As filed with the Securities and Exchange Commission
on June 10, 1998
Registration No. 2-96408
811-4254
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
[ ] Pre-Effective Amendment No.
[X] Post-Effective Amendment No. 50
REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940, as amended
Amendment No. 51 [X]
SMITH BARNEY INCOME FUNDS
(Exact name of Registrant as Specified in Charter)
388 Greenwich Street, New York, New York 10013
(Address of principal executive offices) (Zip Code)
(212)816-6474
(Registrant's telephone number, including Area Code)
Christina T. Sydor
Secretary
Smith Barney Income Funds
388 Greenwich Street
New York, New York 10013, 22nd Floor
(Name and address of agent for service)
(Approximate Date of Proposed Public Offering): Continuous
It is proposed that this filing becomes effective (check appropriate
box):
[ ] Immediately upon filing pursuant to paragraph b
[X] on June 15, 1998 pursuant to paragraph b
[ ] 60 days after filing pursuant to paragraph (a)(1)
[ ] on (date) pursuant to paragraph (a)(1)
[ ] 75 days after filing pursuant to paragraph (a)(2)
[ ] on (date) pursuant to paragraph (a) (2) of Rule 485
If appropriate, check the following box:
[ ] This post-effective amendment designates a new effective date
for a previously filed post-effective amendment
Title of Securities Being Registered: Shares of Common Stock/Shares
of Beneficial Interest
SMITH BARNEY INCOME FUNDS
CONTENTS OF REGISTRATION STATEMENT
This Registration Statement contains the following pages and
documents:
Front Cover
Contents Page
Cross-Reference Sheet
Part A - Prospectus
Part B - Statement of Additional Information
Part C - Other Information
Signature Page
Exhibits
SMITH BARNEY INCOME FUNDS
FORM N-1A CROSS REFERENCE SHEET
Pursuant to Rule 495(a) Under the Securities Act of 1933, as amended
Part A
Item No. and Caption Prospectus Caption
1. Cover Page Cover Page
2. Synopsis Prospectus Summary
3. Condensed Financial Information Financial Highlights;
4. General Description of Registrant Cover Page; Prospectus
Summary;
Investment Objective and
Policies;
Distributor; Additional
Information
5. Management of the Fund Prospectus Summary; Management of
the Trust and the Fund;
Distributor; Additional Information
6. Capital Stock and Other Securities Investment Objective and
Policies; Dividends,
Distributions and Taxes;
Additional Information
7. Purchase of Securities Valuation of Shares;
Being Offered Purchase of Shares;
Exchange Privilege; Redemption of
shares; Purchase, Exchange and
Redemption of Shares; Minimum
Account Size; Distributor
8. Redemption or Repurchase of Shares Purchase of Shares;
Redemption of Shares;
Exchange Privilege;
Purchase, Exchange and
Redemption of Shares
9. Pending Legal Proceedings Not Applicable
Part B.
Item No. and Caption Statement of Additional
Information Caption
10. Cover Page Cover page
11. Table of Contents Contents
12. General Information and History Distributor; Additional
Information
13. Investment Objectives and Policies Investment Objectives and
Management Policies
14. Management of the Fund Management of the Trust and the
Funds; Distributor
15. Control Persons and Principal Holders of Securities
Management of the Trust and the
Funds
16. Investment Advisory and Management of the Trust and
Other Services the Funds; Distributor
17. Brokerage Allocation Investment Objectives and
Management Policies; Distributor
18. Capital Stock and Other Securities Investment Objectives and
Management Policies; Purchase of
Shares; Redemption of Shares;
Taxes
19. Purchase, Redemption and Pricing Purchase of Shares; Redemption of
of Securities Being Offered Shares; Valuation of Shares;
Distributor; Exchange Privilege
20. Tax Status Taxes
21. Underwriters Distributor
22. Calculation of Performance Data Performance Data
23. Financial Statements Financial Statements
SMITH BARNEY INCOME FUNDS
PART A
SMITH BARNEY BALANCED FUND (the "Fund")
Supplement dated June 15, 1998 to the Prospectus
Dated November 28, 1997
The following information supplements, and to the extent
inconsistent therewith, supercedes the information in the
Prospectus under "Prospectus Summary-Alternative Purchase
Arrangements."
CLASS L SHARES. Class L shares are sold
at net asset value plus an initial sales
charge of 1%. They are subject to an
annual service fee of 0.25% and an annual
distribution fee of 0.75% of the average
daily net assets of the Class. Investors
pay a CDSC of 1% if they redeem Class L
shares within 12 months of purchase.
The following information supplements, and to the extent
inconsistent therewith, supercedes the information in the
Prospectus under "Prospectus Summary-The Fund's Expenses."
THE FUND'S EXPENSES The following expense table lists the costs and
expenses an investor will incur either directly or indirectly as
a shareholder of the Fund, based on the maximum sales charge or
maximum CDSC that may be incurred at the time of purchase or
redemption and the Fund's operating expenses for its most recent
fiscal year:
Smith Barney
Balanced Fund Class Class Class Class
Class
Shareholder A B L*** O****
Y
Transaction
Expenses
Maximum sales
charge imposed
on purchases
(as a percentage
of offering price) 5.00% None 1.00% 1.00% None
Maximum CDSC
(as a percentage of
original cost or
redemption proceeds,
whichever is lower) None* 5.00% 1.00% 1.00% None
Annual Fund
Operating Expense
(as a percentage
of average net assets)
Management fees 0.65% 0.65% 0.65% 0.65% 0.65%
12b-1 fees** 0.25 0.75 1.00 0.70 None
Other expenses 0.16 0.12 0.11 0.12 0.02
TOTAL FUND
OPERATING
EXPENSES 1.06% 1.52% 1.76% 1.47% 0.67%
? Purchase of Class A shares of $500,000 or more will be made at
net asset value with no sales charge, but will be subject to a
CDSC of 1.00% on redemptions made within 12 months of
purchase.
** Upon conversion of Class B shares to Class A shares, such
shares will no longer be subject to a distribution fee. Class
L and Class O shares do not have a conversion feature and,
therefore, are subject to an ongoing distribution fee. As a
result, long-term shareholders of Class L and Class O shares
may pay more than the economic equivalent of the maximum
front-end sales charge permitted by the National Association
of Securities Dealers, Inc.
*** Class L shares "Other Expenses" have been estimated because
no Class L shares were outstanding during the fiscal year
ended December 31, 1997
****Class O shares were formerly designated Class C Shares.
Class O shares are available to purchase only by former Class
C shareholders. Purchasers of Class O shares will be subject
to a 1% sales charge after June 25, 1999.
EXAMPLE
The following example is intended to assist an investor in
understanding the various costs that an investor in the Fund will
bear directly or indirectly. The example assumes payment by the
Fund of operating expenses at the levels set forth in the table
above. See "Purchase of Shares," "Redemption of Shares" and
"Management of the Fund."
