Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [X]
Filed by a party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-
12
Managed Municipals Portfolio Inc.
(Name of Registrant as Specified in its Charter)
William Renahan
Name of Person Filing Proxy Statement
Payment of Filing Fee (Check appropriate box):
[X] No longer applicable
[ ] $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-6(i)(3).
[ ] 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 the
transaction applies:
(2) Aggregate number of securities to which transactions
applies:
(3) Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule 0-11:1
(4) Proposed maximum aggregate value of transaction:
[ ] Check box if any part of the fee is offset as
provided
by Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the form or schedule
and the date of its filing.
(1) Amount previously paid:
(2) Form, schedule or registration statement no.:
(3) Filing party:
(4) Date filed:
1. Set forth the amount on which the filing fee is calculated
and
state how it was determined.
MANAGED MUNICIPALS PORTFOLIO INC.
7 WORLD TRADE CENTER
NEW YORK, NEW YORK 10048
---------------------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
---------------------------------------
To Be Held on September 13, 200012, 2001
To the shareholders of Managed Municipals Portfolio Inc.:
Notice is hereby given that the Annual Meeting of Shareholders of MANAGED
MUNICIPALS PORTFOLIO INC. (the "Portfolio") will be held at the Portfolio's
offices at Seven World Trade Center, New York, New York, 42nd40th Floor, Conference
Room A, on September 13, 200012, 2001 at 9:00 A.M. (New York Time) for the following
purposes:
1. To1.To elect twothree Class III directors of the Portfolio (Proposal 1);
2. To ratify the selection of KPMG LLP as independent auditors of
the
Portfolio for the fiscal year ended May 31, 2001 (Proposal 2);
and
3. To2.To transact such other business as may properly come before the meeting or
any adjournments thereof.
The Board of Directors has fixed the close of business on July 28, 200025, 2001 as
the record date for the determination of shareholders entitled to notice of,
and to vote at, the meeting and any adjournments thereof.
By Order of the Board of Directors
Christina T. Sydor
Secretary
New York, New York
August 14, 2000
----------------------13, 2001
-----------------
Your vote is important regardless of the size of your holdings in the
Portfolio. Whether or not you plan to attend the meeting, we ask that you
please complete and sign the enclosed proxy card and return it promptly in the
enclosed envelope which needs no postage if mailed in the continental United
States. Instructions for the proper execution of proxies are set forth on the
inside cover.
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of assistance to
you and avoid the time and expense to the Portfolio involved in validating your
vote if you fail to sign your proxy card properly.
1. Individual1.Individual Accounts: Sign your name exactly as it appears in the
regis-
trationregistration on the proxy card.
2. Joint2.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. All3.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
- ------------ ------
- ------------------------
Corporate Accounts
(1)ABC Corp. ...........................................Corp......................... ABC Corp.
(2)ABC Corp. ...........................................Corp......................... John Doe, Treasurer
(3)ABC Corp.
c/o John Doe, Treasurer...........................Treasurer......... John Doe
(4)ABC Corp. Profit Sharing Plan........................Plan.... John Doe, Trustee
Trust Accounts
(1)ABC Trust............................................Trust........................ Jane B. Doe, Trustee
(2)Jane B. Doe, Trustee
u/t/d 12/28/78....................................78.................. Jane B. Doe
Custodian or Estate Accounts
(1)John B. Smith, Cust.
f/b/o John B. Smith, Jr. UGMA.....................UGMA... John B. Smith
(2)John B. Smith........................................Smith.................... John B. Smith, Executor
MANAGED MUNICIPALS PORTFOLIO INC.
388 GREENWICH STREET7 WORLD TRADE CENTER
NEW YORK, NEW YORK 1001310048
(800) 451-2010
-----------------------------------------------------------
PROXY STATEMENT
-----------------------------------------------------------
FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON SEPTEMBER 13, 200012, 2001
INTRODUCTION
This proxy statement is furnished in connection with the solicitation by the
Board of Directors (the "Board") of Managed Municipals Portfolio Inc. (the
"Portfolio") of proxies to be voted at the Annual Meeting of Shareholders (the
"Meeting") of the Portfolio, to be held at the Portfolio's principal executive
offices at Seven World Trade Center, 42nd40th Floor, Conference Room A, New York,
New York 10048, on September 13, 200012, 2001 at 9:00 A.M. (New York Time), and at any
adjournments thereof, for the purposes set forth in the accompanying Notice of
Annual Meeting of Shareholders (the "Notice").
