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<SEC-DOCUMENT>0000950137-05-005421.txt : 20050505
<SEC-HEADER>0000950137-05-005421.hdr.sgml : 20050505
<ACCEPTANCE-DATETIME>20050505132734
ACCESSION NUMBER:		0000950137-05-005421
CONFORMED SUBMISSION TYPE:	N-14 8C/A
PUBLIC DOCUMENT COUNT:		25
FILED AS OF DATE:		20050505
DATE AS OF CHANGE:		20050505

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			VAN KAMPEN MUNICIPAL TRUST
		CENTRAL INDEX KEY:			0000877463
		IRS NUMBER:				363779776
		STATE OF INCORPORATION:			MA
		FISCAL YEAR END:			0831

	FILING VALUES:
		FORM TYPE:		N-14 8C/A
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-123451
		FILM NUMBER:		05802534

	BUSINESS ADDRESS:	
		STREET 1:		VAN KAMPEN INVESTMENTS INC.
		STREET 2:		1221 AVENUE OF THE AMERICAS
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10020
		BUSINESS PHONE:		2127625441

	MAIL ADDRESS:	
		STREET 1:		VAN KAMPEN INVESTMENTS INC.
		STREET 2:		1221 AVENUE OF THE AMERICAS
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10020

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	VAN KAMPEN AMERICAN CAPITAL MUNICIPAL TRUST
		DATE OF NAME CHANGE:	19960102

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	VAN KAMPEN MERRITT MUNICIPAL TRUST
		DATE OF NAME CHANGE:	19920929

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	VAN KAMPEN MERRITT QUALITY MUNICIPAL TRUST
		DATE OF NAME CHANGE:	19600201
</SEC-HEADER>
<DOCUMENT>
<TYPE>N-14 8C/A
<SEQUENCE>1
<FILENAME>c93084a1nv148cza.txt
<DESCRIPTION>PRE-EFFECTIVE AMENDMENT TO FORM N-14
<TEXT>
<PAGE>

     As filed with the Securities and Exchange Commission on May 5, 2005




                                              Securities Act File No. 333-123451

                                       Investment Company Act File No. 811-06362

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM N-14
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933


                        [x] PRE-EFFECTIVE AMENDMENT NO. 1


                       [ ] POST-EFFECTIVE AMENDMENT NO. _

                        (CHECK APPROPRIATE BOX OR BOXES)

                           VAN KAMPEN MUNICIPAL TRUST

         (EXACT NAME OF REGISTRANT AS SPECIFIED IN DECLARATION OF TRUST)


                                 (800) 341-2929
                        (AREA CODE AND TELEPHONE NUMBER)


                           1221 AVENUE OF THE AMERICAS
                            NEW YORK, NEW YORK 10020
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

                             AMY R. DOBERMAN, ESQ.
                                MANAGING DIRECTOR
                           VAN KAMPEN INVESTMENTS INC.
                           1221 AVENUE OF THE AMERICAS
                            NEW YORK, NEW YORK 10020
                     (NAME AND ADDRESS OF AGENT FOR SERVICE)

                                   COPIES TO:

                              WAYNE W. WHALEN, ESQ.
                             CHARLES B. TAYLOR, ESQ.
                    SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
                              333 WEST WACKER DRIVE
                             CHICAGO, ILLINOIS 60606
                                 (312) 407-0700

================================================================================
Approximate Date of Proposed:
As soon as practicable after this Registration Statement is declared effective.

<TABLE>
<CAPTION>
============================================================================================================================
                             CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933
- ----------------------------------------------------------------------------------------------------------------------------
          TITLE OF SECURITIES             AMOUNT BEING      PROPOSED MAXIMUM           PROPOSED             AMOUNT OF
           BEING REGISTERED                REGISTERED        OFFERING PRICE       MAXIMUM AGGREGATE     REGISTRATION FEE
                                                                PER UNIT            OFFERING PRICE
- --------------------------------------- ----------------- --------------------- ----------------------- --------------------
<S>                                     <C>               <C>                   <C>                     <C>
Common Shares ($0.01 par value)             3,440,119     $      14.15 (1)      $ 48,677,687            $ 5,729 (2)
- --------------------------------------- ----------------- --------------------- ----------------------- --------------------
Auction Preferred Shares ($0.01 par
value)                                          1,000     $      25,000         $ 25,000,000            $ 2,943 (2)
- --------------------------------------- ----------------- --------------------- ----------------------- --------------------
</TABLE>


(1) Average of high and low reported price for common shares on May 3, 2005.

(2) Includes registration fee of $117.70 previously paid in connection with the
initial filing of the Registration Statement.

         The Registrant hereby amends this registration statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.


<PAGE>



                                EXPLANATORY NOTE

This Registration Statement is organized as follows:

     o    Questions and Answers to Van Kampen Investment Grade Municipal Trust
          Shareholders

     o    Notice of Special Meeting of Shareholders of Van Kampen Investment
          Grade Municipal Trust

     o    Proxy Statement/Prospectus regarding the Proposed Reorganization
          of Van Kampen Investment Grade Municipal Trust into Van Kampen
          Municipal Trust

     o    Statement of Additional Information regarding the Reorganization of
          Van Kampen Investment Grade Municipal Trust into Van Kampen Municipal
          Trust

     o    Part C Information

     o    Exhibits



<PAGE>


                                --  MAY 2005  --

- --------------------------------------------------------------------------------
                                IMPORTANT NOTICE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
                    TO SHAREHOLDERS OF VAN KAMPEN INVESTMENT
                             GRADE MUNICIPAL TRUST
- --------------------------------------------------------------------------------

Questions & Answers

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

Although we recommend that you read the complete Proxy Statement/Prospectus, we
have provided for your convenience a brief overview of the issue to be voted on.

- ---------------------------------------
Q      WHY IS A SHAREHOLDER
       MEETING BEING HELD?

A      You are being asked to
vote on a reorganization (the "Reorganization") of Van Kampen Investment Grade
Municipal Trust (the "Target Fund") into Van Kampen Municipal Trust (the
"Acquiring Fund"), a closed-end investment company that pursues the same
investment objective and similar investment policies as the Target Fund.

Q      WHY IS THE REORGANIZATION
       BEING RECOMMENDED?

A      The Board of Trustees of the
Target Fund has determined that the Reorganization will benefit common
shareholders of the Target Fund. The Target Fund and the Acquiring Fund are
similar. Each Fund pursues the same investment objective to seek to provide a
high level of current income exempt from federal income tax consistent with
preservation of capital. Each Fund invests primarily in investment grade
municipal securities. After the Reorganization, it is anticipated that common
shareholders of the Target Fund will experience a reduced overall operating
expense ratio, as certain fixed administrative costs will be spread across the
combined larger asset base, while Target Fund shareholders remain invested in a
closed-end fund that has the same investment objective and similar investment
policies and is managed by the same investment advisory personnel. It is not
anticipated that the Reorganization will directly benefit holders of preferred
shares of the Target Fund; however, it is anticipated that the holders of
preferred shares of each Fund will not be adversely affected by the
Reorganization, and none of the expenses of the Reorganization will be borne by
preferred shareholders.

<PAGE>

Q      HOW WILL THE
       REORGANIZATION AFFECT ME?

A      Assuming shareholders of
the Target Fund approve the Reorganization, the assets and liabilities of the
Target Fund will be combined with those of the Acquiring Fund, you will become a
shareholder of the Acquiring Fund and the Target Fund will be dissolved. If you
are a holder of common shares of the Target Fund, you will receive newly-issued
common shares of the Acquiring Fund, and if you are a holder of preferred shares
of the Target Fund, you will receive newly-issued preferred shares of the
Acquiring Fund. The aggregate net asset value of the common shares you receive
in the Reorganization will equal the aggregate net asset value of the common
shares you own immediately prior to the Reorganization less the costs of the
Reorganization (though you may receive cash for fractional shares). The
aggregate liquidation preference of the preferred shares you receive in the
Reorganization will equal the aggregate liquidation preference of the preferred
shares you own immediately prior to the Reorganization. No certificates for
shares of the Acquiring Fund will be issued in connection with the
Reorganization, although such certificates will be available upon request.

Q      WILL I HAVE TO PAY ANY
       SALES LOAD, COMMISSION OR OTHER SIMILAR FEE IN CONNECTION WITH THE
       REORGANIZATION?
A      You will pay no sales loads
or commissions in connection with the Reorganization. However, if the
Reorganization is completed, the costs associated with the Reorganization,
including the costs associated with the shareholder meeting, will be borne by
the Target Fund and the Acquiring Fund in proportion to their projected declines
in total operating expenses as a consequence of the Reorganization.
Q      WILL I HAVE TO PAY ANY
       FEDERAL TAXES AS A RESULT OF THE REORGANIZATION?
A      The Reorganization is
intended to qualify as a "reorganization" within the meaning of Section
368(a)(1) of the Internal Revenue Code of 1986, as amended. If the
Reorganization so qualifies, in general, a shareholder of the Target Fund will
recognize no gain or loss upon the receipt solely of shares of the Acquiring
Fund in connection with the Reorganization. Additionally, the Target Fund will
not recognize any gain or loss as a result of the transfer of all of its assets
and liabilities solely in exchange for the shares of the Acquiring Fund or as a
result of its dissolution.
<PAGE>

       Neither the Acquiring Fund nor its shareholders will recognize any gain
or loss in connection with the Reorganization.
Q      HOW DO I VOTE MY PROXY?
A      You may cast your vote by
mail, phone or internet. To vote by mail, please mark your vote on the enclosed
proxy card and sign, date and return the card in the postage-paid envelope
provided. If you choose to vote via phone or internet, please refer to the
instructions found on the proxy card accompanying this Proxy
Statement/Prospectus. To vote by phone or internet, you will need the "control
number" that appears on the proxy card.
Q      HOW DOES THE BOARD OF
       TRUSTEES OF THE TARGET FUND SUGGEST I VOTE?
A      After careful consideration,
the Board of Trustees of the Target Fund recommend that you vote "FOR" the
Reorganization Agreement as described in the Proxy Statement/Prospectus.
Q      WHOM DO I CONTACT FOR
       FURTHER INFORMATION?

A      You can contact your
financial adviser for further information. You may also call Van Kampen's Client
Relations Department at (800) 341-2929 (Telecommunication Device for the Deaf
users may call (800) 421-2833) or visit our web site at www.vankampen.com where
you can send us an e-mail message by selecting "Contact Us."

