Morgan Stanley North American Government Income Tr – ‘485APOS’ on 4/26/99

As of:  Monday, 4/26/99   ·   Accession #:  950136-99-536   ·   File #s:  33-46049, 811-06572

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Post-Effective Amendment
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 485APOS     Post-Effective Amendment                              64    295K 
 2: EX-99.B2    By Laws                                               11     54K 

485APOS   —   Post-Effective Amendment
Document Table of Contents

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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 26, 1999  
                                                     REGISTRATION NOS.: 33-46049
                                                                        811-6572
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

----------------

 FORM N-1A
                           REGISTRATION STATEMENT                            [X]
                      UNDER THE SECURITIES ACT OF 1933                       [ ]
                         PRE-EFFECTIVE AMENDMENT NO.                         [X]
POST-EFFECTIVE AMENDMENT NO. 8
AND/OR
             REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY             [ ]
                                 ACT OF 1940                                 [X]
 AMENDMENT NO. 9

----------------

 TCW/DW NORTH AMERICAN GOVERNMENT INCOME TRUST
(A MASSACHUSETTS BUSINESS TRUST)
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)

TWO WORLD TRADE CENTER
NEW YORK, NEW YORK 10048
 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICE)

REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (212) 392-1600

BARRY FINK, ESQ.
TWO WORLD TRADE CENTER
NEW YORK, NEW YORK 10048
 (NAME AND ADDRESS OF AGENT FOR SERVICE)

----------------

COPY TO:

 DAVID M. BUTOWSKY, ESQ.
GORDON ALTMAN BUTOWSKY
 WEITZEN SHALOV & WEIN
114 WEST 47TH STREET
NEW YORK, NEW YORK 10036

----------------

 APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING:

As soon as practicable after this Post-Effective Amendment becomes effective. 

IT IS PROPOSED THAT THIS FILING WILL BECOME EFFECTIVE (CHECK APPROPRIATE BOX) 

[ ] immediately upon filing pursuant to paragraph (b)         

[ ] on March 29, 1999 pursuant to paragraph (b)               

[ ] 60 days after filing pursuant to paragraph (a)            

[X] on June 25, 1999 pursuant to paragraph (a) of rule 485.   

 AMENDING THE PROSPECTUS
================================================================================

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 TCW/DW NORTH AMERICAN GOVERNMENT INCOME TRUST

 CROSS-REFERENCE SHEET

 FORM N-1A

ITEM                                CAPTION                       
----                                -------                       

PART A                                    PROSPECTUS                            

1.    ..........   Cover Page; Back Cover                                   
2.    ..........   Investment Objective; Principal Investment               
           Strategies, Principal Risks, Past Performance
3.    ..........   Fees and Expenses                                        
4.    ..........   Investment Objective; Additional Investment              
               Strategy Information; Additional Risk Information
5.    ..........   Not Applicable                                           
6.    ..........   Fund Management                                          
7.    ..........   Pricing Fund Shares; Buying and Selling Shares; How to   
                 Exchange Shares; How to Sell Shares; Distributions;
Tax Consequences                  
8.    ..........   Share Class Arrangments                                  
9.    ..........   Financial Highlights                                     

PART B                 STATEMENT OF ADDITIONAL INFORMATION                      

Information required to be included in Part B is set forth under the  
appropriate caption in Part B of this Registration Statement.                   

PART C                                                                          

Information required to be included in Part C is set forth under the  
appropriate item, so numbered, in Part C of this Registration Statement.        

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                                              PROSPECTUS - JUNE 25, 1999

MORGAN STANLEY DEAN WITTER                                                      

           ---------------------------------------------------------------------

                                        NORTH AMERICAN GOVERNMENT INCOME TRUST

                        A MUTUAL FUND THAT SEEKS TO EARN A HIGH LEVEL OF CURRENT
                           INCOME WHILE MAINTAINING RELATIVELY LOW VOLATILITY OF
                                                                       PRINCIPAL

The Securities and Exchange Commission has not approved or disapproved these
securities or passed upon the adequacy of this Prospectus. Any representation to
the contrary is a criminal offense. 

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CONTENTS                                                                        

The Fund                  Investment Objective ..............................1  

                        Principal Investment Strategies ...................1

                        Principal Risks ...................................1

                        Past Performance ..................................3

                        Fees and Expenses .................................4

                        Additional Investment Strategy Information ........4

                        Additional Risk Information .......................5

                        Fund Management ...................................8

Shareholder Information   Pricing Fund Shares ...............................9  

                        How to Buy Shares .................................9

                        How to Exchange Shares ...........................10

                        How to Sell Shares ...............................13

                        Distributions ....................................14

                        Tax Consequences .................................14

Financial Highlights      ..................................................16  

                        This Prospectus contains important information about
                      the Fund. Please read it carefully and keep it for
future reference.           

FUND CATEGORY                                                         
-------------                                                         
[ ] Growth                                                                    
[ ] Growth and Income                                                         
[X] INCOME                                                                    
[ ] Money Market                                                              

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THE FUND                                                                        

INVESTMENT OBJECTIVE                                                            
--------------------                                                            

Morgan Stanley Dean Witter North American Government Income Trust is a mutual   
fund that seeks to earn a high level of current income while maintaining        
relatively low volatility of principal. There is no guarantee that the Fund     
will achieve this objective.                                                    

PRINCIPAL INVESTMENT STRATEGIES                                                 
-------------------------------                                                 

(sidebar)                                                                       
INCOME                                                                          
An investment objective having the goal of selecting securities to pay out      
income rather than rise in value.                                               
(end sidebar)                                                                   

The Fund will normally invest at least 65% of its assets in investment grade    
fixed-income securities issued or guaranteed by the United States, Canadian or  
Mexican governments, their agencies or instrumentalities. These securities are  
referred to generally as "government securities." In the case of the United     
States and Canada, a substantial portion of these securities will be            
mortgage-backed securities. The Fund will normally invest at least fifty        
percent of its assets in U.S. government securities, and no more than           
twenty-five percent each in Canadian or Mexican government securities.          

The Fund's "Sub-Advisor," TCW Funds Management, Inc., will allocate Fund assets 
among the three countries based on its analysis of market, economic and         
political conditions in those countries. The Sub-Advisor will consider various  
factors, such as changes in interest rates and currency exchange rates, to      
attempt to take advantage of favorable investment opportunities in each         
country. The Sub-Advisor expects that, under normal circumstances, the weighted 
average maturity of the Fund's investment securities will be no greater than 3  
years.                                                                          

MORTGAGE-BACKED SECURITIES. One type of mortgage-backed security, in which the  
Fund may invest, is a mortgage pass-through security. These securities          
represent a participation interest in a pool of residential mortgage loans      
originated by governmental or private lenders such as banks. They differ from   
conventional debt securities, which provide for periodic payment of interest in 
fixed amounts and principal payments at maturity or on specified call dates.    
Mortgage pass-through securities provide for monthly payments that are a        
"pass-through" of the monthly interest and principal payments made by the       
individual borrowers on the pooled mortgage loans.                              

OTHER SECURITIES. The Fund may invest up to 35% of its assets in securities     
that are not government securities. This group of securities also will be       
issued by U.S., Canadian or Mexican issuers and may include corporate debt      
securities and securities backed by other assets, such as automobile or credit  
card receivables or home equity loans. They are rated at least Aa by Moody's    
Investors Services or AA by Standard & Poor's or, if not rated, determined to   
be of comparable quality by the Sub-Advisor.                                    

PRINCIPAL RISKS                                                                 
---------------                                                                 

The Fund's share price will fluctuate with changes in the market value of the   
Fund's portfolio securities. When you sell Fund shares, they may be worth less  
than what you paid for them and, accordingly, you can lose money investing in   
this Fund.                                                                      

FIXED-INCOME SECURITIES. The Fund's investments in fixed-income securities are  
subject to two types of risk: credit risk and interest rate risk.               

                                                                               1

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FOREIGN SECURITIES. The Fund is subject to the risks associated with foreign    
securities generally. These risks include, among other things, the possibility  
that the Fund could be adversely affected by changes in currency exchange       
rates.                                                                          

MORTGAGE-BACKED SECURITIES. There are particular risks associated with the      
Fund's investment in mortgage-backed securities. For example, these securities  
are subject to prepayment risks and in some cases may be more volatile and less 
liquid than other traditional types of debt securities.                         

CANADIAN AND MEXICAN SECURITIES. The Canadian debt securities market is         
significantly smaller than the U.S. debt securities market. In particular, the  
Canadian mortgage-backed securities market is of recent origin, and, although   
continued growth is anticipated, is less well developed and less liquid than    
its U.S. counterpart.                                                           

Because the Fund intends to invest in Mexican debt instruments, investors in    
the Fund should be aware of certain special considerations associated with      
investing in debt obligations of the Mexican government.                        

The Mexican government has exercised and continues to exercise a significant    
influence over many aspects of the private sector in Mexico. Mexican government 
actions concerning the economy could have a significant effect on market        
conditions and prices and yields of Mexican debt obligations, including those   
in which the Fund invests. Mexico is currently a major debtor nation (among     
developing countries) to commercial banks and foreign governments.              

The value of the Fund's investments may be affected by changes in oil prices,   
interest rates, taxation and other political or economic developments in        
Mexico, including recent rates of inflation which have exceeded the rates of    
inflation in the U.S. and Canada. The Fund can provide no assurance that future 
developments in the Mexican economy will not impair the Fund's investment       
flexibility, operations or ability to achieve its investment objective.         

OTHER RISKS. The performance of the Fund also will depend on whether the        
Sub-Advisor is successful in pursuing the Fund's investment strategy. In        
addition, the Fund is subject to other risks from its permissible investments.  
For information about these risks, as well as more detailed information about   
the risks summarized in this section, see the "Additional Risk Information"     
section.                                                                        

2                                                                               

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PAST PERFORMANCE                                                                
----------------                                                                

The bar chart and table below provide some indication of the Fund's performance 
history. The Fund's past performance does not indicate how the Fund will        
perform in the future.                                                          

(sidebar)                                                                       
ANNUAL TOTAL RETURNS                                                            
This chart shows how the performance of the Fund's shares has varied from year  
to year for the past six calendar years.                                        
(end sidebar)                                                                   

ANNUAL TOTAL RETURNS -- CALENDAR YEARS                                          

1993     '94    '95    '96    '97    '98
----     ---    ---    ---    ---    ---

(sidebar)                                                                       
AVERAGE ANNUAL TOTAL RETURNS                                                    
This table compares the Fund's average annual returns with those of a broad     
measure of market performance over time.                                        
(end sidebar)                                                                   

During the periods shown in the bar chart, the highest return for a calendar    
quarter was   % (quarter ended          ) and the lowest return for a calendar  
quarter was   % (quarter ended       ). Year-to-date total return as of         
March 31, 1999 was    %.                                                        

AVERAGE ANNUAL TOTAL RETURNS (FOR THE PERIODS ENDED THE 1998 CALENDAR YEAR)     

                                                        [Enlarge/Download Table]

------------------------------------------------------------------------------------------
                                                                               LIFE OF    
                                                                              PORTFOLIO   
                                                           PAST 1 YEAR     (SINCE 7/31/92)
------------------------------------------------------------------------------------------
                                                                                          
 North American Government Securities Trust                   --%               --%       
------------------------------------------------------------------------------------------
 Lehman Brothers Short (1-5) U.S. Government Index(1)         --%               --%       
------------------------------------------------------------------------------------------
 Lipper Variable Annuity Global Income Underlying                                         
------------------------------------------------------------------------------------------
 Funds Average(2)                                             --%               --%%      
------------------------------------------------------------------------------------------

(1)   The Lehman Brothers Short (1-5) U.S. Government Index measures the        
  performance of all U.S. Government agency and U.S. Treasury securities
with maturities of one to five years. The Index does not include any
expenses, fees or charges. The Index is unmanaged and should not be 
considered an investment.                                           

(2)   The Lipper Variable Annuity Global Income Underlying Funds Average tracks 
    the performance of funds that state in their prospectus that they invest
   primarily in U.S. dollar and non-U.S. dollar debt securities of issuers
located in at least three countries, one of which may be the United 
States, as reported by Lipper Analytical Service.                   

                                                                               3

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FEES AND EXPENSES                                                               
-----------------                                                               

The table below briefly describes the fees and expenses that you may pay if you 
buy and hold shares of the Fund. The Fund does not impose any sales charges and 
does not charge account or exchange fees.                                       

(sidebar)                                                                       
ANNUAL FUND OPERATING EXPENSES                                                  
These expenses are deducted from the Fund's assets and are based on expenses    
paid for the fiscal year ended October 31, 1998.                                
(end sidebar)                                                                   

ANNUAL FUND OPERATING EXPENSES                                                  
------------------------------------------------                                
Management fee                            0.65%                               
------------------------------------------------                                
Distribution and service (12b-1) fees     0.73%                               
------------------------------------------------                                
Other expenses                            0.31%                               
------------------------------------------------                                
Total annual Fund operating expenses      1.69%                               
------------------------------------------------                                

EXAMPLE                                                                         
This example is intended to help you compare the cost of investing in the Fund  
with the cost of investing in other mutual funds.                               

The example assumes that you invest $10,000 in the Fund, your investment has a  
5% return each year, and the Fund's operating expenses remain the same.         
Although your actual costs may be higher or lower, the tables below shows your  
costs at the end of each period based on these assumptions                      

1 YEAR     3 YEARS     5 YEARS     10 YEARS                           
------------------------------------------------                                
$          $           $           $                                  
------------------------------------------------                                

ADDITIONAL INVESTMENT STRATEGY INFORMATION                                      
------------------------------------------                                      

The Fund seeks to earn a high level of current income while maintaining         
relatively low volatility of principal. There is no guarantee that the Fund     
will achieve this objective.                                                    

This section provides additional information concerning the Fund's principal    
investment strategies.                                                          

DEFENSIVE INVESTING. The Fund may take temporary "defensive" positions in       
attempting to respond to adverse market conditions. The Fund may invest any     
amount of its assets in cash or money market instruments in a defensive posture 
when the Sub-Advisor believes it is advisable to do so. Although taking a       
defensive posture is designed to protect the Fund from an anticipated market    
downturn, it could have the effect of reducing the benefit from any upswing in  
the market or otherwise affect the Fund's ability to meet its investment        
objective.                                                                      

The percentage limitations relating to the composition of the Fund's portfolio  
referenced in "Principal Investment Strategies" apply at the time the Fund      
acquires an investment. Subsequent percentage changes that result from market   
fluctuations or changes in assets will not require the Fund to sell any         
portfolio security. The Fund may change its principal investment strategies     
without shareholder approval; however, you would be notified of any changes.    

4                                                                               

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ADDITIONAL RISK INFORMATION                                                     
---------------------------                                                     

This section provides additional information regarding the principal risks of   
investing in the Fund.                                                          

FIXED-INCOME SECURITIES. All fixed-income securities are subject to two types   
of risk: credit risk and interest rate risk. Credit risk refers to the          
possibility that the issuer of a security will be unable to make interest       
payments and/or repay the principal on its debt.                                

Interest rate risk refers to fluctuations in the value of a fixed-income        
security resulting from changes in the general level of interest rates. When    
the general level of interest rates goes up, the prices of most fixed-income    
securities go down. When the general level of interest rates goes down, the     
prices of most fixed-income securities go up. (Zero coupon securities are       
typically subject to greater price fluctuations than comparable securities that 
pay interest.) Accordingly, a rise in the general level of interest rates may   
cause the price of the Fund's fixed-income securities to fall substantially. As 
merely illustrative of the relationship between fixed-income securities and     
interest rates, the following table shows how interest rates affect bond        
prices.                                                                         

                                                                [Download Table]

HOW INTEREST RATES AFFECT BOND PRICES                                     
--------------------------------------------------------------------------
                             PRICE PER $1,000 OF A BOND IF INTEREST RATES:
                             ---------------------------------------------
                                   INCREASE                DECREASE       
                             ---------------------------------------------
BOND MATURITY      COUPON        1%          2%          1%          2%   
--------------------------------------------------------------------------
                                                                          
 1 YEAR             N/A    $1,000      $1,000        $1,000      $1,000   
--------------------------------------------------------------------------
 5 years           4.25%     $967        $934        $1,038      $1,076   
--------------------------------------------------------------------------
 10 years          4.75%     $930        $867        $1,074      $1,155   
--------------------------------------------------------------------------
 30 years          5.25%     $865        $756        $1,166      $1,376   
--------------------------------------------------------------------------

Coupons reflect yields on Treasury securities as of December 31, 1998. The      
table is not representative of price changes for mortgage-backed securities     
principally because of prepayments, and it is not representative of junk bonds. 
In addition, the table is an illustration and does not represent expected       
yields or share price changes of any Morgan Stanley Dean Witter mutual fund.    

MORTGAGE-BACKED SECURITIES. Mortgage-backed securities have different risk      
characteristics than traditional debt securities. Although generally the value  
of fixed-income securities increases during periods of falling interest rates   
and decreases during periods of rising interest rates, this is not always the   
case with mortgage-backed securities. This is due to the fact that principal on 
underlying mortgages may be prepaid at any time as well as other factors.       
Generally, prepayments will increase during a period of falling interest rates  
and decrease during a period of rising interest rates. The rate of prepayments  
also may be influenced by economic and other factors. Prepayment risk includes  
the possibility that, as interest rates fall, securities with stated interest   
rates may have the principal prepaid earlier than expected, requiring the Fund  
to invest the proceeds at generally lower interest rates.                       

Investments in mortgage-backed securities are made based upon, among other      
things, expectations regarding the rate of prepayments on underlying mortgage   
pools. Rates of prepayment, faster or slower than expected by the Investment    
Manager or Sub-Advisor, could reduce the Fund's yield, increase the volatility  
of the Fund and/or cause a                                                      

                                                                               5

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decline in net asset value. Certain mortgage-backed securities in which the     
Fund may invest may be more volatile and less liquid than other traditional     
types of debt securities.                                                       

FOREIGN SECURITIES. Foreign securities (including depository receipts) involve  
risks in addition to the risks associated with domestic securities. One         
additional risk is currency risk. While the price of Fund shares is quoted in   
U.S. dollars, the Fund generally converts U.S. dollars to a foreign market's    
local currency to purchase a security in that market. If the value of that      
local currency falls relative to the U.S. dollar, the U.S. dollar value of the  
foreign security will decrease. This is true even if the foreign security's     
local price remains unchanged.                                                  

Foreign securities also have risks related to economic and political            
developments abroad, including effects of foreign social, economic or political 
instability. Foreign companies, in general, are not subject to the regulatory   
requirements of U.S. companies and, as such, there may be less publicly         
available information about these companies. Moreover, foreign accounting,      
auditing and financial reporting standards generally are different from those   
applicable to U.S. companies. Finally, in the event of a default of any foreign 
debt obligations, it may be more difficult for the Fund to obtain or enforce a  
judgment against the issuers of the securities.                                 

Securities of foreign issuers may be less liquid than comparable securities of  
U.S. issuers and, as such, their price changes may be more volatile.            
Furthermore, foreign exchanges and broker-dealers are generally subject to less 
government and exchange scrutiny and regulation than their U.S. counterparts.   

The Mexican securities in which the Fund may invest are issued by a developing  
country. Compared to the United States and other developed countries,           
developing countries may have relatively unstable governments, economies based  
on only a few industries and securities markets that trade a small number of    
securities. Prices of these securities tend to be especially volatile and, in   
the past, securities in these countries have offered greater potential loss (as 
well as gain) than securities of companies located in developed countries.      

OPTIONS AND FUTURES. If the Fund invests in options and/or futures, its         
participation in these markets would subject it to certain risks. The           
Investment Manager's or Sub-Advisor's predictions of movements in the direction 
of the stock, bond, currency or interest rate markets may be inaccurate, and    
the adverse consequences to the Fund (e.g., a reduction in the Fund's net asset 
value or a reduction in the amount of income available for distribution) may    
leave the Fund in a worse position than if these strategies were not used.      
Other risks inherent in the use of options and futures include, for example,    
the possible imperfect correlation between the price of options and futures     
contracts and movements in the prices of the securities being hedged, and the   
possible absence of a liquid secondary market for any particular instrument.    
Certain options may be over-the-counter options, which are options negotiated   
with dealers; there is no secondary market for these investments.               

FORWARD CURRENCY CONTRACTS. The Fund's participation in forward currency        
contracts also involves risks. If the Investment Manager or Sub-Advisor employs 
a strategy that does not correlate well with the Fund's investments or the      
currencies in                                                                   

6                                                                               

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which the investments are denominated, currency contracts could result in a     
loss. The contracts also may increase the Fund's volatility and may involve a   
significant risk.                                                               

NON-DIVERSIFIED STATUS. The Fund is a "non-diversified" mutual fund and, as     
such, its investments are not required to meet certain diversification          
requirements under federal law. Compared with "diversified" funds, the Fund may 
invest a greater percentage of its assets in the securities of an individual    
governmental entity. Thus, the Fund's assets may be concentrated in fewer       
securities than other funds. A decline in the value of those investments would  
cause the Fund's overall value to decline to a greater degree.                  

