SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to Section 240.14a-11(c)
or Section 240.14a-12
Intermediate Muni Fund, Inc.
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(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (Check the appropriate box):
|_| 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
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paid previously. Identify the previous filing by the 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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INTERMEDIATE MUNI FUND, INC.
125 Broad Street
New York, New York 10004
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 24, 2002
----------------
To the Stockholders of Intermediate Muni Fund, Inc.:
The Annual Meeting of Stockholders of Intermediate Muni Fund, Inc. (the
"Fund") will be held at the Fund's offices at 125 Broad Street, New York, New
York, 11th Floor, on April 24, 2002 at 9:30 A.M. (New York Time) for the
following purposes:
1. To elect three Class III directors, each to hold office for the term
indicated and until his or her successor shall have been elected and qualified;
2. 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 March 6, 2002 as
the record date for the determination of stockholders 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
March 19, 2002
- --------------------------------------------------------------------------------
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING IN PERSON
OR BY PROXY; IF YOU DO NOT EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE,
SIGN AND RETURN THE ENCLOSED PROXY IN THE ACCOMPANYING ENVELOPE PROVIDED FOR
YOUR CONVENIENCE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
- --------------------------------------------------------------------------------
INTERMEDIATE MUNI FUND, INC.
125 Broad Street
New York, New York 10004
----------------
PROXY STATEMENT
----------------
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 24, 2002
----------------
INTRODUCTION
This proxy statement is furnished in connection with the solicitation by
the Board of Directors (the "Board") of Intermediate Muni Fund, Inc. (the
"Fund") of proxies to be voted at the Annual Meeting of Stockholders (the
"Meeting") of the Fund, to be held at the Fund's principal executive offices at
125 Broad Street, 11th Floor, New York, New York 10004, on April 24, 2002 at
9:30 a.m. (New York Time), and at any adjournments thereof, for the purposes set
forth in the accompanying Notice of Annual Meeting of Stockholders (the
"Notice").
The cost of soliciting proxies will be borne by the Fund. Proxy
solicitations will be made mainly by mail. In addition, certain officers,
directors and employees of the Fund; Salomon Smith Barney Inc. ("Salomon Smith
Barney"), which makes a market in the Fund's shares; Smith Barney Fund
Management, LLC ("SBFM" or the "Manager"), the Fund's investment manager; and/or
PFPC Global Fund Services ("PFPC"), the Fund's transfer agent, may solicit
proxies in person or by telephone, telegraph, or mail. Salomon Smith Barney is
located at 388 Greenwich Street, New York, New York 10013; SBFM is located at
333 West 34th Street, New York, New York 10001; PFPC is located at 101 Federal
Street, Boston, Massachusetts 02110.
The Annual Report of the Fund, including audited financial statements for
the fiscal year ended December 31, 2001, has previously been furnished to all
stockholders of the Fund. This proxy statement and form of proxy are first being
mailed to stockholders on or about March 20, 2002. The Fund will provide,
without charge, additional copies of the annual report to any stockholder upon
request by calling the Fund at 1-800-331-1710.
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" the proposal. 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
1
have discretionary power) will be treated as shares that are present but which
have not been voted. Because the requisite approval of the proposal is measured
by a portion of the votes actually cast, abstentions and broker "non-votes" will
have no impact on the approval of a proposal. Proposal 1 requires for approval
the affirmative vote of a plurality 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, by giving written
notice to the Secretary of the Fund at the Fund'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 to 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 Fund has fixed the close of business on
March 6, 2002 as the record date (the "Record Date") for the determination of
stockholders of the Fund entitled to notice of and to vote at the Meeting or any
adjournment thereof. Stockholders of the Fund on that 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. At the Record Date, the
Fund had outstanding 14,004,749,706 shares of Common Stock, par value $.001 per
share, the only authorized class of stock, of which 13,683,024,000 shares, or
97.7% were held in accounts, but not beneficially owned by, CEDE & CO., as
nominee for The Depository Trust Company, Box 20, Bowling Green Station, New
York, NY 10004-9998. At the Record Date, no single shareholder or "group" (as
that term is used in Section 13(d) of the Securities Exchange Act of 1934) to
the knowledge of the Board or the Fund, owned beneficially more than 5% of the
outstanding shares of the Fund. As of the Record Date, the officers and Board
members of the Fund in the aggregate beneficially owned less than 1% of the
outstanding shares of the Fund.
