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:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
Investment Grade Municipal Income Fund
-----------------------------------------------
(Name of Registrant as Specified In Its Charter)
-----------------------------------------
(Name of Person(s) Filing Proxy Statement)
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) 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. 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:
<PAGE>
INVESTMENT GRADE MUNICIPAL INCOME FUND INC.
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NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
JANUARY 20, 2000
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TO THE SHAREHOLDERS:
The annual meeting of shareholders of Investment Grade Municipal Income
Fund Inc. ("Fund") will be held on January 20, 2000 at 10:00 a.m., Eastern time,
at 1285 Avenue of the Americas, 14th Floor, New York, New York 10019 for the
following purposes:
MATTERS TO BE VOTED UPON BY ALL SHAREHOLDERS:
(1) To elect eight (8) directors to serve until the annual meeting of
shareholders in 2001, or until their successors are elected and qualified;
(2) To ratify the selection of PricewaterhouseCoopers LLP as the
Fund's independent accountants, for the fiscal year ending September 30,
2000; and
(3) To transact such other business as may properly come before the
meeting or any adjournment thereof.
MATTERS TO BE VOTED UPON ONLY BY HOLDERS OF AUCTION PREFERRED SHARES:
(4) To elect two (2) directors to serve until the annual meeting of
shareholders in 2001 or until their successors are elected and qualified.
You are entitled to vote at the meeting and any adjournments thereof if you
owned Fund shares at the close of business on November 19, 1999. If you attend
the meeting, you may vote your shares in person. IF YOU DO NOT EXPECT TO ATTEND
THE MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD IN
THE ENCLOSED POSTAGE PAID ENVELOPE.
By order of the board of directors,
DIANNE E. O'DONNELL
SECRETARY
November 29, 1999
51 West 52nd Street
New York, New York 10019-6114
YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN
PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD, DATE AND
SIGN IT, AND RETURN IT IN THE ENVELOPE PROVIDED. IF YOU SIGN, DATE AND RETURN
THE PROXY CARD BUT GIVE NO VOTING INSTRUCTIONS, YOUR SHARES WILL BE VOTED "FOR"
THE NOMINEES FOR DIRECTOR FOR WHICH YOU ARE ENTITLED TO CAST A VOTE NAMED IN THE
ATTACHED PROXY STATEMENT AND "FOR" ALL OTHER PROPOSALS NOTICED ABOVE. IN ORDER
TO AVOID THE ADDITIONAL EXPENSE TO THE FUND OF FURTHER SOLICITATION, WE ASK YOUR
COOPERATION IN MAILING IN YOUR PROXY CARD PROMPTLY.
<PAGE>
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general guidelines for signing proxy cards may be of
assistance to you and avoid the time and expense to the Fund 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 the name shown in the registration on the proxy card.
3. ALL OTHER ACCOUNTS: The capacity of the individual signing the proxy
card should be indicated unless it is reflected in the form of registration. For
example:
<TABLE>
<CAPTION>
REGISTRATION VALID SIGNATURE
------------ ---------------
Corporate Accounts
<S> <C>
(1) ABC Corp. ........................................... ABC Corp.
John Doe, Treasurer
(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
Partnership Accounts
(1) The XYZ Partnership.................................. Jane B. Smith, Partner
(2) Smith and Jones, Limited Partnership................. Jane B. Smith, General Partner
Trust Accounts
(1) ABC Trust Account.................................... Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee u/t/d 12/18/78.................. Jane B. Doe
Custodial or Estate Accounts
(1) John B. Smith, Cust.
f/b/o John B. Smith, Jr. UGMA/UTMA .................. John B. Smith
(2) Estate of John B. Smith.............................. John B. Smith, Jr., Executor
</TABLE>
<PAGE>
INVESTMENT GRADE MUNICIPAL INCOME FUND INC.
51 WEST 52ND STREET
NEW YORK, NEW YORK 10019-6114
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PROXY STATEMENT
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ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON JANUARY 20, 2000
This statement is furnished to the shareholders of Investment Grade
Municipal Income Fund Inc. ("Fund") in connection with the board of directors'
solicitation of proxies to be used at the annual meeting of shareholders of the
Fund to be held on January 20, 2000, or any adjournment or adjournments thereof.
This proxy statement and the related proxy card will first be mailed to
shareholders on or about November 29, 1999.
