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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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<SEC-DOCUMENT>0000950109-01-504943.txt : 20020410
<SEC-HEADER>0000950109-01-504943.hdr.sgml : 20020410
ACCESSION NUMBER:		0000950109-01-504943
CONFORMED SUBMISSION TYPE:	DEF 14A
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20011212
FILED AS OF DATE:		20011113

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			MUNIHOLDINGS INSURED FUND II INC
		CENTRAL INDEX KEY:			0001071899
		STANDARD INDUSTRIAL CLASSIFICATION:	 []
		IRS NUMBER:				223636347
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		DEF 14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	811-09191
		FILM NUMBER:		1784504

	BUSINESS ADDRESS:	
		STREET 1:		C/O MERRILL LYNCH ASSET MANAGEMENT
		STREET 2:		800 SCUDDERS MILL RD
		CITY:			PLAINSBORO
		STATE:			NJ
		ZIP:			08536
		BUSINESS PHONE:		6092823087

	MAIL ADDRESS:	
		STREET 1:		C/O MERRILL LYNCH ASSET MANAGEMENT
		STREET 2:		PO BOX 9011, INFO SYSTEMS SECT 2-B
		CITY:			PRINCETON
		STATE:			NJ
		ZIP:			08543-9011
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>ddef14a.htm
<DESCRIPTION>MUNIHOLDINGS INSURED FUND II (N&P)
<TEXT>
<HTML>
<HEAD>
 <TITLE>MUNIHOLDINGS INSURED FUND II (N&amp;P)</TITLE>
</HEAD>
<BODY BGCOLOR="#FFFFFF">
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"> <B>As filed with the Securities and Exchange Commission on November 13, 2001.</B></FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>SCHEDULE 14A INFORMATION</B></FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES</B></FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>EXCHANGE ACT OF 1934 (AMENDMENT NO.&nbsp;&nbsp;&nbsp;&nbsp;)</B></FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" ALIGN="center" CELLSPACING=0 CELLPADDING=0>
<TR>
<TD VALIGN="top" ALIGN="left"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Filed by the Registrant&nbsp;&nbsp;</FONT><FONT SIZE="2" COLOR="#000000" FACE="Wingdings">&#120;</FONT><FONT SIZE="2" COLOR="#000000"
FACE="'Times New Roman', Times"></FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Filed by a Party other than the Registrant&nbsp;&nbsp;</FONT><FONT SIZE="2" COLOR="#000000" FACE="Wingdings">&#168;</FONT><FONT SIZE="2" COLOR="#000000"
FACE="'Times New Roman', Times"></FONT></DIV>
</TD>
<TD WIDTH="4%"></TD>
<TD VALIGN="top" ALIGN="center"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Check the appropriate box:</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"></FONT><FONT SIZE="2" COLOR="#000000" FACE="Wingdings">&#168;</FONT><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;Preliminary
Proxy Statement</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"></FONT><FONT SIZE="2" COLOR="#000000" FACE="Wingdings">&#168;</FONT><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;Confidential,
for Use of the Commission Only</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(as permitted by Rule 14a-6(e)(2))</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"></FONT><FONT SIZE="2" COLOR="#000000" FACE="Wingdings">&#120;</FONT><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;Definitive
Proxy Statement</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"></FONT><FONT SIZE="2" COLOR="#000000" FACE="Wingdings">&#168;</FONT><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;Definitive
Additional Materials</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"></FONT><FONT SIZE="2" COLOR="#000000" FACE="Wingdings">&#168;</FONT><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;Soliciting
Material Pursuant to Section 240.14a-12</FONT></DIV>
</TD>
<TD WIDTH="1%"></TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>MUNIHOLDINGS INSURED FUND II, Inc.</B></FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>P.O. Box 9011</B></FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>Princeton, New Jersey 08543-9011</B></FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><HR WIDTH="52%" SIZE="1" NOSHADE></DIV>
<DIV ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>(Name of Registrant as Specified In Its Charter)</B></FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><HR WIDTH="52%" SIZE="1" NOSHADE></DIV>
<DIV ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>(Name of Person(s) Filing Proxy Statement, if other than Registrant)</B></FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Payment of Filing Fee (Check the appropriate box):</FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"></FONT><FONT SIZE="2" COLOR="#000000" FACE="Wingdings">&#120;</FONT><FONT SIZE="2" COLOR="#000000"
FACE="'Times New Roman', Times"> No fee required.</FONT></DIV>
</TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"></FONT><FONT SIZE="2" COLOR="#000000" FACE="Wingdings">&#168;</FONT><FONT SIZE="2" COLOR="#000000"
FACE="'Times New Roman', Times"> Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.</FONT></DIV>
</TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(1) Title of each class of securities to which transaction applies:</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="91%" VALIGN="top"> <HR SIZE=1 NOSHADE> </TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(2) Aggregate number of securities to which transaction applies:</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="91%" VALIGN="top"> <HR SIZE=1 NOSHADE> </TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"><DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(3)</FONT></DIV>
</TD>
<TD WIDTH="92%" ALIGN="left" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on
which the filing fee is calculated and state how it was determined):</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="91%" VALIGN="top"> <HR SIZE=1 NOSHADE> </TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(4) Proposed maximum aggregate value of transaction:</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="91%" VALIGN="top"> <HR SIZE=1 NOSHADE> </TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(5) Total fee paid:</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="91%" VALIGN="top"> <HR SIZE=1 NOSHADE> </TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"></FONT><FONT SIZE="2" COLOR="#000000" FACE="Wingdings">&#168;</FONT><FONT SIZE="2" COLOR="#000000"
FACE="'Times New Roman', Times"> Fee paid previously with preliminary materials.</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="91%" VALIGN="top"> <HR SIZE=1 NOSHADE> </TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"></FONT><FONT SIZE="2" COLOR="#000000" FACE="Wingdings">&#168;</FONT><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;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.</FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(1) Amount Previously Paid:</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="91%" VALIGN="top"> <HR SIZE=1 NOSHADE> </TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(2) Form, Schedule or Registration Statement No.:</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="91%" VALIGN="top"> <HR SIZE=1 NOSHADE> </TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(3) Filing Party:</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="91%" VALIGN="top"> <HR SIZE=1 NOSHADE> </TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(4) Date Filed:</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="91%" VALIGN="top"> <HR SIZE=1 NOSHADE> </TD>
</TR>
</TABLE>
<DIV><FONT SIZE="6">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"> <B>MUNIHOLDINGS INSURED FUND II, INC.</B></FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>P.O. Box 9011</B></FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>Princeton, New Jersey 08543-9011</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><HR WIDTH="21%" SIZE="1" NOSHADE></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>NOTICE OF 2001 ANNUAL MEETING OF STOCKHOLDERS</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>December 12, 2001</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><HR WIDTH="21%" SIZE="1" NOSHADE></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">T<SMALL>O THE </SMALL>
S<SMALL>TOCKHOLDERS OF </SMALL>
M<SMALL>UNIHOLDINGS </SMALL>
I<SMALL>NSURED </SMALL>
F<SMALL>UND </SMALL>
II, I<SMALL>NC</SMALL>
 .:</FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOTICE IS HEREBY GIVEN that the 2001 Annual Meeting of Stockholders (the &#147;Meeting&#148;) of MuniHoldings Insured
Fund II, Inc. (the &#147;Fund&#148;) will be held at the offices of Merrill Lynch Investment Managers, L.P., 800 Scudders Mill Road, Plainsboro, New Jersey, on Wednesday, December 12, 2001 at 10:20 a.m. for the following purposes:</FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;&nbsp;&nbsp;To elect a Board of Directors to serve for the ensuing year; and</FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;&nbsp;&nbsp;To transact such other business as may properly come before the Meeting or any adjournment
thereof.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors has fixed the close of business on October 25, 2001 as the record date for the determination of
stockholders entitled to notice of and to vote at the Meeting or any adjournment thereof.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A complete list of the stockholders of the Fund entitled to vote at the Meeting will be available and open to the
examination of any stockholder of the Fund for any purpose germane to the Meeting during ordinary business hours from and after November 28, 2001, at the office of the Fund, 800 Scudders Mill Road, Plainsboro, New Jersey. You are cordially invited
to attend the Meeting. <B>Stockholders who do not expect to attend the meeting in person are requested to complete, date and sign the enclosed form of proxy and return it promptly in the envelope provided for this purpose. If you have been provided
with the opportunity on your proxy card or voting instruction form to provide voting instructions via telephone or the Internet, please take advantage of these prompt and efficient voting options. </B>The enclosed proxy is being solicited on behalf
of the Board of Directors of the Fund.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If you have any questions regarding the enclosed proxy material or need assistance in voting your shares, please contact
our proxy solicitor, Georgeson Shareholder at 1-800-645-4519.</FONT></DIV>
<DIV><FONT SIZE="3">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="52%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="48%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">By Order of the Board of Directors</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="52%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="48%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">B<SMALL>RADLEY </SMALL>
J. L<SMALL>UCIDO</SMALL>
</FONT></DIV>
</TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="52%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="48%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><I>Secretary</I></FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Plainsboro, New Jersey</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Dated: November 13, 2001</FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> <B>PROXY STATEMENT</B></FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><HR WIDTH="21%" SIZE="1" NOSHADE></DIV>
<DIV><FONT SIZE="3">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>MUNIHOLDINGS INSURED FUND II, INC.</B></FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>P.O. Box 9011</B></FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>Princeton, New Jersey 08543-9011</B></FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><HR WIDTH="21%" SIZE="1" NOSHADE></DIV>
<DIV><FONT SIZE="3">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>2001 ANNUAL MEETING OF STOCKHOLDERS</B></FONT></DIV>
<DIV><FONT SIZE="3">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><HR WIDTH="21%" SIZE="1" NOSHADE></DIV>
<DIV><FONT SIZE="3">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>December 12, 2001</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>INTRODUCTION</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Proxy Statement is furnished in connection with the solicitation of proxies on behalf of the Board of Directors of
MuniHoldings Insured Fund II, Inc., a Maryland corporation (the &#147;Fund&#148;), to be voted at the 2001 Annual Meeting of Stockholders of the Fund (the &#147;Meeting&#148;), to be held at the offices of Merrill Lynch Investment Managers, L.P.
(&#147;MLIM&#148;), 800 Scudders Mill Road, Plainsboro, New Jersey, on Wednesday, December 12, 2001 at 10:20 a.m. The approximate mailing date of this Proxy Statement is November 14, 2001.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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, proxies will be voted <I>for </I>the election of the Board of Directors to serve for the ensuing year. Any proxy may be revoked at any time
prior to the exercise thereof by giving written notice to the Secretary of the Fund at the Fund&#146;s address indicated above or by voting in person at the Meeting.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors has fixed the close of business on October 25, 2001 as the record date (the &#147;Record
Date&#148;) for the determination of stockholders entitled to notice of and to vote at the Meeting and at any adjournment thereof. Stockholders on the Record Date will be entitled to one vote for each share held, with no shares having cumulative
voting rights. As of the Record Date, the Fund had outstanding 22,352,426 shares of common stock, par value $.10 per share (&#147;Common Stock&#148;), and 8,180 shares of auction market preferred stock, par value $.10 per share and liquidation
preference of $25,000 per share plus an amount equal to accumulated but unpaid dividends thereon (&#147;AMPS&#148;). To the knowledge of the Fund, as of the Record Date, no person is the beneficial owner of more than five percent of the outstanding
shares of Common Stock or five percent of the outstanding AMPS.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors of the Fund knows of no business other than that mentioned in Item 1 of the Notice of Meeting
that will be presented for consideration at the Meeting. If any other matter is properly presented, it is the intention of the persons named in the enclosed proxy to vote in accordance with their best judgment.</FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> <B>ITEM 1.&nbsp;&nbsp;&nbsp;&nbsp;ELECTION OF DIRECTORS</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At the Meeting, the Board of Directors will be elected to serve until the next Annual Meeting of Stockholders and until
their successors are elected and qualified. It is intended that all properly executed proxies will be voted (unless such authority has been withheld in the proxy) as follows:</FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;&nbsp;All such proxies of the holders of shares of AMPS, voting
separately as a class, in favor of the two (2) persons designated as Directors to be elected by holders of AMPS; and</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;&nbsp;All such proxies of the holders of shares of Common Stock and
AMPS, voting together as a single class, will be voted in favor of the three (3) persons designated as Directors to be elected by holders of Common Stock and AMPS.</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors of the Fund knows of no reason why any of these nominees will be unable to serve, but in the
event of any such unavailability, the proxies received will be voted for such substitute nominee or nominees as the Board of Directors may recommend.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certain information concerning the nominees is set forth as follows:</FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>To Be Elected By Holders of AMPS, Voting Separately as a Class:</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>

