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 Materials Pursuant to Section 240.14a-12
ACM 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)(1) 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.
|_| 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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(4) Date Filed:
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Alliance Capital [Logo]
ACM INCOME FUND, INC.
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1345 Avenue of the Americas, New York, New York 10105
Toll Free (800) 221-5672
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
March 20, 2003
To the Stockholders of ACM Income Fund, Inc.:
Notice is hereby given that the Annual Meeting of
Stockholders (the "Meeting") of ACM Income Fund, Inc., a Maryland
corporation (the "Fund"), will be held at the offices of the
Fund, 1345 Avenue of the Americas, 33rd Floor, New York, New
York, on Thursday, March 20, 2003 at 1:00 p.m., Eastern Time, for
the following purposes, all of which are more fully described in
the accompanying Proxy Statement dated February 26, 2003:
1. To elect two Directors of the Fund, each such Director
to hold office for a term of three years and until his
or her successor is duly elected and qualifies;
2. To act upon, if properly presented, a certain
stockholder proposal; and
3. To transact such other business as may properly come
before the Meeting.
The Board of Directors has fixed the close of business
on December 27, 2002 as the record date for the determination of
stockholders entitled to notice of, and to vote at, the Meeting
and any postponement or adjournment thereof. The enclosed proxy
is being solicited on behalf of the Board of Directors of the
Fund. Each stockholder who does not expect to attend the Meeting
in person is requested to complete, date, sign and promptly
return the enclosed proxy card.
By Order of the Board of Directors,
Edmund P. Bergan, Jr.
Secretary
New York, New York
February 26, 2003
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YOUR VOTE IS IMPORTANT
Please indicate your voting instructions on the
enclosed proxy card, sign and date it, and return it in the
envelope provided, which needs no postage if mailed in the United
States. Your vote is very important no matter how many shares you
own. Please mark and mail your proxy promptly in order to save
the Fund any additional expense of further proxy solicitation and
in order for the Meeting to be held as scheduled.
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(R) This registered service mark used under license from the
owner, Alliance Capital Management L.P.
PROXY STATEMENT
ACM INCOME FUND, INC.
1345 Avenue of the Americas
New York, New York 10105
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ANNUAL MEETING OF STOCKHOLDERS
March 20, 2003
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INTRODUCTION
This Proxy Statement is furnished in connection with
the solicitation of proxies on behalf of the Board of Directors
of ACM Income Fund, Inc., a Maryland corporation (the "Fund"), to
be voted at the Annual Meeting of Stockholders of the Fund (the
"Meeting") to be held at the offices of the Fund, 1345 Avenue of
the Americas, 33rd Floor, New York, New York 10105, on Thursday,
March 20, 2003 at 1:00 p.m., Eastern Time. The solicitation will
be by mail and the cost will be borne by the Fund. The Notice of
Meeting, this Proxy Statement and the accompanying proxy card are
being mailed to stockholders on or about February 26, 2003.
The Board of Directors has fixed the close of business
on December 27, 2002 as the record date for the determination of
stockholders entitled to notice of, and to vote at, the Meeting
and at any postponement or adjournment thereof (the "Record
Date"). The outstanding voting shares of the Fund as of the
Record Date consisted of 225,724,280 shares of common stock,
each share being entitled to one vote on each matter to come
before the Meeting. All properly executed and timely received
proxies will be voted at the Meeting in accordance with the
instructions marked thereon or otherwise provided therein.
Accordingly, unless instructions to the contrary are marked,
proxies will be voted for the election of two Directors and
against the stockholder proposal as described herein, if
presented. Any stockholder may revoke his or her proxy at any
time prior to the exercise thereof by giving written notice to
the Secretary of the Fund at 1345 Avenue of the Americas, New
York, New York 10105, by signing another proxy as of a later date
or by personally voting at the Meeting.
Properly executed proxies may be returned with instructions
to abstain from voting or to withhold authority to vote (an
"abstention") or may represent a broker "non-vote" (which is a
proxy from a broker or nominee indicating that the broker or
nominee has not received instructions from the beneficial owner
or other person entitled to vote the shares on a particular
matter with respect to which the broker or nominee does not have
discretionary power to vote). The shares represented by
abstentions or broker non-votes will be considered present for
purposes of determining the existence of a quorum for the
transaction of business but, not being votes cast, will have no
effect on the outcome of proposals which require the affirmative
vote of a majority or plurality of votes cast at the meeting. If
any matter other than those mentioned above properly comes before
the Meeting, the shares represented by proxies will be voted on
all such proposals in the discretion of the person, or persons,
holding the proxies.
A quorum for the Meeting will consist of the presence
in person or by proxy of the holders of a majority of the shares
entitled to vote at the Meeting. Whether or not a quorum is
present at the Meeting, if sufficient votes in favor of the
position recommended by the Board of Directors on any proposal
described in the Proxy Statement are not timely received, the
persons named as proxies may, but are under no obligation to,
with no other notice than announcement at the Meeting, propose
and vote for one or more adjournments of the Meeting in order to
permit further solicitation of proxies. The Meeting may be
adjourned with respect to fewer than all of the proposals, and a
stockholder vote may be taken on any one or more of the proposals
prior to any adjournment if sufficient votes have been received
for approval thereof. Shares represented by proxies indicating a
vote contrary to the position recommended by the Board of
Directors on a proposal will be voted against adjournment of the
Meeting as to that proposal.
