This is filed pursuant to Rule 497(e).
File Nos.: 33-85850 and 811-08838
Alliance Money Market Fund (the "Fund") is an open-end management investment
company comprised of seven portfolios, one of which, the General Municipal
Portfolio (the "Portfolio") is offered by this Prospectus. The Portfolio's
investment objectives are safety, liquidity and maximum current income that is
exempt from Federal income taxes to the extent consistent with the first two
objectives. The Portfolio is diversified. This Prospectus sets forth the
information about the Portfolio that a prospective investor should know before
investing. Please retain it for future reference. You will receive semi-annual
and annual reports of the Portfolio.
AN INVESTMENT IN THE 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 DEPOSIT INSURANCE
CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER AGENCY. THERE CAN BE NO
ASSURANCE THAT THE PORTFOLIO WILL BE ABLE TO MAINTAIN A STABLE NET ASSET VALUE
OF $1.00 PER SHARE.
A "Statement of Additional Information" for the Portfolio dated April 1, 1998,
which provides a further discussion of certain areas in this Prospectus and
other matters which may be of interest to some investors, has been filed with
the Securities and Exchange Commission and is incorporated herein by reference.
For a free copy, contact your Investment Executive.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
WAYNE HUMMER INVESTMENTS LLC
INTRODUCES...
ALLIANCE MONEY MARKET FUND
GENERAL MUNICIPAL PORTFOLIO
PROSPECTUS
APRIL 1, 1998
WAYNE HUMMER INVESTMENTS LLC
300 SOUTH WACKER DRIVE
CHICAGO, ILLINOIS 60606
EXPENSE INFORMATION
_______________________________________________________________________________
SHAREHOLDER TRANSACTION EXPENSES
The Portfolio has no sales load on purchases or reinvested dividends, deferred
sales load, redemption fee or exchange fee.
ANNUAL PORTFOLIO OPERATING EXPENSES
(as a percentage of average net assets, after voluntary expense reimbursement)
GENERAL
MUNICIPAL
---------
Management Fees .50%
12b-1 Fees .45%
Other Expenses .05%
Total Portfolio Operating Expenses 1.00%
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):
1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------- -------- -------- --------
General Municipal $10 $32 $55 $122
The purpose of the foregoing table is to assist the investor in understanding
the various costs and expenses that an investor in the Portfolio will bear
directly or indirectly. The expenses listed in the table for the Portfolio are
net of voluntary expense reimbursements. The expenses before expense
reimbursements would be: Management Fees-.50%, 12b-1 fees-.45%, Other
Expenses-.26% and Total Operating Expenses-1.21%. THE EXAMPLE SHOULD NOT BE
CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES; ACTUAL EXPENSES MAY BE
GREATER OR LESS THAN THOSE SHOWN.
FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD (AUDITED)
_______________________________________________________________________________
The following table has been audited by McGladrey & Pullen LLP, the Fund's
independent auditors, whose report thereon appears in the Statement of
Additional Information. This information should be read in conjunction with the
financial statements and notes thereto included in the Statement of Additional
Information.
GENERAL MUNICIPAL
PORTFOLIO
------------------------------
DECEMBER 13,
1995(A)
YEAR ENDED TO
NOVEMBER 30, NOVEMBER 30,
1997 1996
----------- -------------
Net asset value, beginning of period $1.00 $1.00
INCOME FROM INVESTMENT OPERATIONS
Net investment income (b) .029 .027
LESS: DIVIDENDS
Dividends from net investment income (.029) (.027)
Net asset value, end of period $1.00 $1.00
TOTAL RETURN
Total investment return based on:
net asset value (c) 2.92% 2.80%(d)
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in millions) $137 $123
Ratio to average net assets of:
Expenses, net of waivers and reimbursements 1.00% 1.00%(d)
Expenses, before waivers and reimbursements 1.21% 1.39%(d)
Net investment income (b) 2.87% 2.76%(d)
(a) Commencement of operations.
(b) Net of expenses reimbursed or waived by the Adviser.
(c) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of period.
(d) Annualized.
From time to time the Portfolio advertises its "yield" and "effective yield."
Both yield figures are based on historical earnings and are not intended to
indicate future performance. To calculate the "yield," the amount of dividends
paid on a share during a specified seven-day period is assumed to be paid each
week over a 52-week period and is shown as a percentage of the investment. To
calculate "effective yield," which will be higher than the "yield" because of
compounding,
2
the dividends paid are assumed to be reinvested. Dividends for the Portfolio
for the seven days ended November 30, 1997, amounted to an annualized yield of
3.06%, equivalent to an effective yield of 3.11%. Absent expense reimbursement,
the annualized yield for this period would have been 2.85%, equivalent to an
effective yield of 2.90%.