The cost of soliciting proxies and the expenses incurred in preparing this
proxy statement will be borne by the Portfolio. Proxy solicitations will be
made mainly by mail. In addition, certain officers, directorsDirectors and employees of
the Portfolio; Salomon Smith Barney Inc. ("Salomon Smith Barney"); Smith Barney
Fund Management LLC ("SBFM" or the "Manager") (formerly known as SSB Citi Fund
Management LLC ("SSB Citi" or the "Manager") (successor to
SSBC Fund
Management Inc.)LLC), the Portfolio's investment manager, which is an affiliate of
Salomon Smith Barney; and/or PFPC Global Fund Services ("PFPC"), the
Portfolio's sub-transfer agent, may solicit proxies in person or by telephone
or mail. Salomon Smith Barney and SSB CitiSBFM are each located at 7 World Trade
Center, New York, New York 10048; PFPC is located at 101 Federal Street,
Boston, Massachusetts 02110. In addition, the Portfolio will reimburse
brokerage firms or other record holders for their expenses in forwarding
solicitation materials to beneficial owners of shares of the Portfolio.
The Annual Report of the Portfolio, including audited financial statements
for the fiscal year ended May 31, 2000,2001, has previously been furnished to all
shareholders of the Portfolio. This proxy statement and form of proxy are first
being mailed to shareholders on or about August 14, 2000.13, 2001. The Portfolio will
provide additional copies of the Annual Report to any shareholder upon request
by calling the Portfolio at 1-800-451-2010.
All properly executed proxies received prior to the Meeting will be voted at
the Meeting in accordance with the instructions marked thereon or otherwise as
provided therein. Unless instructions to the contrary are marked, shares
represented
by the proxies will be voted "FOR" all the proposals listed in the Notice. For
purposes of determining the presence of a quorum for transacting business at
the Meeting, abstentions and broker "non-votes" (i.e. proxies from brokers or
nominees indicating that such persons have not received instructions from the
beneficial owner or other persons entitled to vote shares on a particular
matter with respect to which the brokers or nominees do not have discretionary
power) will be treated as shares that are present but which have not been
voted. Because both proposals requirethe proposal requires a proportion of the votes cast for their
approval, abstentions and broker "non-votes" may influence whether a quorum is
present but will have no impact on the requisite approval of a proposal. A
quorum consists of the presence (in person or by proxy) of the holders of a
majority of the outstanding shares of the Portfolio entitled to notice of, and
to vote at, the Meeting. Proposal 1 requires for approval the affirmative vote
of a plurality of the votes cast at the Meeting with a quorum present. Proposal 2 requires for approval the
affirmative vote
of a majority of the votes cast at the Meeting with a quorum
present. Any
proxy may be revoked at any time prior to the exercise thereof by submitting another
proxy bearing a later date or by giving written notice to the Secretary of the
Portfolio at the Portfolio's address indicated above or by voting in person at
the Meeting.
The Board knows of no business other than that specifically mentioned in the
Notice that will be presented for consideration at the Meeting. If any other
matters are properly presented, it is the intention of the persons named in the
enclosed proxy to vote in accordance with their best judgment to the extent
permissible under applicable law.
The Board of Directors of the Portfolio has fixed the close of business on
July 28, 200025, 2001 as the record date (the "Record Date") for the determination of
shareholders of the Portfolio entitled to notice of and to vote at the Meeting
or any adjournment thereof. Shareholders of the Portfolio as of the Record Date
will be entitled to one vote on each matter for each share held and a
fractional vote with respect to fractional shares, with no cumulative voting
rights. As of the Record Date, the Portfolio had outstanding 32,007,443.54631,848,643.546
shares of Common Stock, par value $.001 per share, the only authorized class of
stock, of which 31,196,15331,130,893.000 shares (97.47%(98%) were held but not beneficially
owned by CEDE & CO., P.O. Box 20, Bowling Green Station, New York, NY 10004. As
of the Record Date, no other person (including any "group" as that term is used
in Section 13(d) of the Securities Exchange Act of 1934), to the knowledge of
the Board, owned beneficially more than 5% of the outstanding shares of the
Portfolio. As of the Record Date, the officers and Board members of the
Portfolio as a group beneficially owned less than 1% of the outstanding shares
of the Portfolio.
