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
[ ] Confidential, for Use of the
Commission Only (as permitted
by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule
14a-12
Insured Municipal Income Fund Inc.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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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):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[_] Fee paid previously with preliminary materials:
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[_] 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:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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INSURED MUNICIPAL INCOME FUND INC.
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NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS
JULY 15, 2004
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TO THE SHAREHOLDERS:
The annual meeting of shareholders of Insured Municipal Income Fund Inc.
(the "Fund") will be held on July 15, 2004 at 10:00 a.m., Eastern time, at 51
West 52nd Street, 16th Floor, New York, New York 10019-6114 for the following
purposes:
MATTERS TO BE VOTED UPON BY ALL SHAREHOLDERS:
(1) To elect five (5) directors to serve until the annual meeting of
shareholders in 2005, or until their successors are elected and qualified
or until they resign or are otherwise removed; and
(2) 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:
(3) To elect two (2) directors to serve until the annual meeting of
shareholders in 2005, or until their successors are elected and qualified
or until they resign or are otherwise removed.
You are entitled to vote at the meeting and any adjournments thereof if
you owned Fund shares at the close of business on May 21, 2004. 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,
AMY R. DOBERMAN
SECRETARY
May 28, 2004
51 West 52nd Street
New York, New York 10019-6114
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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 POSTAGE PAID 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.
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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:
REGISTRATION VALID SIGNATURE
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Corporate Accounts
(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
INSURED 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 JULY 15, 2004
This proxy statement is furnished to the shareholders of Insured Municipal
Income Fund Inc. (the "Fund") in connection with the board of directors'
solicitation of proxies to be used at the annual meeting of the shareholders of
the Fund to be held on July 15, 2004, at 10:00 a.m., Eastern time, at 51 West
52nd Street, 16th Floor, New York, New York 10019-6114, or any adjournment or
adjournments thereof. This proxy statement and the related proxy card will first
be mailed to shareholders on or about May 28, 2004.
A majority of the shares outstanding on May 21, 2004, 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 solely by the APS), or if
such 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 marked WITHHOLD on 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 Proposals 1 and 3, for which the required vote is a
plurality of the votes cast on the matter.
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 3, 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 by 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 seven nominees for director
named herein and, in the proxies' discretion, either FOR or AGAINST any other
business that may properly arise at the annual meeting. With respect to the
holders of the Fund's common stock, if you give no voting instructions, your
shares will be voted FOR the five nominees for director named herein for which
the holders of the common stock are entitled to vote and, in the proxies'
discretion, either FOR or AGAINST any other business that may properly arise at
the annual meeting. You may revoke any proxy card by giving another proxy or by
submitting a written notice of revocation to the Fund's Secretary at 51 West
52nd Street, New York, New York 10019-6114. 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, May 21, 2004, the Fund had outstanding 20,628,363
shares of common stock and 4,200 shares of the APS, representing Series A,
Series B, Series C, Series D, Series E and Series F 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 and oral communications by regular employees
of UBS Global Asset Management (US) Inc. ("UBS Global AM") or UBS Financial
Services Inc., who will not receive any compensation therefor from the Fund.
UBS Global AM serves as the Fund's investment advisor and administrator.
UBS Global AM is an indirect wholly owned asset management subsidiary of UBS AG.
UBS AG is an internationally diversified organization with headquarters in
Zurich, Switzerland. UBS AG operates in many areas of the financial services
industry. The principal business offices of UBS Global AM are located at 51 West
52nd Street, New York, New York 10019-6114. The principal business address of
UBS AG is Bahnhofstrasse 45, Zurich, Switzerland.
The Fund's annual report containing financial statements for the fiscal
year ended March 31, 2004 is being mailed to shareholders concurrently with this
proxy statement.
PROPOSALS 1 AND 3. ELECTION OF DIRECTORS
Proposals 1 and 3 relate to the election of directors of the Fund.
Management proposes the election of the seven nominees named in the table below.
Each nominee 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, or until he
or she resigns or is otherwise removed.
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 solely by
holders of the APS. The other five directors will be elected by holders of the
outstanding common stock and APS, voting together as a single class. Richard Q.
Armstrong, David J. Beaubien, Richard R. Burt, Carl W. Schafer and William D.
White have been nominated as the directors that are to be elected by all common
stock and APS holders. Each of the nominees was last elected director at the
Fund's July 2003 Annual Meeting of Shareholders. Unless you give contrary
instructions on the enclosed proxy card: if you are a holder of the APS, your
APS shares will be voted FOR the election of all seven nominees; and, if you are
a holder of the common stock, your shares of common stock will be voted FOR the
five 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.
Directors, including those who are not "interested persons" of the Fund as
that term is defined by the Investment Company Act of 1940, as amended ("1940
Act") ("Independent Directors"), shall be elected by the affirmative vote of the
holders of a plurality of the shares of the Fund cast in person or by proxy and
entitled to vote thereon, provided a quorum is present. Proxies cannot be voted
for a greater number of persons than the number of nominees named. None of the
current directors and executive officers (16 persons) beneficially owned any
shares of the Fund's common stock or APS on April 30, 2004.
2
Listed in the table below, for each nominee, is a brief description of the
nominee's experience as a director of the Fund and as a director or trustee of
other funds, as well as other recent professional experience.
POSITION(S) LENGTH OF NUMBER OF PORTFOLIOS IN
HELD WITH TIME PRINCIPAL OCCUPATION(S) FUND COMPLEX OVERSEEN OTHER DIRECTORSHIPS
NAME, ADDRESS, AND AGE FUND SERVED DURING PAST 5 YEARS BY NOMINEE HELD BY NOMINEE
---------------------- ---- ------ ------------------- ---------- ---------------
INTERESTED DIRECTOR:
Margo N. Alexander+; 57 Director Since Mrs. Alexander is retired. Mrs. Alexander is a director None
c/o UBS Global Asset 1995 She was an executive vice or trustee of 16 investment
Management president of UBS Financial companies (consisting of 35
51 West 52nd Street Services Inc. (from March portfolios) for which UBS
New York, NY 10019-6114 1984 to December 2002). Global AM or one of its
She was chief executive affiliates serves as
officer (from January 1995 investment advisor,
to October 2000), a sub-advisor or manager.
director (from January
1995 to September 2001)
and chairman (from March
1999 to September 2001)
of UBS Global AM (formerly
known as Mitchell Hutchins
Asset Management Inc.).
INDEPENDENT DIRECTORS:
Richard Q. Armstrong; 68 Director Since Mr. Armstrong is chairman Mr. Armstrong is a director None
c/o Willkie, Farr & 1995 and principal of R.Q.A. or trustee of 16 investment
Gallagher LLP Enterprises (management companies (consisting of
787 Seventh Avenue consulting firm) (since 35 portfolios) for which
New York, NY 10019-6099 April 1991 and principal UBS Global AM or one
occupation since March of its affiliates serves as
1995). investment advisor, sub-
advisor or manager.
David J. Beaubien; 69 Director Since Mr. Beaubien is retired Mr. Beaubien is a director Mr. Beaubien is also
84 Doane Road 2001 (since 2003). He was or trustee of 16 investment a director of IEC
Ware, MA 01082 Chairman of Yankee companies (consisting of Electronics, Inc., a
Environmental Systems, 35 portfolios) for which manufacturer of
Inc., a manufacturer of UBS Global AM or one electronic assemblies.
meteorological measuring of its affiliates serves as
systems (since 1991). investment advisor, sub-
advisor or manager.
Richard R. Burt; 57 Director Since Mr. Burt is chairman of Mr. Burt is a director or Mr. Burt is also a
1275 Pennsylvania 1995 Diligence LLC trustee of 16 investment director of Hollinger
Ave., N.W. (international information companies (consisting of International Inc.
Washington, D.C. 20004 and security firm) and IEP 35 portfolios) for which (publishing), HCL
Advisors (international UBS Global AM or one Technologies, Ltd.,
investments and consulting of its affiliates serves as (software and
firm). investment advisor, sub- information
advisor or manager. technologies), The
Central European Fund,
Inc., The Germany Fund,
Inc., IGT, Inc. (provides
technology to gaming and
wagering industry) and
chairman of Weirton Steel
Corp. (makes and finishes
steel products). He is
also a director or
trustee of funds in the
Scudder Mutual Funds
Family (consisting of 47
portfolios).