A majority of the shares outstanding on November 19, 1999, represented in
person or by proxy, must be present for the transaction of business at the
meeting. In the event that a quorum is not present at the annual meeting
(including a quorum of the Fund's auction preferred shares ("APS") with respect
to the election of the two directors to be elected by the APS), or if a quorum
is present at the annual meeting but sufficient votes to approve any of the
proposals are not received, the persons named as proxies may propose one or more
adjournments of the annual meeting to permit further solicitation of proxies.
Any such adjournment will require the affirmative vote of a majority of those
shares represented at the annual meeting in person or by proxy. The persons
named as proxies will vote those proxies which they are entitled to vote FOR any
such proposal in favor of such an adjournment and will vote those proxies
required to be voted AGAINST any such proposal against such adjournment. A
shareholder vote may be taken on one or more of the proposals in this proxy
statement prior to any such adjournment if sufficient votes have been received
and it is otherwise appropriate.
Broker non-votes are shares held in street name for which the broker
indicates that instructions have not been received from the beneficial owners or
other persons entitled to vote and for which the broker does not have
discretionary voting authority. Abstentions and broker non-votes will be counted
as shares present for purposes of determining whether a quorum is present but
will not be voted for or against any adjournment or proposal. Accordingly,
abstentions and broker non-votes effectively will be a vote against adjournment
but will have no effect on Proposal 1 and 4, for which the required vote is a
plurality, or Proposal 2, for which the required vote is a majority, of the
votes cast.
Except as otherwise indicated herein, all of the outstanding shares of the
Fund's common stock and APS will vote together as a single class. Each full
share of the Fund's common stock or APS is entitled to one vote and each
fractional share of the Fund's common stock or APS is entitled to a
proportionate share of one vote. However, as described below in connection with
Proposals 1 and 4, the holders of the APS, voting as a separate class, are
entitled to elect two of the Fund's directors.
The individuals named as proxies on the enclosed proxy card will vote in
accordance with your direction as indicated thereon if your proxy card is
received properly executed by you or your duly appointed agent or
attorney-in-fact. With respect to the holders of the APS, if you give no voting
instructions, your shares will be voted FOR the ten nominees for director named
herein and FOR the remaining proposals described in this proxy statement. With
respect to the holders of the Fund's common stock, if you give no voting
instructions, your shares will be voted FOR the eight nominees for director for
which the holders of the common stock are
<PAGE>
entitled to vote and FOR the remaining proposals described in this proxy
statement. You may revoke any proxy card by giving another proxy or by letter or
telegram revoking the initial proxy. To be effective, your revocation must be
received by the Fund prior to the meeting and must indicate your name and
account number. In addition, if you attend the annual meeting in person you may,
if you wish, vote by ballot at the meeting, thereby cancelling any proxy
previously given.
As of the record date, November 19, 1999, the Fund had outstanding
10,356,667 shares of common stock and 1600 shares of the APS, representing
Series A and Series B shares. The solicitation of proxies, the cost of which
will be borne by the Fund, will be made primarily by mail but also may include
telephone or oral communications by regular employees of Mitchell Hutchins Asset
Management Inc. ("Mitchell Hutchins") or PaineWebber Incorporated
("PaineWebber"), who will not receive any compensation therefor from the Fund.
Management does not know of any person who owns beneficially 5% or more of the
shares of the Fund.
Mitchell Hutchins serves as the Fund's investment adviser and
administrator. Mitchell Hutchins is a wholly owned asset management subsidiary
of PaineWebber, which is a wholly owned subsidiary of Paine Webber Group Inc.
("PW Group"), a publicly held financial services holding company. The principal
business address of Mitchell Hutchins is 51 West 52nd Street, New York, New York
10019-6114 and the principal business address for PaineWebber and PW Group is
1285 Avenue of the Americas, New York, New York 10019.
The Fund's annual report containing financial statements for the fiscal
year ended September 30, 1999, is being mailed to shareholders concurrently with
this proxy statement.
PROPOSALS 1 AND 4. ELECTION OF DIRECTORS
Proposals 1 and 4 relate to the election of directors of the Fund.
Management proposes the election of the ten nominees named in the table below.
Each nominee, including those who are not "interested persons" of the Fund as
that term is defined by the Investment Company Act of 1940 ("1940 Act")
("Independent Directors"), has indicated his or her willingness to serve if
elected. If elected, each nominee will hold office until the next annual meeting
of shareholders or until his or her successor is elected and qualified.