An investor would pay the following expenses on a $1,000
investment,
assuming (1) 5.00% annual return and
(2) redemption at the end of each time period:
1 3 5 10
Year Years Years Years
Class A $60 $82 $106 $173
Class B 65 78 93 169
Class L 29 58 101 218
Class O 25 46 80 176
Class Y 7 21 37 83
An investor would pay the following expenses on the same
investment,
assuming the same annual return and no redemption:
1 3 5 10
Year Years Years Years
Class A $60 $82 $106 $173
Class B 15 48 83 169
Class L 19 58 101 218
Class O 15 46 80 176
Class Y 7 21 37 83
? Ten-year figures assume conversion of Class B shares to Class
A shares at the end of the eighth year following the date of
purchase.
The example also provides a means for the investor to
compare expense levels of funds with different fee structures
over varying investment periods. To facilitate such comparison,
all funds are required to utilize a 5.00% annual return
assumption. However, the Fund's actual return will vary and may
be greater or less than 5.00%. This example should not be
considered a representation of past or future expenses and actual
expenses may be greater or less than those shown.
The following information supplements, and to the extent
inconsistent therewith, supercedes the information in the
Prospectus under "Exchange Privilege."
Class L and Class O shares may be
exchanged with Class L shares of other
Smith Barney Mutual Funds.
The following information supplements, and to the extent
inconsistent therewith, supercedes the information in the
Prospectus under "Additional Information."
Class L shares are subject to the same
terms and conditions as other classes of
the Fund as outlined in the Prospectus.
FINANCIAL HIGHLIGHTS
The following information for each of the years in the three-
year period
ended July 31, 1997 has been audited by KPMG Peat Marwick LLP,
independent
auditors, whose report thereon appears in the Fund's Annual
Report dated July
31, 1997. The following information for the period ended January
31, 1998 is
unaudited. The following information for the fiscal years ended
July 31, 1989
through July 31, 1994 has been audited by other independent
auditors. The
information set out below should be read in conjunction with the
financial
statements and related notes that also appear in the Fund's 1997
Annual Report,
which is incorporated by reference into the Statement of
Additional Informa-
tion.
FOR A CLASS A SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT
EACH YEAR:
<TABLE>
<CAPTION>
SMITH BARNEY BALANCED FUND
YEAR ENDED 1998(1) 1997 1996 1995
1994 1993(2)
- -----------------------------------------------------------------
- ----------------
<S> <C> <C> <C> <C>
<C> <C>
NET ASSET VALUE, BEGINNING
OF YEAR $15.53 $14.51 $14.03 $13.28
$15.97 $14.36
- -----------------------------------------------------------------
- ----------------
INCOME (LOSS) FROM
OPERATIONS:
Net investment income 0.37 0.80 0.83 0.85
0.56 0.66
Net realized and
unrealized gain (loss) on
investments 1.33 1.36 0.47 0.82
(1.92) 1.72
- -----------------------------------------------------------------
- ----------------
Total Income (Loss) From
Operations 1.70 2.16 1.30 1.67
(1.36) 2.38
- -----------------------------------------------------------------
- ----------------
LESS DISTRIBUTIONS FROM:
Net investment income (0.41) (0.82) (0.82) (0.82)
(0.83) (0.64)
Net realized gains (0.60) (0.32) -- (0.08)
(0.50) (0.13)
Capital -- -- -- (0.02)
- -- --
- -----------------------------------------------------------------
- ----------------
Total Distributions (1.01) (1.14) (0.82) (0.92)
(1.33) (0.77)
- -----------------------------------------------------------------
- ----------------
NET ASSET VALUE, END OF
YEAR $16.22 $15.53 $14.51 $14.03
$13.28 $15.97
- -----------------------------------------------------------------
- ----------------
TOTAL RETURN 11.18%++ 15.48% 9.21% 13.24%
(8.99)% 17.01%++
- -----------------------------------------------------------------
- ----------------
NET ASSETS, END OF YEAR
(MILLIONS) $ 261 $ 248 $ 266 $169
$41 $54
- -----------------------------------------------------------------
- ----------------
RATIOS TO AVERAGE NET
ASSETS:
Expenses 1.04%+ 1.06% 1.04% 1.07%
1.07% 1.07%+
Net investment income 4.54+ 5.29 5.55 6.36
5.54 5.67+
- -----------------------------------------------------------------
- ----------------
PORTFOLIO TURNOVER RATE 24% 45% 58% 36%
28% 37%
- -----------------------------------------------------------------
- ----------------
AVERAGE COMMISSIONS PER
SHARE PAID ON EQUITY
TRANSACTIONS (3) $ 0.06 $ 0.06 $ 0.06 --
- -- --
- -----------------------------------------------------------------
- ----------------
</TABLE>
(1) For the six months ended January 31, 1998 (unaudited).
(2) For the period from November 6, 1992 (inception date) to July
31, 1993.
(3) As of September 1995, the SEC instituted new guidelines
requiring the
disclosure of average commissions per share.
++Total return is not annualized as it may not be representative
of the total
return for the year.
+ Annualized.
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A CLASS B SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT
EACH YEAR:
<TABLE>
<CAPTION>
SMITH BARNEY BALANCED FUND
YEAR ENDED 1/31/98(1) 7/31/97 7/31/96 7/31/95
7/31/94 7/31/93 7/31/92(2)
- -----------------------------------------------------------------
- --------------------------------
<S> <C> <C> <C> <C>
<C> <C> <C>
NET ASSET VALUE,
BEGINNING OF YEAR $15.52 $14.51 $14.02 $13.28
$15.97 $14.83 $13.95
- -----------------------------------------------------------------
- --------------------------------
INCOME (LOSS) FROM
OPERATIONS:
Net investment income 0.34 0.73 0.77 0.78
0.75 0.79 0.35
Net realized and
unrealized gain (loss)
on investments 1.32 1.35 0.47 0.82
(2.19) 1.30 0.89
- -----------------------------------------------------------------
- --------------------------------
Total Income (Loss) From
Operations 1.66 2.08 1.24 1.60
(1.44) 2.09 1.24
- -----------------------------------------------------------------
- --------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income (0.37) (0.75) (0.75) (0.76)
(0.75) (0.80) (0.35)
Net realized gains (0.60) (0.32) -- (0.08)
(0.50) (0.15) --
Capital -- -- -- (0.02)
- -- -- (0.01)
- -----------------------------------------------------------------
- --------------------------------
Total Distributions (0.97) (1.07) (0.75) (0.86)
(1.25) (0.95) (0.36)
- -----------------------------------------------------------------
- --------------------------------
NET ASSET VALUE, END OF
YEAR $16.21 $15.52 $14.51 $14.02
$13.28 $15.97 $14.83
- -----------------------------------------------------------------
- --------------------------------
TOTAL RETURN 10.95%++ 14.88% 8.78% 12.62%
(9.52)% 14.69% 8.98%++
- -----------------------------------------------------------------
- --------------------------------
NET ASSETS, END OF YEAR
(MILLIONS) $ 841 $ 951 $1,310 $1,573
$1,823 $2,766 $1,721
- -----------------------------------------------------------------
- --------------------------------
RATIOS TO AVERAGE NET
ASSETS:
Expenses 1.51%+ 1.52% 1.55% 1.56%
1.54% 1.56% 1.57%+
Net investment income 4.10+ 4.85 5.13 5.82
5.07 5.17 5.78+
- -----------------------------------------------------------------
- --------------------------------
PORTFOLIO TURNOVER RATE 24% 45% 58% 36%
28% 37% 10%
- -----------------------------------------------------------------
- --------------------------------
AVERAGE COMMISSIONS PER
SHARE PAID ON EQUITY
TRANSACTIONS (3) $ 0.06 $ 0.06 $ 0.06 --
- -- -- --
- -----------------------------------------------------------------
- --------------------------------
</TABLE>
(1) For the six months ended January 31, 1998 (unaudited).
