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Alliance Money Market Fund
This is filed pursuant to Rule 497(e).
File Nos. 033-85850 and 811-08838.
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Alliance Money Market Fund (the
"Fund") is an open-end management in-
vestment company comprised of seven
portfolios (the "Portfolios"), three
of which are offered by this Prospec-
tus, each with investment objectives
of safety, liquidity and maximum cur-
rent income (in the case of the Gen-
eral Municipal Portfolio, exempt from
Federal income taxes), to the extent
consistent with the first two objec-
tives. The Prime, Government and Gen-
eral Municipal Portfolios are diver-
sified. This Prospectus sets forth
the information about each Portfolio
that a prospective investor should
know before investing. Please retain
it for future reference. You will re-
ceive semi-annual and annual reports
of your particular Portfolio.
AN INVESTMENT IN A PORTFOLIO IS (I)
NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT; (II) NOT A DEPOSIT
OR OBLIGATION OF, OR GUARANTEED OR
ENDORSED BY, ANY BANK; AND (III) NOT
FEDERALLY INSURED BY THE FEDERAL DE-
POSIT INSURANCE CORPORATION, THE FED-
ERAL RESERVE BOARD OR ANY OTHER AGEN-
CY. THERE CAN BE NO ASSURANCE THAT A
PORTFOLIO WILL BE ABLE TO MAINTAIN A
STABLE NET ASSET VALUE OF $1.00 PER
SHARE.
A "Statement of Additional Informa-
tion" for the Fund dated April 20,
1995, which provides a further dis-
cussion of certain areas in this pro-
spectus and other matters which may
be of interest to some investors, has
been filed with the Securities and
Exchange Commission and is incorpo-
rated herein by reference. For a free
copy, write the respective portfolio
at the address shown on page 8.
THESE SECURITIES HAVE NOT BEEN AP-
PROVED OR DISAPPROVED BY THE SECURI-
TIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMIS-
SION OR ANY STATE SECURITIES COMMIS-
SION PASSED UPON THE ACCURACY OR ADE-
QUACY OF THIS PROSPECTUS. ANY REPRE-
SENTATION TO THE CONTRARY IS A CRIMI-
NAL OFFENSE.
WASHINGTON TRUST BANK [LOGO]
----------------------------
INVESTMENT SERVICES
Presents...
A Cash Management Service
with
ALLIANCE MONEY MARKET FUND
. PRIME PORTFOLIO
. GOVERNMENT PORTFOLIO
. GENERAL MUNICIPAL PORTFOLIO
Washington Trust Bank Investment Services
717 W. Sprague . Spokane, WA 99204
353-4202 or 1-800-927-0023
Prospectus
April 20, 1995
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EXPENSE INFORMATION
SHAREHOLDER TRANSACTION EXPENSES
The Portfolios have no sales load on purchases or reinvested dividends,
deferred sales load, redemption fee or exchange fee.
ESTIMATED ANNUAL PORTFOLIO OPERATING EXPENSES
(as a percentage of average net assets, after expense reimbursement)
<TABLE>
<CAPTION>
GENERAL
PRIME GOVERNMENT MUNICIPAL
----- ---------- ---------
<S> <C> <C> <C>
Management Fees.................................. .50% .50% .50%
12b-1 Fees....................................... .45 .45 .45
Other Expenses................................... .05 .05 .05
---- ---- ----
Total Portfolio Operating Expenses............... 1.00% 1.00% 1.00%
</TABLE>
EXAMPLE
You would pay the following expenses on a $1,000 investment, assuming a 5%
annual return (cumulatively through the end of each time period):
<TABLE>
<CAPTION>
1 YEAR 3 YEARS
------ -------
<S> <C> <C>
Prime......................................................... $10 $32
Government.................................................... 10 32
General Municipal............................................. 10 32
</TABLE>
The purpose of the foregoing table is to assist the investor in
understanding the various costs and expenses that an investor in a Portfolio
will bear directly or indirectly. The expenses listed in the table for the
Prime, Government and General Municipal Portfolios are net of voluntary
expense reimbursements. The expenses of such Portfolios before expense
reimbursements would be: Prime Portfolio: Management Fees--.50%, 12b-1 fees--
.45%, Other Expenses--.12% and Total Operating Expenses--1.07%; Government
Portfolio: Management Fees--.50%, 12b-1 fees--.45%, Other Expenses--.20% and
Total Operating Expenses--1.15%; General Municipal Portfolio: Management
Fees--.50%, 12b-1 fees--.45%, Other Expenses--.19% and Total Operating
Expenses--1.14%. The category "Other Expenses" is based on the estimated
amounts expected to be incurred during each Portfolio's first fiscal year. THE
EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES;
ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.