In the event that a quorum is not present, or if sufficient votes in favor
of the proposals set forth in the Notice and this Proxy Statement are not
received by the time scheduled for the Meeting, the persons named as proxies
may propose one or 2
more adjournments of the Meeting to permit further
solicitation of proxies with respect to any such proposals. In determining
whether to adjourn the Meeting, the
2
following factors may be considered: the nature of the proposals that are the
subject of the Meeting, the percentage of votes actually cast, the percentage
of negative votes actually cast, the nature of any further solicitation and the
information to be provided to shareholders with respect to the reasons for the
solicitation. Any such adjournment will require the affirmative vote of a
majority of the shares represented at the Meeting. The persons named as proxies
will vote in favor of such adjournment those shares which they are entitled to
vote and which have voted in favor of such proposals.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The Board of Directors of the Portfolio is classified into three classes.
The directorsDirectors serving in Class III have terms expiring at the Meeting; the Class
I directorsII Directors currently serving on the Board have been nominated by the Board of
Directors for re-electionelection at the Meeting to serve for a term of three years (until
the year 20032004 Annual Meeting of Shareholders) or until their successors have
been duly elected and qualified.
The Board of Directors of the Portfolio knows of no reason why any of the
Class III nominees listed below will be unable to serve, and each nominee has
consented to serve if elected, but in the event of any such unavailability, the
proxies received will be voted for such substitute nominees as the Board of
Directors may recommend.
Certain information concerning the nominees is set forth below. For any
nominee or director indicated as owning shares of the Portfolio, such ownership
constituted less than 1% of the outstanding shares ofon the Record Date. All of
the nominees are currently directors of the Portfolio. Except as indicated,
each individual has held the office shown or other offices in the same company
for the last five years.
Persons Nominated for Election as Directors
Principal Occupations Number of Shares
During Past Five Years, Owned as of
Name Other Directorships, and Age July 31, 20002001
---- ---------------------------- ----
- ----------------------------
CLASS III DIRECTORS
Allan J. BloosteinRobert A. Frankel Managing Partner of Robert A. Frankel Management 281.401
Director since 1994 Consultants; formerly Corporate Vice President of
Allan J. Bloostein
660.000The Reader's Digest Association Inc.; 74.
Dr. Paul Hardin Chancellor Emeritus and Professor of Law at the 200.000
Director since 1992 Associates, a consulting firm; retired
Vice2001 University of North Carolina at Chapel Hill;
formerly Chancellor of the University of North
Carolina at Chapel Hill; 70.
3
Principal Occupations Number of Shares
During Past Five Years, Owned as of
Name Other Directorships, and Age July 31, 2001
---- ---------------------------- ----------------
Heath B. McLendon* Managing Director of Salomon Smith Barney; 1979.122(a)
Director since 1995 Chairman or Co-Chairman of 77 investment
companies associated with Citigroup, Inc.
(''Citigroup''); President and Director of May
Department Stores; Director of CVS
CorporationSBFM and
Taubman CentersTravelers Investment Advisor, Inc. (''TIA'');
70.
Martin Brody Consultant, HMK Associates; retired
169.552
Director since 1992 Viceformerly Chairman of the Board of Directors of Restaurant Associates
Corp.; Director of Jaclyn,Smith Barney
Strategy Advisers Inc.; 79.68.
3
- --------
(a) Includes shares owned by members of this Director's family.
The remainder of the Board constitutes the Class III and Class III directors,Directors,
none of whom will stand for election at the Meeting, as their terms will expire
in the years 20012003 and 2002, respectively. DirectorsAny Director affiliated with the
Manager and considered an "interested person" of the Portfolio, as defined in
the Investment Company Act of 1940, as amended (the "1940 Act") areis indicated by
an asterisk (*).
