Investment Grade Municipal Income Fund Inc. Issues Letter to Shareholders Regarding Consideration of Resolution from 2009 Annual Stockholders’ Meeting

Investment Grade Municipal Income Fund Inc. (NYSE: PPM) (the "Fund”) today announced that its Board of Directors is sending the attached letter to the Fund’s shareholders regarding consideration of a resolution from the Fund’s 2009 Annual Stockholders’ Meeting:

At the annual meeting of stockholders of Investment Grade Municipal Income Fund Inc. (the "Fund”) held on January 15, 2009, a stockholder proposal to recommend that the Board of Directors of the Fund not retain UBS Global Asset Management (Americas) Inc. ("UBS Global AM”) or certain affiliated entities as investment advisers to the Fund was approved by a narrow margin. This stockholder proposal is non-binding on the Fund’s board. Nonetheless, the Board has considered the recommendation set forth in the stockholder proposal (the "Recommendation”) but has determined not to implement it, for the reasons discussed below.

The Board met with its independent legal counsel to discuss the Recommendation. The Board also reviewed various memoranda and data provided to the Board. The Board also met with UBS Global AM to discuss the Recommendation. The Board considered, among others, the following factors:

UBS Global AM Was Not Involved in the Regulatory Actions. The stockholder proposal was premised on certain state and federal regulatory actions and a U.S. Department of Justice investigation relating to particular alleged securities and tax law violations committed by some of UBS Global AM’s affiliates and certain employees of those affiliates (the "Regulatory Matters”). The Board has monitored the development of the Regulatory Matters, is and was informed on a regular basis by UBS Global AM of the status of the Regulatory Matters and discussed them with UBS Global AM and the Board’s independent counsel when it considered the Recommendation. UBS Global AM, the Fund’s investment adviser, was not involved in the Regulatory Matters and UBS Global AM has represented to the Board that none of the Regulatory Matters involve actions taken by UBS Global AM or its personnel directly and that the alleged "bad acts” are not connected in any way directly with UBS Global AM or its management of the Fund, or the other investment companies for which UBS Global AM acts as investment adviser or investment manager. The Board considered that each of the UBS entities involved in the Regulatory Matters is a corporate entity separate from UBS Global AM. The Board believes that the Regulatory Matters, in and of themselves, therefore are not a defining or conclusive factor to consider in determining whether or not UBS Global AM should be retained as the investment adviser for the Fund.

Certain Regulatory Matters trigger consequences affecting the Fund and its adviser, unless the U.S. Securities and Exchange Commission (the "SEC”) issues special orders. The SEC has issued these orders, apparently in recognition of UBS Global AM’s non-involvement in its affiliates’ alleged actions. As a result, UBS Global AM is permitted to continue to serve as investment adviser to the UBS funds. The relief was based, in part, on the representations of UBS Global AM and the other applicants for the relief that the conduct described in the SEC action did not involve UBS Global AM or any of the other applicants acting in the capacity of investment adviser to any registered investment company and that none of the current or former directors, officers or employees of UBS Global AM had any involvement in the applicable Regulatory Matters. The issuance of this relief indicates to the Board of the Fund that the SEC does not believe that these Regulatory Matters materially affect UBS Global AM’s ability to continue managing the Fund.

The Board wants stockholders to understand that the Board regularly reviews the performance and compliance of UBS Global AM with respect to Fund management. The Board receives quarterly reports from the Fund’s chief compliance officer ("CCO”), and the independent directors generally meet separately with the CCO at each regular Board meeting. The Board believes that UBS Global AM maintains high standards of regulatory compliance and business practice.

Performance Record and Changes to Investment Strategies. Historically, the Fund was designed to provide investors with a more risk aware investment program, focusing on higher quality securities and seeking to preserve capital while being less aggressive in seeking higher yields and outperformance relative to its peers. Responding to market changes, the Fund’s portfolio strategy has been augmented over the past five years to provide more flexibility and to widen the investment opportunity set while still aiming to remain consistent with the Fund’s overall investment goals. The changes have succeeded, and the Fund’s recent performance record relative to its peers has been very competitive, notwithstanding its historically conservative investments. As of December 31, 2008, the Fund’s returns based on net asset value per share have outperformed its peer group median (the Lipper General Muni Debt Funds (Leveraged) closed-end funds peer group) over the past one-, three- and five-year periods. As of March 31, 2009, the Fund outperformed 96%, 86%, and 74% of its Lipper General Muni Debt Funds (Leveraged) closed-end fund peers over the one-, three- and five-year periods, respectively. Similarly, as of March 31, 2009, on a market price basis (also assuming reinvestment of dividends), the Fund’s common stock outperformed 96%, 95% and 62% of its Lipper General Muni Debt Funds (Leveraged) closed-end fund peers over the one-, three- and five-year periods, respectively. The Fund over time has provided a steady stream of tax-exempt income to its stockholders, in keeping with its investment objective.

