<PAGE>
This is filed pursuant to Rule 497(e).
File Nos.: 2-61564 and 811-02835
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<PAGE>
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YIELDS
- --------------------------------------------------------------------------------
For current recorded yield information on the Funds, call toll-free
(800) 221-9513.
The Funds are open-end management investment companies with investment
objectives of safety, liquidity and maximum current income (in the case of
Alliance Municipal Trust-General, exempt from Federal income taxes) to the
extent consistent with the first two objectives. Alliance Capital Reserves,
Alliance Government Reserves and the General Portfolio of Alliance Municipal
Trust are diversified. This prospectus sets forth the information about each
Fund that a prospective investor should know before investing. Please retain it
for future reference.
AN INVESTMENT IN A FUND IS (I) NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT; (II) NOT A DEPOSIT OR OBLIGATION OF, OR GUARANTEED OR ENDORSED BY,
ANY BANK; AND (III) NOT FEDERALLY INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY. THERE CAN BE NO
ASSURANCE THAT A FUND WILL BE ABLE TO MAINTAIN A STABLEN ET ASSET VALUE OF $1.00
PER SHARE.
A "Statement of Additional Information" for each Fund dated October 31, 1997,
which provides a further discussion of certain areas in this prospectus and
other matters which may be of interest to some investors, has been filed with
the Securities and Exchange Commission and is incorporated herein by reference.
A free copy may be obtained by contacting your Account Executive.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
CONTENTS
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<TABLE>
<S> <C>
Expense Information....................................................... 2
Financial Highlights...................................................... 3
Investment Objectives and Policies........................................ 5
Purchase and Redemption of Shares......................................... 9
Additional Information.................................................... 10
</TABLE>
Butler, Wick & Company
Introduces...
. Alliance Capital Reserves
. Alliance Government Reserves
. Alliance Municipal Trust --
General Portfolio
PROSPECTUS
OCTOBER 31, 1997
Butler Wick
---------------
& CO., INC.
---------------
MEMBER S.I.P.C.
CORPORATE HEADQUARTERS:
City Centre One . Suite 700 . P.O. Box 149 . Youngstown, Ohio 44501
(330) 744-4351 in Ohio or 1-800-229-1643
Warren Alliance Canton Kent
330-393-1567 330-823-7666 330-493-1616 330-678-2151
Salem Sharon Franklin Cleveland
330-337-9911 412-346-4175 814-432-3169 216-899-9450
<PAGE>
EXPENSE INFORMATION
SHAREHOLDER TRANSACTION EXPENSES
The Funds have no sales load on purchases or reinvested dividends, deferred
sales load, redemption fee or exchange fee.
<TABLE>
<CAPTION>
ANNUAL FUND OPERATING EXPENSES (as a percentage of average ACR AGR AMT-GEN
net assets, after expense reimbursement) --- ---- -------
<S> <C> <C> <C>
Management Fees.......................................... .46% .47% .50%
12b-1 Fees............................................... .25 .25 .25
Other Expenses........................................... .29 .28 .25
---- ---- ----
Total Fund Operating Expenses............................ 1.00% 1.00% 1.00%
</TABLE>
EXAMPLE
You would pay the following expenses on a $1,000 investment, assuming a 5%
annual return (cumulatively through the end of each time period):
<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
ACR.......................................... $10 $32 $55 $122
AGR.......................................... $10 $32 $55 $122
AMT--General................................. $10 $32 $55 $122
</TABLE>
The purpose of the foregoing table is to assist the investor in understand-
ing the various costs and expenses that an investor in the Fund will bear di-
rectly and indirectly. THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF
PAST OR FUTURE EXPENSES; ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE
SHOWN.
2
<PAGE>
FINANCIAL HIGHLIGHTS . FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
The following tables have been audited by McGladrey & Pullen LLP, each of
the Fund's independent auditors, whose unqualified report thereon appears in
each Statement of Additional Information. This information should be read in
conjunction with the financial statements and notes thereto included in each
Fund's Statement of Additional Information.