The Fund will bear the cost of this Proxy Statement.
The Fund has engaged Georgeson Shareholder Communications
Corporation ("GSCC"), 17 State Street, New York, New York 10004,
to assist the Fund in soliciting proxies for the Meeting. The
Fund will pay GSCC a fee of $15,000 for its services plus
reimbursement of out-of-pocket expenses.
ELECTION OF DIRECTORS
At the Meeting, two Directors will be elected to serve
for terms of three years, and in each case, until his or her
successor is duly elected and qualifies. The affirmative vote of
a plurality of the votes cast at the Meeting is required to elect
a Director. It is the intention of the persons named in the
accompanying proxy card to nominate and vote in favor of the
election of the nominees listed below.
Pursuant to the Fund's Bylaws, the Board of Directors
is divided into three classes. Subject in each case to the
election and qualification of any successors, the terms of the
members of Class Three will expire as of the Meeting, the terms
of the members of Class One will expire as of the annual meeting
of stockholders for the year 2004, and the terms of the members
of Class Two will expire as of the annual meeting of stockholders
for the year 2005. Upon expiration of the terms of the members of
a class as set forth above, the terms of their successors in that
class will continue until the third annual meeting of
stockholders following the election of such Directors and until
their successors are duly elected and qualify. Messrs. John H.
Dobkin, Clifford L. Michel and Donald J. Robinson are currently
the Directors constituting Class One; Messrs. David H. Dievler
and William H. Foulk, Jr. and Dr. James M. Hester are currently
the Directors constituting Class Two; and Mr. John D. Carifa and
Ms. Ruth Block are currently the Directors constituting Class
Three.
Under the Board's classified structure, only those
Directors in a single class may be replaced in any one year. It
would require two years for the stockholders to replace a
majority of the Board of Directors, although Maryland law
provides that stockholders may remove Directors under certain
circumstances even if they are not then standing for re-election,
and, under regulations of the Securities and Exchange Commission
(the "Commission"), appropriate stockholder proposals may be
included in the Fund's annual proxy statement. This classified
Board structure, which may be regarded as an "anti-takeover"
provision, may make it more difficult for the Fund's stockholders
to change the majority of Directors and, thus, has the effect of
maintaining the continuity of management.
The Board of Directors has nominated each of Mr. John
D. Carifa and Ms. Ruth Block for election as a Director of Class
Three. Each nominee has consented to serve as a Director. The
Board of Directors knows of no reason why either of these
nominees would be unable to serve, but in the event either
nominee is unable to serve or for good cause will not serve, the
proxies received indicating a vote in favor of such nominee will
be voted for a substitute nominee as the Board of Directors may
recommend.
Certain information concerning the Fund's Directors,
including the nominees for election as Directors, is set forth
below.
Number of Other
Portfolios Directorships
Year Term in Held by
as a Fund Complex Director or
Director Years of Principal Occupation(s), Including Overseen by Nominee
Name, Address and Age Will Expire Service* Directorships Held, During Past 5 Years Director
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INTERESTED DIRECTOR**
John D. Carifa, 57 Class 16 President, Chief Operating Officer and 114 None
1345 Avenue of the Americas, Three a Director of Alliance Capital
New York, NY 10105 (2006++) Management Corporation ("ACMC"), with
which he has been associated since
Chairman of the Board prior to 1998.
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DISINTERESTED DIRECTORS
Ruth Block +, 72 Class Three 16 Formerly an Executive Vice President 93 None
P.O. Box 4623 (2006++) and the Chief Insurance Officer of The
Stamford, CT 06903 Equitable Life Assurance Society of the
United States; Chairman and Chief
Executive Officer of Evlico; and a
Director of Avon, BP Amoco Corporation
(oil and gas), Ecolab, Inc. (specialty
chemicals), Tandem Financial Group and
Donaldson, Lufkin & Jenrette Securities
Corporation.
David H. Dievler +, 73 Class Two 16 Independent Consultant. Until December 98 None
P.O. Box 167 (2005) 1994 he was Senior Vice President of
Spring Lake, NJ 07762 ACMC responsible for mutual fund
administration. Prior to joining ACMC in
1984 he was Chief Financial Officer of
Eberstadt Asset Management since 1968.
Prior to that he was Senior Manager at
Price Waterhouse & Co. Member of
American Institute of Certified Public
Accountants since 1953.
John H. Dobkin +, 60 Class One 16 Consultant. He was formerly a Senior 94 None
P.O. Box 12 (2004) Advisor from June 1999 - June 2000 and
Annandale, NY 12504 President (December 1989 - May 1999) of
Historic Hudson Valley (historic
preservation). Previously, Director
of the National Academy of Design.