<TABLE ALIGN="center" WIDTH="614" CELLSPACING=0 CELLPADDING=0>
<TR>
<TH ROWSPAN=2 VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Name and Address of Nominee</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH ROWSPAN=2 VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Age</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH ROWSPAN=2 VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Principal Occupation During Past
<BR>
Five Years and Public Directorships(1)</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH ROWSPAN=2 VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Director
<BR>
Since</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH COLSPAN=3 VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Shares Beneficially
<BR>
Owned at the
<BR>
Record Date</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
</TR>
<TR>
<TH></TH>
<TH></TH>
<TH></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Common
<BR>
Stock</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>AMPS</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
</TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Melvin R. Seiden(1)(2)
<BR>
780 Third Avenue
<BR>
Suite 2502
<BR>
New York, New York 10017</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">71</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Director of Silbanc Properties, Ltd. (real estate,
<BR>
investment and consulting) since 1987; Chairman
<BR>
and President of Seiden &amp; de Cuevas, Inc. (private
<BR>
investment firm) from 1964 to 1987.</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">0</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">0</FONT></TD>
</TR>
<TR>
<TD COLSPAN=11 ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TR>
<TD COLSPAN=11><FONT SIZE="1">&nbsp;</FONT></TD>
</TR>
<TR><TD> </TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Robert S. Salomon, Jr.(1)(2)
<BR>
106 Dolphin Cove Quay
<BR>
Stamford, Connecticut 06902</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">64</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Principal of STI Management (investment adviser)
<BR>
since 1994; Chairman and CEO of Salomon
<BR>
Brothers Asset Management from 1992 until 1995;
<BR>
Chairman of Salomon Brothers equity mutual funds
<BR>
from 1992 until 1995; regular columnist with<I>
<BR>
Forbes</I> magazine since 1992; Director of Stock
<BR>
Research and U.S. Equity Strategist at Salomon
<BR>
Brothers Inc. from 1975 until 1991; Trustee,
<BR>
Commonfund from 1980 to 2001.</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">0</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">0</FONT></TD>
</TR>
</TABLE>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> <B>To Be Elected By Holders of Common Stock and AMPS, Voting Together as a Single Class:</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>