INVESTMENT OBJECTIVES AND POLICIES
The investment objectives of each Portfolio are--in the following order of
priority--safety of principal, excellent liquidity and, to the extent consis-
tent with the first two objectives, maximum current income (exempt from income
taxes to the extent described below in the case of the General Portfolio). As
a matter of fundamental policy, each Portfolio pursues its objectives by main-
taining a portfolio of high-quality money market securities. While no Portfo-
lio may change this policy or the "other fundamental investment policies" de-
scribed below without shareholder approval, it may, upon notice to sharehold-
ers, but without such approval, change non-fundamental investment policies or
create additional series or classes of shares in order to establish portfolios
which may have different investment objectives. There can be no assurance that
any Portfolio's objectives will be achieved.
The Portfolios will comply with Rule 2a-7 under the Investment Company Act
of 1940 (the "1940 Act"), as amended from time to time, including the diversi-
ty, quality and maturity limitations imposed by the Rule. Accordingly, each
Portfolio will invest in securities which, at the time of investment, have re-
maining maturities not exceeding 397 days, and the average maturity of each
Portfolio's
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investment portfolio will not exceed 90 days. A more detailed description of
Rule 2a-7 is set forth in the Fund's Statement of Additional Information.
PRIME PORTFOLIO
The money market securities in which the Prime Portfolio invests include:
(1) marketable obligations of, or guaranteed by, the United States Government,
its agencies or instrumentalities (collectively, the "U.S. Government"); (2)
certificates of deposit, bankers' acceptances and interest-bearing savings de-
posits issued of guaranteed by banks or savings and loan associations having
total assets of more than $1 billion and which are members of the Federal De-
posit Insurance Corporation and certificates of deposit and bankers' accept-
ances denominated in U.S. dollars and issued by U.S. branches of foreign banks
having total assets of at least $1 billion that are believed by Alliance Capi-
tal Management L.P. (the "Adviser") to be of quality equivalent to that of
other such instruments in which the Portfolio may invest; (3) commercial paper
of prime quality [i.e., rated A-1+ or A-1 by Standard & Poor's Corporation
("Standard & Poor's") or Prime-1 by Moody's Investors Service, Inc.
("Moody's") or, if not rated, issued by companies having outstanding debt se-
curities rated AAA or AA by Standard & Poor's, or Aaa or Aa by Moody's] and
participation interests in loans extended by banks to such companies; and (4)
repurchase agreements that are collateralized in full each day by liquid secu-
rities of the types listed above. These agreements are entered into with "pri-
mary dealers" (as designated by the Federal Reserve Bank of New York) in U.S.
Government securities or The Bank of New York, the Fund's Custodian, and would
create a loss to the Prime Portfolio if, in the event of a dealer default, the
proceeds from the sale of the collateral were less than the repurchase price.
The Prime Portfolio may also invest in certificates of deposit issued by, and
time deposits maintained at, foreign branches of domestic banks described in
(2) above and prime quality dollar-denominated commercial paper issued by for-
eign companies meeting the criteria specified in (3) above.
The Prime Portfolio also may invest in asset-backed securities that meet its
existing diversification, quality and maturity criteria. Asset-backed securi-
ties are securities issued by special purpose entities whose primary assets
consist of a pool of loans or accounts receivable. The securities may be in
the form of a beneficial interest in a special purpose trust, limited partner-
ship interest, or commercial paper or other debt securities issued by a spe-
cial purpose corporation. Although the securities may have some form of credit
or liquidity enhancement, payments on the securities depend predominately upon
collection of the loans and receivables held by the issuer.