3
POSITION(S) LENGTH OF NUMBER OF PORTFOLIOS IN
HELD WITH TIME PRINCIPAL OCCUPATION(S) FUND COMPLEX OVERSEEN OTHER DIRECTORSHIPS
NAME, ADDRESS, AND AGE FUND SERVED DURING PAST 5 YEARS BY NOMINEE HELD BY NOMINEE
---------------------- ---- ------ ------------------- ---------- ---------------
Meyer Feldberg; 62 Director Since Mr. Feldberg is Dean and Dean Feldberg is a director Dean Feldberg is
Columbia University 1993 Professor of Management or trustee of 30 investment also a director of
101 Uris Hall of the Graduate School of companies (consisting of Primedia Inc.
New York, New York 10027 Business, Columbia 49 portfolios) for which (publishing),
University (since 1989). UBS Global AM or one Federated
of its affiliates serves as Department Stores,
investment advisor, sub- Inc. (operator of
advisor or manager. department stores),
Revlon, Inc. (cosmetics),
Select Medical Inc.
(healthcare services) and
SAPPI, Ltd. (producer of
paper).
Carl W. Schafer; 68 Director Since Mr. Schafer is president of Mr. Schafer is a director or Mr. Schafer is also a
66 Witherspoon Street 1996 the Atlantic Foundation trustee of 16 investment director of Labor
#1100 (charitable foundation) companies (consisting of Ready, Inc.
Princeton, NJ 08542 (since 1990). 35 portfolios) for which (temporary
UBS Global AM or one employment),
of its affiliates serves as Guardian Life
investment advisor, sub- Insurance Company
advisor or manager. Mutual Funds
(consisting of 25
portfolios), the Harding,
Loevner Funds (consisting
of three portfolios),
E.I.I. Realty Securities
Trust (investment
company) and Frontier Oil
Corporation.
William D. White; 70 Director Since Mr. White is retired Mr. White is a director or None
P.O. Box 199 2001 (since 1994). trustee of 16 investment
Upper Black Eddy, PA companies (consisting of
18972 35 portfolios) for which
UBS Global AM or one
of its affiliates serves as
investment advisor, sub-
advisor or manager.
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+ Mrs. Alexander is an "interested person" of the Fund as defined in the
1940 Act by virtue of her former positions with UBS Global AM and/or any
of its affiliates.
4
INFORMATION ABOUT NOMINEE OWNERSHIP OF FUND SHARES
DOLLAR RANGE AGGREGATE DOLLAR RANGE OF EQUITY SECURITIES IN ALL
OF EQUITY REGISTERED INVESTMENT COMPANIES OVERSEEN BY NOMINEE
SECURITIES FOR WHICH UBS GLOBAL AM OR AN AFFILIATE SERVES AS
NOMINEE IN FUND+ INVESTMENT ADVISOR, SUB-ADVISOR OR MANAGER+
------- -------- -------------------------------------------
INTERESTED DIRECTORS:
Margo N. Alexander ..................... None Over $100,000
INDEPENDENT DIRECTORS:
Richard Q. Armstrong ................... None Over $100,000
David J. Beaubien ...................... None Over $100,000
Richard R. Burt ........................ None None
Meyer Feldberg ......................... None Over $100,000
Carl W. Schafer ........................ None $50,001-$100,000
William D. White ....................... None $10,001-$50,000
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+ Information regarding ownership of shares of the Fund is as of April 30,
2004; information regarding ownership of shares in all registered
investment companies overseen by nominee for which UBS Global AM or an
affiliate serves as investment advisor, sub-advisor or manager is as of
December 31, 2003.
As of December 31, 2003, the Independent Directors or their immediate
family members did not own any securities issued by UBS Global AM or any company
controlling, controlled by or under common control with UBS Global AM.
The board of directors of the Fund met seven times during the fiscal year
ended March 31, 2004. Each director attended 75% or more of the board meetings
during the last fiscal year. The Fund's directors are not required to attend the
Fund's annual meetings, and no directors attended the annual meeting of
shareholders in 2003.
The board has established an Audit Committee that acts pursuant to a
written charter ("Audit Committee Charter") and is responsible for: (i)
overseeing the Fund's accounting and financial reporting policies, practices and
internal controls; and (ii) reviewing the performance by certain of the Fund's
service providers of their contracts and arrangements with the Fund. A copy of
the charter is attached as Exhibit A. In fulfilling its duties, the Audit
Committee has: (a) reviewed and discussed the Fund's audited financial
statements with management; (b) discussed with the independent auditors the
matters required to be discussed by Statement on Auditing Standards No. 61; (c)
received certain written disclosures and the letter from the independent
auditors required by Independence Standards Board Standard No. 1 and discussed
the independent auditors' independence with them; and (d) based upon its review
of the above, recommended to the board that the Fund's audited financial
statements be included in the Fund's annual report to shareholders for the
fiscal year ended March 31, 2004. The Audit Committee currently consists of
Messrs. Armstrong, Beaubien, Burt, Feldberg and White, none of whom have any
relationship to the Fund that may interfere with the exercise of their
independence from management or the Fund, and who are independent as defined
under listing standards of the New York Stock Exchange applicable to closed-end
funds. Each member of the Fund's Audit Committee is also a member of a similar
committee established by the boards of certain other investment companies for
which UBS Global AM or an affiliate serves as investment advisor, sub-advisor or
manager. The Audit Committee met six times during the fiscal year ended March
31, 2004 and each member attended at least 75% of those meetings.
5
The board has also established a Nominating Committee that acts pursuant
to a written charter ("Nominating Committee Charter"). The Nominating Committee
is responsible for, among other things: selecting, evaluating and recommending
to the board candidates to be nominated as additional Independent Directors of
the Board; and reviewing the composition of the board and the compensation
arrangements for each of the directors. A copy of the Nominating Committee
Charter is attached as Exhibit B. The Nominating Committee currently consists of
Messrs. Feldberg, Schafer and White, none of whom are "interested" for purposes
of ss.2(a)(19) of the 1940 Act, and all of whom are independent as defined under
listing standards of the New York Stock Exchange applicable to closed-end funds.
The Nominating Committee met once during the fiscal year ended March 31, 2004.
In nominating candidates, the Nominating Committee believes that no specific
qualifications or disqualifications are controlling or paramount, or that
specific qualities or skills are necessary for each candidate to possess. In
identifying and evaluating nominees for director, the Nominating Committee takes
into consideration such factors as it deems appropriate. These factors may
include: (i) whether or not the person is an "interested person" as defined in
the 1940 Act, meets the independence and experience requirements of the NYSE
cited above and is otherwise qualified under applicable laws and regulations to
serve as a member of the board; (ii) whether or not the person has any
relationships that might impair his or her independence, such as any business,
financial or family relationships with Fund management, the investment advisor
and/or sub-advisors of the Fund, Fund service providers or their affiliates;
(iii) whether or not the person is willing to serve, and willing and able to
commit the time necessary for the performance of the duties of a board member;
(iv) the person's judgment, skill, diversity and experience with investment
companies and other organizations of comparable purpose, complexity and size and
subject to similar legal restrictions and oversight; (v) the interplay of the
candidate's experience with the experience of other board members; and (vi) the
extent to which the candidate would be a desirable addition to the board and any
committees thereof. The Nominating Committee will consider nominees recommended
by shareholders if a vacancy occurs. In order to recommend a nominee, a
shareholder should send a letter to the chairperson of the Nominating Committee,
Mr. Meyer Feldberg, care of the Secretary of the Fund at 51 West 52nd Street,
New York, New York 10019-6114 and indicate on the envelope "Nominating
Committee." The shareholder's letter should state the nominee's name and should
include the nominee's RESUME or CURRICULUM VITAE. The board does not have a
standing compensation committee.
Each Independent Director receives, in the aggregate from the UBS Global
AM funds, an annual retainer of $70,000 and a $13,000 fee for each regular board
meeting (and each in-person special board meeting) actually attended.
Independent Directors who participate in previously scheduled in-person meetings
by telephone to accommodate other business obligations are paid $2,000 for such
meetings. Independent Directors who participate in previously scheduled
in-person meetings by telephone because of illness or other unavoidable
circumstances are paid the full meeting fee. The chairperson of the Audit
Committee receives annually $25,000. The chairperson of the Nominating Committee
receives annually $10,000. The foregoing fees will be allocated among all such
funds (or each relevant fund in the case of a special meeting) as follows: (i)
one-half of the expense will be allocated PRO RATA based on the funds' relative
net assets at the end of the calendar quarter preceding the date of payment and
(ii) one-half of the expense will be allocated according to the number of such
funds (i.e., expense divided by number of funds yields per-fund allocation). No
officer, director or employee of UBS Global AM or one of its affiliates
presently receives any compensation from the Fund for acting as a board member
or officer. All board members are reimbursed for expenses incurred in attending
meetings.
