This is filed pursuant to Rule 497(e).
File Nos.: 002-63315 and 811-02889
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 the
New York, California, Connecticut, New Jersey, Virginia, Florida and
Massachusetts Portfolios, exempt from Federal and state income taxes of the
respective states) to the extent consistent with the first two objectives.
Alliance Money Reserves and Alliance Treasury Reserves are diversified. The New
York, California, Connecticut, New Jersey, Virginia, Florida and Massachusetts
Portfolios of Alliance Municipal Trust are non-diversified, and are offered only
to residents of each such respective state. 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 stable net asset value of $1.00
per share. The Portfolios of Alliance Municipal Trust may invest a significant
portion of their assets in the securities of a single issuer. Accordingly, an
investment in such Portfolios may be riskier than an investment in other types
of money market funds.
A "Statement of Additional Information" for each Fund dated October 30,
1998, 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 Introducing Financial
Institution.
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
Expense Information ........................................................ 2
Financial Highlights ....................................................... 3
Investment Objectives and Policies ......................................... 7
Purchase and Redemption of Shares .......................................... 12
Additional Information ..................................................... 12
- --------------------------------------------------------------------------------
DISCOVER(R) Brokerage
[LOGO] DIRECT(SM)
A Morgan Stanley Dean Witter Company
Featuring...
================================================================================
Alliance Money Reserves
Alliance Treasury Reserves
Alliance Municipal Trust
- California Portfolio
- Connecticut Portfolio
- Florida Portfolio
- Massachusetts Portfolio
- New Jersey Portfolio
- New York Portfolio
- Virginia Portfolio
================================================================================
Prospectus
October 30, 1998
333 Market Street, 25th Floor
San Francisco, CA94105
www.discoverbrokerage.com
Member NASD/SIPC
<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 net assets, after
expense reimbursement) AMR ATR AMT-NY AMT-CA AMT-CT AMT-NJ AMT-VA AMT-FL AMT-MA
--- --- ------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Management Fees ............. .48% .49% .50% .50% .50% .50% .50% .50% .50%
12b-1 Fees .................. .25 .25 .25 .25 .25 .25 .25 .25 .25
Other Expenses .............. .27 .26 .25 .25 .25 .25 .25 .25 .25
---- ---- ---- ---- ---- ---- ---- ---- ----
Total Fund Operating Expenses 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 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):
1 Year 3 Years 5 Years 10 Years
------ ------- ------- --------
AMR ........................... $ 10 $ 32 $ 55 $122
ATR ........................... $ 10 $ 32 $ 55 $122
AMT--New York ................. $ 10 $ 32 $ 55 $122
AMT--California ............... $ 10 $ 32 $ 55 $122
AMT--Connecticut .............. $ 10 $ 32 $ 55 $122
AMT--New Jersey ............... $ 10 $ 32 $ 55 $122
AMT--Virginia ................. $ 10 $ 32 $ 55 $122
AMT--Florida .................. $ 10 $ 32 $ 55 $122
AMT--Massachusetts ............ $ 10 $ 32 $ 55 $122
The purpose of the foregoing table is to assist the investor in
understanding the various costs and expenses that an investor in the Fund will
bear directly and indirectly. The expenses listed in the table for AMR, ATR,
AMT-NY, AMT-CT, AMT-NJ, AMT-VA, AMT-FL and AMT-MA are net of the contractual
reimbursement by the Adviser described in this prospectus. The expenses of such
Portfolios, before expense reimbursements, would be: AMR: Management Fees --
.48%, 12b-1 Fees -- .25%, Other Expenses -- .29% and Total Operating Expenses --
l.02%; ATR: Management Fees -- .50%, 12b-1 Fees -- .25%, Other Expenses -- .26%
and Total Operating Expenses -- l.01%; AMT-NY: Management Fees -- .50%, 12b-1
Fees -- .25%, Other Expenses -- .26% and Total Operating Expenses -- l.01%;
AMT-CT: Management Fee -- .50%, 12b-1 Fees -- .25%, Other Expenses -- .31% and
Total Operating Expenses -- 1.06%; AMT-NJ: Management Fee -- .50%, 12b-1 Fees --
.25%, Other Expenses -- .32% and Total Operating Expenses -- l.07%; AMT-VA:
Management Fee -- .50%, 12b-1 Fees -- .25%, Other Expenses -- .28% and Total
Operating Expenses -- 1.03%; AMT-FL: Management Fee -- .50%, 12b-1 Fees -- .25%,
Other Expenses -- .31% and Total Operating Expenses -- 1.06%; and AMT-MA:
Management Fees -- .50%, 12b-1 Fees -- .25%, Other Expenses -- .62% and Total
Operating Expenses -- 1.37%. 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 o 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.