In the event that a quorum is not present, or if sufficient votes in favor
of the proposal 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
move for one or more adjournments of the Meeting to permit further solicitation
of proxies with respect to such proposal. In determining whether to adjourn the
Meeting, the following factors may be considered: the nature of the proposal
that is 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 stockholders with respect to
the reasons for the solicitation. Any such adjournment will require the
affirmative vote of a majority of the shares present 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 proposal.
2
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The Board of Directors of the Fund is currently classified into three
classes. The directors serving in Class III have terms expiring at the Meeting;
the Class III Directors currently serving on the Board have been nominated by
the Board of Directors for re-election at the Meeting to serve for a term of
three years (until the 2005 Annual Meeting of Stockholders) or until their
successors have been duly elected and qualified. The affirmative vote of a
plurality of the votes cast at the Meeting at which a quorum is present is
sufficient to elect each nominee. It is the intention of the persons named in
the enclosed proxy to vote in favor of the election of the persons listed below
as nominees.
The Board knows of no reason why any of the Class III nominees listed
below will be unable to serve, but in the event of any such unavailability, the
proxies received will be voted for such substitute nominees as the Board may
recommend.
Certain information concerning the nominees is set forth below. All of the
nominees for Class III currently serve as Directors of the Fund. Any director
affiliated with the Manager or otherwise considered an "interested person" of
the Fund, as defined in the Investment Company Act of 1940, as amended (the
"1940 Act") is indicated by an asterisk (*). Information as to beneficial
ownership is based upon information furnished to the Fund by Directors.
Persons Nominated for Election as Directors
Number of
Investment
Companies
Advised by
Term of SBFM and
Position Office and Principal Overseen By Other
Held Length of Occupation(s) Nominee Directorships
with Time During Past (including Held by
Name, Address and Age Fund Served** Five Years the Fund) Director
- --------------------- -------- ---------- ------------- ----------- -------------
Lee Abraham Director Since 1999 Retired; Former Chair- 9 Signet Group
13732 LeHavre Dr. rman and CEO of
Frenchman's Creek Associated Merchan-
Palm Beach Gardens, FL dising Corp., a major
33410 retail merchandising
Age: 74 organization. Former
Director of Galey &
Lord, Liz Claiborne,
R.G. Barry Corporation
and eNote.Com Inc.
Jane F. Dasher Director Since 1999 Controller of PBK 9 N/A
Korsant Partners Holdings Inc., a
283 Greenwich Avenue family investment
3rd Fl company
Greenwich, CT 06830
Age: 52
Donald R. Foley Director Since 1999 Retired 9 N/A
3668 Freshwater Drive
Jupiter, FL 33477
Age:79
** Directors are elected for a term of three years or until their successors
have been duly elected and qualified.
3
The remainder of the Board currently constitutes the Class I and Class II
directors, none of whom will stand for election at the Meeting, as their terms
are not due to expire until the year 2003 and 2004, respectively.
Directors Continuing in Office
CLASS I DIRECTORS
Number of
Investment
Companies
Advised by
Term of SBFM and
Position Office and Principal Overseen By Other
Held Length of Occupation(s) Nominee Directorships
with Time During Past (including Held by
Name, Address and Age Fund Served** Five Years the Fund) Director
- --------------------- -------- ---------- ------------- ----------- -------------
Heath B. McLendon* Director/ Since Managing Director of 74 N/A
Salomon Smith Barney Chairman 1995 Salomon Smith Barney
125 Broad Street, 9th Fl ("SSB"); President and
New York, NY 10004 Director of Smith Barney
Age:68 Fund Management LLC
("SBFM") and Travelers
Investment Adviser, Inc.