<TABLE ALIGN="center" WIDTH="614" CELLSPACING=0 CELLPADDING=0>
<TR>
<TH ROWSPAN=2 VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Name and Address of Nominee</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH ROWSPAN=2 VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Age</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH ROWSPAN=2 VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Principal Occupation During Past
<BR>
Five Years and Public Directorships(1)</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH ROWSPAN=2 VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Director
<BR>
Since</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH COLSPAN=3 VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Shares
<BR>
Beneficially
<BR>
Owned at the
<BR>
Record Date</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
</TR>
<TR>
<TH></TH>
<TH></TH>
<TH></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Common
<BR>
Stock</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>AMPS</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
</TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Terry K. Glenn(1)*
<BR>
P.O. Box 9011
<BR>
Princeton, New Jersey 08543-
<BR>
9011</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">61</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Chairman (Americas Region) of MLIM since 2001;
<BR>
Executive Vice President of MLIM and Fund Asset
<BR>
Management, L.P. (&#147;FAM&#148;) (which terms as used
<BR>
herein include their corporate predecessors) since
<BR>
1983; Executive Vice President and Director of
<BR>
Princeton Services, Inc. (&#147;Princeton Services&#148;)
<BR>
since 1993; President of Merrill Lynch Mutual
<BR>
Funds since 1999; President of FAM Distributors,
<BR>
Inc. (&#147;FAMD&#148;) since 1986 and Director thereof
<BR>
since 1991; President of Princeton Administrators,
<BR>
L.P. since 1988; Director of Financial Data
<BR>
Services, Inc. since 1985.</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">0</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">0</FONT></TD>
</TR>
<TR>
<TD COLSPAN=11 ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TR>
<TD COLSPAN=11><FONT SIZE="1">&nbsp;</FONT></TD>
</TR>
<TR><TD> </TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Joe Grills(1)(2)
<BR>
P.O. Box 98
<BR>
Rapidan, Virginia 22733</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">66</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Member of the Committee of Investment of Employee
<BR>
Benefit Assets of the Association of Financial
<BR>
Professionals (&#147;CIEBA&#148;) since 1986; Member of
<BR>
CIEBA&#146;s Executive Committee since 1988 and its
<BR>
Chairman from 1991 to 1993; Assistant Treasurer of
<BR>
International Business Machines Corporation
<BR>
(&#147;IBM&#148;) and Chief Investment Officer of IBM
<BR>
Retirement Funds from 1986 until 1993; Member of
<BR>
the Investment Advisory Committee of the State of
<BR>
New York Common Retirement Fund since 1989;
<BR>
Member of the Investment Advisory Committee of
<BR>
the Howard Hughes Medical Institute from 1997 to
<BR>
2000; Director, Duke Management Company since
<BR>
1992 and Vice Chairman thereof since 1998;
<BR>
Director, LaSalle Street Fund from 1995 to 2001;
<BR>
Director, Kimco Realty Corporation since 1997;
<BR>
Member of the Investment Advisory Committee of
<BR>
the Virginia Retirement System since 1998;
<BR>
Director, Montpelier Foundation since 1998 and its
<BR>
Vice Chairman since 2000; Member of the
<BR>
Investment Committee of the Woodberry Forest
<BR>
School since 2000; Member of the Investment
<BR>
Committee of the National Trust for Historic
<BR>
Preservation since 2000.</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">0</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">0</FONT></TD>
</TR>
<TR>
<TD COLSPAN=11 ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TR>
<TD COLSPAN=11><FONT SIZE="1">&nbsp;</FONT></TD>
</TR>
<TR><TD> </TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Stephen B. Swensrud(1)(2)
<BR>
88 Broad Street, 2nd Floor
<BR>
Boston, Massachusetts 02110</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">68</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Chairman of Fernwood Advisors (investment adviser)
<BR>
since 1996; Principal of Fernwood Associates
<BR>
(financial consultant) since 1975; Chairman of RPP
<BR>
Corporation (manufacturing) since 1978; Director,
<BR>
International Mobile Communications, Inc. since
<BR>
1998.</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">0</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">0</FONT></TD>
</TR>
</TABLE>
<DIV ALIGN="left"><HR WIDTH="10%" SIZE="1" NOSHADE></DIV>

<TABLE BORDER="0" WIDTH="100%" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"><DIV ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">(1)&nbsp;</FONT></DIV>
</TD>
<TD WIDTH="96%" ALIGN="left" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Each of the nominees is a director, trustee or member of an advisory board of one or more additional investment companies for
which FAM or MLIM acts as investment adviser. See &#147;Compensation of Directors&#148; below.</FONT></DIV>
</TD>
</TR>
</TABLE>

<TABLE BORDER="0" WIDTH="100%" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"><DIV ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">(2)&nbsp;</FONT></DIV>
</TD>
<TD WIDTH="96%" ALIGN="left" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Member of the Audit Committee of the Board of Directors.</FONT></DIV>
</TD>
</TR>
</TABLE>

<TABLE BORDER="0" WIDTH="100%" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"><DIV ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;*&nbsp;</FONT></DIV>
</TD>
<TD WIDTH="96%" ALIGN="left" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times">Interested person, as defined in the Investment Company Act of 1940 (the &#147;Investment Company Act&#148;), of the
Fund.</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> <I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Audit Committee Report.&nbsp;&nbsp;&nbsp;&nbsp;</I>The Board of Directors of the Fund has a standing Audit Committee
(the &#147;Committee&#148;), which consists of the Directors who are not &#147;interested persons&#148; of the Fund within the meaning of the Investment Company Act and who are &#147;independent&#148; as defined in the listing standards of the New
York Stock Exchange. Currently, Messrs. Grills, Salomon, Seiden and Swensrud are members of the Committee. The principal responsibilities of the Committee are to: (i) recommend to the Board the selection, retention or termination of the Fund&#146;s
independent auditors; (ii) review with the independent auditors the scope, performance and anticipated cost of their audit; (iii) discuss with the independent auditors certain matters relating to the Fund&#146;s financial statements, including any
adjustment to such financial statements recommended by such independent auditors, or any other results of any audit; (iv) ensure that the independent auditors submit on a periodic basis a formal written statement as to their independence, discuss
with the independent auditors any relationships or services disclosed in the statement that may impact the objectivity and independence of the Fund&#146;s independent auditors and recommend that the Board take appropriate action in response to this
statement to satisfy itself of the independent auditors&#146; independence; and (v) consider the comments of the independent auditors and management&#146;s responses thereto with respect to the quality and adequacy of the Fund&#146;s accounting and
financial reporting policies and practices and internal controls. The Fund adopted an Audit Committee Charter at a meeting held on June 6, 2000. The Board of Directors revised and reapproved the Charter on April 11, 2001. A copy of the revised Audit
Committee Charter is attached to this Proxy Statement as Exhibit A. The Committee also has (a) received written disclosures and the letter required by Independence Standards Board Standard No. 1 from Ernst &amp; Young <SMALL>LLP</SMALL>
(&#147;E&amp;Y&#148;), the Fund&#146;s independent auditors, and (b) discussed certain matters required to be discussed by Statements on Auditing Standards No. 61 with E&amp;Y. The Committee has considered whether the provision of non-audit services
by the Fund&#146;s independent auditors is compatible with maintaining the independence of those auditors.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At its meeting held on November 13, 2001 the Committee reviewed and discussed the audit of the Fund&#146;s financial
statements with Fund management and the independent auditors. Had any material concerns arisen during the course of the audit and the preparation of the audited financial statements mailed to stockholders and included in the Fund&#146;s annual
report, the Committee would have been notified by Fund management or the independent auditors. The Committee received no such notifications. At the same meeting, the Audit Committee recommended to the Board of Directors that the Fund&#146;s audited
financial statements for the fiscal year ended September 30, 2001 be included in the Fund&#146;s annual report to stockholders.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In addition to the above, the Committee also reviews and nominates candidates to serve as non-interested Board members.
The Committee generally will not consider nominees recommended by stockholders of the Fund. The non-interested Board members have retained independent legal counsel to assist them in connection with these duties.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Committee and Board Meetings.&nbsp;&nbsp;&nbsp;&nbsp;</I>During the Fund&#146;s last fiscal year, each of the
Directors then in office attended at least 75% of the aggregate of the total number of meetings of the Board of Directors and, if a member, the total number of meetings of the Audit Committee held during the period for which he served.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Compliance with Section 16(a) of the Securities Exchange Act of 1934.&nbsp;&nbsp;&nbsp;&nbsp;</I>Section 16(a) of the
Securities Exchange Act of 1934, as amended (the &#147;Exchange Act&#148;), requires the Fund&#146;s officers and directors and persons who own more than ten percent of a registered class of the Fund&#146;s equity securities, to file reports of
ownership
and changes in ownership on Forms 3, 4 and 5 with the Securities and Exchange Commission (&#147;SEC&#148;) and the New York Stock Exchange. Officers, directors and greater than ten percent stockholders are required by SEC regulations to furnish the
Fund with copies of all Forms 3, 4 and 5 they file.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Based solely on the Fund&#146;s review of the copies of such forms, and amendments thereto, furnished to it during or
with respect to its most recent fiscal year, and written representations from certain reporting persons that they were not required to file Form 5 with respect to the most recent fiscal year, the Fund believes that all of its officers, directors,
greater than ten percent beneficial owners and other persons subject to Section 16 of the Exchange Act due to the requirements of Section 30 of the Investment Company Act (i.e., any advisory board member, investment adviser or affiliated person of
the Fund&#146;s investment adviser), have complied with all filing requirements applicable to them with respect to transactions during the Fund&#146;s most recent fiscal year.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interested Person.&nbsp;&nbsp;&nbsp;&nbsp;</I>The Fund considers Mr. Glenn to be an &#147;interested person&#148; of
the Fund within the meaning of Section 2(a)(19) of the Investment Company Act due to the positions he holds with FAM and its affiliates and/or due to his ownership of securities issued by Merrill Lynch &amp; Co. (&#147;ML &amp; Co.&#148;). Mr. Glenn
is the President of the Fund.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Compensation of Directors.&nbsp;&nbsp;&nbsp;&nbsp;</I>FAM, the Fund&#146;s investment adviser, pays all compensation
of all officers of the Fund and all Directors of the Fund who are affiliated with ML &amp; Co. or its subsidiaries. The Fund pays each Director not affiliated with FAM (each a &#147;non-interested Director&#148;) a fee of $2,000 per year plus $500
per meeting attended, together with such Director&#146;s actual out-of-pocket expenses relating to attendance at meetings. The Fund also pays each member of its Audit Committee, which consists of all the non-interested Directors, a fee of $2,000 per
year plus $500 per meeting attended, together with such Director&#146;s out-of-pocket expenses relating to attendance at meetings. These fees and expenses aggregated $33,044 for the fiscal year ended September 30, 2001.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth for the fiscal year ended September 30, 2001 compensation paid by the Fund to the
non-interested Directors and, for the calendar year ended December 31, 2000, the aggregate compensation paid by all investment companies advised by FAM and its affiliate, MLIM (&#147;FAM/ MLIM-Advised Funds&#148;), to the non-interested
Directors.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>