Alliance Money Reserves
<TABLE>
<CAPTION>
Year Ended June 30,
------------------------------------------------------------------
1998 1997 1996 1995 1994 1993
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------ ------ ------ ------ ------ ------
Income from Investment Operations
Net investment income(b) .................... .047 .045 .047 .045 .025 .027
------ ------ ------ ------ ------ ------
Less: Dividends
Dividends from net investment income ........ (.047) (.045) (.047) (.045) (.025) (.027)
------ ------ ------ ------ ------ ------
Net asset value, end of period .............. $ 1.00 $1 .00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
====== ====== ====== ====== ====== ======
Total Return
Total investment return based on:
Net asset value(c) ........................ 4.83% 4.64% 4.81% 4.50% 2.57% 2.71%
Ratios/Supplemental Data
Net assets, end of period (in millions) ..... $1,166 $1,011 $ 755 $2,510 $1,795 $1,626
Ratio to average net assets of:
Expenses, net of waivers and reimbursements 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
Expenses, before waivers and reimbursements 1.02% 1.06% 1.00% 1.04% 1.09% 1.04%
Net investment income(b) .................. 4.72% 4.55% 4.80% 4.53% 2.55% 2.67%
<CAPTION>
February 16,
1989(a)
Year Ended June 30, through
------------------------------- June 30,
1992 1991 1990 1989
------ ------ ------ -----
<S> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 1.00 $ 1.00 $ 1.00 $1.00
------ ------ ------ -----
Income from Investment Operations
Net investment income(b) .................... .044 .066 .079 .033
------ ------ ------ -----
Less: Dividends
Dividends from net investment income ........ (.044) (.066) (.079) (.033)
------ ------ ------ -----
Net asset value, end of period .............. $ 1.00 $ 1.00 $ 1.00 $1.00
====== ====== ====== =====
Total Return
Total investment return based on:
Net asset value(c) ........................ 4.47% 6.87% 8.26% 9.18%(d)
Ratios/Supplemental Data
Net assets, end of period (in millions) ..... $1,412 $1,262 $ 993 $ 563
Ratio to average net assets of:
Expenses, net of waivers and reimbursements 1.00% .97% .89% .99%(d)
Expenses, before waivers and reimbursements 1.04% 1.03% 99% 1.09%(d)
Net investment income(b) 4.33% 6.56% 7.92% 9.16%(d)
</TABLE>
- ----------
(a) Commencement of operations.
(b) Net of expenses reimbursed or waived by the Adviser.
(c) 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.
(d) Annualized.
Alliance Treasury Reserves
<TABLE>
<CAPTION>
September 1,
1993(a)
------------------------------------------------- through
Year Ended June 30, June 30,
1998 1997 1996 1995 1994
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Income from Investment Operations
Net investment income(b) ........................... .0453 .0443 .0466 .0460 0.260
-------- -------- -------- -------- --------
Less: Dividends
Dividends from net investment income ............... (.0453) (.0443) (.0466) (.0460) (.0260)
-------- -------- -------- -------- --------
Net asset value, end of period ..................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ========
Total Return
Total investment return based on: net asset value(c) 4.63% 4.53% 4.77% 4.71% 3.18%(d)
Ratios/Supplemental Data
Net assets, end of year (in thousands) ............. $740,056 $704,084 $700,558 $493,702 $ 80,720
Ratio to average net assets of:
Expenses, net of waivers and reimbursements ...... .95% .85% .81% .69% .28%(d)
Expenses, before waivers and reimbursements ...... 1.01% 1.00% 1.05% 1.05% 1.28%(d)
Net investment income(b) ......................... 4.53% 4.43% 4.64% 4.86% 3.24%(d)
</TABLE>
- ----------
(a) Commencement of operations.
(b) Net of expenses reimbursed or waived by the Adviser.
(c) 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.
(d) Annualized.
3
<PAGE>
Alliance Municipal Trust
<TABLE>
<CAPTION>
New York Portfolio
-----------------------------------------------------------------------------------
Year Ended June 30,
-----------------------------------------------------------------------------------
1998 1997 1996 1995 1994 1993
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
Income from Investment Operations
Net investment income(a) .................... .027 .027 .028 .028 .018 .019
-------- -------- -------- -------- -------- --------
Less Dividends
Dividends from net investment income ........ (.027) (.027) (.028) (.028) (.018) (.019)
-------- -------- -------- -------- -------- --------
Net asset value, end of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
Total Return
Total investment return based on net asset
value(b) .................................. 2.74% 2.77% 2.87% 2.84% 1.77% 1.94%
Ratios/Supplemental Data
Net assets, end of period (000's omitted) ... $520,562 $355,461 $330,984 $177,254 $162,839 $100,529
Ratio to average net assets of:
Expenses, net of waivers and reimbursements .93% .85% .85% .85% .84% .80%
Expenses, before waivers and reimbursements 1.01% 1.04% 1.03% 1.03% 1.08% 1.06%
Net investment income(a) .................. 2.69% 2.73% 2.82% 2.81% 1.77% 1.91%
<CAPTION>
New York Portfolio
-------------------------------------------------------------
Six Months Year
Year Ended June 30, Ended Ended
--------------------------------- June 30, Dec. 31,
1992 1991 1990 1989 1988
-------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- ------- ------- ------- -------
Income from Investment Operations
Net investment income(a) .................... .034 .042 .051 .027 .041
-------- ------- ------- ------- -------
Less Dividends
Dividends from net investment income ........ (.034) (.042) (.051) (.027) (.041)
-------- ------- ------- ------- -------
Net asset value, end of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======= ======= ======= =======
Total Return
Total investment return based on net asset
value(b) .................................. 3.47% 4.32% 5.26% 5.61%(c) 4.14%
Ratios/Supplemental Data
Net assets, end of period (000's omitted) ... $100,476 $71,748 $62,536 $41,910 $41,335
Ratio to average net assets of:
Expenses, net of waivers and reimbursements .80% .80% .80% .85%(c) 1.00%
Expenses, before waivers and reimbursements 1.12% 1.15% 1.18% 1.35%(c) 1.33%
Net investment income(a) .................. 3.35% 4.20% 5.13% 5.45%(c) 4.03%
</TABLE>
- ----------
(a) Net of expenses reimbursed or waived by the Adviser.