During 1988-92, he was Director and
Chairman of the Audit Committee of ACMC.
William H. Foulk, Jr. +, 70 Class Two 5 Investment Adviser and Independent 110 None
2 Sound View Drive (2005) Consultant. He was formerly Senior
Suite 100 Manager of Barrett Associates, Inc., a
Greenwich, CT 06830 registered investment adviser, with
which he had been associated since prior
to 1998. He was formerly Deputy
Comptroller of the State of New York
and, prior thereto, Chief Investment
Officer of the New York Bank for
Savings.
Dr. James M. Hester +, 78 Class Two 16 President of The Harry Frank Guggenheim 11 None
25 Cleveland Lane (2005) Foundation, with which he has been
Princeton, NJ 08540 associated since prior to 1998.
Formerly President of New York
University and the New York Botanical
Garden. Formerly Rector of the United
Nations University and Vice Chairman of
the Board of the Federal Reserve Bank of
New York.
Clifford L. Michel +, 63 Class One 16 Senior Counsel of the law firm of 93 Placer Dome
15 St. Bernard's Road (2004) Cahill Gordon & Reindel since February Inc.
Gladstone, NJ 07934 2001 and a partner of that firm for
more than 25 years prior thereto. He
is President and Chief Executive
Officer of Wenonah Development Company
(investments) and a
Director of Placer Dome
Inc. (mining).
Donald J. Robinson +, 68 Class One 8 Senior Counsel to the law firm of 92 None
98 Hell's Peak Road (2004) Orrick, Herrington & Sutcliffe LLP
Weston, VT 05161 since prior to 1998. Formerly a senior
partner and a member of the Executive
Committee of that firm. He was also a
Member and Chairman of the Municipal
Securities Rulemaking Board and a
Trustee of the Museum of the City of New
York.
* "Years of Service" refers to the total number of years the
Director has served as a Director.
** "Interested person," as defined in the Investment Company
Act of 1940 (the "1940 Act"), of the Fund because of an
affiliation with the Fund's investment adviser, Alliance
Capital Management L.P. (the "Adviser").
+ Member of the Audit Committee and Nominating Committee of
the Board of Directors of the Fund.
++ If re-elected at the Meeting.
It is the policy of the Boards of Directors of all
registered investment companies to which the Adviser provides
investment advisory services, including the Fund (collectively,
the "Alliance Fund Complex"), that each Director will invest
specified minimum amounts, and (in the case of most of the
Directors of the Fund) an overall total of at least $150,000, in
shares of investment companies in the Alliance Fund Complex.
The dollar range of the Fund's securities owned by each
Director and the aggregate dollar range of securities owned in
the Alliance Fund Complex is set forth below.
Aggregate Dollar Range of Equity Securities in
Dollar Range of Equity Securities of all Funds in the Alliance Fund Complex as of
the Fund as of December 31, 2002 December 31, 2002
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INTERESTED DIRECTOR
John D. Carifa $10,001-$50,000 Over $100,000
DISINTERESTED DIRECTORS
Ruth Block $10,001-$50,000 Over $100,000
David H. Dievler $10,001-$50,000 Over $100,000
John H. Dobkin None Over $100,000
William H. Foulk, Jr. $10,001 - $50,000 Over $100,000
Dr. James M. Hester $10,001 - $50,000 Over $100,000
Clifford L. Michel $10,001 - $50,000 Over $100,000
Donald J. Robinson None Over $100,000
As of December 31, 2002, the Directors and officers of
the Fund as a group owned less than 1% of the shares of the
Fund. During the Fund's most recently completed fiscal year, the
Fund's Directors as a group did not engage in the purchase or
sale of securities of the Adviser or of any of its parents or
subsidiaries in an amount exceeding 1% of the relevant class of
securities.
During the fiscal year ended December 31, 2002, the
Board of Directors met 9 times, the Audit Committee met 2
times and the Nominating Committee did not meet. Both the
Audit Committee and the Nominating Committee are standing
committees of the Board. The Nominating Committee was constituted
for the purpose of selecting and nominating persons to fill any
vacancies on the Board of Directors. The Nominating Committee
does not consider for nomination candidates recommended by
stockholders. The Fund does not have a Compensation Committee.
In accordance with the listing standards of the New
York Stock Exchange, the members of the Audit Committee are
independent as defined in Section 303.01(B)(2)(a) and (3) of the
New York Stock Exchange Listed Company Manual.
The Fund does not pay any fees to, or reimburse
expenses of, any Director during a time when the Director is
considered an "interested person" of the Fund, as defined in the
1940 Act. The aggregate compensation paid by the Fund to each of
the Directors during its fiscal year ended December 31, 2002, the
aggregate compensation paid to each of the Directors during the
Fund's fiscal year 2002 by the Alliance Fund Complex and the
total number of funds in the Alliance Fund Complex with respect
to which each of the Directors serves as a director or trustee
are set forth below. Neither the Fund nor any other investment
company in the Alliance Fund Complex provides compensation in the
form of pension or retirement benefits to any of its directors or
trustees.