Certain Fundamental Investment Policies. To maintain portfolio diversifica-
tion and reduce investment risk, the Prime Portfolio may not: (1) invest more
than 25% of its assets in the securities of issuers conducting their principal
business activities in any one industry although there is no such limitation
with respect to U.S. Government securities or certificates of deposit, bank-
ers' acceptances and interest bearing savings deposits; (2) invest more than
5% of its assets in securities of any one issuer (except the U.S. Government)
although with respect to one-quarter of its total assets it may invest without
regard to such limitation; (3) invest more than 5% of its assets in the secu-
rities of any issuer (except the U.S. Government) having less than three years
of continuous operation or purchase more than 10% of any class of the out-
standing securities of any issuer (except the U.S. Government); (4) borrow
money except from banks on a temporary basis or by entering into reverse re-
purchase agreements in aggregate amounts not exceeding 15% of its assets and
to facilitate the orderly maturation and sale of portfolio securities during
any periods of abnormally heavy redemption requests; or (5) mortgage, pledge
or hypothecate its assets except to secure such borrowings.
As a matter of operating policy, fundamental policy number (2) would give
the Prime Portfolio the ability to invest, with respect to 25% of its assets,
more than 5% of its assets in any one issuer only in the event Rule 2a-7 is
amended in the future.
GOVERNMENT PORTFOLIO
The securities in which the Government Portfolio invests are: (1) marketable
obligations of, or guaranteed by, the United States Government, its agencies
or instrumentalities (collectively, the "U.S. Government"), including issues
of the United States Treasury, such as bills, certificates of indebtedness,
notes and bonds, and issues of
3
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agencies and instrumentalities established under the authority of any act of
Congress; and (2) repurchase agreements that are collateralized in full each
day by the types of securities listed above. These agreements are entered into
with "primary dealers" (as designated by the Federal Reserve Bank of New York)
in U.S. Government securities or the Fund's Custodian and would create a loss
to the Government Portfolio if, in the event of a dealer default, the proceeds
from the sale of the collateral were less than the repurchase price. The Gov-
ernment Portfolio may commit up to 15% of its net assets to the purchase of
when-issued U.S. Government securities, whose value may fluctuate prior to
their settlement, thereby creating an unrealized gain or loss to the Govern-
ment Portfolio.
Certain Fundamental Investment Policies. To maintain portfolio diversifica-
tion and reduce investment risk, the Government Portfolio may not: (1) borrow
money except from banks on a temporary basis or by entering into reverse re-
purchase agreements in aggregate amounts not exceeding 10% of its assets and
to be used exclusively to facilitate the orderly maturation and sale of port-
folio securities during any periods of abnormally heavy redemption requests,
if they should occur, such borrowings may not be used to purchase investments
and it will not purchase any investment while any such borrowings exist; or
(2) pledge, hypothecate or in any manner transfer, as security for indebted-
ness, its assets except to secure such borrowings.
GENERAL MUNICIPAL PORTFOLIO
As a matter of fundamental policy, the General Municipal Portfolio, except
when assuming a temporary defensive position, must maintain at least 80% of
its total assets in high-quality municipal securities (as opposed to the tax-
able investments described below). Normally, substantially all of the General
Municipal Portfolio's income will be tax-exempt as described below. The Gen-
eral Municipal Portfolio seeks maximum current income that is exempt from Fed-
eral income taxes by investing principally in a diversified portfolio of high-
quality municipal securities. Such income may be subject to state or local in-
come taxes.
Alternative Minimum Tax. The General Municipal Portfolio may invest without
limitation in tax-exempt municipal securities subject to the Federal alterna-
tive minimum tax (the "AMT").