Holders of the outstanding shares of the APS, voting as a separate class,
are entitled to elect two of the Fund's directors. Margo N. Alexander and Meyer
Feldberg have been nominated as the directors that are to be elected by holders
of the APS. The other eight directors will be elected by holders of the
outstanding common stock and APS, voting together as a single class. Richard Q.
Armstrong, E. Garrett Bewkes, Jr., Richard R. Burt, Mary C. Farrell, George W.
Gowen, Frederic V. Malek, Carl W. Schafer and Brian M. Storms have been
nominated as the directors that are to be elected by all common stock and APS
holders. Unless you give contrary instructions on the enclosed proxy card: if
you are a holder of the APS, your shares will be voted FOR the election of all
ten nominees; and, if you are a holder of the common stock, your shares will be
voted FOR the eight nominees that are to be elected by all common stock and APS
holders. If any of the nominees should withdraw or otherwise become unavailable
for election, your shares will be voted FOR such other nominee or nominees as
management may recommend.
Mr. Feldberg and, except for a brief period during 1993, Mr. Bewkes have
served as directors of the Fund since its inception. Messrs. Armstrong and Burt
have served as directors of the Fund since February 15, 1995. Mrs. Alexander has
served as a director of the Fund since January 18, 1996. Messrs. Gowen, Malek
and Schafer and Ms. Farrell have served as directors of the Fund since April 11,
1996. On May 13, 1999, the board increased the number of board members to ten
and appointed Mr. Storms to fill the vacancy created
2
<PAGE>
by the expansion. Directors will be elected by the affirmative vote of the
holders of a plurality of the shares of the Fund present in person or by proxy
and entitled to vote thereon, provided a quorum is present. If each of the ten
nominees is elected, they will constitute the entire board of directors of the
Fund. None of the current directors and executive officers (21 persons)
beneficially owned any shares of the Fund's common stock or APS on October 31,
1999.
<TABLE>
<CAPTION>
PRESENT POSITION WITH THE SHARES OWNED
FUND; BUSINESS EXPERIENCE DURING BENEFICIALLY ON
NOMINEE; AGE PAST FIVE YEARS; OTHER DIRECTORSHIPS OCTOBER 31, 1999**
------------ ------------------------------------ ------------------
<S> <C> <C>
Margo N. Alexander; 52* DIRECTOR AND PRESIDENT. Mrs. Alexander is --
chairman (since March, 1999), chief executive
officer and a director of Mitchell Hutchins
(since January 1995) and an executive vice
president and director of PaineWebber (since
March 1984). Mrs. Alexander is president and a
director or trustee of 32 investment companies
for which Mitchell Hutchins, PaineWebber or
one of their affiliates serves as investment
adviser.
Richard Q. Armstrong; 64 DIRECTOR. Mr. Armstrong is chairman and --
principal of R.Q.A. Enterprises (management
consulting firm) (since April 1991 and
principal occupation since March 1995). Mr.
Armstrong was chairman of the board, chief
executive officer and co-owner of Adirondack
Beverages (producer and distributor of soft
drinks and sparkling/still waters) (October
1993-March 1995). He was a partner of The New
England Consulting Group (management
consulting firm) (December 1992-September
1993). He was managing director of LVMH U.S.
Corporation (U.S. subsidiary of the French
luxury goods conglomerate, Louis Vuitton Moet
Hennessey Corporation) (1987-1991) and
chairman of its wine and spirits subsidiary,
Schieffelin & Somerset Company (1987-1991).
Mr. Armstrong is a director or trustee of 31
investment companies for which Mitchell
Hutchins, PaineWebber or one of their
affiliates serves as investment adviser.
E. Garrett Bewkes, Jr.; 73* DIRECTOR AND CHAIRMAN OF THE BOARD OF --
DIRECTORS. Mr. Bewkes is a director of PW
Group (holding company of PaineWebber and
Mitchell Hutchins). Prior to December 1995, he
was a consultant to PW Group. Prior to 1988,
he was chairman of the board, president and
chief executive officer of American Bakeries
Company. Mr. Bewkes is also a director of
Interstate Bakeries Corporation. Mr. Bewkes is
a director or trustee of 35 investment
companies for which Mitchell Hutchins,
PaineWebber or one of their affiliates serves
as investment adviser.