YEAR 2000. The Fund could be adversely affected if the computer systems         
necessary for the efficient operation of the Investment Manager, the            
Sub-Advisor and the Fund's other service providers, as well as the markets and  
individual and governmental issuers in which the Fund invests do not properly   
process and calculate date-related information from and after January 1, 2000.  
While year 2000-related computer problems could have a negative effect on the   
Fund, the Investment Manager, Sub-Advisor and affiliates are working hard to    
avoid any problems and to obtain assurances from their service providers that   
they are taking similar steps.                                                  

In addition, it is possible that the markets for securities in which the Fund   
invests may be detrimentally affected by computer failures throughout the       
financial services industry beginning January 1, 2000. Improperly functioning   
trading systems may result in settlement problems and liquidity issues. In      
addition, corporate and governmental data processing errors may result in       
production problems for individual companies and overall economic               
uncertainties. Earnings of individual issuers will be affected by remediation   
costs, which may be substantial and may be reported inconsistently in U.S. and  
foreign financial statements. Accordingly, the Fund's investments may be        
adversely affected.                                                             

                                                                               7

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FUND MANAGEMENT                                                                 
---------------                                                                 

(sidebar)                                                                       
MORGAN STANLEY DEAN WITTER ADVISORS INC.                                        
The Investment Manager is widely recognized as a leader in the mutual fund      
industry and together with Morgan Stanley Dean Witter Services Company Inc.,    
its wholly-owned subsidiary, has more than $      billion in assets under       
management or administration as of May 31, 1999.                                
(end sidebar)                                                                   

The Fund has retained the Investment Manager - Morgan Stanley Dean Witter       
Advisors Inc. - to provide administrative services, manage its business affairs 
and supervise the investment of its assets. The Investment Manager has, in turn,
contracted with the Sub-Advisor - TCW Funds Management, Inc. - to invest the    
Funds assets, including the placing of orders for the purchase and sale of      
portfolio securities. TCW Funds Management, Inc. has been the Sub-Advisor of    
the Fund since June 25, 1999. Prior to that TCW Funds Management, Inc. acted as 
the Fund's advisor and Morgan Stanley Dean Witter Services Company Inc. was the 
Fund's manager. The Investment Manager is a wholly-owned subsidiary of Morgan   
Stanley Dean Witter & Co., a preeminent global financial services firm that     
maintains leading market positions in each of its three primary businesses:     
securities, asset management and credit services. Its main business office is   
located at Two World Trade Center, New York, New York 10048.                    

The Sub-Advisor is a wholly-owned subsidiary of TCW Group, Inc., whose direct   
and indirect subsidiaries provide a variety of trust, investment management and 
investment advisory services. The Sub-Advisor's main business office is located 
at 865 South Figueroa Street, Suite 1800, Los Angeles, California 90017.        

Philip A. Barach and Jeffrey E. Gundlach, Group Managing Directors of the       
Sub-Advisor, and James M. Goldberg and Frederick H. Horton, Managing Directors  
of the Sub-Advisor, are the Fund's primary portfolio managers, and, with the    
exception of Mr. Horton, have been so since the Fund's inception. Mr. Horton    
has been a primary portfolio manager since December, 1994. Messrs. Barach,      
Gundlach, Goldberg and Horton have each been portfolio managers with affiliates 
of the Sub-Advisor for over five years.                                         

The Fund pays the Investment Manager a monthly management fee as full           
compensation for the services and facilities furnished to the Fund, and for     
Fund expenses assumed by the Investment Manager. The fee is based on the Fund's 
average daily net assets. The Investment Manager pays the Sub-Advisor monthly   
compensation equal to 40% of this fee. For the fiscal year ended October 31,    
1998 the Fund accrued aggregate total compensation to Morgan Stanley Dean       
Witter Services Company Inc. (the Fund's former manager) and TCW Funds          
Management, Inc. (at that time acting as the Fund's advisor, rather than        
sub-advisor) of 0.65% of the Fund's average daily net assets (0.39% to Morgan   
Stanley Dean Witter Services Company Inc. and 0.26% to TCW Funds Management,    
Inc.).                                                                          

8                                                                               

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SHAREHOLDER INFORMATION                                                         

PRICING FUND SHARES                                                             
-------------------                                                             

The price of Fund shares (excluding sales charges), called "net asset value,"   
is based on the value of the Fund's portfolio securities. The net asset value   
of each Class, however, will differ because the Classes have different ongoing  
distribution fees.                                                              

The net asset value per share of the Fund is determined once daily at 4:00 p.m. 
Eastern time, on each day that the New York Stock Exchange is open (or, on days 
when the New York Stock Exchange closes prior to 4:00 p.m., at such earlier     
time). Shares will not be priced on days that the New York Stock Exchange is    
closed.                                                                         

The value of the Fund's portfolio securities is based on the securities' market 
price when available. When a market price is not readily available, including   
circumstances under which the Investment Manager and/or Sub-Advisor determines  
that a security's market price is not accurate, a portfolio security is valued  
at its fair value, as determined under procedures established by the Fund's     
Board of Trustees. In these cases, the Fund's net asset value will reflect      
certain portfolio securities' fair value rather than their market price.        

An exception to the Fund's general policy of using market prices concerns its   
short-term debt portfolio securities. Debt securities with remaining maturities 
of sixty days or less at the time of purchase are valued at amortized cost.     
However, if the cost does not reflect the securities' market value, these       
securities will be valued at their fair value.                                  

HOW TO BUY SHARES                                                               
-----------------                                                               

(sidebar)                                                                       
CONTACTING A FINANCIAL ADVISOR                                                  
If you are new to the Morgan Stanley Dean Witter Family of Funds and would like 
to contact a Financial Advisor, call (800) THE-DEAN for the telephone number of 
the Morgan Stanley Dean Witter office nearest you. You may also access our      
office locator on our Internet site at: www.deanwitter.com/funds                
(end sidebar)                                                                   

You may open a new account to buy Fund shares or buy additional Fund shares for 
an existing account by contacting your Morgan Stanley Dean Witter Financial     
Advisor or other authorized financial representative. Your Financial Advisor    
will assist you, step-by-step, with the procedures to invest in the Fund. You   
may also purchase shares directly by calling the Fund's transfer agent and      
requesting an application.                                                      

When you buy Fund shares, the shares are purchased at the next share price      
calculated after we receive your investment order as described below. We        
reserve the right to reject any order for the purchase of Fund shares.          

                                                                               9

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(sidebar)                                                                       
EASYINVEST(SM)                                                                  
A purchase plan that allows you to transfer money automatically from your       
checking or savings account or from a Money Market Fund on a semi-monthly,      
monthly or quarterly basis. Contact your Morgan Stanley Dean Witter Financial   
Advisor for further information about this service.                             
(end sidebar)                                                                   

                                                                [Download Table]

MINIMUM INVESTMENT AMOUNTS                                                    
------------------------------------------------------------------------------
                                                        MINIMUM INVESTMENT    
                                                    --------------------------
INVESTMENT OPTIONS                                    INITIAL     ADDITIONAL  
------------------------------------------------------------------------------
                                                                              
 Regular accounts:                                    $1,000          $100    
 EasyInvest(SM)        (Automatically from your                               
                       checking or savings account                            
                       or Money Market Fund)          $100*           $100*   
------------------------------------------------------------------------------

* Provided your schedule of investments totals $1,000 in twelve months.         

There is no minimum investment amount if you purchase Fund shares through: (1)  
the Investment Manager's mutual fund asset allocation plan, (2) a program,      
approved by the Fund's distributor, in which you pay an asset-based fee for     
advisory, administrative and/or brokerage services, or (3) employer-sponsored   
employee benefit plan accounts.                                                 

THREE DAY SETTLEMENT. Fund shares are sold through the Fund's distributor,      
Morgan Stanley Dean Witter Distributors Inc., on a normal three business day    
basis; that is, your payment for Fund shares is due on the third business day   
(settlement day) after you place a purchase order.                              

SUBSEQUENT INVESTMENTS SENT DIRECTLY TO THE FUND. In addition to buying         
additional Fund shares for an existing account by contacting your Morgan        
Stanley Dean Witter Financial Advisor, you may send a check directly to the     
Fund. To buy additional shares in this manner:                                  

o Write a "letter of instruction" to the Fund specifying the name(s) on the     
account, the account number, the social security or tax identification      
number, and the investment amount (which would include any applicable       
front-end sales charge). The letter must be signed by the account owner(s). 

o Make out a check for the total amount payable to: Morgan Stanley Dean Witter  
North American Government Income Trust.                                     

o Mail the letter and check to Morgan Stanley Dean Witter Trust FSB at P.O. Box 
1040, Jersey City, NJ 07303.                                                

PLAN OF DISTRIBUTION  The Fund has adopted a Plan of Distribution in accordance 
with Rule 12b-1 under the Investment Company Act of 1940. The Plan allows the   
Fund to pay distribution fees of up to 0.75% for the sale and distribution of   
these shares. It also allows the Fund to pay for services to shareholders.      
Because these fees are paid out of the Fund's assets on an ongoing basis, over  
time these fees will increase the cost of your investment and may cost you more 
than paying other types of sales charges.                                       

HOW TO EXCHANGE SHARES                                                          
----------------------                                                          

PERMISSIBLE FUND EXCHANGES.  You may only exchange shares of the Fund for       
shares of other continuously offered Morgan Stanley Dean Witter Funds if the    
Fund shares were acquired in an exchange of shares initially purchased in a     
Multi-Class Fund or an FSC Fund (subject to a front-end sales charge). In that  
case, the shares may be                                                         

10                                                                              

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subsequently re-exchanged for shares of the same Class of any Multi-Class Fund  
or FSC Fund or for shares of a Money Market Fund, No-Load Fund or Short-Term    
U.S. Treasury Trust. Of course, if an exchange is not permitted, you may sell   
shares of the Fund and buy another Fund's shares with the proceeds.             

See the inside back cover of this Prospectus for each Morgan Stanley Dean       
Witter Fund's designation as a Multi-Class Fund, FSC Fund, No-Load Fund or      
Money Market Fund. If a Morgan Stanley Dean Witter Fund is not listed, consult  
the inside back cover of that Fund's Prospectus for its designation. For        
purposes of exchanges, shares of FSC Funds are treated as Class A shares of a   
Multi-Class Fund.                                                               

The current Prospectus for each fund describes its investment objective(s),     
policies and investment minimums, and should be read before investing.          

EXCHANGE PROCEDURES. You can process an exchange by contacting your Morgan      
Stanley Dean Witter Financial Advisor or other authorized financial             
representative. Otherwise, you must forward an exchange privilege authorization 
form to the Fund's transfer agent--Morgan Stanley Dean Witter Trust FSB--and    
then write the transfer agent or call (800) 869-NEWS to place an exchange       
order. You can obtain an exchange privilege authorization form by contacting    
your Financial Advisor or other authorized financial representative, or by      
calling (800) 869-NEWS. If you hold share certificates, no exchanges may be     
processed until we have received all applicable share certificates.             

An exchange to any Morgan Stanley Dean Witter Fund (except a Money Market Fund) 
is made on the basis of the next calculated net asset values of the Funds       
involved after the exchange instructions are accepted. When exchanging into a   
Money Market Fund, the Fund's shares are sold at their next calculated net      
asset value and the Money Market Fund's shares are purchased at their net asset 
value on the following business day.                                            

The Fund may terminate or revise the exchange privilege upon required notice.   
Certain services normally available to shareholders of Money Market Funds,      
including the check writing privilege, are not available for Money Market Fund  
shares you acquire in an exchange.                                              

TELEPHONE EXCHANGES. For your protection when calling Morgan Stanley Dean       
Witter Trust FSB, we will employ reasonable procedures to confirm that exchange 
instructions communicated over the telephone are genuine. These procedures may  
include requiring various forms of personal identification such as name,        
mailing address, social security or other tax identification number. Telephone  
instructions also may be recorded.                                              

Telephone instructions will be accepted if received by the Fund's transfer      
agent between 9:00 a.m. and 4:00 p.m. Eastern time, on any day the New York     
Stock Exchange is open for business. During periods of drastic economic or      
market changes, it is possible that the telephone exchange procedures may be    
difficult to implement, although this has not been the case with the Fund in    
the past.                                                                       

MARGIN ACCOUNTS. If you have pledged your Fund shares in a margin account,      
contact your Morgan Stanley Dean Witter Financial Advisor or other authorized   
financial representative regarding restrictions on the exchange of such shares. 

                                                                              11

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EXCHANGING SHARES OF ANOTHER FUND SUBJECT TO A CONTINGENT DEFERRED SALES CHARGE 
("CDSC").  There are special considerations when you exchange shares subject to 
a CDSC of another Morgan Stanley Dean Witter Fund for shares of the Fund. When  
determining the length of time you held the shares and the corresponding CDSC   
rate, any period (starting at the end of the month) during which you held       
shares of the Fund will not be counted. Thus, in effect the "holding period"    
for purposes of calculating the CDSC is frozen upon exchanging into the Fund.   
Nevertheless, if shares subject to a CDSC are exchanged for shares of the Fund, 
you will receive a credit when you sell the shares equal to the distribution    
(12b-1) fees, if any, you paid on those shares while in the Fund up to the      
amount of any applicable CDSC. See the Prospectus of the Fund that charges the  
CDSC for more details.                                                          

TAX CONSIDERATIONS OF EXCHANGES. If you exchange shares of the Fund for shares  
of another Morgan Stanley Dean Witter Fund there are important tax              
considerations. For tax purposes, the exchange out of the Fund is considered a  
sale of Fund shares--and the exchange into the other Fund is considered a       
purchase. As a result, you may realize a capital gain or loss.                  

You should review the "Tax Consequences" section and consult your own tax       
professional about the tax consequences of an exchange.                         

FREQUENT EXCHANGES. A pattern of frequent exchanges may result in the Fund      
limiting or prohibiting, at its discretion, additional purchases and/or         
exchanges. The Fund will notify you in advance of limiting your exchange        
privileges.                                                                     

For further information regarding exchange privileges, you should contact your  
Morgan Stanley Dean Witter Financial Advisor or call (800) 869-NEWS.            

12                                                                              

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HOW TO SELL SHARES                                                              
------------------                                                              

You can sell some or all of your Fund shares at any time. Your shares will be   
sold at the next price calculated after we receive your order to sell as        
described below.                                                                

OPTIONS             PROCEDURES                                                  
--------------------------------------------------------------------------------
Contact Your        To sell your shares, simply call your Morgan Stanley Dean   
Financial Advisor   Witter Financial Advisor or other authorized financial      
representative.                         
                    ------------------------------------------------------------
                   Payment will be sent to the address to which the account is
          registered or deposited in your brokerage account.
--------------------------------------------------------------------------------
By Letter           You can also sell your shares by writing a "letter of       
instruction" that includes:             
o your account number;                  
               o the dollar amount or the number of shares you wish to
sell; and                           
                   o the signature of each owner as it appears on the account.
                    ------------------------------------------------------------
              If you are requesting payment to anyone other than the
                  registered owner(s) or that payment be sent to any address
            other than the address of the registered owner(s) or
              pre-designated bank account, you will need a signature
                 guarantee. You can generally obtain a signature guarantee
                    from an eligible guarantor acceptable to Morgan Stanley Dean
                 Witter Trust FSB. (You should contact Morgan Stanley Dean
                  Witter Trust FSB at (800) 869-NEWS for determination as to
                   whether a particular institution is an eligible guarantor.)
             A notary public cannot provide a signature guarantee.
                   Additional documentation may be required for shares held by
        a corporation, partnership, trustee or executor.
                    ------------------------------------------------------------
                  Mail the letter to Morgan Stanley Dean Witter Trust FSB at
                P.O. Box 983, Jersey City, New Jersey 07303. If you hold
                   share certificates, you must return the certificates, along
                  with the letter and any required additional documentation.
                    ------------------------------------------------------------
                  A check will be mailed to the name(s) and address in which
                 the account is registered, or otherwise according to your
instructions.                           
--------------------------------------------------------------------------------
Systematic          If your investment in all of the Morgan Stanley Dean Witter 
Withdrawal Plan     Family of Funds has a total market value of at least        
                  $10,000, you may elect to withdraw amounts of $25 or more,
                    or in any whole percentage of a Fund's balance (provided the
         amount is at least $25), on a monthly, quarterly,
                    semi-annual or annual basis, from any Fund with a balance of
                  at least $1,000. Each time you add a Fund to the plan, you
must meet the plan requirements.        
                    ------------------------------------------------------------
                   To sign up for the Systematic Withdrawal Plan, contact your
                  Morgan Stanley Dean Witter Financial Advisor or call (800)
               869-NEWS. You may terminate or suspend your plan at any
                time. Please remember that withdrawals from the plan are
                 sales of shares, not Fund "distributions," and ultimately
                   may exhaust your account balance. The Fund may terminate or
revise the plan at any time.            
--------------------------------------------------------------------------------

(sidebar)                                                                       
SYSTEMATIC WITHDRAWAL PLAN                                                      
This plan allows you to withdraw money automatically from your Fund account at  
regular intervals. Contact your Morgan Stanley Dean Witter Financial Advisor for
more details.                                                                   
(end sidebar)                                                                   

PAYMENT FOR SOLD SHARES. After we receive your complete instructions to sell as 
described above, a check will be mailed to you within seven days, although we   
will attempt to make payment within one business day. Payment may also be sent  
to your brokerage account.                                                      

Payment may be postponed or the right to sell your shares suspended under       
unusual circumstances. If you request to sell shares that were recently         
purchased by check, payment of the sale proceeds may be delayed for the minimum 
time needed to verify that the check has been honored (not more than fifteen    
days from the time we receive the check).                                       

INVOLUNTARY SALES. The Fund reserves the right, on sixty days' notice, to sell  
the shares of any shareholder (other than shares held in an IRA or 403(b)       
Custodial Account)                                                              

                                                                              13

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whose shares, due to sales by the shareholder, have a value below $100, or in   
the case of an account opened through EasyInvest(SM), if after 12 months the    
shareholder has invested less than $1,000 in the account.                       

However, before the Fund sells your shares in this manner, we will notify you   
and allow you sixty days to make an additional investment in an amount that     
will increase the value of your account to at least the required amount before  
the sale is processed.                                                          

MARGIN ACCOUNTS. Certain restrictions may apply to Fund shares pledged in       
margin accounts with Dean Witter Reynolds or another authorized broker-dealer   
of Fund shares. If you hold Fund shares in this manner, please contact your     
Morgan Stanley Dean Witter Financial Advisor or other authorized financial      
representative for more details. System                                         

DISTRIBUTIONS                                                                   
-------------                                                                   

(sidebar)                                                                       
TARGETED DIVIDENDS(SM)                                                          
You may select to have your Fund distributions automatically invested in        
another Morgan Stanley Dean Witter Fund that you own. Contact your Morgan       
Stanley Dean Witter Financial Advisor for further information about this        
service.                                                                        
(end sidebar)                                                                   

The Fund passes substantially all of its earnings from income and capital gains 
along to its investors as "distributions." The Fund earns interest from         
fixed-income investments. These amounts are passed along to Fund shareholders as
"income dividend distributions." The Fund realizes capital gains whenever it    
sells securities for a higher price than it paid for them. These amounts are    
passed along as "capital gain distributions."                                   

Normally, income dividends are distributed to shareholders monthly. Any capital 
gains are distributed in December; if a second capital gain distribution is     
necessary, it is paid in the following year. The Fund, however, may retain and  
reinvest any long-term capital gains. The Fund may at times make payments from  
sources other than income or capital gains that represent a return of a portion 
of your investment.                                                             

Distributions are reinvested automatically in additional shares of the Fund and 
automatically credited to your account, unless you request in writing that all  
distributions be paid in cash. If you elect the cash option, the Fund will mail 
a check to you no later than seven business days after the distribution is      
declared. No interest will accrue on uncashed checks. If you wish to change how 
your distributions are paid, your request should be received by the Fund's      
transfer agent, Morgan Stanley Dean Witter Trust FSB, at least five business    
days prior to the record date of the distributions.                             

TAX CONSEQUENCES                                                                
----------------                                                                

As with any investment, you should consider how your Fund investment will be    
taxed. The tax information in this Prospectus is provided as general            
information. You should consult your own tax professional about the tax         
consequences of an investment in the Fund.                                      

Unless your investment in the Fund is through a tax-deferred retirement         
account, such as a 401(k) plan or IRA, you need to be aware of the possible tax 
consequences when:                                                              

o The Fund makes distributions; and                                             

o You sell Fund shares, including an exchange to another Morgan Stanley Dean    
Witter Fund.                                                                

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TAXES ON DISTRIBUTIONS. Your distributions are normally subject to federal and  
state income tax when they are paid, whether you take them in cash or reinvest  
them in Fund shares. A distribution also may be subject to local income tax.    
Any income dividend distributions and any short-term capital gain distributions 
are taxable to you as ordinary income. Any long-term capital gain distributions 
are taxable as long-term capital gains, no matter how long you have owned       
shares in the Fund.                                                             

Every January, you will be sent a statement (IRS Form 1099-DIV) showing the     
taxable distributions paid to you in the previous year. The statement provides  
full information on your dividends and capital gains for tax purposes.          

TAXES ON SALES. Your sale of Fund shares normally is subject to federal and     
state income tax and may result in a taxable gain or loss to you. A sale also   
may be subject to local income tax. Your exchange of Fund shares for shares of  
another Morgan Stanley Dean Witter Fund is treated for tax purposes like a sale 
of your original shares and a purchase of your new shares. Thus, the exchange   
may, like a sale, result in a taxable gain or loss to you and will give you a   
new tax basis for your new shares.                                              

When you open your Fund account, you should provide your social security or tax 
identification number on your investment application. By providing this         
information, you will avoid being subject to a federal backup withholding tax   
of 31% on taxable distributions and redemption proceeds. Any withheld amount    
would be sent to the IRS as an advance tax payment.                             

                                                                              15

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FINANCIAL HIGHLIGHTS                                                            

The financial highlights table is intended to help you understand the Fund's    
financial performance for the past 5 fiscal years of the Fund. Certain          
information reflects financial results for a single Fund share throughout each  
year. The total returns in the table represent the rate an investor would have  
earned or lost on an investment in the Fund (assuming reinvestment of all       
dividends and distributions).                                                   

This information has been audited by                    , whose report, along   
with the Fund's financial statements, is included in the annual report, which   
is available upon request.                                                      

CLASS B SHARES                                                                  
-------------------------------------------------   
[TO COME] 

16                                                                              

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NOTES                                                                           

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                                                                              17

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NOTES                                                                           

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18                                                                              

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NOTES                                                                           

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MORGAN STANLEY DEAN WITTER                                                      
FAMILY OF FUNDS                                                                 

The Morgan Stanley Dean Witter Family of Funds offers investors a wide range of 
investment choices. Come on in and meet the family!                             

