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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. __)
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ X/ Preliminary Proxy Statement
/ / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
Alliance Municipal Income Fund, Inc.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement,
if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X / No fee required
/ / Fee computed on table below per Exchange Act Rule 14a-
6(i)(1) and 0-11.
(1) Title of each class of securities to which
transaction applies:
- ----------------------------------------------------------------
(2) Aggregate number of securities to which transaction
applies:
- ----------------------------------------------------------------
(3) Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule 0-11
(Set forth the amount on which the filing fee is
calculated and state how it was determined):
- ----------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- ----------------------------------------------------------------
(5) Total fee paid:
- ----------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided
by Exchange Act Rule 0-11(a)(2) and identify the filing
for which the offsetting fee was paid previously.
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Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its
filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
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ALLIANCE CAPITAL LOGO ALLIANCE MUNICIPAL INCOME FUND, INC.
_______________________________________________________________
1345 Avenue of the Americas New York, New York 10105
October , 1999
_______________________________________________________________
To the Stockholders of the California and New York Portfolios of
Alliance Municipal Income Fund, Inc. (the "Fund"):
The accompanying Notice of Special Meeting of Stockholders
and Proxy Statement present to the stockholders of the California
and New York Portfolios of the Fund (the "Portfolios") a proposal
to be considered at a Special Meeting of the Stockholders to be
held on December 8, 1999, to approve a change in each Portfolio's
investment policies eliminating the requirement that each
Portfolio invest principally in securities paying interest
subject to the federal alternative minimum tax ("AMT"). Your
Board of Directors recommends that you vote to approve the
proposal.
As you know, the Portfolios were designed by Alliance Capital
Management L.P. to seek to provide the highest level of income
exempt from federal and state tax that is available without
assuming undue risk. Each Portfolio has a fundamental policy,
dating from the Fund's inception in 1987, requiring the Portfolio
to invest at least 65% of its total assets in securities paying
interest subject to the AMT ("AMT-Subject Bonds"). The proposed
change to the Portfolios' fundamental investment policies would
remove this requirement, thus enabling the Portfolios to make
increased investments in securities wholly exempt from federal,
state and local tax, including the AMT. The change is being
recommended by Alliance to benefit shareholders by providing the
Portfolios with increased latitude to invest in whatever
combination of AMT-Subject Bonds and other municipal securities
is deemed by Alliance most likely to achieve the Portfolio's
investment objective in a manner consistent with its stated
investment policies.
Stockholder approval and implementation of the proposal by
one Portfolio is independent of stockholder approval and
implementation of the proposal by the other Portfolio.
Your Board of Directors urges you to read the enclosed Proxy
Statement carefully. We welcome your attendance at the Special
Meeting of Stockholders. If you are unable to attend, please
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sign, date and return the enclosed proxy card promptly, in order
to spare the Fund additional solicitation expenses.
Sincerely,
John D. Carifa
Chairman of the
Board of Directors
and President
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AllianceCapital Logo
Alliance Municipal Income Fund, Inc.
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1345 Avenue of the Americas, New York, New York 10105
Toll Free (800) 221-5672
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NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
DECEMBER 8, 1999
To the Stockholders of the California and New York Portfolios of Alliance
Municipal Income Fund, Inc.:
Notice is hereby given that a Special Meeting of Stockholders (the
"Meeting") of the California and New York Portfolios (the "Portfolios") of
Alliance Municipal Income Fund, Inc. (the "Fund") will be held at the offices
of the Fund, 1345 Avenue of the Americas, 33rd Floor, New York, New York
10105, on December 8, 1999 at 11:00 a.m., for the following purpose, which is
more fully described in the accompanying Proxy Statement dated October [ ],
1999:
1. To approve a proposal to change a fundamental investment policy of
each Portfolio to remove the requirement that the Portfolio invest at least
65% of its total assets in securities paying interest subject to the federal
alternative minimum tax.
2. To transact such other business as may properly come before the
Meeting.