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30,
ALLIANCE CAPITAL RESERVES ----------------------------------------------------------------------------------------
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of year....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... .0452 .0471 .0447 .0255 .0266 .0438 .0662 .0782 .0788 .0625
Net realized gain on
investments............. -0- -0- -0- -0- .0003 .0013 -0- -0- -0- -0-
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net increase in net
assets from operations.. .0452 .0471 .0447 .0255 .0269 .0451 .0662 .0782 .0788 .0625
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income....... (.0452) (.0471) (.0447) (.0255) (.0266) (.0438) (.0662) (.0782) (.0788) (.0625)
Distributions from net
realized gains.......... -0- -0- -0- -0- (.0003) (.0013) -0- -0- -0- -0-
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total dividends and
distributions........... (.0452) (.0471) (.0447) (.0255) (.0269) (.0451) (.0662) (.0782) (.0788) (.0625)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of
year.................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
TOTAL RETURNS
Total investment return
based on:
Net asset value(a)...... 4.63% 4.82% 4.57% 2.58% 2.73% 4.61% 6.84% 8.14% 8.20% 6.45%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year
(in millions)........... $ 5,733 $ 4,804 $ 3,024 $ 2,417 $ 2,112 $ 1,947 $ 1,937 $ 1,891 $ 1,536 $ 1,392
Ratio to average net
assets of:
Expenses, net of waivers
and reimbursements..... 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% .97% .88% .95% .95%
Expenses, before waivers
and reimbursements..... 1.00% 1.00% 1.03% 1.03% 1.00% 1.00% .97% .98% 1.05% 1.05%
Net investment
income(b).............. 4.53% 4.69% 4.51% 2.57% 2.65% 4.37% 6.62% 7.82% 7.87% 6.26%
</TABLE>
- -------
(a) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period.
(b) Net of expenses reimbursed or waived by the Adviser.
<TABLE>
<CAPTION>
ALLIANCE GOVERNMENT YEAR ENDED JUNE 30,
RESERVES ----------------------------------------------------------------------------------------
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, begin-
ning of year.......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.. .0443 .0461 .0439 .0244 .0256 .0421 .0640 .0765 .0774 .0612
Net realized gain on
investments........... -0- -0- -0- -0- .0001 -0- -0- .0001 -0- -0-
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net increase in net
assets from
operations............ .0443 .0461 .0439 .0244 .0257 .0421 .0640 .0766 .0774 .0612
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net in-
vestment income....... (.0443) (.0461) (.0439) (.0244) (.0256) (.0421) (.0640) (.0765) (.0774) (.0612)
Distributions from net
realized gains........ -0- -0- -0- -0- (.0001) -0- -0- (.0001) -0- -0-
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total dividends and
distributions......... (.0443) (.0461) (.0439) (.0244) (.0257) (.0421) (.0640) (.0766) (.0774) (.0612)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net asset value, end of
year.................. $1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ======= ======= ======= ======= ======= ======= ======= ======= =======
TOTAL RETURNS
Total investment return
based on:
net asset value(a).... 4.53% 4.72% 4.48% 2.48% 2.60% 4.30% 6.61% 7.96% 8.04% 6.31%
RATIOS/SUPPLEMENTAL
DATA
Net assets, end of year
(in millions)......... $3,762 $3,205 $2,514 $2,061 $1,783 $1,572 $1,070 $584 $522 $315
Ratio to average net
assets of:
Expenses, net of
waivers and
reimbursements........ 1.00% 1.00% 1.00% 1.00% 1.00% .95% .89% .88% .88% .80%
Expenses, before
waivers and
reimbursements........ 1.00% 1.01% 1.05% 1.04% 1.02% .97% .93% .98% .98% .90%
Net investment
income(b)............. 4.44% 4.60% 4.42% 2.46% 2.55% 4.17% 6.28% 7.65% 7.86% 6.13%
</TABLE>
- -------
(a) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period.
(b) Net of expenses reimbursed or waived by the Adviser.
3
<PAGE>
<TABLE>
<CAPTION>
GENERAL PORTFOLIO
ALLIANCE MUNICIPAL TRUST ------------------------------------------------------------------------------------------------
YEAR ENDED
YEAR ENDED JUNE 30, SIX MONTHS DECEMBER 31,
----------------------------------------------------------------- ENDED --------------
1997 1996 1995 1994 1993 1992 1991 1990 JUNE 30, 1989 1988 1987
------ ------ ------ ------ ------ ------ ------ ------ ------------- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value,
beginning of period.... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.. .028 .029 .028 .018 .020 .034 .046 .055 .030 .047 .041
Net realized and
unrealized loss on
investments........... -0- -0- (.003) -0- -0- -0- -0- -0- -0- -0- -0-
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net increase in net
asset value from
operations............ .028 .029 .025 .018 .020 .034 .046 .055 .030 .047 .041
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
ADD: CAPITAL
CONTRIBUTIONS
Capital Contributed by
the Adviser........... -0- -0- .003 -0- -0- -0- -0- -0- -0- -0- -0-
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
LESS: DIVIDENDS
Dividends from net
investment income..... (.028) (.029) (.028) (.018) (.020) (.034) (.046) (.055) (.030) (.047) (.041)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net asset value, end of
period................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ====== ====== ====== ====== ====== ====== ====== ====== ======
TOTAL RETURNS
Total investment return
based on net asset
value(a).............. 2.81% 2.93% 2.83%(c) 1.81% 2.05% 3.48% 4.71% 5.65% 6.13%(b) 4.81% 4.18%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of
period (in millions).. $980 $1,148 $1,189 $1,134 $1,016 $914 $883 $798 $695 $633 $690
Ratio to average net
assets of:
Expenses, net of
waivers and
reimbursements........ .94% .95% .94% .92% .92% .92% .89% .83% .84%(b) .83% .80%
Expenses, before
waivers and
reimbursements........ .94% .95% .95% .94% .94% .95% .95% .93% .94%(b) .93% .90%
Net investment
income(d)............. 2.76% 2.90% 2.78% 1.80% 2.02% 3.40% 4.57% 5.50% 5.96%(b) 4.69% 4.08%
</TABLE>
- -------
(a) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period.