Under current Federal income tax law, (1) interest on tax-exempt municipal
securities issued after August 7, 1986 which are "specified private activity
bonds," and the proportionate share of any exempt-interest dividends paid by a
regulated investment company which receives interest from such specified pri-
vate activity bonds, will be treated as an item of tax preference for purposes
of the AMT imposed on individuals and corporations, though for regular Federal
income tax purposes such interest will remain fully tax-exempt, and (2) inter-
est on all tax-exempt obligations will be included in "adjusted current earn-
ings" of corporations for AMT purposes. Such bonds have provided, and may con-
tinue to provide, somewhat higher yields than other comparable municipal secu-
rities. See below, "Daily Dividends and Other Distributions" and "Taxes."
Municipal Securities. The municipal securities in which the General Munici-
pal Portfolio invests include municipal notes and short-term municipal bonds.
Municipal notes are generally used to provide for short-term capital needs and
generally have maturities of one year or less. Examples include tax anticipa-
tion and revenue anticipation notes which are generally issued in anticipation
of various seasonal revenues, bond anticipation notes, and tax-exempt commer-
cial paper. Short-term municipal bonds may include general obligation bonds,
which are secured by the issuer's pledge of its faith, credit and taxing power
for payment of principal and interest, and revenue bonds, which are generally
paid from the revenues of a particular facility or a specific excise or other
source.
The General Municipal Portfolio may invest in variable rate obligations
whose interest rates are adjusted either at predesignated periodic intervals
or whenever there is a change in the market rate to which the security's in-
terest rate is tied. Such adjustments tend to minimize changes in the market
value of the obligation and, accordingly, enhance the ability of the Portfolio
to maintain a stable net asset value. Variable rate securities purchased may
include participation interests in industrial development bonds backed by let-
ters of credit of Federal Deposit Insurance Corporation member banks having
total assets of more than $1 billion. The letters of credit of any single bank
in respect of all variable rate obligations will not cover more than 10% of
the General Municipal Portfolio's total assets.
4
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Each of the General Municipal Portfolio's municipal securities at the time
of purchase are rated within the two highest quality ratings of Moody's (Aaa
and Aa, MIG 1 and MIG 2 or VMIG 1 and VMIG 2) or Standard & Poor's (AAA and AA
or SP-1 and SP-2), or judged by the Adviser to be of comparable quality. Secu-
rities must also meet credit standards applied by the Adviser.
The General Municipal Portfolio also may invest in stand-by commitments,
which may involve certain expenses and risks, but such commitments are not ex-
pected to comprise more than 5% of the Portfolio's net assets. The General Mu-
nicipal Portfolio may commit up to 15% of its net assets to the purchase of
when-issued securities. The Fund's Custodian will maintain, in a separate ac-
count of the General Municipal Portfolio, liquid high grade debt securities
having value equal to, or greater than, such commitments. The price of when-
issued securities, which is generally expressed in yield terms, is fixed at
the time the commitment to purchase is made, but delivery and payment for such
securities takes place at a later time. Normally the settlement date occurs
from within ten days to one month after the purchase of the issue. The value
of when-issued securities may fluctuate prior to their settlement, thereby
creating an unrealized gain or loss to the General Municipal Portfolio.
Taxable investments. The taxable investments in which the General Municipal
Portfolio may invest include obligations of the U.S. Government and its agen-
cies, high-quality certificates of deposit and bankers' acceptances, prime
commercial paper and repurchase agreements.
Certain Fundamental Investment Policies. To reduce investment risk, the Gen-
eral Municipal Portfolio may not invest more than 25% of its total assets in
municipal securities whose issuers are located in the same state and may not:
(1) invest more than 25% of its total assets in municipal securities the in-
terest upon which is paid from revenues of similar-type projects; (2) invest
more than 5% of its total assets in the securities of any one issuer except
the U.S. Government, although with respect to 25% of its total assets the Gen-
eral Municipal Portfolio may invest up to 10% per issuer; or (3) purchase more
than 10% of any class of the voting securities of any one issuer except those
of the U.S. Government.
POLICIES APPLICABLE TO EACH PORTFOLIO
No Portfolio will maintain more than 10% of its net assets in illiquid secu-
rities which include "restricted securities" subject to legal restrictions on
resale arising from an issuer's reliance upon certain exemptions from regis-
tration under the Securities Act of 1993, as amended (the "Securities Act").