(b) 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.
(c) Annualized.
<TABLE>
<CAPTION>
California Portfolio
-----------------------------------------------------------------------------------
Year Ended June 30,
-----------------------------------------------------------------------------------
1998 1997 1996 1995 1994 1993
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
Income From Investment Operations
Net investment income(b) .................... .027 .027 .029 .027 .018 .020
-------- -------- -------- -------- -------- --------
Less: Dividends
Dividends from net investment income ........ (.027) (.027) (.029) (.027) (.018) (.020)
-------- -------- -------- -------- -------- --------
Net asset value, end of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
Total Return
Total investment return based on net asset
value(c) .................................. 2.74% 2.76% 2.91% 2.78% 1.83% 2.05%
Ratios/Supplemental Data
Net assets, end of period (000's omitted) ... $422,464 $357,148 $297,862 $236,479 $219,673 $156,200
Ratio to average net assets of:
Expenses, net of waivers and reimbursements .96% .93% .93% .93% .93% .93%
Expenses, before waivers and reimbursements .97% .96% .94% 1.01% 1.02% 1.02%
Net investment income(b) .................. 2.71% 2.73% 2.86% 2.75% 1.82% 2.01%
<CAPTION>
California Portfolio
--------------------------------------------------------------------
Six June 2,
Months 1988(a)
Year Ended June 30, Ended through
------------------------------------- June 30, Dec. 31,
1992 1991 1990 1989 1988
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- --------
Income From Investment Operations
Net investment income(b) .................. .032 .043 .050 0.29 .030
-------- -------- -------- -------- --------
Less: Dividends
Dividends from net investment income ........ (.032) (.043) (.050) (.029) (.030)
-------- -------- -------- -------- --------
Net asset value, end of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ========
Total Return
Total investment return based on net asset
value(c) .................................. 3.26% 4.43% 5.17% 6.02%(d) 5.20%(d)
Ratios/Supplemental Data
Net assets, end of period (000's omitted) ... $121,317 $111,957 $104,097 $242,124 $103,390
Ratio to average net assets of:
Expenses, net of waivers and reimbursements .95% 1.00% .99% .92%(d) .89%(d)
Expenses, before waivers and reimbursements 1.05% 1.10% 1.09% 1.02%(d) 1.10%(d)
Net investment income(b) .................. 3.18% 4.32% 5.03% 5.90%(d) 5.21%(d)
</TABLE>
- ----------
(a) Commencement of operations.
(b) Net of expenses reimbursed or waived by the Adviser.
(c) 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.
(d) Annualized.
4
<PAGE>
<TABLE>
<CAPTION>
Connecticut Portfolio
------------------------------------------------------------
Year Ended June 30,
------------------------------------------------------------
1998 1997 1996 1995 1994
-------- -------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- ------- ------- -------
Income From Investment Operations
Net investment income(b) .......................... .027 .027 .028 .028 .017
-------- -------- ------- ------- -------
Less: Dividends
Dividends from net investment income .............. (.027) (.027) (.028) (.028) (.017)
-------- -------- ------- ------- -------
Net asset value, end of period .................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======= ======= =======
Total Return
Total investment return based on net asset value(c) 2.75% 2.76% 2.88% 2.78% 1.71%
Ratios/Supplemental Data
Net assets, end of period (000's omitted) ......... $124,107 $102,612 $95,812 $75,991 $57,314
Ratio to net assets of:
Expenses, net of waivers and reimbursements ..... .93% .80% .80% .80% .77%
Expenses, before waivers and reimbursements ..... 1.06% 1.10% 1.15% 1.21% 1.21%
Net investment income(b) ........................ 2.69% 2.72% 2.84% 2.77% 1.69%
<CAPTION>
Connecticut Portfolio
-------------------------------------------
January 5,
1990(a)
Year Ended June 30, through
------------------------------- June 30,
1993 1992 1991 1990
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net asset value, beginning of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- -------
Income From Investment Operations
Net investment income(b) .......................... .020 .033 .045 .026
------- ------- ------- -------
Less: Dividends
Dividends from net investment income ....... (.020) (.033) (.045) (.026)
------- ------- ------- -------
Net asset value, end of period .................... $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ======= ======= =======
Total Return
Total investment return based on net asset value(c) 2.00% 3.35% 4.57% 5.53%(d)
Ratios/Supplemental Data
Net assets, end of period (000's omitted) ......... $56,224 $54,751 $48,482 $27,945
Ratio to net assets of:
Expenses, net of waivers and reimbursements ..... .70% .58% .44% .19%(d)
Expenses, before waivers and reimbursements ..... 1.16% 1.22% 1.16% 1.10%(d)
Net investment income(b) ........................ 1.97% 3.28% 4.39% 5.39%(d)
</TABLE>
- ----------
(a) Commencement of operations.
(b) Net of expenses reimbursed or waived by the Adviser.
(c) 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.
(d) Annualized.