<PAGE>

                              ABOUT THE PROXY CARD
- --------------------------------------------------------------------------------

Please vote on the proposed Reorganization using blue or black ink to mark an X
in one of the boxes provided on the proxy card.

Approval of Reorganization -- mark "For," "Against" or "Abstain."

Sign, date and return the proxy card in the enclosed postage-paid envelope. All
registered owners of an account, as shown in the address, must sign the card.
When signing as attorney, trustee, executor, administrator, custodian, guardian
or corporate officer, please indicate your full title.

<Table>
<C>  <S>

[ ]  PLEASE MARK
 X   VOTES AS IN
     THIS EXAMPLE
</Table>

                                VAN KAMPEN XXXXX

                        SPECIAL MEETING OF SHAREHOLDERS

 XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
 XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
 XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX


<Table>
<Caption>
                          FOR  AGAINST  ABSTAIN
<S>  <C>                  <C>  <C>      <C>      <C>    <C>
1.   The proposal to      [ ]    [ ]      [ ]      2.   To transact such other business as may
     approve the                                        properly come before the Meeting.
     Reorganization

     ----------------------------------
</Table>


Please be sure to sign and date this Proxy, Date

Shareholder sign here       Co-owner sign here

 XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
                   SAMPLE
<PAGE>

                                   VAN KAMPEN

                        INVESTMENT GRADE MUNICIPAL TRUST

                          1221 AVENUE OF THE AMERICAS
                            NEW YORK, NEW YORK 10020

                                 (800) 341-2929


                           NOTICE OF SPECIAL MEETING
                                OF SHAREHOLDERS

                          TO BE HELD ON JUNE 22, 2005


  Notice is hereby given that a special meeting of shareholders (the "Special
Meeting") of Van Kampen Investment Grade Municipal Trust (the "Target Fund")
will be held at the offices of Van Kampen Investments Inc., 1 Parkview Plaza,
Oakbrook Terrace, Illinois 60181-5555 on June 22, 2005 at 10:30 a.m. for the
following purposes:



    1. To approve an Agreement and Plan of Reorganization between the Target
       Fund and Van Kampen Municipal Trust (the "Acquiring Fund"), the
       termination of the Target Fund's registration under the Investment
       Company Act of 1940, as amended, and the dissolution of the Target Fund
       under applicable state law; and


    2. To transact such other business as may properly be presented at the
       Special Meeting or any adjournment thereof.

  Shareholders of record as of the close of business on April 25, 2005 are
entitled to vote at the Special Meeting or any adjournment thereof.


  THE BOARD OF TRUSTEES OF THE TARGET FUND REQUESTS THAT YOU VOTE YOUR SHARES BY
INDICATING YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD, DATING AND
SIGNING SUCH PROXY CARD AND RETURNING IT IN THE ENVELOPE PROVIDED, WHICH IS
ADDRESSED FOR YOUR CONVENIENCE AND NEEDS NO POSTAGE IF MAILED IN THE UNITED
STATES, OR BY RECORDING YOUR VOTING INSTRUCTIONS BY TELEPHONE OR VIA THE
INTERNET.


  THE BOARD OF TRUSTEES OF THE TARGET FUND RECOMMENDS THAT YOU CAST YOUR VOTE:


        FOR THE REORGANIZATION OF THE TARGET FUND PURSUANT TO THE AGREEMENT AND
    PLAN OF REORGANIZATION AS DESCRIBED IN THE PROXY STATEMENT/PROSPECTUS.

<PAGE>


  IN ORDER TO AVOID THE ADDITIONAL EXPENSE OF FURTHER SOLICITATION, WE ASK THAT
YOU MAIL YOUR PROXY CARD PROMPTLY OR RECORD YOUR VOTING INSTRUCTIONS BY
TELEPHONE OR VIA THE INTERNET.


                                       For the Board of Trustees,

                                       LOU ANNE MCINNIS
                                       Assistant Secretary
                                       Van Kampen Investment Grade Municipal
                                       Trust


May 6, 2005


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

                            YOUR VOTE IS IMPORTANT.
               PLEASE VOTE PROMPTLY BY SIGNING AND RETURNING THE

          ENCLOSED PROXY CARD OR BY RECORDING YOUR VOTING INSTRUCTIONS


      BY TELEPHONE OR VIA THE INTERNET NO MATTER HOW MANY SHARES YOU OWN.

<PAGE>

     The information in this Proxy Statement/Prospectus is not complete and may
     be changed. We may not sell these securities until the registration
     statement filed with the Securities and Exchange Commission is effective.
     This Proxy Statement/Prospectus is not an offer to sell these securities
     and is not soliciting an offer to buy these securities in any state where
     the offer or sale is not permitted.


                    SUBJECT TO COMPLETION, DATED MAY 5, 2005


                           PROXY STATEMENT/PROSPECTUS

                                   VAN KAMPEN
                        INVESTMENT GRADE MUNICIPAL TRUST

                          1221 AVENUE OF THE AMERICAS
                            NEW YORK, NEW YORK 10020

                                 (800) 341-2929


                        SPECIAL MEETING OF SHAREHOLDERS


                                 JUNE 22, 2005



  This Proxy Statement/Prospectus is furnished to you as a shareholder of Van
Kampen Investment Grade Municipal Trust (the "Target Fund"). A special meeting
of shareholders of the Target Fund (the "Special Meeting") will be held at the
offices of Van Kampen Investments Inc., 1 Parkview Plaza, Oakbrook Terrace,
Illinois 60181-5555 on June 22, 2005 at 10:30 a.m. to consider the items listed
below and discussed in greater detail elsewhere in this Proxy
Statement/Prospectus. If you are unable to attend the Special Meeting or any
adjournment thereof, the Board of Trustees of the Target Fund requests that you
vote your shares by completing and returning the enclosed proxy card or by
recording your voting instructions by telephone or via the internet. The
approximate mailing date of this Proxy Statement/Prospectus and accompanying
form of proxy is May 10, 2005.


  The purposes of the Special Meeting are:


    1. To approve an Agreement and Plan of Reorganization between the Target
       Fund and Van Kampen Municipal Trust (the "Acquiring Fund"), the
       termination of the Target Fund under the Investment Company Act of 1940,
       as amended (the "1940 Act"), and the dissolution of the Target Fund under
       applicable state law; and


    2. To transact such other business as may properly be presented at the
       Special Meeting or any adjournment thereof.


  The Target Fund and the Acquiring Fund are sometimes referred to herein each
as a "Fund" and collectively as the "Funds". The Reorganization Agreement that
Target Fund shareholders are being asked to consider involves a transaction that
will be referred to in this Proxy Statement/Prospectus as the "Reorganization."



  The Reorganization seeks to combine two similar funds to achieve certain
economies of scale and other operational efficiencies. Each Fund pursues the
same investment objective to seek to provide a high level of current income
exempt from

<PAGE>


federal income tax consistent with preservation of capital. Each Fund invests
primarily in investment grade municipal securities.



  In the Reorganization, the Acquiring Fund will acquire substantially all of
the assets and assume substantially all of the liabilities of the Target Fund in
exchange for an equal aggregate value of newly-issued common shares of
beneficial interest of the Acquiring Fund, par value $0.01 per share ("Acquiring
Fund Common Shares"), and newly-issued Series E auction preferred shares of the
Acquiring Fund with a par value of $0.01 per share and a liquidation preference
of $25,000 per share ("Acquiring Fund APS"). The Target Fund will distribute
Acquiring Fund Common Shares to holders of common shares of the Target Fund
("Target Fund Common Shares") and Acquiring Fund APS to holders of Remarketed
Preferred Shares of the Target Fund ("Target Fund RP"), and will then terminate
its registration under the 1940 Act, and dissolve under applicable state law.
The aggregate net asset value of Acquiring Fund Common Shares received in the
Reorganization will equal the aggregate net asset value of the Target Fund
Common Shares held immediately prior to the Reorganization less the costs of the
Reorganization (though holders of Target Fund Common Shares may receive cash for
their fractional shares). The aggregate liquidation preference of the Acquiring
Fund APS received in the Reorganization will equal the aggregate liquidation
preference of the Target Fund RP held immediately prior to the Reorganization.
The Acquiring Fund will continue to operate after the Reorganization as a
registered closed-end investment company with the investment objective and
policies described in this Proxy Statement/Prospectus. Acquiring Fund APS and
Target Fund RP are sometimes referred to herein collectively as "Preferred
Shares".



  In the event that Target Fund shareholders do not approve the Reorganization,
the Target Fund will continue to exist and the Board of Trustees of the Target
Fund will consider what additional action, if any, to take.



  This Proxy Statement/Prospectus sets forth concisely the information
shareholders of the Target Fund should know before voting on the Agreement and
Plan of Reorganization and constitutes an offering of Acquiring Fund Common
Shares and Acquiring Fund APS. Please read it carefully and retain it for future
reference. A Statement of Additional Information, dated May 6, 2005, relating to
this Proxy Statement/Prospectus (the "Reorganization Statement of Additional
Information") has been filed with the Securities and Exchange Commission (the
"SEC") and is incorporated herein by reference. If you wish to request the
Reorganization Statement of Additional Information, please ask for the
"Reorganization Statement of Additional Information." Copies of each Fund's most
recent annual report and semi-annual report can be obtained on a web site
maintained by Van Kampen Investments Inc. at www.vankampen.com. In addition,
each Fund will furnish, without charge, a copy of the Reorganization Statement
of Additional Information,


                                        2
<PAGE>


its most recent annual report and any more recent semi-annual report to any
shareholder upon request. Any such request should be directed to the Van Kampen
Client Relations Department by calling (800) 341-2929 (TDD users may call (800)
421-2833) or by writing to the respective Fund at 1 Parkview Plaza, P.O. Box
5555, Oakbrook Terrace, Illinois 60181-5555. The address of the principal
executive offices of the Funds is 1221 Avenue of the Americas, New York, New
York 10020, and the telephone number is (800) 341-2929.



  The Funds are subject to the informational requirements of the Securities
Exchange Act of 1934, as amended, and, in accordance therewith, file reports,
proxy statements, proxy material and other information with the SEC. Materials
filed with the SEC can be reviewed and copied at the SEC's Public Reference Room
at 450 Fifth Street, N.W., Washington, D.C. 20549 or downloaded from the SEC's
web site at www.sec.gov. Information on the operation of the SEC's Public
Reference Room may be obtained by calling the SEC at (202) 942-8090. You can
also request copies of these materials, upon payment at the prescribed rates of
a duplicating fee, by electronic request to the SEC's e-mail address
(publicinfo@sec.gov) or by writing the Public Reference Branch, Office of
Consumer Affairs and Information Services, SEC, Washington, DC, 20549-0102.



