COLONIAL MUNICIPAL INCOME TRUST
One Financial Center, Boston, Massachusetts 02111
(617) 426-3750
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 28, 1995
Dear Fellow Shareholder:
The Annual Meeting of Shareholders (Meeting) of Colonial
Municipal Income Trust (Fund) will be held at the offices of
Colonial Management Associates, Inc. (Adviser), One Financial
Center, Boston, Massachusetts, on Friday, April 28, 1995, at
10:00 A.M., Eastern time, to:
1. Elect seven Trustees;
2. Ratify or reject the selection of independent
accountants; and
3. Transact such other business as may properly
come before the Meeting or any adjournment
thereof.
By order of the
Trustees,
Arthur O. Stern,
Secretary
March 24, 1995
NOTICE: YOUR VOTE IS IMPORTANT, REGARDLESS OF THE NUMBER OF
SHARES YOU OWN. IF A QUORUM IS NOT PRESENT AT THE MEETING,
ADDITIONAL EXPENSES WILL BE INCURRED TO SOLICIT ADDITIONAL
PROXIES. TO AVOID THESE COSTS TO YOUR FUND, PLEASE VOTE, SIGN
AND RETURN YOUR PROXY IN THE ENCLOSED POSTAGE-PAID ENVELOPE
IMMEDIATELY.
IT-85/760A-0395
PROXY STATEMENT
General Information
March 24, 1995
The enclosed proxy, which was first mailed on March 24,
1995, is solicited by the Trustees for use at the Meeting. All
properly executed proxies received in time for the Meeting will
be voted as specified in the proxy or, if no specification is
made, in favor of each proposal referred to in the Proxy
Statement. The proxy may be revoked prior to its exercise by a
later dated proxy, by written revocation received by the
Secretary or by voting in person. Solicitation may be made by
mail, telephone, telegraph, telecopy and personal interviews.
Authorization to execute proxies may be obtained by
telephonically or electronically transmitted instructions. The
cost of solicitation will be paid by the Fund.
Thirty percent of the shares outstanding and entitled to
vote constitutes a quorum and must be present in person or
represented by proxy for business to be transacted at the
Meeting. On February 1, 1995, the Fund had outstanding
27,346,098 shares of beneficial interest. Shareholders of record
at the close of business on February 1, 1995 will have one vote
for each share held. As of February 1, 1995, Cede & Co., P.O.
Box 20, Bowling Green Station, New York, New York 10004 owned of
record 66.42% of the Fund's outstanding shares.
Votes cast by proxy or in person will be counted by persons
appointed by the Fund to act as election tellers for the Meeting.
The tellers will count the total number of votes cast "for"
approval of the proposals for purposes of determining whether
sufficient affirmative votes have been cast. Where a shareholder
withholds authority or abstains, or the proxy reflects a "broker
non-vote" (i.e., shares held by brokers or nominees as to which
(i) instructions have not been received from the beneficial
owners or persons entitled to vote and (ii) the broker or nominee
does not have the discretionary voting power on a particular
matter) the shares will be counted as present and entitled to
vote on the matter for purposes of determining the presence of a
quorum. With respect to the election of Trustees and
ratification of independent accountants, withheld authority,
abstentions and broker non-votes have no effect on the outcome of
the voting.
Further information concerning the Fund is contained in its
most recent Annual Report to shareholders, which is obtainable
free of charge by writing the Adviser at One Financial Center,
Boston, MA 02110 or by calling 1-800-248-2828.