<TABLE ALIGN="center" WIDTH="613" CELLSPACING=0 CELLPADDING=0>
<TR>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Name of Director</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Compensation
<BR>
from Fund</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Pension or
<BR>
Retirement Benefits
<BR>
Accrued as Part of
<BR>
Fund Expenses</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Aggregate
<BR>
Compensation from
<BR>
Fund, Other
<BR>
FAM/MLIM-Advised
<BR>
Funds Paid to Directors</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
</TR>
<TR>
<TD VALIGN="bottom" NOWRAP ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Joe Grills(1)</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$6,500</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">None</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$224,500</FONT></TD>
</TR>
<TR>
<TD VALIGN="bottom" NOWRAP ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Walter Mintz(1)(2)</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$6,500</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">None</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$184,000</FONT></TD>
</TR>
<TR>
<TD VALIGN="bottom" NOWRAP ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Robert S. Salomon, Jr.(1)</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$6,500</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">None</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$184,000</FONT></TD>
</TR>
<TR>
<TD VALIGN="bottom" NOWRAP ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Melvin R. Seiden(1)</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$6,500</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">None</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$184,000</FONT></TD>
</TR>
<TR>
<TD VALIGN="bottom" NOWRAP ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Stephen B. Swensrud(1)</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$6,500</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">None</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$280,233</FONT></TD>
</TR>
</TABLE>
<DIV ALIGN="left"><HR WIDTH="10%" SIZE="1" NOSHADE></DIV>

<TABLE BORDER="0" WIDTH="100%" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"><DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(1)</FONT></DIV>
</TD>
<TD WIDTH="96%" ALIGN="left" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">The Directors serve on the boards of other FAM/MLIM-Advised Funds as follows: Mr. Grills (20 registered investment companies
consisting of 49 portfolios); Mr. Mintz (16 registered investment companies consisting of 36 portfolios); Mr. Salomon (16 registered investment companies consisting of 36 portfolios); Mr. Seiden (16 registered investment companies consisting of 36
portfolios); Mr. Swensrud (42 registered investment companies consisting of 87 portfolios).</FONT></DIV>
</TD>
</TR>
</TABLE>