(2) For the period from March 1, 1992 to July 31, 1992.
(3) As of September 1995, the SEC instituted new guidelines
requiring the
disclosure of average commissions per share.
++Total return is not annualized as it may not be representative
of the total
return for the year.
+ Annualized.
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A CLASS B SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT
EACH YEAR:
<TABLE>
<CAPTION>
SMITH BARNEY BALANCED FUND
YEAR ENDED 2/28/92 2/28/91
2/28/90 2/28/89(1)
- -----------------------------------------------------------------
- --------------
<S> <C> <C> <C>
<C>
NET ASSET VALUE, BEGINNING OF YEAR $13.21 $12.93 $12.09
$12.00
- -----------------------------------------------------------------
- --------------
INCOME (LOSS) FROM OPERATIONS:
Net investment income 0.82 0.88 0.87
0.64
Net realized and unrealized gain (loss)
on investments 0.94 0.40 1.08
0.17
- -----------------------------------------------------------------
- --------------
Total Income (Loss) From Operations 1.76 1.28 1.95
0.81
- -----------------------------------------------------------------
- --------------
LESS DISTRIBUTIONS FROM:
Net investment income (0.84) (0.90)
(0.90) (0.57)
Net realized gains (0.15) (0.10)
(0.21) (0.15)
Capital (0.03) -- --
- --
- -----------------------------------------------------------------
- --------------
Total Distributions (1.02) (1.00)
(1.11) (0.72)
- -----------------------------------------------------------------
- --------------
NET ASSET VALUE, END OF YEAR $13.95 $13.21 $12.93
$12.09
- -----------------------------------------------------------------
- --------------
TOTAL RETURN 13.63% 10.46%
16.34% 6.80%++
- -----------------------------------------------------------------
- --------------
NET ASSETS, END OF YEAR (MILLIONS) $1,275 $ 707 $ 604
$ 416
- -----------------------------------------------------------------
- --------------
RATIOS TO AVERAGE NET ASSETS:
Expenses 1.58% 1.65%
1.70% 1.77%+
Net investment income 6.04 6.89 6.83
6.99+
- -----------------------------------------------------------------
- --------------
PORTFOLIO TURNOVER RATE 33% 31%
50% 46%
- -----------------------------------------------------------------
- --------------
AVERAGE COMMISSIONS PER SHARE PAID ON
EQUITY TRANSACTIONS (2) -- -- --
- --
- -----------------------------------------------------------------
- --------------
</TABLE>
(1) For the period from March 28, 1988 (inception date) to
February 28, 1989.
(2) As of September 1995, the SEC instituted new guidelines
requiring the
disclosure of average commissions per share.
++Total return is not annualized as it may not be representative
of the total
return for the year.
+ Annualized.
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A CLASS C SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT
EACH YEAR:
<TABLE>
<CAPTION>
SMITH BARNEY BALANCED FUND
YEAR ENDED 1998(1)(2) 1997(2) 1996 1995(3)
1994 1993(4)
- -----------------------------------------------------------------
- --------------------
<S> <C> <C> <C> <C>
<C> <C>
NET ASSET VALUE,
BEGINNING OF YEAR $15.53 $14.51 $ 14.02 $13.28
$15.97 $15.17
- -----------------------------------------------------------------
- --------------------
INCOME (LOSS) FROM
OPERATIONS:
Net investment income 0.33 0.73 0.77 0.78
0.73 0.35
Net realized and
unrealized gain (loss)
on investments 1.34 1.36 0.47 0.82
(2.17) 0.86
- -----------------------------------------------------------------
- --------------------
Total Income (Loss) From
Operations 1.67 2.09 1.24 1.60
(1.44) 1.21
- -----------------------------------------------------------------
- --------------------
LESS DISTRIBUTIONS FROM:
Net investment income (0.38) (0.75) (0.75) (0.76)
(0.75) (0.39)
Net realized gains (0.60) (0.32) -- (0.08)
(0.50) (0.02)
Capital -- -- -- (0.02)
- -- --
- -----------------------------------------------------------------
- --------------------
Total Distributions (0.98) (1.07) (0.75) (0.86)
(1.25) (0.41)
- -----------------------------------------------------------------
- --------------------
NET ASSET VALUE, END OF
YEAR $16.22 $15.53 $ 14.51 $14.02
$13.28 $15.97
- -----------------------------------------------------------------
- --------------------
TOTAL RETURN 10.97%++ 15.01% 8.80% 12.62%
(9.52)% 8.08%++
- -----------------------------------------------------------------
- --------------------
NET ASSETS, END OF YEAR
(000'S) $9,272 $9,381 $11,441 $3,925
$1,894 $ 252
- -----------------------------------------------------------------
- --------------------
RATIOS TO AVERAGE NET
ASSETS:
Expenses 1.47%+ 1.47% 1.50% 1.51%
1.48% 1.49%+
Net investment income 4.13+ 4.89 5.19 5.77
5.13 5.25+
- -----------------------------------------------------------------
- --------------------
PORTFOLIO TURNOVER RATE 24% 45% 58% 36%
28% 37%
- -----------------------------------------------------------------
- --------------------
AVERAGE COMMISSIONS PER
SHARE PAID ON EQUITY
TRANSACTIONS(5) $ 0.06 $ 0.06 $0.06 --
- -- --
- -----------------------------------------------------------------
- --------------------
</TABLE>
(1) For the six months ended January 31, 1998 (unaudited).
(2) Per share amounts have been calculated using the monthly
average shares
method rather than the undistributed net investment income
method, because
it more accurately reflects the per share data for the
period.
(3) On November 7, 1994, the former Class D shares were renamed
Class C
shares.
(4) For the period from February 4, 1993 (inception date) to July
31, 1993.
(5) As of September 1995, the SEC instituted new guidelines
requiring the
disclosure of average commissions per share.
++Total return is not annualized as it may not be representative
of the total
return for the year.
+ Annualized.