6
Each director who has attained the age of seventy-two (72) years will be
subject to retirement on the last day of the month in which he or she attains
such age. The table below includes certain information relating to the
compensation of the Fund's Independent Directors.
COMPENSATION TABLE+
TOTAL
AGGREGATE COMPENSATION
COMPENSATION FROM THE FUND
NAME OF FROM AND THE
PERSON, POSITION THE FUND* FUND COMPLEX**
---------------- --------- --------------
Richard Q. Armstrong, Director ............... $1,479 $112,500
David J. Beaubien, Director .................. 1,323 100,000
Richard R. Burt, Director .................... 1,286 100,000
Meyer Feldberg, Director ..................... 1,370 200,125
Carl W. Schafer, Director .................... 1,323 100,000
William D. White, Director ................... 1,323 100,000
----------
+ Only Independent Directors are compensated by the funds for which UBS
Global AM or an affiliate serves as investment advisor, sub-advisor or
manager; directors who are "interested persons," as defined by the 1940
Act, do not receive compensation from the funds.
* Represents fees paid to each director during the fiscal year ended March
31, 2004.
** Represents fees paid during the calendar year ended December 31, 2003 to
each board member by: (a) 22 investment companies in the case of Messrs.
Armstrong, Beaubien, Burt, Schafer and White; and (b) 36 investment
companies in the case of Mr. Feldberg for which UBS Global AM or one of
its affiliates served as investment advisor, sub-advisor or manager. No
fund within the UBS fund complex has a bonus, pension, profit sharing or
retirement plan.
7
INFORMATION CONCERNING INDEPENDENT AUDITORS
The Fund's financial statements for the fiscal year ended March 31, 2004,
were audited by Ernst & Young LLP ("Ernst & Young"), independent auditors. In
addition, Ernst & Young prepares the Fund's federal and state annual income tax
returns and provides certain non-audit services. The Audit Committee has
considered whether the provision of those non-audit services is compatible with
maintaining Ernst & Young's independence. The board of directors of the Fund has
selected Ernst & Young as the independent auditors for the Fund for the fiscal
year ending March 31, 2005. Ernst & Young has been the Fund's independent
auditors since its inception in June 1993. Ernst & Young has informed the Fund
that it has no material direct or indirect financial interest in the Fund.
Representatives of Ernst & Young 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.
AUDIT FEES.
The aggregate audit fees billed by Ernst & Young for professional services
rendered to the Fund for the fiscal years ended March 31, 2004 and March 31,
2003 were approximately $44,650 and $30,700; respectively.
Fees included in the audit fees category are those associated with the
annual audits of financial statements and services that are normally provided in
connection with statutory and regulatory filings or engagements for those fiscal
years (e.g., review of portions of 2003 Form N-SAR filing) and registration
statement consents.
AUDIT-RELATED FEES.
The aggregate audit-related fees billed by Ernst and Young for services
rendered to the Fund that are reasonably related to the performance of the
audits of the financial statements, but not reported as audit fees, were
approximately $15,618 and $24,175, respectively, in each of the fiscal years
ended March 31, 2004 and March 31, 2003. This amount includes amounts related to
non-audit services prior to May 6, 2003 that would have been subject to
pre-approval if the Securities and Exchange Commission ("SEC") rules relating to
the pre-approval of non-audit services had been in efffect at that time.
Fees included in the audit-related category are those associated with (1)
the reading and providing of comments on the 2003 semiannual financial
statements, (2) review of portions of the registrant's semiannual 2003 Form
N-SAR filing, (3) review of the consolidated profitability of UBS Global AM to
assist the directors in their annual advisory/administration contract and
service/distribution plan reviews for calendar year 2003 and 2002 and (4)
compliance review for the registrant's fiscal year ended 2003.
With respect to Rule 2-01(c)(7)(i)(C) of Regulation S-X, there were no
audit-related fees that were approved by the Audit Committee pursuant to the de
minimis exception for the fiscal years ended March 31, 2004 and March 31, 2003
on behalf of (i) the Fund's service providers that relate directly to the
operations and financial reporting of the Fund, or (ii) the Fund itself. This
includes amounts related to non-audit services prior to May 6, 2003 that would
have been subject to pre-approval if the SEC rules relating to the pre-approval
of non-audit services had been in effect at that time. There were no
audit-related fees required to be approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X during the fiscal years indicated above.
TAX FEES.
The aggregate tax fees billed by Ernst and Young for services rendered to
the Fund for each of the fiscal years ended March 31, 2004 and March 31, 2003
were approximately $8,300 and $10,590, respectively. This amount includes
amounts related to non-audit services prior to May 6, 2003 that would have been
subject to pre-approval if the SEC rules relating to the pre-approval of
non-audit services had been in effect at that time.
8
Fees included in the tax fees category comprise all services performed by
professional staff in the independent accountant's tax division except those
services related to the audits. This category comprises fees for review of tax
compliance and tax return preparation.
With respect to Rule 2-01(c)(7)(i)(C) of Regulation S-X, there were no tax
fees that were approved by the Audit Committee pursuant to the de minimis
exception for the fiscal years ended March 31, 2004 and March 31, 2003 on behalf
of (i) the Fund's service providers that relate directly to the operations and
financial reporting of the Fund, or (ii) the Fund itself. This includes amounts
related to non-audit services prior to May 6, 2003 that would have been subject
to pre-approval if the SEC rules relating to the pre-approval of non-audit
services had been in effect at that time. There were no tax fees required to be
approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X during
the fiscal years indicated above.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES.
There were no fees billed by Ernst & Young for the most recent fiscal year
for professional services rendered for financial information systems design and
implementation services provided to the Fund, UBS Global AM and entities that
control, are controlled by or are under common control with UBS Global AM that
provide services to the Fund.
ALL OTHER FEES.
For the fiscal years ended March 31, 2004 and March 31, 2003, there were
no fees billed by Ernst & Young for other services provided to the Fund. Fees
included in the all other fees category would consist of services related to
internal control reviews, strategy and other consulting, financial information
systems design and implementation, consulting on other information systems, and
other tax services unrelated to the Funds.
With respect to Rule 2-01(c)(7)(i)(C) of Regulation S-X, there were no
fees within this category that were approved by the Audit Committee pursuant to
the de minimis exception for the fiscal years ended March 31, 2004 and March 31,
2003 on behalf of (i) the Fund's service providers that relate directly to the
operations and financial reporting of the Fund, or (ii) the Fund itself. This
includes amounts related to non-audit services prior to May 6, 2003 that would
have been subject to pre-approval if the SEC rules relating to the pre-approval
of non-audit services had been in effect at that time. There were no "all other
fees" required to be approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of
Regulation S-X during the fiscal years indicated above.
The Audit Committee Charter contains the audit committee's pre-approval
policies and procedures. Reproduced below is an excerpt from the Audit Committee
Charter regarding pre-approval policies and procedures:
The Audit Committee shall:
Pre-approve (a) all audit and permissible non-audit services(1) to be
provided to the Fund and (b) all permissible non-audit services to be provided
by the Fund's independent auditors to UBS Global AM and any Covered Service
Providers, if the engagement relates directly to the operations and financial
reporting of the Fund. In carrying out this responsibility, the Committee shall
seek periodically from UBS Global AM and from the independ
----------
(1) The Committee will not approve non-audit services that the Committee
believes may taint the independence of the auditors. Currently,
permissible non-audit services include any professional services
(including tax services) that are not prohibited services as described
below, provided to the Fund by the independent auditors, other than those
provided to the Fund in connection with an audit or a review of the
financial statements of the Fund. Permissible non-audit services may not
include: (i) bookkeeping or other services related to the accounting
records or financial statements of the Fund; (ii) financial information
systems design
9
ent auditors a list of such audit and permissible non-audit services that can be
expected to be rendered to the Fund, UBS Global AM or any Covered Service
Providers by the Fund's independent auditors, and an estimate of the fees sought
to be paid in connection with such services. The Committee may delegate its
responsibility to pre-approve any such audit and permissible non-audit services
to a sub-committee consisting of the Chairperson of the Committee and two other
members of the Committee as the Chairperson, from time to time, may determine
and appoint, and such sub-committee shall report to the Committee, at its next
regularly scheduled meeting after the sub-committee's meeting, its decision(s).