The Board of Directors has fixed the close of business on October 15, 1999
as the record date for the determination of stockholders entitled to notice
of, and to vote at, the Meeting or any adjournment thereof. The enclosed proxy
is being solicited on behalf of the Board of Directors.
By Order of the Board of Directors,
Edmund P. Bergan, Jr.
Secretary
New York, New York
October [ ], 1999
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YOUR VOTE IS IMPORTANT
Please indicate your voting instructions on the enclosed Proxy Card, sign
and date it, and return it in the envelope provided, which needs no postage if
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mailed in the United States. In order to save the Fund any additional expense
of further solicitation, please mail your proxy promptly.
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(R) This registered service mark used under license from the owner, Alliance
Capital Management L.P.
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PROXY STATEMENT
ALLIANCE MUNICIPAL INCOME FUND, INC.
1345 Avenue of the Americas
New York, New York 10105
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SPECIAL MEETING OF STOCKHOLDERS
December 8, 1999
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INTRODUCTION
This Proxy Statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of Alliance Municipal Income Fund,
Inc., a Maryland corporation (the "Fund"), to be voted at a Special Meeting of
Stockholders of the California and New York Portfolios (the "Portfolios") of
the Fund (the "Meeting"), to be held at the offices of the Fund, 1345 Avenue
of the Americas, 33rd Floor, New York, New York 10105, on December 8, 1999 at
11:00 a.m. Such solicitation will be by mail and the cost will be borne by the
Fund. The Notice of Meeting, this Proxy Statement and a Proxy Card are being
mailed to stockholders on October [ ], 1999.
The Board of Directors has fixed the close of business on October 15, 1999
as the record date for the determination of stockholders entitled to notice
of, and to vote at, the Meeting and at any adjournment thereof. The
outstanding voting shares of the California and New York Portfolios of the
Fund as of October 15, 1999 consisted of, respectively, [ ] shares and
[ ] shares of Class A common stock, [ ] shares and [ ] shares of
Class B common stock and [ ] shares and [ ] shares of Class C common
stock, each share being entitled to one vote. All properly executed proxies
received prior to the Meeting will be voted at the Meeting in accordance with
the instructions marked thereon or otherwise provided therein. Accordingly,
unless instructions to the contrary are marked, proxies will be voted for the
approval of the Proposal set forth in the Notice of the Meeting. Any
stockholder may revoke that stockholder's proxy at any time prior to exercise
thereof by giving written notice to the Secretary of the Fund at 1345 Avenue
of the Americas, New York, New York 10105, by signing another proxy of a later
date or by personally voting at the Meeting.
If a proxy properly executed is returned with instructions to abstain from
voting or to withhold authority to vote (an abstention) or represents a broker
"non-vote" (that is, a proxy from a broker or nominee indicating that such
person has not received instructions from the beneficial owner or other person
entitled to vote shares on a particular matter with respect to which the
broker or nominee does not have discretionary power to vote), the shares
represented by the proxy, with respect to matters to be determined by a
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plurality or majority of the votes cast on such matters, will be considered
present for purposes of determining the existence of a quorum for the
transaction of business but, not being cast, will have no effect on the
outcome of such matters. With respect to any proposal the adoption of which
would require the affirmative vote of a specified proportion of Fund shares,
an abstention or broker non-vote would be considered present for purposes of
determining the existence of a quorum but would have the effect of a vote
against the proposal. If any proposals other than the Proposal properly come
before the Meeting, the shares represented by proxies will be voted on all
such proposals in the discretion of the person or persons voting the proxies.
A quorum for the Meeting will consist of one-third of the issued and
outstanding shares entitled to vote. In the event that a quorum is not
represented at the Meeting or, even if a quorum is represented, in the event
that sufficient votes in favor of the Proposal are not received by the
Meeting, the persons named as proxies may, but are under no obligation to,
with no other notice than announcement at the Meeting, propose and vote for
one or more adjournments of the Meeting with respect to the Fund or with
respect to the Proposal and further solicitation of proxies with respect to
the Proposal may be made. Shares represented by proxies indicating a vote
against the Proposal will be voted against adjournment of the meeting.