("TIA"), The Travelers
Investment Management
Company ("TIMCO"),
Trustee Drew University
Advisory Director M&T
Bank
Allan J. Bloostein Director Since President of Allan Bloostein 16 Taubman
27 West 67th Street 1999 Associates, a consulting Centers Inc.
Apt. 5FW firm. Former Director of
New York, NY 10023 CVS Corporation
Age: 72
Richard E. Hanson, Jr. Director Since Retired; Former Head of 9 N/A
2751 Vermont Route 140 1999 the New Atlanta Jewish
Poultney, VT 05760 Community High School
Age: 60
CLASS II DIRECTORS
Dr. Paul Hardin Director Since Professor of Law and 17 N/A
12083 Morehead 1994 Chancellor Emeritus at
Chapel Hill, NC the University of
27514-8426 North Carolina
Age: 70
Roderick C. Rasmussen Director Since Investment Counselor 9 N/A
9 Cadence Court 1993
Morristown, NJ 07960
Age: 75
John P. Toolan Director Since Retired 9 Trustee John
7202 Southeast 1993 Hancock
Golf Ridge Way Funds
Hobe Sound, Fl 33455
Age: 71
- ----------
* Mr. McLendon is an "interested person" as defined in the 1940 Act.
** Directors are elected for a term of three years or until their successors
have been duly elected and qualified.
4
The following table provides information concerning the dollar range of equity
securities beneficially owned by each Director and nominee for election as
Director:
Aggregate Dollar Range of Equity
Dollar Range Equity Securities in All Funds Overseen by
Name of Director/Nominee Securities in the Fund Director/Nominee and Advised by SBFM
- ------------------------ ---------------------- ------------------------------------
Lee Abraham None None
Allan J. Bloostein None Over $100,000
Jane F. Dasher None $10,001-$50,000
Donald R. Foley $50,001-$100,000 Over $100,000
Richard E. Hanson None $1-$10,000
Paul Hardin None Over $100,000
Heath B. McLendon* $10,001-$50,000 Over $100,000
Roderick C. Rasmussen $1-$10,000 $10,001-$50,000
John P. Toolan None Over $100,000
- ----------
* Mr. McLendon is an "interested person" as defined in the 1940 Act.
Beneficial Ownership Report
Section 16(a) of the Securities Exchange Act of 1934 requires the Fund's
officers and directors, and persons who beneficially own more than ten percent
of a registered class of the Fund's equity securities, to file reports of
ownership with the Securities and Exchange Commission, the American Stock
Exchange and the Fund. Based solely upon its review of the copies of such forms
received by it and representations from such persons, the Fund believes that,
during fiscal year 2001, all filing requirements applicable to such persons were
satisfied.
Committees of the Board of Directors
The Fund has no compensation committee of the Board of Directors, or any
committee performing similar functions. The Fund has an administrative and
governance committee composed of Lee Abraham, Donald R. Foley, Richard E.
Hanson, Jr., and Paul Hardin, which acts as a nominating committee of the Board
of Directors. The Fund has an audit and investment performance committee
comprised solely of members who are independent. The audit committee is charged
with recommending a firm of independent auditors to the Board of Directors and
reviewing the Fund's accounting matters as set forth in the committee's charter,
which is attached hereto as Appendix A. The Directors of these respective
committees are not "interested persons" of the Fund as defined under the 1940
Act (the "independent directors").
Eight meetings of the Board were held between January 1, 2001 and December
31, 2001, four of which were regular meetings. Four administrative and
governance committee meetings were held. One Audit Committee meeting was also
held. There were no nominating committee meetings held. No incumbent Director
attended less than 75% of these meetings.
5
COMPENSATION
Only the independent directors receive remuneration from the Fund for
acting as a director. Aggregate fees and expenses (including reimbursement for
travel and out-of-pocket expenses) of $13,380 were paid to such directors by the
Fund Complex during the fiscal year ended on December 31, 2001. Fees for the
independent directors, who also serve as board members of certain other funds
sponsored by or affiliated with Salomon Smith Barney, are currently set at
$60,000 per annum plus a per meeting fee of $2,500, with respect to in-person
meetings and $100 for each telephone meeting. None of the officers of the Fund
received any compensation from the Fund for such period. Officers and interested
directors of the Fund are compensated by Salomon Smith Barney.