Number of Number of
Investment Investment
Companies in the Portfolios within
Alliance Fund the Alliance Fund
Compensation from Complex, including Complex, including
the Alliance Fund the Fund, as to the Fund, as to
Compensation from Complex, including which the Director which the Director
the Fund during its the Fund, during is a Director or is a Director or
Name of Director Fiscal Year 2002 Trustee Trustee
-------------------------------- --------------------- --------------------- --------------------- -------------------
INTERESTED DIRECTOR
John D. Carifa $-0- $-0- 53 114
DISINTERESTED DIRECTORS
Ruth Block $4,340 $192,600 43 93
David H. Dievler $4,340 $246,238 48 98
John H. Dobkin $4,340 $217,888 45 94
William H. Foulk, Jr. $4,340 $241,700 49 110
Dr. James M. Hester $8,680 $91,250 11 11
Clifford L. Michel $4,340 $201,950 44 93
Donald J. Robinson $4,340 $193,100 43 92
Officer Information
Certain information concerning the Fund's officers is set
forth below. The Fund's officers are elected annually by the
Board of Directors to serve until his or her successor is duly
elected and qualifies.
Position(s) - (Month and Year Principal Occupation during the past
Name, Address and Age* First Elected) 5 years
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John D. Carifa (57) Chairman of the Board (12/94) See Biography above.
Kathleen A. Corbert (42) Senior Vice President (4/96) An Executive Vice President of
ACMC,** with which she has been
associated since prior to 1998.
Andrew M. Aran (45) Vice President (8/02) A Senior Vice President of ACMC,**
with which he has been associated
since prior to 1998.
Paul J. DeNoon (40) Vice President (3/93) A Senior Vice President of ACMC,**
with which he has been associated
since prior to 1998.
Sean Kelleher (41) Vice President (8/02) A Senior Vice President of ACMC**
with which he has been associasted
since 1999. Previously, a manager
of the MBS swaps desk at Deutsche
Bank since prior to 1998.
Michael L. Mon (33) Vice President (4/00) A Vice President of ACMC,** with
which he has been associated since
June 1999. Prior thereto, he was a
portfolio manager at Brundage, Story
and Rose since prior to 1998.
Douglas J. Peebles (37) Vice President (8/02) A Senior Vice President of ACMC,**
with which he has been associated
since prior to 1998.
Michael A. Snyder (40) Vice President (8/02) A Senior Vice President of ACMC**
since May 2001. Previously he was a
Managing Director in the high yield
asset management group at Donaldson,
Lufkin & Jenrette Corporation from
1998 to 2001, and a Managing
Director at Bear Stearns & Co. since
prior to 1998.
Edmund P. Bergan, Jr. (52) Secretary (2/94) A Senior Vice President and the
General Counsel of Alliance Fund
Distributors, Inc.** ("AFD") and
Alliance Global Investor Services,
Inc.** ("AGIS") since prior to 1998.
Mark D. Gersten (52) Treasurer and Chief Financial A Senior Vice President of AGIS**
c/o Alliance Global Investor Officer (2/94) and Vice President of AFD,** with
Services, Inc. which he has been associated since
500 Plaza Drive prior to 1998.
Secaucus, NJ 07094
Vincent S. Noto (38) Controller (4/01) A Vice President of AGIS,** with
c/o Alliance Global Investor which he has been associated since
Services, Inc. prior to 1998.
500 Plaza Drive
Secaucus, NJ 07094
* The address for each of the Fund's officers is 1345 Avenue
of the Americas, New York, New York 10105, unless otherwise
noted.
** An affiliate of the Fund.
Audit Committee Report
The Fund's Board of Directors has adopted a written
charter for the Audit Committee. The purposes of the Fund's Audit
Committee are set forth in the Fund's Audit Committee Charter.
The role of the Audit Committee is to assist the Board of
Directors in its oversight of the Fund's financial reporting
process. As set forth in the Audit Committee Charter, management
of the Fund is responsible for the preparation, presentation and
integrity of the Fund's financial statements, the Fund's
accounting and financial reporting principles and internal
controls and procedures designed to assure compliance with
accounting standards and applicable laws and regulations. The
independent accountants are responsible for auditing the Fund's
financial statements and expressing an opinion as to their
conformity with generally accepted accounting principles.
The Audit Committee of the Board of Directors will
normally meet three times during each full fiscal year with
representatives of the independent accountants to discuss and
review various matters as contemplated by the Audit Committee
Charter. In the performance of its oversight function, the Audit
Committee of the Fund has considered and discussed the audited
financial statements with management and Ernst & Young, the
Fund's independent auditor ("independent accountants" for
purposes of this discussion). The Audit Committee has also
discussed with the independent accountants the matters required
to be discussed by Statement on Auditing Standards No. 61,
Communication with Audit Committees, as currently in effect. The
Audit Committee also considered whether the provision by the
Fund's independent accountants of non-audit services to the Fund,
and of professional services to the Adviser and affiliates of the
Adviser that provide services to the Fund, is compatible with
maintaining the independent accountants' independence. Finally,
the Audit Committee has received the written disclosures and the
letter from the independent accountants required by Independence
Standards Board Standard No. 1, Independence Discussions with
Audit Committees, as currently in effect, and has discussed with
the independent accountants their independence.