From year to year, the Committee shall report to the board whether this system
of pre-approval has been effective and efficient or whether this Charter should
be amended to allow for pre-approval pursuant to such policies and procedures as
the Committee shall approve, including the delegation of some or all of the
Committee's pre-approval responsibilities to other persons (other than UBS
Global AM or the Fund's officers).
For the fiscal years ended March 31, 2004, the aggregate fees billed by
Ernst & Young of $3,193,093 included non-audit services rendered on behalf of
the Fund of $23,918, and non-audit services rendered on behalf of the Fund's
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser) and any entity controlling, controlled by, or under common control with
the investment adviser of $3,169,175. For the fiscal years ended March 31, 2003,
the aggregate fees billed by Ernst & Young of $2,839,418 included non-audit
services rendered on behalf of the Fund of $34,765 and non-audit services
rendered on behalf of the Fund's investment adviser (not including any
sub-adviser whose role is primarily portfolio management and is subcontracted
with or overseen by another investment adviser) and any entity controlling,
controlled by, or under common control with the investment adviser of
$2,804,653.
The Audit Committee was not required to consider whether the provision of
non-audit services that were rendered to the Fund's investment adviser (not
including any sub-adviser whose role is primarily portfolio management and is
subcontracted with or overseen by another investment adviser), and any entity
controlling, controlled by, or under common control with the investment adviser
that provides ongoing services to the Fund that were not pre-approved pursuant
to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with
maintaining Ernst & Young's independence.
----------
and implementation; (iii) appraisal or valuation services, fairness
opinions or contribution-in-kind reports; (iv) actuarial services; (v)
internal audit outsourcing services; (vi) management functions or human
resources; (vii) broker or dealer, investment adviser or investment
banking services; (viii) legal services and expert services unrelated to
the audit; and (ix) any other service the Public Company Accounting
Oversight Board determines, by regulation, is impermissible.
Pre-approval by the Committee of any permissible non-audit services is not
required so long as: (i) the aggregate amount of all such permissible
non-audit services provided to the Fund, UBS Global AM and any service
providers controlling, controlled by or under common control with UBS
Global AM that provide ongoing services to the Fund ("Covered Service
Providers") constitutes not more than 5% of the total amount of revenues
paid to the independent auditors (during the fiscal year in which the
permissible non-audit services are provided) by (a) the Fund, (b) its
investment adviser and (c) any entity controlling, controlled by, or under
common control with the investment adviser that provides ongoing services
to the Fund during the fiscal year in which the services are provided that
would have to be approved by the Committee; (ii) the permissible non-audit
services were not recognized by the Fund at the time of the engagement to
be non-audit services; and (iii) such services are promptly brought to the
attention of the Committee and approved by the Committee (or its
delegate(s)) prior to the completion of the audit.
10
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 are:
PRINCIPAL OCCUPATION(S) DURING PAST 5 YEARS;
POSITION(S) HELD LENGTH OF NUMBER OF PORTFOLIOS IN FUND COMPLEX
NAME, ADDRESS, AND AGE WITH THE FUND TIME SERVED FOR WHICH PERSON SERVES AS OFFICER
---------------------- ------------- ----------- ----------------------------------
W. Douglas Beck*; 37 Vice President Since 2003 Mr. Beck is an executive director and head of mutual fund
product management of UBS Global AM (since 2002). From March
1998 to November 2002, he held various positions at Merrill
Lynch, the most recent being first vice president and
co-manager of the managed solutions group. Mr. Beck is vice
president of 19 investment companies (consisting of 76
portfolios) for which UBS Global AM or one of its affiliates
serves as investment advisor, sub-advisor or manager.
Thomas Disbrow*; 38 Vice President Since 2000 Mr. Disbrow is a director and a senior manager of the mutual
and Assistant fund finance department of UBS Global AM. Prior to November
Treasurer 1999, he was a vice president of Zweig/Glaser Advisers. Mr.
Disbrow is a vice president and assistant treasurer of 16
investment companies (consisting of 35 portfolios) for which
UBS Global AM or one of its affiliates serves as investment
advisor, sub-advisor or manager.
Amy R. Doberman*; 42 Vice President Since 2000 Ms. Doberman is a managing director and general counsel of
and Secretary UBS Global AM. From December 1997 through July 2000, she was
general counsel of Aeltus Investment Management, Inc. Ms.
Doberman is vice president and assistant secretary of five
investment companies (consisting of 44 portfolios) and vice
president and secretary of 16 investment companies
(consisting of 35 portfolios) for which UBS Global AM or one
of its affiliates serves as investment advisor, sub-advisor
or manager.
Elbridge T. Gerry III*; 47 Vice President Since 1996 Mr. Gerry is a managing director--fixed income of UBS Global
AM. Mr. Gerry is a vice president of six investment
companies (consisting of 12 portfolios) for which UBS Global
AM or one of its affiliates serves as investment advisor,
sub-advisor or manager.
11
PRINCIPAL OCCUPATION(S) DURING PAST 5 YEARS;
POSITION(S) HELD LENGTH OF NUMBER OF PORTFOLIOS IN FUND COMPLEX
NAME, ADDRESS, AND AGE WITH THE FUND TIME SERVED FOR WHICH PERSON SERVES AS OFFICER
---------------------- ------------- ----------- ----------------------------------
David M. Goldenberg*; 37 Vice President Since 2002 Mr. Goldenberg is an executive director and deputy general
and Assistant counsel of UBS Global AM. From 2000 to 2002 he was director,
Secretary legal affairs at Lazard Asset Management. Mr. Goldenberg
served in various capacities, including most recently as
global director of compliance, at SSB Citi Asset Management
Group from 1996 to 2000. Mr. Goldenberg is a vice president
and secretary of five investment companies (consisting of 44
portfolios) and a vice president and assistant secretary of
16 investment companies (consisting of 35 portfolios) for
which UBS Global AM or one of its affiliates serves as
investment advisor, sub-advisor or manager.
Paul H. Schubert*; 41 Vice President Since 1994 Mr. Schubert is an executive director and head of mutual
and Treasurer fund services of UBS Global AM. Mr. Schubert is treasurer
and principal accounting officer of three investment
companies (consisting of 41 portfolios), a vice president
and treasurer of 17 investment companies (consisting of 36
portfolios), and treasurer and chief financial officer of
one investment company (consisting of two portfolios) for
which UBS Global AM or one of its affiliates serves as
investment advisor, sub-advisor or manager.
Joseph A. Varnas*; 36 President Since 2003 Mr. Varnas is a managing director (since March 2003), global
head of information technology and operations (since March
2004) and head of product management--Americas (since
November 2002) of UBS Global AM. He was head of technology
of UBS Global AM from November 2002 to March 2004. From 2000
to 2001, he was manager of product development in Investment
Consulting Services at UBS Financial Services Inc. Mr.
Varnas was a senior analyst in the Global Securities
Research and Economics Group at Merrill Lynch from 1995 to
1999. Mr. Varnas is president of 20 investment companies
(consisting of 77 portfolios) for which UBS Global AM or one
of its affiliates serves as investment advisor, sub-advisor
or manager.
12
PRINCIPAL OCCUPATION(S) DURING PAST 5 YEARS;
POSITION(S) HELD LENGTH OF NUMBER OF PORTFOLIOS IN FUND COMPLEX
NAME, ADDRESS, AND AGE WITH THE FUND TIME SERVED FOR WHICH PERSON SERVES AS OFFICER
---------------------- ------------- ----------- ----------------------------------
William Veronda*; 58 Vice President Since 2004 Mr. Veronda is an executive director--fixed income of UBS
Global AM (since 1995). Mr. Veronda is a vice president of
two investment companies (consisting of two portfolios) for
which UBS Global AM or one of its affiliates serves as
investment advisor, sub-advisor or manager.
Keith A. Weller*; 42 Vice President Since 1995 Mr. Weller is a director and senior associate general
and Assistant counsel of UBS Global AM. Mr. Weller is a vice president and
Secretary assistant secretary of 16 investment companies (consisting
of 35 portfolios) for which UBS Global AM or one of its
affiliates serves as investment advisor, sub-advisor or
manager.