<TABLE>
<CAPTION>
New Jersey Portfolio
-------------------------------------------------------------
February 7,
1994(a)
Year Ended June 30, through
----------------------------------------------- June 30,
1998 1997 1996 1995 1994
-------- -------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- ------- ------- -------
Income From Investment Operations
Net investment income(b) .......................... .026 .027 .028 .029 .008
-------- -------- ------- ------- -------
Less: Dividends
Dividends from net investment income .............. (.026) (.027) (.028) (.029) (.008)
-------- -------- ------- ------- -------
Net asset value, end of period .................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======= ======= =======
Total Return
Total investment return based on net asset value(c) 2.67% 2.72% 2.89% 2.93% 2.08%(d)
Ratios/Supplemental Data
Net assets, end of period (000's omitted) ......... $151,617 $123,579 $98,098 $74,133 $36,909
Ratio to average net assets of:
Expenses, net of waivers and reimbursements ..... .94% .85% .82% .74% .70%(d)
Expenses, before waivers and reimbursements ..... 1.07% 1.12% 1.19% 1.29% 1.93%(d)
Net investment income(b) ........................ 2.63% 2.68% 2.84% 2.98% 2.07%(d)
</TABLE>
- ----------
(a) Commencement of operations.
(b) Net of expenses reimbursed or waived by the Adviser.
(c) 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.
(d) Annualized.
5
<PAGE>
<TABLE>
<CAPTION>
Virginia Portfolio
---------------------------------------------
October 25
1994(a)
Year Ended June 30, through
--------------------------------- June 30,
1998 1997 1996 1995
-------- ------- ------- -------
<S> <C> <C> <C> <C>
Net asset value, beginning of period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- ------- ------- -------
Income From Investment Operations
Net investment income(b) .......................... .029 .028 .029 .023
-------- ------- ------- -------
Less Dividends
Dividends from net investment income .............. (.029) (.028) (.029) (.023)
-------- ------- ------- -------
Net asset value, end of period .................... $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======= ======= =======
Tax Return
Total investment return based on net asset value(c) 2.90% 2.83% 2.97% 3.48%(d)
Ratios/Supplemental Data
Net assets, end of period (000's omitted) ......... $123,822 $78,775 $89,557 $66,921
Ratio to average net assets of:
Expenses, net of waivers and reimbursements ..... .93% .80% .78% .44%(d)
Expenses, before waivers and reimbursements ..... 1.03% 1.15% 1.15% 1.30%(d)
Net investment income(b) ........................ 2.86% 2.78% 2.91% 3.48%(d)
</TABLE>
<TABLE>
<CAPTION>
Florida Portfolio
------------------------------------
July 28,
Year Ended 1995(a)
June 30, through
--------------------- June 30,
1998 1997 1996
-------- ------- -------
<S> <C> <C> <C>
Net asset value, beginning of period .............. $ 1.00 $ 1.00 $ 1.00
-------- ------- -------
Income From Investment Operations
Net investment income(b) .......................... .028 .030 .030
-------- ------- -------
Less Dividends
Dividends from net investment income .............. (.028) (.030) (.030)
-------- ------- -------
Net asset value, end of period .................... $ 1.00 $ 1.00 $ 1.00
======== ======= =======
Tax Return
Total investment return based on net asset value(c) 2.87% 3.03% 3.32%(d)
Ratios/Supplemental Data
Net assets, end of period (000's omitted) ......... $113,095 $89,149 $91,179
Ratio to average net assets of:
Expenses, net of waivers and reimbursements ..... .93% .65% .58%(d)
Expenses, before waivers and reimbursements ..... 1.06% 1.10% 1.24%(d)
Net investment income(b) ........................ 2.82% 2.97% 3.12%(d)
</TABLE>
- ----------
(a) Commencement of operations.
(b) Net of expenses reimbursed or waived by the Adviser.
(c) 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.
(d) Annualized.
Massachusetts Portfolio
-----------------------
April 17,
Year 1997(a)
Ended through
June 30, June 30,
1998 1997
------- -------
Net asset value, beginning of period ................. $ 1.00 $ 1.00
------- -------
Income From Investment Operations
Net investment income(b) ............................. .028 .007
------- -------
Less: Dividends
Dividends from net investment income ................. (.028) (.007)
------- -------
Net asset value, end of period ....................... $ 1.00 $ 1.00
======= =======
Total Return
Total investment return based on net asset value(c)(d) 2.83% 3.53%
Ratios/Supplemental Data
Net assets, end of period (000's omitted) ............ $27,832 $15,046
Ratio to average net assets of:
Expenses, net of waivers and reimbursements(d) ..... .85% .50%
Expenses, before waivers and reimbursements(d) ..... 1.37% 2.99%
Net investment income(b)(d) ........................ 2.80% 3.47%
- ----------
(a) Commencement of operations.
(b) Net of expenses reimbursed or waived by the Adviser.
(c) 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.
(d) Annualized.
----------
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. Further
information about each Fund's performance is contained in the annual report to
shareholders and Statement of Additional Information which may be obtained
without charge by contacting Alliance Fund Services, Inc. at the address shown
in this prospectus.
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INVESTMENT OBJECTIVES AND POLICIES
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The investment objective of Alliance Money Reserves is maximum current
income to the extent consistent with safety of principal and liquidity. The
investment objectives of each of the other Funds are -- in the following order
of priority -- safety of principal, excellent liquidity and, to the extent
consistent with the first two objectives, maximum current income that is, in the
case of each Portfolio of Alliance Municipal Trust, exempt from income taxation
to the extent described below. As a matter of fundamental policy, each Fund,
except for AMT-Florida and AMT-Massachusetts, 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 (397 days with
respect to ATR, AMT-New Jersey and AMT-Virginia) or less, which maturities may
extend to 397 days. AMT-Florida and AMT-Massachusetts pursue their objectives by
investing in high quality municipal securities having remaining maturities of
397 days or less (which maturities may extend to such greater length of time as
may be permitted from time to time pursuant to Rule 2a-7 ("Rule 2a-7") under the
Investment Company Act of 1940 (the "1940 Act"), as amended). While the
fundamental policies described above and the other fundamental investment
policies described below may not be changed without shareholder approval, each
Fund may, upon notice to shareholders, but without such approval, change
non-fundamental investment policies or create additional classes of shares in
order to establish portfolios which may have different investment objectives.