Under the Investment Company Act of 1940 (the "Act"), as to each Portfolio
approval of the Proposal requires the affirmative vote of the lesser of (i)
67% or more of the voting securities of that Portfolio present or represented
at any meeting, if the holders of more than 50% of the outstanding voting
securities of that Portfolio are present or represented by proxy, and
(ii) more than 50% of the outstanding voting securities of that Portfolio.
The only voting securities of each Portfolio are its outstanding shares of
Class A, Class B and Class C common stock. Stockholder approval and
implementation of the Proposal with respect to one Portfolio is independent of
stockholder approval and implementation of the Proposal with respect to the
other Portfolio. If the Proposal is approved by the stockholders of a
Portfolio, that Portfolio's fundamental investment policy mandating that that
Portfolio invest at least 65% of its total assets in securities paying
interest subject to the federal alternative minimum tax will be removed.
As of October 15, 1999, the Directors and officers of the Fund as a group
owned less than 1% of the Fund's outstanding shares of any class of common
stock of the Fund.
PROPOSAL
TO CHANGE THE FUNDAMENTAL INVESTMENT POLICIES OF THE CALIFORNIA AND NEW
YORK PORTFOLIOS OF THE FUND TO REMOVE THE REQUIREMENT THAT EACH PORTFOLIO
INVEST AT LEAST 65% OF ITS TOTAL ASSETS IN SECURITIES PAYING INTEREST SUBJECT
TO THE FEDERAL ALTERNATIVE MINIMUM TAX.
2
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Introduction
The Board of Directors of the Fund has approved, and recommended to the
stockholders of the California and New York Portfolios for their approval, a
proposal to modify the fundamental investment policies of the Portfolios to
remove the requirement that each Portfolio invest at least 65% of its total
assets in securities paying interest subject to the federal alternative
minimum tax ("AMT-Subject Bonds"). If the stockholders of a Portfolio approve
the Proposal, that Portfolio would no longer be required to invest a minimum
portion of its assets in AMT-Subject Bonds. The proposal was initiated by
Alliance Capital Management L.P., the Fund's investment adviser (the
"Adviser"), and unanimously approved on October 13, 1999 during a Special
Meeting of the Board of Directors.
Reasons for the Proposed Change
At the Special Meeting, the Adviser noted to the Board of Directors that
each Portfolio has an investment policy, originating from the time of its
inception in 1987, effectively mandating that at least 65% of its total assets
be invested in AMT-Subject Bonds. In addition, the Adviser noted that the
Portfolios' original design was a response to the Tax Reform Act of 1986,
which created the federal alternative minimum tax ("AMT"). The act
distinguished between municipal securities issued to finance certain specified
types of private activities, the interest on which generally is subject to the
AMT, and other municipal securities, the interest on which generally is not
subject to the AMT. The Adviser noted that in 1987 it was widely anticipated
that because of the tax liability associated with ownership of AMT-Subject
Bonds by taxpayers subject to the AMT, these bonds would generally provide
meaningfully higher yields than other municipal securities of comparable
quality and maturity. The Portfolios' emphasis on AMT-Subject Bonds was
intended to garner those anticipated higher yields, an investment strategy
that was expected to appeal to investors not subject to AMT. As a
consequence, the Portfolios' investment policies were written to mandate a
minimum investment in AMT-Subject Bonds.
Initially, AMT-Subject Bonds in fact did tend to outyield comparable other
municipal securities. However, in the years following 1987 this yield
differential has largely eroded. In addition, in more recent years, the
supply of AMT-Subject Bonds has diminished relative to the supply of other
municipal securities (and, in the Adviser's view, is likely to continue to do
so).