1. Election of Seven Trustees.
Messrs. Birnbaum, Grinnell, Ireland, Lowry, Mayer, Shinn and
Sullivan (who have each agreed to serve) are proposed for
election as Trustees of the Fund each to serve three years or
until a successor is elected. Messrs. Ireland, Mayer, Shinn and
Sullivan currently serve as Trustees. Messrs. Birnbaum, Grinnell
and Lowry are proposed to be added to the Board. The election of
each of Messrs. Birnbaum, Grinnell and Lowry is conditioned on
(1) the closing of the Merger described below (Merger) of The
Colonial Group, Inc. (TCG), parent company of the Adviser, with a
subsidiary of Liberty Financial Companies, Inc. (Liberty
Financial) (currently scheduled to occur on or about March 24,
1995) and (ii) their nomination by the current Trustees at a
meeting scheduled for April 21, 1995. The Board of Trustees
currently consists of Ms. Collins and Messrs. Bleasdale, Ireland,
Mayer, McNeice, Moody, Neuhauser, Shinn, Sullivan and Weeks. The
Board is currently divided into the following three classes, each
with a three year term expiring in the year indicated (assuming
the persons listed above, other than Messrs. Birnbaum, Grinnell
and Lowry, are elected at the Meeting):
1996 1997 1998
Mr. Bleasdale Ms. Collins Mr. Ireland
Mr. McNeice Mr. Neuhauser Mr. Mayer
Mr. Moody Mr. Weeks Mr. Shinn
Mr. Sullivan
The years in which Messrs. Birnbaum's, Grinnell's and
Lowry's terms will expire will be determined by the current
Trustees at their April meeting.
The following table sets forth certain information about the
current Trustees and about Messrs. Birnbaum, Grinnell and Lowry:
Shares
Beneficially
Owned
and
Percent of
Nominee Name Principal Occupation (1) Fund at
Age Trustee since and Directorships February 1, 1995(2)
Robert J. Birnbaum Retired January, 1994; ----
(67) Special Counsel, Dechert
Price & Rhoads (September,
1988 to December, 1993);
President and Chief
Operating Officer, New York
Stock Exchange (May, 1985 to
June, 1988); Trustee,
Liberty Financial Trust.
Tom Bleasdale Retired (formerly Chairman ----
(64) 1992 of the Board and Chief
Executive Officer, Shore
Bank & Trust Company).
Director or Trustee:
Colonial Funds (3), Stok,
Inc.
Lora S. Collins Attorney, Kramer, Levin, ----
(59) 1992 Naftalis, Nessen, Kamin &
Frankel (law). Trustee:
Colonial Funds (3).
James E. Grinnell Private Investor (since ----
(65) November, 1988); Senior Vice
President-Operations, The
Rockport Company, importer
and distributor of shoes
(May, 1986 to November,
1988); Trustee, Liberty
Financial Trust.
William D. Ireland, Retired (formerly Chairman ----
Jr. of the Board, Bank of New
(71) 1987 England--Worcester).
Director or Trustee:
Colonial Funds (3).
Richard W. Lowry Private Investor (August, ----
(58) 1987 to present); Chairman
and Chief Executive Officer,
U.S. Plywood Corporation,
manufacturer and distributor
of wood products (August,
1985 to August, 1987);
Trustee, Liberty Financial
Trust.
William E. Mayer* Dean of the College of ----
(54) 1994 Business and Management,
University of Maryland
(formerly Dean of the Simon
Graduate School of Business,
University of Rochester;
Chairman and Chief Executive
Officer, C.S. First Boston
Merchant Bank; and President
and Chief Executive Officer,
The First Boston
Corporation). Director or
Trustee: Colonial Funds
(3), Hambrecht & Quist
Incorporated, American
Medical Inc., Chart House
Enterprises and Riverwood
International Corp.
John A. McNeice, Chairman of the Board, Chief ----
Jr.* Executive Officer and
(62) 1987 Director of the Adviser:
Chairman of the Board and
Director of TCG: Trustee:
Colonial Funds (3).
James L. Moody, Jr. Chairman of the Board, ----
(63) 1987 Hannaford Bros. Co. (food
distributor) (formerly Chief
Executive Officer, Hannaford
Bros. Co.). Director or
Trustee: Colonial Funds (3),
Penobscot Shoe Co., Sobeys
Inc., Hills Stores Company,
Inc., UNUM Corporation,
IDEXX Laboratories.
John J. Neuhauser Dean of the School of ----
(51) 1987 Management, Boston College.
Director or Trustee:
Colonial Funds (3), Hyde
Athletic Industries, Inc.