The members of the Audit Committee are not
professionally engaged in the practice of auditing or accounting
and are not experts in the fields of auditing or accounting,
including in respect of auditor independence. Members of the
Audit Committee rely without independent verification on the
information provided to them and on the representations made by
management and the independent accountants. Accordingly, the
Audit Committee's oversight does not provide an independent basis
to determine that management has maintained appropriate
accounting and financial reporting principles or appropriate
internal controls and procedures designed to assure compliance
with accounting standards and applicable laws and regulations.
Furthermore, the Audit Committee's considerations and discussions
referred to above do not assure that the audits of the Fund's
financial statements have been carried out in accordance with
generally accepted auditing standards, that the financial
statements are presented in accordance with generally accepted
accounting principles or that the Fund's accountants are in fact
"independent".
Based upon the reports and discussions described in
this report, and subject to the limitations on the role and
responsibilities of the Audit Committee referred to above and in
the Audit Committee Charter, the Audit Committee recommended to
the Board of Directors of the Fund that the audited financial
statements of the Fund be included in the Fund's annual report to
stockholders for the most recent fiscal period.
Submitted by the Audit Committee of the Board of Directors
Ruth Block Dr. James M. Hester
David H. Dievler Clifford L. Michel
John H. Dobkin Donald J. Robinson
William H. Foulk, Jr.
Independent Auditors
The Board of Directors of the Fund at a meeting held on
October 23, 2002, approved by the vote cast in person of a
majority of the Directors of the Fund, including a majority of
the Directors who are not "interested persons" of the Fund, as
defined in the 1940 Act, Ernst & Young LLP, independent auditors
to audit the accounts of the Fund for the fiscal year ending
December 31, 2003. In reliance on Rule 32a-4 under the 1940 Act,
the Fund is not seeking stockholder ratification of the selection
of its independent auditors. Representatives of Ernst & Young
LLP are expected to be present at the Meeting and to have the
opportunity to make a statement and respond to appropriate
questions from the stockholders.
Ernst & Young LLP has audited the accounts of the Fund
since the date of its commencement of operations, and has
represented that it does not have any direct financial interest
or any material indirect financial interest in the Fund.
Independent Auditor's Fees
The following table sets forth the aggregate fees
billed by the independent auditors for the Fund's most recent
fiscal year for professional services rendered for: (i) the audit
of the Fund's annual financial statements and the review of
financial statements included in the Fund's reports to
stockholders; (ii) financial information systems design and
implementation services provided to the Fund, the Adviser and
entities that control, are controlled by or under common control
with the Adviser that provide services to the Fund; (iii) all
other services provided to the Fund; and (iv) all other services
provided to the Adviser and entities that control, are controlled
by or under common control with the Adviser that provide services
to the Fund ("Adviser Affiliates").
All All Other Fees
Financial Information Other Fees for Services Provided
Systems Design and For Services to the Adviser and
Audit Fees Implementation Fees Provided to the Fund Adviser Affiliates
-------------------------------------------------------------------------------------------
$48,000 $0 $28,746 $417,000
The Board of Directors unanimously recommends that the
stockholders vote FOR the election of each of the foregoing
nominees to serve as a Director of the Fund.
STOCKHOLDER PROPOSAL RECOMMENDING TERMINATION OF THE
INVESTMENT MANAGEMENT AGREEMENT AND OTHER ACTIONS
An owner (the "proponent") of shares of the Fund has
informed the Fund that he intends to present the proposal set
forth below for action at the Meeting. The proponent's name and
address will be furnished upon request by the Secretary of the
Fund. The proponent has stated to the Fund that he personally
owns 311.8135 shares of the Fund in a "Charles Schwab account",
with a market value of at least $2,000, and that this ownership
qualifies him to have his proposal included in this Proxy
Statement. If properly presented at the meeting, adoption of this
proposal requires the affirmative vote of a majority of the votes
cast at the Meeting.
PROPONENT'S PROPOSAL
Resolved, that the shareholders of the ACM Income Fund, Inc.,
assembled in annual meeting in person and by proxy, recommend
that the board of directors terminate the investment advisory
agreement between ACM Income Fund and Alliance Capital
Management, L.P. (The advisor) when the current agreement
expires, and at such time solicit offers from selected investment
advisors, including Alliance Capital Management, L.P., to
evaluate the cost and the ability of the candidates to perform
for the benefit of the shareholders.
At the same time, the board should make a comprehensive study of
the cost of operating this Fund with a view to reducing
compensation to any future fund manager.
In addition, the board should evaluate all proposals such as the
rights offering dated November 16, 2001 to insure that in the
future, the current shareholders are not adversely affected by
any such proposal.