                                                        [Enlarge/Download Table]

----------------------------------------------------------------------------------------------------------------
                                                                                                                
GROWTH FUNDS            GROWTH FUNDS                             Information Fund                               
                                                                 Natural Resource Development Securities        
                        Aggressive Equity Fund                   Precious Metals and Minerals Trust             
                        American Opportunities Fund              Real Estate Fund                               
                        Capital Growth Securities                                                               
                        Developing Growth Securities             GLOBAL/INTERNATIONAL FUNDS                     
                        Equity Fund                                                                             
                        Growth Fund                              Competitive Edge Fund - "Best Ideas" Portfolio 
                        Market Leader Trust                      European Growth Fund                           
                        Mid-Cap Growth Fund                      Fund of Funds - International Portfolio        
                        Special Value Fund                       Global Dividend Growth Securities              
                        Value Fund                               International SmallCap Fund                    
                                                                 Japan Fund                                     
                        THEME FUNDS                              Pacific Growth Fund                            

                        Financial Services Trust                                                                
                        Health Sciences Trust                                                                   
----------------------------------------------------------------------------------------------------------------
GROWTH & INCOME FUNDS   Balanced Growth Fund                     S&P 500 Index Fund                             
                        Balanced Income Fund                     S&P 500 Select Fund                            
                        Convertible Securities Trust             Strategist Fund                                
                        Dividend Growth Securities               Value/Added Market Series/Equity Portfolio     
                        Fund of Funds - Domestic Portfolio                                                      
                        Income Builder Fund                      THEME FUNDS                                    
                        Mid-Cap Dividend Growth Securities                                                      
                                                                 Global Utilities Fund                          
                                                                 Utilities Fund                                 
----------------------------------------------------------------------------------------------------------------
INCOME FUNDS            GOVERNMENT INCOME FUNDS                  GLOBAL INCOME FUNDS                            

                        Federal Securities Trust                 World Wide Income Trust                        
                        Short-Term U.S. Treasury Trust                                                          
                        U.S. Government Securities Trust         TAX-FREE INCOME FUNDS                          

                        DIVERSIFIED INCOME FUNDS                 California Tax-Free Income Fund                
                                                                 Hawaii Municipal Trust(FSC)                    
                        Diversified Income Trust                 Limited Term Municipal Trust(NL)               
                                                                 Multi-State Municipal Series Trust(FSC)        
                        CORPORATE INCOME FUNDS                   New York Tax-Free Income Fund                  
                                                                 Tax-Exempt Securities Trust                    
                        High Yield Securities                                                                   
                        Intermediate Income Securities                                                          
                        Short-Term Bond Fund(NL)                                                                
----------------------------------------------------------------------------------------------------------------
MONEY MARKET FUNDS      TAXABLE MONEY MARKET FUNDS               TAX-FREE MONEY MARKET FUNDS                    

                        Liquid Asset Fund(MM)                    California Tax-Free Daily Income Trust(MM)     
                        U.S. Government Money Market Trust(MM)   New York Municipal Money Market Trust(MM)      
                                                                 Tax-Free Daily Income Trust(MM)                

There may be Funds created after this Prospectus was published. Please consult  
the inside front cover of a new Fund's prospectus for its designations, e.g.,   
Multi-Class Fund or Money Market Fund.                                          

Unless otherwise noted, each listed Morgan Stanley Dean Witter Fund, except for 
Short-Term U.S. Treasury Trust, is a Multi-Class Fund. A Multi-Class Fund is a  
mutual fund offering multiple Classes of shares. The other types of Funds are:  
NL -- No-Load (Mutual) Fund; MM -- Money Market Fund; FSC -- A mutual fund sold 
with a front-end sales charge and a distribution (12b-1) fee.                   

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MORGAN STANLEY DEAN WITTER NORTH AMERICAN GOVERNMENT INCOME TRUST               

Additional information about the Fund's investments is available in the Fund's  
Annual and Semi-Annual Reports to Shareholders. In the Fund's Annual Report,    
you will find a discussion of the market conditions and investment strategies   
that significantly affected the Fund's performance during its last fiscal year. 
The Fund's Statement of Additional Information also provides additional         
information about the Fund. The Statement of Additional Information is          
incorporated herein by reference (legally is part of this Prospectus). For a    
free copy of any of these documents to request other information about the      
Fund, or to make shareholder inquiries, please call:                            

(800) 869-NEWS

You also may obtain information about the Fund by calling your Morgan Stanley   
Dean Witter Financial Advisor or by visiting our Internet site at:              

TICKER SYMBOLS:                                                                 

Class A:                                                                      
------------------                                                              
Class B:                                                                      
------------------                                                              
Class C:                                                                      
------------------                                                              
Class D:                                                                      
------------------                                                              

WWW.DEANWITTER.COM/FUNDS

Information about the Fund (including the Statement of Additional Information)  
can be viewed and copied at the Securities and Exchange Commission's Public     
Reference Room in Washington, DC. Information about the Reference Room's        
operations may be obtained by calling the SEC at (800) SEC-0330. Reports and    
other information about the Fund are available on the SEC's Internet site       
(www.sec.gov) and copies of this information may be obtained, upon payment of a 
duplicating fee, by writing the Public Reference Section of the SEC,            
Washington, DC 20549-6009.                                                      

(INVESTMENT COMPANY ACT FILE NO. 811-6572)                                      

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STATEMENT OF ADDITIONAL INFORMATION                                             
                                                                MORGAN STANLEY
JUNE 25, 1999                                                    DEAN WITTER    
                                                                NORTH AMERICAN
                                                            GOVERNMENT
                                                              INCOME TRUST
--------------------------------------------------------------------------------

This Statement of Additional Information is not a Prospectus. The     
Prospectus (dated June 25, 1999) for Morgan Stanley Dean Witter North American  
Government Income Trust may be obtained without charge from the Fund at its     
address or telephone number listed below or from Dean Witter Reynolds at any of 
its branch offices.                                                             

Morgan Stanley Dean Witter North American Government Income Trust               
Two World Trade Center                                                          
New York, New York 10048                                                        
(800) 869-NEWS                                                                  

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TABLE OF CONTENTS                                                               
--------------------------------------------------------------------------------

I.    Fund History ..........................................................  4
II.   Description of the Fund and Its Investments and Risks .................  4
      A. Classification .....................................................  4
      B. Investment Strategies and Risks ....................................  4
      C. Fund Policies/Investment Restrictions .............................. 13
III.  Management of the Fund ................................................ 14
      A. Board of Trustees .................................................. 14
      B. Management Information ............................................. 14
      C. Compensation ....................................................... 19
IV.   Control Persons and Principal Holders of Securities ................... 21
V.    Management, Investment Advice and Other Services ...................... 21
      A. The Investment Manager and Sub-Advisor ............................. 21
      B. Principal Underwriter .............................................. 22
C. Services Provided by the Investment Manager, the Sub-Advisor     
         and Fund Expenses Paid by Third Parties ............................ 23
      D. Rule 12b-1 Plan .................................................... 24
      E. Other Service Providers ............................................ 25
VI.   Brokerage Allocation and Other Practices .............................. 26
      A. Brokerage Transactions ............................................. 26
      B. Commissions ........................................................ 26
      C. Brokerage Selection ................................................ 26
      D. Directed Brokerage ................................................. 27
      E. Regular Broker-Dealers ............................................. 27
VII.  Capital Stock and Other Securities .................................... 27
VIII. Purchase, Redemption and Pricing of Shares ............................ 28
      A. Purchase/Redemption of Shares ...................................... 28
      B. Offering Price ..................................................... 28
IX.   Taxation of the Fund and Shareholders ................................. 29
X.    Underwriters .......................................................... 30
XI.   Calculation of Performance Data ....................................... 30
XII.  Financial Statements .................................................. 31

2 

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GLOSSARY OF SELECTED DEFINED TERMS  

  The terms defined in this glossary are frequently used in this Statement
of Additional Information (other terms used occasionally are defined in the     
text of the document).                                                          

"Custodian " -- The Bank of New York.                                 

"Dean Witter Reynolds " -- Dean Witter Reynolds Inc., a wholly-owned  
broker-dealer subsidiary of MSDW.                                               

"Distributor " -- Morgan Stanley Dean Witter Distributors Inc., a     
wholly-owned broker-dealer subsidiary of MSDW.                                  

  "Financial Advisors " -- Morgan Stanley Dean Witter authorized financial
services representatives.                                                       

"Fund " -- Morgan Stanley Dean Witter North American Government Income
Trust, a registered open-end investment company.                                

"Investment Manager " -- Morgan Stanley Dean Witter Advisors Inc., a  
wholly-owned investment advisor subsidiary of MSDW.                             

  "Independent Trustees " -- Trustees who are not "interested persons" (as
defined by the Investment Company Act) of the Fund.                             

"Morgan Stanley & Co." -- Morgan Stanley & Co. Incorporated, a        
wholly-owned broker-dealer subsidiary of MSDW.                                  

    "Morgan Stanley Dean Witter Funds " -- Registered investment companies (i)
for which the Investment Manager serves as the investment advisor; and (ii)     
that hold themselves out to investors as related companies for investment and   
investor services.                                                              

    "MSDW " -- Morgan Stanley Dean Witter & Co., a preeminent global financial
services firm.                                                                  

"MSDW Services Company " -- Morgan Stanley Dean Witter Services Company   
Inc., a wholly-owned fund services subsidiary of the Investment Manager.        

    "Sub-Advisor " -- TCW Funds Management, Inc., a wholly-owned subsidiary of
TCW.                                                                            

"TCW " -- The TCW Group, Inc., a preeminent investment management and 
investment advisory services firm.                                              

   "Transfer Agent " -- Morgan Stanley Dean Witter Trust FSB, a wholly-owned
transfer agent subsidiary of MSDW.                                              

"Trustees " -- The Board of Trustees of the Fund.                     

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I. FUND HISTORY                                                                 
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    The Fund was organized under the laws of the Commonwealth of Massachusetts
on February 19, 1992 as a Massachusetts business trust under the name "TCW/DW   
North American Government Income Trust." On February 25, 1999 the Fund's        
Trustees adopted an Amendment to the Fund's Declaration of Trust changing the   
name of the Fund to Morgan Stanley Dean Witter North American Government Income 
Trust.                                                                          

II. DESCRIPTION OF THE FUND AND ITS INVESTMENTS AND RISKS                       
--------------------------------------------------------------------------------

A. CLASSIFICATION                                                               

The Fund is an open-end, non-diversified management investment company
whose investment objective is to earn a high level of current income while      
maintaining relatively low volatility of principal.                             

B. INVESTMENT STRATEGIES AND RISKS                                              

The following discussion of the Fund's investment strategies and risks
should be read with the sections of the Fund's Prospectus titled "Principal     
Investment Strategies," "Principal Risks," "Additional Investment Strategy      
Information" and "Additional Risk Information."                                 

FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS. The Fund may enter into  
forward foreign currency exchange contracts ("forward contracts") to facilitate 
settlement or in an attempt to limit the effect of changes in the relationship  
between the U.S. dollar and the foreign currency during the period between the  
date on which the security is purchased or sold and the date on which payment   
is made or received. In addition, the Fund may enter into forward contracts as  
a hedge against fluctuations in future foreign exchange rates. The Fund may     
conduct its foreign currency exchange transactions either on a spot (i.e.,      
cash) basis at the spot rate prevailing in the foreign currency exchange        
market, or through entering into forward contracts to purchase or sell foreign  
currencies. A forward contract involves an obligation to purchase or sell a     
specific currency at a future date, which may be any fixed number of days from  
the date of the contract agreed upon by the parties, at a price set at the time 
of the contract. These contracts are traded in the interbank market conducted   
directly between currency traders (usually large commercial and investment      
banks) and their customers. Forward contracts will only be entered into with    
United States banks and their foreign branches, insurance companies or other    
dealers or foreign banks whose assets total $1 billion or more. A forward       
contract generally has no deposit requirement, and no commissions are charged   
at any stage for trades.                                                        

  The Fund also may from time to time utilize forward contracts to hedge a
foreign security held in the portfolio or a security which pays out principal   
tied to an exchange rate between the U.S. dollar and a foreign currency,        
against a decline in value of the applicable foreign currency. They also may be 
used to lock in the current exchange rate of the currency in which those        
securities anticipated to be purchased are denominated. At times, the Fund may  
enter into "cross-currency" hedging transactions involving currencies other     
than those in which securities are held or proposed to be purchased are         
denominated.                                                                    

   The Fund will not enter into forward currency contracts or maintain a net
exposure to these contracts where the consummation of the contracts would       
obligate the Fund to deliver an amount of foreign currency in excess of the     
value of the Fund's portfolio securities.                                       

Although the Fund values its assets daily in terms of U.S. dollars, it
does not intend to convert its holdings of foreign currencies into U.S. dollars 
on a daily basis. It will, however, do so from time to time, and investors      
should be aware of the costs of currency conversion. Although foreign exchange  
dealers do not charge a fee for conversion, they do realize a profit based on   
the spread between the prices at which they are buying and selling various      
currencies. Thus, a dealer may offer to sell a foreign currency to the Fund at  
one rate, while offering a lesser rate of exchange should the Fund desire to    
resell that currency to the dealer.                                             

   The Fund may be limited in its ability to enter into hedging transactions
involving forward contracts by the Internal Revenue Code requirements relating  
to qualification as a regulated investment company.                             

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Forward contracts may limit gains on portfolio securities that could  
otherwise be realized had they not been utilized and could result in losses.    
The contracts also may increase the Fund's volatility and may involve a         
significant amount of risk relative to the investment of cash.                  

 OPTION AND FUTURES TRANSACTIONS. The Fund may engage in transactions in
listed and OTC options. Listed options are issued or guaranteed by the exchange 
on which they are traded or by a clearing corporation such as the Options       
Clearing Corporation ("OCC"). Ownership of a listed call option gives the Fund  
the right to buy from the OCC (in the U.S.) or other clearing corporation or    
exchange, the underlying security or currency covered by the option at the      
stated exercise price (the price per unit of the underlying security) by filing 
an exercise notice prior to the expiration date of the option. The writer       
(seller) of the option would then have the obligation to sell to the OCC (in    
the U.S.) or other clearing corporation or exchange, the underlying security or 
currency at that exercise price prior to the expiration date of the option,     
regardless of its then current market price. Ownership of a listed put option   
would give the Fund the right to sell the underlying security or currency to    
the OCC (in the U.S.) or other clearing corporation or exchange, at the stated  
exercise price. Upon notice of exercise of the put option, the writer of the    
put would have the obligation to purchase the underlying security or currency   
from the OCC (in the U.S.) or other clearing corporation or exchange, at the    
exercise price.                                                                 

   COVERED CALL WRITING. The Fund is permitted to write covered call options
on portfolio securities, without limit, and may also write covered call options 
on the U.S. dollar and foreign currencies in which its portfolio securities are 
denominated, without limit.                                                     

The Fund will receive from the purchaser, in return for a call it has 
written, a "premium;" i.e., the price of the option. Receipt of these premiums  
may better enable the Fund to earn a higher level of current income than it     
would earn from holding the underlying securities (or currencies) alone.        
Moreover, the premium received will offset a portion of the potential loss      
incurred by the Fund if the securities (or currencies) underlying the option    
decline in value.                                                               

    The Fund may be required, at any time during the option period, to deliver
the underlying security (or currency) against payment of the exercise price on  
any calls it has written. This obligation is terminated upon the expiration of  
the option period or at such earlier time when the writer effects a closing     
purchase transaction. A closing purchase transaction is accomplished by         
purchasing an option of the same series as the option previously written.       
However, once the Fund has been assigned an exercise notice, the Fund will be   
unable to effect a closing purchase transaction.                                

Options written by the Fund normally have expiration dates of up to   
eighteen months from the date written. The exercise price of a call option may  
be below, equal to or above the current market value of the underlying security 
at the time the option is written.                                              

COVERED PUT WRITING. The Fund may engage in covered put writing. As a 
writer of a covered put option, the Fund incurs an obligation to buy the        
security underlying the option from the purchaser of the put, at the option's   
exercise price at any time during the option period, at the purchaser's         
election. Through the writing of a put option, the Fund would receive income    
from the premium paid by purchasers. The potential gain on a covered put option 
is limited to the premium received on the option (less the commissions paid on  
the transaction). At any time during the option period, the Fund may be         
required to make payment of the exercise price against delivery of the          
underlying security (or currency). The aggregate value of the obligations       
underlying puts may not exceed 50% of the Fund's net assets.                    

    PURCHASING CALL AND PUT OPTIONS. The Fund may purchase listed and OTC call
and put options in amounts equaling up to 5% of its total assets. The purchase  
of a call option would enable the Fund, in return for the premium paid, to lock 
in a purchase price for a security or currency during the term of the option.   
The purchase of a put option would enable the Fund, in return for a premium     
paid, to lock in a price at which it may sell a security or currency during the 
term of the option.                                                             

   OPTIONS ON FOREIGN CURRENCIES. The Fund may purchase and write options on
foreign currencies for purposes similar to those involved with investing in     
forward foreign currency exchange contracts.                                    

  OTC OPTIONS. OTC options are purchased from or sold (written) to dealers
or financial institutions which have entered into direct agreements with the    
Fund. With OTC options, such variables as expiration                            

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date, exercise price and premium will be agreed upon between the Fund and the   
transacting dealer, without the intermediation of a third party such as the     
OCC. The Fund may engage in OTC option transactions only with member banks of   
the Federal Reserve Bank System or primary dealers in U.S. Government           
securities or with affiliates of such banks or dealers.                         

 RISKS OF OPTIONS TRANSACTIONS. The successful use of options depends on
the ability of the Investment Manager or the Sub-Advisor, to forecast correctly 
interest rates, currency exchange rates and/or market movements. If the market  
value of the portfolio securities (or the currencies in which they are          
denominated) upon which call options have been written increases, the Fund may  
receive a lower total return from the portion of its portfolio upon which calls 
have been written than it would have had such calls not been written. During    
the option period, the covered call writer has, in return for the premium on    
the option, given up the opportunity for capital appreciation above the         
exercise price should the market price of the underlying security (or the value 
of its denominated currency) increase, but has retained the risk of loss should 
the price of the underlying security (or the value of its denominated currency) 
decline. The covered put writer also retains the risk of loss should the market 
value of the underlying security decline below the exercise price of the option 
less the premium received on the sale of the option. In both cases, the writer  
has no control over the time when it may be required to fulfill its obligation  
as a writer of the option. Prior to exercise or expiration, an option position  
can only be terminated by entering into a closing purchase or sale transaction. 
Once an option writer has received an exercise notice, it cannot effect a       
closing purchase transaction in order to terminate its obligation under the     
option and must deliver or receive the underlying securities at the exercise    
price.                                                                          

  The Fund's ability to close out its position as a writer of an option is
dependent upon the existence of a liquid secondary market on option exchanges.  
There is no assurance that such a market will exist, particularly in the case   
of OTC options.                                                                 

   In the event of the bankruptcy of a broker through which the Fund engages
in transactions in options, the Fund could experience delays and/or losses in   
liquidating open positions purchased or sold through the broker and/or incur a  
loss of all or part of its margin deposits with the broker. In the case of OTC  
options, if the transacting dealer fails to make or take delivery of the        
securities underlying an option it has written, in accordance with the terms of 
that option, due to insolvency or otherwise, the Fund would lose the premium    
paid for the option as well as any anticipated benefit of the transaction.      

 Each of the exchanges has established limitations governing the maximum
number of call or put options on the same underlying security which may be      
written by a single investor, whether acting alone or in concert with others    
(regardless of whether such options are written on the same or different        
exchanges or are held or written on one or more accounts or through one or more 
brokers). An exchange may order the liquidation of positions found to be in     
violation of these limits and it may impose other sanctions or restrictions.    
These position limits may restrict the number of listed options which the Fund  
may write.                                                                      

    The hours of trading for options may not conform to the hours during which
the underlying securities are traded. To the extent that the option markets     
close before the markets for the underlying securities, significant price and   
rate movements can take place in the underlying markets that cannot be          
reflected in the option markets.                                                

   The markets in foreign currency options are relatively new and the Fund's
ability to establish and close out positions on such options is subject to the  
maintenance of a liquid secondary market. There can be no assurance that a      
liquid secondary market will exist for a particular option at any specific      
time.                                                                           

The value of a foreign currency option depends upon the value of the  
underlying currency relative to the U.S. dollar. As a result, the price of the  
option position may vary with changes in the value of either or both currencies 
and have no relationship to the investment merits of a foreign security.        
Because foreign currency transactions occurring in the interbank market involve 
substantially larger amounts than those that may be involved in the use of      
foreign currency options, investors may be disadvantaged by having to deal in   
an odd lot market (generally consisting of transactions of less than $1         
million) for the underlying foreign currencies at prices that are less          
favorable than for round lots.                                                  

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There is no systematic reporting of last sale information for foreign 
currencies or any regulatory requirement that quotations available through      
dealers or other market sources be firm or revised on a timely basis. Quotation 
information available is generally representative of very large transactions in 
the interbank market and thus may not reflect relatively smaller transactions   
(i.e., less than $1 million) where rates may be less favorable. The interbank   
market in foreign currencies is a global, around-the-clock market. To the       
extent that the U.S. options markets are closed while the markets for the       
underlying currencies remain open, significant price and rate movements may     
take place in the underlying markets that are not reflected in the options      
market.                                                                         

   FUTURES CONTRACTS. The Fund may purchase and sell interest rate and index
futures contracts that are traded on U.S. commodity exchanges on such           
underlying securities as U.S. Treasury bonds, notes, bills,GNMA Certificates    
and on any foreign government fixed-income security and on various currencies,  
and on such indexes of U.S. securities (and, if applicable, foreign securities) 
as may exist or come into existence.                                            

 A futures contract purchaser incurs an obligation to take delivery of a
specified amount of the obligation underlying the contract at a specified time  
in the future for a specified price. A seller of a futures contract incurs an   
obligation to deliver the specified amount of the underlying obligation at a    
specified time in return for an agreed upon price. The purchase of a futures    
contract enables the Fund, during the term of the contract, to lock in a price  
at which it may purchase a security or currency and protect against a rise in   
prices pending purchase of portfolio securities. The sale of a futures contract 
enables the Fund to lock in a price at which it may sell a security or currency 
and protect against declines in the value of portfolio securities.              