The Adviser informed the Directors that, in its view, as a consequence of
the foregoing changes in the municipal bond markets, it was now appropriate to
remove the mandatory requirement that the Portfolios invest a minimum
proportion of their respective portfolio assets in AMT-Subject Bonds. Each
Portfolio would thus gain the latitude to invest in whatever combination of
AMT-Subject Bonds and other municipal securities is deemed by the Adviser most
likely to achieve the Portfolio's investment objective in a manner consistent
with its stated investment policies. Additionally, the Adviser noted that it
believes that the proposed revisions will enable the Portfolios to maintain
3
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their current investment style and portfolio characteristics over time,
notwithstanding the gradually diminishing relative significance of AMT-Subject
Bonds in the marketplace. The Adviser expects that this change will have no
meaningful effect on the Portfolios' earning power or distribution rates
inasmuch as the yield spread between AMT-Subject Bonds and other municipal
securities is now minimal, or, in may cases, non-existent.
For these reasons, at the Special Meeting of the Board of Directors the
Adviser stated its belief that it is now appropriate to remove the requirement
that each Portfolio invest a minimum amount of its assets in AMT-Subject
Bonds.
If the Proposal is approved by the stockholders of a Portfolio, changes in
the Portfolio's asset composition would begin to be implemented shortly
thereafter. It is expected that these changes will be effected in the
ordinary course and without any increased transaction costs to the Portfolio.
Stockholder approval and implementation of the Proposal with respect to one
Portfolio is independent of stockholder approval and implementation of the
Proposal with respect to the other Portfolio.
The Board of Directors of the Fund recommends that the stockholders of the
Portfolios vote FOR the Proposal to remove the requirement that each Portfolio
invest at least a specified portion of its assets in securities paying
interest subject to the alternative minimum tax.
4
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OTHER MATTERS
Management of the Fund does not know of any matters to be presented at the
Meeting other than those mentioned in this Proxy Statement. If any other
matters properly come before the Meeting, the shares represented by proxies
will be voted with respect thereto in accordance with the best judgment of the
person or persons voting the proxies.
SUBMISSION OF PROPOSALS FOR THE NEXT
MEETING OF STOCKHOLDERS
Under the current By-Laws of the Fund, annual meetings of stockholders are
required to be held only when necessary under the Act to elect Directors (for
example, when fewer than a majority of the Fund's Directors have been selected
by the stockholders). It is therefore likely that stockholder meetings will
not be held on an annual basis. A stockholder proposal intended to be
presented at any meeting hereafter called must be received by the Fund within
a reasonable time before the solicitation relating thereto is made (or such
earlier date as may be specified by an advance notice provision in the Fund's
By-Laws) in order to be included in the proxy statement and form of proxy card
related to such meeting. The submission by a stockholder of a proposal for
inclusion in the proxy statement does not guarantee that it will be included.
Stockholder proposals are subject to certain regulations under the federal
securities laws.
The persons named as proxies for the next annual meeting of stockholders
will have discretionary authority to vote on any matter presented by a
stockholder for action at that meeting unless the Fund receives notice of the
matter by a reasonable time before the solicitation relating to the meeting is
made (or such earlier date as may be specified by an advance notice provision
in the Fund's By-Laws), in which case these persons will not have
discretionary voting authority except as provided in the Securities and
Exchange Commission's rules governing stockholder proposals.
REPORTS TO STOCKHOLDERS
The Fund will furnish to each person to whom the proxy statement is
delivered a copy of the Fund's latest annual report to stockholders and any
succeeding semi-annual report to stockholders, upon request and without
charge. To request a copy, please call Alliance Fund Services, Inc. at [(800)
227-4618] or contact [ ] at Alliance Capital Management L.P.,
1345 Avenue of the Americas, New York, New York 10105.
5
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By Order of the Board of Directors,
EDMUND P. BERGAN, JR.
Secretary
October [ ], 1999
New York, New York
6
<PAGE>
TABLE OF CONTENTS
Page
----
Introduction...................................................
Proposal: To Change the Fundamental Investment
Policies of the California and New York Portfolios
of the Fund to Remove the Requirement that each
Portfolio Invest at Least 65% of its Total Assets
in Securities Paying Interest Subject to the Federal
Alternative Minimum Tax........................................