Each Portfolio may purchase restricted securities determined by the Adviser to
be liquid in accordance with procedures adopted by the Trustees of the Fund,
including securities eligible for resale under Rule 144A under the Securities
Act and commercial paper issued in reliance upon the exemption from registra-
tion in Section 4(2) of the Securities Act.
PURCHASE AND REDEMPTION OF SHARES
OPENING ACCOUNTS
Instruct your Investment Officer to open an Alliance Money Market Fund Prime
Portfolio, Government Portfolio or General Municipal Portfolio account in con-
nection with your Investment Services account. The minimum initial investment
is $1,000.
SUBSEQUENT INVESTMENTS
A. BY CHECK OR DRAFT
Send your check or negotiable draft for $100 or more to Investment Services.
Please make your check payable to Washington Trust Bank (WTB) and indicate
your Investment Services account number on your check or draft.
B. AUTOMATIC SWEEP
Washington Trust Bank has available a sweep which automatically links a Fund
to a Customer's Investment Services account. If you elect the sweep arrange-
ment, Washington Trust Bank will sweep into your account all cash balances of
$100 or more on a daily basis. Balances under $100 are swept weekly.
C. BY TELEPHONES
Customers may transfer amounts of $100 or more from their Washington Trust
Bank Checking or Savings account to their Fund account by calling Investment
Services. Additionally, cash that has come into your Investment Services ac-
count from proceeds of sales or any other
5
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source can be moved into your Fund account by calling Investment Services each
time you know there is a cash balance.
REDEMPTIONS
A. BY CHECK-WRITING
You may order check-writing for your Fund account simply by completing a
Signature Card and returning it to Investment Services. Although checks may be
made payable to any payee, they must be written for amounts of $100 or more.
Checks cannot be written for more than the principal balance (not including
any accrued dividends) in your account. There is no charge for check-writing.
B. BY AUTOMATIC SWEEP
If you elect the sweep arrangement, money will automatically be transferred
from your Fund account whenever a debit balance is created in your Investment
Services account. In the case of purchases, the automatic transfer will occur
on settlement date.
C. BY TELEPHONE
Customers may transfer amounts of $100 or more from their Fund account to
their Washington Trust Bank Checking or Savings account by calling Investment
Services. Alternatively, you may instruct Investment Services to make payment
to you with a Washington Trust Bank Check.
ADDITIONAL INFORMATION
SHARE PRICE
Shares are sold and redeemed on a continuous basis without sales or redemp-
tion charges at their net asset value which is expected to be constant at
$1.00 per share, although this price is not guaranteed. The net asset value of
each Portfolio's shares is determined each business day (i.e., any weekday ex-
clusive of days on which the New York Stock Exchange or The Bank of New York
is closed) at 12:00 Noon and 4:00 p.m. (New York time). The net asset value
per share of a Portfolio is calculated by taking the sum of the value of that
Portfolio's investments (amortized cost value is used for this purpose) and
any cash or other assets, subtracting liabilities, and dividing by the total
number of shares of that Portfolio outstanding. All expenses, including the
fees payable to the Adviser, are accrued daily.
TIMING OF INVESTMENTS AND REDEMPTIONS
The Portfolios have two transaction times each business day, 12:00 Noon and
4:00 p.m. (New York time). New investments represented by Federal funds or
bank wire monies received by The Bank of New York at any time during a day
prior to 4:00 p.m. are entitled to the full dividend to be paid to sharehold-
ers for that day. Shares do not earn dividends on the day a redemption is ef-
fected regardless of whether the redemption order is received before or after
12:00 Noon.
Redemption proceeds are normally wired or mailed either the same or the next
business day, but in no event later than seven days, unless redemptions have
been suspended or postponed due to the determination of an "emergency" by the
Securities and Exchange Commission or to certain other unusual conditions.