George L. Shinn Financial Consultant ----
(72) 1992 (formerly Chairman, Chief
Executive Officer and
Consultant, The First Boston
Corporation). Trustee or
Director: Colonial Funds
(3), The New York Times Co.,
Phelps Dodge Corp.,
Robert L. Sullivan Management Consultant. ----
(67) 1989 Trustee: Colonial Funds (3).
Sinclair Weeks, Jr. Chairman of the Board, Reed ----
(71) 1992 & Barton Corporation.
Director or Trustee:
Colonial Funds (3),
Commonwealth Energy Systems.
* Mr. McNeice is an "interested person," as defined by the
Investment Company Act of 1940 (1940 Act) because of his
affiliation with TCG and the Adviser. Mr. Mayer is an
"interested person" because of his affiliation with
Hambrecht & Quist Incorporated (a registered broker
dealer).
(1) Except as otherwise noted, each individual has held the
office indicated or other offices in the same company for
the last five years.
(2) On February 1, 1995, the Trustees and officers of the Fund
beneficially owned less than 1% of the then outstanding
shares of the Fund.
(3) Colonial Funds include: Colonial Trust I, Colonial Trust
II, Colonial Trust III, Colonial Trust IV, Colonial Trust
V, Colonial Trust VI, Colonial High Income Municipal
Trust, Colonial InterMarket Income Trust I, Colonial
Intermediate High Income Fund, Colonial Investment Grade
Municipal Trust and Colonial Municipal Income Trust.
The following table sets forth certain information about the
executive officers of the Fund.
Name
Age Executive Principal Occupation (4)
Officer Since
John A. McNeice, Jr. President and Trustee of the
62 1987 Fund: Chairman of the Board,
Chief Executive Officer and
Director of the Adviser:
Chairman of the Board and
Director of TCG: President
and Trustee of Colonial Funds
(5).
Harold W. Cogger Vice President of the Fund:
59 1993 President and Director of the
Adviser (formerly Executive
Vice President): President,
Chief Executive Officer and
Director of TCG: Vice
President of Colonial Funds
(5).
Davey S. Scoon Vice President of the Fund
48 1993 (formerly Treasurer):
Executive Vice President and
Director of the Adviser
(formerly Senior Vice
President and Treasurer):
Executive Vice President and
Chief Operating Officer of
TCG (formerly Vice President
- Finance and Administration
and Treasurer): Vice
President of Colonial Funds
(formerly Treasurer) (5).
Richard A. Silver Treasurer and Chief Financial
48 1993 Officer of the Fund (formerly
Controller): Senior Vice
President, Director,
Treasurer and Chief Financial
Officer of the Adviser:
Treasurer and Chief Financial
Officer of TCG (formerly
Assistant Treasurer):
Treasurer and Chief Financial
Officer of Colonial Funds
(5).
Peter L. Lydecker Controller of the Fund
41 1993 (formerly Assistant
Controller): Vice President
of Adviser (formerly
Assistant Vice President):
Controller of Colonial Funds
(formerly Assistant
Controller) (5).
(4) Except as otherwise noted, each individual has held the
office indicated or other offices in the same company for
the last five years.
(5) Colonial Funds include: Colonial Trust I, Colonial Trust
II, Colonial Trust III, Colonial Trust IV, Colonial Trust
V, Colonial Trust VI, Colonial High Income Municipal
Trust, Colonial InterMarket Income Trust I, Colonial
Intermediate High Income Fund, Colonial Investment Grade
Municipal Trust and Colonial Municipal Income Trust.
Certain officers and Trustees of the Fund also hold
positions with the other Colonial Funds for which the Adviser
acts as investment adviser.
Trustees Meetings and Committees
During the fiscal year ended November 30, 1994, the Board
held seven meetings.
The current Trustees received the following compensation
from the Fund for the fiscal year ended November 30, 1994 and
from the Colonial Funds for the calendar year ended December 31,
1994 for serving as Trustees:
Aggregate
Compen- Pension or
sation Retirement Estimated Total Compensation
From Benefits Annual From Fund
Fund for Accrued As Benefits Fund Complex
the fiscal Part of Upon For the Calendar
year ended Fund Retirement year ended
Trustee 11/30/94 Expense Retirement 12/31/94 (b)
Tom Bleasdale $1,944 (a) $0 $0 $101,000
Lora S. Collins 1,804 0 0 95,000
William D.