SUPPORTING STATEMENT
On November 16, 2001, the company sent a prospectus on an
offering which essentially offered the present shareholders the
opportunity to purchase one share of newly issued stock for each
three shares held. The price for these shares turned out to be
$7.03 per share. The NAV price on 12/21/01 was $8.26. The market
price was $7.41. On 12/28/01 the NAV price dropped to $7.79, a
loss of 47(cent) per share. Most of that, I am sure, can be
attributed to the cost of making this offering.
On page 5 under "Risk Factors of the Offering," it is stated "You
will incur immediate dilution as a result of this offering, which
dilution could be substantial." It goes on to say dilution would
be greater if you did not exercise your rights.
As a result of this offering, the company will benefit because
more shares being outstanding will mean more management fees.
Will the management fees be reduced? There is no indication of
that. We, the shareholders pay, the management benefits.
In the year 2000, the assets of the fund jumped from $448,735,000
on December 31, 1999 to $1,390,592,000 on December 31, 2000.
Certain synergies must have taken place, but management costs
remained at about 1.19 percent of the assets.
The following is an excerpt from the June 20, 2000 Wall Street
Journal, quoting Mr. John C. Bogle, former Chairman of the
Vangard Funds.
The Investment Act of 1940 warns against organizing,
operating, and managing funds in the interests of the
investment advisors rather than in the interest of the
shareholders, but that warning is not adequately heeded
today. It is high time funds managers and independent
directors as well as public officials, the media and
the shareholders give these issues the attention they
deserve.
A yes vote on this proposal will convey to the directors that
they should exercise their moral and fiduciary responsibilities
to protect the shareholders of the fund by judiciously
scrutinizing every expense and every proposal recommended by the
management of the fund. Please vote yes on this proposal.
Your Board of Directors unanimously opposes this stockholder
proposal.
OPPOSING STATEMENT OF THE FUND
The Adviser is responsible for the Fund's historically
good performance and its current superior yield. The Fund's
current yield is among the highest of any closed-end
fund that invests primarily in government securities. In
addition, the Fund's total investment return based on net asset
value for the 3 year period ended November 30, 2002 was 11.28%
compared with the Lehman Brothers Aggregate Bond Index return of
9.18% for the same period. The Adviser is a leading investment
management firm and is one of the largest mutual fund sponsors,
with a diverse family of globally distributed mutual fund
portfolios. Termination of the Fund's investment advisory
agreement with the Adviser (the "Advisory Agreement") would sever
the Fund's relationship with the Adviser, thus disrupting the
Fund's investment program, necessitating extraordinary
expenditures and creating a period of uncertainty that could
substantially harm your investment.
If the Advisory Agreement were terminated, the Fund
would immediately lose the Adviser's services. If the Fund were
to lose the Adviser's services, the Fund's investment program
would be completely disrupted. Termination of the Advisory
Agreement would likely lead to increased price volatility and
could reduce or eliminate the current market premium. The Fund's
market price would most likely be adversely affected. Moreover,
it would be expensive and time-consuming to find a replacement
investment adviser for the Fund, and these costs would be borne
by the Fund. A new agreement with any adviser would require
stockholder approval, which could only occur months after
termination of the Advisory Agreement, and after considerable
additional stockholder expense. During this time, your investment
in the Fund could be substantially harmed and there is no
guarantee that a new adviser would be able to deliver the high
yield which the Fund now provides to its stockholders.
The Board of Directors (the "Board") regularly
evaluates all costs of operating the Fund, including compensation
to the Adviser for its services. Your Board has determined, after
careful deliberation, that the Fund's current advisory
relationship with the Adviser is in the best interests of the
Fund and its stockholders. In its review of the Fund's advisory
relationship with the Adviser, the Board considered all
information it deemed reasonably necessary to evaluate the terms
of the Advisory Agreement. The principal areas of review were the
nature and quality of the services provided by the Adviser and
the reasonableness of the fees charged for those services. The
Board also considered the Fund's performance, including the yield
generated by the Fund's investment portfolio. In evaluating the
Fund's advisory fees, the Board took into account not only the
level of fees but also the demands, complexity and quality of the
investment management of the Fund and the business reputation and
financial resources of the Adviser. The Board concluded in light
of a weighing and balancing of all factors, including the fees
charged for services under the Advisory Agreement and the Fund's
performance, that it was in the best interests of the Fund and
its stockholders to continue the Fund's relationship with the
Adviser.