   Although most futures contracts call for actual delivery or acceptance of
securities, the contracts usually are closed out before the settlement date     
without the making or taking of delivery. Index futures contracts provide for   
the delivery of an amount of cash equal to a specified dollar amount times the  
difference between the index value at the open or close of the last trading day 
of the contract and the futures contract price. A futures contract sale is      
closed out by effecting a futures contract purchase for the same aggregate      
amount of the specific type of security (currency) and the same delivery date.  
If the sale price exceeds the offsetting purchase price, the seller would be    
paid the difference and would realize a gain. If the offsetting purchase price  
exceeds the sale price, the seller would pay the difference and would realize a 
loss. Similarly, a futures contract purchase is closed out by effecting a       
futures contract sale for the same aggregate amount of the specific type of     
security (currency) and the same delivery date. If the offsetting sale price    
exceeds the purchase price, the purchaser would realize a gain, whereas if the  
purchase price exceeds the offsetting sale price, the purchaser would realize a 
loss. There is no assurance that the Fund will be able to enter into a closing  
transaction.                                                                    

MARGIN. If the Fund enters into a futures contract, it is initially   
required to deposit an "initial margin" of cash or U.S. Government securities   
or other liquid portfolio securities ranging from approximately 2% to 5% of the 
contract amount. Initial margin requirements are established by the exchanges   
on which futures contracts trade and may, from time to time, change. In         
addition, brokers may establish margin deposit requirements in excess of those  
required by the exchanges.                                                      

Initial margin in futures transactions is different from margin in    
securities transactions in that initial margin does not involve the borrowing   
of funds by a broker's client but is, rather, a good faith deposit on the       
futures contract which will be returned to the Fund upon the proper termination 
of the futures contract. The margin deposits made are marked to market daily    
and the Fund may be required to make subsequent deposits of cash or U.S.        
Government securities, called "variation margin," which are reflective of price 
fluctuations in the futures contract.                                           

    OPTIONS ON FUTURES CONTRACTS. The Fund may purchase and write call and put
options on futures contracts and enter into closing transactions with respect   
to such options to terminate an existing position. An option on a futures       
contract gives the purchaser the right (in return for the premium paid), and    
the writer the obligation, to assume a position in a futures contract (a long   
position if the option is a call and a short position if the option is a put)   
at a specified exercise price at any time during the term of the option. Upon   
exercise of the option, the delivery of the futures position by the writer of   
the option                                                                      

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to the holder of the option is accompanied by delivery of the accumulated       
balance in the writer's futures margin account, which represents the amount by  
which the market price of the futures contract at the time of exercise exceeds, 
in the case of a call, or is less than, in the case of a put, the exercise      
price of the option on the futures contract.                                    

The writer of an option on a futures contract is required to deposit  
initial and variation margin pursuant to requirements similar to those          
applicable to futures contracts. Premiums received from the writing of an       
option on a futures contract are included in initial margin deposits.           

   LIMITATIONS ON FUTURES CONTRACTS AND OPTIONS ON FUTURES. The Fund may not
enter into futures contracts or purchase related options thereon if,            
immediately thereafter, the amount committed to margin plus the amount paid for 
premiums for unexpired options on futures contracts exceeds 5% of the value of  
the Fund's total assets, after taking into account unrealized gains and         
unrealized losses on such contracts into which it has entered; provided,        
however, that in the case of an option that is in-the-money (the exercise price 
of the call (put) option is less (more) than the market price of the underlying 
security) at the time of purchase, the in-the-money amount may be excluded in   
calculating the 5%. However, there is no overall limitation on the percentage   
of the Fund's net assets which may be subject to a hedge position.              

    RISKS OF TRANSACTIONS IN FUTURES CONTRACTS AND RELATED OPTIONS. The prices
of securities and indexes subject to futures contracts (and thereby the futures 
contract prices) may correlate imperfectly with the behavior of the cash prices 
of the Fund's securities (and the currencies in which they are denominated).    
Also, prices of futures contracts may not move in tandem with the changes in    
prevailing interest rates, market movements and/or currency exchange rates      
against which the Fund seeks a hedge. A correlation may also be distorted (a)   
temporarily, by short-term traders seeking to profit from the difference        
between a contract or security price objective and their cost of borrowed       
funds; (b) by investors in futures contracts electing to close out their        
contracts through offsetting transactions rather than meet margin deposit       
requirements; (c) by investors in futures contracts opting to make or take      
delivery of underlying securities rather than engage in closing transactions,   
thereby reducing liquidity of the futures market; and (d) temporarily, by       
speculators who view the deposit requirements in the futures markets as less    
onerous than margin requirements in the cash market. Due to the possibility of  
price distortion in the futures market and because of the possible imperfect    
correlation between movements in the prices of securities and movements in the  
prices of futures contracts, a correct forecast of interest rate, currency      
exchange rate and/or market movement trends by the Investment Manager and/or    
the Sub-Advisor may still not result in a successful hedging transaction.       

There is no assurance that a liquid secondary market will exist for   
futures contracts and related options in which the Fund may invest. In the      
event a liquid market does not exist, it may not be possible to close out a     
futures position and, in the event of adverse price movements, the Fund would   
continue to be required to make daily cash payments of variation margin. In     
addition, limitations imposed by an exchange or board of trade on which futures 
contracts are traded may compel or prevent the Fund from closing out a contract 
which may result in reduced gain or increased loss to the Fund. The absence of  
a liquid market in futures contracts might cause the Fund to make or take       
delivery of the underlying securities (currencies) at a time when it may be     
disadvantageous to do so.                                                       

 Exchanges limit the amount by which the price of a futures contract may
move on any day. If the price moves equal the daily limit on successive days,   
then it may prove impossible to liquidate a futures position until the daily    
limit moves have ceased. In the event of adverse price movements, the Fund      
would continue to be required to make daily cash payments of variation margin   
on open futures positions. In these situations, if the Fund has insufficient    
cash, it may have to sell portfolio securities to meet daily variation margin   
requirements at a time when it may be disadvantageous to do so. In addition,    
the Fund may be required to take or make delivery of the instruments underlying 
interest rate futures contracts it holds at a time when it is disadvantageous   
to do so. The inability to close out options and futures positions could also   
have an adverse impact on the Fund's ability to effectively hedge its           
portfolio.                                                                      

Futures contracts and options thereon which are purchased or sold on  
foreign commodities exchanges may have greater price volatility than their U.S. 
counterparts. Furthermore, foreign                                              

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commodities exchanges may be less regulated and under less governmental         
scrutiny than U.S. exchanges. Brokerage commissions, clearing costs and other   
transaction costs may be higher on foreign exchanges. Greater margin            
requirements may limit the Fund's ability to enter into certain commodity       
transactions on foreign exchanges. Moreover, differences in clearance and       
delivery requirements on foreign exchanges may occasion delays in the           
settlement of the Fund's transactions effected on foreign exchanges.            

   In the event of the bankruptcy of a broker through which the Fund engages
in transactions in futures or options thereon, the Fund could experience delays 
and/or losses in liquidating open positions purchased or sold through the       
broker and/or incur a loss of all or part of its margin deposits with the       
broker.                                                                         

COLLATERALIZED MORTGAGE OBLIGATIONS. The Fund may invest in CMOs -    
collateralized mortgage obligations. CMOs are debt obligations collateralized   
by mortgage loans or mortgage pass-through securities (collectively "Mortgage   
Assets"). Payments of principal and interest on the Mortgage Assets and any     
reinvestment income are used to make payments on the CMOs. CMOs are issued in   
multiple classes. Each class has a specific fixed or floating coupon rate and a 
stated maturity or final distribution date. The principal and interest on the   
Mortgage Assets may be allocated among the classes in a number of different     
ways. Certain classes will, as a result of the collection, have more            
predictable cash flows than others. As a general matter, the more predictable   
the cash flow, the lower the yield relative to other Mortgage Assets. The less  
predictable the cash flow, the higher the yield and the greater the risk. The   
Fund may invest in any class of CMO.                                            

Certain mortgage-backed securities in which the Fund may invest       
(e.g.,certain classes of CMOs) may increase or decrease in value substantially  
with changes in interest rates and/or the rates of prepayment. In addition, if  
the collateral securing CMOs or any third party guarantees are insufficient to  
make payments, the Fund could sustain a loss.                                   

  In addition, the Fund may invest in stripped mortgage-backed securities,
which are usually structured in two classes. One class entitles the holder to   
receive all or most of the interest but little or none of the principal of a    
pool of Mortgage Assets (the interest-only or "IO Class"), while the other      
class entitles the holder to receive all or most of the principal but little or 
none of the interest (the principal-only or "PO" Class). IOs tend to decrease   
in value substantially if interest rates decline and prepayment rates become    
more rapid. POs tend to decrease in value substantially if interest rates       
increase and the rate of repayment decreases.                                   

The Fund may invest up to 10% of its assets in inverse floaters. An   
inverse floater has a coupon rate that moves in the direction opposite to that  
of a designated interest rate index. Like most other fixed income securities,   
the value of inverse floaters will decrease as interest rates increase. They    
are more volatile, however, than most other fixed income securities because the 
coupon rate on an inverse floater typically changes at a multiple of the change 
in the relevant index rate. Thus, any rise in the index rate (as a consequence  
of an increase in interest rates) causes a correspondingly greater drop in the  
coupon rate of an inverse floater while a drop in the index rate causes a       
correspondingly greater increase in the coupon of an inverse floater. Some      
inverse floaters may also increase or decrease substantially because of changes 
in the rate of prepayments.                                                     

  ASSET-BACKED SECURITIES. The Fund may invest in Asset-Backed Securities.
Asset-Backed Securities represent the securitization techniques used to develop 
mortgage-backed securities are also applied to a broad range of other assets.   
Various types of assets, primarily automobile and credit card receivables and   
home equity loans, are being securitized in pass-through structures similar to  
the mortgage pass-through structures. These types of securities are known as    
asset-backed securities. The Fund may invest in any type of asset-backed        
security.                                                                       

Asset-backed securities have risk characteristics similar to          
mortgage-backed securities. Like mortgage-backed securities, they generally     
decrease in value as a result of interest rate increases, but may benefit less  
than other fixed-income securities from declining interest rates, principally   
because of prepayments. Also, as in the case of mortgage-backed securities,     
prepayments generally increase                                                  

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during a period of declining interest rates although other factors, such as     
changes in credit use and payment patterns, may also influence prepayment       
rates. Asset-backed securities also involve the risk that various federal and   
state consumer laws and other legal and economic factors may result in the      
collateral backing the securities being insufficient to support payment on the  
securities.                                                                     

MONEY MARKET SECURITIES. The Fund may invest in various money market  
securities for cash management purposes or when assuming a temporary defensive  
position, which among others may include commercial paper, bank acceptances,    
bank obligations, corporate debt securities, certificates of deposit, U.S.      
Government securities and obligations of savings institutions and repurchase    
agreements. Such securities are limited to:                                     

U.S. Government Securities. Obligations issued or guaranteed as to    
principal and interest by the United States or its agencies (such as the        
Export-Import Bank of the United States, Federal Housing Administration and     
Government National Mortgage Association) or its instrumentalities (such as the 
Federal Home Loan Bank), including Treasury bills, notes and bonds;             

Bank Obligations. Obligations (including certificates of deposit and  
bankers' acceptances) of banks subject to regulation by the U.S. Government and 
having total assets of $1 billion or more, and instruments secured by such      
obligations, not including obligations of foreign branches of domestic banks    
except to the extent below;                                                     

Eurodollar Certificates of Deposit. Eurodollar certificates of deposit
issued by foreign branches of domestic banks having total assets of $1 billion  
or more;                                                                        

 Obligations of Savings Institutions. Certificates of deposit of savings
banks and savings and loan associations, having total assets of $1 billion or   
more;                                                                           

 Fully Insured Certificates of Deposit. Certificates of deposit of banks
and savings institutions having total assets of less than $1 billion, if the    
principal amount of the obligation is federally insured by the Bank Insurance   
Fund or the Savings Association Insurance Fund (each of which is administered   
by the FDIC), limited to $100,000 principal amount per certificate and to 10%   
or less of the Fund's total assets in all such obligations and in all illiquid  
assets, in the aggregate;                                                       

   Commercial Paper. Commercial paper rated within the two highest grades by
Standard & Poor's Corporation ("S&P") or the two highest grade by Moody's       
Investor's Service, Inc. ("Moody's") or, if not rated, issued by a company      
having an outstanding debt issue rated at least AA by S&P or Aa by Moody's; and 

   Repurchase Agreements. The Fund may invest in repurchase agreements. When
cash may be available for only a few days, it may be invested by the Fund in    
repurchase agreements until such time as it may otherwise be invested or used   
for payments of obligations of the Fund. These agreements, which may be viewed  
as a type of secured lending by the Fund, typically involve the acquisition, by 
the Fund, of debt securities from a selling financial institution such as a     
bank, savings and loan association or broker-dealer. The agreement provides     
that the Fund will sell back to the institution, and that the institution will  
repurchase, the underlying security serving as collateral at a specified price  
and at a fixed time in the future, usually not more than seven days from the    
date of purchase. The collateral will be marked-to-market daily to determine    
that the value of the collateral, as specified in the agreement, does not       
decrease below the purchase price plus accrued interest. If such decrease       
occurs, additional collateral will be requested and, when received, added to    
the account to maintain full collateralization. The Fund will accrue interest   
from the institution until the time when the repurchase is to occur. Although   
this date is deemed by the Fund to be the maturity date of a repurchase         
agreement, the maturities of securities subject to repurchase agreements are    
not subject to any limits.                                                      

While repurchase agreements involve certain risks not associated with 
direct investments in debt securities, the Fund follows procedures designed to  
minimize such risks. These procedures include effecting repurchase transactions 
only with large, well-capitalized and well-established financial institutions   
whose financial condition will be continually monitored by the Investment       
Manager and/or Sub-Advisor subject to procedures established by the Trustees.   
In addition, as described above, the                                            

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value of the collateral underlying the repurchase agreement will be at least    
equal to the repurchase price, including any accrued interest earned on the     
repurchase agreement. In the event of a default or bankruptcy by a selling      
financial institution, the Fund will seek to liquidate such collateral.         
However, the exercising of the Fund's right to liquidate such collateral could  
involve certain costs or delays and, to the extent that proceeds from any sale  
upon a default of the obligation to repurchase were less than the repurchase    
price, the Fund could suffer a loss. It is the current policy of the Fund not   
to invest in repurchase agreements that do not mature within seven days if any  
such investment, together with any other illiquid assets held by the Fund,      
amounts to more than 15% of its net assets.                                     

  REVERSE REPURCHASE AGREEMENTS AND DOLLAR ROLLS. The Fund may use reverse
repurchase agreements for purposes of meeting redemptions or as part of its     
investment strategy and may also use dollar rolls as part of its investment     
strategy.                                                                       

Reverse repurchase agreements involve sales by the Fund of assets     
concurrently with an agreement by the Fund to repurchase the same assets at a   
later date at a fixed price. Reverse repurchase agreements involve the risk     
that the market value of the securities the Fund is obligated to purchase under 
the agreement may decline below the repurchase price. In the event the buyer of 
securities under a reverse repurchase agreement files for bankruptcy or becomes 
insolvent, the Fund's use of the proceeds of the agreement may be restricted    
pending a determination by the other party, or its trustee or receiver, whether 
to enforce the Fund's obligation to repurchase the securities.                  

Dollar rolls involve the Fund selling securities for delivery in the  
current month and simultaneously contracting to repurchase substantially        
similar (same type and coupon) securities on a specified future date. During    
the roll period, the Fund will forgo principal and interest paid on the         
securities. The Fund is compensated by the difference between the current sales 
price and the lower forward price for the future purchase (often referred to as 
the "drop") as well as by the interest earned on the cash proceeds of the       
initial sale.                                                                   

   Reverse repurchase agreements and dollar rolls are speculative techniques
involving leverage and are considered borrowings by the Fund. Reverse           
repurchase agreements and dollar rolls are not expected to exceed 25% of the    
Fund's total assets.                                                            

    ZERO COUPON SECURITIES. A portion of the fixed-income securities purchased
by the Fund may be zero coupon securities. Such securities are purchased at a   
discount from their face amount, giving the purchaser the right to receive      
their full value at maturity. The interest earned on such securities is,        
implicitly, automatically compounded and paid out at maturity. While such       
compounding at a constant rate eliminates the risk of receiving lower yields    
upon reinvestment of interest if prevailing interest rates decline, the owner   
of a zero coupon security will be unable to participate in higher yields upon   
reinvestment of interest received on interest-paying securities if prevailing   
interest rates rise.                                                            

A zero coupon security pays no interest to its holder during its life.
Therefore, to the extent the Fund invests in zero coupon securities, it will    
not receive current cash available for distribution to shareholders. In         
addition, zero coupon securities are subject to substantially greater price     
fluctuations during periods of changing prevailing interest rates than are      
comparable securities which pay interest on a current basis. Current federal    
tax law requires that a holder (such as the Fund) of a zero coupon security     
accrue a portion of the discount at which the security was purchased as income  
each year even though the Fund receives no interest payments in cash on the     
security during the year.                                                       

  LENDING PORTFOLIO SECURITIES. The Fund may lend its portfolio securities
to brokers, dealers and other financial institutions, provided that the loans   
are callable at any time by the Fund, and are at all times secured by cash or   
cash equivalents, which are maintained in a segregated account pursuant to      
applicable regulations and that are equal to at least 100% of the market value, 
determined daily, of the loaned securities. The advantage of these loans is     
that the Fund continues to receive the income on the loaned securities while at 
the same time earning interest on the cash amounts deposited as collateral,     
which will be invested in short-term obligations. The Fund will not lend more   
than 25% of the value of its total assets.                                      

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As with any extensions of credit, there are risks of delay in recovery
and, in some cases, even loss of rights in the collateral should the borrower   
of the securities fail financially. However, these loans of portfolio           
securities will only be made to firms deemed by the Fund's management to be     
creditworthy and when the income which can be earned from such loans justifies  
the attendant risks. Upon termination of the loan, the borrower is required to  
return the securities to the Fund. Any gain or loss in the market price during  
the loan period would inure to the Fund.                                        

 When voting or consent rights which accompany loaned securities pass to
the borrower, the Fund will follow the policy of calling the loaned securities, 
to be delivered within one day after notice, to permit the exercise of the      
rights if the matters involved would have a material effect on the Fund's       
investment in the loaned securities. The Fund will pay reasonable finder's,     
administrative and custodial fees in connection with a loan of its securities.  

  WHEN-ISSUED AND DELAYED DELIVERY SECURITIES AND FORWARD COMMITMENTS. The
Fund may purchase securities on a when-issued or delayed delivery basis or may  
purchase or sell securities on a forward commitment basis. When these           
transactions are negotiated, the price is fixed at the time of the commitment,  
but delivery and payment can take place a month or more after the date of       
commitment. While the Fund will only purchase securities on a when-issued,      
delayed delivery or forward commitment basis with the intention of acquiring    
the securities, the Fund may sell the securities before the settlement date, if 
it is deemed advisable. The securities so purchased or sold are subject to      
market fluctuation and no interest or dividends accrue to the purchaser prior   
to the settlement date.                                                         

  At the time the Fund makes the commitment to purchase or sell securities
on a when-issued, delayed delivery or forward commitment basis, it will record  
the transaction and thereafter reflect the value, each day, of such security    
purchased, or if a sale, the proceeds to be received, in determining its net    
asset value. At the time of delivery of the securities, their value may be more 
or less than the purchase or sale price. An increase in the percentage of the   
Fund's assets committed to the purchase of securities on a when-issued, delayed 
delivery or forward commitment basis may increase the volatility of its net     
asset value. The Fund will also establish a segregated account on the Fund's    
books in which it will continually maintain cash or cash equivalents or other   
liquid portfolio securities equal in value to commitments to purchase           
securities on a when-issued, delayed delivery or forward commitment basis.      