(b) Annualized.
(c) The capital contribution by the Adviser had no effect on total return.
(d) Net of expenses reimbursed or waived by the Adviser.
---------------
From time to time each Fund advertises its "yield" and "effective yield."
Both yield figures are based on historical earnings and are not intended to
indicate future performance. To calculate the "yield," the amount of dividends
paid on a share during a specified seven-day period is assumed to be paid each
week over a 52-week period and is shown as a percentage of the investment. To
calculate "effective yield," which will be higher than the "yield" because of
compounding, the dividends paid are assumed to be reinvested. For ACR divi-
dends for the seven days ended June 30, 1997 amounted to an annualized yield
of 4.72%, equivalent to an effective yield of 4.83%. For AGR dividends for the
seven days ended June 30, 1997 amounted to an annualized yield of 4.62%,
equivalent to an effective yield of 4.73%. Dividends for the General Portfolio
for the seven days ended June 30, 1997 amounted to an annualized yield of
3.20%, equivalent to an effective yield of 3.25%.
4
<PAGE>
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INVESTMENT OBJECTIVES AND POLICIES
- --------------------------------------------------------------------------------
The investment objectives of each of the Funds are--in the following order
of priority--safety of principal, excellent liquidity and, to the extent con-
sistent with the first two objectives, maximum current income (exempt from in-
come taxation to the extent described below in the case of AMT-General). As a
matter of fundamental policy, each Fund pursues its objectives by maintaining
a portfolio of high-quality money market securities all of which at the time
of investment have remaining maturities of one year or less, which maturities
may extend to 397 days. While the fundamental policies described above and the
other fundamental investment policies described below may not be changed with-
out shareholder approval, each Fund may, upon notice to shareholders, but
without such approval, change nonfundamental investment policies or create ad-
ditional classes of shares in order to establish portfolios which may have
different investment objectives. There can be no assurance that any Fund's ob-
jectives will be achieved.
The Funds will comply with Rule 2a-7 under the Investment Company Act of
1940 (the "1940 Act") as amended from time to time, including the diversifica-
tion, quality and maturity limitations imposed by the Rule. The average matu-
rity of each Fund's portfolio cannot exceed 90 days. A more detailed descrip-
tion of Rule 2a-7 is set forth in each Fund's Statement of Additional Informa-
tion. To the extent that each Fund's limitations are more permissive than Rule
2a-7, each Fund will comply with the more restrictive provisions of the Rule.
ALLIANCE CAPITAL RESERVES
The money market securities in which Alliance Capital Reserves ("ACR") in-
vests include: (1) marketable obligations of, or guaranteed by, the United
States Government, its agencies or instrumentalities (collectively, the "U.S.