3
<PAGE>
Richard R. Burt; 52 DIRECTOR. Mr. Burt is chairman of IEP --
Advisors, LLP (international investments and
consulting firm) (since March 1994) and a
partner of McKinsey & Company (management
consulting firm) (since 1991). He is also a
director of Archer-Daniels-Midland Co.
(agricultural commodities), Hollinger
International Co. (publishing), Homestake
Mining Corp. and Powerhouse Technologies Inc.,
and chairman of Weirton Steel Corp. (since
April 1996). He was the chief negotiator in
the Strategic Arms Reduction Talks with the
former Soviet Union (1989-1991) and the U.S.
Ambassador to the Federal Republic of Germany
(1985-1989). Mr. Burt is a director or trustee
of 31 investment companies for which Mitchell
Hutchins, PaineWebber or one of their
affiliates serves as investment adviser.
Mary C. Farrell; 49* DIRECTOR. Ms. Farrell is a managing director, --
senior investment strategist and member of the
Investment Policy Committee of PaineWebber.
Ms. Farrell joined PaineWebber in 1982. She is
a member of the Financial Women's Association
and Women's Economic Roundtable and appears as
a regular panelist on WALL $TREET WEEK with
Louis Rukeyser. She also serves on the Board
of Overseers of New York University's Stern
School of Business. Ms. Farrell is a director
or trustee of 30 investment companies for
which Mitchell Hutchins, PaineWebber or one of
their affiliates serves as investment adviser.
Meyer Feldberg; 57 DIRECTOR. Mr. Feldberg is Dean and Professor --
of Management of the Graduate School of
Business, Columbia University. Prior to 1989,
he was president of the Illinois Institute of
Technology. Dean Feldberg is also a director
of Primedia Inc., Federated Department Stores,
Inc. and Revlon, Inc. Dean Feldberg is a
director or trustee of 34 investment companies
for which Mitchell Hutchins, PaineWebber or
one of their affiliates serves as investment
adviser.
4
<PAGE>
George W. Gowen; 70 DIRECTOR. Mr. Gowen is a partner in the law --
firm of Dunnington, Bartholow & Miller. Prior
to May 1994, he was a partner in the law firm
of Fryer, Ross & Gowen. Mr. Gowen is a
director or trustee of 34 investment companies
for which Mitchell Hutchins, PaineWebber or
one of their affiliates serves as investment
adviser.
Frederic V. Malek; 62 DIRECTOR. Mr. Malek is chairman of Thayer --
Capital Partners (merchant bank). From January
1992 to November 1992, he was campaign manager
of Bush-Quayle '92. From 1990 to 1992, he was
vice chairman and, from 1989 to 1990, he was
president of Northwest Airlines Inc. and NWA
Inc. (holding company of Northwest Airlines
Inc.). Prior to 1989, he was employed by the
Marriott Corporation (hotels, restaurants,
airline catering and contract feeding), where
he most recently was an executive vice
president and president of Marriott Hotels and
Resorts. Mr. Malek is also a director of Aegis
Communication Inc. (teleservices), American
Management Systems, Inc. (management
consulting and computer related services),
Automatic Data Processing, Inc. (computing
services), CB Richard Ellis, Inc. (real estate
services), FPL Group, Inc. (electric
services), Global Vacation Group (packaged
vacations), HCR/Manor Care, Inc. (health care)
and Northwest Airlines Inc. Mr. Malek is a
director or trustee of 31 investment companies
for which Mitchell Hutchins, PaineWebber or
one of their affiliates serves as investment
adviser.
Carl W. Schafer; 63 DIRECTOR. Mr. Schafer is president of the --
Atlantic Foundation (charitable foundation
supporting mainly oceanographic exploration
and research). He is a director of Labor
Ready, Inc. (temporary employment), Roadway
Express, Inc. (trucking), The Guardian Group
of Mutual Funds, the Harding, Loevner Funds,
Evans Systems, Inc. (motor fuels, convenience
store and diversified company), Electronic
Clearing House, Inc. (financial transactions
processing), Frontier Oil Corporation and
Nutraceutix, Inc. (biotechnology company).
Prior to January 1993, he was chairman of the
Investment Advisory Committee of the Howard
Hughes Medical Institute. Mr. Schafer is a
director or trustee of 31 investment companies
for which Mitchell Hutchins, PaineWebber or
one of their affiliates serves as an
investment adviser.