On October 4, 2001, the Board approved a rights
offering for the Fund (the "Rights Offering") after determining
that it was in the best interests of the Fund and its then
existing stockholders to increase the Fund's assets available for
investment, thereby allowing the Fund to take advantage of
investment opportunities. In making its determination, the Board
was advised by the Adviser that the availability of new capital
would permit the Fund to take advantage of investment
opportunities without being required to sell current portfolio
positions that it desired to retain. The Board also took into
account that a well-subscribed rights offering could result in an
improvement in the liquidity of the trading market for the Fund's
shares on the New York Stock Exchange and that the Rights
Offering would give existing stockholders the opportunity to
purchase shares of the Fund at a price below the then current
market price and net asset value per share and might increase the
level of market interest in the Fund. The Board based its
determination solely on the potential benefits to the Fund and
its stockholders and not on any potential benefits to the
Adviser. In approving the Rights Offering, the Board also
carefully considered the proposed terms and expenses of the
Rights Offering and its dilutive effect on exercising and
non-exercising stockholders. The potential benefits and potential
risks to the Fund's stockholders were clearly disclosed in the
prospectus for the Rights Offering. Potential benefits to the
Adviser, including increased management fees as a result of the
proceeds and increased income from the Rights Offering, were also
clearly disclosed to stockholders in the prospectus.
While it is true that the management fees paid to the
Adviser did increase as a result of the proceeds and increased
income from the Rights Offering, the Rights Offering did, in
fact, provide a substantial benefit to the Fund's stockholders.
The dividend per share payable by the Fund increased from $0.07
in the month prior to the Rights Offering to $0.0825 in February
2002 following the Adviser's investment of the proceeds of the
Rights Offering. This $0.0825 dividend rate remained until
February 25, 2003 when the dividend was decreased to $0.0725.
Based on the Fund's net asset value as of February 13, 2003, and
assuming the new dividend rate of $0.0725, the Fund's yield would
be 11.01%. In addition to the increase in the dividend, since the
conclusion of the Rights Offering the market price of the Fund's
shares has risen substantially from $7.41 on December 21, 2001 to
$8.38 on February 13, 2003, and the Fund has generally traded at
a significant premium to net asset value. Immediately prior to
the announcement of the Rights Offering on October 3, 2001, the
market premium on the Fund's shares was 4.18%. As of February 13,
2003, the premium on the Fund's shares was 6.08%.
The Board believes that termination of the Fund's
investment management agreement with Alliance is not in the best
interests of the Fund and its stockholders and, therefore, the
Board strongly and unanimously opposes the stockholder proposal.
Your Board of Directors unanimously recommends that you
vote AGAINST this stockholder proposal.
INFORMATION CONCERNING THE FUND'S
INVESTMENT ADVISER AND ADMINISTRATOR
The Fund's investment adviser is Alliance Capital
Management L.P., with principal offices at 1345 Avenue of the
Americas, New York, New York 10105. The Fund's administrator is
UBS Global Asset Management, with principal offices at 51 West
52nd Street, New York, New York 10019.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 30(h) of the 1940 Act and the rules under
Section 16 of the Securities Exchange Act of 1934 require that
the Directors and officers of the Fund and the Directors of ACMC,
among others, file with the Commission and the New York Stock
Exchange initial reports of ownership and reports of changes in
ownership of shares of the Fund. For the fiscal year ended
December 31, 2002, all such reports were timely filed.
OTHER MATTERS
Management of the Fund does not know of any matters
properly to be presented at the Meeting other than those
mentioned in this Proxy Statement. If any such matters properly
come before the Meeting, the shares represented by proxies will
be voted with respect thereto in the discretion of the person or
persons holding the proxies.
STOCKHOLDER PROPOSALS FOR THE NEXT
ANNUAL MEETING OF STOCKHOLDERS
Proposals of stockholders intended to be presented at
the next annual meeting of stockholders of the Fund must be
received by the Fund by October 29, 2003 for inclusion in the
Fund's proxy statement and proxy card relating to that meeting.
The submission by a stockholder of a proposal for inclusion in
the proxy statement does not guarantee that it will be included.
Stockholder proposals are subject to certain requirements under
the federal securities laws and the Maryland General Corporation
Law and must be submitted in accordance with the Fund's Bylaws.
The persons named as proxies for the 2004 Annual
Meeting of Stockholders will, with respect to proxies in effect
at that meeting, have discretionary authority to vote on any
matter presented by a stockholder for action at that meeting
unless the Fund receives notice of the matter by January 10, 2003
(or such earlier date as may be specified in an advance notice
provision, if any, in the Fund's Bylaws). If the Fund receives
such timely notice, these persons will not have this authority
except as provided in the applicable rules of the Commission.
REPORTS TO STOCKHOLDERS
The Fund will furnish each person to whom this Proxy
Statement is delivered with a copy of the Fund's latest annual
report to stockholders upon request and without charge. To
request a copy, please call Alliance Global Investor Services,
Inc. at (800) 227-4618 or contact Gary Beckham at Alliance
Capital Management L.P., 1345 Avenue of the Americas, New York,
New York 10105.
By Order of the Board of Directors,
Edmund P. Bergan, Jr.
Secretary
February 26, 2003
New York, New York
TABLE OF CONTENTS
Page
INTRODUCTION....................................................1
ELECTION OF DIRECTORS...........................................2
STOCKHOLDER PROPOSAL RECOMMENDING TERMINATION OF THE
INVESTMENT MANAGEMENT AGREEMENT AND OTHER ACTIONS..............11
INFORMATION CONCERNING THE FUND'S INVESTMENT ADVISER AND
ADMINISTRATOR..................................................14
OTHER MATTERS..................................................15
STOCKHOLDER PROPOSALS FOR THE NEXT ANNUAL MEETING OF
STOCKHOLDERS...................................................15
REPORTS TO STOCKHOLDERS........................................15
ACM Income Fund, Inc.