Ireland, Jr. 2,094 0 0 110,000
William E.
Mayer 1,750 0 0 89,752
John A.
McNeice, Jr. 0 0 0 0
James L. Moody,
Jr. 1,880 0 0 109,000
John J. 1,908 0 0 95,000
Neuhauser
George L. Shinn 1,974 0 0 112,000
Robert L. 2,017 0 0 104,561
Sullivan
Sinclair Weeks,
Jr. 2,090 0 0 116,000
(a) Includes $938 payable as deferred compensation.
(b) The Colonial Funds Complex consists of 31 open-end and 5
closed-end management investment company portfolios
advised by the Adviser.
The following table sets forth the amount of compensation
paid to Messrs. Birnbaum, Grinnell and Lowry in their capacities
as Trustees of the Liberty All-Star Equity Fund, The Charles
Allmon Trust, Inc., Liberty Financial Trust and LFC Utilities
Trust (together, Liberty Funds) for service during the calendar
year ended December 31, 1994:
Aggregate
Compen- Pension or
sation Retirement
From Fund Benefits Estimated Total Compensation
for the Accrued As Annual From Liberty Funds
fiscal Part of Benefits For the calendar
year ended Fund Upon year ended
Trustee 11/30/94 Expense Retirement 12/31/94 (c)
Robert J. $0 $0 $0 $ 0
Birnbaum
James E. 0 0 0 31,032
Grinnell
Richard W. 0 0 0 31,282
Lowry
(c) The Liberty Funds consist of 5 open-end and 2 closed-end
mangement investment company portfolios, each of which is
advised by Stein Roe & Farnham Incorporated, an indirect
wholly-owned subsidiary of Liberty Financial.
The Audit Committee of the Colonial Funds, consisting of
Messrs. Bleasdale, Ireland, Moody, Shinn, Sullivan and Weeks,
met twice during the fiscal year ended November 30, 1994. The
Committee recommends to the Trustees the independent accountants
to serve as auditors, reviews with the independent accountants
the results of the auditing engagement and the internal
accounting procedures and controls, and considers the
independence of the independent accountants, the range of their
audit services and their fees.
The Compensation Committee of the Colonial Funds, consisting
of Ms. Collins and Messrs. Neuhauser, Sullivan and Weeks, met
once during the fiscal year ended November 30, 1994. The
Committee reviews compensation of the Trustees.
The Nominating Committee of the Colonial Funds, consisting
of Messrs. Bleasdale, Ireland, Moody and Weeks, met once during
the fiscal year ended November 30, 1994. The Committee in its
sole discretion recommends to the Trustees nominees for Trustee
and for appointments to various committees. The Committee will
consider candidates for Trustee recommended by shareholders.
Written recommendations with supporting information should be
directed to the Committee in care of the Fund.
During the fiscal year ended November 30, 1994, each of the
current Trustees, attended more than 75% of the meetings of the
Board and the committees of which such Trustee is a member.
If any of the nominees listed above become unavailable for
election, the enclosed proxy will be voted for a substitute
candidate in the discretion of the proxy holder(s). If the
conditions set forth on page 3 are not fulfilled, the enclosed
proxy will not be voted for the election of Messrs. Birnbaum,
Grinnell and Lowry.
Required Vote
A plurality of the votes cast at the Meeting, if a quorum is
represented, is required for the election of each Trustee.
Description of the Adviser. The Adviser is a wholly-owned
subsidary of TCG. On October 12, 1994, TCG, Liberty Financial
Companies, Inc. and Apple Merger Corporation (Merger Subsidiary),
a wholly-owned subsidary of Liberty Financial, entered into an
Agreement and Plan of Merger, which was amended and restated as
of February 8, 1995 (Merger Agreement). Pursuant to the Merger
Agreement, TCG, subject to the satisfaction of certain conditions
(including, among others, adoption and approval of the Merger
Agreement by the stockholders of TCG and receipt of approvals of
new Management Agreements by the shareholders of 90% of the
Colonial Funds and the other registered investment companies for
which TCG or its subsidiaries, including the Adviser, acts as an
investment adviser, as measured by net assets), or in certain
cases, waiver of conditions, will merge with Merger Subsidiary
with TCG being the surviving corporation (Surviving Corporation).