(FOOTNOTES ON NEXT PAGE)
5
<PAGE>
Brian M. Storms**; 45 DIRECTOR. Mr. Storms is president and chief --
operating officer of Mitchell Hutchins (since
March 1999). Mr. Storms was president of
Prudential Investments (1996-1999). Prior to
joining Prudential he was a managing director
at Fidelity Investments. Mr. Storms is a
director or trustee of 31 investment companies
for which Mitchell Hutchins, PaineWebber or
one of their affiliates serves as investment
adviser.
</TABLE>
* Mrs. Alexander, Mr. Bewkes, Ms. Farrell and Mr. Storms are "interested
persons" of the Fund as defined by the 1940 Act by virtue of their positions
with Mitchell Hutchins, PaineWebber and/or PW Group.
** Unless otherwise stated, as of the date indicated, each director had sole
voting and investment power of shares owned.
The board of directors of the Fund met six times during the fiscal year
ended September 30, 1999. Each of the directors attended 75% or more of the
board meetings during the last fiscal year. The Audit and Contract Review
Committee ("ACR Committee") of the board currently consists of Messrs.
Armstrong, Burt, Feldberg, Gowen, Malek and Schafer. The ACR Committee has
established a sub-committee that periodically reviews the contractual and audit
arrangements for the Fund and reports back to the full ACR Committee. Messrs.
Burt, Feldberg and Schafer are members of this sub-committee. Each member of the
Fund's ACR Committee is also a member of a similar committee established by the
boards of other investment companies for which Mitchell Hutchins or PaineWebber
serves as investment adviser and also may be a member of a sub-committee
established by another fund's audit and contract review committee. The duties of
the ACR Committee are, (a) to review the financial and accounting policies of
the Fund, including internal accounting control procedures, and to review
reports prepared by the Fund's independent accountants, including reports on the
Fund's financial statements; (b) to review and recommend approval or disapproval
of audit and non-audit services and the fees charged for such services; (c) to
evaluate the independence of the independent accountants and to recommend
whether to retain such independent accountants for the next fiscal year; and (d)
to report to the board and make such recommendations as it deems necessary. The
ACR Committee and its sub-committee each met once during the Fund's fiscal year
ended September 30, 1999. Each member of the ACR Committee and sub-committee
attended those meetings.
The board does not have a standing nominating or compensation committee.
The Fund pays the Independent Directors $1,000 annually and up to $150 for each
board meeting and for each separate meeting of a board committee. The Chairmen
of the audit and contract review committees of individual funds within the
PaineWebber fund complex receive additional annual compensation aggregating
$15,000 each from the relevant funds. Directors of the Fund who are "interested
persons" as defined by the 1940 Act receive no compensation from the Fund.
Directors are reimbursed for any expenses incurred in attending meetings. Each
director will be subject to mandatory retirement at the end of the year in which
he or she becomes 72 years old. The board has waived this requirement with
respect to Mr. Bewkes for the next year. The table below includes certain
information relating to the compensation of the Fund's directors.
6
<PAGE>
COMPENSATION TABLE+
TOTAL
AGGREGATE COMPENSATION
COMPENSATION FROM THE FUND
NAME OF FROM AND THE
PERSON, POSITION THE FUND* FUND COMPLEX**
---------------- ------------ --------------
Richard Q. Armstrong, Director ....... $1,810 $101,372
Richard R. Burt, Director ............ $1,780 $101,372
Meyer Feldberg, Director ............. $2,462 $116,222
George W. Gowen, Director ............ $1,810 $108,272
Frederic V. Malek, Director .......... $1,810 $101,372
Carl W. Schafer, Director ............ $1,810 $101,372
- ----------
+ Only independent members of the board are compensated by the Fund and
identified above; directors who are "interested persons," as defined by the
1940 Act, do not receive compensation.
* Represents fees paid to each director during the fiscal year ended September
30, 1999.
** Represents total compensation paid to each director by 31 investment
companies (34 in the case of Messrs. Feldberg and Gowen) for which Mitchell
Hutchins, PaineWebber or one of their affiliates served as investment
adviser during the twelve months ended December 31, 1998; no fund within the
complex has a bonus, pension, profit sharing or retirement plan.