  The Acquiring Fund Common Shares are listed on the New York Stock Exchange
(the "NYSE") and the Chicago Stock Exchange (the "CHX") under the ticker symbol
"VKQ" and will continue to be so listed subsequent to the Reorganization. The
common shares of the Target Fund are listed on the NYSE and the CHX under the
ticker symbol "VIG." Reports, proxy statements and other information concerning
the Funds may be inspected at the offices of the NYSE, 20 Broad Street, New
York, New York 10005.


  This Proxy Statement/Prospectus serves as a prospectus of the Acquiring Fund
in connection with the issuance of the Acquiring Fund Common Shares and the
Acquiring Fund APS in the Reorganization. No person has been authorized to give
any information or make any representation not contained in this Proxy
Statement/ Prospectus and, if so given or made, such information or
representation must not be relied upon as having been authorized. This Proxy
Statement/Prospectus does not constitute an offer to sell or a solicitation of
an offer to buy any securities in any jurisdiction in which, or to any person to
whom, it is unlawful to make such offer or solicitation.

  The Board of Trustees of the Target Fund knows of no business other than that
discussed above that will be presented for consideration at the Special Meeting.
If any other matter is properly presented, it is the intention of the persons
named in the enclosed proxy to vote in accordance with their best judgment.

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

                                        3
<PAGE>

  THE SEC HAS NOT APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE
ADEQUACY OF THIS PROXY STATEMENT/PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.


  The date of this Proxy Statement/Prospectus is May 6, 2005.


                                        4
<PAGE>

                               TABLE OF CONTENTS


<Table>
<Caption>
                                                              PAGE
                                                              ----
<S>                                                           <C>
SUMMARY.....................................................    6
  The Proposed Reorganization...............................    6
  Background and Reasons for the Proposed Reorganization....    6
  Expenses..................................................    7
  Further Information Regarding the Reorganization..........   10
RISK FACTORS AND SPECIAL CONSIDERATIONS.....................   11
  Market Risk...............................................   11
  Interest Rate Risk........................................   12
  Credit Risk...............................................   12
  Income Risk...............................................   13
  Nonpayment Risk...........................................   13
  Call Risk.................................................   13
  Municipal Securities Risk.................................   13
  Risks of Using Strategic Transactions.....................   13
  Manager Risk..............................................   14
  Market Discount Risk......................................   14
  Leverage Risk.............................................   14
  Anti-Takeover Provisions..................................   16
  Special Risks Related to Preferred Shares.................   16
COMPARISON OF THE FUNDS.....................................   18
  Investment Objective and Policies.........................   18
  Other Investment Practices and Policies...................   22
  Investment Restrictions...................................   30
  Management of the Funds...................................   34
  Other Service Providers...................................   38
  Capitalization............................................   38
  Additional Information about Common Shares of the Funds...   40
  Additional Information about Preferred Shares of the
    Funds...................................................   43
  Governing Law.............................................   50
  Certain Provisions of the Declarations of Trust...........   50
  Conversion to Open-End Fund...............................   52
  Voting Rights.............................................   52
  Financial Highlights......................................   54
INFORMATION ABOUT THE REORGANIZATION........................   56
  General...................................................   56
  Terms of the Agreement and Plan of Reorganization.........   58
  Expenses of the Reorganization............................   59
  Material U.S. Federal Income Tax Consequences of the
    Reorganization..........................................   60
  Shareholder Approval......................................   62
OTHER INFORMATION...........................................   63
  Voting Information and Requirements.......................   63
  Shareholder Information...................................   64
  Section 16(a) Beneficial Ownership Reporting Compliance...   65
  Shareholder Proposals.....................................
  Solicitation of Proxies...................................   65
  Legal Matters.............................................   66
  Other Matters to Come Before the Meeting..................   66
EXHIBIT I: DESCRIPTION OF SECURITIES RATINGS................  I-1
</Table>


                                        5
<PAGE>

 ------------------------------------------------------------------------------
                                    SUMMARY
 ------------------------------------------------------------------------------

  The following is a summary of certain information contained elsewhere in this
Proxy Statement/Prospectus and is qualified in its entirety by reference to the
more complete information contained in this Proxy Statement/Prospectus and in
the Reorganization Statement of Additional Information. Shareholders should read
the entire Proxy Statement/Prospectus carefully.

THE PROPOSED REORGANIZATION


  The Board of Trustees of the Target Fund, including the trustees who are not
"interested persons" of the Target Fund (as defined in the 1940 Act), has
unanimously approved the Agreement and Plan of Reorganization. If the
shareholders of the Target Fund approve the Agreement and Plan of
Reorganization, Acquiring Fund Common Shares and Series E Acquiring Fund APS
will be issued to holders of Target Fund Common Shares and Target Fund RP,
respectively, in exchange for substantially all of the assets of the Target Fund
and the assumption of substantially all of the liabilities of the Target Fund.
The Target Fund will then terminate its registration under the 1940 Act and
dissolve under applicable state law. The aggregate net asset value of Acquiring
Fund Common Shares received in the Reorganization will equal the aggregate net
asset value of Target Fund Common Shares held immediately prior to the
Reorganization less the costs of the Reorganization (though holders of Target
Fund Common Shares may receive cash for their fractional shares). The aggregate
liquidation preference of Acquiring Fund APS received in the Reorganization will
equal the aggregate liquidation preference of Target Fund RP held immediately
prior to the Reorganization.


BACKGROUND AND REASONS FOR THE PROPOSED REORGANIZATION


  The Reorganization seeks to combine two similar Funds to achieve certain
economies of scale and other operational efficiencies. Each Fund is registered
as a diversified closed-end management investment company under the 1940 Act.
Each Fund invests primarily in investment grade municipal securities. The
investment objective of each Fund is to seek to provide a high level of current
income exempt from federal income tax, consistent with preservation of capital.
The Acquiring Fund invests at least 80% of its total assets in municipal
securities rated investment grade at the time of investment. The Target Fund
invests at least 80% of its total assets in tax-exempt municipal securities
rated investment grade at the time of investment. Each Fund may invest in
municipal securities subject to the alternative minimum tax provisions of
federal tax law. The Funds are managed by the same investment advisory
personnel.



  The proposed Reorganization will combine the assets of these similar Funds by
reorganizing the Target Fund into the Acquiring Fund. The Board of Trustees of


                                        6
<PAGE>


the Target Fund (the "Target Fund Board"), based upon its evaluation of all
relevant information, anticipates that the Reorganization will benefit holders
of Target Fund Common Shares. In particular, the Target Fund Board believes,
based on data presented by Van Kampen Asset Management, investment adviser to
each of the Funds (the "Adviser"), that holders of Target Fund Common Shares
will experience a reduced overall operating expense ratio as a result of the
Reorganization. The combined fund resulting from the Reorganization will have a
larger asset base than either of the Funds has currently; certain fixed
administrative costs, such as costs of printing shareholder reports and proxy
statements, legal expenses, audit fees, mailing costs and other expenses, will
be spread across this larger asset base, thereby lowering the expense ratio for
holders of Target Fund Common Shares.



EXPENSES



  The table below illustrates the anticipated reduction in operating expenses
expected as a result of the Reorganization. The table sets forth (i) the fees,
expenses and distributions to preferred shareholders paid by the Target Fund for
the 12-month period ended October 31, 2004, (ii) the fees, expenses and
distributions to preferred shareholders paid by the Acquiring Fund for the
12-month period ended October 31, 2004 and (iii) the pro forma fees, expenses
and distributions to preferred shareholders for the Acquiring Fund for the
12-month period ended October 31, 2004, assuming the Reorganization had been
completed at the beginning of such period. As shown below, the Reorganization is
expected to result in decreased total annual expenses for shareholders of the
Target Fund (although such savings will not be immediately realized (see
footnote (c) to the table)).


                                        7
<PAGE>


FEE, EXPENSE AND DISTRIBUTIONS ON PREFERRED SHARES TABLE FOR COMMON SHAREHOLDERS
                                  OF THE FUNDS

                             AS OF OCTOBER 31, 2004


<Table>
<Caption>
                                                   ACTUAL                    PRO FORMA
                                     ----------------------------------   ---------------
                                        VAN KAMPEN
                                     INVESTMENT GRADE     VAN KAMPEN        VAN KAMPEN
                                     MUNICIPAL TRUST    MUNICIPAL TRUST   MUNICIPAL TRUST
                                     ----------------   ---------------   ---------------
<S>                                  <C>                <C>               <C>
Common Shareholder Transaction
  Expenses(a):
Maximum Sales Load (as a percentage
  of offering price)(b)(c).........        None              None              None
Dividend Reinvestment Plan Fees....        None              None              None
Annual Expenses (as a percentage of
  net assets attributable to Common
  Shares):
Investment Advisory Fees(d)........        0.82%             0.82%             0.82%
Interest Payments on Borrowed
  Funds............................           0%                0%                0%
Other Expenses.....................        0.61%             0.24%             0.24%
  Total Annual Expenses(d).........        1.43%             1.06%             1.06%
Distributions
Distributions on Preferred
  Shares(e)........................        0.56%             0.54%             0.54%
Total Annual Expenses and
  Distributions on Preferred
  Shares...........................        1.99%             1.60%             1.60%
</Table>


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


(a) No expense information is presented with respect to Preferred Shares because
    holders of Preferred Shares do not bear any transaction or operating
    expenses of either Fund and will not bear any of the Reorganization expenses
    or any transaction or operating expenses of the combined fund.



(b) Common shares purchased in the secondary market may be subject to brokerage
    commissions or other charges. No sales load will be charged on the issuance
    of common shares in the Reorganization. Common shares are not available for
    purchase from the Funds but may be purchased through a broker-dealer subject
    to individually negotiated commission rates.