<TABLE BORDER="0" WIDTH="100%" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"><DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">(2)</FONT></DIV>
</TD>
<TD WIDTH="96%" ALIGN="left" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Effective September 24, 2001, Mr. Mintz retired from the Boards of the FAM/MLIM-Advised Funds for which he served as a
Director.</FONT></DIV>
</TD>
</TR>
</TABLE>
<FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> <I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Officers of the Fund.&nbsp;&nbsp;&nbsp;&nbsp;</I>The Board of Directors has elected seven officers of the Fund. The following sets
forth information concerning each of these officers:</FONT><DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="center">
<TABLE ALIGN="center" WIDTH="80%" CELLSPACING=0 CELLPADDING=0 BORDER="0">
<TR>
<TH VALIGN="bottom" NOWRAP ALIGN="center" COLSPAN="2"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Name and Principal Occupation</B></FONT><FONT SIZE="1"> <HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE> </FONT></TH>
<TH WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center" WIDTH="19"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Age</B></FONT><FONT SIZE="1"> <HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE> </FONT></TH>
<TH WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center" WIDTH="83"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Office</B></FONT><FONT SIZE="1"> <HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE> </FONT></TH>
<TH WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center" WIDTH="39"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Officer
<BR>
Since</B></FONT><FONT SIZE="1"> <HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE> </FONT></TH>
</TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" COLSPAN="2"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Terry K. Glenn</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">61</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">President</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
</TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="27">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="403"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> Chairman (Americas Region) of MLIM since 2001; Executive Vice
<BR>
President of FAM and MLIM since 1983; Executive Vice President and
<BR>
Director of Princeton Services since 1993; President of Merrill Lynch
<BR>
Mutual Funds since 1999; President of FAMD since 1986 and Director
<BR>
thereof since 1991; President of Princeton Administrators, L.P. since
<BR>
1988; Director of Financial Data Services, Inc. since 1985.</FONT></TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39">&nbsp;</TD>
</TR>
<TR>
<TD COLSPAN=8 ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TR>
<TD COLSPAN=8><FONT SIZE="1">&nbsp;</FONT></TD>
</TR>
<TR><TD> </TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" COLSPAN="2"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Vincent R. Giordano</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">57</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Senior Vice
<BR>
President</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
</TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="27">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="403"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> Managing Director of MLIM since 2000; Senior Vice President of MLIM
<BR>
from 1984 to 2000; Portfolio Manager of FAM and MLIM since 1977;
<BR>
Senior Vice President of Princeton Services since 1993.</FONT></TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39">&nbsp;</TD>
</TR>
<TR>
<TD COLSPAN=8 ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TR>
<TD COLSPAN=8><FONT SIZE="1">&nbsp;</FONT></TD>
</TR>
<TR><TD> </TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" COLSPAN="2"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Kenneth A. Jacob</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">50</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Vice President</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
</TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="27">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="403"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> Managing Director of MLIM since 2000; First Vice President of MLIM
<BR>
from 1997 to 2000; Vice President of FAM and MLIM from 1984 to
<BR>
1997; Vice President of FAM since 1984.</FONT></TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39">&nbsp;</TD>
</TR>
<TR>
<TD COLSPAN=8 ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TR>
<TD COLSPAN=8><FONT SIZE="1">&nbsp;</FONT></TD>
</TR>
<TR><TD> </TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="27">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="403"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">William R. Bock
<BR>
Vice President of MLIM since 1989.</FONT></TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">65</FONT></TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Vice President</FONT></TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
</TR>
<TR>
<TD COLSPAN=8 ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TR>
<TD COLSPAN=8><FONT SIZE="1">&nbsp;</FONT></TD>
</TR>
<TR><TD> </TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" COLSPAN="2"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Robert A. DiMella</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">35</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Vice President</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
</TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="27">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="403"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> Vice President of MLIM since 1997; Assistant Vice President of MLIM
<BR>
from 1995 to 1997; Assistant Portfolio Manager of MLIM from 1993 to
<BR>
1995; Assistant Portfolio Manager with Prudential Investment Advisers
<BR>
from 1991 to 1993.</FONT></TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39">&nbsp;</TD>
</TR>
<TR>
<TD COLSPAN=8 ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TR>
<TD COLSPAN=8><FONT SIZE="1">&nbsp;</FONT></TD>
</TR>
<TR><TD> </TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" COLSPAN="2"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Donald C. Burke</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">41</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Vice President
<BR>
and Treasurer</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
</TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="27">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="403"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> First Vice President of FAM and MLIM since 1997 and Treasurer thereof
<BR>
since 1999; Senior Vice President and Treasurer of Princeton Services
<BR>
since 1999; Vice President of FAMD since 1999; Vice President of
<BR>
MLIM and FAM from 1990 to 1997; Director of Taxation of MLIM
<BR>
since 1990.</FONT></TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39">&nbsp;</TD>
</TR>
<TR>
<TD COLSPAN=8 ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TR>
<TD COLSPAN=8><FONT SIZE="1">&nbsp;</FONT></TD>
</TR>
<TR><TD> </TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" COLSPAN="2"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Bradley J. Lucido</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">35</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Secretary</FONT></TD>
<TD WIDTH="8">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">1999</FONT></TD>
</TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="27">&nbsp;</TD>
<TD VALIGN="top" NOWRAP ALIGN="left" WIDTH="403"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> Vice President of MLIM since 1999; attorney with MLIM since 1995;
<BR>
attorney in private practice from 1991 to 1995.</FONT></TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="19">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="center" WIDTH="83">&nbsp;</TD>
<TD WIDTH="8"><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top" NOWRAP ALIGN="right" WIDTH="39">&nbsp;</TD>
</TR>
</TABLE>
</DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><I>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock Ownership.&nbsp;&nbsp;&nbsp;&nbsp;</I>At the Record Date, the Directors and officers of the Fund as a group (11
persons) owned an aggregate of less than 1% of the Common Stock of the Fund outstanding at such date and owned none of the AMPS outstanding at such date. At such date, Mr. Glenn, President and a Director and officer of the Fund, and the other
officers of the Fund owned an aggregate of less than 1% of the outstanding shares of common stock of ML &amp; Co.</FONT></DIV>
<P>  <DIV><FONT SIZE="6">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> <B>ADDITIONAL INFORMATION</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The expenses of preparation, printing and mailing of the enclosed form of proxy and accompanying Notice and Proxy
Statement will be borne by the Fund. The Fund will reimburse banks, brokers and others for their reasonable expenses in forwarding proxy solicitation material to the beneficial owners of the shares of the Fund.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In order to obtain the necessary quorum at the Meeting (<I>i.e.</I>, one-third of the shares of each class of the
Fund&#146;s securities entitled to vote at the Meeting, present in person or by proxy), supplementary solicitation may be made by mail, telephone, telegraph or personal interview by officers of the Fund. The Fund has retained Georgeson Shareholder,
17 State Street, New York, New York 10004, 1-800-645-4519, to assist in the solicitation of proxies at a cost to the Fund of approximately $3,500, plus out-of-pocket expenses, which are estimated to be $500.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All shares represented by properly executed proxies, unless such proxies have previously been revoked, will be voted at
the Meeting in accordance with the directions on the proxies; if no direction is indicated, the shares will be voted &#147;FOR&#148; the Director nominees.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;With respect to Item 1. &#147;Election of Directors,&#148; holders of AMPS, voting separately as a class, are entitled
to elect the two AMPS Directors designated above, and holders of Common Stock and AMPS, voting together as a single class, are entitled to elect the remaining Directors. Assuming a quorum is present, (i) election of the Directors to be elected by
the holders of AMPS, voting separately as a class, will require a plurality of the votes cast by the holders of AMPS, represented at the Meeting and entitled to vote; and (ii) election of the remaining Directors will require a plurality of the votes
cast by the holders of Common Stock and AMPS represented at the Meeting and entitled to vote, voting together as a single class. A &#147;plurality of the votes&#148; means the candidate must receive more votes than any other candidate for the same
position, but not necessarily a majority of votes cast.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Broker-dealer firms, including Merrill Lynch, Pierce, Fenner &amp; Smith Incorporated (&#147;MLPF&amp;S&#148;), holding
Fund shares in &#147;street name&#148; for the benefit of their customers and clients, will request the instructions of such customers and clients on how to vote their shares on Item 1 before the Meeting. The Fund understands that, under the rules
of the New York Stock Exchange, such broker-dealer firms may, without instructions from their customers and clients, grant authority to the proxies designated to vote on the election of Directors if no instructions have been received prior to the
date specified in the broker-dealer firm&#146;s request for voting instructions. The Fund will include shares held of record by broker-dealers as to which such authority has been granted in its tabulation of the total number of votes present for
purposes of determining whether the necessary quorum of stockholders exists. Proxies that are returned but that are marked &#147;abstain&#148; or on which a broker-dealer has declined to vote on any proposal (&#147;broker non-votes&#148;) will be
counted as present for the purposes of a quorum. MLPF&amp;S has advised the Fund that if it votes shares held in its name for which no instructions have been received, except as limited by agreement or applicable law, it will do so in the same
proportion as the votes received from beneficial owners of those shares for which instructions have been received, whether or not held in nominee name. Abstentions and broker non-votes will not be counted as votes cast. Abstentions and broker
non-votes, therefore, will not have an effect on the vote.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Management knows of no other matters to be presented at the special meeting. However, if other matters are presented
for a vote at the meeting or any adjournments thereof, the proxy holders will vote the shares represented by properly executed proxies according to their judgment on those matters.</FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>Independent Auditors&#146; Fees</B></FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth the aggregate fees paid to the independent auditors for the Fund&#146;s most recent
fiscal year for professional services rendered for: (i) the audit of the Fund&#146;s annual financial statements and the review of the financial statements included in the Fund&#146;s report to stockholders; (ii) financial information systems design
and implementation services provided to the Fund, its investment adviser and entities controlling, controlled by or under common control with the investment adviser that provide services to the Fund; and (iii) all other non-audit services provided
to the Fund, its investment adviser, and entities controlling, controlled by or under common control with the investment adviser that provide services to the Fund. The Committee has determined that the provision of information technology services
under clause (ii) and the provision of non-audit services under clause (iii) are compatible with maintaining the independence of the independent auditors of the Fund.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>