----------------
* This person's business address is 51 West 52nd Street, New York, New York
10019-6114.
13
OTHER INFORMATION
BENEFICIAL OWNERSHIP OF SHARES
Management does not know of any person who owns beneficially 5% or more of
the common stock of the Fund.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
An initial report under Section 16(a) of the Securities Exchange Act of
1934 was not timely filed for Mr. Varnas. This delayed report did not involve
any transactions in the Fund's common stock but rather related to his election
as an officer.
SHAREHOLDER PROPOSALS
Any shareholder who wishes to submit proposals to be considered at the
Fund's 2005 annual meeting of shareholders should send such proposals to the
Secretary of the Fund at 51 West 52nd Street, New York, New York 10019-6114. In
order to be considered at that meeting, shareholder proposals must be received
by the Fund no later than January 30, 2005 and must satisfy other requirements
of the federal securities laws.
OTHER BUSINESS
Management knows of no business to be presented to 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,
AMY R. DOBERMAN
SECRETARY
May 28, 2004
----------------------------------------------------------------
IT IS IMPORTANT THAT YOU EXECUTE AND RETURN YOUR PROXY PROMPTLY.
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14
EXHIBIT A
AUDIT COMMITTEE CHARTER
AMENDED AND RESTATED AS OF MAY 12, 2004
ESTABLISHMENT AND PURPOSE
This document serves as the Charter for the Audit Committee (the
"Committee") of the Board of each fund (the "Fund") advised by UBS Global Asset
Management (US) Inc. ("UBS Global") listed on Appendix A hereto (each such
Charter being a separate Charter). The primary purposes of the Committee are to
assist Board oversight of (1) the integrity of the Fund's financial statements,
(2) the Fund's compliance with legal and regulatory requirements, (3) the
independent auditors' qualifications and independence and (4) the performance of
the Fund's independent auditors.
In performing its Board oversight assistance function, the Committee will,
among other things (a) oversee the scope of the Fund's audit, the quality and
objectivity of the Fund's financial statements, the Fund's accounting and
financial reporting policies and practices and its internal controls and, as
appropriate, the internal controls of certain service providers; (b) approve,
and recommend to the Board, for ratification, the selection, appointment,
retention or termination of the Fund's independent auditors, as well as
determining the compensation thereof; and (c) pre-approve all audit and
non-audit services provided to the Fund and certain other persons by such
independent auditors.
DUTIES AND RESPONSIBILITIES
AUDIT OVERSIGHT
The Fund's independent auditors are accountable to the Committee.
The Committee shall:
1. Approve, and recommend to the Board for the Board's ratification,
the selection, appointment, retention or termination of the Fund's
independent auditors, or of any other public accounting firm engaged
for the purpose of performing other audit, review or attest services
for the Fund.
2. Pre-approve (a) all audit and permissible non-audit services(1) to
be provided to the Fund and (b) all permissible non-audit services
to be provided by the Fund's independent auditors to UBS Global and
any Covered Service Providers, if the engagement relates directly to
the operations and financial reporting of the Fund. In carrying out
this responsibility, the Committee shall seek periodically from UBS
Global and from the independent auditors a list of such audit and
permissible non-audit services that can be expected
----------
(1) The Committee will not approve non-audit services that the Committee
believes may taint the independence of the auditors. Currently,
permissible non-audit services include any professional services
(including tax services) that are not prohibited services as described
below, provided to the Fund by the independent auditors, other than those
provided to the Fund in connection with an audit or a review of the
financial statements of the Fund. Permissible non-audit services may NOT
include: (i) bookkeeping or other services related to the accounting
records or financial statements of the Fund; (ii) financial information
systems design and implementation; (iii) appraisal or valuation services,
fairness opinions or contribution-in-kind reports; (iv) actuarial
services; (v) internal audit outsourcing services; (vi) management
functions or human resources; (vii) broker or dealer, investment adviser
or investment banking services; (viii) legal services and expert services
unrelated to the audit; and (ix) any other service the Public Company
Accounting Oversight Board determines, by regulation, is impermissible.
A-1
to be rendered to the Fund, UBS Global or any Covered Service
Providers by the Fund's independent auditors, and an estimate of the
fees sought to be paid in connection with such services. The
Committee may delegate its responsibility to pre-approve any such
audit and permissible non-audit services to a sub-committee
consisting of the Chairperson of the Committee and two other members
of the Committee as the Chairperson, from time to time, may
determine and appoint, and such sub-committee shall report to the
Committee, at its next regularly scheduled meeting after the
sub-committee's meeting, its decision(s). From year to year, the
Committee shall report to the Board whether this system of
pre-approval has been effective and efficient or whether this
Charter should be amended to allow for pre-approval pursuant to such
policies and procedures as the Committee shall approve, including
the delegation of some or all of the Committee's pre-approval
responsibilities to other persons (other than UBS Global or the
Fund's officers).
3. Discuss with the independent auditors any disclosed relationships or
services that may diminish the objectivity and independence of the
independent auditors; receive periodic reports from the independent
auditors regarding the independent auditors' independence (including
receiving the independent auditors' specific representations as to
independence consistent with current statements of the Independence
Standards Board); and discuss such reports with the independent
auditors, and, if so determined by the Committee, recommend that the
Board take appropriate action to ensure the independence of the
independent auditors.
4. Review, in consultation with the independent auditors, the scope of
the Fund's proposed audit each year, including the audit procedures
to be utilized, and certain other matters in connection with the
Fund's financial statements.
5. Inquire of UBS Global and the independent auditors as to the Fund's
qualification under Subchapter M of the Internal Revenue Code and
amounts distributed and reported to shareholders for Federal tax
purposes.
6. [Closed-end Funds only] Review and discuss the Fund's audited annual
financial statements and unaudited semiannual reports with UBS
Global and, in the case of the audited financials, the independent
auditors, including the Fund's disclosure of management's discussion
of Fund performance.
7. Review with the independent auditors any problems or difficulties
the auditors may have encountered during the conduct of the audit,
relating to the conduct of the audit, including any matters required
to be discussed pursuant to Statement of Auditing Standards No. 61,
or any subsequent Statement, and management's response.
----------
Pre-approval by the Committee of any permissible non-audit services is not
required so long as: (i) the aggregate amount of all such permissible
non-audit services provided to the Fund, UBS Global and any service
providers controlling, controlled by or under common control with UBS
Global that provide ongoing services to the Fund ("Covered Service
Providers") constitutes not more than 5% of the total amount of revenues
paid to the independent auditors (during the fiscal year in which the
permissible non-audit services are provided) by (a) the Fund, (b) its
investment adviser and (c) any entity controlling, controlled by, or under
common control with the investment adviser that provides ongoing services
to the Fund during the fiscal year in which the services are provided that
would have to be approved by the Committee; (ii) the permissible non-audit
services were not recognized by the Fund at the time of the engagement to
be non-audit services; and (iii) such services are promptly brought to the
attention of the Committee and approved by the Committee (or its
delegate(s)) prior to the completion of the audit.
A-2
8. Ensure that the independent auditors submit on a periodic basis to
the Committee a formal written statement delineating all
relationships of the auditors consistent with Independence Standards
Board Standard No. 1, or any subsequent Statement.
9. Review, in consultation, as appropriate, with the independent
auditors and Fund service providers, matters relating to internal
controls and disclosure controls and procedures at the Fund and at
the Fund's service providers.
10. Request, receive and/or review from the independent auditors such
other materials as deemed necessary or advisable by the Committee in
the exercise of its duties under this charter; such materials may
include, without limitation, any other material written
communications bearing on the Fund's financial statements, or
internal or disclosure controls, between the independent auditors
and the Fund, UBS Global, the Fund's sub-adviser(s), if any, or
other Fund service providers, such as any management letter or
schedule of unadjusted differences, and any comment or "deficiency"
letter received from a regulatory or self-regulatory organization
addressed to the Fund, UBS Global or the Fund's sub-adviser(s), if
any, that relates to services rendered to the Fund.
11. Establish procedures for the receipt, retention and treatment of
complaints that the Fund may receive regarding Fund accounting,
internal accounting controls or auditing matters, including
procedures (set forth on APPENDIX C hereto) for the confidential,
anonymous submission by Fund officers or employees and the Fund's
investment adviser (including sub-advisers, if any),
administrator(s), principal underwriter or any other provider of
accounting-related services for the Fund of concerns regarding
questionable accounting or auditing matters related to the Fund.