PROPOSAL 2. RATIFICATION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Fund's financial statements for the fiscal year ended September 30,
1999 were audited by PricewaterhouseCoopers LLP ("Pricewaterhouse"), independent
accountants. In addition, PriceWaterhouse prepares the Fund's federal and state
annual income tax returns.
The board of directors of the Fund has selected Pricewaterhouse as the
independent accountants for the Fund for the fiscal year ending September 30,
2000, subject to ratification by shareholders of the Fund at the annual meeting.
Pricewaterhouse has been the Fund's independent accountants since its inception
in November 1992. The ratification of Pricewaterhouse as independent accountants
is to be voted upon at the annual meeting, and it is intended that the persons
named in the accompanying proxy will vote FOR such ratification unless contrary
instructions are given. Pricewaterhouse has informed the Fund that it has no
material direct or indirect financial interest in the Fund. The affirmative vote
of the holders of a majority of the shares of the Fund cast at the annual
meeting is required for ratification, provided a quorum is present.
Representatives of Pricewaterhouse are not expected to be present at the
meeting but have been given the opportunity to make a statement if they so
desire and will be available should any matter arise requiring their presence.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE "FOR" PROPOSAL 2.
7
<PAGE>
EXECUTIVE OFFICERS
Officers of the Fund are appointed by the directors and serve at the
pleasure of the board. None of the Fund's officers currently receives any
compensation from the Fund. The executive officers of the Fund, other than Mrs.
Alexander, who is a nominee for director, are:
CYNTHIA N. BOW, age 41, vice president of the Fund (appointed December 1996)
and a portfolio manager of Mitchell Hutchins. Ms. Bow has been with Mitchell
Hutchins since 1982. Ms. Bow is a vice president of two investment companies for
which Mitchell Hutchins, Paine Webber or one of their affiliates serves as
investment adviser.
ELBRIDGE T. GERRY III, age 42, vice president of the Fund (appointed April
1996). Mr. Gerry is a senior vice president and a portfolio manager of Mitchell
Hutchins. Prior to January 1996, he was with J.P. Morgan Private Banking where
he was responsible for managing municipal assets, including several municipal
bond funds. Mr. Gerry is a vice president of five investment companies for which
Mitchell Hutchins, PaineWebber or one of their affiliates serves as investment
adviser.
JOHN J. LEE, age 31, vice president and assistant treasurer of the Fund
(appointed May 1998). Mr. Lee is a vice president and a manager of the mutual
fund finance department of Mitchell Hutchins. Prior to September 1997, he was an
audit manager in the financial services practice of Ernst & Young LLP. Mr. Lee
is a vice president and assistant treasurer of 32 investment companies for which
Mitchell Hutchins, PaineWebber or one of their affiliates serves as investment
adviser.
DENNIS MCCAULEY, age 53, vice president of the Fund (appointed September
1995). Mr. McCauley is a managing director and chief investment officer-fixed
income of Mitchell Hutchins. Prior to December 1994, he was director of fixed
income investments of IBM Corporation. Mr. McCauley is a vice president of 22
investment companies for which Mitchell Hutchins, PaineWebber or one of their
affiliates serves as investment adviser.
ANN E. MORAN, age 42, vice president and assistant treasurer of the Fund
(appointed June 1993). Ms. Moran is a vice president and a manager of the mutual
fund finance department of Mitchell Hutchins. Ms. Moran is a vice president and
assistant treasurer of 32 investment companies for which Mitchell Hutchins,
PaineWebber or one of their affiliates serves as investment adviser.
DIANNE E. O'DONNELL, age 47, vice president and secretary of the Fund
(appointed August 1992). Ms. O'Donnell is a senior vice president and deputy
general counsel of Mitchell Hutchins. Ms. O'Donnell is a vice president and
secretary of 31 investment companies and a vice president and assistant
secretary of one investment company for which Mitchell Hutchins, PaineWebber or
one of their affiliates serves as investment adviser.
EMIL POLITO, age 39, vice president of the Fund (appointed September 1996).
Mr. Polito is a senior vice president and director of operations and control for
Mitchell Hutchins. Mr. Polito is a vice president of 32 investment companies for
which Mitchell Hutchins, PaineWebber or one of their affiliates serves as
investment adviser.
VICTORIA E. SCHONFELD, age 48, vice president of the Fund (appointed May
1994). Ms. Schonfeld is a managing director and general counsel of Mitchell
Hutchins since May 1994 and a senior vice president of PaineWebber since July
1995. Ms. Schonfeld is a vice president of 31 investment companies and a vice
president and secretary of one investment company for which Mitchell Hutchins,
PaineWebber or one of their affiliates serves as investment adviser.