INVESTMENT OBJECTIVES AND POLICIES
_______________________________________________________________________________
The investment objectives of the Portfolio are--in the following order of
priority--safety of principal, excellent liquidity and, to the extent
consistent with the first two objectives, maximum current income that is exempt
from income taxes to the extent described below. As a matter of fundamental
policy, the Portfolio pursues its objectives by maintaining a portfolio of
high-quality money market securities. While the Portfolio may not change this
policy or the other fundamental investment policies (described below) without
shareholder approval, it may, upon notice to shareholders, 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 the Portfolio's
objectives will be achieved.
The Portfolio will comply with Rule 2a-7 under the Investment Company Act of
1940 (the "1940 Act"), as amended from time to time, including the
diversification, quality and maturity limitations imposed by the Rule.
Accordingly, the Portfolio will invest in securities which, at the time of
investment, have remaining maturities not exceeding 397 days, and the average
maturity of the Portfolio's investment portfolio will not exceed 90 days. A
more detailed description of Rule 2a-7 is set forth in the Portfolio's
Statement of Additional Information. To the extent that the Portfolio's
limitations are more permissive than Rule 2a-7, the Portfolio will comply with
the more restrictive provisions of the Rule.
As a matter of fundamental policy, the Portfolio, except when assuming a
temporary defensive position, must maintain at least 80% of its total assets in
highquality municipal securities (as opposed to the taxable investments
described below). Normally, substantially all of the Portfolio's income will be
tax-exempt as described below. The Portfolio seeks maximum current income that
is exempt from Federal income taxes by investing principally in a diversified
portfolio of high-quality municipal securities. Such income may be subject to
state or local income taxes.
ALTERNATIVE MINIMUM TAX. The Portfolio may invest without limitation in
tax-exempt municipal securities subject to the Federal alternative 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
private 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)
interest on all tax-exempt obligations will be included in "adjusted current
earnings" of corporations for AMT purposes. Such bonds have provided, and may
continue to provide, somewhat higher yields than other comparable municipal
securities. See below, "Daily Dividends and Other Distributions" and "Taxes."
MUNICIPAL SECURITIES. The municipal securities in which the 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 anticipation and revenue
anticipation notes which are generally issued in anticipation of various
seasonal revenues, bond anticipation notes, and tax-exempt commercial 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 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 interest rate is tied. Such
adjustments tend to minimize changes in the market value of the obligation and,
accordingly, enhance the ability of
3
the Portfolio to maintain a stable net asset value. Variable rate securities
purchased may include participation interests in industrial development bonds
backed by letters of credit of Federal Deposit Insurance Corporation member
banks having total assets of more than $1 billion. The Portfolio will comply
with Rule 2a-7 with respect to its investments in variable rate obligations
supported by letters of credit.
Each of the Portfolio's municipal securities at the time of purchase is 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. Securities must also meet
credit standards applied by the Adviser.
To further enhance the quality and liquidity of the securities in which the
Portfolio invests, such securities frequently are supported by credit and
liquidity enhancements, such as letters of credit, from third party financial
institutions. The Portfolio continuously monitors the credit quality of such
third parties; however, changes in the credit quality of such a financial
institution could cause the Portfolio's investments backed by that institution
to lose value and affect the Portfolio's share price.
The Portfolio also may invest in stand-by commitments, which may involve
certain expenses and risks, but such commitments are not expected to comprise
more than 5% of the Portfolio's net assets. The Portfolio may commit up to 15%
of its net assets to the purchase of when-issued securities. The Portfolio's
Custodian will maintain, in a separate account of the 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 Portfolio.
TAXABLE INVESTMENTS. The taxable investments in which the Portfolio may invest
include obligations of the U.S. Government and its agencies, high-quality
certificates of deposit and bankers' acceptances, prime commercial paper and
repurchase agreements.
CERTAIN FUNDAMENTAL INVESTMENT POLICIES. To reduce investment risk, the
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 interest 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 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.
As a matter of operating policy, effective July 1, 1998, pursuant to Rule 2a-7,
the Portfolio may invest no more than 5% of its assets in the securities of any
one issuer (as determined pursuant to such Rule). Fundamental policy number (2)
would give the 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 further amended in the future.