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A CLASS Y SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT
EACH YEAR:
<TABLE>
<CAPTION>
SMITH BARNEY BALANCED FUND
YEAR ENDED 1998(1)(2) 1997
1996(3)
- -----------------------------------------------------------------
- -----------
<S> <C> <C>
<C>
NET ASSET VALUE, BEGINNING OF YEAR $15.56 $ 14.52
$14.88
- -----------------------------------------------------------------
- -----------
INCOME FROM OPERATIONS:
Net investment income 0.38 0.83
0.64
Net realized and unrealized gain (loss) on
investment 1.31 1.38
(0.29)
- -----------------------------------------------------------------
- -----------
Total Income From Operations 1.69 2.21
0.35
- -----------------------------------------------------------------
- -----------
LESS DISTRIBUTIONS FROM:
Net investment income (0.43)
(0.85) (0.71)
Net realized gains (0.60)
(0.32) --
- -----------------------------------------------------------------
- -----------
Total Distributions (1.03)
(1.17) (0.71)
- -----------------------------------------------------------------
- -----------
NET ASSET VALUE, END OF YEAR $16.22 $ 15.56
$14.52
- -----------------------------------------------------------------
- -----------
TOTAL RETURN 11.08%++
15.88% 2.28%++
- -----------------------------------------------------------------
- -----------
NET ASSETS, END OF YEAR (000S) $ 1 $24,676
$7,617
- -----------------------------------------------------------------
- -----------
RATIOS TO AVERAGE NET ASSETS:
Expenses 0.68%+
0.67% 0.78%+
Net investment income 5.00+ 5.58
5.54+
- -----------------------------------------------------------------
- -----------
PORTFOLIO TURNOVER RATE 24%
45% 58%
- -----------------------------------------------------------------
- -----------
AVERAGE COMMISSIONS PER SHARE PAID ON EQUITY
TRANSACTIONS $ 0.06 $0.06
$0.06
- -----------------------------------------------------------------
- -----------
</TABLE>
(1) For the six months ended January 31, 1998 (unaudited).
(2) Per share amounts have been calculated using the monthly
average share
method, rather than the undistributed net investment income
method,
because it more accurately reflects the per share data for
the period.
(3) For the period from October 9, 1995 (inception date) through
July 31,
1996.
++Total return is not annualized, as it may not be
representative of the
total return for the year.
+ Annualized.
SMITH BARNEY CONVERTIBLE FUND (the "Fund")
Supplement dated June 15, 1998 to the Prospectus
Dated November 28, 1997
The following information supplements, and to the extent
inconsistent therewith, supercedes the information in the
Prospectus under "Prospectus Summary-Alternative Purchase
Arrangements."
CLASS L SHARES. Class L shares are sold
at net asset value plus an initial sales
charge of 1%. They are subject to an
annual service fee of 0.25% and an annual
distribution fee of 0.75% of the average
daily net assets of the Class. Investors
pay a CDSC of 1% if they redeem Class L
shares within 12 months of purchase.
The following information supplements, and to the extent
inconsistent therewith, supercedes the information in the
Prospectus under "Prospectus Summary-The Fund's Expenses."
THE FUND'S EXPENSES The following expense table lists the costs and
expenses an investor will incur either directly or indirectly as
a shareholder of the Fund, based on the maximum sales charge or
maximum CDSC that may be incurred at the time of purchase or
redemption and the Fund's operating expenses for its most recent
fiscal year:
Smith Barney
Convertible Fund Class Class Class Class Class
A B L***
O**** Y
Shareholder
Transaction
Expenses
Maximum sales
charge imposed
on purchases
(as a percentage
of offering price) 5.00% None 1.00% 1.00% None
Maximum CDSC
(as a percentage
of original cost
or redemption
proceeds,
whichever is
lower) None* 5.00% 1.00% 1.00%
None
Annual Fund
Operating Expense
(as a percentage of
average net assets)
Management fees 0.70% 0.70% 0.70% 0.70% 0.70%
12b-1 fees** 0.25 0.75 1.00 0.70
None
Other expenses 0.32 0.32 0.11 0.34
0.15
TOTAL FUND
OPERATING
EXPENSES 1.27% 1.77% 1.81% 1.74% 0.85%
? Purchase of Class A shares of $500,000 or more will be made at
net asset value with no sales charge, but will be subject to a
CDSC of 1.00% on redemptions made within 12 months of
purchase.
** Upon conversion of Class B shares to Class A shares, such
shares will no longer be subject to a distribution fee. Class
L and Class O shares do not have a conversion feature and,
therefore, are subject to an ongoing distribution fee. As a
result, long-term shareholders of Class L and Class O shares
may pay more than the economic equivalent of the maximum
front-end sales charge permitted by the National Association
of Securities Dealers, Inc.
*** Class L shares "Other Expenses" have been estimated because
no Class L shares were outstanding during the fiscal year
ended December 31, 1997
****Class O shares were formerly designated Class C Shares.
Class O shares are available to purchase only by former Class
C shareholders. Purchasers of Class O shares will be subject
to a 1% sales charge after June 25, 1999.
EXAMPLE
The following example is intended to assist an investor in
understanding the various costs that an investor in the Fund will
bear directly or indirectly. The example assumes payment by the
Fund of operating expenses at the levels set forth in the table
above. See "Purchase of Shares," "Redemption of Shares" and
"Management of the Fund."
Smith Barney
Convertible Fund
1 year
3 years
5 years
10 years*
An investor would pay the following expenses on a $1,000
investment, assuming (1) 5.00% annual return and (2) redemption
at the end of each time period:
1 3 5
10
Year years years years*
Class A $62 $88 $116 $196
Class B 68 86 106 295
Class L 29 58 101 218
Class O 28 55 94 205
Class Y 9 27 47 105
An investor would pay the following expenses on the same
investment, assuming the same annual return and no redemption:
1 3 5 10
Year years years years*
Class A $62 $88 $116 $196
Class B 18 86 96 295
Class L 19 58 101 218
Class O 18 55 94 205
Class Y 9 27 47 105
? Ten-year figures assume conversion of Class B shares to Class
A shares at the end of the eighth year following the date of
purchase.
The example also provides a means for the investor to
compare expense levels of funds with different fee structures
over varying investment periods. To facilitate such comparison,
all funds are required to utilize a 5.00% annual return
assumption. However, the Fund's actual return will vary and may
be greater or less than 5.00%. This example should not be
considered a representation of past or future expenses and actual
expenses may be greater or less than those shown.
The following information supplements, and to the extent
inconsistent therewith, supercedes the information in the
Prospectus under "Exchange Privilege."
Class L and Class O shares may be
exchanged with Class L shares of other
Smith Barney Mutual Funds.
The following information supplements, and to the extent
inconsistent therewith, supercedes the information in the
Prospectus under "Additional Information."
Class L shares are subject to the same
terms and conditions as other classes of
the Fund as outlined in the Prospectus.
- -----------------------------------------------------------------
- ---------------
Financial Highlights
The following information for each of the years in the three-year
period ended
July 31, 1997, has been audited by KPMG Peat Marwick LLP,
independent auditors,
whose report thereon appears in the Fund's Annual Report dated
July 31, 1997.
The following information for the fiscal years ended July 31,
1988 through July
31, 1993 has been audited by other independent auditors. The
information set out
below should be read in conjunction with the financial statements
and related
notes that also appear in the Fund's 1997 Annual Report, which is
incorporated
by reference into the Statement of Additional Information.
