<PAGE>
ALLIANCE MUNICIPAL TRUST
This is filed pursuant to Rule 497(e).
File Nos: 002-79807 and 811-03586
<PAGE>
YIELDS
For current recorded yield
information on the Funds, call
toll-free (800) 221-9513.
The Funds are open-end management
investment companies with invest-
ment objectives of safety, liquid-
ity and maximum current income (in
the case of Alliance Municipal
Trust-General, exempt from Federal
income taxes and, in the case of
the Florida Portfolio, exempt from
Federal and state income taxes) to
the extent consistent with the
first two objectives. Alliance Cap-
ital Reserves, Alliance Government
Reserves and the General Portfolio
of Alliance Municipal Trust are di-
versified. The Florida Portfolio of
Alliance Municipal Trust is non-di-
versified and is offered only to
residents of Florida. This prospec-
tus sets forth the information
about each Fund that a prospective
investor should know before invest-
ing. 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 de-
posit or obligation of, or guaran-
teed or endorsed by, any bank; and
(iii) not federally insured by the
Federal Deposit Insurance Corpora-
tion, 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 Flor-
ida Portfolio may invest a signifi-
cant portion of its assets in the
securities of a single issuer. Ac-
cordingly, an investment in such
Portfolio may be riskier than an
investment in other types of money
market funds.
A "Statement of Additional Infor-
mation" for each Fund dated Novem-
ber 1, 1996, which provides a fur-
ther 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 ref-
erence. A free copy may be obtained
by contacting your Investment Offi-
cer.
THESE SECURITIES HAVE NOT BEEN AP-
PROVED OR DISAPPROVED BY THE SECU-
RITIES 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
------
<TABLE>
<S> <C>
Expense Information....................................................... 2
Financial Highlights...................................................... 3
Investment Objectives and Policies........................................ 6
Purchase and Redemption of Shares......................................... 9
Additional Information.................................................... 10
</TABLE>
NOVRWB1996
[LOGO OF BAIRD APPEARS HERE]
Introduces . . .
- ------------------------------------------
. ALLIANCE CAPITAL RESERVES
. ALLIANCE GOVERNMENT RESERVES
. ALLIANCE MUNICIPAL TRUST--
GENERAL PORTFOLIO
FLORIDA PORTFOLIO
PROSPECTUS
NOVEMBER 1, 1996
- ------------------------------------------
ROBERT W. BAIRD & CO. INCORPORATED,
777 E. WISCONSIN AVE.
MILWAUKEE, WI 53202, PHONE 414-765-3500
MEMBER NEW YORK STOCK EXCHANGE, INC.
OTHER PRINCIPAL EXCHANGES. MEMBER 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, ACR AGR AMT-GEN AMT-FL
after expense reimbursement) --- ---- ------- ------
<S> <C> <C> <C> <C>
Management Fees................................... .46% .48% .50% .50%
12b-1 Fees........................................ .25 .25 .25 .25
Other Expenses.................................... .29 .27 .25 .25
---- ---- ---- ----
Total Fund Operating Expenses..................... 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):
<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
AMT--Florida................................. $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 expenses listed in the table for ACR and AMT-FL are
net of the contractual reimbursement by the Adviser described in this prospec-
tus. The expenses of such Portfolios, before expense reimbursements, would be:
ACR: Management Fee--.47%, 12b-1 Fees--.25%, Other Expenses--.29% and Total
Operating Expenses--1.01% and AMT-FL: Management Fee--.50%, 12b-1 Fees--.25%,
Other Expenses--.34% and Total Operating Expenses--1.09%. 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 --------------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------ ------ ------ ------ ------ ------ ------ ------ ------- -------
<S> <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
------ ------ ------ ------ ------ ------ ------ ------ ------- -------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... .0471 .0447 .0255 .0266 .0438 .0662 .0782 .0788 0.0625 0.0549
Net realized gain on
investments............. -0- -0- -0- .0003 .0013 -0- -0- -0- -0- -0-
------ ------ ------ ------ ------ ------ ------ ------ ------- -------
Net increase in net
assets from operations.. .0471 .0447 .0255 .0269 .0451 .0662 .0782 .0788 0.0625 0.0549
------ ------ ------ ------ ------ ------ ------ ------ ------- -------
LESS: DISTRIBUTIONS
Dividends from net
investment income....... (.0471) (.0447) (.0255) (.0266) (.0438) (.0662) (.0782) (.0788) (0.0625) (0.0549)
Distributions from net
realized gains.......... -0- -0- -0- (.0003) (.0013) -0- -0- -0- -0- -0-
------ ------ ------ ------ ------ ------ ------ ------ ------- -------
Total dividends and
distributions........... (.0471) (.0447) (.0255) (.0269) (.0451) (.0662) (.0782) (.0788) (0.0625) (0.0549)