  WHEN, AS AND IF ISSUED SECURITIES. The Fund may purchase securities on a
"when, as and if issued" basis under which the issuance of the security depends 
upon the occurrence of a subsequent event, such as approval of a merger,        
corporate reorganization or debt restructuring. The commitment for the purchase 
of any such security will not be recognized in the portfolio of the Fund until  
the Investment Manager and/or Sub-Advisor determines that issuance of the       
security is probable. At that time, the Fund will record the transaction and,   
in determining its net asset value, will reflect the value of the security      
daily. At that time, the Fund will also establish a segregated account on the   
Fund's books in which it will maintain cash or cash equivalents or other liquid 
portfolio securities equal in value to recognized commitments for such          
securities.                                                                     

An increase in the percentage of the Fund's assets committed to the   
purchase of securities on a "when, as and if issued" basis may increase the     
volatility of its net asset value. The Fund may also sell securities on a       
"when, as and if issued" basis provided that the issuance of the security will  
result automatically from the exchange or conversion of a security owned by the 
Fund at the time of sale.                                                       

 PRIVATE PLACEMENTS AND RESTRICTED SECURITIES. The Fund may invest up to
15% of its net assets in securities which are subject to restrictions on resale 
because they have not been registered under the Securities Act of 1933 (the     
"Securities Act"), or which are otherwise not readily marketable. (Securities   
eligible for resale pursuant to Rule 144A under the Securities Act, and         
determined to be liquid pursuant to the procedures discussed in the following   
paragraph, are not subject to the foregoing restriction.) These securities are  
generally referred to as "private placements" or "restricted securities."       
Limitations on the resale of these securities may have an adverse effect on     
their marketability, and may prevent the Fund from disposing of them promptly   
at reasonable prices. The Fund may have to bear the expense of registering the  
securities for resale and the risk of substantial delays in effecting the       
registration.                                                                   

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Rule 144A permits the Fund to sell restricted securities to qualified 
institutional buyers without limitation. The Investment Manager and/or          
Sub-Advisor, pursuant to procedures adopted by the Trustees, will make a        
determination as to the liquidity of each restricted security purchased by the  
Fund. If a restricted security is determined to be "liquid," the security will  
not be included within the category "illiquid securities," which under current  
policy may not exceed 15% of the Fund's net assets. However, investing in Rule  
144A securities could have the effect of increasing the level of Fund           
illiquidity to the extent the Fund, at a particular point in time, may be       
unable to find qualified institutional buyers interested in purchasing such     
securities.                                                                     

   YEAR 2000. The investment management services provided to the Fund by the
Investment Manager and the Sub-Advisor and the services provided to             
shareholders by the Distributor and the Transfer Agent depend on the smooth     
functioning of their computer systems. Many computer software systems in use    
today cannot recognize the year 2000, but revert to 1900 or some other date,    
due to the manner in which dates were encoded and calculated. That failure      
could have a negative impact on the handling of securities trades, pricing and  
account services. The Investment Manager, the Sub-Advisor, the Distributor and  
the Transfer Agent have been actively working on necessary changes to their own 
computer systems to prepare for the year 2000 and expect that their systems     
will be adapted before that date, but there can be no assurance that they will  
be successful, or that interaction with other non-complying computer systems    
will not impair their services at that time.                                    

  In addition, it is possible that the markets for securities in which the
Fund invests may be detrimentally affected by computer failures throughout the  
financial services industry beginning January 1, 2000. Improperly functioning   
trading systems may result in settlement problems and liquidity issues. In      
addition, corporate and governmental data processing errors may result in       
production problems for individual companies and overall economic               
uncertainties. Earnings of individual issuers will be affected by remediation   
costs, which may be substantial and may be reported inconsistently in U.S. and  
foreign financial statements. Accordingly, the Fund's investments may be        
adversely affected.                                                             

C. FUND POLICIES/INVESTMENT RESTRICTIONS                                        

    The investment objective, policies and restrictions listed below have been
adopted by the Fund as fundamental policies. Under the Investment Company Act   
of 1940 (the "Investment Company Act"), a fundamental policy may not be changed 
without the vote of a majority of the outstanding voting securities of the      
Fund. The Investment Company Act defines a majority as the lesser of (a) 67% or 
more of the shares present at a meeting of shareholders, if the holders of 50%  
of the outstanding shares of the Fund are present or represented by proxy; or   
(b) more than 50% of the outstanding shares of the Fund. For purposes of the    
following restrictions: (i) all percentage limitations apply immediately after  
a purchase or initial investment; and (ii) any subsequent change in any         
applicable percentage resulting from market fluctuations or other changes in    
total or net assets does not require elimination of any security from the       
portfolio.                                                                      

The Fund will:                                                        

1.   Seek to earn a high level of current income while maintaining    
relatively low volatility of principal.                     

The Fund may not:                                                     

   1.   Purchase or sell real estate or interests therein (including limited
        partnership interests), although the Fund may purchase securities of
         issuers which engage in real estate operations and securities secured
by real estate or interests therein.                        

     2.   Purchase oil, gas or other mineral leases, rights or royalty contracts
    or exploration or development programs, except that the Fund may
      invest in the securities of companies which operate, invest in, or
sponsor such programs.                                      

3.   Borrow money, except that the Fund (i) may borrow from a bank for
         temporary or emergency purposes in amounts not exceeding 5% (taken at
          the lower of cost or current value) of its total assets (not including
   the amount borrowed), and (ii) may engage in reverse repurchase
agreements and dollar rolls.                                

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4.   Pledge its assets or assign or otherwise encumber them except to 
  secure borrowings effected within the limitations set forth in
    restriction (3). For the purpose of this restriction, collateral
        arrangements with respect to initial or variation margin for futures
are not deemed to be pledges of assets.                     

  5.   Issue senior securities as defined in the Act except insofar as the
        Fund may be deemed to have issued a senior security by reason of (a)
         entering into any repurchase agreement; (b) purchasing any securities
         on a when-issued or delayed delivery basis; (c) purchasing or selling
     any financial futures contracts or options thereon; (d) borrowing
         money in accordance with restrictions described above; or (e) lending
portfolio securities.                                       

6.   Make loans of money or securities, except: (a) by the purchase of
         portfolio securities in which the Fund may invest consistent with its
      investment objective and policies; (b) by investment in repurchase
agreements; or (c) by lending its portfolio securities.     

7.   Make short sales of securities.                                  

     8.   Purchase securities on margin, except for such short-term loans as are
       necessary for the clearance of portfolio securities. The deposit or
         payment by the Fund of initial or variation margin in connection with
     futures contracts is not considered the purchase of a security on
margin.                                                     

   9.   Engage in the underwriting of securities, except insofar as the Fund
    may be deemed an underwriter under the Securities Act of 1933 in
disposing of a portfolio security.                          

10.  Invest for the purpose of exercising control or management of any
other issuer.                                               

If a percentage restriction is adhered to at the time of investment, a
later increase or decrease in percentage resulting from a change in values of   
portfolio securities or amount of total or net assets will not be considered a  
violation of any of the foregoing restrictions.                                 

III. MANAGEMENT OF THE FUND                                                     
--------------------------------------------------------------------------------

A. BOARD OF TRUSTEES                                                            

   The Board of Trustees of the Fund oversees the management of the Fund but
does not itself manage the Fund. The Trustees review various services provided  
by or under the direction of the Investment Manager to ensure that the Fund's   
general investment policies and programs are properly carried out. The Trustees 
also conduct their review to ensure that administrative services are provided   
to the Fund in a satisfactory manner.                                           

    Under state law, the duties of the Trustees are generally characterized as
a duty of loyalty and a duty of care. The duty of loyalty requires a Trustee to 
exercise his or her powers in the interest of the Fund and not the Trustee's    
own interest or the interest of another person or organization. A Trustee       
satisfies his or her duty of care by acting in good faith with the care of an   
ordinarily prudent person and in a manner the Trustee reasonably believes to be 
in the best interest of the Fund and its shareholders.                          

B. MANAGEMENT INFORMATION                                                       

TRUSTEES AND OFFICERS. The Board of the Fund consists of eight (8)    
Trustees. These same individuals also serve as trustees for all of the Morgan   
Stanley Dean Witter Funds. Six Trustees (75% of the total number) have no       
affiliation or business connection with the Investment Manager or any of its    
affiliated persons and do not own any stock or other securities issued by the   
Investment Manager's parent company, MSDW or the Sub-Advisor's parent company,  
TCW. These are the "disinterested" or "independent" Trustees. The other two     
Trustees (the "Management Trustees") are affiliated with the Investment         
Manager. All of the Independent Trustees also serve as Independent Trustees of  
"Discover Brokerage Index Series," a mutual fund for which the Investment       
Manager is the investment advisor.                                              

   The Trustees and executive officers of the Fund, their principal business
occupations during the last five years and their affiliations, if any, with the 
Investment Manager or the Sub-Advisor, and with the 84 Morgan Stanley Dean      
Witter Funds are shown below.                                                   

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 NAME, AGE, POSITION WITH FUND AND ADDRESS       PRINCIPAL OCCUPATIONS DURING LAST FIVE YEARS    
-------------------------------------------  ----------------------------------------------------
                                                                                                 
Michael Bozic (58) ........................  Vice Chairman of Kmart Corporation (since           
Trustee                                      December, 1998); Director or Trustee of the Morgan  
c/o Kmart Corporation                        Stanley Dean Witter Funds and Discover Brokerage    
3100 West Big Beaver Road                    Index Series; formerly Chairman and Chief           
Troy, Michigan                               Executive Officer of Levitz Furniture Corporation   
                                             (November, 1995-November, 1998) and President       
                                             and Chief Executive Officer of Hills Department     
                                             Stores (May, 1991-July, 1995); formerly variously   
                                             Chairman, Chief Executive Officer, President and    
                                             Chief Operating Officer (1987-1991) of the Sears    
                                             Merchandise Group of Sears, Roebuck and Co.;        
                                             Director of Eaglemark Financial Services, Inc. and  
                                             Weirton Steel Corporation.                          

Charles A. Fiumefreddo* (65) ..............  Chairman, Director or Trustee and Chief Executive   
Chairman of the Board                        Officer of the Morgan Stanley Dean Witter Funds,    
Chief Executive Officer and Trustee          the TCW/DW Funds and Discover Brokerage Index       
Two World Trade Center                       Series; formerly Chairman, Chief Executive Officer  
New York, New York                           and Director of the Investment Manager, the         
                                             Distributor and MSDW Services Company;              
                                             Executive Vice President and Director of Dean       
                                             Witter Reynolds; Chairman and Director of the       
                                             Transfer Agent; formerly Director and/or officer of 
                                             various MSDW subsidiaries (until June, 1998).       

Edwin J. Garn (66) ........................  Director or Trustee of the Morgan Stanley Dean      
Trustee                                      Witter Funds and Discover Brokerage Index Series;   
c/o Huntsman Corporation                     formerly United States Senator (R-Utah)             
500 Huntsman Way                             (1974-1992) and Chairman, Senate Banking            
Salt Lake City, Utah                         Committee (1980-1986); formerly Mayor of Salt       
                                             Lake City, Utah (1971-1974); formerly Astronaut,    
                                             Space Shuttle Discovery (April 12-19, 1985); Vice   
                                             Chairman, Huntsman Corporation; Director of         
                                             Franklin Covey (time management systems), BMW       
                                             Bank of North America, Inc., United Space Alliance  
                                             (joint venture between Lockheed Martin and the      
                                             Boeing Company) and Nuskin Asia Pacific             
                                             (multilevel marketing); member of the board of      
                                             various civic and charitable organizations.         

Wayne E. Hedien (65) ......................  Retired; Director or Trustee of the Morgan Stanley  
Trustee                                      Dean Witter Funds and Discover Brokerage Index      
c/o Gordon Altman Butowsky                   Series; Director of The PMI Group, Inc. (private    
Weitzen Shalov & Wein                        mortgage insurance); Trustee and Vice Chairman      
Counsel to the Independent Trustees          of The Field Museum of Natural History; formerly    
114 West 47th Street                         associated with the Allstate Companies              
New York, New York                           (1966-1994), most recently as Chairman of The       
                                             Allstate Corporation (March, 1993-December,         
                                             1994) and Chairman and Chief Executive Officer of   
                                             its wholly-owned subsidiary, Allstate Insurance     
                                             Company (July, 1989-December, 1994); director       
                                             of various other business and charitable            
                                             organizations.                                      

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 NAME, AGE, POSITION WITH FUND AND ADDRESS        PRINCIPAL OCCUPATIONS DURING LAST FIVE YEARS    
-------------------------------------------  -----------------------------------------------------
                                                                                                  
Dr. Manuel H. Johnson (50) ................  Senior Partner, Johnson Smick International, Inc.,   
Trustee                                      a consulting firm; Co-Chairman and a founder of      
c/o Johnson Smick International, Inc.        the Group of Seven Council (G7C), an international   
1133 Connecticut Avenue, N.W.                economic commission; Chairman of the Audit           
Washington, D.C.                             Committee and Director or Trustee of the Morgan      
                                             Stanely Dean Witter Funds, the TCW/DW Funds          
                                             and Discover Brokerage Index Series; Trustee of      
                                             the TCW/DW Funds; Trustee of Discover                
                                             Brokerage Index Series; Director of NASDAQ           
                                             (since June, 1995); Director of Greenwich Capital    
                                             Markets, Inc. (broker-dealer) and NVR, Inc. (home    
                                             construction); Chairman and Trustee of the           
                                             Financial Accounting Foundation (oversight           
                                             organization of the Financial Accounting Standards   
                                             Board); formerly Vice Chairman of the Board of       
                                             Governors of the Federal Reserve System              
                                             (1986-1990) and Assistant Secretary of the U.S.      
                                             Treasury.                                            

Michael E. Nugent (62) ....................  General Partner, Triumph Capital, L.P., a private    
Trustee                                      investment partnership; Chairman of the Insurance    
c/o Triumph Capital, L.P.                    Committee and Director or Trustee of the Morgan      
237 Park Avenue                              Stanley Dean Witter Funds, the TCW/DW Funds          
New York, New York                           and Discover Brokerage Index Series; formerly        
                                             Vice President, Bankers Trust Company and BT         
                                             Capital Corporation (1984-1988); director of various 
                                             business organizations.                              

Philip J. Purcell* (55) ...................  Chairman of the Board of Directors and Chief         
Trustee                                      Executive Officer of MSDW, Dean Witter Reynolds      
1585 Broadway                                and Novus Credit Services Inc.; Director of the      
New York, New York                           Distributor; Director or Trustee of the Morgan       
                                             Stanley Dean Witter Funds and Discover Brokerage     
                                             Index Series; Director and/or officer of various     
                                             MSDW subsidiaries.                                   

John L. Schroeder (68) ....................  Retired; Chairman of the Deriatives Committee        
Trustee                                      and Director or Trustee of the Morgan Stanley        
c/o Gordon Altman Butowsky                   Dean Witter Funds, the TCW/DW Funds and              
Weitzen Shalov & Wein                        Discover Brokerage Index Series; Director of         
Counsel to the Independent Trustees          Citizens Utilities Company; formerly Executive Vice  
114 West 47th Street                         President and Chief Investment Officer of Home       
New York, New York                           Insurance Company (August, 1991-September,           
                                             1995).                                               

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 NAME, AGE, POSITION WITH FUND AND ADDRESS        PRINCIPAL OCCUPATIONS DURING LAST FIVE YEARS    
-------------------------------------------  -----------------------------------------------------
                                                                                                  
Mitchell M. Merin (45) ....................  President and Chief Operating Officer of Asset       
President                                    Management of MSDW (since December, 1998);           
Two World Trade Center                       President and Director (since April, 1997) and       
New York, New York                           Chief Executive Officer (since June, 1998) of the    
                                             Investment Manager and MSDW Services                 
                                             Company; Chairman, Chief Executive Officer and       
                                             Director of the Distributor (since June, 1998);      
                                             Chairman and Chief Executive Officer (since June,    
                                             1998) and Director (since January, 1998) of the      
                                             Transfer Agent; Director of various MSDW             
                                             subsidiaries; President of the Morgan Stanley Dean   
                                             Witter Funds, the TCW/DW Funds and Discover          
                                             Brokerage Index Series (since May, 1999);            
                                             previously Chief Strategic Officer of the Investment 
                                             Manager and MSDW Services Company and                
                                             Executive Vice President of the Distributor (April,  
                                             1997-June, 1998), Vice President of the Morgan       
                                             Stanley Dean Witter Funds, the TCW/DW Funds          
                                             and Discover Brokerage Index Series (May,            
                                             1997-April, 1999), and Executive Vice President of   
                                             Dean Witter, Discover & Co.                          

Barry Fink (44) ...........................  Senior Vice President (since March, 1997) and        
Vice President,                              Secretary and General Counsel (since February,       
Secretary and General Counsel                1997) and Director (since July, 1998) of the         
Two World Trade Center                       Investment Manager and MSDW Services                 
New York, New York                           Company; Senior Vice President (since March,         
                                             1997) and Assistant Secretary and Assistant          
                                             General Counsel (since February, 1997) of the        
                                             Distributor; Assistant Secretary of Dean Witter      
                                             Reynolds (since August, 1996); Vice President,       
                                             Secretary and General Counsel of the Morgan          
                                             Stanley Dean Witter Funds and the TCW/DW             
                                             Funds (since February, 1997); Vice President,        
                                             Secretary and General Counsel of Discover            
                                             Brokerage Index Series; previously First Vice        
                                             President (June, 1993-February, 1997), Vice          
                                             President and Assistant Secretary and Assistant      
                                             General Counsel of the Investment Manager and        
                                             MSDW Services Company and Assistant Secretary        
                                             of the Morgan Stanley Dean Witter Funds and the      
                                             TCW/DW Funds.                                        

Philip A. Barach (46) .....................  Group Managing Director and Chief Investment         
Vice President                               Officer--Investment Grade Fixed Income of the        
865 South Figueroa Street                    Adviser, Trust Company of the West and TCW           
Los Angeles, California                      Asset Management Company; Vice President of          
                                             various TCW/DW Funds.                                

James M. Goldberg (53) ....................  Managing Director of the Advisor, Managing           
Vice President                               Director and Chairman of the Fixed Income Policy     
865 South Figueroa Street                    Committee of Trust Company of the West and           
Los Angeles, California                      TCW Asset Management Company; Vice President         
                                             of various TCW/DW Funds.                             

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 NAME, AGE, POSITION WITH FUND AND ADDRESS       PRINCIPAL OCCUPATIONS DURING LAST FIVE YEARS    
-------------------------------------------  ----------------------------------------------------
                                                                                                 
Jeffrey E. Gundlach (39) ..................  Group Managing Director and Chairman,               
Vice President                               Multi-Strategy Fixed Income Committee of the        
865 South Figueroa Street                    Adviser, Trust Company of the West and TCW          
Los Angeles, California                      Asset Management Company; Vice President of         
                                             various TCW/DW Funds.                               

Frederick H. Horton (40) ..................  Managing Director of the Adviser, Trust Company     
Vice President                               of the West and TCW Asset Management Company        
865 South Figueroa Street                    (since October, 1993); previously Senior Portfolio  
Los Angeles, California                      Manager for Dewey Square Investors (June,           
                                             1991--September, 1993).                             

Thomas F. Caloia (53) .....................  First Vice President and Assistant Treasurer of the 
Treasurer                                    Manager and MSDW Advisors; Treasurer of the         
Two World Trade Center                       TCW/DW Funds, the Morgan Stanley Dean Witter        
New York, New York                           Funds and Discover Brokerage Index Series.          

----------                                                                      
* Denotes Trustees who are "interested persons" of the Fund as defined by the   
Investment Company Act.                                                     

In addition, Ronald E. Robison, Executive Vice President, Chief       
Administrative Officer and Director of the Investment Manager and MSDW Services 
Company, Robert S. Giambrone, Senior Vice President of the Investment Manager,  
MSDW Services Company, the Distributor and the Transfer Agent and Director of   
the Transfer Agent, and Joseph J. McAlinden, Executive Vice President and Chief 
Investment Officer of the Investment Manager and Director of the Transfer       
Agent, and Peter M. Avelar, Kenton J. Hinchliffe, Mark Bavoso, and Jonathan R.  
Page, Senior Vice Presidents of the Investment Manager, are Vice Presidents of  
the Fund,                                                                       

  In addition, Frank Bruttomesso, Marilyn K. Cranney, Lou Anne D. McInnis,
Carsten Otto and Ruth Rossi, First Vice Presidents and Assistant General        
Counsels of the Investment Manager and MSDW Services Company, and Todd Lebo,    
Vice President and Assistant General Counsel of the Investment Manager and MSDW 
Services Company, are Assistant Secretaries of the Fund.                        

    INDEPENDENT TRUSTEES AND THE COMMITTEES. Law and regulation establish both
general guidelines and specific duties for the Independent Trustees. The Morgan 
Stanley Dean Witter Funds seek as Independent Trustees individuals of           
distinction and experience in business and finance, government service or       
academia; these are people whose advice and counsel are in demand by others and 
for whom there is often competition. To accept a position on the Funds' Boards, 
such individuals may reject other attractive assignments because the Funds make 
substantial demands on their time. Indeed, by serving on the Funds' Boards,     
certain Trustees who would otherwise be qualified and in demand to serve on     
bank boards would be prohibited by law from doing so. All of the Independent    
Trustees serve as members of the Audit Committee. In addition, three of the     
Trustees, including two Independent Trustees, serve as members of the           
Derivatives Committee and the Insurance Committee.                              

  The Independent Trustees are charged with recommending to the full Board
approval of management, advisory and administration contracts, plans and        
distribution and underwriting agreements; continually reviewing Fund            
performance; checking on the pricing of portfolio securities, brokerage         
commissions, transfer agent costs and performance, and trading among Funds in   
the same complex; and approving fidelity bond and related insurance coverage    
and allocations, as well as other matters that arise from time to time. The     
Independent Trustees are required to select and nominate individuals to fill    
any Independent Trustee vacancy on the Board of any Fund that has a Rule 12b-1  
plan of distribution. Most of the Morgan Stanley Dean Witter Funds have a Rule  
12b-1 plan.                                                                     

The Audit Committee is charged with recommending to the full Board the
engagement or discharge of the Fund's independent accountants; directing        
investigations into matters within the scope of the independent accountants'    
duties, including the power to retain outside specialists; reviewing with the   
independent accountants the audit plan and results of the auditing engagement;  
approving professional services provided by the independent accountants and     
other accounting firms prior to the performance of the services; reviewing the  
independence of the independent accountants; considering the range of           

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audit and non-audit fees; reviewing the adequacy of the Fund's system of        
internal controls; and preparing and submitting Committee meeting minutes to    
the full Board.                                                                 

  The Board of each Fund has a Derivatives Committee to approve parameters
for and monitor the activities of the Fund with respect to derivative           
investments, if any, made by the Fund.                                          

Finally, the Board of each Fund has formed an Insurance Committee to  
review and monitor the insurance coverage maintained by the Fund.               

