SCD LMP Capital and Income Fund Inc

LMP Capital and Income Fund Inc., which is listed on the New York Stock Exchange under the symbol "SCD," today announced changes to its managed distribution policy that will take effect beginning in 2009. The Fund, which had declared previously monthly distributions of $0.1400 per common share payable in the months of November and December 2008, will pay distributions quarterly beginning with the quarter ended March 2009. In addition, the Fund will change the methodology it uses to determine its distribution rate. The Fund, which previously had declared a set monthly distribution rate, will begin setting its quarterly distribution rate based on a percentage of the Fund�s net asset value per share on December 31, 2008. The Board of Directors of the Fund has approved an annual distribution rate, for the 2009 calendar year, of a minimum of approximately 5% of the net asset value of the Fund as of the close of trading on December 31, 2008. The Fund may make additional distributions as necessary to meet certain tax requirements. Fund management believes that this will provide the investment manager with greater flexibility in managing the Fund�s assets, and that payment of quarterly distributions will better match the cash flows (quarterly dividends for common equities and semi-annual interest payments from fixed income investments) of securities held in the Fund�s portfolio. Additionally, the Fund believes it will realize incremental cost savings from providing investors with required shareholder notices (�Section 19 Notices�) on the source of distributions quarterly rather than monthly as is its current practice. In announcing the changes to its managed distribution policy, the Fund cited the deteriorating economic environment and the decline in equity and fixed income valuations during the past year, which accelerated beginning in the second half of 2008. These declines have led to a reduction in the level of capital gains and income available from the Fund�s equity and fixed income investments. Whereas the Fund�s distribution strategy previously encompassed a combination of net investment income and potential short-term and long-term capital gains, the current environment makes it more likely that future distributions will rely less heavily on a capital gains component and more on net investment income generated by the portfolio. The Fund also utilizes a line of credit to enhance portfolio returns; this line of credit provides the Fund with the ability to moderate its use as market conditions and opportunities change. As a result of the manager�s investment outlook and the need to maintain asset coverage requirements, the Fund has reduced its use of leverage to $145 million as of October 31, 2008. This is down from $170 million as reported in the Fund's semi-annual report dated April 30, 2008. These changes are intended to help improve the overall, long-term performance of the Fund. It is anticipated that these actions will, over time, allow the Fund to rebuild its asset base through the capital appreciation of the underlying investments and will allow the investment manager to focus on longer-term performance that could ultimately result in increased distributions should the Fund�s net asset value increase. There can be no assurance, however, that the investment manager will be able to achieve these goals. Under the terms of the Fund's revised managed distribution policy, the Fund will seek to maintain a consistent quarterly distribution level stated as a fixed percentage of its December 31, 2008 net asset value per share, that may be paid in part or in full from net investment income and realized capital gains, or a combination thereof. Shareholders should note, however, that if the Fund's aggregate net investment income and net realized capital gains are less than the amount of the quarterly distribution level, the difference will be distributed from the Fund's assets and will constitute a return of the shareholder's capital. A return of capital is not taxable as a dividend; rather it reduces a shareholder's tax basis in his or her shares of the Fund with any balance in excess of the tax basis treated as a capital gain. The Board of Directors may reduce the Fund's quarterly distribution rate in the future or terminate or suspend the managed distribution policy at any time. Any such reduction in the quarterly distribution rate, termination or suspension could have an adverse effect on the market price of the Fund's shares. On November 19, 2008 at 4:15 p.m. the Fund will host a conference call featuring Robert Gendelman, Managing Director of ClearBridge Advisors and the Fund's portfolio manager. Mr. Gendelman will provide an overview of the Fund, a discussion of current market conditions and his investment outlook. Conference Call: � Date: November 19, 2008 Time: 4:15 p.m. (Eastern) Dial-in Number: USA Toll Free Number: 1-888-995-9715 USA Toll Number 1-630-395-0450 Passcode: Closed End Questions will be accepted in advance of the call at cef@leggmason.com. Shortly after the call, a replay will be available. The replay dial-in number is Dial-In Number: � USA Toll Free Number: 1-800-388-4991 USA Toll Number 1-203-369-3668 The replay will also be available on the Fund�s web site at www.leggmason.com/cef. LMP Capital and Income Fund Inc. is a non-diversified, closed-end management investment company. Legg Mason Partners Fund Advisor, LLC, a wholly-owned subsidiary of Legg Mason, Inc., serves as the Fund's investment manager and is sub-advised by ClearBridge Advisors, LLC, and Western Asset Management Company and Western Asset Management Company Limited, affiliates of the investment manager. Contact the Fund at 1-888-777-0102 for additional information, or consult the Fund�s web site at www.leggmason.com/cef.