For a Class A share of beneficial interest outstanding throughout
each year:
<TABLE>
<CAPTION>
Smith Barney Convertible Fund
Year Ended July 31, 1998(1)(2) 1997 1996(2) 1995
1994 1993(3)
=================================================================
====================
<S> <C> <C> <C> <C>
<C> <C>
Net Asset Value, Beginning of Period $18.61 $15.66 $15.27
$14.56 $14.99 $13.82
- -----------------------------------------------------------------
- --------------------
Income From (Loss)Operations:
Net investment income 0.38 0.78 0.74
0.74 0.72 0.49
Net realized and unrealized
gain (loss) (0.40) 3.28 0.38 0.70 (0.42)
1.22
- -----------------------------------------------------------------
- --------------------
Total Income(Loss) From Operations (0.02) 4.06 1.12
1.44 0.30 1.71
- -----------------------------------------------------------------
- --------------------
Less Distributions From:
Net investment income (0.38) (0.75) (0.73) (0.73)
(0.73) (0.51)
Net realized gains (1.28) (0.36) -- --
- -- (0.03)
- -----------------------------------------------------------------
- --------------------
Total Distributions (1.66) (1.11) (0.73) (0.73)
(0.73) (0.54)
- -----------------------------------------------------------------
- --------------------
Net Asset Value, End of Period $16.93 $18.61 $15.66
$15.27 $14.56 $14.99
- -----------------------------------------------------------------
- --------------------
Total Return (0.08)++ 26.94% 7.41% 10.35%
1.99% 12.63%++
- -----------------------------------------------------------------
- --------------------
Net Assets, End of Year (millions) $37 $39 $35 $35
$ 2 $ 2
- -----------------------------------------------------------------
- --------------------
Ratios to Average Net Assets:
Expenses 1.23+ 1.27% 1.40% 1.40%
1.40% 1.37%+
Net investment income 4.13+ 4.61 4.68 5.13
4.80 4.86+
- -----------------------------------------------------------------
- --------------------
Portfolio Turnover Rate 28% 57% 59%
48% 54% 95%
- -----------------------------------------------------------------
- --------------------
Average Commissions per Share
Paid on Equity Transactions(4) $0.06 $0.06 --
- -- --
=================================================================
====================
</TABLE>
(1) For the six months ended January 31, 1998(unaudited)
(2) Per share amounts have been calculated using the monthly
average shares
method, rather than the undistributed net investment income
method, because
it more accurately reflects the per share data for the
period.
(3) For the period from November 6, 1992 (inception date) to
July 31, 1993.
(4) As of September 1995, the SEC instituted new guidelines
requiring the
disclosure of average commissions per share.
++ Total return is not annualized as it may not be
representative of the total
return for the year.
+ Annualized.
- -----------------------------------------------------------------
- ---------------
Financial Highlights (continued)
- -----------------------------------------------------------------
- ---------------
For a Class B share of beneficial interest outstanding throughout
each year:
<TABLE>
<CAPTION>
Smith Barney Convertible Fund
Year Ended July 31, 1998(1)(2) 1997 1996(2) 1995
1994 1993 1992
=================================================================
========================================
<S> <C> <C> <C>
<C> <C> <C> <C>
Net Asset Value, Beginning of Year $18.60 $15.66 $15.27
$14.56 $14.99 $13.84 $12.51
- -----------------------------------------------------------------
- ----------------------------------------
Income (Loss)From Operations:
Net investment income 0.33 0.69 0.66
0.67 0.65 0.61 0.64
Net realized and unrealized
gain (loss) (0.40) 3.28 0.39 0.70
(0.42) 1.20 1.35
- -----------------------------------------------------------------
- ----------------------------------------
Total Income From (Loss)Operations (0.07) 3.97 1.05
1.37 0.23 1.81 1.99
- -----------------------------------------------------------------
- ----------------------------------------
Less Distributions From:
Net investment income (0.34) (0.67) (0.66)
(0.66) (0.66) (0.62) (0.64)
Net realized gains (1.28) (0.36) -- --
- -- (0.04) --
Capital -- -- --
- -- -- (0.02)
- -----------------------------------------------------------------
- ----------------------------------------
Total Distributions (1.62) (1.03) (0.66) (0.66)
(0.66) (0.66) (0.66)
- -----------------------------------------------------------------
- ----------------------------------------
Net Asset Value, End of Year $16.91 $18.60 $15.66 $15.27
$14.56 $14.99 $13.84
- -----------------------------------------------------------------
- ----------------------------------------
Total Return (0.36)++ 26.29% 6.91%
9.80% 1.50% 13.40% 16.25%
- -----------------------------------------------------------------
- ----------------------------------------
Net Assets, End of Year (millions) $38 $43 $42 $46
$85 $75 $57
- -----------------------------------------------------------------
- ----------------------------------------
Ratios to Average Net Assets:
Expenses 1.73+ 1.77% 1.90%
1.90% 1.88% 2.00% 1.88%
Net investment income 3.64+ 4.12 4.18
4.63 4.32 4.20 4.76
- -----------------------------------------------------------------
- ----------------------------------------
Portfolio Turnover Rate 28% 57% 59%
48% 54% 95% 77%
- -----------------------------------------------------------------
- ----------------------------------------
Average Commissions Per Share
Paid on Equity Transactions(3) $0.06 $0.06 $0.06 --
- -- -- --
=================================================================
========================================
</TABLE>
(1) For the six months ended January 31, 1998(unaudited)
(2) Per share amounts have been calculated using the monthly
average shares
method, rather than the undistributed net investment income
method, because
it more accurately reflects the per share data for the
period.
(3) As of September 1995, the SEC instituted new guidelines
requiring the
disclosure of average commissions per share.
++ Total return is not annualized as it may not be
representative of the total return for the year.
+ Annualized
- -----------------------------------------------------------------
- ---------------
Financial Highlights (continued)
- -----------------------------------------------------------------
- ---------------
1994 1993 1992 1991 1990
1989 1988
=================================================================
===============
$14.99 $13.84 $12.51 $12.21 $13.80
$13.04 $13.93
- -----------------------------------------------------------------
- ---------------
0.65 0.61 0.64 0.68 0.79
0.85 0.87
(0.42) 1.20 1.35 0.33 (1.40)
0.78 (0.64)
- -----------------------------------------------------------------
- ---------------
0.23 1.81 1.99 1.01 (0.61)
1.63 0.23
- -----------------------------------------------------------------
- ---------------
(0.66) (0.62) (0.64) (0.68) (0.83)
(0.86) (0.85)
-- (0.04) -- -- (0.11)
(0.01) (0.27)
-- -- (0.02) (0.03) (0.4) -
- - --
- -----------------------------------------------------------------
- ---------------
(0.66) (0.66) (0.66) (0.71) (0.98)
(0.87) (1.12)
- -----------------------------------------------------------------
- ---------------
$14.56 $14.99 $13.84 $12.51 $12.21
$13.80 $13.04
- -----------------------------------------------------------------
- ---------------
1.50% 13.40% 16.25% 8.86% (4.53)
13.09% 2.22%
- -----------------------------------------------------------------
- ---------------
$85 $75 $57 $66 $97
$153 $173
- -----------------------------------------------------------------
- ---------------
1.88% 2.00% 1.88% 1.92% 1.85%
1.74% 1.75%
4.32 4.20 4.76 5.81 6.10
6.41 6.74
- -----------------------------------------------------------------
- ---------------
54% 95% 77% 26% 24%
32% 45%
- -----------------------------------------------------------------
- ---------------
-- -- -- -- -- -
- - --
=================================================================
===============
- -----------------------------------------------------------------
- ---------------
Financial Highlights (continued)
- -----------------------------------------------------------------
- ---------------
For a Class C share of beneficial interest outstanding throughout
each year:
Smith Barney Convertible Fund
Year Ended July 31, 1998(1)(2) 1997
1996(2) 1995(3)(4)
=================================================================
===============
Net Asset Value, Beginning of Year $18.58 $15.64
$15.27 $14.09
- -----------------------------------------------------------------
- ---------------
Income From (Loss)Operations:
Net investment income 0.33 0.67 0.67
0.50
Net realized and unrealized
gain (0.39) 3.31 0.37 1.17
- -----------------------------------------------------------------
- ---------------
Total Income From (Loss)Operations (0.06) 3.98
1.04 1.67
- -----------------------------------------------------------------
- ---------------
Less Distributions From:
Net investment income (0.35) (0.68)
(0.67) (0.49)
Net realized gains (1.28) (0.36) -
- - --
- -----------------------------------------------------------------
- ---------------
Total Distributions (1.63) (1.04)
(0.67) (0.49)
- -----------------------------------------------------------------
- ---------------
Net Asset Value, End of Year $16.89 $18.58
$15.64 $15.27
- -----------------------------------------------------------------
- ---------------
Total Return (0.35)++ 26.37%
6.82% 12.17%++
- -----------------------------------------------------------------
- ---------------
Net Assets, End of Year (000s) $1,640 $1,252
$641 $83
- -----------------------------------------------------------------
- ---------------
Ratios to Average Net Assets:
Expenses 1.69+ 1.74%
1.86% 1.87%+
Net investment income 3.66+ 4.14
4.17 4.77+
- -----------------------------------------------------------------
- ---------------
Portfolio Turnover Rate 28% 57%
59% 48%
- -----------------------------------------------------------------
- ---------------
Average Commissions per Share
Paid on Equity Transactions (4) $0.06 $0.06
$0.06 --
(1) For the six months ended January 31, 1998(unaudited)
(2) Per share amounts have been calculated using the monthly
average shares
method, rather than the undistributed net investment income
method, because
it more accurately reflects the per share data for the
period.