Directors Continuing in Office
Principal Occupations Number of Shares
During Past Five Years, Owned as of
Name Other Directorships, and Age July 31, 20002001
---- ---------------------------- ----
- ----------------------------
CLASS III DIRECTORS
Robert A. Frankel Managing Partner of Robert A. Frankel
281.401Allan J. Bloostein President, Allan J. Bloostein Associates, a 700.120
Director since 1994 Management Consultants; formerly
Corporate1992 consulting firm; retired Vice Chairman and
Director of May Department Stores; Director of
Taubman Centers Inc.; Retired Director of CVS
Corporation; 71.
Martin Brody Consultant, HMK Associates; retired Vice 179.690
Director since 1992 Chairman of the Board of Directors of Restaurant
Associates Corp.; 80.
Paulo M. Cucchi Vice President and Dean of the
Reader's Digest Association Inc.; 73.
Heath B. McLendon* Managing DirectorCollege of Salomon Smith
1,479.029(a)Liberal Arts 0.000
Director since 1995 Barney; Director of 78 investment
companies associated with Citigroup;
President of SSB Citi; former
Chairman of Salomon Smith Barney
Strategy Advisers Inc. and President
of Travelers Investment Advisers,
Inc. ("TIA"); 67.2001 at Drew University; 59.
CLASS III DIRECTORS
Dwight B. Crane Professor, Harvard Business School; 633.153Director, 658.616
Director since 1992 Director Peer Review Analysis,Micro Forum, Inc.; 62.63.
William R. Hutchinson President, WR Hutchinson & Associates, Inc.; 115.995
Director since 1995 formerly Group Vice President, Mergers &
108.883
Director since 1995 Acquisitions BP Amoco p.l.c. since
January 1, 1999;; formerly
Vice President-FinancialPresident--Financial Operations AMOCO
Corporation; Director of Associated Bank andBank; Director
of Associated Banc-
Corp.Banc-Corp.; 57.
- ------------------58.
George M. Pavia Senior Partner, Pavia & Harcourt, Attorneys; 72. 0.000
Director since 2001
- --------
(a)Includes shares owned by members of this director's family.
4
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 and Section 30(h) of
the 1940 Act require the Portfolio's officers and directors, and persons who
beneficially own more than ten percent of a registered class of the Portfolio's
equity securities, and certain entities to file reports of ownership with the
Securities and Exchange Commission, the New York Stock Exchange, Inc. and the
Portfolio. Based solely upon its review of the copies of such forms received by
it, the Portfolio believes that, during fiscal year 2000,2001, all filing
requirements applicable to such persons were complied with.
4
The Portfolio has no compensation or nominating committee of the Board of Directors, or
any committee performing similar functions. The Portfolio has an
audita nominating
committee composed of all the directorsDirectors who are not "interested persons" of the
Portfolio as defined underwithin the meaning of the 1940 Act (the "independent
directors""Independent Directors"),
which is charged with recommending nominees for election as Directors of the
Portfolio. The nominating committee will accept nominations for the office of
Director made by the stockholders in a written request addressed to the
Secretary of the Portfolio which includes biographical data and sets forth the
qualifications of the proposed nominee. The Portfolio has an audit committee
composed of the Independent Directors, which is charged with recommending a
firm of independent auditors to the Portfolio and reviewing accounting matters
with the auditors.
Fiveauditors as set forth in the committee's charter, which is attached
hereto as Appendix A. The audit committee held one meeting during the
Portfolio's most recent fiscal year. The Portfolio has a pricing committee
composed of the Independent Directors which is charged with determining fair
value prices for securities when required. The pricing committee held one
meeting during the Portfolio's last fiscal year.
Four meetings of the Board of Directors of the Portfolio were held during
the last fiscal year, fourall of which were regular meetings. In the last fiscal
year, no directorDwight B. Crane attended less than 75% of these meetings of the Board
that were held.
Only the independent directorsIndependent Directors receive remuneration from the Portfolio for
acting as a director. Aggregate fees and expenses (including reimbursement for
travel and out-of-pocket expenses) of $2,953.24$2,199.61 were paid to
such directorsDirectors by the
Portfolio during the fiscal year ended on May 31, 2000.2001. Fees for the
independent directorsIndependent Directors are set at $5,000 per annum and, in addition, these
directorsDirectors receive $500 for each Board meeting attended in person, $100 for each
telephonic board meeting, plus travel and out-of-pocket expenses incurred in
connection with Board meetings. The out-of-pocket expenses are borne equally by
each individual fund in the group of funds served by the same Board members.
