<PAGE>
ZENIX INCOME FUND INC.
388 GREENWICH STREET
NEW YORK, NEW YORK 10013
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------------
TO BE HELD ON JULY 10, 1996
----------------------
To the Shareholders of Zenix Income Fund Inc.:
The Annual Meeting of Shareholders of Zenix Income Fund Inc. (the "Fund")
will be held at the Fund's offices at 388 Greenwich Street, 22nd Floor, New
York, New York at 9:00 a.m. on July 10, 1996 for the following purposes:
1. To elect seven Directors to the Board of Directors (PROPOSAL 1);
2. To ratify the selection of KPMG Peat Marwick LLP as the independent
accountants of the Fund for the current fiscal year of the Fund (PROPOSAL
2);
3. To consider and vote upon such other matters as may come before said
meeting or any adjournment thereof.
The close of business on May 13, 1996 has been fixed as the record date for
the determination of shareholders entitled to notice of and to vote at the
meeting and any adjournment thereof.
By Order of the Board of Directors,
Christina T. Sydor
Secretary
May 31, 1996
----------------------
YOUR VOTE IS IMPORTANT REGARDLESS OF THE SIZE OF YOUR HOLDINGS IN THE FUND.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, WE ASK THAT YOU PLEASE COMPLETE
AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN THE ENCLOSED
ENVELOPE WHICH NEEDS NO POSTAGE IF MAILED IN THE CONTINENTAL UNITED STATES.
INSTRUCTIONS FOR THE PROPER EXECUTION OF PROXIES ARE SET FORTH ON THE INSIDE
COVER.
<PAGE>
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of assistance to
you and avoid the time and expense to the Fund involved in validating your
vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party
signing should conform exactly to a name shown in the registration.
3. All Other Accounts: The capacity of the individual signing the proxy
should be indicated unless it is reflected in the form of registration.
For example:
<TABLE>
<CAPTION>
REGISTRATION VALID SIGNATURE
------------ ---------------
<S> <C>
CORPORATE ACCOUNTS
(1) ABC Corp. ............................................ ABC Corp.
(2) ABC Corp. ............................................ John Doe, Treasurer
(3) ABC Corp.
c/o John Doe, Treasurer.......................... John Doe
(4) ABC Corp. Profit Sharing Plan......................... John Doe, Trustee
TRUST ACCOUNTS
(1) ABC Trust............................................. Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee
u/t/d 12/28/78................................... Jane B. Doe
CUSTODIAN OR ESTATE ACCOUNTS
(1) John B. Smith, Cust.
f/b/o John B. Smith, Jr. UGMA.................... John B. Smith
(2) Estate of John B. Smith............................... John B. Smith, Jr.,
Executor
</TABLE>
<PAGE>
ZENIX INCOME FUND INC.
388 GREENWICH STREET
NEW YORK, NEW YORK 10013
----------------------
ANNUAL MEETING OF SHAREHOLDERS
JULY 10, 1996
----------------------
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation by the
Board of Directors (the "Board") of Zenix Income Fund Inc. (the "Fund") of
proxies to be voted at the Annual Meeting of Shareholders (the "Meeting") of
the Fund to be held at the Fund's executive offices at 388 Greenwich Street,
22nd Floor, New York, New York 10013, on July 10 1996, and at any adjournments
thereof, for the purposes set forth in the accompanying Notice of Annual
Meeting of Shareholders.
The cost of soliciting proxies will be borne by the Fund. Proxy
solicitations will be made mainly by mail. In addition, certain officers,
directors and employees of: the Fund; Smith Barney Inc. ("Smith Barney"), the
Fund's distributor; and/or First Data Investor Services Group ("First Data"),
the Fund's transfer agent may solicit proxies in person or by telephone,
telegraph, or mail. Smith Barney and the Fund's investment adviser, Smith
Barney Mutual Funds Management Inc. ("SBMFM"), are each located at 388
Greenwich Street, New York, New York 10013; First Data is located at 53 State
Street, Boston, Massachusetts 02109.
The Annual Report of the Fund, including audited financial statements for
the fiscal year ended March 31, 1996, is included. This proxy statement and
form of proxy are first being mailed to shareholders on or about May 31, 1996.
The Fund will provide additional copies of the Annual Report to any
shareholder upon request by calling the Fund at 1-800-224-7523.