------ ------ ------ ------ ------ ------ ------ ------ ------- -------
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
====== ====== ====== ====== ====== ====== ====== ====== ======= =======
TOTAL RETURNS
Total investment return
based on:
Net asset value(a)...... 4.82% 4.57% 2.58% 2.73% 4.61% 6.84% 8.14% 8.20% 6.45% 5.64%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year
(in millions)........... $4,804 $3,024 $2,417 $2,112 $1,947 $1,937 $1,891 $1,536 $1,392 $1,458
Ratio to average net
assets of:
Expenses, net of waivers
and reimbursements..... 1.00% 1.00% 1.00% 1.00% 1.00% .97% .88% .95% .95% .99%
Expenses, before waivers
and reimbursements..... 1.00% 1.03% 1.03% 1.00% 1.00% .97% .98% 1.05% 1.05% 1.09%
Net investment
income(b).............. 4.69% 4.51% 2.57% 2.65% 4.37% 6.62% 7.82% 7.87% 6.26% 5.50%
</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>
ALLIANCE GOVERNMENT YEAR ENDED JUNE 30,
RESERVES ---------------------------------------------------------------------------------------
1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
------ ------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, begin-
ning of period......... $ 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... .0461 .0439 .0244 .0256 .0421 .0640 .0765 .0774 0.0612 0.0541
Net realized gain on in-
vestments.............. -0- -0- -0- .0001 -0- -0- .0001 -0- -0- -0-
------ ------- ------- ------- ------- ------- ------- ------- ------- -------
Net increase in net
assets from operations. .0461 .0439 .0244 .0257 .0421 .0640 .0766 .0774 0.0612 0.0541
------ ------- ------- ------- ------- ------- ------- ------- ------- -------
LESS: DISTRIBUTIONS
Dividends from net in-
vestment income........ (.0461) (.0439) (.0244) (.0256) (.0421) (.0640) (.0765) (.0774) (0.0612) (0.0541)
Distributions from net
realized gains......... -0- -0- -0- (.0001) -0- -0- (.0001) -0- -0- -0-
------ ------- ------- ------- ------- ------- ------- ------- ------- -------
Total dividends and dis-
tributions............. (.0461) (.0439) (.0244) (.0257) (.0421) (.0640) (.0766) (.0774) (0.0612) (0.0541)
------ ------- ------- ------- ------- ------- ------- ------- ------- -------
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
====== ======= ======= ======= ======= ======= ======= ======= ======= =======
TOTAL RETURNS
Total investment return
based on:
Net asset value(a)..... 4.72% 4.48% 2.48% 2.60% 4.30% 6.61% 7.96% 8.04% 6.31% 5.56%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of year
(in millions).......... $3,205 $2,514 $2,061 $1,783 $1,572 $1,070 $584 $522 $315 $260
Ratio to average net as-
sets of:
Expenses, net of
waivers and
reimbursements........ 1.00% 1.00% 1.00% 1.00% .95% .89% .88% .88% .80% .95%
Expenses, before
waivers and
reimbursements........ 1.01% 1.05% 1.04% 1.02% .97% .93% .98% .98% .90% 1.05%
Net investment
income(b)............. 4.60% 4.42% 2.46% 2.55% 4.17% 6.28% 7.65% 7.86% 6.13% 5.41%
</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>
GENERAL PORTFOLIO
ALLIANCE MUNICIPAL TRUST ------------------------------------------------------------------------------------------------
YEAR ENDED
YEAR ENDED JUNE 30, SIX MONTHS DECEMBER 31,
--------------------------------------------------------- ENDED ----------------------
1996 1995 1994 1993 1992 1991 1990 JUNE 30, 1989 1988 1987 1986
------ ------ ------ ------ ------ ------ ------ ------------- ------ ------ ------
<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... .029 .028 .018 .020 .034 .046 .055 .030 .047 .041 .044
Net realized and
unrealized loss on
investments............ -0- (.003) -0- -0- -0- -0- -0- -0- -0- -0- -0-
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net increase in net
asset value from
operations............. .029 .025 .018 .020 .034 .046 .055 .030 .047 .041 .044
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
ADD: CAPITAL
CONTRIBUTIONS
Capital Contributed by
the Adviser............ -0- .003 -0- -0- -0- -0- -0- -0- -0- -0- -0-
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
LESS: DISTRIBUTIONS
Dividends from net
investment income...... (.029) (.028) (.018) (.020) (.034) (.046) (.055) (.030) (.047) (.041) (.044)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
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)............... 2.93% 2.83%(c) 1.81% 2.05% 3.48% 4.71% 5.65% 6.13%(b) 4.81% 4.18% 4.50%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of
period (in millions)... $1,148 $1,189 $1,134 $1,016 $914 $883 $798 $695 $633 $690 $794
Ratio to average net
assets of:
Expense, net of waivers
and reimbursements.... .95% .94% .92% .92% .92% .89% .83% .84%(b) .83% .80% .80%
Expense, before waivers
and reimbursements.... .95% .95% .94% .94% .95% .95% .93% .94%(b) .93% .90% .90%
Net investment
income(d)............. 2.90% 2.78% 1.80% 2.02% 3.40% 4.57% 5.50% 5.96%(b) 4.69% 4.08% 4.31%
</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 has no effect on total return.