8
<PAGE>
PAUL H. SCHUBERT, age 36, vice president (appointed September 1994) and
treasurer (appointed May 1997) of the Fund. Mr. Schubert is a senior vice
president and the director of the mutual fund finance department of Mitchell
Hutchins. From August 1992 to August 1994, he was a vice president at BlackRock
Financial Management L.P. Mr. Schubert is a vice president and treasurer of 32
investment companies for which Mitchell Hutchins, PaineWebber or one of their
affiliates serves as investment adviser.
BARNEY A. TAGLIALATELA, age 38, vice president and assistant treasurer of
the Fund (appointed May 1997). Mr. Taglialatela is a vice president and a
manager of the mutual fund finance department of Mitchell Hutchins. Prior to
February 1995, he was a manager of the mutual fund finance division of Kidder
Peabody Asset Management, Inc. Mr. Taglialatela is a vice president and
assistant treasurer of 32 investment companies for which Mitchell Hutchins,
PaineWebber or one of their affiliates serves as investment adviser.
KEITH A. WELLER, age 38, vice president and assistant secretary of the Fund
(appointed September 1995). Mr. Weller is a first vice president and associate
general counsel of Mitchell Hutchins. Prior to June 1995, he was an attorney
with the law firm of Brown & Wood. Mr. Weller is a vice president and assistant
secretary of 31 investment companies for which Mitchell Hutchins, PaineWebber or
one of their affiliates serves as an investment adviser.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The Fund is not aware of any outstanding reports required to be filed
pursuant to Section 16(a) of the Securities Exchange Act of 1934.
SHAREHOLDER PROPOSALS
Any shareholder who wishes to submit proposals to be considered at the
Fund's 2001 annual meeting of shareholders should send such proposals to the
Fund at 51 West 52nd Street, New York, NY 10019-6114. In order to be considered
at that meeting, shareholder proposals must be received by the Fund no later
than August 1, 2000 and must satisfy the other requirements of the federal
securities laws.
9
<PAGE>
OTHER BUSINESS
Management knows of no business to be presented at the meeting other than
the matters set forth in this proxy statement, but should any other matter
requiring a vote of shareholders arise, the proxies will vote thereon according
to their best judgment in the interest of the Fund.
By order of the board of directors,
DIANNE E. O'DONNELL
SECRETARY
November 29, 1999
IT IS IMPORTANT THAT YOU EXECUTE AND RETURN YOUR PROXY PROMPTLY.
<PAGE>
- --------------------------------------------------------------------------------
INVESTMENT
GRADE
MUNICIPAL
INCOME FUND INC.
- --------------------------------------------------------------------------------
PROXY
STATEMENT
- --------------------------------------------------------------------------------
INVESTMENT
GRADE
MUNICIPAL
INCOME FUND INC.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NOTICE OF
ANNUAL MEETING
TO BE HELD ON
JANUARY 20, 2000
AND
PROXY STATEMENT
- --------------------------------------------------------------------------------
<PAGE>
APS
PROXY
-----
INVESTMENT GRADE MUNICIPAL INCOME FUND INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS - JANUARY 20, 2000
THE UNDERSIGNED HEREBY APPOINTS AS PROXIES SCOTT GRIFF AND VICTORIA DRAKE AND
EACH OF THEM (WITH POWER OF SUBSTITUTION) TO VOTE FOR THE UNDERSIGNED ALL SHARES
OF PREFERRED STOCK OF THE UNDERSIGNED AT THE AFORESAID MEETING AND ANY
ADJOURNMENT THEREOF WITH ALL THE POWER THE UNDERSIGNED WOULD HAVE IF PERSONALLY
PRESENT. THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS INSTRUCTED.
UNLESS INDICATED TO THE CONTRARY, THIS PROXY SHALL BE DEEMED TO GRANT AUTHORITY
TO VOTE "FOR" ALL PROPOSALS. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS OF INVESTMENT GRADE MUNICIPAL INCOME FUND INC.
YOUR VOTE IS IMPORTANT
Please date and sign this proxy on the reverse side and return it in the
enclosed envelope to PFPC Inc., P.O. Box 9426, Wilmington, DE 19809-9938. PFPC
Inc. has been engaged to forward the enclosed proxy material and to tabulate
proxies by mail.