ADVANTAGES OF HAVING SAME INDIVIDUALS AS INDEPENDENT TRUSTEES FOR ALL 
MORGAN STANLEY DEAN WITTER FUNDS. The Independent Trustees and the Funds'       
management believe that having the same Independent Trustees for each of the    
Morgan Stanley Dean Witter Funds avoids the duplication of effort that would    
arise from having different groups of individuals serving as Independent        
Trustees for each of the Funds or even of sub-groups of Funds. They believe     
that having the same individuals serve as Independent Trustees of all the Funds 
tends to increase their knowledge and expertise regarding matters which affect  
the Fund complex generally and enhances their ability to negotiate on behalf of 
each Fund with the Fund's service providers. This arrangement also precludes    
the possibility of separate groups of Independent Trustees arriving at          
conflicting decisions regarding operations and management of the Funds and      
avoids the cost and confusion that would likely ensue. Finally, having the same 
Independent Trustees serve on all Fund Boards enhances the ability of each Fund 
to obtain, at modest cost to each separate Fund, the services of Independent    
Trustees, of the caliber, experience and business acumen of the individuals who 
serve as Independent Trustees of the Morgan Stanley Dean Witter Funds.          

TRUSTEE AND OFFICER INDEMNIFICATION. The Fund's Declaration of Trust  
provides that no Trustee, officer, employee or agent of the Fund is liable to   
the Fund or to a shareholder, nor is any Trustee, officer, employee or agent    
liable to any third persons in connection with the affairs of the Fund, except  
as such liability may arise from his/her or its own bad faith, willful          
misfeasance, gross negligence or reckless disregard of his/her or its duties.   
It also provides that all third persons shall look solely to the Fund property  
for satisfaction of claims arising in connection with the affairs of the Fund.  
With the exceptions stated, the Declaration of Trust provides that a Trustee,   
officer, employee or agent is entitled to be indemnified against all liability  
in connection with the affairs of the Fund.                                     

C. COMPENSATION                                                                 

 The Fund pays each Independent Trustee an annual fee of $800 plus a per
meeting fee of $50 for meetings of the Board of Trustees, the Independent       
Trustees or Committees of the Board of Trustees attended by the Trustee (the    
Fund pays the Chairman of the Audit Committee an additional annual fee of $750, 
and the Chairman of the Derivatives and Insurance Committees additional annual  
fees of $500). If a Board meeting and a meeting of the Independent Trustees or  
a Committee meeting, or a meeting of the Independent Trustees and/or more than  
one Committee meeting, take place on a single day, the Trustees are paid a      
single meeting fee by the Fund. The Fund also reimburses such Trustees for      
travel and other out-of-pocket expenses incurred by them in connection with     
attending such meetings. Trustees and officers of the Fund who are or have been 
employed by the Investment Manager or an affiliated company receive no          
compensation or expense reimbursement from the Fund for their services as       
Trustee.                                                                        

At their June 8, 1999 meeting, shareholders elected or re-elected, as 
appropriate, the following eight individuals to the Fund's Board of Trustees to 
serve for indefinite terms: Michael Bozic, Charles A. Fiumefreddo, Edwin Jacob  
(Jake) Garn, Wayne E. Hedien, Dr. Manuel H. Johnson, Michael E. Nugent, Philip  
J. Purcell and John L. Schroeder. Messrs. Fiumefreddo, Johnson, Nugent and      
Schroeder previously served as Trustees of the Fund and were previously elected 
by shareholders. Messrs. Bozic, Garn, Hedien and Purcell previously held        
directorships or trusteeships with the other Morgan Stanley Dean Witter Funds   
and were elected to replace Messrs. Argue, DeMartini, Larkin and Stern who      
resigned as Trustees. Messrs. Bozic, Garn, Hedien and Purcell commenced service 
at the time the new Investment Management Agreement took effect on June 25,     
1999. Prior to the effectiveness of the election of Messrs. Bozic, Garn, Hedien 
and Purcell and the resignation of Messrs. Argue, DeMartini,                    

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Larkin and Stern, the Fund paid each Independent Trustee an annual fee of       
$2,225 plus a per meeting fee of $200 for meetings of the Board of Trustees or  
committees of the Board attended by the Trustee. The fee paid by the Fund to    
the Chairman of the Audit Committee and the Chairman of the Independent         
Trustees remained unchanged.                                                    

The following table illustrates the compensation that the Fund paid to
those of its Independent Trustees who were Trustees of the Fund on October 31,  
1998, for the fiscal year ended on that date.                                   

 FUND COMPENSATION

                                                               AGGREGATE
                                                              COMPENSATION
NAME OF INDEPENDENT TRUSTEE                                      FROM THE FUND  
---------------------------                                      -------------  

Dr. Manuel H. Johnson .........................................     $5,256      
Michael E. Nugent .............................................      5,256      
John L. Schroeder .............................................      5,456      

  At such time as the Fund has paid fees to the Independent Trustees for a
full fiscal year at the lower current compensation rates set forth above, and   
assuming that during such fiscal year the Fund holds the same number of         
meetings of the Board, the Independent Trustees and the Committees as were held 
by the other Morgan Stanley Dean Witter Funds during the calendar year ended    
December 31, 1998, it is estimated that the compensation paid to each           
Independent Trustee during such fiscal year will be $1,650 and an additional    
$750 to Dr. Johnson who serves as Chairman of the Audit Committee.              

The following table illustrates the compensation paid to the Fund's   
Independent Trustees for the calendar year ended December 31, 1998 for services 
to the 85 Morgan Stanley Dean Witter Funds and, in the case of Messrs. Johnson, 
Nugent and Schroeder, the 11 TCW/DW Funds that were in operation at December    
31, 1998. With respect to Messrs. Johnson, Nugent and Schroeder, the TCW/DW     
Funds are included solely because of a limited exchange privilege between those 
Funds and five Morgan Stanley Dean Witter Money Market Funds. No compensation   
was paid to the Fund's Independent Trustees by Discover Brokerage Index Series  
for the calendar year ended December 31, 1998.                                  

CASH COMPENSATION FROM MORGAN STANLEY DEAN WITTER FUNDS AND TCW/DW FUNDS  

                                                        [Enlarge/Download Table]

                                                                        TOTAL CASH   
                                                                       COMPENSATION  
                                                                      FOR SERVICES TO
                                FOR SERVICE                              85 MORGAN   
                               AS DIRECTOR OR        FOR SERVICE AS    STANLEY DEAN  
                                TRUSTEE AND            TRUSTEE AND     WITTER FUNDS  
                              COMMITTEE MEMBER      COMMITTEE MEMBER      AND 11     
NAME OF                  OF 85 MORGAN STANLEY DEAN    OF 11 TCW/DW        TCW/DW     
INDEPENDENT TRUSTEE             WITTER FUNDS              FUNDS            FUNDS     
-------------------             ------------              -----            -----     
                                                                                     
Michael Bozic ..........          $120,150                    --         $120,150    
Edwin J. Garn ..........           132,450                    --          132,450    
Wayne E. Hedien ........           132,350                    --          132,350    
Dr. Manuel H. Johnson ..           128,400               $62,331          190,731    
Michael E. Nugent ......           132,450                62,131          194,581    
John L. Schroeder ......           132,450                64,731          197,181    

As of the date of this Statement of Additional Information, 55 of the 
Morgan Stanley Dean Witter Funds, not including the Fund, have adopted a        
retirement program under which an Independent Trustee who retires after serving 
for at least five years (or such lesser period as may be determined by the      
Board)                                                                          

----------                                                                      
(1)   An Eligible Trustee may elect alternative payments of his or her          
retirement benefits based upon the combined life expectancy of the  
Eligible Trustee and his or her spouse on the date of such Eligible 
  Trustee's retirement. In addition, the Eligible Trustee may elect that
  the surviving spouse's periodic payment of benefits will be equal to a
     lower percentage of the periodic amount when both spouses were alive. The
   amount estimated to be payable under this method, through the remainder
     of the later of the lives of the Eligible Trustee and spouse, will be the
actuarial equivalent of the Regular Benefit.                        

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as an Independent Director or Trustee of any Morgan Stanley Dean Witter Fund    
that has adopted the retirement program (each such Fund referred to as an       
"Adopting Fund" and each such Trustee referred to as an "Eligible Trustee") is  
entitled to retirement payments upon reaching the eligible retirement age       
(normally, after attaining age 72), Annual payments are based upon length of    
service.                                                                        

  Currently, upon retirement, each Eligible Trustee is entitled to receive
from the Adopting Fund, commencing as of his or her retirement date and         
continuing for the remainder of his or her life, an annual retirement benefit   
(the "Regular Benefit") equal to 30.22% of his or her Eligible Compensation     
plus 0.5036667% of such Eligible Compensation for each full month of service as 
an Independent Director or Trustee of any Adopting Fund in excess of five years 
up to a maximum of 60.44% after ten years of service. The foregoing percentages 
may be changed by the Board(1). "Eligible Compensation" is one-fifth of the     
total compensation earned by such Eligible Trustee for service to the Adopting  
Fund in the five year period prior to the date of the Eligible Trustee's        
retirement. Benefits under the retirement program are not secured or funded by  
the Adopting Funds.                                                             

The following table illustrates the retirement benefits accrued to the
Fund's Independent Trustees by the 55 Morgan Stanley Dean Witter Funds (not     
including the Fund) for the year ended December 31, 1998, and the estimated     
retirement benefits for the Independent Trustees, to commence upon their        
retirement, from the 55 Morgan Stanley Dean Witter Funds as of December 31,     
1998.                                                                           

RETIREMENT BENEFITS FROM ALL MORGAN STANLEY DEAN WITTER FUNDS 

                                                        [Enlarge/Download Table]

                                 FOR ALL ADOPTING FUNDS                                                     
                            ---------------------------------                                               
                               ESTIMATED                                                                    
                                CREDITED                                                                    
                                 YEARS           ESTIMATED     RETIREMENT BENEFITS      ESTIMATED ANNUAL    
                             OF SERVICE AT     PERCENTAGE OF   ACCRUED AS EXPENSES  BENEFITS UPON RETIREMENT
NAME OF                        RETIREMENT         ELIGIBLE            BY ALL                FROM ALL        
INDEPENDENT TRUSTEE           (MAXIMUM 10)      COMPENSATION      ADOPTING FUNDS       ADOPTING FUNDS(2)    
-------------------           ------------      ------------      --------------       -----------------    
                                                                                                            
Michael Bozic .............        10               60.44%           $22,377                $52,250         
Edwin J. Garn .............        10               60.44             35,225                 52,250         
Wayne E. Hedien ...........         9               51.37             41,979                 44,413         
Dr. Manuel H. Johnson              10               60.44             14,047                 52,250         
Michael E. Nugent .........        10               60.44             25,336                 52,250         
John L. Schroeder .........         8               50.37             45,117                 44,343         

----------                                                                      
(2)   Based on current levels of compensation. Amount of annual benefits also   
    varies depending on the Trustee's elections described in Footnote (1) on
page 15.                                                            

IV. CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES                         
--------------------------------------------------------------------------------

  The following persons owned 5% or more of the Class A Shares of the Fund
as of May 31, 1999:                                                             

[TO COME] 

   As of the date of this Statement of Additional Information, the aggregate
number of shares of beneficial interest of the Fund owned by the Fund's         
officers and Trustees as a group was less than 1% of the Fund's shares of       
beneficial interest outstanding.                                                

V. MANAGEMENT, INVESTMENT ADVICE AND OTHER SERVICES                             
--------------------------------------------------------------------------------

A. INVESTMENT MANAGER AND SUB-ADVISOR                                           

   The Investment Manager to the Fund is Morgan Stanley Dean Witter Advisors
Inc., a Delaware corporation, whose address is Two World Trade Center, New      
York, New York 10048. The Investment Manager is a wholly-owned subsidiary of    
MSDW, a Delaware corporation. MSDW is a preeminent global financial services    
firm that maintains leading market positions in each of its three primary       
businesses: securities, asset management and credit services.                   

  The Sub-Advisor is TCW Funds Management, Inc., a wholly-owned subsidiary
of TCW, whose direct and indirect subsidiaries provide a variety of trust,      
investment management and investment advisory                                   

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services. The Sub-Advisor is headquartered at 865 South Figueroa Street, Suite  
1800, Los Angeles, California 90017. Robert A. Day, who is Chairman of the      
Board of Directors of TCW, may be deemed to be a control person of the          
Sub-Advisor by virtue of the aggregate ownership by Mr. Day and his family of   
more than 25% of the outstanding voting stock of TCW. The Sub-Advisor was       
retained to provide sub-advisory services to the Fund effective June 25, 1999.  

     Pursuant to an Investment Management Agreement (the "Management Agreement")
with the Investment Manager, the Fund has retained the Investment Manager to    
provide administrative services, manage its business affairs and supervise the  
investment of the Fund's assets. The Fund pays the Investment Manager monthly   
compensation calculated daily by applying the following annual rates to the net 
assets of the Fund determined as of the close of each business day: 0.65% to    
the portion of daily net assets not exceeding $500 million; and 0.60% to the    
portion of daily net assets exceeding $500 million. The Investment Manager has  
retained its wholly-owned subsidiary, MSDW Services Company, to perform         
administrative services for the Fund.                                           

    Under a Sub-Advisory Agreement (the "Sub-Advisory Agreement ") between the
Sub-Advisor and the Investment Manager, the Sub-Advisor provides the Fund with  
investment advice and portfolio management relating to the Fund's investments   
in securities, subject to the overall supervision of the Investment Manager.    
The Investment Manager pays the Sub-Advisor monthly compensation equal to 40%   
of the Investment Manager's fee.                                                

Prior to June, 1999, the Fund was managed by MSDW Services Company,   
pursuant to a management agreement between the Fund and MSDW Services Company   
and was advised by TCW Funds Management, Inc. pursuant to an advisory agreement 
between the Fund and TCW Funds Management, Inc. As part of an overall           
consolidation of the TCW/DW Family of Funds and the Morgan Stanley Dean Witter  
Family of Funds, the Fund's Board of Trustees recommended on February 25, 1999  
and shareholders of the Fund approved on June 8, 1999 the Investment Management 
Agreement between the Fund and Morgan Stanley Dean Witter Advisors Inc. The     
Board also recommended and shareholders also approved the Sub-Advisory          
Agreement between MSDW Advisors and TCW Funds Management, Inc. The fee rate     
under the Management Agreement with MSDW Advisors is identical to the total     
aggregate fee rate in effect under the previous management and advisory         
agreements. For the fiscal years ended October 31, 1996, 1997 and 1998 MSDW     
Services Company accrued total compensation under the old management agreement  
in the amounts of $1,912,210, $1,052,959 and $697,150, respectively. For the    
same periods, TCW Funds Management, Inc. accrued total compensation in its      
capacity of adviser to the Fund in the amounts of $1,274,806, $701,973 and      
$464,767, respectively.                                                         

B. PRINCIPAL UNDERWRITER                                                        

 The Fund's principal underwriter is the Distributor (which has the same
address as the Investment Manager). In this capacity, the Fund's shares are     
distributed by the Distributor. The Distributor has entered into a Selected     
Dealer Agreement with Dean Witter Reynolds, which through its own sales         
organization sells shares of the Fund. In addition, the Distributor may enter   
into similar agreements with other selected broker-dealers. The Distributor, a  
Delaware corporation, is a wholly-owned subsidiary of MSDW.                     

The Distributor bears all expenses it may incur in providing services 
under the Distribution Agreement. These expenses include the payment of         
commissions for sales of the Fund's shares and incentive compensation to        
Financial Advisors. The Distributor also pays certain expenses in connection    
with the distribution of the Fund's shares, including the costs of preparing,   
printing and distributing advertising or promotional materials, and the costs   
of printing and distributing prospectuses and supplements thereto used in       
connection with the offering and sale of the Fund's shares. The Fund bears the  
costs of initial typesetting, printing and distribution of prospectuses and     
supplements thereto to shareholders. The Fund also bears the costs of           
registering the Fund and its shares under federal and state securities laws and 
pays filing fees in accordance with state securities laws.                      

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  The Fund and the Distributor have agreed to indemnify each other against
certain liabilities, including liabilities under the Securities Act. Under the  
Distribution Agreement, the Distributor uses its best efforts in rendering      
services to the Fund, but in the absence of willful misfeasance, bad faith,     
gross negligence or reckless disregard of its obligations, the Distributor is   
not liable to the Fund or any of its shareholders for any error of judgment or  
mistake of law or for any act or omission or for any losses sustained by the    
Fund or its shareholders.                                                       

C. SERVICES PROVIDED BY THE INVESTMENT MANAGER, THE SUB-ADVISOR AND FUND        
EXPENSES PAID BY THIRD PARTIES                                            

    The Investment Manager supervises the investment of the Fund's assets. The
Investment Manager obtains and evaluates the information and advice relating to 
the economy, securities markets, and specific securities as it considers        
necessary or useful to continuously oversee the management of the assets of the 
Fund in a manner consistent with its investment objective.                      

  Under the terms of the Management Agreement, the Investment Manager also
maintains certain of the Fund's books and records and furnishes, at its own     
expense, the office space, facilities, equipment, clerical help, bookkeeping    
and certain legal services as the Fund may reasonably require in the conduct of 
its business, including the preparation of prospectuses, proxy statements and   
reports required to be filed with federal and state securities commissions      
(except insofar as the participation or assistance of independent accountants   
and attorneys is, in the opinion of the Investment Manager, necessary or        
desirable). In addition, the Investment Manager pays the salaries of all        
personnel, including officers of the Fund, who are employees of the Investment  
Manager. The Investment Manager also bears the cost of telephone service, heat, 
light, power and other utilities provided to the Fund.                          

    Pursuant to the Sub-Advisory Agreement, the Sub-Advisor has been retained,
subject to the overall supervision of the Investment Manager, to continuously   
furnish investment advice concerning individual security selections, asset      
allocations and overall economic trends.                                        

Expenses not expressly assumed by the Investment Manager under the    
Management Agreement or by the Distributor, will be paid by the Fund. These     
expenses will be allocated among the four Classes of shares pro rata based on   
the net assets of the Fund attributable to each Class, except as described      
below. Such expenses include, but are not limited to: expenses of the Plan of   
Distribution pursuant to Rule 12b-1; charges and expenses of any registrar,     
custodian, stock transfer and dividend disbursing agent; brokerage commissions; 
taxes; engraving and printing share certificates; registration costs of the     
Fund and its shares under federal and state securities laws; the cost and       
expense of printing, including typesetting, and distributing prospectuses of    
the Fund and supplements thereto to the Fund's shareholders; all expenses of    
shareholders' and Trustees' meetings and of preparing, printing and mailing of  
proxy statements and reports to shareholders; fees and travel expenses of       
Trustees or members of any advisory board or committee who are not employees of 
the Investment Manager or any corporate affiliate of the Investment Manager;    
all expenses incident to any dividend, withdrawal or redemption options;        
charges and expenses of any outside service used for pricing of the Fund's      
shares; fees and expenses of legal counsel, including counsel to the Trustees   
who are not interested persons of the Fund or of the Investment Manager (not    
including compensation or expenses of attorneys who are employees of the        
Investment Manager); fees and expenses of the Fund's independent accountants;   
membership dues of industry associations; interest on Fund borrowings; postage; 
insurance premiums on property or personnel (including officers and Trustees)   
of the Fund which inure to its benefit; extraordinary expenses (including, but  
not limited to, legal claims and liabilities and litigation costs and any       
indemnification relating thereto); and all other costs of the Fund's operation. 

The Management Agreement provides that in the absence of willful      
misfeasance, bad faith, gross negligence or reckless disregard of its           
obligations thereunder, the Investment Manager is not liable to the Fund or any 
of its investors for any act or omission by the Investment Manager or for any   
losses sustained by the Fund or its investors.                                  

    The Management Agreement will remain in effect from year to year, provided
continuance of the Management Agreement is approved at least annually by the    
vote of the holders of a majority, as defined in the Investment Company Act, of 
the outstanding shares of the Fund, or by the Trustees; provided that in either 
event such continuance is approved annually by the vote of a majority of the    
Trustees who are not parties to the Management Agreement or the Sub-Advisory    
Agreement or are "independent Trustees," which votes must be cast in person at  
a meeting called for the purpose of voting on such approval.                    

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D. RULE 12B-1 PLAN                                                              

    In accordance with a Plan of Distribution pursuant to Rule 12b-1 under the
Investment Company Act between the Fund and the Distributor, the Distributor    
provides certain services in connection with the promotion of sales of Fund     
shares (the "Plan").                                                            

   The Distributor receives the proceeds of front-end sales charges ("FSCs")
imposed on most sales of the Fund's shares. The Distributor has informed the    
Fund that it has received approximately $58,000, $44,000 and $50,000,           
respectively in sales charges on sales of the Fund's shares for the fiscal      
years ended November 30, 1996, 1997 and 1998.                                   