<TABLE ALIGN="center" WIDTH="614" CELLSPACING=0 CELLPADDING=0>
<TR>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Fund</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Audit Fees
<BR>
Charged
<BR>
to the Fund</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Financial Information
<BR>
Systems Design and
<BR>
Implementation Fees</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Other
<BR>
Fees*</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
<TH><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TH>
<TH VALIGN="bottom" NOWRAP ALIGN="center"><FONT SIZE="1" COLOR="#000000" FACE="'Times New Roman', Times"><B>Fiscal Year End</B></FONT><FONT SIZE="1"><HR ALIGN="center" WIDTH="100%" SIZE="1" NOSHADE></FONT></TH>
</TR>
<TR>
<TD VALIGN="bottom" NOWRAP ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">MuniHoldings Insured Fund II, Inc.</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$36,330</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&#151;&nbsp;&nbsp;</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">$23,520</FONT></TD>
<TD><FONT SIZE="1">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom" NOWRAP ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">September 30, 2001</FONT></TD>
</TR>
</TABLE>
<DIV ALIGN="left"><HR WIDTH="10%" SIZE="1" NOSHADE></DIV>

<TABLE BORDER="0" WIDTH="100%" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="2%" ALIGN="left" VALIGN="top"><DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">*&nbsp;</FONT></DIV>
</TD>
<TD WIDTH="98%" ALIGN="left" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Includes fees billed for non-audit services rendered to the Fund and other Funds controlled by FAM/MLIM during the year ended
December 31, 2000.</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>Address of Investment Adviser</B></FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The principal office of FAM is located at 800 Scudders Mill Road, Plainsboro, New Jersey 08536.</FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>Annual Report Delivery</B></FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Fund will furnish, without charge, a copy of its most recent annual report and semi-annual report to any
stockholder upon request. </B>Such requests should be directed to MuniHoldings Insured Fund II, Inc., P.O. Box 9011, Princeton, New Jersey 08543-9011, Attention: Bradley J. Lucido, or to 1-800-637-3863.</FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>Stockholder Proposals</B></FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If a stockholder intends to present a proposal at the 2002 Annual Meeting of Stockholders of the Fund, which is
anticipated to be held in December 2002, and desires to have the proposal included in the Fund&#146;s proxy statement and form of proxy for that meeting, the stockholder must deliver the proposal to the offices of the Fund by July 16, 2002. The
persons named as proxies in the proxy materials for the 2002 Annual Meeting of Stockholders may exercise discretionary authority with respect to any stockholder proposal presented at such meeting if written notice of such proposal has not been
received by the Fund by September 27, 2002. Written
proposals and notices should be sent to the Secretary of the Fund (addressed to 800 Scudders Mill Road, Plainsboro, New Jersey 08536).</FONT></DIV>
<DIV><FONT SIZE="3">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="52%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">By Order of the Board of Directors</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="52%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">B<SMALL>RADLEY </SMALL>
J. L<SMALL>UCIDO</SMALL>
</FONT></DIV>
</TD>
</TR>
</TABLE>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="52%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><I>Secretary</I></FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Dated: November 13, 2001</FONT></DIV>
<DIV ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> <B>Exhibit A</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>CHARTER OF THE AUDIT COMMITTEE</B></FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>OF THE BOARD OF DIRECTORS/TRUSTEES</B></FONT></DIV>
<DIV ALIGN="center"><FONT SIZE="3" COLOR="#000000" FACE="'Times New Roman', Times"><B>FOR EXCHANGE LISTED FUNDS</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although each investment company audit committee also serves as a nominating committee, the following charter pertains
only to each audit and nominating committee&#146;s duties as an audit committee. The Board of Directors of each investment company listed on Appendix A hereto, has adopted the following audit committee charter:</FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>I.&nbsp;&nbsp;&nbsp;&nbsp;Composition of the Audit Committee</B></FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Audit Committee shall be composed of at least three Directors:</FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;each of whom shall not be an &#147;interested person&#148; of
the Fund, as defined in Section 2(a)(19) of the Investment Company Act of 1940, as amended;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;each of whom shall not have any relationship to the Fund that
may interfere with the exercise of their independence from Fund management and the Fund;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;each of whom shall otherwise satisfy the applicable
independence requirements for any stock exchange or market quotation system on which Fund shares are listed or quoted;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;each of whom shall be financially literate, as such
qualification is interpreted by the Board of Directors in its business judgment, or shall become financially literate within a reasonable period of time after his or her appointment to the Audit Committee; and</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;at least one of whom shall have accounting or related
financial management expertise as the Board of Directors interprets such qualification in its business judgment.</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>II.&nbsp;&nbsp;&nbsp;&nbsp;Purposes of the Audit Committee</B></FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The purposes of the Audit Committee are to assist the Board of Directors:</FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;in its oversight of the Fund&#146;s accounting and financial
reporting policies and practices, the Fund&#146;s internal audit controls and procedures and, as appropriate, the internal audit controls and procedures of certain of the Fund&#146;s service providers;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;in its oversight of the Fund&#146;s financial statements and
the independent audit thereof; and</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;in acting as a liaison between the Fund&#146;s independent
accountants and the Board of Directors.</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The function of the Audit Committee is oversight. Fund management is responsible for maintaining appropriate systems for
accounting. The independent accountants of the Fund are responsible for conducting a proper audit of the Fund&#146;s financial statements.</FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>III.&nbsp;&nbsp;&nbsp;&nbsp;Responsibilities and Duties of the Audit Committee</B></FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The policies and procedures of the Audit Committee shall remain flexible to facilitate its ability to react to changing
conditions and to generally discharge its functions. The following listed responsibilities describe areas of attention in broad terms.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;To carry out its purposes, the Audit Committee shall have the following responsibilities and duties:</FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;to recommend the selection, retention or termination of the
Fund&#146;s independent accountants based on an evaluation of their independence and the nature and performance of audit services and other services;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;to ensure that the independent accountants for the Fund submit
on a periodic basis to the Audit Committee a formal written statement delineating all relationships between such independent accountants and the Fund, consistent with Independence Standards Board Standard No. 1, and actively engage in a dialogue
with the independent accountants for the Fund with respect to any disclosed relationships or services that may impact the objectivity and independence of such independent accountants and, if deemed appropriate by the Audit Committee, to recommend
that the Board of Directors take appropriate action in response to the report of such independent accountants to satisfy itself of the independence of such independent accountants;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;to receive specific representations from the independent
accountants with respect to their independence and to consider whether the provision of any disclosed non-audit services by the independent accountants is compatible with maintaining the independence of those accountants;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;to review the fees charged by independent accountants for
audit and other services;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;to review with the independent accountants arrangements for
annual audits and special audits and the scope thereof;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;to discuss with the independent accountants those matters
required by SAS No. 61 and SAS No. 90 relating to the Fund&#146;s financial statements, including, without limitation, any adjustment to such financial statements recommended by such independent accountants, or any other results of any
audit;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)&nbsp;&nbsp;to consider with the independent accountants their comments
with respect to the quality and adequacy of the Fund&#146;s accounting and financial reporting policies, practices and internal controls and management&#146;s responses thereto, including, without limitation, the effect on the Fund of any
recommendation of changes in accounting principles or practices by management or the independent accountants;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)&nbsp;&nbsp;to report to the Board of Directors regularly with respect to
the Audit Committee&#146;s activities and to make any recommendations it believes necessary or appropriate with respect to the Fund&#146;s accounting and financial reporting policies, practices and the Fund&#146;s internal controls;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;to review and reassess the adequacy of this Charter on an
annual basis and recommend any changes to the Board of Directors;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)&nbsp;&nbsp;to review legal and regulatory matters presented by counsel
and the independent accountants for the Fund that may have a material impact on the Fund&#146;s financial statements;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)&nbsp;&nbsp;to cause to be prepared and to review and submit any report,
including any recommendation of the Audit Committee, required to be included in the Fund&#146;s annual proxy statement by the rules of the Securities and Exchange Commission;</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)&nbsp;&nbsp;to assist the Fund, if necessary, in preparing any written
affirmation or written certification required to be filed with any stock exchange on which Fund shares are listed; and</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>

