EX-99.77M MERGERS 3 mnast77m.htm

Merrill Lynch Arizona Fund, Inc.

MuniAssets Fund, Inc.

File No. 811-7642

Item No. 77M (Mergers) -- Attachment

During the fiscal semi-annual period ending November 30, 2001, MuniAssets Fund, Inc. (the "Registrant") acquired substantially all of the assets and assumed substantially all of the liabilities of Merrill Lynch High Income Municipal Bond Fund, Inc. ("High Income Municipal"), File No. 811-6156.

At meetings of the Boards of Directors of the Registrant and High Income Municipal, the Boards of Directors approved an Agreement and Plan of Reorganization (the "Reorganization"). The Reorganization referred collectively to (i) the acquisition of substantially all of the assets and the assumption of substantially all of the liabilities of High Income Municipal by the Registrant, (ii) the simultaneous issuance of MuniAssets common stock to High Income Municipal, (iii) the subsequent distribution of such shares of MuniAssets common stock to the holders of High Income Municipal common stock (plus cash in lieu of fractional shares), and (iv) the dissolution of High Income Municipal and the termination of its registration under the Investment Company Act of 1940.

On July 19, 2001, in connection with the Reorganization, the Registrant filed a Registration Statement on Form N-14 (File Nos. 333-65446 and 811-7642) (the "N-14 Registration Statement"). The N-14 Registration Statement contained the proxy materials soliciting the approval of the Reorganization by the shareholders of High Income Municipal. Pre-Effective Amendment No. 1 to the N-14 Registration Statement was filed on September 10, 2001. The N-14 Registration Statement as so amended was declared effective by the Commission on September 10, 2001.

On October 24, 2001, the shareholders of the Registrant and High Income Municipal approved the Reorganization at a special meeting of shareholders held for that purpose. On December 17, 2001 (the "Reorganization Date"), pursuant to the Agreement, High Income Municipal transferred assets valued at $125,685,331.43 to the Registrant and received in exchange 9,886,013 shares of the Registrant. Such shares were then distributed to the shareholders of High Income Municipal on that date in proportion to each shareholders interest in the assets transferred.

An Application for Deregistration on Form N-8F will be filed by High Income Municipal with the Securities and Exchange Commission.