The Plan provides that the Distributor bears the expense of all       
promotional and distribution related activities on behalf of the Fund, except   
for expenses that the Trustees determine to reimburse, as described below. The  
following activities and services may be provided by the Distributor under the  
Plan: (1) compensation to and expenses of Dean Witter Reynolds' Financial       
Advisors and other Selected Broker-Dealers' account executives and other        
employees, including overhead and telephone expenses; (2) sales incentives and  
bonuses to sales representatives and to marketing personnel in connection with  
promoting sales of the Fund's shares; (3) expenses incurred in connection with  
promoting sales of the Fund's shares; (4) preparing and distributing sales      
literature; and (5) providing advertising and promotional activities, including 
direct mail solicitation and television, radio, newspaper, magazine and other   
media advertisements.                                                           

 The Fund is authorized to reimburse specific expenses incurred or to be
incurred in promoting the distribution of the Fund's shares. Reimbursement is   
made through payments at the end of each month. The amount of each monthly      
payment may in no event exceed an amount equal to a payment at the annual rate  
of 0.75 of 1% of the Fund's average daily net assets during the month. No       
interest or other financing charges will be incurred for which reimbursement    
payments under the Plan will be made. In addition, no interest charges, if any, 
incurred on any distribution expenses will be reimbursable under the Plan. In   
the case of all expenses other than expenses representing a residual to         
Financial Advisors and other authorized financial representatives, such amounts 
shall be determined at the beginning of each calendar quarter by the Trustees,  
including a majority of the Independent 12b-1 Trustees. Expenses representing a 
residual to Financial Advisors and other authorized financial representatives,  
may be reimbursed without prior determination. In the event that the            
Distributor proposes that monies shall be reimbursed for other than such        
expenses, then in making quarterly determinations of the amounts that may be    
expended by the Fund, the Investment Manager provides and the Trustees review a 
quarterly budget of projected incremental distribution expenses to be incurred  
on behalf of the Fund, together with a report explaining the purposes and       
anticipated benefits of incurring such expenses. The Trustees determine which   
particular expenses, and the portions thereof, that may be borne by the Fund,   
and in making such a determination shall consider the scope of the              
Distributor's commitment to promoting the distribution of the Fund's shares.    

The Fund accrued a total of $1,299,994 pursuant to the Plan of        
Distribution for the fiscal year ended October 31, 1998. It is estimated that   
the amounts paid by the Fund for distribution were for expenses which relate to 
compensation of sales personnel and associated overhead expenses.               

Under the Plan, the Distributor uses its best efforts in rendering    
services to the Fund, but in the absence of willful misfeasance, bad faith,     
gross negligence or reckless disregard of its obligations, the Distributor is   
not liable to the Fund or any of its shareholders for any error of judgment or  
mistake of law or for any act or omission or for any losses sustained by the    
Fund or its shareholders.                                                       

Under the Plan, the Distributor provides the Fund, for review by the  
Trustees, and the Trustees review, promptly after the end of each calendar      
quarter, a written report regarding the incremental distribution expenses       
incurred on behalf of the Fund during such calendar quarter, which report       
includes (1) an itemization of the types of expenses and the purposes           
therefore; (2) the amounts of such expenses; and (3) a description of the       
benefits derived by the Fund. In the Trustees' quarterly review of the Plan     
they consider its continued appropriateness and the level of compensation       
provided therein.                                                               

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No interested person of the Fund nor any Independent Trustee has any  
direct financial interest in the operation of the Plan except to the extent     
that the Distributor, the Investment Manager, Dean Witter Reynolds, MSDW        
Services Company or certain of their employees may be deemed to have such an    
interest as a result of benefits derived from the successful operation of the   
Plan or as a result of receiving a portion of the amounts expended thereunder   
by the Fund.                                                                    

   On an annual basis, the Trustees, including a majority of the Independent
Trustees, consider whether the Plan should be continued. Prior to approving the 
last continuation of the Plan, the Trustees requested and received from the     
Distributor and reviewed all the information which they deemed necessary to     
arrive at an informed determination. In making their determination to continue  
the Plan, the Trustees considered: (1) the Fund's experience under the Plan and 
whether such experience indicates that the Plan is operating as anticipated;    
(2) the benefits the Fund had obtained, was obtaining and would be likely to    
obtain under the Plan, including that: (a) the Plan is essential in order to    
give Fund investors a choice of alternatives for payment of distribution and    
service charges and to enable the Fund to continue to grow and avoid a pattern  
of net redemptions which, in turn, are essential for effective investment       
management; and (b) without the compensation to individual brokers and the      
reimbursement of distribution and account maintenance expenses of Dean Witter   
Reynolds's branch offices made possible by the 12b-1 fees, Dean Witter Reynolds 
could not establish and maintain an effective system for distribution,          
servicing of Fund shareholders and maintenance of shareholder accounts; and (3) 
what services had been provided and were continuing to be provided under the    
Plan to the Fund and its shareholders. Based upon their review, the Trustees,   
including each of the Independent Trustees, determined that continuation of the 
Plan would be in the best interest of the Fund and would have a reasonable      
likelihood of continuing to benefit the Fund and its shareholders. In the       
Trustees' quarterly review of the Plan, they will consider its continued        
appropriateness and the level of compensation provided therein.                 

   The Plan may not be amended to increase materially the amount to be spent
for the services described therein without approval by the shareholders of the  
Fund, and all material amendments to the Plan must also be approved by the      
Trustees in the manner described above. The Plan may be terminated at any time, 
without payment of any penalty, by vote of a majority of the Independent        
Trustees or by a vote of a majority of the outstanding voting securities of the 
Fund (as defined in the Investment Company Act) on not more than thirty days'   
written notice to any other party to the Plan. So long as the Plan is in        
effect, the election and nomination of Independent Trustees shall be committed  
to the discretion of the Independent Trustees.                                  

E. OTHER SERVICE PROVIDERS                                                      

(1) TRANSFER AGENT/DIVIDEND-PAYING AGENT                              

   Morgan Stanley Dean Witter Trust FSB is the Transfer Agent for the Fund's
shares and the Dividend Disbursing Agent for payment of dividends and           
distributions on Fund shares and Agent for shareholders under various           
investment plans. The principal business address of the Transfer Agent is       
Harborside Financial Center, Plaza Two, Jersey City, New Jersey 07311.          

(2) CUSTODIAN AND INDEPENDENT ACCOUNTANTS                             

  The Bank of New York, 90 Washington Street, New York, New York 10286, is
the Custodian of the Fund's assets. Any of the Fund's cash balances with the    
Custodian in excess of $100,000 are unprotected by federal deposit insurance.   
These balances may, at times, be substantial.                                   

                                                             , serves as
the independent accountants of the Fund. The independent accountants are        
responsible for auditing the annual financial statements of the Fund.           

(3) AFFILIATED PERSONS                                                

  The Transfer Agent is an affiliate of the Investment Manager, and of the
Distributor. As Transfer Agent and Dividend Disbursing Agent, the Transfer      
Agent's responsibilities include maintaining shareholder accounts, disbursing   
cash dividends and reinvesting dividends, processing account registration       

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changes, handling purchase and redemption transactions, mailing prospectuses    
and reports, mailing and tabulating proxies, processing share certificate       
transactions, and maintaining shareholder records and lists. For these          
services, the Transfer Agent receives a per shareholder account fee from the    
Fund and is reimbursed for its out-of-pocket expenses in connection with such   
services.                                                                       

VI. BROKERAGE ALLOCATION AND OTHER PRACTICES                                    
--------------------------------------------------------------------------------

A. BROKERAGE TRANSACTIONS                                                       

    Subject to the general supervision of the Trustees, the Investment Manager
and/or Sub-Advisor are responsible for decisions to buy and sell securities for 
the Fund, the selection of brokers and dealers to effect the transactions, and  
the negotiation of brokerage commissions, if any. The Fund expects that the     
primary market for the securities in which it invests will generally be the     
over-the-counter market. In the over-the-counter market, securities are         
generally traded on a "net" basis with dealers acting as principal for their    
own accounts without a stated commission, although the price of the security    
usually includes a profit to the dealer. The Fund also expects that securities  
will be purchased at times in underwritten offerings where the price includes a 
fixed amount of compensation, generally referred to as the underwriter's        
concession or discount. On occasion, the Fund may also purchase certain money   
market instruments directly from an issuer, in which case no commissions or     
discounts are paid.                                                             

 During the fiscal years ended October 31, 1996, 1997 and 1998, the Fund
paid no brokerage commissions.                                                  

B. COMMISSIONS                                                                  

Pursuant to an order of the SEC, the Fund may effect principal        
transactions in certain money market instruments with Dean Witter Reynolds. The 
Fund will limit its transactions with Dean Witter Reynolds to U.S. Government   
and government agency securities, bank money instruments (i.e., certificates of 
deposit and bankers' acceptances) and commercial paper. The transactions will   
be effected with Dean Witter Reynolds only when the price available from Dean   
Witter Reynolds is better than that available from other dealers.               

 During the fiscal years ended January 31, 1997, 1998 and 1999, the Fund
did not effect any principal transactions with Dean Witter Reynolds.            

Consistent with the policy described above, brokerage transactions in 
securities listed on exchanges or admitted to unlisted trading privileges may   
be effected through Dean Witter Reynolds, Morgan Stanley & Co. and other        
affiliated brokers and dealers. In order for an affiliated broker or dealer to  
effect any portfolio transactions on an exchange for the Fund, the commissions, 
fees or other remuneration received by the affiliated broker or dealer must be  
reasonable and fair compared to the commissions, fees or other remuneration     
paid to other brokers in connection with comparable transactions involving      
similar securities being purchased or sold on an exchange during a comparable   
period of time. This standard would allow the affiliated broker or dealer to    
receive no more than the remuneration which would be expected to be received by 
an unaffiliated broker in a commensurate arm's-length transaction. Furthermore, 
the Trustees, including the Independent Trustees, have adopted procedures which 
are reasonably designed to provide that any commissions, fees or other          
remuneration paid to an affiliated broker or dealer are consistent with the     
foregoing standard. The Fund does not reduce the management fee it pays to the  
Investment Manager by any amount of the brokerage commissions it may pay to an  
affiliated broker or dealer.                                                    

C. BROKERAGE SELECTION                                                          

    The policy of the Fund regarding purchases and sales of securities for its
portfolio is that primary consideration will be given to obtaining the most     
favorable prices and efficient executions of transactions.                      

 In seeking to implement the Fund's policies, the Investment Manager and
the Sub-Advisor effect transactions with those brokers and dealers who the      
Investment Manager and/or Sub-Advisor believes provide the most favorable       
prices and are capable of providing efficient executions. If the Investment     
Manager and/or Sub-Advisor believes the prices and executions are obtainable    
from more than one broker or dealer, it may give consideration to placing       
portfolio transactions with those brokers and                                   

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dealers who also furnish research and other services to the Fund or the         
Investment Manager and the Sub-Advisor. The services may include, but are not   
limited to, any one or more of the following: information as to the             
availability of securities for purchase or sale; statistical or factual         
information or opinions pertaining to investment; wire services; and appraisals 
or evaluations of portfolio securities. The information and services received   
by the Investment Manager and/or Sub-Advisor from brokers and dealers may be of 
benefit to the Investment Manager and/or Sub-Advisor in the management of       
accounts of some of their other clients and may not in all cases benefit the    
Fund directly.                                                                  

  The Investment Manager and the Sub-Advisor currently serve as investment
advisors to a number of clients, including other investment companies, and may  
in the future act as investment manager or advisor to others. It is the         
practice of the Investment Manager and the Sub-Advisor to cause purchase and    
sale transactions to be allocated among the Fund and others whose assets they   
manage in such manner as they deem equitable. In making such allocations among  
the Fund and other client accounts, various factors may be considered,          
including the respective investment objectives, the relative size of portfolio  
holdings of the same or comparable securities, the availability of cash for     
investment, the size of investment commitments generally held and the opinions  
of the persons responsible for managing the portfolios of the Fund and other    
client accounts. In the case of certain initial and secondary public offerings, 
the Investment Manager utilizes a pro rata allocation process based on the size 
of the funds involved and the number of shares available from the public        
offering.                                                                       

D. DIRECTED BROKERAGE                                                           

 During the fiscal year ended October 31, 1998, the Fund did not pay any
brokerage commissions to brokers because of research services provided.         

E. REGULAR BROKER-DEALERS                                                       

  During the fiscal year ended October 31, 1998, the Fund did not purchase
securities issued by brokers or dealers that were among the ten brokers or the  
ten dealers that executed transactions for or with the Fund in the largest      
dollar amounts during the year.                                                 

VII. CAPITAL STOCK AND OTHER SECURITIES                                         
--------------------------------------------------------------------------------

The shareholders of the Fund are entitled to a full vote for each full
share of beneficial interest held. The Fund is authorized to issue an unlimited 
number of shares of beneficial interest. All shares of beneficial interest of   
the Fund are of $0.01 par value and are equal as to earnings, assets and voting 
privileges.                                                                     

The Fund's Declaration of Trust permits the Trustees to authorize the 
creation of additional series of shares (the proceeds of which would be         
invested in separate, independently managed portfolios) and additional Classes  
of shares within any series. The Trustees have not presently authorized any     
such additional series or Classes of shares other than as set forth in the      
Prospectus.                                                                     

 The Fund is not required to hold annual meetings of shareholders and in
ordinary circumstances the Fund does not intend to hold such meetings. The      
Trustees may call special meetings of shareholders for action by shareholder    
vote as may be required by the Investment Company Act or the Declaration of     
Trust. Under certain circumstances, the Trustees may be removed by action of    
the Trustees or by the shareholders.                                            

Under Massachusetts law, shareholders of a business trust may, under  
certain limited circumstances, be held personally liable as partners for the    
obligations of the Fund. However, the Declaration of Trust contains an express  
disclaimer of shareholder liability for acts or obligations of the Fund,        
requires that notice of such Fund obligations include such disclaimer, and      
provides for indemnification out of the Fund's property for any shareholder     
held personally liable for the obligations of the Fund. Thus, the risk of a     
shareholder incurring financial loss on account of shareholder liability is     
limited to circumstances in which the Fund itself would be unable to meet its   
obligations. Given the above limitations on shareholder personal liability, and 
the nature of the Fund's assets and operations, the possibility of the Fund     
being unable to meet its obligations is remote and thus, in the opinion of      
Massachusetts counsel to the Fund, the risk to Fund shareholders of personal    
liability is remote.                                                            

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All of the Trustees have been elected by the shareholders of the Fund,
most recently at a Special Meeting of Shareholders held on June 8, 1999. The    
Trustees themselves have the power to alter the number and the terms of office  
of the Trustees (as provided for in the Declaration of Trust), and they may at  
any time lengthen or shorten their own terms or make their terms of unlimited   
duration and appoint their own successors, provided that always at least a      
majority of the Trustees has been elected by the shareholders of the Fund.      

VIII. PURCHASE, REDEMPTION AND PRICING OF SHARES                                
--------------------------------------------------------------------------------

A. PURCHASE/REDEMPTION OF SHARES                                                

   Information concerning how Fund shares are offered to the public (and how
they are redeemed and exchanged) is provided in the Fund's Prospectus.          

  TRANSFER AGENT AS AGENT. With respect to the redemption or repurchase of
Fund shares, the application of proceeds to the purchase of new shares in the   
Fund or any other Morgan Stanley Dean Witter Fund and the general               
administration of the exchange privilege, the Transfer Agent acts as agent for  
the Distributor and for the shareholder's authorized broker-dealer, if any, in  
the performance of such functions. With respect to exchanges, redemptions or    
repurchases, the Transfer Agent shall be liable for its own negligence and not  
for the default or negligence of its correspondents or for losses in transit.   
The Fund shall not be liable for any default or negligence of the Transfer      
Agent, the Distributor or any authorized broker-dealer.                         

The Distributor and any authorized broker-dealer have appointed the   
Transfer Agent to act as their agent in connection with the application of      
proceeds of any redemption of Fund shares to the purchase of shares of any      
other continuously offered Morgan Stanley Dean Witter Fund and the general      
administration of the exchange privilege. No commission or discounts will be    
paid to the Distributor or any authorized broker-dealer for any transaction     
pursuant to the exchange privilege.                                             

B. OFFERING PRICE                                                               

   The price of Fund shares, called "net asset value," is based on the value
of the Fund's portfolio securities. Net asset value per share of each Class is  
calculated by dividing the value of the portion of the Fund's securities and    
other assets, less the liabilities by the number of shares outstanding.         

   In the calculation of the Fund's net asset value all portfolio securities
for which over-the-counter market quotations are readily available are valued   
at the latest bid price. When market quotations are not readily available,      
including circumstances under which it is determined by the Investment Manager  
or the Sub-Advisor that sale or bid prices are not reflective of a security's   
market value, portfolio securities are valued at their fair value as determined 
in good faith under procedures established by and under the general supervision 
of the Fund's Trustees. For valuation purposes, quotations of foreign portfolio 
securities, other assets and liabilities and forward contracts stated in        
foreign currency are translated into U.S. dollar equivalents at the prevailing  
market rates prior to the close of the New York Stock Exchange.                 

    Short-term debt securities with remaining maturities of sixty days or less
at the time of purchase are valued at amortized cost, unless the Trustees       
determine such does not reflect the securities' market value, in which case     
these securities will be valued at their fair value as determined by the        
Trustees.                                                                       

Certain of the Fund's portfolio securities may be valued by an outside
pricing service approved by the Fund's Trustees. The pricing service may        
utilize a matrix system incorporating security quality, maturity and coupon as  
the evaluation model parameters, and/or research evaluations by its staff,      
including review of broker-dealer market price quotations in determining what   
it believes is the fair valuation of the portfolio securities valued by such    
pricing service.                                                                

    Generally, trading in foreign securities, as well as corporate bonds, U.S.
Government securities and money market instruments, is substantially completed  
each day at various times prior to the close of the New York Stock Exchange.    
The values of such securities used in computing the net asset value of the      
Fund's shares are determined as of such times. Foreign currency exchange rates  
are also generally determined prior to the close of the New York Stock          
Exchange. Occasionally, events which may affect                                 

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the values of such securities and such exchange rates may occur between the     
times at which they are determined and the close of the New York Stock Exchange 
and will therefore not be reflected in the computation of the Fund's net asset  
value. If events that may affect the value of such securities occur during such 
period, then these securities may be valued at their fair value as determined   
in good faith under procedures established by and under the supervision of the  
Trustees.                                                                       

IX. TAXATION OF THE FUND AND SHAREHOLDERS                                       
--------------------------------------------------------------------------------

 The Fund generally will make two basic types of distributions: ordinary
dividends and long-term capital gain distributions. These two types of          
distributions are reported differently on a shareholder's income tax return and 
they are also subject to different rates of tax. The tax treatment of the       
investment activities of the Fund will affect the amount and timing and         
character of the distributions made by the Fund. Tax issues relating to the     
Fund are not generally a consideration for shareholders such as tax exempt      
entities and tax-advantaged retirement vehicles such as an IRA or 401(k) plan.  
Shareholders are urged to consult their own tax professionals regarding         
specific questions as to federal, state or local taxes.                         

INVESTMENT COMPANY TAXATION. The Fund intends to remain qualified as a
regulated investment company under Subchapter M of the Internal Revenue Code of 
1986. As such, the Fund will not be subject to federal income tax on its net    
investment income and capital gains, if any, to the extent that it distributes  
such income and capital gains to its shareholders.                              

 The Fund generally intends to distribute sufficient income and gains so
that the Fund will not pay corporate income tax on its earnings. The Fund also  
generally intends to distribute to its shareholders in each calendar year a     
sufficient amount of ordinary income and capital gains to avoid the imposition  
of a 4% excise tax. However, the Fund may instead determine to retain all or    
part of any net long-term capital gains in any year for reinvestment. In such   
event, the Fund will pay federal income tax (and possibly excise tax) on such   
retained gains.                                                                 

Gains or losses on sales of securities by the Fund will be long-term  
capital gains or losses if the securities have a tax holding period of more     
than one year. Gains or losses on the sale of securities with a tax holding     
period of one year or less will be short-term gains or losses.                  

  Under certain tax rules, the Fund may be required to accrue a portion of
any discount at which certain securities are purchased as income each year even 
though the Fund receives no payments in cash on the security during the year.   
To the extent that the Fund invests in such securities, it would be required to 
pay out such accrued discount as an income distribution in each year in order   
to avoid taxation at the Fund level. Such distributions will be made from the   
available cash of the Fund or by liquidation of portfolio securities if         
necessary. If a distribution of cash necessitates the liquidation of portfolio  
securities, the Investment Manager and/or Sub-Advisor will select which         
securities to sell. The Fund may realize a gain or loss from such sales. In the 
event the Fund realizes net capital gains from such transactions, its           
shareholders may receive a larger capital gain distribution, if any, than they  
would in the absence of such transactions.                                      

  TAXATION OF DIVIDENDS AND DISTRIBUTIONS. Shareholders normally will have
to pay federal income taxes, and any state and/or local income taxes, on the    
dividends and other distributions they receive from the Fund. Such dividends    
and distributions, to the extent that they are derived from net investment      
income or short-term capital gains, are taxable to the shareholder as ordinary  
income regardless of whether the shareholder receives such payments in          
additional shares or in cash.                                                   

Distributions of net long-term capital gains, if any, are taxable to  
shareholders as long-term capital gains regardless of how long a shareholder    
has held the Fund's shares and regardless of whether the distribution is        
received in additional shares or in cash. The Taxpayer Relief Act of 1997       
reduced the maximum tax on long-term capital gains applicable to individuals    
from 28% to 20%.                                                                

   Shareholders are generally taxed on any ordinary dividend or capital gain
distributions from the Fund in the year they are actually distributed. However, 
if any such dividends or distributions are declared in October, November or     
December and paid in January then such amounts will be treated for tax purposes 
as received by the shareholders on December 31, to shareholders of record of    
such month.                                                                     

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    Subject to certain exceptions, a corporate shareholder may be eligible for
a 70% dividends received deduction to the extent that the Fund earns and        
distributes qualifying dividends from its investments. Distributions of net     
capital gains by the Fund will not be eligible for the dividends received       
deduction.                                                                      

 Shareholders who are not citizens or residents of the United States and
certain foreign entities may be subject to withholding of United States tax on  
distributions made by the Fund of investment income and short term capital      
gains.                                                                          

After the end of each calendar year, shareholders will be sent full   
information on their dividends and capital gain distributions for tax purposes, 
including the portion taxable as ordinary income, the portion taxable as        
long-term capital gains and the amount of any dividends eligible for the        
federal dividends received deduction for corporations.                          