<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR>
<TD WIDTH="4%" ALIGN="left" VALIGN="top"></TD>
<TD ALIGN="left" WIDTH="96%" VALIGN="top"> <DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m)&nbsp;&nbsp;to perform such other functions consistent with this Charter,
the Fund&#146;s By-laws and governing law, as the Audit Committee or the Board of Directors deems necessary or appropriate.</FONT></DIV>
</TD>
</TR>
</TABLE>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In fulfilling their responsibilities hereunder, it is recognized that members of the Audit Committee are not full-time
employees of the Fund and are not, and do not represent themselves to be, accountants or auditors by profession or experts in the field of accounting or auditing. As such, it is not the duty or responsibility of the Audit Committee or its members to
conduct &#147;field work&#148; 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 inside and outside the Fund from
which the Audit Committee receives information and (ii) the accuracy of the financial and other information provided to the Audit Committee by such persons or organizations absent actual knowledge to the contrary (which actual knowledge shall be
promptly reported to the Board of Directors).</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The independent accountants for the Fund are ultimately accountable to the Board of Directors and the Audit Committee.
The Board of Directors and the Audit Committee have the ultimate authority and responsibility to select, evaluate and, where appropriate, replace the independent accountants for the Fund (or to nominate the independent accountants to be proposed for
shareholder approval in the proxy statement).</FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>IV.&nbsp;&nbsp;&nbsp;&nbsp;Meetings</B></FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Audit Committee shall meet at least once annually with the independent accountants (outside the presence of Fund
management) and at least once annually with the representatives of Fund management responsible for the financial and accounting operations of the Fund. The Audit Committee shall hold special meetings at such times as the Audit Committee believes
appropriate. Members of the Audit Committee may participate in a meeting of the Audit Committee by means of conference call or similar communications equipment by means of which all persons participating in such meeting can hear each
other.</FONT></DIV>
<DIV><FONT SIZE="5">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"><B>V.&nbsp;&nbsp;&nbsp;&nbsp;Outside Resources and Assistance from Fund Management</B></FONT></DIV>
<DIV><FONT SIZE="1">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The appropriate officers of the Fund shall provide or arrange to provide such information, data and services as the
Audit Committee may request. The Audit Committee shall have the power and authority to take all action it believes necessary or appropriate to discharge its responsibilities, including the authority to retain at the expense of the Fund their own
counsel and other experts and consultants whose expertise would be considered helpful to the Audit Committee.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Dated June 6, 2000</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">Revised April 11, 2001</FONT></DIV>
<DIV ALIGN="right"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times"> <B>APPENDIX A</B></FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">APEX MUNICIPAL FUND, INC.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">CORPORATE HIGH YIELD FUND, INC.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">CORPORATE HIGH YIELD FUND II, INC.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">CORPORATE HIGH YIELD FUND III, INC.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">MUNIHOLDINGS INSURED FUND II, INC.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">MUNIINSURED FUND, INC.</FONT></DIV>
<DIV><FONT SIZE="2">&nbsp;</FONT></DIV>
<DIV ALIGN="left"><FONT SIZE="2" COLOR="#000000" FACE="'Times New Roman', Times">MUNIYIELD INSURED FUND, INC.</FONT></DIV>