(c) In connection with the Reorganization, there are certain other transaction
    expenses which include, but are not limited to: all costs related to the
    preparation, printing and distributing of this Proxy Statement/Prospectus to
    shareholders; costs related to preparation and distribution of materials
    distributed to each Fund's Board; all expenses incurred in connection with
    the preparation of the Agreement and Plan of Reorganization and registration
    statement on Form N-14; SEC and state securities commission filing fees;
    legal and audit fees; portfolio transfer taxes (if any); and any similar
    expenses incurred in connection with the Reorganization. In accordance with
    applicable


                                        8
<PAGE>


    SEC rules, the Board of Trustees of each Fund reviewed the fees and expenses
    that will be borne directly or indirectly by the Funds in connection with
    the Reorganization. After considering various alternatives for allocating
    these costs, the Board of Trustees of each Fund agreed that, in the event
    the Reorganization is approved and completed, the expenses of the
    Reorganization will be shared by the Target Fund and the Acquiring Fund in
    proportion to their projected declines in total annual operating expenses as
    a result of the Reorganization. The table below summarizes each Fund's net
    assets (common shares only) at October 31, 2004, projected annual savings to
    the Target Fund as a result of the Reorganization, allocation of
    Reorganization expenses among the Funds in dollars and percentages, an
    estimated pay-back period (in years) and the resulting effect on each Fund's
    net asset value per common share at October 31, 2004. The Target Fund will
    benefit more from projected annual expense savings of the Reorganization
    than the Acquiring Fund. The projected annual expense savings are generally
    not expected to be immediately realized. The Target Fund is projected to
    benefit much sooner than the Acquiring Fund whose projected annual expenses
    are not expected to change as a result of the Reorganization. If a Target
    Fund shareholder sells his or her common shares prior to the estimated
    pay-back period, then that shareholder may not realize any of the projected
    expense savings resulting from the reduced expense ratio of the combined
    fund. The net asset value per common share of the Target Fund will be
    reduced at the closing date of the Reorganization to reflect the allocation
    of Reorganization expenses to such Fund. The reduction in net asset value
    per common share resulting from the allocation of Reorganization expenses,
    when compared to the relative net asset sizes of the Funds involved in the
    Reorganization, will be greater in the Target Fund than in the Acquiring
    Fund. In the event the Reorganization is not completed, the Adviser will
    bear the costs associated with the Reorganization. The numbers presented in
    the table are estimates; actual results may differ.



<Table>
<Caption>
                                                                                          EFFECT ON
                                                                             ESTIMATED    NET ASSET
                           NET ASSETS    PROJECTED      REORGANIZATION        PAYBACK     VALUE PER
                            (COMMON       ANNUAL     EXPENSE ALLOCATION IN     PERIOD      COMMON
   FUND                   SHARES ONLY)    SAVINGS     DOLLARS/PERCENTAGE     (IN YEARS)     SHARE
   ----                   ------------   ---------   ---------------------   ----------   ---------
   <S>                    <C>            <C>         <C>                     <C>          <C>
   VIG..................  $ 50,148,362   $185,549        $248,000/100%          1.34        0.05
   VKQ..................   603,633,334          0                 0/0%             0           0
     Total Expenses.....                                  248,000/100%
</Table>



(d) Expense information has been restated to reflect permanent reductions made
    to administrative fees for the Acquiring Fund effective as of June 1, 2004
    and permanent reductions made to management fees for the Funds effective as
    of November 1, 2004.



(e) In seeking to enhance the income for its common shareholders, each of the
    Funds uses preferred shares as financial leverage. Leverage created by


                                        9
<PAGE>


    borrowing or other forms of indebtedness would create interest expenses
    which would, if used by the Funds, be charged to common shareholders (shown
    above as "Interest Payments on Borrowed Funds"). Leverage created by
    preferred shares creates dividend payments and/or capital gains
    distributions to preferred shareholders which are charged to common
    shareholders (shown above as "Distributions on Preferred Shares"). The
    dividend rates are based on periodic remarketings or auctions as described
    herein and thus will differ based on varying market conditions at the times
    of such remarketings or auctions.



  EXAMPLE. The following example is intended to help you compare the costs of
investing in the Acquiring Fund pro forma after the Reorganization with the
costs of investing in the Target Fund and the Acquiring Fund without the
Reorganization. An investor would pay the following expenses on a $1,000
investment, assuming (1) the operating expense ratio for each Fund (as a
percentage of net assets attributable to common shares) set forth in the table
above and (2) a 5% annual return throughout the period:



<Table>
<Caption>
                                      1 YEAR      3 YEARS      5 YEARS      10 YEARS
                                      ------      -------      -------      --------
<S>                                   <C>         <C>          <C>          <C>
Van Kampen Investment Grade
  Municipal Trust...................   $ 15         $45          $78          $171
Van Kampen Municipal Trust..........   $ 11         $34          $58          $129
Pro Forma -- Van Kampen Municipal
  Trust.............................   $ 11         $34          $58          $129
</Table>


  The example set forth above assumes common shares of each Fund were purchased
in the initial offerings and the reinvestment of all dividends and distributions
and uses a 5% annual rate of return as mandated by SEC regulations. The example
should not be considered a representation of past or future expenses or annual
rates of return. Actual expenses or annual rates of return may be more or less
than those assumed for purposes of the example.

FURTHER INFORMATION REGARDING THE REORGANIZATION

  The Target Fund Board has determined that the Reorganization is in the best
interests of holders of Target Fund Common Shares and that the interests of such
shareholders will not be diluted as a result of the Reorganization. Similarly,
the Board of Trustees of the Acquiring Fund has determined that the
Reorganization is in the best interests of holders of Acquiring Fund Common
Shares and that the interests of such shareholders will not be diluted as a
result of the Reorganization. It is not anticipated that the Reorganization will
directly benefit the holders of Preferred Shares of either Fund; however, it is
anticipated that the holders of Preferred Shares of each Fund will not be
adversely affected by the Reorganization and the expenses of the Reorganization
will not be borne by the holders of Preferred Shares of either Fund. As a result
of the Reorganization, however, a shareholder of

                                        10
<PAGE>

either Fund will hold a reduced percentage of ownership in the larger combined
fund than he or she did in either of the separate Funds.


  The Reorganization is intended to qualify as a "reorganization" within the
meaning of Section 368(a)(1) of the Internal Revenue Code of 1986, as amended
(the "Internal Revenue Code" or "Code"). If the Reorganization so qualifies, in
general, a shareholder of the Target Fund will recognize no gain or loss upon
the receipt solely of shares of the Acquiring Fund in connection with the
Reorganization. Additionally, the Target Fund will recognize no gain or loss as
a result of the transfer of all of its assets and liabilities solely in exchange
for the shares of the Acquiring Fund or as a result of its dissolution. Neither
the Acquiring Fund nor its shareholders will recognize any gain or loss in
connection with the Reorganization.



  The Target Fund Board requests that shareholders of the Target Fund approve
the proposed Reorganization at the Special Meeting to be held on June 22, 2005.
Shareholder approval of the Reorganization requires the affirmative vote of
shareholders of the Target Fund representing more than 50% of the Target Fund
Common Shares and Target Fund RP outstanding and entitled to vote, each voting
separately as a class. If shareholders of the Target Fund approve the
Reorganization, it is expected that the closing date of the transaction (the
"Closing Date") will be after the close of business on or about June 30, 2005,
but it may be at a different time as described herein.


  The Target Fund Board recommends that you vote "FOR" the proposed
Reorganization.

                    RISK FACTORS AND SPECIAL CONSIDERATIONS


  Because each Fund, under normal market conditions, invests at least 80% of its
total assets in investment grade municipal securities, any risks inherent in
such investments are equally applicable to both Funds and will apply to the
combined fund after the Reorganization. The Reorganization is not expected to
adversely affect the rights of holders of common shares or Preferred Shares of
either Fund or to create additional risks.


MARKET RISK

  Market risk is the possibility that the market values of securities owned by
each Fund will decline. The prices of debt securities tend to fall as interest
rates rise, and such declines tend to be greater among debt securities with
longer maturities. Market risk is often greater among certain types of debt
securities, such as zero coupon bonds which do not make regular interest
payments but are instead bought at a discount to their face values and paid in
full upon maturity. As interest rates change, these securities often fluctuate
more in price than securities that make regular interest payments and therefore
subject the Funds to greater market risk
                                        11
<PAGE>

than a fund that does not own these types of securities. When-issued and delayed
delivery transactions are subject to changes in market conditions from the time
of the commitment until settlement. This may adversely affect the prices or
yields of the securities being purchased. The greater the Funds' outstanding
commitments for these securities, the greater the Funds' exposure to market
price fluctuations.

INTEREST RATE RISK

  Interest rate risk is the risk that prices of municipal securities generally
increase when interest rates decline and decrease when interest rates increase.
Prices of longer-term securities generally change more in response to interest
rate changes than prices of shorter-term securities.

CREDIT RISK


  Credit risk refers to an issuer's ability to make timely payments of interest
and principal. The degree of credit risk depends on both the financial condition
of the issuer and the terms of the obligation. The Acquiring Fund invests at
least 80% of total assets in municipal bonds that are rated investment grade by
("S&P") or Moody's Investors Service Inc. ("Moody's") or comparably rated by
another nationally recognized statistical rating organization. The Target Fund
invests at least 80% of total assets in tax-exempt municipal bonds that are
rated investment grade by S&P or Moody's or comparably rated by another
nationally recognized statistical rating organization. Each Fund may invest up
to 20% of its assets in securities rated below investment grade (but not rated
lower than B- by S&P or B3 by Moody's) or unrated securities considered by such
Fund's investment adviser to be of comparable quality. Therefore, the Funds are
subject to a higher level of credit risk than a fund that invests solely in
investment grade securities. Securities rated BBB by S&P or Baa by Moody's are
in the lowest of the four investment grades and are considered by the rating
agencies to be medium-grade obligations which possess speculative
characteristics so that changes in economic conditions or other circumstances
are more likely to lead to a weakened capacity of the issuer to make principal
and interest payments than in the case of higher-rated securities. The credit
quality of non-investment grade securities is considered speculative by
recognized rating agencies with respect to the issuer's continuing ability to
pay interest and principal. Lower-grade securities may have less liquidity and a
higher incidence of default than higher-grade securities. The Funds may incur
higher expenditures to protect the Funds' interests in such securities. The
credit risks and market prices of lower-grade securities generally are more
sensitive to negative issuer developments, such as reduced revenues or increased
expenditures, or adverse economic conditions, such as a recession, than are
higher-grade securities.


                                        12
<PAGE>

INCOME RISK


  The income shareholders receive from a Fund is based primarily on interest
rates of securities in that Fund's portfolio, which can vary widely over the
short- and long-term. If interest rates drop, your income from such Fund may
drop as well.