12. Request that the independent auditors report to the Committee on any
unusual items or matters discovered during the course of any
semi-annual or other reviews.
13. [Closed-end Funds only] Consider and, if appropriate, recommend the
publication of the Fund's annual audited financial statements in the
Fund's annual report in advance of the printing and publication of
the annual report, based on its review and discussions of such
annual report with the independent auditors, the Fund's officers and
UBS Global; and prepare the audit committee report required to be
included in the Fund's proxy statement for its annual meeting of
shareholders.
14. [Closed-end Funds only] At least annually, obtain and review a
report by the Fund's independent auditors describing (i) the
independent auditors' internal quality-control procedures; (ii) any
material issues raised by the most recent internal quality-control
review, or peer review, of the independent auditors, or by any
inquiry or investigation by governmental or professional
authorities, within the preceding five years, respecting one or more
independent audits carried out by the independent auditors, and any
steps taken to deal with such issues; and (iii) (to assess the
independent auditors' independence) all relationships between the
independent auditor and the Fund.
15. [Closed-end Funds only] Discuss in general the Fund's periodic
earnings releases, as well as any financial information and earnings
guidance provided to analysts and rating agencies.
16. [Closed-end Funds only] Discuss policies with respect to risk
assessment and risk management.
17. [Closed-end Funds only] Review hiring policies of UBS Global and the
Fund, if any, for employees and former employees of the Fund's
independent auditors.
18. [Closed-end Funds only] Prepare an annual performance evaluation of
the Committee for the Board's review.
19. Review and reassess the adequacy of this Charter annually and
recommend any proposed changes to the Board for approval.
A-3
In performing its duties, the Committee shall be provided by UBS Global,
the Fund's sub-advisor(s), if any, or the Fund, as applicable, with such
information, data and services as the Committee shall request to discharge its
duties and responsibilities, shall consult as it deems appropriate with the
members of the Board, officers and employees of the Fund, UBS Global, the Fund's
sub-advisor(s), if any, the Fund's counsel and the Fund's other service
providers and, as it determines necessary to carry out its duties and at the
Fund's expense, may engage outside advisors and consultants. In carrying out its
functions, the Committee shall meet separately, periodically, with management
and with the Fund's independent auditors. The Fund shall provide appropriate
funding for the Committee to carry out its duties and responsibilities.
COMPOSITION
The Committee shall have a minimum of three members and shall be composed
of a number of Board members, each of whom has been determined not to be an
"interested person," as that term is defined in Section 2(a)(19) of the
Investment Company Act of 1940, as amended ("1940 Act"), of the Fund (the
"Independent Board Members"), as the Board shall determine from time to time.
Each member of the Committee must also meet the independence and experience
requirements as set forth in Sections 303A.07(a) and 303.01(b)(2)(a) of the New
York Stock Exchange's Listed Company Manual, in each case as applicable to
closed-end Funds. The Committee shall elect a chairperson, who shall preside
over Committee meetings (the "Chairperson"). The Chairperson shall serve for a
term of three years, which term may be renewed from time to time.(2)
In addition, the Board shall use its best efforts to ensure that at least
one member of the Committee is an "audit committee financial expert," as
determined under the rules of the Securities and Exchange Commission. Appendix B
sets forth the audit committee financial expert requirements as of the date of
this amended and restated Charter. In the event that the Committee does not have
at least one such audit committee financial expert, the nominating committee of
the Board shall endeavor to identify and recommend to the Board a candidate that
meets such requirements or, in the event the Board does not, at such time, have
a nominating committee, the Board shall designate the Independent Board Members
as a committee to identify and recommend to the Board a candidate that meets
such requirements.
For those Funds listed on the NYSE, no member of the Committee may serve
on the audit committees of more than three public companies, including all Funds
managed by UBS Global (deemed for these purposes to be a single public company),
unless the Board determines that such simultaneous service would not impair the
ability of such member to serve on the Committee effectively.
MEETINGS
The Committee shall meet on a regular basis, but not less frequently than
twice a year. Special meetings may also be held upon reasonable notice to the
members of the Committee. An agenda shall be established for each meeting.
Additional meetings shall be called as circumstances require. The Committee may
request any officer or employee of the Fund, the Fund's counsel, UBS Global, the
Fund's sub-adviser(s), if any, the Fund's independent auditors or other
interested persons to attend a meeting of the Committee or to meet with any
members of, or consultants to, the Committee. The Committee will meet with the
Fund's independent auditors at least once a year outside the presence of the
Fund's officers and other parties. The Committee may, in its discretion, also
meet outside the presence of the Fund's officers and other parties at other
times. Meetings of the Committee may be held in person, by telephone or by other
appropriate means.
----------
(2) In the case of a newly-organized UBS fund, the Chairperson's term will be
coterminous with those of the other UBS funds listed on Schedule A, even
if such term is shorter than three years.
A-4
One-third of the Committee's members shall constitute a quorum. At any
meeting of the Committee, the decision of a majority of the members present and
voting shall be determinative as to any matter submitted to a vote.
REPORTING
The Chairperson shall report to the Board on the result of its
deliberations and make such recommendations as deemed appropriate.
LIMITS ON ROLE OF COMMITTEE
While the Committee has the duties and responsibilities set forth in this
Charter, the Committee is not responsible for planning or conducting the Fund's
audit or for determining whether the Fund's financial statements are complete
and accurate and are in accordance with generally accepted accounting
principles. In fulfilling their responsibilities hereunder, it is recognized
that the members of the Committee are not full-time employees of the Fund, it is
not the duty or the responsibility of the Committee or its members to conduct
"field work" or other types of auditing or accounting reviews or procedures or
to set auditor independence standards, and each member of the Committee shall be
entitled to rely on (a) the integrity of those persons within and outside the
Fund from which it receives information; (b) the accuracy of the financial and
other information provided to the Committee absent actual knowledge to the
contrary (which shall be promptly reported to the Board); and (c) statements
made by the officers and employees of the Fund, UBS Global or other third
parties as to any information technology, internal audit and other non-audit
services provided by the independent auditors to the Fund. The review of the
Fund's financial statements by the Committee is not of the same quality as the
audit performed by the independent auditors.
In carrying out its responsibilities, the Committee's policies and
procedures shall be adapted, as appropriate, in order to best react to a
changing environment.
AMENDMENTS
This Charter may be amended by a vote of a majority of the Board members.
A-5
APPENDIX A
UBS Managed Municipal Trust
UBS Series Trust
UBS Investment Trust
UBS Index Trust
UBS Municipal Money Market Series
UBS Money Series
UBS PACE Select Advisors Trust
UBS Cashfund Inc.
UBS RMA Money Fund Inc.
UBS RMA Tax-Free Fund Inc.
UBS Master Series, Inc.
Strategic Global Income Fund, Inc.*
Global High Income Dollar Fund Inc.*
Investment Grade Municipal Income Fund Inc.*
Insured Municipal Income Fund Inc.*
Managed High Yield Plus Fund Inc.*
----------
* Closed-end Funds. The duties and responsibilities of any provision
applicable exclusively to closed-end funds apply to these funds only.
A-6
APPENDIX B
AUDIT COMMITTEE FINANCIAL EXPERT REQUIREMENTS
An "audit committee financial expert" is a person who has the following
attributes:
an understanding of generally accepted accounting principles and financial
statements;
the ability to assess the general application of such principles in
connection with the accounting for estimates, accruals and reserves;
experience preparing, auditing, analyzing or evaluating financial
statements that present a breadth and level of complexity of accounting
issues that are generally comparable to the breadth and complexity of
issues that can reasonably be expected to be raised by the registrant's
financial statements, or experience actively supervising one or more
persons engaged in such activities;
an understanding of internal controls and procedures for financial
reporting; and
an understanding of audit committee functions.
A person must have acquired such attributes through one or more of the
following:
education and experience as a principal financial officer, principal
accounting officer, controller, public accountant or auditor or
experience in one or more positions that involve the performance of
similar functions;
experience actively supervising a principal financial officer, principal
accounting officer, controller, public accountant, auditor or person
performing similar functions;
experience overseeing or assessing the performance of companies or public
accountants with respect to the preparation, auditing or evaluation of
financial statements; or
other relevant experience.