The Fund will not maintain more than 10% of its net assets in illiquid
securities, which include "restricted securities" subject to legal restrictions
on resale arising from an issuer's reliance upon certain exemptions from
registration under the Securities Act of 1933, as amended (the "Securities
Act"), other than restricted securities determined by the Adviser to be liquid
in accordance with procedures adopted by the Trustees of the Fund, such as
securities eligible for resale under Rule 144A under the Securities Act and
commercial paper issued in reliance upon the exemption from registration in
Section 4(2) of the Securities Act.
4
PURCHASE AND REDEMPTION OF SHARES
_______________________________________________________________________________
OPENING ACCOUNTS
Contact your Investment Executive to use Alliance Money Market Fund--General
Municipal Portfolio in conjunction with your brokerage account. There is a
minimum initial purchase of $500.
SUBSEQUENT INVESTMENTS
BY CHECK. Mail or deliver your check payable to Wayne Hummer Investments LLC
to your Investment Executive who will deposit it into the Portfolio. Please
indicate your brokerage account number on the check or draft.
BY SWEEP. Wayne Hummer Investments LLC has an automatic "sweep" available for
shareholders in the Portfolio. All cash balances in your brokerage account in
excess of $100 but less than $500 will be "swept" into the Portfolio on a
weekly basis. However, when the daily balance of your brokerage account exceeds
$500, all of the funds in your brokerage account will be "swept" daily into the
Portfolio.
REDEMPTIONS
BY CONTACTING YOUR INVESTMENT EXECUTIVE. Instruct your Investment Executive to
order a withdrawal from your Money Market account and issue a check made
payable to you.
BY SWEEP. Wayne Hummer Investments LLC's automatic "sweep" moves money from
your money market account automatically to cover security purchases into your
brokerage account.
BY CHECKWRITING. With this service, you may write checks made payable to any
payee in any amount of $500 or more. Checks cannot be written for more than the
principal balance (not including any accrued dividends) in your account. First
you must fill out the Signature Card which you can obtain from your Investment
Executive. There is no separate charge for the check-writing service and your
checks are provided free of charge. THE CHECK-WRITING SERVICE ENABLES YOU TO
RECEIVE THE DAILY DIVIDENDS DECLARED ON THE SHARES TO BE REDEEMED UNTIL THE DAY
THAT YOUR CHECK IS PRESENTED FOR PAYMENT.
ADDITIONAL INFORMATION
_______________________________________________________________________________
SHARE PRICE
Shares are sold and redeemed on a continuous basis without sales or redemption
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 the
Portfolio's shares is determined each business day (i.e., any weekday exclusive
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
the Portfolio is calculated by taking the sum of the value of the 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 the Portfolio outstanding. All expenses, including the fees payable
to the Adviser, are accrued daily.
TIMING OF INVESTMENTS AND REDEMPTIONS
The Portfolio has 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 shareholders for that day.
Shares do not earn dividends on the day a redemption is effected 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.
5
DAILY DIVIDENDS AND OTHER DISTRIBUTIONS
All net income of the Portfolio is determined each business day at 4:00 p.m.
and is paid immediately thereafter pro rata to shareholders of record of the
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 the Portfolio's assets
less the Portfolio's expenses applicable to that dividend period. Realized
gains and losses of the Fund 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 the 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 the
Portfolio in his/her own state and locality and the possible applicability of
the AMT to a portion of the distributions of the Portfolio.
The Portfolio intends to qualify each year as a separate "regulated investment
company" and as such, the 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.
DISTRIBUTIONS FROM THE PORTFOLIO. Distributions to you out of tax-exempt
interest income earned by the 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 from interest 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 Portfolio to a corporate
shareholder are not exempt from the corporate taxes imposed by the respective
jurisdictions. Distributions 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 irrespective 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 for 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
additional shares of the Portfolio. In general, distributions by the Portfolio
are taken into account by shareholders in the year in which they are made.
However, certain distributions made during January will be treated as having
been paid by the 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 the Portfolio promptly after the end of each
calendar year.
YEAR 2000. Many computer software systems in use today cannot properly process
date-related information from and after January 1, 2000. Should any of the
computer systems employed by the Portfolio's major service providers fail to
process this type of information properly, that could have a negative impact on
the Portfolio's operations and the services that are provided to the
Portfolio's shareholders. The Portfolio's Adviser, Alliance Fund Distributors,
Inc. ("AFD"), the Portfolio's distributor, and Alliance Fund Services, Inc.