None of the officers of the Portfolio received any compensation from the
Portfolio for such period. Officers and interested directorsDirectors of the Portfolio
are compensated by the Manager or by Salomon Smith Barney.
5
The following table shows the compensation paid by the Portfolio to each
person who was a directorDirector during the Portfolio's lastmost recent fiscal year.
COMPENSATION TABLE
Number of
Aggregate Pension or Retirement Funds for Which
Compensation Benefits Accrued as part Total Compensation Person Served
Name of Person from Fund of Fund Expenses from Fund Complex Within Fund Complex
-------------- ------------ ------------------------ ------
- ------------------------------ -------------------
Martin Brody $6,500$6,016.00 $0 $138,600$132,950.00 20
Dwight B. Crane 6,5005,533.00 0 155,363 23151,375.00 22
Allan J. Bloostein 7,1006,033.00 0 112,483 19109,500.00 18
Robert A. Frankel 7,0006,533.00 0 79,45069,350.00 9
William R. Hutchinson 7,1006,050.00 0 49,35038,300.00 7
Heath B. McLendon* 0 0 0 7877
* Designates a directorDirector who is an "interested person" of the Portfolio.
Upon attainmentAt the end of the calendar year in which they attain age 80, Portfolio
Directors are required to change to emeritus status. Directors Emeritus are
entitled to serve in emeritus status for a maximum of 10 years during which
time they are paid 50% of the annual retainer fee and meeting fees otherwise
applicable to Portfolio Directors, together with reasonable out-of-pocket
expenses for each meeting attended. During the Portfolio's lastmost recent fiscal
year, aggregate compensation paid by the Portfolio to Directors Emeritus
totaled $3,250
5$2,750.00.
6
The following is a list of the current executive officers of the Portfolio,
all of whom have been elected by the Board to serve until their respective
successors are elected:
Principal Occupations
Offices and Positions Period Principal Occupations During
Past Five Years
Name Held with Fund Offices Held Past Five Years and Age
- ---- --------------------- --------------- --------
- ---------------------------------------------------
Heath B. McLendon Chief Executive 1992 to present (see table of directorsDirectors above)
Officer, above)
Chairman of
the Board and
President
Lewis E. Daidone Senior Vice 1994 to present Managing Director of Salomon Smith
President and Salomon
Smith Barney;
Treasurer Senior Vice President and
Treasurer Treasurer or Executive Vice President
and Treasurer of 61certain other
investment companies associated with
Salomon Smith
Barney;Citigroup; Director and Senior Vice
President of SSB
CitiSBFM and TIA; 43.44.
Joseph P. Deane Vice President 1993 to present Managing Director of Salomon Smith
and Investment SSB
Citi; prior to JulyBarney; Investment Officer 1993,
Managing Director
of Shearson Lehman
Advisors; 52.SBFM;
Officer 53.
Christina T. Sydor Secretary 1994 to present Managing Director of Salomon Smith
Barney; Secretary or Executive
Vice
President and
General
Counsel of 61certain other
investment companies associated with
Salomon
Smith
Barney;Citigroup; Secretary and General
Counsel of SSB CitiSBFM and TIA; 49.50.
Paul Brook Controller 1998 to present Director of Salomon Smith Barney;
Controller or Assistant Secretary of
43various investment companies
associated with Salomon
Smith
Barney; 46.Citigroup; prior to
1998, Managing Director of AMT
Capital Services Inc.; prior to 1997,
partner with Ernst & Young LLP; 47.
The Board of Directors, including all of the independent
directors,Independent Directors,
recommends that you vote "FOR" the election of nominees to the Board.