A-7
APPENDIX C
POLICIES OF THE AUDIT COMMITTEE
REGARDING CONCERNS OR COMPLAINTS RELATING TO
ACCOUNTING, INTERNAL ACCOUNTING CONTROLS OR
AUDITING MATTERS OR OTHER MATTERS RELATING
TO THE OPERATIONS OF THE FUND
INTRODUCTION
The following policies are adopted by the Board of each fund ("Fund")
advised by UBS Global Asset Management (US) Inc. ("UBS Global AM") listed on
Appendix A to the Fund's Audit Committee Charter ("Charter").
These policies shall constitute an amendment to, and a part of, the
Charter and shall be designated as Appendix C to the Charter. These policies
constitute the procedures to be established pursuant to Item 10 of "Duties and
Responsibilities--Audit Oversight" in the Charter; however, the Board has
decided to extend the benefit of these policies to all Funds, not just those
exchange-listed Funds that are required to establish such procedures pursuant to
Section 301 of the Sarbanes-Oxley Act and Rule 303A of the New York Stock
Exchange Inc. Listed Company Manual.
These policies establish (1) procedures for the receipt, retention and
treatment of complaints received by the Fund (including Fund officers) regarding
accounting, internal accounting controls or auditing matters or other matters
relating to the operations of the Fund, (2) procedures for the confidential,
anonymous submission of concerns regarding questionable accounting or auditing
matters by employees of the investment adviser (and sub-advisor, if applicable),
administrator (and sub-administrator, if applicable), principal underwriter (if
any), or any other provider of accounting related services for the Fund (each a
"Service Provider") and (3) protections for such persons bringing complaints or
concerns to the attention of the Board's Audit Committee (the "Committee").
REPORTING
It is expected that all board members and officers, as well as employees
of each Service Provider, will report promptly any concerns or complaints
regarding accounting, internal accounting controls or auditing matters or other
matters relating to the operations of the Fund. Employees of Service Providers
(including Fund officers) should first consider exhausting any internal
reporting mechanisms at their firm before directly contacting the Chairperson of
the Committee (or in the event of a potential conflict involving such person,
any other member of the Committee). If such a person does not receive a
satisfactory response within a reasonable period of time, or if he or she
believes that utilizing internal reporting mechanisms would be futile or
otherwise undesirable, he or she should (1) in the case of Service Providers
under the supervision of UBS Global AM (e.g., State Street Bank and Trust or
PFPC, Inc.), contact UBS Global AM via the "ethics hotline" and/or mailbox
referenced below (unless such person believes that using such "ethics hotline"
and/or mailbox would be futile or otherwise undesirable, in which case he or she
should report concerns as directed in the remainder of this sentence); or (2) in
the case of all other persons, contact the Chairperson of the Committee directly
(or in the event of a potential conflict involving such person, any other member
of the Committee).
The Committee requests that each Service Provider promptly inform it of
complaints or concerns received from its employees pursuant to these or any
similar policies it may have if such complaints or concerns are reasonably
believed to relate to accounting, internal accounting controls or auditing
matters or other matters relating to the operations of the Fund.
A-8
The Committee directs UBS Global AM to communicate these policies to its
primary contact(s) at each other Service Provider. Each Service Provider,
including UBS Global AM, shall be directed to make these methods by which
complaints or concerns can be communicated known to its employees who are
primarily involved in accounting, internal accounting controls or auditing
matters or other matters relating to the operations of the Fund that could
reasonably be expected to impact the Fund. If any Service Provider refuses such
request, UBS Global AM shall notify the Committee of the Service Provider's
reasons for non-cooperation, and the Committee shall recommend to the Board such
actions as it believes appropriate.
NON RETALIATION
The Fund prohibits any form of retaliation being taken against any board
member or officer, and shall request that each Service Provider not take any
form of retaliation against its employees, as a result of such person lawfully
engaging in any of the following "Covered Activities":
1. reporting concerns or complaints regarding accounting, internal
accounting controls or auditing matters or other matters relating to
the operations of the Fund; or
2. assisting in an internal or external investigation conducted by the
Fund or a Service Provider regarding such concerns or complaints; or
3. filing, testifying, participating or otherwise assisting in a
criminal or regulatory proceeding relating to the Fund or a Service
Provider.
To the extent possible, the Board shall seek assurances from Service
Providers that they shall not discharge, demote, suspend, threaten, harass, or
in any other manner discriminate against an employee in the terms and conditions
of his or her employment because such employee has made a report of a concern or
complaint or engaged in any other Covered Activities under these policies. In
addition, the Board shall seek assurances from Service Providers that they shall
not knowingly, with the intent to retaliate, take any action harmful to any
employee, including interference with the lawful employment or livelihood of any
person, for providing to a law enforcement officer any truthful information
relating to the commission or possible commission of any crime.
CONFIDENTIALITY
Reasonable efforts will be made to keep a reporting person's identity
confidential. In certain circumstances, however, it may be possible that in the
course of the investigation, facts must be disclosed that would require the
identity of the reporting person to be disclosed. Accordingly, in such
circumstances, it is not possible to give a blanket guarantee of
confidentiality. However, the Committee shall take all reasonable steps (and ask
its Service Providers to make reasonable efforts) to attempt to safeguard the
submission of information on a confidential basis.
A Fund Person or Service Provider employee may submit information
anonymously to the Committee through a letter addressed directly to the Chairman
of the Committee (or in the event of a potential conflict involving such person,
to any other member of the Committee at the Chairman's (or other Committee
member's) address as specified in the Fund's Annual Report to Shareholders. The
Committee recognizes that certain Service Providers have established their own
procedures for the confidential, anonymous receipt of concerns or complaints and
requests that Service Providers promptly report to the Committee any concerns or
complaints relating to the matters discussed herein.
ETHICS HOTLINE & MAILBOX
Where circumstances preclude the use of conventional channels, UBS Global
AM has established an ethics hotline AND a physical mailbox to facilitate the
confidential, anonymous submission of concerns regarding potential
A-9
legal/regulatory violations and questionable accounting or auditing matters or
other matters relating to the operations of a Fund or other ethical dilemmas.
The hotline is available for leaving a voicemail message 24-hours a day, seven
days a week. In order to protect confidentiality, only the UBS Global AM General
Counsel and Chief Compliance Officer will be authorized to retrieve messages.
Please utilize the hotline and the mailbox ONLY for this stated purpose. The
ethics hotline number is 866-237 1851. Written submissions should be addressed
to: UBS Global Asset Management (US) Inc., Attn: ETHICS, 51 West 52nd Street,
New York, NY 10019-6114.
BREACH OF THIS POLICY
Retaliatory conduct which amounts to a breach of this policy could result
in criminal or regulatory sanctions or civil liability or have an adverse effect
on the Fund's or a Service Provider's reputation. As a result, a breach of this
policy may constitute gross misconduct and may result in disciplinary action up
to and including dismissal from service as a board member or officer, or with
respect to a Service Provider, the Board's decision to terminate any Fund
contracts or other relationships with the Service Provider.
RETENTION AND TREATMENT OF INFORMATION REGARDING CONCERNS AND COMPLAINTS
The Committee minutes shall reflect the receipt, retention and treatment
of information received pursuant to this policy. The Committee shall have the
power to obtain the resources it deems necessary and appropriate to investigate
any information regarding such concerns or complaints, including obtaining the
assistance of special counsel, auditors or other advisors or consultants to
assist it in carrying out its responsibilities.
(February 2004)
A-10
EXHIBIT B
NOMINATING COMMITTEE CHARTER
AMENDED AND RESTATED AS OF FEBRUARY 11, 2004
ESTABLISHMENT AND PURPOSE
This document serves as the Charter for the Nominating Committee (the
"Committee") of the Board of each fund (the "Fund") advised by UBS Global Asset
Management (US) Inc. ("UBS Global") listed on Appendix A hereto (each such
Charter being a separate Charter). The primary purposes of the Committee are to
(a) identify individuals qualified to serve as members of the Board of
Directors/Trustees (the "Board") of each Fund; (b) make recommendations to the
Board on the composition of the Board; and (c) recommend committee assignments
and responsibilities to the Board.
COMPOSITION
1. The Committee shall consist of three or more Board members who are
not "interested persons" of the Fund, as that term is defined in
Section 2(a)(19) of the Investment Company Act of 1940, as amended
("1940 Act"), of the Fund (the "Independent Board Members"). Each
member of the Committee must also meet the independence and
experience requirements applicable to closed-end funds as they may
be adopted and modified from time to time by the New York Stock
Exchange (the "NYSE"). Each Committee member shall serve until a
successor to such member is duly elected or qualified or until such
member's resignation or removal from the Board or the Committee.