Government"); (2) certificates of deposit, bankers' acceptances and interest-
bearing savings deposits issued or guaranteed by banks or savings and loan as-
sociations having total assets of more than $1 billion and which are members
of the Federal Deposit Insurance Corporation and certificates of deposit and
bankers' acceptances denominated in U.S. dollars and issued by U.S. branches
of foreign banks having total assets of at least $1 billion that are believed
by the Adviser to be of quality equivalent to that of other such instruments
in which ACR may invest; (3) commercial paper, including variable amount mas-
ter demand notes, of prime quality [i.e., rated A-1+ or A-1 by Standard &
Poor's Corporation ("Standard & Poor's") or Prime-1 by Moody's Investors Serv-
ice, Inc. ("Moody's") or, if not rated, issued by companies having outstanding
debt securities rated AAA or AA by Standard & Poor's, or Aaa or Aa by Moody's]
and participation interests in loans extended by banks to such companies; and
(4) repurchase agreements that are collateralized in full each day by liquid
securities of the types listed above. These agreements are entered into with
"primary dealers" (as designated by the Federal Reserve Bank of New York) in
U.S. Government securities or State Street Bank and Trust Company, ACR's Cus-
todian, and would create a loss to ACR if, in the event of a dealer default,
the proceeds from the sale of the collateral were less than the repurchase
price. ACR may also invest in certificates of deposit issued by, and time de-
posits maintained at, foreign branches of domestic banks described in (2)
above and prime quality dollar-denominated commercial paper issued by foreign
companies meeting the criteria specified in (3) above. The money market secu-
rities in which ACR invests may have variable or floating rates of interest
("variable rate obligations") as permitted by Rule 2a-7 under the 1940 Act.
Variable rate obligations have interest rates which are adjusted either at
predesignated periodic intervals or whenever there is a change in the market
rate to which the interest rate of the variable rate obligation is tied. Some
variable rate obligations allow the holder to demand payment of principal at
anytime, or at specified intervals. ACR follows Rule 2a-7 with respect to the
diversification, quality, and maturity of variable rate obligations.
ACR may purchase restricted securities that are determined by the Adviser to
be liquid in accordance with procedures adopted by the Trustees of ACR, in-
cluding securities eligible for resale under Rule 144A under the Securities
Act of 1933 (the "Securities Act") and commercial paper issued in reliance
upon the exemption from registration in Section 4(2) of the Securities Act.
5
<PAGE>
Restricted securities are securities subject to contractual or legal restric-
tions on resale, such as those arising from an issuer's reliance upon certain
exemptions from registration under the Securities Act.
ACR may also invest up to 10% of the value of its net assets in securities
as to which a liquid trading market does not exist, provided such investments
are consistent with ACR's investment objectives. Such securities may include
securities that are not readily marketable, such as certain securities that
are subject to legal or contractual restrictions on resale (other than those
restricted securities determined to be liquid as described above) and repur-
chase agreements not terminable within seven days. As to these securities, ACR
is subject to a risk that should ACR desire to sell them when a ready buyer is
not available at a price ACR deems representative of their value, the value of
ACR's net assets could be adversely affected.
ACR may invest in asset-backed securities that meet its existing diversifi-
cation, quality and maturity criteria. Asset-backed securities are securities
issued by special purpose entities whose primary assets consist of a pool of
loans or accounts receivable. The securities may be in the form of a benefi-
cial interest in a special purpose trust, limited partnership interest, or
commercial paper or other debt securities issued by a special purpose corpora-
tion. Although the securities may have some form of credit or liquidity en-
hancement, payments on the securities depend predominately upon collection of
the loans and receivables held by the issuer. It is ACR's current intention to
limit its investment in such securities to not more than 5% of its net assets.
OTHER FUNDAMENTAL INVESTMENT POLICIES
To maintain portfolio diversification and reduce investment risk, ACR may
not: (1) invest more than 25% of its assets in the securities of issuers con-
ducting their principal business activities in any one industry although there
is no such limitation with respect to U.S. Government securities or certifi-
cates of deposit, bankers' acceptances and interest bearing savings deposits;
(2) invest more than 5% of its assets in securities of any one issuer (except
the U.S. Government) although with respect to 25% of its total assets it may
invest without regard to such limitation; (3) invest more than 5% of its as-
sets in the securities of any issuer (except the U.S. Government) having less
than three years of continuous operation or purchase more than 10% of any
class of the outstanding securities of any issuer (except the U.S. Govern-
ment); (4) borrow money except from banks on a temporary basis or via entering
into reverse repurchase agreements in aggregate amounts not exceeding 15% of
its assets and to facilitate the orderly maturation and sale of portfolio se-
curities during any periods of abnormally heavy redemption requests; (5) mort-
gage, pledge or hypothecate its assets except to secure such borrowings; or
(6) enter into repurchase agreements, if as a result thereof, more than 10% of
ACR's assets would be subject to repurchase agreements not terminable within
seven days.
As a matter of operating policy, fundamental policy number (2) would give
ACR the ability to invest, with respect to 25% of its assets, more than 5% of
its assets in any one issuer only in the event Rule 2a-7 is amended in the fu-
ture.