NONPAYMENT RISK


  Although the Funds invest at least 80% of their respective total assets in
municipal securities that are rated investment grade at the time of investment,
municipal securities, like other debt obligations, are subject to the risk of
nonpayment. The ability of issuers of municipal securities to make timely
payments of interest and principal may be adversely impacted in general economic
downturns and as relative governmental cost burdens are allocated and
reallocated among federal, state and local governmental units. Such nonpayment
would result in a reduction of income to a Fund and could result in a reduction
in the value of the municipal security experiencing nonpayment and a potential
decrease in the net asset value of a Fund.


CALL RISK


  If interest rates fall, it is possible that issuers of securities with high
interest rates will prepay or "call" their securities before their maturity
dates. In this event, the proceeds from the called securities would likely be
reinvested by the Funds in securities bearing the new, lower interest rates,
resulting in a possible decline in the Funds' income and distributions to
shareholders.


MUNICIPAL SECURITIES RISK


  Under normal market conditions, the Funds invest primarily in municipal
securities. The yields of municipal securities may move differently and
adversely compared to the yields of overall debt securities markets. Although
the interest received from municipal securities generally is exempt from federal
income tax, each Fund may invest all or a substantial portion of its total
assets in municipal securities that pay interest subject to the federal
alternative minimum tax. In addition, there could be changes in applicable tax
laws or tax treatments that reduce or eliminate the current federal income tax
exemption generally applicable to interest received on municipal securities or
otherwise adversely affect the current federal or state tax status of municipal
securities.


RISKS OF USING STRATEGIC TRANSACTIONS

  Each Fund may engage in certain transactions ("Strategic Transactions")
designed to, among other things, reduce its exposure to interest rate movements.
For example, each Fund may purchase and sell exchange-listed and over-the-
counter put and call options on securities, financial futures and other
financial

                                        13
<PAGE>

instruments, purchase and sell financial futures contracts and enter into
various interest rate transactions such as swaps, caps, floors or collars. If a
Fund incorrectly forecasts market values, interest rates or other factors, that
Fund's performance could suffer as a result of its Strategic Transactions. Each
Fund also may suffer a loss if the other party to the Strategic Transaction
fails to meet its obligations. The Funds are not required to use Strategic
Transactions and may choose not to do so.

MANAGER RISK

  As with any managed fund, the investment adviser to each Fund may not be
successful in selecting the best-performing securities or investment techniques,
and a Funds' performance may lag behind that of similar funds.

MARKET DISCOUNT RISK


  Whether investors will realize gains or losses upon the sale of shares of a
Fund will depend upon the market price of the shares at the time of original
purchase and subsequent sale, which may be less or more than such Fund's net
asset value per share. Since the market price of the shares will be affected by
such factors as the relative demand for and supply of the shares in the market,
general market and economic conditions and other factors beyond the control of
the Funds, the Funds cannot predict whether shares of the Funds will trade at,
below or above net asset value. Shares of closed-end funds often trade at a
discount to their net asset values, and the Funds' shares may trade at such a
discount.



  In order to reduce or eliminate a market value discount from net asset value,
the Board of Trustees of a Fund may, subject to the terms of its preferred
shares, authorize such Fund from time to time to repurchase its common shares in
the open market or to tender for its common shares at net asset value. The Board
of Trustees of a Fund, in consultation with the Adviser, will review on a
quarterly basis the possibility of open-market repurchases and/or tender offers
for such Fund's common shares. Subject to its borrowing restrictions, a Fund may
incur debt to finance such repurchases, which entails risks. The ability of a
Fund to enter into tender offers and the common share repurchases may be limited
by the 1940 Act asset coverage requirements and any additional asset coverage
requirements which may be imposed by a rating agency in connection with any
rating of the preferred shares. No assurance can be given that the Board of
Trustees of a Fund will, in fact, authorize such Fund to undertake such
repurchases and/or tender offers or that, if undertaken, such actions would
result in such Fund's common shares trading at a price which is equal or close
to net asset value.



LEVERAGE RISK


  Use of leverage, through the issuance of Preferred Shares, involves certain
risks to holders of common shares of the Funds. For example, each Fund's
issuance of
                                        14
<PAGE>


Preferred Shares may result in higher volatility of the net asset value of its
common shares and potentially more volatility in the market value of its common
shares. In addition, changes in the short-term and medium-term dividend rates
on, and the amount of taxable income allocable to, the Preferred Shares of a
Fund will affect the yield to holders of common shares of such Fund. In certain
circumstances, when a Fund is required to allocate taxable income to holders of
its Preferred Shares, such Fund may be required to make an additional
distribution to such holders in an amount approximately equal to the tax
liability resulting from the allocation (an "Additional Dividend"). Leverage
will allow holders of each Fund's common shares to realize a higher current rate
of return than if such Fund were not leveraged as long as each Fund, while
accounting for its costs and operating expenses, is able to realize a higher net
return on its investment portfolio than the then-current dividend rate (and any
Additional Dividend) paid on its Preferred Shares. Similarly, since a pro rata
portion of the Acquiring Fund's net realized capital gains is generally payable
to holders of Acquiring Fund Common Shares, the use of leverage will increase
the amount of such gains distributed to holders of Acquiring Fund Common Shares.
However, short-term, medium-term and long-term interest rates change from time
to time as do their relationships to each other (i.e., the slope of the yield
curve) depending upon such factors as supply and demand forces, monetary and tax
policies and investor expectations. Changes in any or all of such factors could
cause the relationship between short-term, medium-term and long-term rates to
change (i.e., to flatten or to invert the slope of the yield curve) so that
short-term and medium-term rates may substantially increase relative to the
long-term obligations in which each Fund may be invested. To the extent that the
current dividend rate (and any Additional Dividend) on a Fund's Preferred Shares
approaches the net return on such Fund's investment portfolio, the benefit of
leverage to holders of common shares of such Fund will be decreased. If the
current dividend rate (and any Additional Dividend) on the Preferred Shares of a
Fund were to exceed the net return on such Fund's portfolio, holders of common
shares of such Fund would receive a lower rate of return than if the Fund were
not leveraged. Similarly, since both the costs of issuing Preferred Shares and
any decline in the value of a Fund's investments (including investments
purchased with the proceeds from any Preferred Shares offering) will be borne
entirely by holders of such Fund's common shares, the effect of leverage in a
declining market would result in a greater decrease in net asset value to
holders of common shares than if such Fund were not leveraged. If a Fund is
liquidated, holders of such Fund's Preferred Shares will be entitled to receive
liquidating distributions before any distribution is made to holders of common
shares of such Fund.


  In an extreme case, a decline in net asset value could affect a Fund's ability
to pay dividends on its common shares. Failure to make such dividend payments
could adversely affect a Fund's qualification as a regulated investment company
under the federal tax laws. However, each Fund intends to take all measures
necessary to

                                        15
<PAGE>


make required Common Share dividend payments. If a Fund's current investment
income is ever insufficient to meet dividend payments on either its common
shares or its Preferred Shares, such Fund may have to liquidate certain of its
investments. In addition, each Fund has the authority to redeem its Preferred
Shares for any reason and may be required to redeem all or part of its Preferred
Shares in the following circumstances:



  - if the asset coverage for the Preferred Shares declines below 200%, either
    as a result of a decline in the value of a Fund's portfolio investments or
    as a result of the repurchase of common shares in tender offers or
    otherwise, or



  - in order to maintain the asset coverage guidelines established by Moody's
    and S&P in rating the Preferred Shares.



  In addition, in the case of Target Fund RP, if on any dividend date the Target
Fund fails to generate sufficient available net tax-exempt income to pay accrued
and unpaid dividends on the RP out of solely tax-exempt income at the applicable
dividend rate, the Target Fund will be required to redeem all or part of its
Target Fund RP.



  Redemption of the Preferred Shares or insufficient investment income to make
dividend payments, may reduce the net asset value of a Fund's common shares and
require a Fund to liquidate a portion of its investments at a time when it may
be disadvantageous to do so.


ANTI-TAKEOVER PROVISIONS


  The Declaration of Trust of each Fund (in each case, the "Declaration of
Trust") includes provisions that could limit the ability of other entities or
persons to acquire control of that Fund or to change the composition of its
Board of Trustees. Such provisions could limit the ability of common
shareholders to sell their shares at a premium over prevailing market prices by
discouraging a third party from seeking to obtain control of either Fund.


SPECIAL RISKS RELATED TO PREFERRED SHARES


  AUCTION/REMARKETING RISK. The dividend rate for the Acquiring Fund APS
normally is set through an auction process. In the auction, preferred
shareholders may indicate the dividend rate at which they would be willing to
hold or sell their shares or purchase additional shares. An auction fails if
there are more Acquiring Fund APS offered for sale than there are buyers, in
which case preferred shareholders may not be able to sell their Acquiring Fund
APS. Also, if preferred shareholders place bids to retain shares at an auction
only at a specified dividend rate and that rate exceeds the rate set at the
auction, they will not retain their shares. Additionally, if preferred
shareholders buy shares or elect to retain shares without specifying a dividend
rate below which they would not wish to buy or continue to

                                        16
<PAGE>


hold those Acquiring Fund APS, they could receive a lower rate of return on
their shares than the market rate. Finally, the dividend period for the
Acquiring Fund APS may be changed by the Acquiring Fund, subject to certain
conditions, including notice to preferred shareholders, which could also affect
the liquidity of an investment in Acquiring Fund APS.



  The dividend rate on the Target Fund RP is set using a remarketing process,
which has separate risks. There can be no assurance that the remarketing agent
will be able to remarket all shares of Target Fund RP tendered in a remarketing.
If any shares of Target Fund RP tendered in a remarketing are not remarketed, a
holder of such shares may be required to hold some or all of its shares at least
until the end of the next dividend period or to sell its shares outside a
remarketing. In such case, the remarketing procedures may require an allocation
of shares of Target Fund RP on a pro rata basis to the extent practicable, or by
lot, as determined by the remarketing agent in its sole discretion, which may
result in a holder's selling a number of shares of Target Fund RP that is less
than the number of shares of Target Fund RP specified in such holder's tender
order. Additionally, while a holder or prospective purchaser of Target Fund RP
may indicate to the remarketing agent its dividend rate preferences, any such
notice given to the remarketing agent to tender or hold shares for a particular
dividend period is irrevocable and may not be conditioned upon the level at
which applicable dividend rates are set. Therefore, the actual applicable
dividend rate for such dividend period may be greater than or less than the rate
indicated and will not be determined until after a holder is required to elect
to hold or tender its shares.