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[LOGO OF ALLIANCE CAPITAL]
Alliance Capital Management L.P.
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NOTICE OF ANNUAL MEETING
OF STOCKHOLDERS AND
PROXY STATEMENT
February 26, 2003
Appendix A
PROXY ACM INCOME FUND, INC. PROXY
PROXY IN CONNECTION WITH THE ANNUAL MEETING OF
STOCKHOLDERS TO BE HELD ON MARCH 20, 2003
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF THE FUND.
The undersigned stockholder of ACM Income Fund, Inc., a
Maryland corporation (the "Fund"), hereby appoints Carol H. Rappa
and Christina A. Santiago, or either of them, as proxies for the
undersigned, each with full power of substitution, to attend the
Annual Meeting of Stockholders of the Fund (the "Annual Meeting")
to be held at 1:00 p.m., Eastern Time, on March 20, 2003, at the
offices of the Fund, 1345 Avenue of the Americas, 33rd Floor, New
York, New York 10105, and any postponement or adjournment
thereof, to cast on behalf of the undersigned all votes that the
undersigned is entitled to cast at the Annual Meeting and
otherwise to represent the undersigned at the Annual Meeting with
all powers possessed by the undersigned if personally present at
such Annual Meeting. The undersigned hereby acknowledges receipt
of the Notice of Annual Meeting and accompanying Proxy Statement,
revokes any proxy heretofore given with respect to such Annual
Meeting and hereby instructs said proxies to vote said shares as
indicated on the reverse side hereof.
The Board of Directors knows of no reason why any of the
nominees for the Board of Directors would be unable to serve, but
in the event any nominee is unable to serve or for good cause
will not serve, the proxies received indicating a vote in favor
of such nominee will be voted for a substitute nominee as the
Board of Directors may recommend.
Please refer to the Proxy Statement for
a discussion of each of the Proposals.
IF THIS PROXY IS PROPERLY EXECUTED, THE VOTES ENTITLED TO BE
CAST BY THE UNDERSIGNED WILL BE CAST AS INSTRUCTED ON THE REVERSE
SIDE HEREOF. IF THIS PROXY IS PROPERLY EXECUTED BUT NO
INSTRUCTION IS GIVEN, THE VOTES ENTITLED TO BE CAST BY THE
UNDERSIGNED WILL BE CAST "FOR" THE ELECTION OF EACH NOMINEE FOR
DIRECTOR, "AGAINST" THE STOCKHOLDER PROPOSAL AS DESCRIBED IN THE
PROXY STATEMENT FOR THE ANNUAL MEETING, IF PROPERLY PRESENTED,
AND IN THE DISCRETION OF THE PROXY HOLDERS(S) ON ANY OTHER MATTERS
THAT MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY
ADJOURNMENT OR POSTPONEMENT THEREOF.
Please sign this proxy exactly as your name(s) appear(s) on the
records of the Fund. Joint owners should each sign personally.
Trustees and other representatives should indicate the capacity
in which they sign, and where more than one name appears, a
majority must sign. If a corporation or another entity, the
signature should be that of an authorized officer who should
state his or her full title.
PLEASE VOTE, DATE AND SIGN ON THE REVERSE SIDE HEREOF AND RETURN
THIS PROXY CARD PROMPTLY. YOU MAY USE THE ENCLOSED ENVELOPE.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
----------------------------------- -----------------------------------
----------------------------------- -----------------------------------
----------------------------------- -----------------------------------
ACM INCOME FUND, INC.
Please mark votes as in this example: /x/
Your Board of Directors urges you to vote "FOR" the election of all Nominees.
Withhold
For All From All
1. Election of Directors Nominees Nominees
Class Three Directors |_| |_|
(terms expire 2006).
Mr. John D. Carifa
Ms. Ruth Block |_| __________________________
For all nominees except as
noted above.
NOTE: If you do not wish your shares voted "FOR" a particular
Nominee, mark the "For All Except" box and strike a line
through the name(s) of such Nominee(s). Your shares will
be voted for the remaining Nominee(s).
Your Board of Directors urges you to vote "Against" this
stockholder proposal.
2. To approve, if properly presented, For Against Abstain
a stockholder proposal as
described in the Proxy |_| |_| |_|
Statement for the Annual
Meeting
3. To vote and otherwise represent the undersigned on any other
matter that may properly come before the meeting or any
adjournment or postponement thereof in the discretion of the
Proxy holder(s), all as more fully described in the
accompanying Proxy Statement.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT / /
Please be sure to sign, date and return this Proxy promptly.
You may use the enclosed envelope.
Dated:
_________________, 2003
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Signature
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Signature, if held jointly
00250.0065 #373978v4