(d) Net of expenses reimbursed or waived by the Adviser.
4
<PAGE>
<TABLE>
<CAPTION>
FLORIDA PORTFOLIO
-----------------
JULY 28, 1995(A)
THROUGH
JUNE 30, 1996
-----------------
<S> <C>
Net asset value, beginning of period.......................... $ 1.00
-------
INCOME FROM INVESTMENT OPERATIONS
Net investment income......................................... .030
-------
LESS DISTRIBUTIONS
Dividends from net investment income.......................... (.030)
-------
Net asset value, end of period................................ $ 1.00
=======
TAX RETURNS
Total investment return based on net asset value(b)........... 3.32%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (000's omitted)..................... $91,179
Ratio to average net assets of:
Expenses, net of waivers and reimbursements.................. .58%
Expenses, before waivers and reimbursements.................. 1.24%
Net investment income(d)..................................... 3.12%
</TABLE>
- -------
(a) Commencement of operations.
(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 re-
demption on the last day of the period.
(c) Annualized.
(d) Net of expenses reimbursed or waived by the Adviser.
---------------
From time to time the 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, 1996 amounted to an annualized yield
of 4.44%, equivalent to an effective yield of 4.54%. For AGR dividends for the
seven days ended June 30, 1996, after expense reimbursement, amounted to an
annualized yield of 4.38%, equivalent to an effective yield of 4.48%. Absent
such reimbursement, the annualized yield for such period would have been
4.29%, equivalent to an effective yield of 4.38%. For AMT-General dividends
for the seven days ended June 30, 1996, after expense reimbursement, amounted
to an annualized yield of 2.74%, equivalent to an effective yield of 2.78%.
Absent such reimbursement, the annualized yield for such period would have
been 2.69%, equivalent to an effective yield of 2.73%. For AMT-Florida divi-
dends for the seven days ended June 30, 1996, after expense reimbursement,
amounted to an annualized yield of 2.92%, equivalent to an effective yield of
2.96%. Absent such reimbursement, the annualized yield for such period would
have been 2.49%, equivalent to an effective yield of 2.52%.
5
<PAGE>
INVESTMENT OBJECTIVES AND POLICIES
Each Fund's investment objectives are--in the following order of priority--
safety of principal, excellent liquidity, and maximum current income (exempt
from Federal income taxes, in the case of Alliance Municipal Trust--General
and Alliance Municipal Trust--Florida) to the extent consistent with the first
two objectives. As a matter of fundamental policy (with respect to Alliance
Capital Reserves, Alliance Government Reserves and Alliance Municipal Trust--
General), 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. The Florida Portfolio pursues its objectives by investing in high qual-
ity municipal securities having remaining maturities of 397 days or less
(which maturities may extend to such greater length of time as may be permit-
ted from time to time pursuant to Rule 2a-7 under the Investment Company Act
of 1940 (the "1940 Act"), as amended). While the fundamental policies de-
scribed 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 portfo-
lios which may have different investment objectives. There can be no assurance
that any Fund 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.