There can be no assurance that any Fund's objectives will be achieved.
The Funds will comply with Rule 2a-7 of the 1940 Act as amended from time
to time, including the diversification, quality and maturity limitations imposed
by the Rule. The average maturity of each Fund's portfolio cannot exceed 90
days. A more detailed description of Rule 2a-7 is set forth in each Fund's
Statement of Additional Information. 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 Money Reserves
The money market securities in which the Fund invests 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 and bankers' acceptances issued or guaranteed by, or
time deposits maintained at, banks or savings and loan associations (including
foreign branches of U.S. banks or U.S. or foreign branches of foreign banks)
having total assets of more than $500 million; (3) commercial paper, including
variable amount master demand notes, of high quality [i.e., rated A-1 or A-2 by
Standard & Poor's Corporation ("Standard & Poor's"), Prime-1 or Prime-2 by
Moody's Investors Service, Inc. ("Moody's"), Fitch-1 or Fitch-2 by Fitch
Investors Service, Inc., or Duff 1 or Duff 2 by Duff & Phelps Inc. or, if not
rated, issued by U.S. or foreign companies having outstanding debt securities
rated AAA, AA or A by Standard & Poor's, or Aaa, Aa or A by Moody's] and
participation interests in loans extended by banks to such companies; and (4)
repurchase agreements that are collateralized fully as that term is defined in
Rule 2a-7 under the 1940 Act. Repurchase agreements may be entered into only
with those banks (including State Street Bank and Trust Company, the Fund's
Custodian) or broker-dealers ("vendors") that are eligible under the procedures
adopted by the Trustees for evaluating and monitoring the creditworthiness of
such vendors. A repurchase agreement would create a loss to the Fund if, in the
event of a vendor default, the proceeds from the sale of the collateral were
less than the repurchase price. The money market securities in which the Fund
invests may have variable or floating rates of interest ("variable rate
obligations") as permitted by Rule 2a-7. 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 and accrued interest at any time, or at specified
intervals. The Fund follows Rule 2a-7 with respect to the diversification,
quality and maturity of variable rate obligations.
To the extent the Fund purchases money market instruments issued by
foreign entities, consideration will be given to the domestic marketability of
such instruments, and possible interruptions of, or restrictions on, the flow of
international currency transactions.
The Fund may purchase restricted securities that are determined by the
Adviser to be liquid in accordance with procedures adopted by the Trustees of
the Fund, includ-
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ing 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. Restricted
securities are securities subject to contractual or legal restrictions on
resale, such as those arising from an issuer's reliance upon certain exemptions
from registration under the Securities Act.
The Fund 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 the Fund'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 Repurchase agreements not terminable within seven days. As
to illiquid securities, the Fund is subject to a risk that should the Fund
desire to sell them when a ready buyer is not available at a price the Fund
deems representative of their value, the value of the Fund's net assets could be
adversely affected.
The Fund may invest in asset-backed securities that meet its existing
diversification, 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
beneficial interest in a special purpose trust, limited partnership interest, or
commercial paper or other debt securities issued by a special purpose
corporation. Although the securities may have some form of credit or liquidity
enhancement, payments on the securities depend predominately upon collection of
the loans and receivables held by the issuer. It is the Fund'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, the Fund
may not: (1) invest more than 25% of its assets in the securities of issuers
conducting their principal business activities in any one industry although
there is no such limitation with respect to U.S. Government securities or
certificates of deposit, bankers' acceptances and interest bearing savings
deposits; (2) invest more than 5% of its assets in the 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 assets 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.
Government); (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
securities during any periods of abnormally heavy redemption requests; (5)
mortgage, 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
the Fund's assets would be subject to repurchase agreements not terminable
within seven days.
As a matter of operating policy, the Fund may invest no more than 5% of
its total assets in the securities of any one issuer (as determined pursuant to
Rule 2a-7), except that the Fund may invest up to 25% of its total assets in the
first tier securities (as defined in Rule 2a-7) of a single issuer for a period
of up to three business days. Fundamental policy number (2) would give the Fund
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 future.
Alliance Treasury Reserves
The securities in which the Fund invests are: (1) issues of the U. S.
Treasury, such as bills, certificates of indebtedness, notes and bonds; and (2)
repurchase agreements that are collateralized fully as that term is defined in
Rule 2a-7 under the 1940 Act. 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, the Fund's
Custodian. For each repurchase agreement, the Fund requires continual
maintenance of the market value of the underlying collateral in amounts equal
to, or in excess of, the agreement amount. In the event of a dealer default, the
Fund might suffer a loss to the extent that the proceeds from the sale of the
collateral were less than the repurchase price. The Fund may commit up to 15% of
its net assets to the purchase of when-issued U.S. Treasury securities. Delivery
and payment for when-issued securities takes place after the transaction date.