All properly executed proxies received prior to the Meeting will be voted at
the Meeting in accordance with the instructions marked thereon or otherwise as
provided therein. Unless instructions to the contrary are marked, shares
represented by proxies will be voted "FOR" all the proposals. For purposes of
determining the presence of a quorum for transacting business at the Meeting,
abstentions and broker "non-votes" (i.e., proxies from brokers or nominees
indicating that such persons have not received instructions from the
beneficial owner or other persons entitled to vote shares on a particular
matter with respect to which the brokers or nominees do not have discretionary
power) will be treated as shares that are present
<PAGE>
but which have not been voted. For this reason, abstentions and broker "non-
votes" will have the effect of a "no" vote for the purpose of obtaining the
required approval of a proposal.
In the event that sufficient votes in favor of the proposal set forth in the
Notice of Meeting and this Proxy Statement are not received by the time
scheduled for the Meeting, the persons named as proxies may move for one or
more adjournments of the Meeting to permit further solicitation of proxies
with respect to any such proposals. In determining whether to adjourn the
Meeting, the following factors may be considered: the nature of the proposals
that are subject to the Meeting, the percentage of votes actually cast, the
percentage of negative votes cast, the nature of any further solicitation and
the information to be provided to shareholders with respect to reasons for the
solicitations.
The Board knows of no business other than that specifically mentioned in the
Notice of Meeting which will be presented for consideration at the Meeting. If
any other matters are properly presented, it is the intention of the person
named in the enclosed proxy to vote in accordance with their best judgment.
The Board of Directors of the Fund has fixed the close of business on May
13, 1996 as the record date (the "Record Date") for the determination of
shareholders of the Fund entitled to notice of and to vote at the Meeting or
any adjournment thereof. Shareholders of the Fund on that date will be
entitled to vote on each matter relevant to the class of shares held with no
cumulative voting rights.
The Fund has two classes of shares: common shares which have a par value of
$.01 per share (the "Common Shares"), and cumulative preferred shares, which
have a par value of $.01 per share and a liquidation preference in the amount
of $1,000 per share (the "Preferred Shares" and collectively with the Common
Shares, the "Shares"). On the Record Date, there were 14,269,989.233 Common
Shares and 30,000 Preferred Shares outstanding. Each shareholder is entitled
to one vote for each Share held and a proportionate fraction of a vote for any
fractional Share held.
At the close of business on the Record Date, the Fund had outstanding
14,269,989.233 Common Shares, of which 12,315,416 were held in accounts but
not beneficially owned by CEDE & Co., c/o Depository Trust Company, Box 20
Bowling Green Station, New York, New York 10004-9998. At the close of business
on the Record Date, the Fund had outstanding 30,000 Preferred Shares, of which
100% were held in accounts but not beneficially owned by CEDE & Co., c/o
Depository Trust Company, Box 20 Bowling Green Station, New York, New York
10004-9998. At the close of business on the Record Date, no other person
(including any "group" as that term is used in Section 13(d) of the Exchange
Act of 1934 (the "Exchange Act")) to the knowledge of the Board of
2
<PAGE>
Directors or the Fund, owned beneficially more than 5% of the outstanding
shares of the Fund. As of the Record Date, the officers and Board Members of
the Fund beneficially owned less than 1% of the outstanding Shares of the
Fund.
To the knowledge of the Fund, no shares of Smith Barney's ultimate parent
corporation, Travelers Group Inc. ("Travelers"), were held by Board Members
who are not interested persons of the Fund (as that term is used in the
Investment Company Act of 1940, as amended (the "1940 Act")) as of the Record
Date.
In order that a shareholder's Shares may be represented at the Meeting,
shareholders are required to allow sufficient time for their proxies to be
received on or before 9:00 a.m. on July 9, 1996. All proxies received will be
voted in favor of all the proposals, unless otherwise directed therein.
PROPOSAL 1
TO ELECT SEVEN (7) DIRECTORS OF THE FUND
The first proposal to be considered at the Meeting is the election of seven
(7) Directors of the Fund.
Under the terms of the Fund's Charter, the holders of Preferred Shares are
entitled as a class, to the exclusion of the holders of Common Shares, to
elect two Directors of the Fund. Charles F. Barber and Robert A. Frankel have
been nominated by the Fund's Board of Directors for election by holders of
Preferred Shares ("Preferred Directors"). The Fund's Charter further provides
that the holders of the Fund's Common Shares are entitled as a class, to the
exclusion of holders of Preferred Shares, to elect two Directors of the Fund.
Martin Brody and Dwight B. Crane have been nominated by the Fund's Board of
Directors for election by holders of the Fund's Common Shares ("Common
Directors"). The Fund's Charter provides that the remaining nominees, Heath B.
McLendon, Allan J. Bloostein and William R. Hutchinson, shall be elected by
holders of Common and Preferred Shares voting together as a single class.
The Board of Directors of the Fund knows of no reason why any of the
nominees listed below will be unable to serve, but in the event of any such
unavailability, the proxies received will be voted for such substitute
nominees as the Board of Directors may recommend.