The following table shows the compensation paid by the Fund to each person
who was a Director during the Fund's last fiscal year ended December 31, 2001:
Compensation Table
Compensation
from Fund
Aggregate and Fund Total
Compensation Pension or Complex Number of
from Fund Retirement Paid to Directors Funds for
for the Fiscal Benefits Accrued for the Calendar Which Director
Year Ended as part of Year Ended Serves within
Name of Person 12/31/01 Portfolio Expenses 12/31/01 Fund Complex
- -------------- -------------- ------------------ ----------------- --------------
Lee Abraham $ 129 0 $ 73,500 9
Allan J. Bloostein 191 0 117,100 16
Jane F. Dasher 229 0 74,700 9
Donald R. Foley* 97 0 49,900 9
Richard E. Hanson, Jr. 129 0 73,800 9
Paul Hardin 129 0 110,800 17
Heath B. McLendon+ 0 0 0 74
Roderick C. Rasmussen* 189 0 44,200 9
John P. Toolan* 0 0 0 0
- ----------
+ Designates a director who is an "interested person" of the Fund as defined
under the 1940 Act.
* Pursuant to the Fund's deferred compensation plan, the indicated Directors
have elected to defer the following amounts of their compensation from the
Fund: Donald R. Foley: $29, Roderick C. Rasmussen: $20 and John P. Toolan:
$229, and the following amounts of their total compensation from the Fund
Complex: Donald R. Foley: $21,600, Roderick C. Rasmussen: $15,000 and John
P. Toolan: $74,100.
Upon attainment of age 72 the Fund's current directors may elect to change
to emeritus status. Any directors elected or appointed to the Board of
Directors in the future will be required to change to emeritus status upon
attainment of age 80. 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 otherwise applicable to the Fund's directors,
together with reasonable out-of-pocket expenses for each meeting attended.
During the Fund's last fiscal year, total compensation paid by the Fund to
Directors Emeritus totalled $47.
6
Audit Committee Report
The purposes of the Fund's Audit Committee are set forth in the Charter
included as Appendix A. The purposes include assisting the Board of Directors in
its oversight of the Fund's financial reporting process and internal controls,
the Fund's financial statements and the selection of the Fund's independent
accountants. Management, however, is responsible for the preparation,
presentation and integrity of the Fund's financial statements, and the
independent accountants are responsible for planning and carrying out proper
audits and reviews.
In connection with the audited financial statements as of and for the year
ended December 31, 2001 included in the Fund's Annual Report for the year ended
December 31, 2001 (the "Annual Report"), at a meeting held on February 20, 2002,
the Audit Committee considered and discussed the audited financial statements
with management and the independent accountants, and discussed the audit of such
financial statements with the independent accountants.
In addition, the Audit Committee discussed with the independent
accountants the quality, and not just the acceptability under generally accepted
accounting principles, of the accounting principles applied by the Fund, and
such other matters brought to the attention of the Audit Committee by the
independent accountants required by Statement of Auditing Standards No. 61, as
currently in effect. The Audit Committee also received from the independent
accountants the written statement required by Independence Standards Board
Statement No. 1, as currently in effect, delineating relationships between the
independent accountants and the Fund and discussed the impact that any such
relationships may have on the objectivity and independence of the independent
accountants.
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
accounting or auditing including auditor independence. Moreover, the Committee
relies on and makes no independent verification of the facts presented to it or
representations made by management or 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 provide any assurance that the audit of the Fund's
financial statements has been carried out in accordance with generally accepted
accounting standards, that the financial statements are presented in accordance
with generally accepted accounting principles or that the Fund's auditors are in
fact "independent."
The Audit Committee also met on February 20, 2002 (to consider and discuss
the audit committee charter for the year ended December 31, 2001 with management
and the independent accountants).
7
Based on its consideration of the audited financial statements and the
discussions referred to above with management and the independent accountants
and subject to the limitations on the responsibilities and role of the Audit
Committee set forth in the Charter and those discussed above, the Committee
recommended to the Board of Directors that the audited financial statements be
included in the Fund's Annual Report.