The payment amount and the interest rate that will be received on the
8
<PAGE>
securities are fixed on the transaction date. The value of such securities may
fluctuate prior to their settlement, thereby creating an unrealized gain or loss
to the Fund. The money market securities in which the Fund may invest may have
variable or floating rates of interest ("variable rate obligations") as
permitted by Rule 2a-7. 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 and accrued interest at any time, or at specified
intervals. The Fund 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, the Fund
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 the Fund will not purchase any investment while any such
borrowings exist; (2) pledge, hypothecate or in any manner transfer, as security
for indebtedness, its assets except to secure such borrowings; or (3) enter into
repurchase 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 each Portfolio 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 a Portfolio assumes a temporary defensive position, at least 80% of each
Portfolio's total assets will be invested in such securities (as opposed to the
taxable investments described below). Normally, substantially all of each
Portfolio's income will be tax-exempt as described below (e.g., for 1997, 100%
of the income of each Portfolio was exempt from Federal income taxes). The
average weighted maturity of each Portfolio cannot exceed 90 days. The Fund may
in the future establish additional portfolios which may have different
investment objectives.
The New York Portfolio seeks maximum current income that is exempt from
Federal, New York state and New York City personal income taxes by investing, as
a matter of fundamental policy, not less than 65% of its total assets in a
portfolio of high quality municipal securities issued by New York state or its
political subdivisions.
The California Portfolio seeks maximum current income that is exempt from
Federal and California state personal income taxes by investing, as a matter of
fundamental policy, not less than 65% of its total assets in a portfolio of high
quality municipal securities issued by the State of California or its political
subdivisions.
The Connecticut Portfolio seeks maximum current income that is exempt from
Federal and Connecticut state personal income taxes by investing, as a matter of
fundamental policy, not less than 65% of its total assets in a portfolio of high
quality municipal securities issued by the State of Connecticut or its political
subdivisions.
The New Jersey Portfolio seeks maximum current income that is exempt from
Federal and New Jersey state personal income taxes by investing, as a matter of
fundamental policy, not less than 65% of its total assets in a portfolio of high
quality municipal securities issued by the State of New Jersey or its political
subdivisions. The New Jersey Portfolio will invest not less than 80% of its net
assets in securities the interest on which is exempt from New Jersey personal
income taxes [i.e. New Jersey municipal securities and obligations of the U.S.
Government, its agencies and instrumentalities ("U.S. Government Securities")].
In addition, during periods when Alliance Capital Management L.P. (the
"Adviser") believes that New Jersey municipal securities that meet the New
Jersey Portfolio's standards are not available, it may invest a portion of its
assets in securities whose interest payments are only Federally tax-exempt.
The Virginia Portfolio seeks maximum current income that is exempt from
Federal and Virginia state personal income taxes by investing, as a matter of
fundamental policy, not less than 65% of its total assets in a portfolio of high
quality municipal securities issued by the Commonwealth of Virginia or its
political subdivisions.
The Florida Portfolio seeks maximum current income that is exempt from
Federal income tax and State of
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<PAGE>
Florida intangible tax by investing not less than 65% of its total assets in a
portfolio of high-quality municipal securities issued by Florida or its
political subdivisions.
The Massachusetts Portfolio seeks maximum current income that is exempt
from Federal and Massachusetts state personal income taxes by investing at least
65% of its total assets in high quality municipal securities issued by the
Commonwealth of Massachusetts or its political subdivisions. The Massachusetts
Portfolio may invest in restricted securities that are determined by the Adviser
to be liquid in accordance with procedures adopted by the Trustees, including
securities eligible for resale under Rule 144A under the Securities Act of 1933
(the "Securities Act"). Restricted securities are securities subject to
contractual or legal restrictions on resale, such as those arising from an
issuer's reliance upon certain exemptions from registration under the Securities
Act.
Each Portfolio of the Fund 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 private
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) interest on all
tax-exempt obligations will be included in "adjusted current earnings" of
corporations for AMT purposes. Such bonds have provided, and may continue to
provide, somewhat higher yields than other comparable municipal securities. See
below, "Daily Dividends, Other Distributions, Taxes."
There can be no assurance that the Portfolios will achieve their
investment objectives. Potential investors in the New York, California,
Connecticut, New Jersey, Virginia, Florida and Massachusetts Portfolios should
consider the greater risk of the concentration of such Portfolios versus the
safety that comes with less concentrated investments and should compare yields
available on portfolios of the relevant state's issues with those of more
diversified portfolios, including other states' issues, before making an
investment decision. The Adviser believes that by maintaining each Portfolio's
investments in liquid, short-term, high quality investments, each Portfolio is
largely insulated from the credit risks that exist on long-term municipal
securities of the relevant state. See the Statement of Additional Information
for a more detailed discussion of the financial condition of New York,
California, Connecticut, New Jersey, Virginia, Florida and Massachusetts.
Municipal Securities
The municipal securities in which each Portfolio invests include municipal
notes and short-term municipal bonds. Municipal notes are generally used to
provide for short-term capital needs and generally have maturities of one year
or less. Examples include tax anticipation and revenue anticipation notes, which
are generally issued in anticipation of various seasonal revenues, bond
anticipation notes, and tax-exempt commercial paper. Short-term municipal bonds
may include general obligation bonds, which are secured 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.
A Portfolio 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,
accordingly, 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 billion.
Each Portfolio will comply with Rule 2a-7 with respect to its investments in
variable rate obligations supported by letters of credit.
All of the Fund'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.
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To further enhance the quality and liquidity of the securities in which
the Portfolios invest, such securities frequently are supported by credit and
liquidity 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 institution
could cause a Portfolio's investments backed by that institution to lose value
and affect a Portfolio's share price.