PROPOSAL NO. 2
RATIFICATION7
REPORT OF SELECTION OF INDEPENDENT AUDITORSTHE AUDIT COMMITTEE
The audit committee reports that it has (i) reviewed and discussed the
Portfolio's audited financial statements with management; (ii) discussed with
the independent auditors the matters (such as the quality of the Portfolio's
accounting principals and internal controls) required to be discussed by
Statement on Auditing Standards No. 61; and (iii) received oral confirmation
from KPMG LLP ("KPMG") that it is independent and written disclosures regarding
such independence as required by Independence Standards Board Standard No. 1,
and discussed with the auditors the auditor's independence. Based on the review
and discussions referred to in items (i) through (iii) above, the audit
committee recommended to the Board of Directors (and the board has been selected asapproved)
that the independent auditors
to auditaudited financial statements be included in the accountsPortfolio's annual
report for the Portfolio's fiscal year ended May 31, 2001. The membership of
the audit committee is comprised of the following Directors: Martin Brody,
Dwight B. Crane, Allan J. Bloostein, Robert A. Frankel, William R. Hutchinson,
Paolo M. Cucchi, Paul Hardin, and George M. Pavia.
Audit Fees. Fees for the annual audit of the Portfolio's financial
statements by KPMG for the fiscal year ended May 31, 2001 were $32,500.
Financial Information Systems Design and Implementation Fees. Neither the
Portfolio fornor SBFM or other entities under common control engaged KPMG to
provide advice to the Portfolio regarding financial information system design
and implementation during the fiscal year endingended May 31, 2001.
All Other Fees. The aggregate fees billed for all other non-audit services,
including fees for tax related services, rendered by KPMG to the Portfolio,
SBFM and entities controlled by or affiliated with SBFM that provide services
to the Portfolio for the fiscal year ended May 31, 2001 by a majoritywere $2,000. The audit
committee of the independent directors, whichPortfolio has determined that provision of these non-audit
services is subject to
ratification
bycompatible with maintaining the shareholders at the Meeting. The entire Board concurred in
the
selectionindependence of KPMG. KPMG also serves as the independent auditors for
the
Manager, other investment companies associated with Salomon Smith
Barney and
for Citigroup, Inc. ("Citigroup"), the ultimate parent company of
Salomon
Smith Barney and the Manager. KPMG has no direct or material
indirect
financial interest in the Portfolio, the Manager, Citigroup or any
other
investment company sponsored by Salomon Smith Barney or its
affiliates.
6
If the Portfolio receives a written request from any shareholder
at least
five days prior to the Meeting stating that the shareholder will be
present in
person at the Meeting and desires to ask questions of the auditors
concerning
the Portfolio's financial statements, the Portfolio will arrange to
have a
representative of KPMG present at the Meeting who will respond to
appropriate
questions and have an opportunity to make a statement.
The affirmative vote of a majority of votes cast at the Meeting
is required
to ratify the selection of KPMG. The Board of Directors, including
all of the
independent directors, recommends that the shareholders vote "FOR"
the
ratification of the selection of independent auditors.
OTHER MATTERS
The Manager knows of no other matters which are to be brought before the
Meeting. However, if any other matters not now known or determined properly come before the
Meeting, it is the intention of the persons named in the enclosed form of proxy
to vote such proxy in accordance with their judgment on such matters.
All proxies received will be voted in favor of all the proposals, unless
otherwise directed therein.
8
SUBMISSION OF SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 20012002 Annual Meeting of
the shareholders of the Portfolio must be received by April 17, 20012002 to be
included in the proxy statement and the form of proxy relating to that meeting,
as the Portfolio expects that the 20012002 Annual Meeting will be held in September
of 2001.2002. The submission by a shareholder of a proposal for inclusion in the proxy
statement does not guarantee that it will be included. Shareholder proposals
are subject to certain regulations under the federal securities laws.
The persons named as proxies for the Annual Meeting of Shareholders for 20012002
will have discretionary authority to vote on any matter presented by a
shareholder for action at that meeting unless the Portfolio receives notice of
the matter by June 30, 2001,28, 2002, in which case these persons will not have
discretionary voting authority except as provided in the Securities and
Exchange Commission's rules governing shareholder proposals.
7
It is important that proxies be returned promptly. Shareholders who do not
expect to attend the meeting are therefore urged to complete and sign, date and
return the proxy card as soon as possible in the enclosed postage-paid
envelope.
By Order of the Board of Directors,
Christina T. Sydor
Secretary
August 14, 2000
813, 2001
9
Appendix A
MANAGED MUNICIPALS PORTFOLIO INC.