2. The Committee shall elect a chairperson (the "Chairperson") of the
Committee, who shall preside over Committee meetings.
3. The compensation of the Chairperson and the Committee members shall
be as determined by the Board.
NOMINATION AND APPOINTMENT POLICY
1. The Committee believes that it is in the best interests of the Fund
and its shareholders to obtain highly-qualified candidates to serve
as members of the Board.
2. In nominating candidates, the Committee believes that no specific
qualifications or disqualifications are controlling or paramount, or
that specific qualities or skills are necessary for each candidate
to possess. The Committee shall take into consideration such factors
as it deems appropriate. These factors may include:
o whether or not the person is an "interested person" as defined
in the 1940 Act, meets the independence and experience
requirements of the NYSE cited above and is otherwise
qualified under applicable laws and regulations to serve as a
member of the Board;
o whether or not the person has any relationships that might
impair his or her independence, such as any business,
financial or family relationships with Fund management, the
investment advisor and/or sub-advisors of the Fund, Fund
service providers or their affiliates;
o whether or not the person is willing to serve, and willing and
able to commit the time necessary for the performance of the
duties of a Board member;
o the person's judgment, skill, diversity and experience with
investment companies and other organizations of comparable
purpose, complexity and size and subject to similar legal
restrictions and oversight,
B-1
o the interplay of the candidate's experience with the
experience of other Board members; and
o the extent to which the candidate would be a desirable
addition to the Board and any committees thereof.
3. While the Committee is solely responsible for the selection and
recommendation to the Board of Board candidates, the Committee will
consider nominees recommended by Fund shareholders if a vacancy
occurs among those Board members who are Independent Board Members.
Such recommendations shall be directed to the Secretary of the Fund
at such address as is set forth in the Fund's disclosure documents.
The shareholder's letter should state the nominee's name and should
include the nominee's resume or CURRICULUM VITAE, and must be
accompanied by a written consent of the individual to stand for
election if nominated for the Board and to serve if elected by
shareholders. The Committee may also seek such additional
information about the nominee as it considers appropriate, including
information relating to such nominee that is required to be
disclosed in solicitations or proxies for the election of Board
members.
4. The Committee may from time to time establish specific requirements
and/or additional factors to be considered for Board candidates as
it deems necessary or appropriate.
DUTIES AND RESPONSIBILITIES
1. The Committee shall identify individuals believed to be qualified to
become Board members and recommend to the Board the nominees to
either (i) be elected by the Board or (ii) stand for election as
Board members at the annual or special meeting of shareholders, as
applicable.
2. The Committee shall be responsible for reviewing with the Board the
requisite skills and criteria for new Board members as well as the
composition of the Board as a whole.
3. The Committee shall review, as it deems necessary, and make
recommendations with regard to the tenure of the Board members,
including, as it deems necessary, any term limits and mandatory
retirement age.
4. The Committee shall have the authority to retain and terminate any
search firm to be used to identify Board nominees, subject to the
Board's sole authority to approve the search firm's fees and other
retention terms.
5. The Committee shall have any other duties or responsibilities
expressly delegated to the Committee by the Board from time to time
relating to the nomination of the Board or any committee members.
SUBCOMMITTEES
1. The Committee shall have the authority to delegate all or a portion
of its duties and responsibilities to a subcommittee of the
Committee.
MEETINGS
1. The Committee shall meet at such times as it deems necessary or
appropriate to carry out its duties. Meetings of the Committee may
be held in person, by telephone or by other appropriate means. The
Committee may also take action by unanimous written consent.
2. One-half of the Committee's members shall constitute a quorum, if at
least two members are present. At any meeting of the Committee, the
decision of a majority of the members present and voting shall be
determinative as to any matter submitted to a vote.
B-2
3. The Committee shall keep written minutes of its meetings, which
minutes shall be maintained within the books and records of the
Fund, and the Committee shall report to the Board on its meetings.
4. The Committee shall, from time to time as it deems appropriate,
review and reassess the adequacy of this Charter and recommend any
proposed changes to the Board for approval.
5. The Committee shall have the resources and authority to make
reasonable expenditures, including expenditures to retain any
experts and counsel related to the aforementioned duties and tasks
that will be reimbursed by the Fund.
REPORTING
1. The Chairperson shall report to the Board on the result of the
Committee's deliberations and make such recommendations as deemed
appropriate.
AMENDMENTS
1. This Charter may be amended by a vote of a majority of the Board
members.
B-3
SCHEDULE A
UBS Managed Municipal Trust
UBS Series Trust
UBS Investment Trust
UBS Index Trust
UBS Municipal Money Market Series
UBS Money Series
UBS PACE Select Advisors Trust
UBS Cashfund Inc.
UBS RMA Money Fund Inc.
UBS RMA Tax-Free Fund Inc.
UBS Master Series, Inc.
Strategic Global Income Fund, Inc.
Global High Income Dollar Fund Inc.
Investment Grade Municipal Income Fund Inc.
Insured Municipal Income Fund Inc.
Managed High Yield Plus Fund Inc.
B-4
--------------------------------------------------------------------------------
INSURED
MUNICIPAL
INCOME FUND INC.
================================================================================
PROXY
STATEMENT
--------------------------------------------------------------------------------
INSURED
MUNICIPAL
INCOME FUND INC.
================================================================================
---------------
NOTICE OF
ANNUAL MEETING
TO BE HELD ON
JULY 15, 2004
AND
PROXY STATEMENT
===============
--------------------------------------------------------------------------------
DETACH HERE
COMMON STOCK
PROXY
INSURED MUNICIPAL INCOME FUND INC.
ANNUAL MEETING OF SHAREHOLDERS - JULY 15, 2004
The undersigned hereby appoints as proxies Natasha Kassian and Evelyn De
Simone 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 INSURED 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 8586, Edison, NJ 08818-9452. PFPC Inc.
has been engaged to forward the enclosed proxy material and to tabulate proxies
returned by mail.
----------- -----------
SEE REVERSE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE
SIDE SIDE
----------- -----------
INSURED MUNICIPAL INCOME FUND INC.
Proxy Services
C/O PFPC Inc.
P.O. Box 8586
Edison, NJ 08818-9452
--------------------------------------------------------------------------------
DETACH HERE IF YOU ARE RETURNING YOUR PROXY CARD BY MAIL
PLEASE MARK 4997
|X| VOTES AS IN
THIS EXAMPLE.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
1. To elect as directors:
NOMINEES: (01) Richard Q. Armstrong, (02) David J. Beaubien,
(03) Richard R. Burt, (04) Carl W. Schafer and
(05) William D. White.
FOR WITHHOLD
ALL |_| |_| FROM ALL
NOMINEES NOMINEES
|_|_________________________________________
For all nominees except as written above.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT |_|
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.
Signature:_________________Date:________Signature:_________________Date:________
(if held jointly)
--------------------------------------------------------------------------------
DETACH HERE IF YOU ARE RETURNING YOUR PROXY CARD BY MAIL
APS
PROXY
INSURED MUNICIPAL INCOME FUND INC.
ANNUAL MEETING OF SHAREHOLDERS - JULY 15, 2004
The undersigned hereby appoints as proxies Natasha Kassian and Evelyn De
Simone 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 INSURED 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 8586, Edison, NJ 08818-9452. PFPC Inc.
has been engaged to forward the enclosed proxy material and to tabulate proxies
returned by mail.
----------- -----------
SEE REVERSE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE
SIDE SIDE
----------- -----------
INSURED MUNICIPAL INCOME FUND INC.
Proxy Services
C/O PFPC Inc.
P.O. Box 8586
Edison, NJ 08818-9452
--------------------------------------------------------------------------------
DETACH HERE IF YOU ARE RETURNING YOUR PROXY CARD BY MAIL
PLEASE MARK 4997
|X| VOTES AS IN
THIS EXAMPLE.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
1. To elect as directors:
NOMINEES: (01) Margo N. Alexander, (02) Richard Q. Armstrong,
(03) David J. Beaubien, (04) Richard R. Burt, (05) Meyer Feldberg,
(06) Carl W. Schafer and (07) William D. White.
FOR WITHHOLD
ALL |_| |_| FROM ALL
NOMINEES NOMINEES
|_|_________________________________________
For all nominees except as written above.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT |_|
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.
Signature:_________________Date:________Signature:_________________Date:________
(if held jointly)