A Portfolio also may invest in stand-by commitments, which may involve
certain expenses and risks, but such commitments are not expected to comprise
more than 5% of any Portfolio's net assets. A Portfolio 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 the respective Portfolio, liquid assets
having value equal to, or greater than, such when-issued securities. 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 delivery 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 purchase of the issue. The value of
when-issued securities may fluctuate prior to their settlement, thereby creating
an unrealized gain or loss to a Portfolio.
Taxable Investments
The taxable investments in which each Portfolio may invest include
obligations of the U.S. Government and its agencies, high quality certificates
of deposit and bankers' acceptances, prime commercial paper, and repurchase
agreements.
Other Investment Policies
No Portfolio of the Fund will invest more than 10% of its net assets in
illiquid securities (including illiquid restricted securities with respect to
the Massachusetts Portfolio). As to these securities, a Portfolio is subject 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 and, with
respect to the Massachusetts Portfolio, securities subject to legal or
contractual restrictions on resale. With respect to the Massachusetts Portfolio,
which may invest in restricted securities, restricted securities determined by
the Adviser to be liquid will not be treated as "illiquid" for purposes of the
restriction on illiquid securities.
The following investment policies are fundamental policies with respect to
each applicable Portfolio except the Massachusetts Portfolio which has adopted
the applicable restrictions as non-fundamental policies. To reduce investment
risk, no Portfolio may invest more than 25% of its total assets in municipal
securities the interest upon which is paid from revenues of similar-type
projects; a Portfolio may not invest more than 5% of its total assets in the
securities of any one issuer except the U.S. Government, although the New York,
California, Connecticut, New Jersey, Virginia, Florida and Massachusetts
Portfolios may invest 50% of their respective total assets in as few as four
issuers (but no more than 25% of total assets in any one issuer); and a
Portfolio may not purchase more than 10% of any class of the voting securities
of any one issuer except those of the U.S. Government.
As a matter of operating policy, each Portfolio may, with respect to 75%
of its assets, invest no more than 5% of its assets in the securities of any one
issuer; the remaining 25% of each such Portfolio's assets may be invested in
securities of one or more issuers provided that they are first tier securities.
Fundamental policy number (ii) with respect to all Portfolios would give the
Portfolios the investment latitude described therein only in the event Rule 2a-7
is further amended in the future.
11
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PURCHASE AND REDEMPTION OF SHARES
- --------------------------------------------------------------------------------
For more information on the purchase and redemption of each Fund's shares,
see such Fund's Statement of Additional Information.
Purchase of Shares
Opening Accounts
Contact Discover Brokerage Direct to open a Fund account. Balances will
appear on your monthly brokerage statement.
Subsequent Investments
A. By Check through Discover Brokerage Direct
Mail or deliver your check, payable to "Discover Brokerage Direct" which
will deposit into the Fund(s). Please designate the appropriate Fund(s) and
indicate your brokerage account number on the check or draft.
B. By Sweep
Discover Brokerage Direct has available an automatic "sweep" for customers
in AMR, ATR, AMT-CA, AMT-CT, AMT-FL, AMT-MA, AMT-NJ, AMT-NY and AMT-VA. If you
request the sweep arrangement, all cash balances of $1.00 or more are moved into
one of the Portfolios on a daily basis. Sales proceeds from trades will be swept
into the designated Portfolio on settlement date.
Redemptions
A. By Contacting Discover Brokerage Direct
Instruct Discover Brokerage Direct to order a withdrawal from your Fund
account and issue a check payable to you.
B. By Sweep
Discover Brokerage Direct's automatic "sweep" moves money from your money
market account automatically to cover securities purchases in your brokerage
account.
C. 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 accrued
dividends) in your Fund account. First you must fill out the Signature Card
which you can obtain from Discover Brokerage Direct. The checkwriting service
enables you to receive the daily dividends declared on the shares to be redeemed
until the day that your check is presented for payment.
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ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------
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. (Eastern 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. (Eastern 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 received 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, you might have difficulty
in reaching Alliance Fund Services, Inc. by telephone in which event you should
issue written instructions to Alliance Fund Services, Inc. at the address shown
in this prospectus. Alliance Fund Services, Inc. is not responsible for the
authenticity of telephone requests to purchase or sell shares. Alliance Fund
Services, Inc. will employ reasonable procedures to verify that tele-
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<PAGE>
phone requests are genuine and could be liable for losses arising from
unauthorized transactions if it failed to do so. Dealers or agents may charge a
commission for handling telephone requests. The telephone service may be
suspended or terminated at anytime without notice.
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
immediately thereafter pro rata to shareholders of that Fund of record via
automatic investment in additional full and fractional shares of that Fund in
each shareholder's account. As such additional shares are entitled to dividends
on following 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 each
Portfolio of Alliance Municipal Trust are not subject to Federal income tax
(other than the AMT). Any exempt interest dividends derived from interest on
municipal securities subject to the AMT will be a specific preference item for
purposes of the Federal individual and corporate AMT. Distributions to residents
of New York out of income earned by the New York Portfolio from New York
municipal securities are exempt from New York state and New York City personal
income taxes. Distributions to residents of California out of income earned by
the California Portfolio from California municipal securities are exempt from
California personal income taxes. Distributions to individuals who are residents
of Connecticut out of income earned by the Connecticut Portfolio from
Connecticut municipal securities are exempt from Connecticut personal income
taxes. Distributions to residents of New Jersey out of income earned by the New
Jersey Portfolio from New Jersey municipal securities or U.S. Government
Securities are exempt from New Jersey state personal income taxes. Distributions
from the New Jersey Portfolio are, however, subject to the New Jersey
Corporation Business (Franchise) Tax and the New Jersey Corporation Income Tax
payable by corporate shareholders. Distributions to residents of Virginia out of
income earned by the Virginia Portfolio from Virginia municipal securities or
obligations of the United States or any authority, commission or instrumentality
of the United States are exempt from Virginia individual, estate, trust, or
corporate income tax. Dividends paid by the Florida Portfolio to individual
Florida shareholders will not be subject to Florida income tax, which is imposed
only on corporations. However, Florida currently imposes an "intangible tax" at
the rate of $2.00 per $1,000 taxable value of certain securities, such as shares
of the Portfolio, and other intangible assets owned by Florida residents. U.S.