Other Matters..................................................
Submission of Proposals for the Next
Annual Meeting of Stockholders...............................
Reports to Stockholders........................................
Alliance Municipal Income Fund, Inc.
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AllianceCapital logo
Alliance Capital Management L.P.
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NOTICE OF SPECIAL
MEETING OF STOCKHOLDERS
AND PROXY STATEMENT
October [ ], 1999
7
<PAGE>
PROXY PROXY
ALLIANCE MUNICIPAL INCOME FUND, INC.
PROXY FOR THE SPECIAL MEETING OF STOCKHOLDERS, DECEMBER 8, 1999
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of Alliance Municipal Income Fund,
Inc., a Maryland corporation (the "Corporation"), hereby appoints
each of [ ] and [ ] as proxies, each
with full power of substitution, to attend the Special Meeting of
Stockholders of the California Portfolio or the New York
Portfolio (as set forth hereon) of the Corporation (the
"Portfolio") to be held at 11:00 a.m., Eastern Time, on December
8, 1999 at the offices of the Corporation, 1345 Avenue of the
Americas, in the Audio Visual Conference Room, 33rd Floor, New
York, New York 10105, and any postponement or adjournment
thereof, and thereat to cast on behalf of the undersigned all
votes that the undersigned is entitled to cast and otherwise to
represent the undersigned with all powers possessed by the
undersigned if personally present. The undersigned hereby
acknowledges receipt of the Notice of Special Meeting of
Stockholders and accompanying Proxy Statement.
THIS PROXY, IF PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED. IF NO DIRECTION IS MADE,
THIS PROXY WILL BE VOTED "FOR" THE PROPOSAL TO CHANGE A
FUNDAMENTAL INVESTMENT POLICY OF THE PORTFOLIO TO REMOVE THE
REQUIREMENT THAT THE PORTFOLIO INVEST AT LEAST 65% OF ITS TOTAL
ASSETS IN SECURITIES PAYING INTEREST SUBJECT TO THE FEDERAL
ALTERNATIVE MINIMUM TAX, AND "FOR" ANY ADJOURNMENT OF THE MEETING
WITH RESPECT TO THE PROPOSAL DESCRIBED IN THE ACCOMPANYING PROXY
STATEMENT IN THE EVENT THAT INSUFFICIENT VOTES IN FAVOR OF THE
PROPOSAL ARE NOT RECEIVED PRIOR TO THE MEETING.
Please refer to the Proxy Statement for a discussion of the
Proposal.
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PLEASE VOTE, DATE AND SIGN ON REVERSE AND PROMPTLY RETURN THIS
PROXY IN THE ENCLOSED ENVELOPE.
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NOTE: Please sign this proxy exactly as your name(s) appear(s) on
the books of the Corporation. Joint owners should each sign
personally. Trustees and other fiduciaries should indicate the
capacity in which they sign, and, where more than one name
appears, a majority must sign. If a corporation, the signature
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should be that of an authorized officer who should state his or
her title.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
_____________________________ _____________________________
_____________________________ _____________________________
_____________________________ _____________________________
2
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/ X / Please mark votes as in this example.
________________________________________________________________
ALLIANCE MUNICIPAL INCOME FUND, INC.
________________________________________________________________
Mark box at right if an address change or
comment has been noted of the reverse side of
this card. / /
CONTROL NUMBER:
Please be sure to sign and date this Proxy.
Date _____________________
Stockholder sign here Co-owner sign here
_______________________________ ______________________________
3
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1. Approval of the proposal FOR AGAINST ABSTAIN
to change a fundamental
investment policy of the / / / / / /
Portfolio to remove the
requirement that the Portfolio
invest at least 65% of its
total assets in securities
paying interest subject to the
federal alternative minimum
tax.
2. In their discretion, upon any
other matters that may properly
come before the Special Meeting
or any postponement or
adjournments thereof, as
described in the Proxy
Statement.
RECORD DATE SHARES:
4
00250011.AT4