 PURCHASES AND REDEMPTIONS AND EXCHANGES OF FUND SHARES. Any dividend or
capital gains distribution received by a shareholder from any investment        
company will have the effect of reducing the net asset value of the             
shareholder's stock in that company by the exact amount of the dividend or      
capital gains distribution. Furthermore, such dividends and capital gains       
distributions are subject to federal income taxes. If the net asset value of    
the shares should be reduced below a shareholder's cost as a result of the      
payment of dividends or the distribution of realized long-term capital gains,   
such payment or distribution would be in part a return of the shareholder's     
investment but nonetheless would be taxable to the shareholder. Therefore, an   
investor should consider the tax implications of purchasing Fund shares         
immediately prior to a distribution record date.                                

In general, a sale of shares results in capital gain or loss, and for 
individual shareholders, is taxable at a federal rate dependent upon the length 
of time the shares were held. A redemption of a shareholder's Fund shares is    
normally treated as a sale for tax purposes. Fund shares held for a period of   
one year or less will, for tax purposes, generally result in short-term gains   
or losses and those held for more than one year generally result in long-term   
gain or loss. Any loss realized by shareholders upon a redemption of shares     
within six months of the date of their purchase will be treated as a long-term  
capital loss to the extent of any distributions of net long-term capital gains  
with respect to such shares during the six-month period.                        

  Gain or loss on the sale or redemption of shares in the Fund is measured
by the difference between the amount received and the tax basis of the shares.  
Shareholders should keep records of investments made (including shares acquired 
through reinvestment of dividends and distributions) so they can compute the    
tax basis of their shares. Under certain circumstances a shareholder may        
compute and use an average cost basis in determining the gain or loss on the    
sale or redemption of shares.                                                   

Exchanges of Fund shares for shares of any other continuously offered 
Morgan Stanley Dean Witter Fund are also subject to similar tax treatment. Such 
an exchange is treated for tax purposes as a sale of the original shares in the 
first fund, followed by the purchase of shares in the second fund.              

    If a shareholder realizes a loss on the redemption or exchange of a fund's
shares and reinvests in that fund's shares within 30 days before or after the   
redemption or exchange, the transactions may be subject to the "wash sale"      
rules, resulting in a postponement of the recognition of such loss for tax      
purposes.                                                                       

X. UNDERWRITERS                                                                 
--------------------------------------------------------------------------------

The Fund's shares are offered to the public on a continuous basis. The
Distributor, as the principal underwriter of the shares, has certain            
obligations under the Distribution Agreement concerning the distribution of the 
shares. These obligations and the compensation the Distributor receives are     
described above in the sections titled "Principal Underwriter" and "Rule 12b-1  
Plans".                                                                         

XI. CALCULATION OF PERFORMANCE DATA                                             
--------------------------------------------------------------------------------

    From time to time the Fund may quote its "yield" and/or its "total return"
in advertisements and sales literature.                                         

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Yield is calculated for any 30-day period as follows: the amount of   
interest income for each security in the Fund's portfolio is determined as      
described below; the total for the entire portfolio constitutes the Fund's      
gross income for the period. Expenses accrued during the period are subtracted  
to arrive at "net investment income." The resulting amount is divided by the    
product of the maximum offering price per share on the last day of the period   
(reduced by any undeclared earned income per share that is expected to be       
declared shortly after the end of the period) multiplied by the average number  
of Fund shares outstanding during the period that were entitled to dividends.   
This amount is added to 1 and raised to the sixth power. 1 is then subtracted   
from the result and the difference is multiplied by 2 to arrive at the          
annualized yield.                                                               

  To determine interest income from debt obligations, a yield-to-maturity,
expressed as a percentage, is determined for obligations held at the beginning  
of the period, based on the current market value of the security plus accrued   
interest, generally as of the end of the month preceding the 30-day period, or, 
for obligations purchased during the period, based on the cost of the security  
(including accrued interest). The yield-to-maturity is multiplied by the market 
value (plus accrued interest) for each security and the result is divided by    
360 and multiplied by 30 days or the number of days the security was held       
during the period, if less. Modifications are made for determining              
yield-to-maturity on certain tax-exempt securities. For the 30-day period ended 
October 31, 1998, the Fund's yield, calculated pursuant to the formula          
described above was 8.95%.                                                      

 The Fund's "average annual total return" represents an annualization of
the Fund's total return over a particular period and is computed by finding the 
annual percentage rate which will result in the ending redeemable value of a    
hypothetical $1,000 investment made at the beginning of a one, five or ten year 
period, or for the period from the date of commencement of the Fund's           
operations, if shorter than any of the foregoing. For the purpose of this       
calculation, it is assumed that all dividends and distributions are reinvested. 
The formula for computing the average annual total return involves a percentage 
obtained by dividing the ending redeemable value by the amount of the initial   
investment (which is reduced by the initial sales charge), taking a root of the 
quotient (where the root is equivalent to the number of years in the period)    
and subtracting 1 from the result. The average annual total return of the Fund  
for the fiscal year ended October 31, 1998 and for the period July 31, 1992     
(commencement of operations) through October 31, 1998 was 5.13% and 4.13%,      
respectively.                                                                   

    In addition, the Fund may compute its aggregate total return for specified
periods by determining the aggregate percentage rate which will result in the   
ending value of a hypothetical $1,000 investment made at the beginning of the   
period. For the purpose of this calculation, it is assumed that all dividends   
and distributions are reinvested. The formula for computing aggregate total     
return involves a percentage obtained by dividing the ending value (without     
reduction for any sales charge) by the initial $1,000 investment and            
subtracting 1 from the result. Based on the foregoing calculation, the Fund's   
total return for the fiscal year ended October 31, 1998 and for the period July 
31, 1992 (commencement of operations) through October 31, 1998 was 5.13% and    
28.81%, respectively.                                                           

The Fund may also advertise the growth of hypothetical investments of 
$10,000, $50,000 and $100,000 in shares of the Fund by adding 1 to the Fund's   
aggregate total return to date and multiplying $10,000, $50,000 or $100,000.    
Investments of $10,000, $50,000 and $100,000 in the Fund since inception would  
have grown to $12,881, $64,405, and $128,810, respectively, at October 31,      
1998.                                                                           

   The Fund from time to time may also advertise its performance relative to
certain performance rankings and indexes compiled by independent organizations. 

XII. FINANCIAL STATEMENTS                                                       
--------------------------------------------------------------------------------

 EXPERTS. The financial statements of the Fund for the fiscal year ended
Ocrober 31, 1998 included in this Statement of Additional Information and       
incorporated by reference in the Prospectus have been so included and           
incorporated in reliance on the report of                                    ,  
independent accountants, given on the authority of said firm as experts in      
auditing and accounting.                                                        

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 * * * * *

    This Statement of Additional Information and the Prospectus do not contain
all of the information set forth in the Registration Statement the Fund has     
filed with the SEC. The complete Registration Statement may be obtained from    
the SEC.                                                                        

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 TCW/DW NORTH AMERICAN GOVERNMENT INCOME TRUST

PART C OTHER INFORMATION

Item 23. Exhibits                                                               

        2. Amended and Restated By-Laws of the Registrant dated May 1, 1999.

14. Financial Data Schedule - To be filed by Amendment.       

All other exhibits were previously filed via EDGAR and are hereby incorporated  
by reference.                                                                   

Item 24. Persons Controlled by or Under Common Control With the Fund            

None                                                          

Item 25. Indemnification.                                     

    Pursuant to Section 5.3 of the Registrant's Declaration of Trust and under
Section 4.8 of the Registrant's By-Laws, the indemnification of the Registrant's
trustees, officers, employees and agents is permitted if it is determined that  
they acted under the belief that their actions were in or not opposed to the    
best interest of the Registrant, and, with respect to any criminal proceeding,  
they had reasonable cause to believe their conduct was not unlawful. In         
addition, indemnification is permitted only if it is determined that the actions
in question did not render them liable by reason of willful misfeasance, bad    
faith or gross negligence in the performance of their duties or by reason of    
reckless disregard of their obligations and duties to the Registrant. Trustees, 
officers, employees and agents will be indemnified for the expense of litigation
if it is determined that they are entitled to indemnification against any       
liability established in such litigation. The Registrant may also advance money 
for these expenses provided that they give their undertakings to repay the      
Registrant unless their conduct is later determined to permit indemnification.  

              Pursuant to Section 5.2 of the Registrant's Declaration of
Trust and paragraph 8 of the Registrant's Management and Advisory Agreements,   
none of the Manager, the Adviser or any trustee, officer, employee or agent of  
the Registrant shall be liable for any action or failure to act, except in the  
case of bad faith, willful misfeasance, gross negligence or reckless disregard  
of duties to the Registrant.                                                    

                Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") may be permitted to trustees, officers and   
controlling persons of the Registrant pursuant to the foregoing provisions or   
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as        
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the     
Registrant of expenses incurred or paid by a trustee, officer, or controlling   
person of the Registrant in connection with the successful defense of any       
action, suit or proceeding) is asserted against the Registrant by such trustee, 
officer or controlling person in connection with the shares being registered,   
the Registrant will, unless in the opinion of its counsel the matter has been   
settled by controlling precedent, submit to a court of appropriate jurisdiction 
the question whether such indemnification by it is against public policy as     
expressed in the Act, and will be governed by the final adjudication of such    
issue.                                                                          

           The Registrant hereby undertakes that it will apply the
indemnification provision of its by-laws in a manner consistent with Release    
11330 of the Securities and Exchange Commission under the                       

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Investment Company Act of 1940, so long as the interpretation of Sections 17(h) 
and 17(i) of such Act remains in effect.                                        

         Registrant, in conjunction with the Manager, Registrant's Trustees, and
other registered investment management companies managed by the Manager,        
maintains insurance on behalf of any person who is or was a Trustee, officer,   
employee, or agent of Registrant, or who is or was serving at the request of    
Registrant as a trustee, director, officer, employee or agent of another trust  
or corporation, against any liability asserted against him and incurred by him  
or arising out of his position. However, in no event will Registrant maintain   
insurance to indemnify any such person for any act for which Registrant itself  
is not permitted to indemnify him.                                              

Item 26. Business and Other Connections of Investment Adviser.                  

        The TCW Funds Management, Inc. ("TCW") is a 100% owned subsidiary of The
TCW Group, Inc., a Nevada corporation. TCW presently serves as investment       
adviser to: (1) TCW/DW North American Government Income Trust, an open-end,     
non-diversified management company; (2) TCW/DW Income and Growth Fund, an       
open-end, non-diversified management company; (3) TCW/DW Latin American Growth  
Fund, an open-end, non-diversified management company; (4) TCW/DW Small Cap     
Growth Fund, an open-end non-diversified management company; (5) TCW/DW Term    
Trust 2000, a closed-end, diversified management company; (6) TCW/DW Term Trust 
2002, a closed-end diversified management company; (7) TCW/DW Term Trust 2003, a
closed-end diversified management company; (8) TCW/DW Emerging Markets          
Opportunities Trust, an open-end, non-diversified management company; (9) TCW/DW
Total Return Trust, an open-end non-diversified management investment company;  
(10) TCW/DW Mid-Cap Equity Trust, an open-end, diversified management investment
company; and (11) TCW/DW Global Telecom Trust, an open-end diversified          
management investment company. TCW also serves as investment adviser or         
sub-adviser to other investment companies, including foreign investment         
companies. The list required by this Item 26 of the officers and directors of   
TCW together with information as to any other business, profession, vocation or 
employment of a substantive nature engaged in by TCW and such officers and      
directors during the past two years, is incorporated by reference to Form ADV   
(File No. 801-29075) filed by TCW pursuant to the Investment Advisers Act.      

Item 27. Principal Underwriters                                                 

(a)  Morgan Stanley Dean Witter Distributors Inc. ("MSDW Distributors"), a      
Delaware corporation, is the principal underwriter of the Registrant. 
MSDW Distributors is also the principal underwriter of the following  
investment companies:                                                 

(1)     Active Assets California Tax-Free Trust                                 
(2)     Active Assets Government Securities Trust                               
(3)     Active Assets Money Trust                                               
(4)     Active Assets Tax-Free Trust                                            
(5)     Morgan Stanley Dean Witter Aggressive Equity Fund                       
(6)     Morgan Stanley Dean Witter American Opportunities Fund                  
(7)     Morgan Stanley Dean Witter Balanced Growth Fund                         
(8)     Morgan Stanley Dean Witter Balanced Income Fund                         
(9)     Morgan Stanley Dean Witter California Tax-Free Daily Income Trust       
(10)    Morgan Stanley Dean Witter California Tax-Free Income Fund              
(11)    Morgan Stanley Dean Witter Capital Growth Securities                    

2 

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(12)    Morgan Stanley Dean Witter Competitive Edge Fund, "Best Ideas Portfolio"
(13)    Morgan Stanley Dean Witter Convertible Securities Trust                 
(14)    Morgan Stanley Dean Witter Developing Growth Securities Trust           
(15)    Morgan Stanley Dean Witter Diversified Income Trust                     
(16)    Morgan Stanley Dean Witter Dividend Growth Securities Inc.              
(17)    Morgan Stanley Dean Witter Equity Fund                                  
(18)    Morgan Stanley Dean Witter European Growth Fund Inc.                    
(19)    Morgan Stanley Dean Witter Federal Securities Trust                     
(20)    Morgan Stanley Dean Witter Financial Services Trust                     
(21)    Morgan Stanley Dean Witter Fund of Funds                                
(22)    Morgan Stanley Dean Witter Global Dividend Growth Securities            
(23)    Morgan Stanley Dean Witter Global Utilities Fund                        
(24)    Morgan Stanley Dean Witter Growth Fund                                  
(25)    Morgan Stanley Dean Witter Hawaii Municipal Trust                       
(26)    Morgan Stanley Dean Witter Health Sciences Trust                        
(27)    Morgan Stanley Dean Witter High Yield Securities Inc.                   
(28)    Morgan Stanley Dean Witter Income Builder Fund                          
(29)    Morgan Stanley Dean Witter Information Fund                             
(30)    Morgan Stanley Dean Witter Intermediate Income Securities               
(31)    Morgan Stanley Dean Witter International SmallCap Fund                  
(32)    Morgan Stanley Dean Witter Japan Fund                                   
(33)    Morgan Stanley Dean Witter Limited Term Municipal Trust                 
(34)    Morgan Stanley Dean Witter Liquid Asset Fund Inc.                       
(35)    Morgan Stanley Dean Witter Market Leader Trust                          
(36)    Morgan Stanley Dean Witter Mid-Cap Dividend Growth Securities           
(37)    Morgan Stanley Dean Witter Mid-Cap Growth Fund                          
(38)    Morgan Stanley Dean Witter Multi-State Municipal Series Trust           
(39)    Morgan Stanley Dean Witter Natural Resource Development Securities Inc. 
(40)    Morgan Stanley Dean Witter New York Municipal Money Market Trust        
(41)    Morgan Stanley Dean Witter New York Tax-Free Income Fund                
(42)    Morgan Stanley Dean Witter Pacific Growth Fund Inc.                     
(43)    Morgan Stanley Dean Witter Precious Metals and Minerals Trust           
(44)    Morgan Stanley Dean Witter Prime Income Trust                           
(45)    Morgan Stanley Dean Witter Real Estate Fund                             
(46)    Morgan Stanley Dean Witter S&P 500 Index Fund                           
(47)    Morgan Stanley Dean Witter S&P 500 Select Fund                          
(48)    Morgan Stanley Dean Witter Short-Term Bond Fund                         
(49)    Morgan Stanley Dean Witter Short-Term U.S. Treasury Trust               
(50)    Morgan Stanley Dean Witter Special Value Fund                           
(51)    Morgan Stanley Dean Witter Strategist Fund                              
(52)    Morgan Stanley Dean Witter Tax-Exempt Securities Trust                  
(53)    Morgan Stanley Dean Witter Tax-Free Daily Income Trust                  
(54)    Morgan Stanley Dean Witter U.S. Government Money Market Trust           
(55)    Morgan Stanley Dean Witter U.S. Government Securities Trust             
(56)    Morgan Stanley Dean Witter Utilities Fund                               
(57)    Morgan Stanley Dean Witter Value-Added Market Series                    
(58)    Morgan Stanley Dean Witter Value Fund                                   
(59)    Morgan Stanley Dean Witter Variable Investment Series                   
(60)    Morgan Stanley Dean Witter World Wide Income Trust                      
(1)     TCW/DW Emerging Markets Opportunities Trust                             

3 

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(2)     TCW/DW Global Telecom Trust                                             
(3)     TCW/DW Income and Growth                                                
(4)     TCW/DW Latin American Growth Fund                                       
(5)     TCW/DW Mid-Cap Equity Trust                                             
(6)     TCW/DW North American Government Income Trust                           
(7)     TCW/DW Small Cap Growth Fund                                            
(8)     TCW/DW Total Return Trust                                               

(b) The following information is given regarding directors and officers of MSDW 
Distributors not listed in Item 26 above. The principal address of MSDW 
Distributors is Two World Trade Center, New York, New York 10048.       

                             POSITION AND OFFICE WITH DISTRIBUTORS
NAME                                AND THE REGISTRANT                          
----                                ------------------------------------------- 
Mitchell M. Merin                   Chairman, Chief Executive Officer and       
                                   Director of MSDW Distributors and President
          of the Registrant.

Christine A. Edwards                Executive Vice President, Secretary,        
                                Director and Chief Legal Officer of MSDW
     Distributors.

Philip J. Purcell                   Director of MSDW Distributors.              

James F. Higgins                    Director of MSDW Distributors.              

John Schaeffer                      Director of MSDW Distributors.              

John B. Kemp III                    President of MSDW Distributors.             

Robert S. Giambrone                 Senior Vice President of MSDW Distributors  
                             and Vice President of the Registrant.

Barry Fink                          Senior Vice President, Assistant General    
                               Counsel and Assistant Secretary of MSDW
                                  Distributors and Vice President, Secretary
                              and General Counsel of the Registrant.

Frederick K. Kubler                 Senior Vice President, Assistant Secretary  
                            and Chief Compliance Officer of MSDW
     Distributors.

Charles Vidala                      Senior Vice President and Financial         
                       Principal of MSDW Distributors.

Michael T. Gregg                    Vice President and Assistant Secretary of   
          MSDW Distributors.

Thomas F. Caloia                    Assistant Treasurer of MSDW Distributors and
                    Treasurer of the Registrant.

Michael Interrante                  Assistant Treasurer of MSDW Distributors.   

4 

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Item 28. Location of Accounts and Records                                       

    All accounts, books and other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940 and the Rules thereunder are
maintained by the Investment Manager at its offices, except records relating to 
holders of shares issued by the Registrant, which are maintained by the         
Registrant's Transfer Agent, at its place of business as shown in the           
prospectus.                                                                     

Item 29. Management Services                                                    

Registrant is not a party to any such management-related service
contract.                                                                       

Item 30. Undertakings                                                           

None                                                            

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SIGNATURES

  Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it has duly caused
this Post-Effective Amendment to the Registration Statement to be signed on its 
behalf by the undersigned, thereunto duly authorized, in the City of New York   
and State of New York on the 26th day of April, 1999.                           

                                 TCW/DW NORTH AMERICAN GOVERNMENT INCOME TRUST

                    By: /s/ Barry Fink
                                          --------------------------------
                            Barry Fink
                                              Vice President and Secretary

Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment No. 8 has been signed below by the following persons in
the capacities and on the dates indicated.                                      

                                                                [Download Table]


        SIGNATURES                          TITLE                      DATE  
        ----------                          -----                      ----  
                                                                             
(1) Principal Executive Officer             Chief Executive Officer,         
                                            Trustee and Chairman      4/26/99
By: /s/ Charles A. Fiumefreddo                                               
        ------------------------------                                       
        Charles A. Fiumefreddo                                               

(2) Principal Financial Officer             Treasurer and Principal          
                                            Accounting Officer        4/26/99
 By: /s/ Thomas F. Caloia                                                    
        ------------------------------                                       
         Thomas F. Caloia                                                    

(3) Majority of the Trustees                                                 

    Charles A. Fiumefreddo (Chairman)                                        
    Thomas E. Larkin, Jr.                                                    
    Richard M. DeMartini                                                     
    Marc. I. Stern                                                           

 By: /s/ Barry Fink                                                   4/26/99
        ------------------------------                                       
         Barry Fink                                                          
         Attorney-in-Fact                                                    

    John C. Argue        Michael E. Nugent                                   
    Manuel H. Johnson    John L. Schroeder                                   

 By: /s/ David M. Butowsky                                            4/26/99
        ------------------------------                                       
         David M. Butowsky                                                   
         Attorney-in-Fact                                                    

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 TCW/DW NORTH AMERICAN GOVERNMENT INCOME TRUST
 EXHIBIT INDEX

        2. Amended and Restated By-Laws of the Registrant dated May 1, 1999.

14. Financial Data Schedule - To be filed by Amendment.       

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘485APOS’ Filing		Date		First		Last			Other Filings
		1/1/00		11		38
		6/25/99		1		47			NSAR-A
		6/8/99		44		53			DEFS14A,  PRES14A
		5/31/99		12		46
		5/1/99		58		64
Filed on:		4/26/99		1
		3/31/99		7
		3/29/99		1
		2/25/99		29		47
		1/31/99		51
		12/31/98		9		46
		11/30/98		49
		10/31/98		8		56			24F-2NT,  NSAR-B
		1/31/98		51
		11/30/97		49
		10/31/97		47		51			24F-2NT,  N-30D,  NSAR-B
		1/31/97		51
		11/30/96		49
		10/31/96		47		51			24F-2NT,  N-30D,  NSAR-B
		7/31/92		56
		2/19/92		29
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