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 the Fund may invest; (3) commercial paper 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 Service, Inc. ("Moody's") or, if not rated, is-
sued by companies having outstanding debt securities rated AAA or AA by Stan-
dard & 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 Custodian, and would create a loss
to the Fund 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 deposits 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.
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.
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 invest in asset-backed securities that meet its existing diversifi-
cation, quality and maturity criteria.
6
<PAGE>
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 securi-
ties issued by a special purpose corporation. Although the securities may have
some form of credit or liquidity enhancement, payments on the securities de-
pend predominately upon collection of the loans and receivables held by the
issuer. It is ACR's current intention to limit its investment in such securi-
ties 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 as-
sets in the securities of issuers conducting their principal business activi-
ties 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 securities of any one issuer (except the U.S. Government) although with re-
spect to one-quarter 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 is-
suer (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 ag-
gregate 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; or (5) mortgage, pledge or hypothecate its assets
except to secure such borrowings.
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 the Fund 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 secu-
rities, whose value may fluctuate prior to their settlement, thereby creating
an unrealized gain or loss to the Fund.
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 aggre-
gate amounts not exceeding 10% of its assets and to be used exclusively to fa-
cilitate 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 it will not purchase
any investment while any such borrowings exist; or (2) pledge, hypothecate or
in any manner transfer, as security for indebtedness, its assets except to se-
cure such borrowings.
ALLIANCE MUNICIPAL TRUST
The investment objectives of each Portfolio are safety of principal, liquid-
ity and, to the extent consistent with these objectives, maximum current in-
come that is exempt from income taxation to the extent described below. Except
when a Portfolio assumes a temporary defensive position, as a matter of funda-
mental policy, at least 80% of the Portfolio's total assets will be invested
in municipal securities (as opposed to the taxable investments described be-
low). Normally, substantially all of each Portfolio's income will be tax-ex-
empt as described below (e.g., for 1995, 100% of the income of each Portfolio
was exempt from Federal income taxes).
7
<PAGE>
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.
The Florida Portfolio seeks maximum current income that is exempt from Fed-
eral income tax and State of 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.
Each Portfolio of the Fund may invest without limitation in tax-exempt mu-
nicipal 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."
There can be no assurance that the Portfolios will achieve their investment
objectives. Potential investors in the Florida Portfolio should consider the
greater risk of the concentration of such Portfolio 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 deci-
sion. The Adviser believes that by maintaining the Florida Portfolio's invest-
ments in liquid, short-term, high quality investments, the Portfolio is
largely insulated from the credit risks that exist on long-term municipal se-
curities of the relevant state. See the Statement of Additional Information
for a more detailed discussion of the financial condition of Florida.
Municipal Securities. The municipal securities in which each Portfolio in-
vests 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 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.
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, 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. The letters of credit of any single bank in respect of all variable rate
obligations will not cover more than 10% of a Portfolio's total assets.
Each Portfolios' 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 Corpora-
tion (AAA and AA or SP-1 and SP-2), or judged by the Adviser to be of compara-
ble quality. Securities must also meet credit standards applied by the
Adviser.
To further enhance the quality and liquidity of the securities in which the
Portfolios invest, 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.
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A Portfolio 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 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 custo-
dian will maintain, in a separate account of the respective Portfolio, liquid
high-grade debt securities having value equal to, or greater than, such when-
issued securities. The price of when-issued securities, which is generally ex-
pressed 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 fluc-
tuate prior to their settlement, thereby creating an unrealized gain or loss
to a Portfolio.
Taxable Investments. The taxable investments in which each Portfolio may in-
vest 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 Fundamental Investment Policies. To reduce investment risk, the Gen-
eral Portfolio may not invest more than 25% of its total assets in municipal
securities whose issuers are located in the same state, and 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 (i) with respect to 25% of its total as-
sets the General Portfolio may invest up to 10% per issuer, and (ii) the Flor-
ida 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.
PURCHASE AND REDEMPTION OF SHARES
OPENING ACCOUNTS
Instruct your Investment Officer to use ACR, AGR, AMT-General, or AMT-Flor-
ida in conjunction with your brokerage account.
SUBSEQUENT INVESTMENTS
A. BY CHECK THROUGH BAIRD
Mail or deliver your check or negotiable draft (minimum $500), made payable
to "Robert W. Baird & Co." to your Investment Officer who will deposit it into
the Fund(s). Please indicate your brokerage account number on the check or
draft.