Certain information concerning the nominees is set forth below. All the
individuals listed are currently Directors of the Fund. Any Director
considered an "interested person" as defined in the 1940 Act is indicated by
an asterisk (*).
3
<PAGE>
PERSONS NOMINATED FOR ELECTION AS DIRECTORS
<TABLE>
<CAPTION>
NAME, AGE, PRINCIPAL OCCUPATION SERVED AS NUMBER OF FUND
AND OTHER BUSINESS EXPERIENCE A DIRECTOR SHARES BENEFICIALLY
DURING THE PAST FIVE YEARS SINCE CLASS OWNED AS OF MAY 13, 1996
- --------------------------------- ---------- ----- ------------------------
<S> <C> <C> <C>
Charles F. Barber (76) 1989 Preferred 2,521
Consultant; formerly Chairman of
the Board,
ASARCO Incorporated
Allan J. Bloostein (64) 1992 Common & None
Consultant, formerly Vice Preferred
Chairman of the Board of May
Department Stores Company;
Director of Crystals Brands,
Inc., Melville Corp.,
R.G. Barry Corp. and Hechinger
Co.
Martin Brody (74) 1988 Common 91,456
Vice Chairman of the Board of
Directors of Restaurant
Associates Corp.; Director of
Jaclyn, Inc., an apparel
manufacturer
Dwight B. Crane (58) 1988 Common 460
Professor, Graduate School of
Business Administration,
Harvard University
Robert A. Frankel (68) 1994 Preferred 218
Managing Partner of Robert A.
Frankel Management Consultants;
formerly Corporate Vice President
of The Readers Digest Assoc. Inc.
William R. Hutchinson (53) 1995 Common & None
Vice President Financial Preferred
Operations AMOCO Corporation;
Director of Associated Bank since
1981; Director of Associated
Banc-Corp since 1994
Heath B. McLendon* (63) 1988 Common & 19,730
Managing Director of Smith Barney Preferred
Inc.; Chairman of Smith Barney
Strategy Advisers Inc. and
President of SBMFM; prior to July
1993, Senior Executive Vice
President of Shearson Lehman
Brothers Inc., Vice Chairman of
Asset Management Division of
Shearson Lehman Brothers Inc.,
Director of PanAgora Asset
Management, Inc. and PanAgora
Asset Management Limited
</TABLE>
4
<PAGE>
Section 16(a) of the Exchange Act and Section 30(f) of the Investment
Company Act of 1940 requires the Fund's officers and Directors, persons who
beneficially own more than ten percent of the Fund's Common Shares, and to
certain other entities to file reports of ownership with the Securities and
Exchange Commission, the New York Stock Exchange, Inc. and the Fund. Based
solely upon its review of the copies of such forms received by it and written
representation from such persons, the Fund believes that during the fiscal
year ended 1995, all filing requirements applicable to such persons were
complied with. Based solely upon its review of the copies of such forms
received by it and representations from such persons, the Fund believes that
during its fiscal year ended March 31, 1996, all filing requirements
applicable to such persons were complied with.
The Fund has no compensation or nominating committee of the Board of
Directors, or any committee performing similar functions. The Fund has an
audit committee composed of Directors who are not interested persons of the
Fund (the "Independent Directors") which is charged with recommending a firm
of independent auditors to the Fund and reviewing accounting matters with the
auditors.
During the Fund's fiscal year each Director attended at least 75% of the
meetings held during the period he was in office.
Only the Independent Directors receive remuneration from the Fund for acting
as a Director. Aggregate fees of $31,000 were paid to such Directors by the
Fund during the fiscal year ended March 31, 1996. Fees for Independent
Directors are set at $5,000 per annum plus $500 per in-person Board meeting
and $100 per telephone conference call. Officers of the Fund are compensated
by Smith Barney.
The following table shows the compensation paid by the Fund to each
Director, during the Fund's last fiscal year:
<TABLE>
<CAPTION>
TOTAL
COMPENSATION
FROM FUND
TOTAL COMPLEX FOR THE
COMPENSATION YEAR ENDED
NAME OF PERSON* FROM FUND DECEMBER 31, 1995
--------------- ------------ -----------------
<S> <C> <C>
Charles F. Barber (6)# $5,750 $34,500
Martin Brody (19) $5,750 $34,500
Dwight B. Crane (22) $5,750 $34,500
Allan J. Bloostein (8) $5,750 $34,500
Robert A. Frankel (8) $5,750 $34,500
William R. Hutchinson (6) $2,250 $ 7,875
Heath B. McLendon (41) -- --
</TABLE>
- -----------
* Indicates the number of funds within the Smith Barney mutual fund complex
for which the Director serves as a Board Member.