  SECONDARY MARKET RISK. Broker-dealers may maintain a secondary trading market
in the Preferred Shares outside of auctions or remarketings, as applicable;
however, they are not obligated to do so and there can be no assurance that such
a secondary market will develop or, if it does develop, that it will provide
preferred shareholders with a liquid trading market. It may not be possible to
sell Preferred Shares between auctions or remarketings, as applicable, or it may
only be possible to sell them for a price less than their liquidation preference
plus any accumulated dividends. An increase in the level of interest rates
likely will have an adverse effect on the secondary market price of the
Preferred Shares. Preferred Shares may only be transferred outside of auctions
or remarketings to or through broker-dealers or other persons as a Fund permits.



  RATINGS AND ASSET COVERAGE RISKS. Although the Preferred Shares of each Fund
have been rated "Aaa" by Moody's and "AAA" by S&P, such ratings do not eliminate
or necessarily mitigate the risks of investing in Preferred Shares. Moody's or
S&P could downgrade its rating of the Preferred Shares or withdraw its rating at
any time, which may make the Preferred Shares less liquid at an auction or
remarketing, as applicable, or in the secondary market. If a Fund fails to
satisfy its asset coverage ratios, it will be required to redeem a sufficient
number of Preferred Shares in order to return to compliance with the asset
coverage ratios. A Fund may


                                        17
<PAGE>

voluntarily redeem Preferred Shares under certain circumstances in order to meet
asset coverage tests.

                            COMPARISON OF THE FUNDS


INVESTMENT OBJECTIVE AND POLICIES



  The Funds have the same investment objective and similar investment policies.
Each Fund's investment objective is to provide common shareholders with a high
level of current income exempt from federal income tax, consistent with
preservation of capital.



  Each Fund intends to achieve its objective primarily by investing in a
diversified portfolio of municipal securities which the investment adviser
believes does not involve undue risk to income or principal. Under normal market
conditions, the Acquiring Fund will invest at least 80% of its total assets in
municipal securities rated at least investment grade at the time of investment.
Up to 20% of the Acquiring Fund's total assets may be invested in unrated
municipal securities believed, at the time of investment, by the Adviser to have
credit characteristics equivalent to, and to be comparable quality as, municipal
securities that are rated investment grade. The Target Fund will invest at least
80% of its total assets in tax-exempt municipal securities rated investment
grade at the time of investment. Investment grade securities are rated BBB or
higher by S&P or Baa or higher by Moody's in the case of long-term obligations,
and have equivalent ratings in the case of short-term obligations. Securities
rated BBB by S&P are regarded by S&P as having an adequate capacity to pay
interest and repay principal; whereas such securities normally exhibit adequate
protection parameters, adverse economic conditions or changing circumstances are
more likely, in the opinion of S&P, to lead to a weakened capacity to pay
interest and repay principal for debt in this category than in higher rated
categories. Securities rated Baa by Moody's are considered by Moody's as medium
grade obligations; they are neither highly protected nor poorly secured;
interest payments and principal security appear to Moody's to be adequate for
the present but certain protective elements may be lacking or may be
characteristically unreliable over any great length of time; in the opinion of
Moody's, they lack outstanding investment characteristics and in fact have
speculative characteristics as well. Up to 20% of each Fund's total assets may
be invested in securities rated between BB+ and B- (inclusive) by S&P or between
Ba and B3 (inclusive) by Moody's (or equivalently rated short-term obligations)
and unrated securities that the Adviser believes are of comparable quality. With
respect to such 20% of a Fund's total assets, neither Fund has established any
limit on the percentage of its portfolio which may be invested in securities in
any one rating category. Each Fund may be more dependent upon the Adviser's
investment analysis of unrated securities than is the case with respect to rated
securities.


                                        18
<PAGE>


  The foregoing policies with respect to credit quality of portfolio investments
apply only at the time of purchase of a security, and the Funds are not required
to dispose of a security in the event that S&P or Moody's (or any other
nationally recognized statistical rating organization) downgrades its assessment
of the credit characteristics of a particular issuer or, in the case of unrated
securities, in the event the Adviser reassesses its view with respect to the
credit quality of the issuer thereof. In determining whether a Fund will retain
or sell such a security, the Adviser may consider such factors as the Adviser's
assessment of the credit quality of the issuer of such security, the price at
which such security could be sold and the rating, if any, assigned to such
security by other nationally recognized statistical rating organizations.



  MUNICIPAL SECURITIES. Municipal securities are obligations issued by or on
behalf of states, certain territories and possessions of the United States and
the District of Columbia and their political subdivisions, agencies and
instrumentalities, the interest on which is, in the opinion of bond counsel or
other counsel to the issuer of such securities, at the time of issuance, not
includable in gross income for regular federal income tax purposes. It is a
fundamental policy for the Target Fund that at least 80% of the Target Fund's
assets be invested in tax-exempt municipal securities and for the Acquiring Fund
that under normal market conditions, at least 80% of the Acquiring Fund's total
assets be invested in municipal securities. Subject to the limitations set forth
in this Proxy Statement/Prospectus, the Funds may engage in certain hedging
transactions and may purchase and sell put and call options on municipal
securities and on indices of municipal securities. Such transactions will not be
treated as investments in tax-exempt securities or in municipal securities for
the purpose of the Funds' respective 80% test. The Funds have not established
any limit on the percentage of their respective portfolios that may be invested
in municipal securities that pay interest subject to the alternative minimum tax
provisions of federal tax law, and a substantial portion of the income produced
by a Fund may be taxable under the federal alternative minimum tax.



  Municipal securities include long-term obligations, often called municipal
bonds, as well as short-term municipal notes, participation certificates,
municipal leases and tax-exempt commercial paper. During ordinary market
conditions, longer-term municipal securities generally provide a higher yield
than short-term municipal securities of similar credit quality and therefore the
Funds generally expect primarily to invest and hold until maturity longer-term
municipal securities. The Funds may, however, invest in short-term municipal
securities when yields are greater than yields available on long-term municipal
securities, to stabilize net asset value and for temporary defensive purposes.


  The two principal classifications of municipal bonds are "general obligation"
bonds and "revenue" or "special obligation" bonds, which include "industrial
revenue bonds." General obligation bonds are secured by the issuer's pledge of
its

                                        19
<PAGE>

faith, credit and taxing power for the payment of principal and interest, and
accordingly the capacity of the issuer of a general obligation bond as to the
timely payment of interest and the repayment of principal when due is affected
by the issuer's maintenance of its tax base. Revenue or special obligation bonds
are payable only from the revenues derived from a particular facility or class
of facilities or, in some cases, from the proceeds of a special tax or other
specific revenue source such as from the user of the facility being financed;
accordingly the timely payment of interest and, the repayment of principal in
accordance with the terms of the revenue or special obligation bond is a
function of the economic viability of such facility or such revenue source.
Although the ratings of S&P or Moody's of the municipal securities in the Funds'
portfolio are relative and subjective, and are not absolute standards of
quality, such ratings reflect the assessment of S&P or Moody's, as the case may
be, of the issuer's ability, or the economic viability of the special revenue
source, with respect to the timely payment of interest and the repayment of
principal in accordance with the terms of the obligation.


  Also included within the general category of municipal securities are
participations in lease obligations or installment purchase contract obligations
(collectively called "lease obligations") of municipal authorities or entities.
Although lease obligations do not constitute general obligations of the
municipality for which the municipality's taxing power is pledged, a lease
obligation ordinarily is backed by the municipality's covenant to budget for,
appropriate and make the payments due under the lease obligation. However,
certain lease obligations contain "non-appropriation" clauses which provide that
the municipality has no obligation to make lease or installment purchase
payments in future years unless money is appropriated for such purpose on a
yearly basis. Although "non-appropriation" lease obligations are secured by the
leased property, disposition of the property in the event of foreclosure might
prove difficult. There is no limitation on the percentage of a Fund's assets
that may be invested in "non-appropriation" lease obligations.



  Participation certificates are obligations issued by state and local
governments or authorities to finance the acquisition of equipment and
facilities. They may represent participations in a lease, an installment
purchase contract, or a conditional sales contract. Some municipal leases and
participation certificates may not be readily marketable.



  The "issuer" of municipal securities is generally deemed to be the
governmental agency, authority, instrumentality or other political subdivision,
or the non-governmental user of a revenue bond-financed facility, the assets and
revenues of which will be used to meet the payment obligations, or the guarantee
of such payment obligations, of the municipal securities.



  Municipal securities may have fixed or variable interest rates. The Funds may
purchase floating and variable rate demand notes, which are municipal securities

                                        20
<PAGE>


normally having a stated maturity in excess of one year, but which permit the
holder to tender the notes for purchase at the principal amount thereof. The
interest rate on a floating rate demand note is based on a known lending rate,
such as a bank's prime rate, and is adjusted each time such rate is adjusted.
The interest rate demand note is adjusted at specified intervals. There
generally is no secondary market for these notes, although they may be tendered
for redemption at face value. Each such note purchased by the Funds will meet
the criteria established for the purchase of municipal securities.



  There is no limitation as to the maturity of municipal securities in which
each Fund may invest. The Adviser may adjust the average maturity of each Fund's
portfolio from time to time, depending on its assessment of the relative yields
available on securities of different maturities and its expectations of future
changes in interest rates.



  A Fund generally will not invest 25% or more of its total assets in any
industry, nor will either Fund generally invest more than 5% of its total assets
in the securities of any single issue. Governmental issuers of municipal
securities are not considered part of any "industry." However, municipal
securities backed only by the assets and revenues of nongovernmental users may
for this purpose be deemed to be issued by such nongovernmental users, and the
25% limitation would apply to such obligations. It is nonetheless possible that
a Fund may invest 25% or more of its total assets in a broader segment of the
municipal securities market, such as revenue obligations of hospitals and other
health care facilities, housing agency revenue obligations or airport revenue
obligations if the Adviser determines that the yields available from obligations
in a particular segment of the market justify the additional risks associated
with a larger investment in such segment. Although such obligations could be
supported by the credit of governmental users or by the credit of
nongovernmental users engaged in a number of industries, economic, business,
political and other developments generally affecting the revenues of such users
(for example, proposed legislation or pending court decisions affecting the
financing of such projects and market factors affecting the demand for their
services or products) may have a general adverse effect on all municipal
securities in such a market segment. Additionally, each Fund reserves the right
to invest 25% or more of its assets in industrial development bonds or in
issuers located in the same state, although neither Fund has a present intention
to invest 25% or more of its total assets in issuers located in the same state.