Government securities and Florida municipal securities are exempt from this
intangible tax. It is anticipated that the Florida Portfolio shares will qualify
for exemption from the Florida intangible tax. In order to so qualify, the
Florida Portfolio must, among other things, have its entire portfolio invested
in U.S. Government securities and Florida municipal securities on December 31 of
any year. Exempt-interest dividends paid by the Florida Portfolio to corporate
shareholders will be subject to Florida corporate income tax. Distributions to
residents of Massachusetts out of interest earned by the Massachusetts Portfolio
from Massachusetts municipal securities are exempt from Massachusetts state
personal income taxes. Distributions out of taxable interest income, other
investment income, and short-term capital gains are taxable to you as ordinary
income and distributions 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. Distributions 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 information 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
provide investment advice and, in general, to supervise its management and
investment program, subject to the general control of the Trustees of each Fund.
For the fiscal year ended June 30, 1998, AMR, ATR, AMT-NY, AMT-CA, AMT-CT,
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AMT-NJ, AMT-VA, AMT-FL and AMT-MA, each paid the Adviser an advisory fee (net of
reimbursement for AMR, ATR, AMT-NY, AMT-CT, AMT-NJ, AMT-VA, AMT-FL and AMT-MA)
at an annual rate of .48, .49, .47, .50, .41, .41, .44, .40 and .08 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 June 30, 1998 of more than $262 billion (of
which more than $107 billion represented the assets of investment companies).
The Adviser's clients are primarily major corporate employee benefit funds,
public employee retirement systems, investment companies, foundations and
endowment funds. The 58 registered investment companies managed by the Adviser
comprising 123 separate investment portfolios currently have more than 3.5
million shareholders. As of June 30, 1998, the Adviser was retained as an
investment manager for employee benefit plan assets for 32 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
average daily net assets. For the period ended June 30, 1998, AMR, ATR, AMT-NY,
AMT-CA, AMT-CT, AMT-NJ, AMT-VA, AMT-FL and AMT-MA each paid the Adviser a
distribution services fee at an annual rate of .25, .20, .21, .24, .21, .21,
.21, .22 and .14 of 1%, respectively, of the average daily value of the net
assets of each Portfolio. Substantially all such monies (together with
significant amounts from the Adviser's own resources) are paid by the Adviser to
broker-dealers and other financial 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 expenses 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
Company, 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
Distributors, 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.
Year 2000. Many computer systems and applications in use today process
transactions using two digit date fields for the year of the transaction, rather
than the full four digits. If these systems are not modified or replaced,
transactions occurring after 1999 could be processed as year "1900," which could
result in processing inaccuracies and computer system failures. This is commonly
known as the Year 2000 problem. Should any of the computer systems employed by
the Funds' major service providers fail to process Year 2000 information
properly, that could have a significant negative impact on the Funds' operations
and the services that are provided to the Funds' shareholders.
With respect to the Year 2000, the Funds have been advised that the
Adviser, Distributor and Transfer Agent (collectively, "Alliance") began to
address the Year 2000 issue several years ago in connection with the replacement
or upgrading of certain computer systems and applications. During 1997, Alliance
began a formal Year 2000 initiative, which established a structured and
coordinated process to deal with the Year 2000 issue. Alliance reports that it
has completed its assessment of the Year 2000 issues on its domestic and
international computer systems and applications. Currently, management of
Alliance expects that the required modifications for the majority of
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its significant systems and applications that will be in use on January 1, 2000,
will be completed and tested by the end of 1998. Full integration testing of
these systems and testing of interfaces with third party suppliers will continue
through 1999. At this time, management of Alliance believes that the costs
associated with resolving this issue will not have a material adverse effect on
its operations or on its ability to provide the level of services it currently
provides to the Funds.
The Funds and Alliance have been advised by the Funds' Custodian that it
is also in the process of reviewing its systems with the same goals. As of the
date of this prospectus, the Funds and Alliance have no reason to believe that
the Custodian will be unable to achieve these goals.
Fund Organization. Alliance Government Reserves (not offered by this
prospectus) and ATR 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 previously been a Maryland corporation since its formation in December
1978. Alliance Capital Reserves (not offered by this prospectus) and AMR are
series of Alliance 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-NY, AMT-CA, AMT-CT, AMT-NJ,
AMT-VA, AMT-FL and AMT-MA are non-diversified series of Alliance Municipal
Trust, which is also an open-end management investment company registered under
the 1940 Act consisting of such series and one 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 each series of Alliance Municipal Trust, Alliance Government Reserves
and Alliance Capital Reserves are entitled to one vote per share, and vote as a
single series, on matters that affect each series in substantially the same
manner. 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
theoretically 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.
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