UBS Global AM, with the encouragement and approval of the Board, has taken a number of actions over time to make the Fund more attractive. These include changes to the Fund’s investment strategies, as well as actions taken to reduce the level of Fund fees and expenses. For instance, in July 2008 UBS Global AM recommended, and the Board approved, a tender option bond program to provide the Fund with an alternative means of leveraging its assets. This program lowered the cost of the Fund’s leverage compared to the rates paid on the Fund’s auction preferred shares (to the benefit of common stockholders) and has facilitated partial redemptions of the Fund’s auction preferred shares. In 2003 the Board approved a fee waiver that reduced the Fund’s effective investment advisory and administration fee to 0.70% of the Fund’s average weekly net assets. In 2006, the Board determined to calculate the investment advisory and administration fee only on net assets attributable to common shares (rather than on all assets, including those attributable to the Fund’s auction preferred shares), further reducing the Fund’s expense ratio. In 2008 the Board approved UBS Global AM’s proposed voluntary fee waiver, which further reduced the effective investment advisory and administration fee to 0.60% of the Fund’s average weekly net assets attributable to common shares.

Although, as noted above, the Fund’s investment performance has been competitive, the Fund’s common shares often trade at a discount to their net asset value. The Board receives and considers information on the Fund’s discount at every regular Board meeting. The Board also periodically considers different possible strategies to address the Fund’s discount (in addition to the reductions in fees and changes to investment strategies discussed above). However, the Board also recognizes that discounts are common among closed-end funds, that the causes are not always clear and that many of these strategies (which generally have attendant costs) may only temporarily reduce the discount and sometimes result in higher ongoing expenses to shareholders. The Board also believes that the primary focus of most of the Fund’s stockholders is the receipt of tax-exempt income. Nevertheless, the Board has considered and will continue to consider possible strategies to reduce the discount, while always keeping in mind the Fund’s investment objective.

The Fund’s Long-term Interest. The Recommendation was made by a stockholder who may have acted solely to force the Fund to negotiate with him and certain other stockholders who often seek to bolster their short-term interest, which the Board believes may not be consistent with the best interests of the Fund. The stockholder is a well-known shareholder activist who frequently targets closed-end funds. It is the Board’s duty to act in what it reasonably believes to be in the best interests of the Fund as a whole, although, as described above, the Board fully considered the Recommendation approved at the annual meeting.¹

You may have seen a recent press release by another activist shareholder asserting that the Board had taken no apparent action with respect to the Recommendation. As you can see, the Board has most definitely considered the Recommendation but, as fully described in this letter, has determined not to implement it. That same press release made reference to possible departures by certain municipal bond portfolio managers from UBS Global AM. Please be assured that your Board was promptly notified of these potential personnel issues and the ability of UBS Global AM to continue to provide expert advisory services to the Fund in the event those issues could not be resolved. We were more than satisfied with the candor of UBS Global AM’s reporting to us, and we were certainly pleased with its recognition of its obligations to the Fund and the need for continuing strong portfolio management leadership. Of course, we are delighted that Kevin McIntyre, the Fund’s portfolio manager, and Ebby Gerry, the Head of Municipal Bonds at UBS Global AM, have determined to remain at UBS Global AM.

Thank you for your attention to this letter and your continuing investment in the Fund.

¹ The stockholder proposal required the approval of a majority of the votes cast at the annual meeting and received 51.10% of the votes cast at the annual meeting, constituting less than 34% of the total outstanding shares. However, another proposal voted on at the annual meeting -- the proposal to approve a new advisory and administration contract between the Fund and UBS Global AM with lower contractual fees -- received a favorable vote of 52.43% of the votes cast at the annual meeting (although it did not pass because of the higher voting requirement needed to pass this proposal). In addition, a third proposal voted on at the annual meeting -- the proposal that the investment advisory agreement between the Fund and UBS Global AM be terminated -- received 50.80% of the votes cast in favor at the annual meeting, and was not approved because it did not receive the required vote. The voting results do not indicate a clear consensus of the stockholders to replace UBS Global AM as the Fund’s investment adviser.