("AFS"), the Portfolio's transfer agent have advised the Fund that they are
reviewing all of their computer systems with the goal of modifying or replacing
such systems prior to January 1, 2000 to the extent necessary to foreclose any
such negative impact. In addition, the Adviser has been advised by the
Portfolio's custodian that it is also in the process of reviewing its systems
with the same goal. As of the date of this Prospectus, the Portfolio and the
Adviser have no reason to believe that these goals will not be achieved.
Similarly, the values of certain of the portfolio securities held by the
Portfolio may be adversely affected by the inability of the securities' issuers
or of third parties to process this type of information properly.
6
MANAGEMENT OF THE FUND
_______________________________________________________________________________
ADVISER
Alliance Capital Management L.P., which is a Delaware limited partnership with
principal offices at 1345 Avenue of the Americas, New York, New York 10105, has
been retained by the Fund, on behalf of the 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 general supervision and control of the Fund's Trustees.
The Adviser is a leading international investment manager supervising client
accounts with assets as of December 31, 1997 totaling more than $218 billion
(of which approximately $85 billion represented the assets of investment
companies). The Adviser's clients are primarily major corporate employee
benefit plans, public employee retirement systems, investment companies,
foundations and endowment funds. The 58 registered investment companies managed
by the Adviser comprising 122 separate investment portfolios currently have
over three million shareholder accounts. As of December 31, 1997, the Adviser
was retained as an investment manager for employee benefit plan assets of 31 of
the Fortune 100 companies.
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, which is a wholly-owned subsidiary of The Equitable Companies
Incorporated, a holding company controlled by AXA-UAP, a French insurance
holding company. Certain information concerning the ownership and control of
Equitable by AXA-UAP 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 placement facilities for the Fund. For the fiscal
year ended November 30, 1997, the Portfolio paid the Adviser an advisory fee at
an annual rate of .32 of 1% of the average daily value of the net assets of the
Portfolio net of voluntary expense reimbursements for expenses exceeding 1% of
the average daily value of the net assets of the Portfolio.
In addition to the payments to the Adviser under the Advisory Agreement
described 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,
accounting, administrative and other office costs, (v) costs of personnel
providing services to the Fund, as applicable, (vi) costs of printing
prospectuses and shareholder reports, (vii) expenses and fees related to
registration and filing with the Securities and Exchange Commission and with
state regulatory 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"), the Portfolio pays
AFD at a maximum annual rate of .45 of 1% of the Portfolio's aggregate average
daily net assets. For the fiscal year ended November 30, 1997, the Portfolio
paid a distribution fee at an annual rate of .45% of the average daily value of
the net assets of the Portfolio. Substantially all such monies (together with
significant amounts from the Adviser's own resources) are paid by AFD 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 Portfolio, with any remaining amounts
being used to partially defray other expenses incurred in distributing the
Portfolio's shares. The Portfolio 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 future to
maintain such legal conformity should any changes in, or interpretations of,
such laws or regulations occur.
ADMINISTRATOR
Pursuant to an Administration Agreement, ADP Financial Information Services,
Inc. ("ADP"), a wholly-owned subsidiary of Automatic Data Processing, Inc.,
serves as administrator of the Fund, on behalf of the Portfolios. The
Administrator performs or arranges for the performance of certain services,
mainly remote processing services through its propriety shareholder accounting
system. ADP is entitled to receive from the Portfolio a fee
7
computed daily and paid monthly at a maximum annual rate equal to .05% of the
Portfolio's average daily net assets. ADP may, from time to time, voluntarily
waive all or a portion of its fees payable to it under the Administration
Agreement. ADP does not have any responsibility or authority for the
Portfolio's investments, the determination of investment policy, or for any
matter pertaining to the distribution of Portfolio shares.
TRANSFER AGENT AND DISTRIBUTOR
Alliance Fund Services, Inc., P.O. Box 1520, Secaucus, NJ 07096-1520 and
Alliance Fund Distributors, Inc., 1345 Avenue of the Americas, New York, NY
10105, are the Fund's Transfer Agent and Distributor, respectively.
ORGANIZATION
Alliance Money Market Fund (the "Trust") is an open-end management investment
company registered under the 1940 Act and organized as a Massachusetts business
trust on October 26, 1994. The Trust's activities are supervised by the
Trustees of the Fund. Normally, shares of each series of the Trust are entitled
to one vote per share, and vote as a single series, on matters that affect each
series in substantially the same manner. Massachusetts law does not require
annual meetings of shareholders and it is anticipated that shareholder meetings
will be held only when required by Federal law. Shareholders have available
certain procedures for the removal of Trustees.
8