ALLIANCE GOVERNMENT RESERVES
The securities in which Alliance Government Reserves ("AGR") invests are:
(1) marketable obligations of, or guaranteed by, the United States Government,
its agencies or instrumentalities (collectively, the "U.S. Government"), in-
cluding issues of the United States Treasury, such as bills, certificates of
indebtedness, notes and bonds, and issues of agencies and instrumentalities
established under the authority of an act of Congress; and (2) repurchase
agreements that are collateralized in full each day by the types of securities
listed above. These agreements are entered into with "primary dealers" (as
designated by the Federal Reserve Bank of New York) in U.S. Government securi-
ties or State Street Bank and Trust Company, AGR's Custodian, and would create
a loss to AGR if, in the event of a dealer default, the proceeds from the sale
of the collateral were less than the repurchase price. AGR may commit up to
15% of its net assets to the purchase of when-issued U.S. Government securi-
ties, whose value may fluctuate prior to their settlement, thereby creating an
unrealized gain or loss to AGR. The money market securities in which AGR may
invest may have variable or floating rates of interest ("variable rate obliga-
tions") as permitted by Rule 2a-7 under the 1940 Act. Variable rate obliga-
tions have interest rates which
6
<PAGE>
are adjusted either at predesignated periodic intervals or whenever there is a
change in the market rate to which the interest rate of the variable rate ob-
ligation is tied. Some variable rate obligations allow the holder to demand
payment of principal at any time, or at specified intervals. AGR follows Rule
2a-7 with respect to the diversification, quality and maturity of variable
rate obligations.
OTHER FUNDAMENTAL INVESTMENT POLICIES
To maintain portfolio diversification and reduce investment risk, AGR may
not: (1) borrow money except from banks on a temporary basis or via entering
into reverse repurchase agreements in aggregate amounts not exceeding 10% of
its assets and to be used exclusively to facilitate the orderly maturation and
sale of portfolio securities during any periods of abnormally heavy redemption
requests, if they should occur; such borrowings may not be used to purchase
investments and AGR will not purchase any investment while any such borrowings
exist; (2) pledge, hypothecate or in any manner transfer, as security for in-
debtedness, its assets except to secure such borrowings; or (3) enter into re-
purchase agreements if, as a result thereof, more than 10% of its assets would
be subject to repurchase agreements not terminable within seven days.
ALLIANCE MUNICIPAL TRUST
The investment objectives of AMT-General are safety of principal, liquidity
and, to the extent consistent with these objectives, maximum current income
that is exempt from income taxation to the extent described below. Except when
AMT-General assumes a temporary defensive position, as a matter of fundamental
policy, at least 80% of the Portfolio's total assets will be invested in mu-
nicipal securities (as opposed to the taxable investments described below).
Normally, substantially all of the Portfolio's income will be tax-exempt as
described below (e.g., for 1996, 100% of the income of the Portfolio was ex-
empt from Federal income taxes).
The General Portfolio seeks maximum current income that is exempt from Fed-
eral income taxes by investing principally in a diversified portfolio of high
quality municipal securities. Such income may be subject to state or local in-
come taxes.
AMT-General may invest without limitation in tax-exempt municipal securities
subject to the alternative minimum tax (the "AMT").
Under current Federal income tax law, (1) interest on tax-exempt municipal
securities issued after August 7, 1986 which are "specified private activity
bonds," and the proportionate share of any exempt-interest dividends paid by a
regulated investment company which receives interest from such specified pri-
vate activity bonds, will be treated as an item of tax preference for purposes
of the AMT imposed on individuals and corporations, though for regular Federal
income tax purposes such interest will remain fully tax-exempt, and (2) inter-
est on all tax-exempt obligations will be included in "adjusted current earn-
ings" of corporations for AMT purposes. Such bonds have provided, and may con-
tinue to provide, somewhat higher yields than other comparable municipal secu-
rities. See below, "Daily Dividends, Other Distributions, Taxes."
Municipal Securities. The municipal securities in which AMT-General invests
include municipal notes and short-term municipal bonds. Municipal notes are
generally used to provide for short-term capital needs and generally have ma-
turities of one year or less. Examples include tax anticipation and revenue
anticipation notes, which are generally issued in anticipation of various sea-
sonal revenues, bond anticipation notes, and tax-exempt commercial paper.
Short-term municipal bonds may include general obligation bonds, which are se-
cured by the issuer's pledge of its faith, credit and taxing power for payment
of principal and interest, and revenue bonds, which are generally paid from
the revenues of a particular facility or a specific excise or other source.