Over 90% of the Colonial Funds' shareholders approved the new
Management Agreements at the Special Meetings of Shareholders
held on February 15, 1995. The Surviving Corporation will remain
a wholly-owned subsidary of Liberty Financial. Current TCG
stockholders will become stockholders of Liberty Financial unless
they elect to receive cash in exchange for their stock. After
the Merger, the Adviser will be a wholly-owned subsidiary of the
Surviving Corporation. The Merger, together with certain other
matters contemplated by the Merger Agreement, constitute the
Transaction.
Liberty Financial is currently an indirect subsidiary of
Liberty Mutual Insurance Company (Liberty Mutual). Liberty
Financial is a diversified and integrated asset management
organization which provides insurance and investment products to
individuals and institutions. Its principal executive offices
are located at 600 Atlantic Avenue, 24th Floor, Boston,
Massachusetts 02210. After the closing of the Transaction
(Closing), the only stockholders of Liberty Financial other than
Liberty Mutual will be those TCG stockholders who receive Liberty
Financial stock in the Merger. Liberty Mutual is a Massachusetts-
chartered mutual property and casualty insurance company with
over $20.6 billion in assets and $3.5 billion in surplus at
December 31, 1994. The principal business activities of Liberty
Mutual's subsidiaries other than Liberty Financial are property-
casulty insurance, insurance services and life insurance
(including group life and health insurance products) marketed
through its own sales force. Its principal executive offices are
located at 175 Berkeley Street, Boston, Massachusetts 02117.
John A. McNeice, Jr., who is President and a Trustee of the
Colonial Funds, presently holds 1,464,000 shares of TCG Class A
Common Stock, representing 20.24% of the Class A Common Stock of
TCG, and 98,437 shares of TCG Class B Common Stock, representing
50.94% of its outstanding Class B Stock. Because of his stock
ownership, he is considered to be a controlling person of TCG and
of the Adviser, which is a wholly-owned subsidiary of TCG. After
the Closing, Mr. McNeice will no longer be a controlling person
of the Adviser.
In connection with the Merger, unless holders of TCG Common
Stock (Common Stock) elect otherwise, each share of Common Stock
will be converted into the right to receive one share of Liberty
Financial Common Stock (New Common Stock). Alternatively, a TCG
stockholder may elect, with respect to all or some of his or her
shares, to convert such holder's Common Stock into either, but
not both, of (i) the right to receive $40.00 in cash per share of
Common Stock or (ii) the right to receive .77 shares of Series A
Convertible Preferred Stock of Liberty Financial (New Preferred
Stock) per share of Common Stock. Notwithstanding these
alternatives, the aggregate cash paid to TCG stockholders will be
limited to $100 million and the total amount of New Preferred
Stock issued to stockholders will be limited to 1,040,000 shares.
If such limits are reached, the number of shares of Common Stock
subject to elections to receive cash or New Preferred Stock, as
the case may be, will be reduced ratably based on the number of
shares elected to be so treated by each stockholder. As of
November 30, 1994, there were 7,166,646 shares of Class A Common
Stock and 193,217 shares of Class B Common Stock outstanding.
2. Ratification of Independent Accountants.
Price Waterhouse LLP was selected as independent accountants
for the Fund for the fiscal year ending November 30, 1995, by
unanimous vote of the Trustees, subject to ratification or
rejection by the shareholders. Neither Price Waterhouse LLP nor
any of its partners has any direct or material indirect financial
interest in the Fund. Price Waterhouse LLP also acts as
independent accountants for the Adviser and affiliated companies.
A representative of Price Waterhouse LLP will be available at the
Meeting to respond to appropriate questions and make a statement
(if the representative desires), if requested by a shareholder in
writing at least five days before the Meeting.
Required Vote
Ratification requires the affirmative vote of a majority of
the shares of the Fund voted at the Meeting.