  TEMPORARY DEFENSIVE STRATEGIES. At times, the Adviser may judge that
conditions in the markets for tax-exempt municipal securities make pursuing a
Fund's basic investment strategy inconsistent with the best interests of its
shareholders. At such times, the Adviser may use alternative strategies,
primarily designed to reduce fluctuations in the value of such Fund's assets. In
implementing these "defensive" strategies, a Fund may invest to a substantial
degree in high-quality, short-term


                                        21
<PAGE>


municipal obligations. If these high-quality, short-term municipal obligations
are not available or, in the Adviser's judgment, do not afford sufficient
protection against adverse market conditions, a Fund may invest in taxable
obligations. Such taxable obligations may include: obligations of the U.S.
Government, its agencies or instrumentalities; other debt securities rated
within the four highest grades by either S&P or Moody's; commercial paper rated
in the highest grade by either rating service; certificates of deposit and
bankers' acceptances; repurchase agreements with respect to any of the foregoing
investments; or any other fixed-income securities that the Adviser considers
consistent with such strategy. Further, each Fund may generally invest up to 20%
of its total assets in taxable obligations if such investment is determined by
the Adviser to be in the best interest of such Fund, provided, however, that the
Target Fund will not invest in taxable obligations rated below B- by S&P or
below B by Moody's or in taxable obligations regarded as comparable in quality
to such rated securities by the Adviser and the Acquiring Fund will not invest
in taxable obligations rated below Baa by Moody's or below BBB by S&P, or in
non-rated taxable obligations regarded as comparable in quality to such rated
securities by the Adviser. To the extent that the use of certain of these
strategies produces taxable income to the Target Fund, this taxable income will
be distributed exclusively to the holders of Target Fund Common Shares. To the
extent that the use of certain of these strategies produces taxable income to
the Acquiring Fund, this taxable income will be distributed on a pro rata basis
among the Acquiring Fund APS and the Acquiring Fund Common Shares. It is
impossible to predict whether, or for how long, a Fund will use any such
defensive strategies. Further, the yields on such securities may approach or be
less than the then current dividend rate payable to preferred shareholders. In
such event, the benefit of leverage to the common shareholders will diminish and
such Fund's leveraged capital structure may work to the disadvantage of the
common shareholders.


OTHER INVESTMENT PRACTICES AND POLICIES

  In connection with the investment objective and policies described above, each
Fund may, but is not required to, utilize various other investment strategies as
described below to earn income, to facilitate portfolio management and to
mitigate risk. Such strategies are generally accepted by modern portfolio
managers and are regularly utilized by many investment companies and other
institutional investors. These investment practices entail risks. Although the
Adviser believes that these investment practices may further the Funds'
respective investment objectives, no assurance can be given that these
investment practices will achieve this result.


  OPTIONS. Put options and call options typically have similar structural
characteristics and operational mechanics regardless of the underlying
instrument on which they are purchased or sold. Thus, the following general
discussion relates to each of the particular types of options discussed in
greater detail below. In general, each Fund may purchase and sell (write)
options on up to 20% of its assets. In addition, many

                                        22
<PAGE>


Strategic Transactions involving options require segregation of Fund assets in
special accounts, as described below under "Use of Segregated and Other Special
Accounts."



  A put option gives the purchaser of the option, upon payment of a premium, the
right to sell, and the writer the obligation to buy, the underlying security,
commodity, index or other instrument at the exercise price. For instance, a
Fund's purchase of a put option on a security might be designed to protect its
holdings in the underlying instrument (or, in some cases, a similar instrument)
against a substantial decline in the market value by giving that Fund the right
to sell such instrument at the option exercise price. A call option, upon
payment of a premium, gives the purchaser of the option the right to buy, and
the seller the obligation to sell, the underlying instrument at the exercise
price. A Fund's purchase of a call option on a security, financial future
contract, index or other instrument might be intended to protect that Fund
against an increase in the price of the underlying instrument that it intends to
purchase in the future by fixing the price at which it may purchase such
instrument. An American style put or call option may be exercised at any time
during the option period while a European style put or call option may be
exercised only upon expiration or during a fixed period prior thereto. Each Fund
is authorized to purchase and sell exchange listed options and over-the-counter
options ("OTC options"). Exchange listed options are issued by a regulated
intermediary such as the Options Clearing Corporation ("OCC"), which guarantees
the performance of the obligations of the parties to such options. The
discussion below uses the OCC as a paradigm, but is also applicable to other
financial intermediaries.



  With certain exceptions, OCC issued and exchange listed options generally
settle by physical delivery of the underlying security or currency, although in
the future cash settlement may become available. Index options and Eurodollar
instruments are cash settled for the net amount, if any, by which the option is
"in-the-money" (i.e., where the value of the underlying instrument exceeds, in
the case of a call option, or is less than, in the case of a put option, the
exercise price of the option) at the time the option is exercised. Frequently,
rather than taking or making delivery of the underlying instrument through the
process of exercising the option, listed options are closed by entering into
offsetting purchase or sale transactions that do not result in ownership of the
new option.



  A Fund's ability to close out its position as a purchaser or seller of an OCC
or exchange listed put or call option is dependent, in part, upon the liquidity
of the option market. Among the possible reasons for the absence of a liquid
option market on an exchange are: (i) insufficient trading interest in certain
options; (ii) restrictions on transactions imposed by an exchange; (iii) trading
halts, suspensions or other restrictions imposed with respect to particular
classes or series of options or underlying securities including reaching daily
price limits; (iv) interruption of the normal operations of the OCC or an
exchange; (v) inadequacy of the facilities of an exchange or OCC to handle
current trading


                                        23
<PAGE>


volume; or (vi) a decision by one or more exchanges to discontinue the trading
of options (or a particular class or series of options), in which event the
relevant market for that option on that exchange would cease to exist, although
outstanding options on that exchange would generally continue to be exercisable
in accordance with their terms.



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



  OTC options are purchased from or sold to securities dealers, financial
institutions or other parties ("Counterparties") through direct bilateral
agreement with the Counterparty. In contrast to exchange listed options, which
generally have standardized terms and performance mechanics, all the terms of an
OTC option, including such terms as method of settlement, term, exercise price,
premium, guarantees and security, are set by negotiation of the parties. Each
Fund will only enter into OTC options that have a buy-back provision permitting
that Fund to require the Counterparty to close the option at a formula price
within seven days. Each Fund expects generally to enter into OTC options that
have cash settlement provisions, although it is not required to do so.



  Unless the parties provide for it, there is no central clearing or guaranty
function in an OTC option. As a result, if the Counterparty fails to make or
take delivery of the security, or other instrument underlying an OTC option it
has entered into with a Fund or fails to make a cash settlement payment due in
accordance with the terms of that option, that Fund will lose any premium it
paid for the option as well as any anticipated benefit of the transaction.
Accordingly, the Adviser must assess the creditworthiness of each such
Counterparty or any guarantor or credit enhancement of the Counterparty's credit
to determine the likelihood that the terms of the OTC option will be satisfied.
Each Fund will engage in OTC option transactions only with U.S. government
securities dealers recognized by the Federal Reserve Bank of New York as
"primary dealers", or broker-dealers, domestic or foreign banks or other
financial institutions which have received (or the guarantors of the obligation
which have received) a short-term credit rating of "A-1" from S&P or "P-1" from
Moody's or an equivalent rating from any other nationally recognized statistical
rating organization ("NRSRO"). The staff of the SEC currently takes the position
that, in general, OTC options on securities (other than U.S. government
securities) purchased by a Fund, and portfolio securities "covering" the amount
of such Fund's obligation pursuant to an OTC option sold by it (the cost of the
sell-back plus the in-the-money amount, if any) are illiquid, and are subject to
a Fund's limitation on illiquid securities, if any, described herein.


                                        24
<PAGE>


  If a Fund sells a call option, the premium that it receives may serve as a
partial hedge, to the extent of the option premium, against a decrease in the
value of the underlying securities or instruments in its portfolio or will
increase that Fund's income. The sale of put options can also provide income.



  Each Fund may purchase and sell call options on securities, including U.S.
Treasury and agency securities, municipal obligations, mortgage-backed
securities, corporate debt securities that are traded on securities exchanges
and in the OTC markets and related futures contracts. All calls sold by a Fund
must be "covered" (i.e., a Fund must own the securities or futures contract
subject to the call) or must meet the asset segregation requirements described
below as long as the call is outstanding. Even though a Fund will receive the
option premium to help protect it against loss, a call sold by a Fund exposes
that Fund during the term of the option to possible loss of opportunity to
realize appreciation in the market price of the underlying security or
instrument and may require that Fund to hold a security or instrument which it
might otherwise have sold. In the event of exercise of a call option sold by a
Fund with respect to securities not owned by that Fund, such Fund may be
required to acquire the underlying security at a disadvantageous price to
satisfy its obligation with respect to the call option.



  Each Fund may purchase and sell put options on securities including U.S.
Treasury and agency securities, municipal obligations, mortgage-backed
securities and corporate debt securities (whether or not it holds the above
securities in its portfolio.) In selling put options, there is a risk that a
Fund may be required to buy the underlying security at a disadvantageous price
above the market price.



  FUTURES CONTRACTS. Each Fund may enter into financial futures contracts or
purchase or sell put and call options on futures contracts as a hedge against
anticipated interest rate or fixed-income market changes, for duration
management and for risk management purposes. Futures contracts generally are
bought and sold on the commodities exchanges where they are listed with payment
of initial and variation margin as described below. The purchase of a futures
contract creates a firm obligation by a Fund, as purchaser, to take delivery
from the seller of the specific type of financial instrument called for in the
contract at a specific future time for a specified price (or, with respect to
index futures contracts and Eurodollar instruments, the net cash amount). The
sale of a futures contract creates a firm obligation by a Fund, as seller, to
deliver to the buyer the specific type of financial instrument called for in the
contract at a specific future time for a specified price (or, with respect to
index futures and Eurodollar instruments, the net cash amount). Options on
futures contracts are similar to options on securities except that an option on
a futures contract gives the purchaser the right in return for the premium paid
to assume a position in a futures contract and obligates the seller to deliver
such option.