(3) On November 7, 1994, the former Class D shares were renamed
Class C shares.
(4) For the period from November 7, 1994 (inception date) to
July 31, 1995.
(5) As of September 1995, the SEC instituted new guidelines
requiring the
disclosure of average commissions per share.
++ Total return is not annualized as it may not be
representative of the total
return for the year.
+ Annualized.
- -----------------------------------------------------------------
- ---------------
Financial Highlights (continued)
- -----------------------------------------------------------------
- ---------------
For a Class Y share of beneficial interest outstanding throughout
each year:
Smith Barney Convertible Fund
Year Ended July 31, 1998(1)(2)
1997 1996(2)(3)
=================================================================
===============
Net Asset Value, Beginning of Year $18.66
$15.68 $16.15
- -----------------------------------------------------------------
- ---------------
Income (Loss) From Operations:
Net investment income 0.41
0.83 0.38
Net realized and unrealized gain (loss) (0.39) 3.31
(0.46)
- -----------------------------------------------------------------
- ---------------
Total Income (Loss) From Operations 0.02
4.14 (0.08)
- -----------------------------------------------------------------
- ---------------
Less Distributions From:
Net investment income (0.41)
(0.80) (0.39)
Net realized gains (1.28)
(0.36) --
- -----------------------------------------------------------------
- ---------------
Total Distributions (1.69)
(1.16) (0.39)
- -----------------------------------------------------------------
- ---------------
Net Asset Value, End of Year $16.99
$18.66 $15.68
- -----------------------------------------------------------------
- ---------------
Total Return 0.11++
27.44% (0.56)%++
- -----------------------------------------------------------------
- ---------------
Net Assets, End of Year (000s) $58,087
$29,080 $9,189
- -----------------------------------------------------------------
- ---------------
Ratios to Average Net Assets:
Expenses 0.81+
0.85% 1.00%+
Net investment income 4.54+
5.04 4.98+
- -----------------------------------------------------------------
- ---------------
Portfolio Turnover Rate 28%
57% 59%
- -----------------------------------------------------------------
- ---------------
Average Commissions per Share
Paid on Equity Transactions (3) $0.06
$0.06 $0.06
=================================================================
===============
(1) For the six month period ended January 31, 1998(unaudited)
(2) Per share amounts have been calculated using the monthly
average shares
method, rather than the undistributed net investment income
method, because
it more accurately reflects the per share data for the
period.
(3) For the period from February 7, 1996 (inception date) to
July 31, 1996.
++ Total return is not annualized as it may not be
representative of the total
return for the year.
+ Annualized.
The Prospectuses of the Convertible Fund and Balanced Fund which are part of
the series of the Smith Barney Income Funds, filed on November 25, 1997 with
Post-Effective Amendment No. 47 to the Fund's Registration Statement
on form N-1A (Accession No. 0000091155-97-000516) is incorporated
by reference in its entirety.
SMITH BARNEY INCOME FUNDS
Part B
The Statement of Additional Information filed on November 25, 1997 with
Post-Effective Amendment No. 47 to the Fund's Registration
Statement on form N-1A (Accession No. 0000091155-97-000516)
is incorporated by reference in its entirety.
SMITH BARNEY INCOME FUNDS
PART C
Item 24. Financial Statements and Exhibits
(a) Financial Statements:
Included in Part A:
Financial Highlights
Included in Part B:
The Registrant's Annual Reports for the fiscal year ended July
31, 1997 and the Report of Independent Auditors dated September
15, 1997 are incorporated by reference to the Definitive 30b2-1
filed on September 30, 1997 as Accession #0000091155-97-000435.
The Registrant's Semi-Annual Reports for the period ended January
31, 1998 are incorporated by reference to the Definitive 30b2-1
filed on April 14, 1998 as Accession #0000091155-98-000263
The Registrant's Annual Report (Smith Barney Premium Total
Return Fund) for the fiscal year ended December 31, 1997 and the
Report of Independent Auditors dated February 10, 1998 are
incorporated by reference to the Definitive 30b2-1 filed on
March 26, 1998 as Accession #0000091155-98-000200.
Included in Part C:
(b) Exhibits:
All references are to the Registrant's registration statement on
Form N-1A (the "Registration Statement") as filed with the
Securities and Exchange Commission (the "SEC") on March 13, 1985
(File Nos. 2-96408 and 811-4254).
(1) Registrant's First Amended and Restated Master Trust
Agreement dated November 5, 1993 and Amendment No. 1 to
the Master Trust Agreement dated July 30, 1993 are
incorporated by reference to Post-Effective Amendment No.
36.
(2) Registrant's By-Laws are incorporated by reference to the
Registration Statement.
(3) Not Applicable.
(4) Registrant's form of stock certificate for Smith Barney
Total Return Bond Fund Class A, Class B, Class C and Class
Y shares of beneficial interest is filed herewith.
(5)(a) Transfer of Investment Advisory Agreements between the
Registrant and Smith Barney Mutual Funds Management with
respect to Smith Barney Diversified Strategic Income Fund,
Smith Barney Utilities Fund, Smith Barney Convertible
Securities Fund, Smith Barney High Income Fund, Smith
Barney Tax-Exempt Income Fund and Smith Barney Exchange
Reserve Fund are incorporated by reference to Post-
Effective Amendment No. 40.