AUDIT COMMITTEE CHARTER
I. Composition of the Audit Committee: The Audit Committee shall be
comprised of at least three directors, each of whom shall have no relationship
to the Managed Municipals Portfolio Inc. (the "Company") that may interfere
with the exercise of their independence from management and the Company and
shall otherwise satisfy the applicable membership requirements under the rules
of the New York Stock Exchange, Inc, as such requirements are interpreted by
the Board of Directors in its business judgment.
II. Purposes of the Audit Committee: The purposes of the Audit Committee are
to assist the Board of Directors:
1. in its oversight of the Company's accounting and financial reporting
principles and policies and audit controls and procedures;
2. in its oversight of the Company's financial statements and the
independent audit thereof;
3. in selecting (or nominating the outside auditors to be proposed for
shareholder approval in any proxy statement), evaluating and, where
deemed appropriate, replacing the outside auditors; and
4. in evaluating the independence of the outside auditors.
The function of the Audit Committee is oversight. The management of the
Company is responsible for the preparation, presentation and integrity of the
Company's financial statements. Management and the internal auditing department
are responsible for maintaining appropriate accounting and financial reporting
principles and policies and internal controls and procedures designed to assure
compliance with accounting standards and applicable laws and regulations. The
outside auditors are responsible for planning and carrying out a proper audit
in accordance with Generally Accepted Auditing Standards. In fulfilling their
responsibilities hereunder, it is recognized that members of the Audit
Committee are not full-time employees of the Company and are not, and do not
represent themselves to be, accountants or auditors by profession or experts in
the fields of accounting or auditing. As such, it is not the duty or
responsibility of the Audit Committee or its members to conduct "field work" or
other types of auditing or accounting reviews or procedures, and each member of
the Audit Committee shall be entitled to rely on (i) the integrity of those
persons and organizations within and outside the Company that it receives
information from and (ii) the accuracy of the financial and other information
provided to the Audit Committee by such persons and organizations absent actual
knowledge to the contrary (which shall be promptly reported to the Board of
Directors).
A-1
The outside auditors for the Company are ultimately accountable to the Board
of Directors (as assisted by the Audit Committee). The Board of Directors, with
the assistance of the Audit Committee, has ultimate authority and
responsibility to select, evaluate and, where appropriate, replace the outside
auditors (or to nominate the outside auditors to be proposed for shareholder
approval in the proxy statement).
The outside auditors shall submit to the Audit Committee annually a formal
written statement delineating all relationships between the outside auditors
and the Company ("Statement as to Independence") which, in the auditor's
professional judgment may be reasonably thought to bear on independence,
addressing at least the matters set forth in Independence Standards Board No.
1.
III. Meetings of the Audit Committee: The Audit Committee shall meet at
least annually with the outside auditors to discuss the annual audited
financial statements and results of their audit. The Audit Committee may
request any officer or employee of the Company or the Company's outside counsel
or outside auditors to attend a meeting of the Audit Committee or to meet with
any members of, or consultants to, the Audit Committee.
IV. Duties and Powers of the Audit Committee: To carry out its purposes, the
Audit Committee shall have the following duties and powers:
1. to provide advice to the Board of Directors in selecting, evaluating or
replacing outside auditors;
2. to review the fees charged by the outside auditors for audit and
non-audit services;
3. to ensure that the outside auditors prepare and deliver annually a
Statement as to Independence (it being understood that the outside
auditors are responsible for the accuracy and completeness of this
Statement), to discuss with the outside auditors any relationships or
services disclosed in this Statement that may impact the objectivity and
independence of the Company's outside auditors and to recommend that the
Board of Directors take appropriate action in response to this Statement
to satisfy itself of the outside auditors' independence;
4. to instruct the auditors that the outside auditors are ultimately
accountable to the Board of Directors and Audit Committee;
5. to advise management and the outside auditors that they are expected to
provide to the Audit Committee a timely analysis of significant
financial reporting issues and practices;
6. to consider any reports or communications (and management's responses
thereto) submitted to the Audit Committee by the outside auditors
required by or referred to in SAS 61 (as codified by AU Section 380), as
may be modified or supplemented, including reports and communications
related to:
A-2
. deficiencies noted in the audit in the design or operation of
internal controls;
. consideration of fraud in a financial statement audit;
. detection of illegal acts;
. the outside auditors' responsibility under generally accepted
auditing standards;
. significant accounting policies;
. management judgments and accounting estimates;
. adjustments arising from the audit;
. the responsibility of the outside auditors for other information in
documents containing audited financial statements;
. disagreements with management;
. consultation by management with other accountants;
. major issues discussed with management prior to retention of the
outside auditors;
. difficulties encountered with management in performing the audit;
. the outside auditors' judgments about the quality of the entity's
accounting principles; and
. reviews of interim financial information conducted by the outside
auditors.