AMT-General may invest in variable rate obligations whose interest rates are
adjusted either at predesignated periodic intervals or whenever there is a
change in the market rate to which the security's interest rate is tied. Such
adjustments minimize changes in the market value of the obligation and, ac-
cordingly, enhance the ability of the Portfolio to maintain a stable net asset
value. Variable rate securities purchased may include participation interests
in industrial development bonds backed by letters of credit of Federal Deposit
Insurance Corporation member banks having total assets of more than $1 bil-
lion. AMT-General will comply with Rule 2a-7 with respect to its
7
<PAGE>
investments in variable rate obligations supported by letters of credit.
AMT-General's municipal securities at the time of purchase are rated within
the two highest quality ratings of Moody's Investors Service, Inc. (Aaa and
Aa, MIG 1 and MIG 2, or VMIG 1 and VMIG 2) or Standard & Poor's Corporation
(AAA and AA or SP-1 and SP-2), or judged by the Adviser to be of comparable
quality. Securities must also meet credit standards applied by the Adviser.
To further enhance the quality and liquidity of the securities in which the
Portfolio invests, such securities frequently are supported by credit and li-
quidity enhancements, such as letters of credit, from third party financial
institutions. The Adviser continuously monitors the credit quality of such
third parties; however, changes in the credit quality of such a financial in-
stitution could cause a Portfolio's investments backed by that institution to
lose value and affect a Portfolio's share price.
AMT-General also may invest in stand-by commitments, which may involve cer-
tain expenses and risks, but such commitments are not expected to comprise
more than 5% of AMT-General's net assets. AMT-General may commit up to 15% of
its net assets to the purchase of when-issued securities. The Fund's custodian
will maintain, in a separate account of AMT-General, liquid high-grade debt
securities having value equal to, or greater than, such when-issued securi-
ties. The price of when-issued securities, which is generally expressed in
yield terms, is fixed at the time the commitment to purchase is made, but de-
livery and payment for such securities takes place at a later time. Normally
the settlement date occurs from within ten days to one month after the pur-
chase of the issue. The value of when-issued securities may fluctuate prior to
their settlement, thereby creating an unrealized gain or loss to AMT-General.
Taxable Investments. The taxable investments in which AMT-General may invest
include obligations of the U.S. Government and its agencies, high quality cer-
tificates of deposit and bankers' acceptances, prime commercial paper, and re-
purchase agreements.
Other Investment Policies. AMT-General will not invest more than 10% of its
net assets in illiquid securities. As to these securities, AMT-General is sub-
ject to a risk that should the Portfolio desire to sell them when a ready
buyer is not available at a price the Portfolio deems representative of their
value, the value of the Portfolio's net assets could be adversely affected.
Illiquid securities may include securities that are not readily marketable.
The following investment policies are fundamental policies with respect to
AMT-General. To reduce investment risk, the General Portfolio may not invest
more than 25% of its total assets in municipal securities whose issuers are
located in the same state, and invest more than 25% of its total assets in mu-
nicipal securities the interest upon which is paid from revenues of similar-
type projects; AMT-General may not invest more than 5% of its total assets in
the securities of any one issuer except the U.S. Government, although with re-
spect to 25% of its total assets may invest up to 10% per issuer, and AMT-Gen-
eral may not purchase more than 10% of any class of the voting securities of
any one issuer except those of the U.S. Government.
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PURCHASE AND REDEMPTION OF SHARES
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For more information on the purchase and redemption of each Fund's shares,
see such Fund's Statement of Additional Information.
The Funds offer a variety of shareholder services. For more information
about these services, please call your Account Executive.
PURCHASE OF SHARES
OPENING ACCOUNTS
Instruct your Account Executive to use ACR, AGR or AMT-General in
conjunction with your brokerage account.
SUBSEQUENT INVESTMENTS
A. BY CHECK THROUGH BUTLER, WICK
Mail or deliver your check or negotiable draft payable to "Butler, Wick &
Co." to your Account Executive who will deposit it into the Fund(s). Please
indicate your Fund account number on the check or draft.
B. BY SWEEP
Butler, Wick has available an automatic "sweep" for the Funds in the opera-
tion of brokerage accounts for its customers. Once your account is estab-
lished, all monies coming into your cash account will be moved into your money
market fund account daily.
C. BY CONTACTING YOUR ACCOUNT EXECUTIVE
Cash that has come into your brokerage account from proceeds of your securi-
ties sales or from any other source can be moved into your Fund account by
contacting your Account Executive either specifically each time that you know
there is a cash balance or by providing standing instructions to your Account
Executive to immediately move all such cash to the Funds.
REDEMPTIONS
A. BY CONTACTING YOUR ACCOUNT EXECUTIVE
Instruct your Account Executive to order a withdrawal from your Fund account
to purchase securities or to make payment with a Butler, Wick check either to
you or to your designated payee.