(b) Investment Advisory Agreement between Registrant and Smith
Barney Strategy Advisers Inc. with respect to Smith Barney
Premium Total Return Fund is incorporated by reference to
Post-Effective Amendment No. 41 to the Registration
Statement.
(c) Form of Investment Management Agreement between Registrant
and Mutual Management Corp. with respect to Smith Barney
Total Return Bond Fund is filed herewith.
(d) Sub-Investment Advisory Agreement among the Registrant,
Smith Barney Strategy Advisers, Inc. and Boston Partners
Asset Management, L.P. with respect to Smith Barney Premium
Total Return Fund is incorporated by reference to Post-
Effective Amendment No. 41 to the Registration Statement.
(e) Sub-Investment Advisory Agreement between the Registrant
and Smith Barney Global Capital Management Inc. with
respect to Smith Barney Diversified Strategic Income Fund
is incorporated by reference to Post-Effective Amendment
No. 40.
(6)(a) Distribution Agreement between the Registrant and Smith
Barney Inc. is incorporated by reference to the Post-
Effective Amendment No. 40.
(b) Distribution Agreement between the Registrant and PFS
Distributors, Inc. is incorporated by reference to Post-
Effective Amendment No. 43 to the Registration Statement.
(7) Not Applicable.
(8)(a) Custodian Agreement between the Registrant and PNC Bank,
National Association ("PNC Bank") is incorporated by
reference to Post-Effective Amendment No. 41 to the
Registration Statement.
(b) A form of Custodian Agreement between the Registrant and
Chase Manhattan Bank is incorporated by reference to Post-
Effective Amendment No. 43 to the Registration Statement.
(9)(a) Administration Agreement between the Registrant and MMC is
incorporated by reference to Post-Effective Amendment No.
40.
(b) Transfer Agency and Registrar Agreement between the
Registrant and First Data Investor Services Group, Inc.,
(formerly The Shareholder Services Group, Inc.) is
incorporated by reference to Post-Effective Amendment No.
40 to the Registration Statement.
(10) Opinion of Counsel was filed with Registrant's 24f-2
Notice on February 25, 1997 as accession number
0000091155-97-000095.
(11) Not applicable.
(12) Not applicable.
(13) Not applicable.
(14) Not applicable.
(15)(a) Services and Distribution Plans pursuant to Rule
12b-1 between the Registrant on behalf of Smith Barney
Diversified Strategic Income Fund, Smith Barney Utilities
Fund, Smith Barney Convertible Securities Fund, Smith
Barney High Income Fund, Smith Barney Premium Total Return
Fund, Smith Barney Tax-Exempt Income Fund and Smith Barney
Exchange Reserve Fund are incorporated by reference to
Post-Effective Amendment No. 40.
(16) Performance Data for Registrant is incorporated by
reference to Post-Effective Amendments No. 14, 15 and 30
to the Registration Statement filed on September 30, 1988,
December 30, 1988 and January 29, 1992, respectively.
(17) Not applicable.
(18) Plan pursuant to Rule 18f-3 is incorporated by reference
to Post-Effective Amendment No. 41 to the Registration
Statement.
Item 25. Persons Controlled by or Under Common Control with
Registrant
None.
Item 26. Number of Holders of Securities
(1) Title of Class (2) Number of Record Holders
by Class as of June 8, 1998
Beneficial Interest par value
$.001 per share
Fund Class A Class B Class C Class Y Class Z
Balanced
Fund 21,135 54,090 588 3 10
Convertible
Fund 3,179 2,997 107 8 N/A
Diversified
Strategic
Income Fund 17,469 98,928 5,043 9 7
Exchange
Reserve
Fund N/A 4,835 861 N/A N/A
High Income
Fund 23,344 35,108 3,065 15 6
Municipal
High Income
Fund 7,311 12,431 46 3 N/A
Premium
Total
Return
Fund 47,404 160,350 8,622 10 N/A
Total Return
Bond Fund 1,673 4,250 847 0 N/A
Item 27. Indemnification
The response to this item is incorporated by reference to Registrant's
Post-Effective Amendment No. 2 to the Registration Statement.
Item 28. (a) Business and Other Connections of Investment Adviser
Investment Adviser - Mutual Management Corp. ("MMC")
MMC, formerly known as Smith Barney Mutual Funds Management
Inc., was incorporated in December 1968 under the laws of the
State of Delaware. MMC is a wholly owned subsidiary of Salomon
Smith Barney Holdings Inc. ("Holdings") (formerly known as Smith
Barney Holdings Inc.), which in turn is a wholly owned
subsidiary of Travelers Group Inc. ("Travelers"), formerly known
as Primerica Corporation. MMC is registered as an investment
adviser under the Investment Advisers Act of 1940 (the "Advisers
Act").
The list required by this Item 28 of officers and directors of
MMC together with information as to any other business,
profession, vocation or employment of a substantial nature
engaged in by such officers and directors during the past two
fiscal years, is incorporated by reference to Schedules A and D
of FORM ADV filed by MMC pursuant to the Advisers Act (SEC File
No. 801-14437).
Investment Adviser - Smith Barney Strategy Advisers Inc. ("Strategy
Advisers")
Strategy Advisers was incorporated on October 22, 1986 under the
laws of the State of Delaware. On June 1, 1994, Strategy
Advisers changed its name from Smith Barney-Shearson Strategy
Advisers Inc. to its current name. Strategy Advisers is a wholly
owned subsidiary of MMC. Strategy Advisers is registered as an
investment adviser under the Investment Advisers Act of 1940
(the "Advisers Act"). Strategy Advisers is also registered with
the Commodity Futures Trading Commission (the "CFTC") as a
commodity pool operator under the Commodity Exchange Act (the
"CEA"), and is a member of the National Futures Association (the
"NFA").
The list required by this Item 28 of officers and directors of
MMC and Strategy Advisers, together with information as to any
other business, profession, vocation or employment of a
substantial nature engaged in by such officers and directors
during the past two years, in incorporated b reference to
Schedules A and D of FORM ADV filed by MMC on behalf of Strategy
Advisers pursuant to the Advisers Act (SEC File No. 801-8314).
Sub-Investment Adviser - Boston Partners Asset Management, L.P.
("Boston Partners")
Boston Partners was organized in April, 1995 under the laws of
the State of Delaware as a Limited Partnership and provides a
comprehensive range of financial products and services in
domestic and selected international markets. Boston Partners is
an investment adviser registered under the Investment Advisers
Act of 1940 (the "Advisers Act") and provides investment advice
to endowment plans, Taft Hartley Health and Welfare Plans, VEBAS
and institutional clients. It also serves as investment adviser
and sub-investment adviser to other investment companies.
The list required by this Item 28 of officers and directors of
Boston Partners, together with information as to any other
business profession, vocation or employment of a substantial
nature engaged in by such officers and directors during the past
two years, is incorporated by reference to Schedules A and D of
FORM ADV filed by Boston Partners pursuant to the Advisers Act
(SEC File No. 801-49059).
Sub-Investment Adviser - Smith Barney Global Capital Management
Inc. ("SBGCM")
SBGCM was incorporated on January 22, 1988 under the laws of the
State of Delaware. SBGCM is an indirect wholly owned subsidiary
of Holdings. SBGCM is an investment adviser registered with the
Securities and Exchange Commission in the United States and with
the Investment Management Regulatory Organization Limited in
the United Kingdom. SBGCM conducts its operations primarily in
the United Kingdom.