B. BY SWEEP
Baird has available an automatic "sweep" for the Funds in the operation of
brokerage accounts for its customers. If you qualify for the sweep arrange-
ment, once a week proceeds from sale transactions, as well as other credit
balances in your Baird brokerage account, will be swept into your money market
fund.
C. BY CONTACTING YOUR INVESTMENT OFFICER
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 Investment Officer either specifically each time that you know
there is a cash balance or by providing standing instructions to your Invest-
ment Officer to immediately move all such cash to the Funds.
REDEMPTIONS
A. BY CONTACTING YOUR INVESTMENT OFFICER
Instruct your Investment Officer to order a with- drawal from your Fund
account to purchase securities or to make payment with a Baird check either to
you or to your designated payee.
B. BY CHECKWRITING
With this service, you may write checks made payable to any payee in any
amount of $100 or more. Checks
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cannot be written for more than the principal balance (not including any ac-
crued dividend) in your account. First you must fill out the Signature Card
which you can obtain from your Investment Officer. There is no separate charge
for the checkwriting service. The checkwriting service enables you to receive
the daily dividend declared on the shares to be redeemed until the day that
your check is presented for payment.
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. (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 (amor-
tized cost value is used for this purpose) and any cash or other assets, sub-
tracting 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.
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 re-
sponsible for the authenticity of telephone requests to purchase or sell
shares. Alliance Fund Services, Inc. will employ reasonable procedures in or-
der 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
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 AMT-General
and AMT-Florida are not subject to Federal income tax (other than the AMT),
but, in the case of the General Portfolio, may be subject to state or local
income taxes. 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. 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 as-
sets owned by Florida residents. U.S. Government securities and Florida munic-
ipal securities are exempt from this intangible tax. It is anticipated that
the Florida Portfolio shares will qualify for exemption from the Florida in-
tangible tax.
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In order to so qualify, the Florida Portfolio must, among other things, have
its entire portfolio invested in U.S. Government securities and Florida munic-
ipal 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 out of taxable interest income, other in-
vestment 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 distribu-
tions for the year just ended.
The Adviser. Each Fund retains Alliance Capital Management L. P., 1345 Ave-
nue of the Americas, New York, NY 10105 under separate Advisory Agreements to
provide investment advice and, in general, to supervise its management and in-
vestment program, subject to the general control of the Trustees of each Fund.
For the fiscal year ended June 30, 1996, ACR, AGR and AMT-General each paid
the Adviser an advisory fee at an annual rate of .47, .48 and .50 of 1%, re-
spectively, of the average daily value of the respective Portfolio's net as-
sets.
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 fiscal year ended June 30, 1996, ACR, AGR,
AMT-General and AMT-Florida each paid the Adviser a distribution services fee
at an annual rate of .25, .24, .25 and .15 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 ad-
ministrative 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 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.
FUND ORGANIZATION. AGR and ATR (not offered by this prospectus) are series
of Alliance Government Reserves which is a diversified open-end management in-
vestment company registered under the 1940 Act. The Fund was reorganized as a
Massachusetts business trust in October 1984, having previously been a Mary-
land corporation since its formation in December 1978. ACR and AMR (not of-
fered by this prospectus) are series of Alliance Capital Reserves, a diversi-
fied 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 and AMT-Florida is a non-diversified series of Alli-
ance Municipal Trust consisting of five other series not offered by this pro-
spectus, which is also an open-end management investment company registered
under the 1940 Act. The Fund was reorganized as a Massachusetts business trust
in April 1985, having previously been a Maryland corporation since its forma-
tion in January 1983. Each Fund's activities are supervised by its Trustees.
Normally, shares of each series of Alliance Municipal Trust, Alliance Govern-
ment 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 sub-
stantially the same manner. Massachusetts law does not require annual meetings
of shareholders and it is anticipated that shareholder meetings will be held
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<PAGE>
only when required by Federal law. Shareholders have available certain proce-
dures 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. You can arrange for a copy of each of your
account statements to be sent to other parties.
MANAGED ASSETS PLAN ("MAP"). The Funds offer their customers MAP, which is a
special cash management service linked to the Funds. Among various features of
MAP, the shareholder has direct access to his Fund balance (1) with a Visa
Gold Card that is accepted worldwide by participating merchants, banks and au-
tomated teller machines and (2) by MAP checks which can be written for any
amount up to the balance in the account, with no restriction on the number of
checks. Details of MAP, including its annual fee, are available by contacting
your Investment Officer.
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.
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