B. BY CHECKWRITING
With this service you may write checks made payable to any payee. Checks
cannot be written for more than the principal balance (not including any ac-
crued dividends) in your account. First you must fill out the Signature Card
which you can obtain from your Account Executive. The checkwriting service en-
ables you to receive the daily dividends declared on the shares to be redeemed
until the day that your check is presented for payment. All check ordering
must be handled through Butler, Wick. Please contact your Account Executive
when additional checks are needed.
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ADDITIONAL INFORMATION
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SHARE PRICE. Shares are sold and redeemed on a continuous basis without sales
or redemption charges at their net asset value which is expected to be constant
at $1.00 per share, although this price is not guaranteed. The net asset value
of each Fund's shares is determined each business day at 12:00 Noon and 4:00
p.m. (New York time). The net asset value per share of a Fund is calculated by
taking the sum of the value of that Fund's investments (amortized cost value is
used for this purpose) and any cash or other assets, subtracting liabilities,
and dividing by the total number of shares outstanding. All expenses, including
the fees payable to the Adviser, are accrued daily.
TIMING OF INVESTMENTS AND REDEMPTIONS. The Funds have two transaction times
each business day, 12:00 Noon and 4:00 p.m. (New York time). New investments
represented by Federal funds or bank wire monies received by State Street Bank
at any time during a day prior to 4:00 p.m. are entitled to the full dividend
to be paid to shareholders for that day. Shares do not earn dividends on the
day a redemption is effected regardless of whether the redemption order is re-
ceived before or after 12:00 Noon. However, if you wish to have Federal funds
wired the same day as your telephone redemption request, make sure that your
request will be received by the Fund prior to 12:00 Noon.
During drastic economic or market developments, shareholders might have dif-
ficulty in reaching Alliance Fund Services, Inc. by telephone in which event
the shareholder should issue written instructions to Alliance Fund Services,
Inc. at the address shown in this prospectus. The Funds reserve the right to
suspend or terminate their telephone service at any time without notice. Nei-
ther the Funds nor the Adviser, or Alliance Fund Services, Inc. will be respon-
sible for the authenticity of telephone requests to purchase or sell shares.
The Funds will employ reasonable procedures in order to verify that telephone
requests are genuine and could be liable for losses arising from unauthorized
transactions if it failed to do so. Selected dealers or agents may charge a
commission for handling telephone requests for redemptions.
Redemption proceeds are normally wired or mailed either the same or the next
business day, but in no event later than seven days, unless redemptions have
been suspended or postponed due to the determination of an "emergency" by the
Securities and Exchange Commission or to certain other unusual conditions.
DAILY DIVIDENDS, OTHER DISTRIBUTIONS, TAXES. All net income of each Fund is
determined each business day at 4:00 p.m. (New York time) and is paid immedi-
ately thereafter pro rata to shareholders of that Fund of record via automatic
investment in additional full and fractional shares of that Fund in each share-
holder's account. As such additional shares are entitled to dividends on fol-
lowing days, a compounding growth of income occurs.
Net income consists of all accrued interest income on Fund assets less the
Fund's expenses applicable to that dividend period. Realized gains and losses
are reflected in its net asset value and are not included in net income.
Distributions to you out of tax-exempt interest income earned by AMT-General
are not subject to Federal income tax (other than the AMT), but may be subject
to state or local income taxes. Any exempt-interest dividends derived from in-
terest on municipal securities subject to the AMT will be a specific preference
item for purposes of the Federal individual and corporate AMT.
Distributions out of taxable interest income, other investment income, and
short-term capital gains are taxable to you as ordinary income and distribu-
tions of long-term capital gains, if any, are taxable as long-term capital
gains irrespective of the length of time you may have held your shares. Distri-
butions of short and long-term capital gains, if any, are normally made near
year-end. Each year shortly after December 31, the Funds will send you tax in-
formation stating the amount and type of all its distributions for the year
just ended.
THE ADVISER. Each Fund retains Alliance Capital Management L.P., 1345 Avenue
of the Americas, New York, NY 10105 under separate Advisory Agreements to pro-
vide investment advice and, in general, to supervise its management and invest-
ment program, subject to the general control of the Trustees of each Fund. For
the fiscal
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year ended June 30, 1997, ACR, AGR and AMT-General, each paid the Adviser an
advisory fee at an annual rate of .47, .48 and .50 of 1%, respectively, of the
average daily value of the respective Portfolio's net assets.