7. with respect to reporting and recommendations, to discuss with the
Company's General Counsel any significant legal matters that may have a
material effect on the financial statements, the Company's compliance
policies, including material notices to or inquiries received from
governmental agencies;
8. to prepare any report, including any recommendation of the Audit
Committee, required by the rules of the Securities and Exchange
Commission to be included in the Company's annual proxy statement;
9. to review this Charter at least annually and recommend any changes to
the full Board of Directors; and
10.to report its activities to the full Board of Directors on a regular
basis and to make such recommendations with respect to the above and
other matters as the Audit Committee may deem necessary or appropriate.
V. Resources and Authority of the Audit Committee: The Audit Committee shall
have the resources and authority appropriate to discharge its responsibilities,
including the authority to engage outside auditors for special audits, reviews
and other procedures and to retain special counsel and other experts or
consultants.
A-3
FORM OF PROXY
MANAGED MUNICIPALS PORTFOLIO INC.
Proxy Solicited By the Board of Directors
The undersigned holder of shares of Common Stock of the Managed
Municipals Portfolio Inc. (the "Portfolio") a Maryland corporation,
hereby appoints Heath B. McLendon, Christina Sydor and William J.
Renahan as
attorneys and proxies for the undersigned with full power of
substitution and revocation, to represent the undersigned and to vote
on behalf of the undersigned all shares of Common Stock of the
Portfolio which the undersigned is entitled to vote at the Annual
Meeting of Shareholders of the Portfolio to be held at the offices of
the Portfolio, Seven World Trade Center, 42nd Floor, New York, New
York, on
September 13, 200012, 2001 at 9:00 a.m., and any adjournment or adjournments
thereof. The undersigned hereby acknowledges receipt of the Notice of
Meeting and Proxy Statement dated August 14, 200013, 2001 and hereby
instructs said attorneys and proxies to vote said shares as indicated
hereon. In their discretion, the proxies are authorized to vote upon
such other business as may properly come before the meeting. A
majority of the proxies present and acting at the Meeting in person or
by substitute (or, if only one shall be so present, then that one)
shall have and may exercise all of the power and authority of said
proxies hereunder. The undersigned hereby revokes any proxy
previously
given.
SEE REVERSE SIDE
CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE
SEE REVERSE SIDE
X Please mark votes as in this example
This proxy, if properly executed, will be voted in the manner
directed by the undersigned shareholder. If no direction is made,
this proxy will be voted for election of each nominee as director
and
proposal 2.
The Board of Directors recommends a vote "FOR" the following
proposals:director.
1. ELECTION OF CLASS II DIRECTORS FOR ALL NOMINEES
Nominees: (01) Robert A. Frankel, WITHHELD Nominees: Allan J. Bloostein and
Martin BrodyFROM ALL
(2)Dr. Paul Hardin, (3)Heath B. McLendon. NOMINEES
_______________________________
For all nominees except as noted above
2. PROPOSAL TO RATIFY THE FOR AGAINST ABSTAIN
SELECTION OF KPMG
LLP AS THE INDE-
PENDENT AUDITORS OF THE
PORTFOLIO FOR THE FISCAL YEAR
ENDED May 31, 2001.
MARK HERE FOR ADDRESS CHANGE AN NOTE AT LEFT
PLEASE SIGN, DATE AND RETURN PROMPTLY
IN THE ENCLOSED ENVELOPE
Note: Please sign exactly as your name appears on this proxy.
If joint owners, EITHER may sign this Proxy. When signing as
attorney, executor, administrator, trustee, guardian or corporate
officer, please give your full title.
Signature: ____________________________ Date: ________________
Signature: ____________________________ Date: ________________