<P>
<P ALIGN="right"><B>COMMON STOCK</B>
<P ALIGN="center"><B>MUNIHOLDINGS INSURED FUND II, INC.
<BR>
P.O. Box 9011
<BR>
Princeton, New Jersey 08543-9011</B>
<P ALIGN="center"><B>PROXY</B>
<P ALIGN="center"><B>This proxy is solicited on behalf of the Board of Directors</B>
<P>The undersigned hereby appoints Donald C. Burke, Terry K. Glenn and Bradley J. Lucido as proxies, each with the power to appoint his substitute, and hereby authorizes each of them to represent and to vote, as designated on the reverse hereof, all
the Common Stock of MuniHoldings Insured Fund II, Inc. (the &#147;Fund&#148;) held of record by the undersigned on October&nbsp;25, 2001 at the annual meeting of stockholders of the Fund to be held on December&nbsp;12, 2001 or any adjournment
thereof.
<P> <DIV ALIGN="center"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This proxy when properly executed will be voted in the manner directed herein by the undersigned stockholder. If no direction is made, this proxy will be voted FOR Proposal 1.</B></DIV>
<P>By signing and dating the reverse side of this card, you authorize the proxies to vote Proposal 1 as marked, or if not marked, to vote &#147;FOR&#148; Proposal 1, and to use their discretion to vote for any other matter as may properly come
before the meeting or any adjournment thereof. If you do not intend to personally attend the meeting, please complete and return this card at once in the enclosed envelope.
<P ALIGN="right">(Continued and to be signed on the reverse side)
<P ALIGN="left">&nbsp;
<P><HR NOSHADE>
<P>
<P>Please mark boxes [&#149;] or [X] in blue or black ink. <CENTER>
<TABLE CELLSPACING="0" BORDER="0" CELLPADDING="0" WIDTH="100%" ALIGN="center">
<TR VALIGN="bottom">
<TD WIDTH="1%">&nbsp;</TD>
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="23%">&nbsp;</TD>
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="33%">&nbsp;</TD>
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="34%">&nbsp;</TD>
</TR>
<TR VALIGN="bottom">
<TD VALIGN="top"><FONT SIZE="2">1.</FONT></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2"> ELECTION OF DIRECTORS </FONT></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2"><B>FOR </B>all nominees listed below </FONT></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2"><B>WITHHOLD AUTHORITY</B></FONT></TD>
</TR>
<TR>
<TD><TR>
<TD><TR>
<TD><TR>
<TD> <TR VALIGN="bottom">
<TD VALIGN="top"></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2"> </FONT></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2">(except as marked to the contrary below)&nbsp;&nbsp;[&nbsp;&nbsp;] </FONT></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2">to vote for all nominees listed below&nbsp;&nbsp;[&nbsp;&nbsp;]</FONT></TD>
</TR>
</TABLE>
</CENTER>
<CENTER>
<TABLE CELLSPACING="0" BORDER="0" CELLPADDING="0" WIDTH="100%" ALIGN="center">
<TR VALIGN="bottom">
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="96%">&nbsp;</TD>
</TR>
<TR VALIGN="bottom">
<TD WIDTH="4%">&nbsp;</TD>
<TD VALIGN="top" WIDTH="96%"><FONT SIZE="2"><B><I>(INSTRUCTION: To withhold authority to vote for any individual nominee, strike a line through the nominee&#146;s name in the list below.)</I></B>
<BR>
<B>Terry K. Glenn, Joe Grills and Stephen B. Swensrud </B></FONT></TD>
</TR>
</TABLE>
</CENTER>
<CENTER>
<TABLE CELLSPACING="0" BORDER="0" CELLPADDING="0" WIDTH="100%" ALIGN="center">
</TABLE>
</CENTER>
<CENTER>
<TABLE CELLSPACING="0" BORDER="0" CELLPADDING="0" WIDTH="100%" ALIGN="center">
<TR VALIGN="bottom">
<TD VALIGN="top">&nbsp;</TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top">&nbsp;</TD>
</TR>
<TR VALIGN="bottom">
<TD VALIGN="top"><FONT SIZE="2">2.</FONT></TD>
<TD> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2"> In the discretion of such proxies, upon such other business as may properly come before the meeting or any adjournment thereof.</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P>
<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="top">
<TD WIDTH="50%">&nbsp;</TD>
<TD WIDTH="50%">&nbsp;</TD>
</TR>
<TR VALIGN="top">
<TD>&nbsp;</TD>
<TD><FONT SIZE="2">Please sign exactly as name appears hereon. When stock is held by joint tenants, both should sign. When signing as attorney or as executor, administrator, trustee or guardian, please give full title as such. If 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.</FONT></TD>
</TR>
<TR VALIGN="top">
<TD>&nbsp;</TD>
</TR>
<TR VALIGN="top">
<TD>&nbsp;</TD>
<TD><FONT SIZE="2">Dated: ________________________________, 2001</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="top">
<TD WIDTH="50%">&nbsp;</TD>
<TD WIDTH="50%"><FONT SIZE="2">X ___________________________________
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Signature</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="top">
<TD WIDTH="50%">&nbsp;</TD>
<TD WIDTH="50%"><FONT SIZE="2">X ___________________________________
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Signature, if held jointly</FONT></TD>
</TR>
</TABLE>
<P ALIGN="center"><B>Sign, Date and Return the Proxy Card Promptly Using the Enclosed Envelope.</B>
<P ALIGN="left">&nbsp;
<P><HR NOSHADE>
<P>
<P ALIGN="right"><B>AUCTION MARKET
<BR>
PREFERRED STOCK</B>
<P ALIGN="center"><B>MUNIHOLDINGS INSURED FUND II, INC.
<BR>
P.O. Box 9011
<BR>
Princeton, New Jersey 08543-9011</B>
<P ALIGN="center"><B>PROXY</B>
<P ALIGN="center"><B>This proxy is solicited on behalf of the Board of Directors</B>
<P>The undersigned hereby appoints Donald C. Burke, Terry K. Glenn and Bradley J. Lucido as proxies, each with the power to appoint his substitute, and hereby authorizes each of them to represent and to vote, as designated on the reverse hereof, all
the Auction Market Preferred Stock of MuniHoldings Insured Fund II, Inc. (the &#147;Fund&#148;) held of record by the undersigned on October&nbsp;25, 2001 at the annual meeting of stockholders of the Fund to be held on December&nbsp;12, 2001 or any
adjournment thereof.
<P><DIV ALIGN="center"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This proxy when properly executed will be voted in the manner directed herein by the undersigned stockholder. If no direction is made, this proxy will be voted FOR Proposal 1.</B></DIV>
<P>By signing and dating the reverse side of this card, you authorize the proxies to vote Proposal 1 as marked, or if not marked, to vote &#147;FOR&#148; Proposal 1 and to use their discretion to vote for any other matter as may properly come before
the meeting or any adjournment thereof. If you do not intend to personally attend the meeting, please complete and return this card at once in the enclosed envelope.
<P ALIGN="right">(Continued and to be signed on the reverse side)
<P ALIGN="left">&nbsp;
<P><HR NOSHADE>
<P> Please mark boxes &nbsp;[&#149;] or [X] in blue or black ink. <CENTER>
<TABLE CELLSPACING="0" BORDER="0" CELLPADDING="0" WIDTH="100%" ALIGN="center">
<TR VALIGN="bottom">
<TD WIDTH="1%">&nbsp;</TD>
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="23%">&nbsp;</TD>
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="33%">&nbsp;</TD>
<TD WIDTH="3%">&nbsp;</TD>
<TD WIDTH="34%">&nbsp;</TD>
</TR>
<TR VALIGN="bottom">
<TD VALIGN="top"><FONT SIZE="2">1.</FONT></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2"> ELECTION OF DIRECTORS </FONT></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2"><B>FOR </B>all nominees listed below </FONT></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2"><B>WITHHOLD AUTHORITY</B></FONT></TD>
</TR>
<TR>
<TD><TR>
<TD><TR>
<TD><TR>
<TD> <TR VALIGN="bottom">
<TD VALIGN="top"></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2"> </FONT></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2">(except as marked to the contrary below)&nbsp;&nbsp;[&nbsp;&nbsp;] </FONT></TD>
<TD></TD>
<TD ALIGN="left" VALIGN="top"><FONT SIZE="2">To vote for all nominees listed below&nbsp;&nbsp;[&nbsp;&nbsp;]</FONT></TD>
</TR>
</TABLE>
</CENTER>
<CENTER>
<TABLE CELLSPACING="0" BORDER="0" CELLPADDING="0" WIDTH="100%" ALIGN="center">
<TR VALIGN="bottom">
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="96%">&nbsp;</TD>
</TR>
<TR VALIGN="bottom">
<TD>&nbsp;</TD>
<TD VALIGN="top"><FONT SIZE="2"><B><I>(INSTRUCTION: To withhold authority to vote for any individual nominee, strike a line through the nominee&#146;s name in the list below.)</I></B>
<BR>
<B>Terry K. Glenn, Joe Grills, Robert S. Salomon, Jr., Melvin R. Seiden and Stephen B. Swensrud</B></FONT></TD>
</TR>
</TABLE>
</CENTER>
<CENTER>
<TABLE CELLSPACING="0" BORDER="0" CELLPADDING="0" WIDTH="55%" ALIGN="center">
</TABLE>
</CENTER>
<CENTER>
<TABLE CELLSPACING="0" BORDER="0" CELLPADDING="0" WIDTH="100%" ALIGN="center">
<TR VALIGN="bottom">
<TD VALIGN="top" WIDTH="1%">&nbsp;</TD>
<TD WIDTH="3%"></TD>
<TD ALIGN="left" VALIGN="top" WIDTH="96%">&nbsp;</TD>
</TR>
<TR VALIGN="bottom">
<TD VALIGN="top" WIDTH="1%"><FONT SIZE="2">2.</FONT></TD>
<TD WIDTH="3%"></TD>
<TD ALIGN="left" VALIGN="top" WIDTH="96%"><FONT SIZE="2"> In the discretion of such proxies, upon such other business as may properly come before the meeting or any adjournment thereof.</FONT></TD>
</TR>
</TABLE>
</CENTER>
<CENTER>
<TABLE CELLSPACING="0" BORDER="0" CELLPADDING="0" WIDTH="100%" ALIGN="center">
<TR VALIGN="bottom">
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="96%">&nbsp;</TD>
</TR>
<TR VALIGN="bottom">
<TD>&nbsp;</TD>
<TD VALIGN="top"><FONT SIZE="2">If the undersigned is a broker-dealer, it hereby instructs the proxies, pursuant to Rule 452 of the New York Stock Exchange, to vote any uninstructed Auction Market Preferred Stock in the same proportion as votes cast
by holders of Auction Market Preferred Stock who have responded to this proxy solicitation.</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P>
<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="top">
<TD WIDTH="50%">&nbsp;</TD>
<TD WIDTH="50%">&nbsp;</TD>
</TR>
<TR VALIGN="top">
<TD WIDTH="50%">&nbsp;</TD>
<TD WIDTH="50%"><FONT SIZE="2">Please sign exactly as name appears hereon. When stock is held by joint tenants, both should sign. When signing as attorney or as executor, administrator, trustee or guardian, please give full title as such. If 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.</FONT></TD>
</TR>
<TR VALIGN="top">
<TD WIDTH="50%">&nbsp;</TD>
</TR>
<TR VALIGN="top">
<TD WIDTH="50%">&nbsp;</TD>
<TD WIDTH="50%"><FONT SIZE="2">Dated: ________________________________, 2001</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="top">
<TD WIDTH="50%">&nbsp;</TD>
<TD WIDTH="50%"><FONT SIZE="2">X ___________________________________
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Signature</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE WIDTH="100%" BORDER="0" CELLPADDING="0" CELLSPACING="0">
<TR VALIGN="top">
<TD WIDTH="50%">&nbsp;</TD>
<TD WIDTH="50%"><FONT SIZE="2">X ___________________________________
<BR>
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Signature, if held jointly</FONT></TD>
</TR>
</TABLE>
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