The Adviser is a leading international investment manager, supervising client
accounts with assets as of September 30, 1997 totaling more than $217 billion
(of which more than $81 billion represented the assets of investment compa-
nies). The Adviser's clients are primarily major corporate employee benefit
plans, public employee retirement plans, insurance companies, banks, founda-
tions and endowment funds. The 54 registered investment companies managed by
the Adviser comprising 116 separate investment portfolios currently have over
two million shareholders. As of September 30, 1997, the Adviser was retained
as an investment manager of employee benefit fund assets for 28 of the Fortune
100 companies.
Alliance Capital Management Corporation, the sole general partner of, and the
owner of a 1% general partnership interest in, the Adviser, is an indirect
wholly-owned subsidiary of The Equitable Life Assurance Society of the United
States, one of the largest life insurance companies in the United States,
which is a wholly-owned subsidiary of The Equitable Companies Incorporated, a
holding company controlled by AXA, a French insurance holding company. Certain
information concerning the ownership and control of Equitable by AXA is set
forth in each Fund's Statement of Additional Information under "Management of
the Fund."
Under a Distribution Services Agreement (the "Agreement"), each Fund pays
the Adviser at a maximum annual rate of .25 of 1% of the Fund's aggregate av-
erage daily net assets. For the period ended June 30, 1997, ACR, AGR and AMT-
General each paid the Adviser a distribution services fee at an annual rate of
.25 of 1% of the average daily value of the net assets of each Portfolio. Sub-
stantially all such monies (together with significant amounts from the Advis-
er's own resources) are paid by the Adviser to broker-dealers and other finan-
cial intermediaries for their distribution assistance and to banks and other
depository institutions for administrative and accounting services provided to
the Funds, with any remaining amounts being used to partially defray other ex-
penses incurred by the Adviser in distributing the Funds' shares. The Funds
believe that the administrative services provided by depository institutions
are permissible activities under present banking laws and regulations and will
take appropriate actions (which should not adversely affect the Funds or their
shareholders) in the future to maintain such legal conformity should any
changes in, or interpretations of, such laws or regulations occur.
The Adviser will reimburse each Fund to the extent that aggregate operating
expenses of that Fund (including the Adviser's fee and expenses incurred under
the Agreement) exceed 1% of its average daily net assets for any fiscal year.
CUSTODIAN, TRANSFER AGENT AND DISTRIBUTOR. State Street Bank and Trust Com-
pany, P.O. Box 1912, Boston, MA 02105, is the Funds' Custodian. Alliance Fund
Services, Inc., P.O. Box 1520, Secaucus, NJ 07096-1520 and Alliance Fund Dis-
tributors, Inc., 1345 Avenue of the Americas, New York, NY 10105, are the
Funds' Transfer Agent and Distributor, respectively. The transfer agent
charges a fee for its services.
FUND ORGANIZATION. AGR and Alliance Treasury Reserves (not offered by this
prospectus) are series of Alliance Government Reserves which is a diversified
open-end management investment company registered under the 1940 Act. The Fund
was reorganized as a Massachusetts business trust in October 1984, having pre-
viously been a Maryland corporation since its formation in December 1978. ACR
and Alliance Money Reserves (not offered by this prospectus) are series of Al-
liance Capital Reserves, a diversified open-end management investment company
registered under the 1940 Act. The Fund was reorganized as a Massachusetts
business trust in October 1984, having previously been a Maryland corporation
since its formation in April 1978. AMT-General is a diversified series of Al-
liance Municipal Trust which is also an open-end management investment company
registered under the 1940 Act consisting of such series and seven other series
not offered by this prospectus. The Fund was reorganized as a Massachusetts
business trust in April 1985, having previously been a Maryland corporation
since its formation in January 1983. Each Fund's activities are supervised by
its Trustees. Normally, shares of
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each series of Alliance Municipal Trust, Alliance Government Reserves and Al-
liance Capital Reserves are entitled to one vote per share, and vote as a sin-
gle series, on matters that affect each series in substantially the same man-
ner. Massachusetts law does not require annual meetings of shareholders and it
is anticipated that shareholder meetings will be held only when required by
Federal law. Shareholders have available certain procedures for the removal of
Trustees.
REPORTS. You receive semi-annual and annual reports for your Fund as well as
a monthly summary of your account.
Since this prospectus sets forth information about all the Funds, it is the-
oretically possible that a Fund might be liable for any materially inaccurate
or incomplete disclosure in this prospectus concerning another Fund. Based on
the advice of counsel, however, the Funds believe that the potential liability
of each Fund with respect to the disclosure in this prospectus extends only to
the disclosure relating to that Fund.
12