DAILY DIVIDENDS AND OTHER DISTRIBUTIONS
All net income of each Portfolio is determined each business day at 4:00
p.m. and is paid immediately thereafter pro rata to shareholders of record of
that Portfolio via automatic investment in additional full and fractional
shares of that Portfolio in each shareholder's account. As such additional
shares are entitled to dividends on following days, a compounding growth of
income occurs.
Net income consists of all accrued interest income on a Portfolio's assets
less the Portfolio's expenses applicable to that dividend period. Realized
gains and losses of each Portfolio are reflected in its net asset value and
are not included in its net income.
TAXES
A prospective investor should review the more detailed discussion of Federal
income tax considerations relevant to each Portfolio that is contained in the
Statement of Additional Information. In addition, each prospective investor
should consult with his/her own tax advisers as to the tax consequences of an
investment in the Portfolio, including the status of distributions from a
Portfolio in
6
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his/her own state and locality and the possible applicability of the AMT to a
portion of the distributions of the General Municipal Portfolio.
The Fund intends to qualify each Portfolio each year as a separate "regu-
lated investment company" and as such, each Portfolio will not be subject to
Federal income and excise taxes on the investment company taxable income and
net capital gains, if any, distributed to shareholders.
PRIME PORTFOLIO AND GOVERNMENT PORTFOLIO. Shareholders of the Prime Portfo-
lio and Government Portfolio (other than tax-exempt shareholders) will be sub-
ject to Federal income tax on the ordinary income dividends and any capital
gains dividends from these Portfolios and may also be subject to state and lo-
cal taxes. The laws of some states and localities, however, may exempt from
some taxes dividends paid on shares of the Prime Portfolio and Government
Portfolio, which are dividends attributable to interest from obligations of
the U.S. Government and certain of its agencies and instrumentalities.
DISTRIBUTIONS FORM THE GENERAL MUNICIPAL PORTFOLIO. Distributions to you out
of tax-exempt interest income earned by the General Municipal Portfolio are
not subject to Federal income tax (other than the AMT), but may be subject to
state or local income taxes. Any exempt-interest dividends derived form inter-
est on municipal securities subject to the AMT will be a specific preference
item for purposes of the Federal individual and corporate AMT. Distributions
from the General Municipal Portfolio to a corporate shareholder are not exempt
from the corporate taxes imposed by the respective jurisdictions. Distribu-
tions out of taxable interest income, other investment income and short-term
capital gains are taxable to you as ordinary income and distributions of long-
term capital gains, if any, are taxable as long-term taxable gains irrespec-
tive of the length of time you may have held your shares. Distributions of
short and long-term capital gains, if any, are normally made near year-end.
Each year shortly after December 31, the Fund will send to you tax information
stating the amount and type of all its distributions of the year just ended.
GENERAL. Distributions to shareholders will be treated in the same manner
for Federal income tax purposes whether received in cash or reinvested in ad-
ditional shares of a Portfolio. In general, distributions by a Portfolio are
taken into account by shareholders in the year in which they are made. Howev-
er, certain distributions made during January will be treated as having been
paid by a Portfolio and received by the shareholders on December 31 of the
preceding year. A statement setting forth the Federal income tax status of all
distributions made (or deemed made) during the calendar year, including any
portions which constitute ordinary income dividends, capital gains dividends
and exempt-interest dividends and U.S. Government interest dividends will be
sent to each shareholder of a Portfolio promptly after the end of each calen-
dar year.
MANAGEMENT OF THE FUND
ADVISER
Alliance Capital Management L.P., a New York Stock Exchange listed company
with principal offices at 1345 Avenue of the Americas, New York, New York
10105, has been retained by the Fund, on behalf of each Portfolio, under an
investment advisory agreement (the "Advisory Agreement") to provide investment
advice and, in general, to conduct the management and investment program of
the Fund under the supervision and control of the Fund's Trustees.