PLEASE INDICATE YOUR VOTE BY AN `X' IN THE APPROPRIATE BOX BELOW.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FOR ALL OR FOR ALL EXCEPT OR WITHHOLD
1. ELECTION OF DIRECTORS
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST BELOW AND MARK
CENTER BOX TO RIGHT.)
Margo N. Alexander, Richard Q. Armstrong, E. Garrett Bewkes, Jr., Richard R.
Burt, Mary C. Farrell, Meyer Feldberg, George W. Gowen, Frederic V. Malek, Carl
W. Schafer, Brian M. Storms. [ ] [ ] [ ]
FOR AGAINST ABSTAIN
2. To ratify the selection of PricewaterhouseCoopers LLP as the Fund's
independent accountants for the fiscal year ending September 30, 2000. [ ] [ ] [ ]
</TABLE>
Continued and to be signed on reverse side
<PAGE>
This proxy will not be voted unless it is dated and signed exactly as
instructed below.
If shares are held by an individual, sign your name exactly as it appears on
this card. If shares are held jointly, either party may sign, but the name of
the party signing should conform exactly to the name shown on this proxy card.
If shares are held by a corporation, partnership or similar account, the name
and the capacity of the individual signing the proxy card should be indicated
unless it is reflected in the form of registration. For example: "ABC Corp.,
John Doe, Treasurer."
Sign exactly as name appears hereon.
___________________________(L.S.)
___________________________(L.S.)
Date______________________, 199__
<PAGE>
COMMON STOCK
PROXY
-----
INVESTMENT GRADE MUNICIPAL INCOME FUND INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS - JANUARY 20, 2000
THE UNDERSIGNED HEREBY APPOINTS AS PROXIES SCOTT GRIFF AND VICTORIA DRAKE AND
EACH OF THEM (WITH POWER OF SUBSTITUTION) TO VOTE FOR THE UNDERSIGNED ALL SHARES
OF COMMON STOCK OF THE UNDERSIGNED AT THE AFORESAID MEETING AND ANY ADJOURNMENT
THEREOF WITH ALL THE POWER THE UNDERSIGNED WOULD HAVE IF PERSONALLY PRESENT. THE
SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS INSTRUCTED. UNLESS INDICATED
TO THE CONTRARY, THIS PROXY SHALL BE DEEMED TO GRANT AUTHORITY TO VOTE "FOR" ALL
PROPOSALS. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
INVESTMENT GRADE MUNICIPAL INCOME FUND INC.
YOUR VOTE IS IMPORTANT
Please date and sign this proxy on the reverse side and return it in the
enclosed envelope to PFPC Inc., P.O. Box 9426, Wilmington, DE 19809-9938. PFPC
Inc. has been engaged to forward the enclosed proxy material and to tabulate
proxies by mail.
PLEASE INDICATE YOUR VOTE BY AN `X' IN THE APPROPRIATE BOX BELOW.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
FOR ALL OR FOR ALL EXCEPT OR WITHHOLD
1. ELECTION OF DIRECTORS
(INSTRUCTION: -TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST BELOW AND MARK
CENTER BOX TO RIGHT.)
Richard Q. Armstrong, E. Garrett Bewkes, Jr., Richard R. Burt, Mary C.
Farrell, George W. Gowen, Frederic V. Malek, Carl W. Schafer, Brian M.
Storms. [ ] [ ] [ ]
FOR AGAINST ABSTAIN
2. To ratify the selection of PricewaterhouseCoopers LLP as the Fund's
independent accountants for the fiscal year ending September 30, 2000. [ ] [ ] [ ]
</TABLE>
Continued and to be signed on reverse side
<PAGE>
This proxy will not be voted unless it is dated and signed exactly as
instructed below.
If shares are held by an individual, sign your name exactly as it appears on
this card. If shares are held jointly, either party may sign, but the name of
the party signing should conform exactly to the name shown on this proxy card.
If shares are held by a corporation, partnership or similar account, the name
and the capacity of the individual signing the proxy card should be indicated
unless it is reflected in the form of registration. For example: "ABC Corp.,
John Doe, Treasurer."
Sign exactly as name appears hereon.
___________________________(L.S.)
___________________________(L.S.)
Date______________________, 199__