The list required by this Item 28 of officers and directors of
SBGCM, together with information as to any other business,
profession, vocation or employment of a substantial nature
engaged in by such officers and directors during the past two
years, is incorporated by reference to Schedules A and D of FORM
ADV filed by SBGCM pursuant to the Advisers Act (SEC File No.
801-31824).
Item 29. Principal Underwriters
Smith Barney Inc. ("Smith Barney") currently acts as a
distributor for Concert Investment Series; Concert
Investment Series; Consulting Group Capital Markets
Funds; Global Horizons Investment Series (Cayman
Islands); Greenwich Street California Municipal Fund
Inc.; Greenwich Street Municipal Fund Inc.; Greenwich
Street Series Fund; High Income Opportunity Fund Inc.;
The Italy Fund Inc.; Managed High Income Portfolio Inc.;
Managed Municipals Portfolio II Inc.; Managed Municipals
Portfolio Inc.; Municipal High Income Fund Inc.; Puerto
Rico Daily Liquidity Fund Inc.; Smith Barney Adjustable
Rate Government Income Fund; Smith Barney Aggressive
Growth Fund Inc.; Smith Barney Appreciation Fund Inc.;
Smith Barney Arizona Municipals Fund Inc.; Smith Barney
California Municipals Fund Inc.; Smith Barney Concert
Allocation Series Inc.; Smith Barney Small Cap Blend
Fund, Inc.; Smith Barney Equity Funds; Smith Barney
Fundamental Value Fund Inc.; Smith Barney Funds, Inc.;
Smith Barney Income Funds; Smith Barney Institutional
Cash Management Fund, Inc.; Smith Barney Intermediate
Municipal Fund, Inc.; Smith Barney Investment Funds Inc.;
Smith Barney Investment Trust; Smith Barney Managed
Governments Fund Inc.; Smith Barney Managed Municipals
Fund Inc.; Smith Barney Massachusetts Municipals Fund;
Smith Barney Money Funds, Inc.; Smith Barney Muni Funds;
Smith Barney Municipal Fund, Inc.; Smith Barney Municipal
Money Market Fund, Inc.; Smith Barney Natural Resources
Fund Inc.; Smith Barney New Jersey Municipals Fund Inc.;
Smith Barney Oregon Municipals Fund Inc.; Smith Barney Principal
Return Fund; Smith Barney Small Cap Blend Fund, Inc.
Smith Barney Telecommunications Trust; Smith Barney
Variable Account Funds; Smith Barney World Funds,
Inc.; Smith Barney Worldwide Special Fund N.V.
(Netherlands Antilles); Travelers Series Fund Inc.; The
USA High Yield Fund N.V.; Worldwide Securities Limited
(Bermuda); Zenix Income Fund Inc. and various series of
unit investment trusts.
Smith Barney is a wholly owned subsidiary of Holdings. On June 1,
1994, Smith Barney changed its name from Smith Barney Shearson Inc. to
its current name. The information required by this Item 29 with
respect to each director, officer and partner of Smith Barney is
incorporated by reference to Schedule A of FORM BD filed by Smith
Barney pursuant to the Securities Exchange Act of 1934 (SEC File No.
812-8510).
Item 30. Location of Accounts and Records
(1) Smith Barney Inc.
388 Greenwich Street
New York, New York 10013
(2) Smith Barney Income Funds
388 Greenwich Street
New York, New York 10013
(3) Mutual Management Corp.
388 Greenwich Street
New York, New York 10013
(4) Boston Partners Asset Management, L.P.
One Financial Center
43rd floor
Boston, Massachusetts 02111
(5) Smith Barney Global Capital Management Inc.
10 Piccadilly
London W1V 9LA
England
(6) PNC Bank, National Association
17th and Chestnut Streets
Philadelphia, PA 19103
(7) First Data Investor Services Group, Inc.
One Exchange Place
Boston, Massachusetts 02109
Item 31. Management Services
Not Applicable.
Item 32. Undertakings
(a) The Registrant hereby undertakes to call a meeting of its
shareholders for the purpose of voting upon the question of
removal of a trustee or trustees of Registrant when requested in
to do so by the holders of at least 10% of Registrant's
outstanding shares. Registrant undertakes further, in connection
with the meeting, to comply with the provisions of Section 16(c)
of the 1940 Act relating to communications with the shareholders
of certain common-law trusts.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
and the Investment Company Act of 1940, as amended, the Registrant, SMITH BARNEY
INCOME FUNDS, has duly caused this Amendment to the Registration Statement
to be
signed on its behalf by the undersigned, thereunto duly authorized, all in the
City of New York, State of New York on the 10th day of June, 1998.
SMITH BARNEY INCOME FUNDS
By:/s/Heath B. McLendon
Heath B. McLendon, Chairman of
the Board
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Post-Effective Amendment to the Registration Statement has been signed
below by the following persons in the capacities and on the dates indicated.
Signature Title Date
/s/Heath B. McLendon Chairman of the Board 6/10/98
Heath B. McLendon (Chief Executive Officer)
/s/Lewis E. Daidone Senior Vice President and 6/10/98
Lewis E. Daidone Treasurer (Chief Financial
and Accounting Officer)
/s/Lee Abraham* Trustee 6/10/98
Lee Abraham
/s/ Allan J. Bloostein* Trustee 6/10/98
Allan J. Bloostein
/s/ Richard E. Hanson* Trustee 6/10/98
Richard E. Hanson
* Signed by Heath B. McLendon, their duly authorized attorney-in-fact,
pursuant to power of attorney dated September 4, 1996.
/s/Heath B. McLendon
Heath B. McLendon
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
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<CIK> 0000764624
<NAME> SMITH BARNEY INCOME FUNDS
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<NAME> CONVERTIBLE FUND, CLASS A
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
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<CIK> 0000764624
<NAME> SMITH BARNEY INCOME FUNDS
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<NAME> CONVERTIBLE FUND, CLASS B
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
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<CIK> 0000764624
<NAME> SMITH BARNEY INCOME FUNDS
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<NAME> CONVERTIBLE FUND, CLASS C
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<NAME> SMITH BARNEY INCOME FUNDS
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<NAME> CONVERTIBLE FUND, CLASS Y
<S> <C>
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000764624
<NAME> SMITH BARNEY INCOME FUNDS
<SERIES>
<NUMBER> 9
<NAME> UTILITIES FUND, CLASS A
<S> <C>
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000764624
<NAME> SMITH BARNEY INCOME FUNDS
<SERIES>
<NUMBER> 9
<NAME> UTILITIES FUND, CLASS B
<S> <C>
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000764624
<NAME> SMITH BARNEY INCOME FUNDS
<SERIES>
<NUMBER> 9
<NAME> UTILITIES FUND, CLASS C
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WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 6
<CIK> 0000764624
<NAME> SMITH BARNEY INCOME FUNDS
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<CIK> 0000764624
<NAME> SMITH BARNEY INCOME FUNDS
<SERIES>
<NUMBER> 9
<NAME> UTILITIES FUND, CLASS Z
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