Respectfully submitted,
Allan J. Bloostein Roderick C. Rasmussen
Richard E. Hanson John P. Toolan
8
Current Officers
The following is a list of the current executive officers of the Fund, all
of whom have been elected by the directors to serve until their respective
successors are elected:
Position(s) Length of Principal Occupation(s) During
Name, Address and Age Held with Fund Time Served Past Five Years
- --------------------- ------------------- ------------- ------------------------------
Heath B. McLendon Chairman of the 1995 to date (see table of directors on page 4)
Salomon Smith Barney Board, President and
125 Broad Street, 9th Fl Chief Executive
New York, NY 10004 Officer
Age: 68
Lewis E. Daidone Senior Vice President 1992 to date Managing Director of Salomon
Salomon Smith Barney and Treasurer Smith Barney; Senior Vice President or
125 Broad Street Executive Vice President and Treasurer
New York, NY 10004 of 73 investment companies associated
Age: 44 with Citigroup; Director and Senior Vice
President of the Manager and TIA.
Peter M. Coffey Vice President 1992 to date Managing Director of Salomon Smith
Salomon Smith Barney Barney and investment officer of certain
333 West 34th Street other investment companies associated
New York, NY 10001 with Citigroup.
Age: 57
Christina T. Sydor Secretary 1992 to date Managing Director of Salomon Smith
Salomon Smith Barney Barney; Secretary of 57 investment
300 First Stanford Place companies associated with Citigroup;
Stamford, CT 06902 Secretary and General Counsel of the
Age: 51 Manager and TIA.
Paul Brook Controller 1998 to date Director of Salomon Smith Barney and
Salomon Smith Barney Controller or Assistant Treasurer of 39
125 Broad Street investment companies associated with
New York, NY 10004 Citigroup; Prior to 1998, Managing
Age: 48 Director of AMT Capital Services Inc.; Prior
to 1997, Partner with Ernst & Young LLP.
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS,
RECOMMENDS THAT YOU VOTE "FOR" THE ELECTION OF NOMINEES TO THE BOARD.
Disclosure of Auditor Fees
Audit Fees. Audit fees billed by the Fund to KPMG LLP ("KPMG") in
connection with the Fund's annual audit for the year ended December 31, 2001 was
$14,000.
Financial Information Systems Design and Implementation. KPMG was not
engaged by the Fund, its investment adviser, or any entity controlling,
controlled by, or under common control with the investment adviser that provides
services to the Fund, to provide financial information systems design or
implementation services.
All other Fees. The aggregate fees billed for non-audit services by KPMG
and paid by the Fund, its investment adviser, or any entity controlling,
controlled by, or under common control with the investment adviser that provides
services to the Fund was $5,300 (tax compliance services).
9
SUBMISSION OF STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at its 2003 Annual Meeting
of Stockholders of the Fund must be received by December 25, 2002 to be included
in the proxy statement and the form of proxy relating to that meeting, as the
Fund expects that the 2003 Annual Meeting of Stockholders will be held in April
of 2003. 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 regulations under the federal securities laws.
The persons named as proxies for the Annual Meeting of Stockholders for
2003 will 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 March 10, 2003, in which case these persons will not have
discretionary voting authority except as provided in the Securities and Exchange
Commission's rules governing stockholder proposals.
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.
By Order of the Board of Directors,
Christina T. Sydor
Secretary
March 18, 2002
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.
10
Appendix A
FORM OF
CLOSED END FUNDS
AUDIT COMMITTEE CHARTER
INTERMEDIATE MUNI FUND, INC.
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 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 American 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, policies and controls, and audit processes;
2. in its oversight of the Company's financial statements and the
independent audit thereof;
3. in selecting, 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 of
the Company's annual financial statement 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
including the issue of auditor independence. 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 or to set auditor
independence standards, 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 from which it receives information (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) and (iii) representations made by
management of the Company or of Smith Barney Fund
A-1
Management LLC ("SBFM") as to any information technology, internal audit and
other non-audit services provided by the outside auditors of the Company to the
Company, SBFM and any entity controlling, controlled by or under common control
with SBFM that provides services to the Company ("SBFM Affiliates").
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 the ultimate authority and
responsibility to select, evaluate and, where appropriate, replace the outside
auditors.
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 judgement may be reasonably thought to bear on independence,
addressing each non-audit service provided to the Company, SBFM and the SBFM
Affiliate and at least the matters set forth in Independence Standards Board No.