# Pursuant to the Fund's deferred compensation plan, Mr. Barber elected
effective January 2, 1996, to defer the payment of some or all of the
compensation due to him from the Fund.
5
<PAGE>
The following is a list of the current executive officers of the Fund all of
whom have been elected by the Directors to serve until their respective
successors are elected:
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATIONS AND
POSITION OTHER AFFILIATIONS
NAME AND AGE (YEAR FIRST ELECTED) DURING THE PAST FIVE YEARS
------------ -------------------- --------------------------
<S> <C> <C>
Heath B. McLendon, 63 Chief Executive Officer and (see table of Directors
Chairman of the Board (1988) above)
Jessica M. Bibliowicz, President (1995) Executive Vice President
36 of Smith Barney Inc.;
prior to 1994, Director
of Sales and Marketing
for Prudential Mutual
Funds; prior to 1991,
First Vice President,
Asset Management
Division of Shearson
Lehman Brothers Inc.
Lewis E. Daidone, 37 Senior Vice President and Chief Financial Officer,
Treasurer; Managing Director and Senior Vice
of Smith Barney Inc. (1992) President of SBMFM.
John C. Bianchi, 39 Vice President and Managing Director of
Investment Officer (1993) SBMFM; Investment
Officer prior to July
1993, Managing Director
of Shearson Lehman
Advisors.
Christina T. Sydor, 45 Secretary (1992) Managing Director of
Smith Barney Inc.;
General Counsel and
Secretary of SBMFM.
</TABLE>
The principal business address of Ms. Bibliowicz, Mr. Bianchi, Mr. Daidone
and Ms. Sydor is 388 Greenwich Street, New York, New York 10013.
The Board of Directors, including all of the Independent Directors,
recommends that you vote "FOR" the election of nominees to the Board. Proposal
1 requires for approval the affirmative vote of a plurality of votes cast at
the Meeting with a quorum present, in person or by proxy, by the shareholders
of the Fund voting on the matter.
PROPOSAL 2
RATIFICATION OF SELECTION OF KPMG PEAT MARWICK LLP AS THE INDEPENDENT
ACCOUNTANTS FOR THE FUND FOR THE CURRENT FISCAL YEAR
KPMG Peat Marwick LLP ("KPMG") have been selected as the independent
accountants to audit the accounts of the Fund for the fiscal year ending March
31, 1997 by a majority of the Independent Directors by a vote cast in person
subject to ratification by the shareholders at the Meeting (the entire Board
concurred in the selection). KPMG also serves as the independent auditors for
the Fund, other
6
<PAGE>
investment companies associated with Smith Barney and for Travelers Group Inc.
KPMG has no direct or material indirect financial interest in the Fund,
Travelers or any other investment company sponsored by Smith Barney or its
affiliates.
Coopers & Lybrand L.L.P ("Coopers & Lybrand") served as the Fund's
independent accountants for the fiscal year ended March 31, 1995. On May 24,
1995, based upon the recommendation of the Audit Committee of the Fund's Board
of Directors, and in accordance with Section 32 of the 1940 Act, and the rules
thereunder, the Board voted to appoint KPMG as the Fund's independent
accountants for the fiscal year ended March 31, 1996. During the fiscal year
ended March 31, 1995, Coopers & Lybrand's reports on the Fund's financial
statements contained no adverse opinion or disclaimer of opinion, nor were
they qualified or modified as to uncertainty, audit scope, or accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure, which disagreements, if not resolved to the satisfaction of Coopers
& Lybrand, would have caused it to make reference to the subject matter of the
disagreement in connection with its report. During this period, there were no
"reportable events" as such term is described in Item 304(a)(1)(v) of
Regulation S-K with respect to Coopers & Lybrand.
If the Fund receives a written request from any shareholder at least five
days prior to the Meeting stating that the shareholder will be present at the
Meeting and desires to ask questions of the auditors concerning the Fund's
financial statements, the Fund will arrange to have representatives of KPMG
present at the Meeting who will respond to appropriate questions and who will
have an opportunity to make a statement.
The affirmative vote of a majority of shares present and voting at the
Meeting is required to ratify the selection of KPMG. The Board of Directors,
including all of the Independent Directors, recommends that the shareholders
vote "FOR" the ratification of the selection of independent accountants.
DEADLINE FOR SHAREHOLDER PROPOSALS
Shareholders proposals intended to be presented at the 1997 Annual Meeting
of the Shareholders of the Fund must be received by January 6, 1997 to be
considered at this meeting.
7