Alliance Capital Management Corporation, the sole general partner of, and
the owner of a 1% general partnership interest in, the Adviser is an indirect
wholly-owned subsidiary of The Equitable Life Assurance Society of the United
States ("Equitable"), one of the largest life insurance companies in the
United States and a wholly-owned subsidiary of The Equitable Companies Incor-
porated, a holding company controlled by AXA, a French insurance holding com-
pany. Certain information concerning the ownership and control of Equitable by
AXA is set forth in the Statement of Additional Information under "Management
of the Fund."
Under its Advisory Agreement with the Fund, the Adviser provides investment
advisory services and order
7
<PAGE>
placement facilities for the Fund. Under the Advisory Agreement, each Portfo-
lio pays the Adviser a fee at the annual rate of .50% of a Portfolio's average
daily net assets. The Adviser may, from time to time, voluntarily waive a por-
tion of its advisory fees payable from one or more of the Portfolios.
In addition to the payments to the Adviser under the Advisory Agreement de-
scribed above, the Fund may pay certain other costs, including (i) custody,
transfer and dividend disbursing expenses, (ii) fees of the Trustees who are
not affiliated persons, (iii) legal and auditing expenses, (iv) clerical, ac-
counting, administrative and other office costs, (v) costs of personnel pro-
viding services to the Fund, as applicable, (vi) costs of printing prospec-
tuses and shareholder reports, (vii) expenses and fees related to registration
and filing with the Securities and Exchange Commission and with state regula-
tory authorities and (viii) such promotional expenses as may be contemplated
by an effective plan pursuant to Rule 12b-1 under the 1940 Act.
Under a Distribution Services Agreement (the "Agreement"), each Portfolio
pays the Adviser at a maximum annual rate of .45 of 1% of the Portfolio's ag-
gregate average daily net assets. Substantially all such monies (together with
significant amounts from the Adviser's own resources) are paid by the Adviser
to broker-dealers and other financial intermediaries for their distribution
assistance and to banks and other depository institutions for administrative
and accounting services provided to the Portfolios, with any remaining amounts
being used to partially defray other expenses incurred by the Adviser in dis-
tributing the Portfolios' shares. The Fund believes that the administrative
services provided by depository institutions are permissible activities under
present banking laws and regulations and will take appropriate actions (which
should not adversely affect the Portfolios or their shareholders) in the fu-
ture to maintain such legal conformity should any changes in, or interpreta-
tions of, such laws or regulations occur.
ADMINISTRATOR
Pursuant to an Administration Agreement, ADP Financial Information Services,
Inc., a wholly-owned subsidiary of Automatic Data Processing, Inc., serves as
administrator of the Fund, on behalf of the Portfolios. The Administrator per-
forms or arranges for the performance of certain services, mainly remote
processing services through its propriety shareholder accounting system. ADP
is entitled to receive from each Portfolio a fee computed daily and paid
monthly at a maximum annual rate equal to .05% of such Portfolio's average
daily net assets. ADP may, from time to time, voluntarily waive all or a por-
tion of its fees payable to it under the Administration Agreement. ADP shall
not have any responsibility or authority for any Portfolio's investments, the
determination of investment policy, or for any matter pertaining to the dis-
tribution of Portfolio shares.
TRANSFER AGENT AND DISTRIBUTOR
Alliance Fund Services, Inc., P.O. Box 1520, Secaucus, NJ 07096-1520 and Al-
liance Fund Distributors, Inc., 1345 Avenue of the Americas, New York, N.Y.
10105, are the Fund's Transfer Agent and Distributor, respectively.
ORGANIZATION
Each of the Portfolios is a series of Alliance Money Market Fund, an open-
end management investment company registered under the 1940 Act and organized
as a Massachusetts business trust on October 26, 1994. The New Jersey, New
York, California and Connecticut Municipal Portfolios are non-diversified se-
ries of the Fund and are not offered by this Prospectus. Each Portfolio's ac-
tivities are supervised by the Trustees of the Fund. Normally, shares of each
series are entitled to one vote per share, and vote as a single series, on
matters that affect each series in substantially the same manner. Massachu-
setts law does not require annual meetings of shareholders and it is antici-
pated that shareholder meetings will be held only when required by Federal
law. Shareholders have available certain procedures for the removal of Trust-
ees.
8