1. The Statement as to Independence shall also identify any audit, tax or
consulting services to the custodian, or other service providers to the Company,
and to other investment companies advised by the Company's investment adviser or
administered by the Company's administrator, as the Audit Committee and the
outside auditors may agree. These professional services may include those
relating to the services provided by such service providers to the Company or
any other services that the outside auditors or the Committee believe may bear
on the outside auditor independence with respect to the Company. The Audit
Committee acknowledges that the disclosure of such services provided by the
outside auditors may be limited by the Code of Professional Conduct of the
American Institute of Certified Public Accountants.
The outside auditors shall submit to the Company annually a formal written
statement of the fees billed for each of the following categories of services
rendered by the outside auditors: (i) the audit of the Company's financial
statements; (ii) information technology consulting services provided to the
Company, SBFM, and the SBFM Affiliates for the most recent fiscal year, in the
aggregate and, (iii) all other services provided to the Company, SBFM, and the
SBFM Affiliates by the outside auditors for the most recent fiscal year, in the
aggregate.
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:
A-2
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. If applicable, to consider whether the outside auditors'
provision to the Company, SBFM Affiliates of (a) information technology
consulting services relating to financial information systems design and
implementation and (b) other non-audit services is compatible with
maintaining the independence of the outside auditors; and
5. to instruct the auditors that the outside auditors are ultimately
accountable to the Board of Directors and Audit Committee;
6. 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;
7. 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:
o deficiencies noted in the audit in the design or operation of
internal controls;
o consideration of fraud in a financial statement audit;
o detection of illegal acts;
o the outside auditors' responsibility under generally accepted
auditing standards;
o significant accounting policies;
o management judgments and accounting estimates;
o adjustments arising from the audit;
o the responsibility of the outside auditors for other
information in documents containing audited financial
statements;
o disagreements with management;
o consultation by management with other accountants;
A-3
o major issues discussed with management prior to retention of
the outside auditors;
o difficulties encountered with management in performing the
audit;
o the outside auditors' judgments about the quality of the
entity's accounting principles; and
o reviews of interim financial information conducted by the
outside auditors; (not applicable) and
8. with respect to reporting and recommendations, to discuss with
the Company's General Counsel any significant legal matters may have a
material effect on the financial statements, the Company's compliance
policies, including material notices to or inquiries received from
governmental agencies;
9. to prepare any report or other disclosures, 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;
10. to review this Charter at least annually and recommend any
changes to the full Board of Directors; and
11. 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-4
PROXY
INTERMEDIATE MUNI FUND, INC.
125 Broad Street
New York, New York 10004
This Proxy is Solicited on Behalf of the Board of Directors of the Fund
The undersigned hereby appoints HEATH B. McLENDON, CHRISTINA T. SYDOR and GORDON
E. SWARTZ,and each of them acting in absence of the other, as Proxies, each with
the power to appoint a substitute, and hereby authorizes them to represent and
to vote, as designated herein, all the shares of common stock of Intermediate
Muni Fund, Inc. held of record by the undersigned on March 6, 2002 at a Meeting
of Shareholders to be held on April 24, 2002 or any adjournment thereof.
- ----------- -----------
SEE REVERSE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SEE REVERSE
SIDE SIDE
- ----------- -----------
- --------------------------------------------------------------------------------
Please mark
|X| votes as in
this example.
This proxy, when properly executed, will be voted in the manner directed by the
undersigned shareholder. If no direction is made, this proxy will be voted FOR
each nominee for director.
The Board of Directors recommends a vote "FOR" the following proposal:
1. ELECTION OF DIRECTORS:
Nominees: (01) Lee Abraham, (02) Jane F. Dasher and
(03) Donald R. Foley
2. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
FOR WITHHELD
ALL |_| FROM ALL |_|
NOMINEES NOMINEES
|_| --------------------------------------
For all nominees except as noted above
|_| MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT
PLEASE MARK, SIGN, DATE, AND RETURN THE PROXY CARD
PROMPTLY USING THE ENCLOSED ENVELOPE.
Please sign exactly as name appears to the left. When shares are held by joint
tenants, both should sign, or if one signs, that shareholder's vote binds both
shareholders. When signing as attorney, executor, administrator, agent, trustee,
or guardian, please give full title as such. If a corporation, please sign in
full corporate name by a President or other authorized officer. If a
partnership, please sign in partnership name by authorized person.
Signature:_______________ Date:________ Signature:________________ Date:________