3. Other Matters and Discretion of Attorneys Named in the
Proxy
At this date only the business mentioned in Items 1 and 2 of
the Notice of the Meeting is contemplated to be presented. If
any procedural or other matters properly come before the Meeting,
the enclosed proxy shall be voted in accordance with the best
judgment of the proxy holder(s).
The Meeting is called to be held at the same time as the
meeting of shareholders of Colonial Intermediate High Income
Fund. It is anticipated that such meetings will be held
simultaneously. In the event that any Fund shareholder at the
Meeting objects to the holding of a simultaneous meeting and
moves for an adjournment of the meetings so that the Meeting of
the Fund may be held separately, the persons named as proxies
will vote in favor of such an adjournment.
If a quorum of shareholders (thirty percent of the shares
entitled to vote at the Meeting) is not represented at the
Meeting or at any adjournment thereof, or, even though a quorum
is so represented, if sufficient votes in favor of the Items set
forth in the Notice of the Meeting are not received by April 28,
1995, the persons named as proxies may propose one or more
adjournments of the Meeting for a period or periods of not more
than ninety days in the aggregate and further solicitation of
proxies may be made. Any such adjournment may be effected by a
majority of the votes properly cast in person or by proxy on the
question at the session of the Meeting to be adjourned. The
persons named as proxies will vote in favor of such adjournment
those proxies which they are entitled to vote in favor of the
Items set forth in the Notice of the Meeting. They will vote
against any such adjournment those proxies required to be voted
against any of such Items.
Date for Receipt of Shareholder Proposals
Proposals of shareholders which are intended to be
considered for inclusion in the Fund's proxy statement relating
to the 1996 Annual Meeting of Shareholders of the Fund must be
received by the Fund at One Financial Center, Boston,
Massachusetts, 02111 on or before December 8, 1995.
Shareholders are urged to vote, sign and mail their proxies immediately.
COLONIAL MUNICIPAL INCOME TRUST
Proxy This Proxy is Solicited on
Behalf of the Trustees.
The undersigned shareholder hereby appoints Michael
H. Koonce, John A. McNeice, Jr. and Arthur O. Stern, and each of
them, proxies of the undersigned, with power of substitution, to
vote at the Annual Meeting of Shareholders of Colonial Municipal
Income Trust (Trust), to be held at Boston, Massachusetts, on Friday April
28, 1995, and at any adjournments, as follows on the reverse side of this card.
PLEASE MARK VOTES AS IN THIS EXAMPLE
1. ELECTION OF SEVEN TRUSTEES.
(Item 1 of the Notice)
FOR WITHHOLD FOR ALL EXCEPT
--- -------- --------------
Robert J. James E. William D. Ireland, Richard W.
Birnbaum Grinnell Jr. Lowry
William E. Robert L. George L. Shinn
Mayer Sullivan
(INSTRUCTION: To withhold authority to vote for any individual
nominee, mark the "For All Except" box and strike a line through that
nominee's name in the list above.)
2. PROPOSAL TO RATIFY THE SELECTION OF INDEPENDENT ACCOUNTANTS.
(Item 2 of the Notice)
FOR AGAINST ABSTAIN
3. IN THEIR DISCRETION, UPON SUCH OTHER MATTERS AS MAY PROPERLY COME
BEFORE THE MEETING.
This proxy, when properly executed, will be voted in the manner
directed above and, absent direction, will be voted for Items 1 and
2 listed above.
Please sign exactly as name appears to the left. When signing as attorney,
executor, administrator, trustee, or guardian, please give full title as
such. If signing for a corporation, please sign in full corporate name by
President or other authorized officer. If a partnership, please sign in
partnership name by authorized person.
Dated:------------------------, 1995
-------------------------------
Signature
-------------------------------
Signature if held jointly
PLEASE VOTE, DATE, AND SIGN ON THE OTHER SIDE AND RETURN PROMPTLY
IN THE ENCLOSED ENVELOPE.
Please sign exactly as your name
appears on the books of the Trust.
Joint owners should each sign personally
personally. Trustees and other fiduciaries
should indicate the capacity in which they
sign, and where more than one name appears,
a majority must sign.
If a corporation, this signature should
be that of an authorized officer who should
state his or her title.