                                        25
<PAGE>


  Each Fund's use of financial futures contracts and options on futures
contracts will in all cases be consistent with applicable regulatory
requirements and in particular the rules and regulations of the Commodity
Futures Trading Commission and will be entered into only for bona fide hedging,
risk management (including duration management) or other portfolio management
purposes. Typically, maintaining a futures contract or selling an option on a
futures contract requires a Fund to deposit with a financial intermediary as
security for its obligations an amount of cash or other specified assets
(initial margin) which initially is typically 1% to 10% of the face amount of
the contract (but may be higher in some circumstances). Additional cash or
assets (variation margin) may be required to be deposited thereafter on a daily
basis as the mark to market value of the contract fluctuates. The purchase of
options on financial futures contracts involves payment of a premium for the
option without any further obligation on the part of a Fund. If a Fund exercises
an option on a futures contract it will be obligated to post initial margin (and
potential subsequent variation margin) for the resulting futures contracts
position just as it would for any position. Futures contracts and options on
futures contracts are generally settled by entering into an offsetting
transaction but there can be no assurance that the position can be offset prior
to settlement at an advantageous price nor that delivery will occur.



  Each Fund will not enter into a futures contract or an option on a futures
contracts (except for closing transactions) for other than bona fide hedging
purposes if, immediately thereafter, the sum of the amount of its initial margin
and premiums on open futures contracts and options thereon would exceed 5% of
such Fund's total assets (taken at current value); however, in the case of an
option that is in-the-money at the time of the purchase, the in-the-money amount
may be excluded in calculating the 5% limitation. The segregation requirements
with respect to futures contracts and options thereon are described below.



  OPTIONS ON SECURITIES INDICES AND OTHER FINANCIAL INDICES. Each Fund also may
purchase and sell call and put options on securities indices and other financial
indices and in so doing can achieve many of the same objectives it would achieve
through the sale or purchase of options on individual securities or other
instruments. Options on securities indices and other financial indices are
similar to options on a security or other instrument except that, rather than
settling by physical delivery of the underlying instrument, they settle by cash
settlement, i.e., an option on an index gives the holder the right to receive,
upon exercise of the option, an amount of cash if the closing level of the index
upon which the option is based exceeds, in the case of a call, or is less than,
in the case of a put, the exercise price of the option (except if, in the case
of an OTC option, physical delivery is specified). This amount of cash is equal
to the excess of the closing price of the index over the exercise price of the
option, which also may be multiplied by a formula value. The seller of the
option is obligated, in return for the premium received, to make delivery of
this amount. The gain or loss on an option on an index depends on price
movements in the

                                        26
<PAGE>


instruments making up the market, market segment, industry or other composite on
which the underlying index is based, rather than price movements in individual
securities, as is the case with respect to options on securities.



  COMBINED TRANSACTIONS. Each Fund may enter into multiple transactions,
including multiple options transactions, multiple futures contracts transactions
and multiple interest rate transactions and any combination of futures
contracts, options and interest rate transactions ("component" transactions),
instead of a single Strategic Transaction, as part of a single or combined
strategy when, in the opinion of the Adviser, it is in the best interests of a
Fund to do so. A combined transaction will usually contain elements of risk that
are present in each of its component transactions. Although combined
transactions are normally entered into based on the Adviser's judgment that the
combined strategies will reduce risk or otherwise more effectively achieve the
desired portfolio management goal, it is possible that the combination will
instead increase such risks or hinder achievement of the portfolio management
objective.



  SWAPS, CAPS, FLOORS AND COLLARS. Among the Strategic Transactions into which
each Fund may enter are interest rate and index swaps and the purchase or sale
of related caps, floors and collars. Each Fund expects to enter into these
transactions primarily to preserve a return or spread on a particular investment
or portion of its portfolio, as a duration management technique or to protect
against any increase in the price of securities such Fund anticipates purchasing
at a later date. Each Fund intends to use these transactions as hedges and not
as speculative investments and will not sell interest rate caps or floors where
it does not own securities or other instruments providing the income stream such
Fund may be obligated to pay. Interest rate swaps involve the exchange by a Fund
with another party of their respective commitments to pay or receive interest,
e.g., an exchange of floating rate payments for fixed rate payments with respect
to a notional amount of principal. An index swap is an agreement to swap cash
flows on a notional amount based on changes in the values of the reference
indices. The purchase of a cap entitles the purchaser to receive payments on a
notional principal amount from the party selling such cap to the extent that a
specified index exceeds a predetermined interest rate or amount. The purchase of
a floor entitles the purchaser to receive payments on a notional principal
amount from the party selling such floor to the extent that a specified index
falls below a predetermined interest rate or amount. A collar is a combination
of a cap and a floor that preserves a certain return within a predetermined
range of interest rates or values.



  USE OF SEGREGATED AND OTHER SPECIAL ACCOUNTS. Many Strategic Transactions, in
addition to other requirements, require that a Fund segregate cash and/or liquid
securities to the extent that such Fund's obligations are not otherwise
"covered" through ownership of the underlying security, financial instrument or
currency. In general, either the full amount of any obligation by a Fund to pay
or deliver


                                        27
<PAGE>


securities or assets must be covered at all times by the securities, instruments
or currency required to be delivered, or, subject to any regulatory
restrictions, a Fund must segregate cash and/or liquid securities in an amount
at least equal to the current amount of the obligation. The segregated assets
cannot be sold or transferred unless equivalent assets are substituted in their
place or it is no longer necessary to segregate. For example, a call option
written by a Fund will require that Fund to hold the securities subject to the
call (or securities convertible into the needed securities without additional
consideration) or to segregate cash and/or liquid securities sufficient to
purchase and deliver the securities if the call is exercised. A call option sold
by a Fund on an index will require that Fund to own portfolio securities which
correlate with the index or to segregate cash and/or liquid securities equal to
the excess of the index value over the exercise price on a current basis. A put
option written by a Fund requires that Fund to segregate cash and/or liquid
securities equal to the exercise price.



  OTC options entered into by a Fund, including those on securities, financial
instruments or indices and OCC issued and exchange listed index options, will
generally provide for cash settlement. As a result, when a Fund sells these
instruments it will only segregate an amount of cash and/or liquid securities
equal to its accrued net obligations, as there is no requirement for payment or
delivery of amounts in excess of the net amount. These amounts will equal 100%
of the exercise price in the case of a non cash-settled put, the same as an OCC
guaranteed listed option sold by a Fund, or the in-the-money amount plus any
sell-back formula amount in the case of a cash-settled put or call. In addition,
when a Fund sells a call option on an index at a time when the in-the-money
amount exceeds the exercise price, that Fund will segregate, until the option
expires or is closed out, cash and/or liquid securities equal in value to such
excess. OCC issued and exchange listed options sold by a Fund other than those
above generally settle with physical delivery, and that Fund will segregate an
amount of cash and/or liquid securities equal to the full value of the option.
OTC options settling with physical delivery, or with an election of either
physical delivery or cash settlement, will be treated the same as other options
settling with physical delivery.



  In the case of a futures contract or an option on a futures contract, a Fund
must deposit initial margin and possible daily variation margin in addition to
segregating cash and/or liquid securities sufficient to meet its obligation to
purchase or provide securities or currencies, or to pay the amount owed at the
expiration of an index-based futures contract.



  With respect to swaps, each Fund will accrue the net amount of the excess, if
any, of its obligations over its entitlements with respect to each swap on a
daily basis and will segregate an amount of cash and/or liquid securities having
a value equal to the accrued excess. Caps, floors and collars require
segregation of cash and/or liquid securities with a value equal to a Fund's net
obligation, if any.


                                        28
<PAGE>


  Strategic Transactions may be covered by other means when consistent with
applicable regulatory policies. Each Fund also may enter into offsetting
transactions so that its combined position, coupled with any segregated cash
and/or liquid securities, equals its net outstanding obligation in related
options and Strategic Transactions. For example, a Fund could purchase a put
option if the strike price of that option is the same or higher than the strike
price of a put option sold by that Fund. Moreover, instead of segregating cash
and/or liquid securities if a Fund held a futures contract or forward contract,
it could purchase a put option on the same futures contract or forward contract
with a strike price as high or higher than the price of the contract held. Other
Strategic Transactions also may be offset in combinations. If the offsetting
transaction terminates at the time of or after the primary transaction no
segregation is required, but if it terminates prior to such time, cash and/or
liquid securities equal to any remaining obligation could need to be segregated.



  A Fund's activities involving Strategic Transactions may be limited by the
requirements of the Code for qualification as a regulated investment company.
Losses resulting from the use of Strategic Transactions would reduce net asset
value, and possibly income, and such losses can be greater than if the Strategic
Transactions had not been utilized. Income earned or gains realized or deemed to
be earned or realized, if any, by a Fund from engaging in Strategic Transactions
generally will be taxable income of such Fund. Such income earned or realized by
the Target Fund is allocated to the Target Fund Common Shares. Such income
earned or realized by the Acquiring Fund is allocated to the Acquiring Fund
Common Shares and the Acquiring Fund APS on a pro rata basis.



  "WHEN ISSUED" AND "DELAYED DELIVERY" TRANSACTIONS. Each Fund may also purchase
and sell municipal securities on a "when issued" and "delayed delivery" basis.
No income accrues to a Fund on municipal securities in connection with such
transactions prior to the date that Fund actually takes delivery of such
securities. These transactions are subject to market fluctuation; the value of
the municipal securities at delivery may be more or less than their purchase
price, and yields generally available on municipal securities when delivery
occurs may be higher or lower than yields on the municipal securities obtained
pursuant to such transactions. Because a Fund engaging in such transactions
relies on the buyer or seller, as the case may be, to consummate the
transaction, failure by the other party to complete the transaction may result
in such Fund missing the opportunity of obtaining a price or yield considered to
be advantageous. When a Fund is the buyer in such a transaction, however, it
will maintain, in a segregated account with its custodian, cash or liquid
portfolio securities having an aggregate value equal to the amount of such
purchase commitments until payment is made. A Fund will make commitments to
purchase municipal securities on such basis only with the intention of actually
acquiring these securities, but a Fund may sell such securities prior to the
settlement date if such sale is considered to be advisable. To the extent a Fund

                                        29
<PAGE>


engages in "when issued" and "delayed delivery" transactions, it will do so for
the purpose of acquiring securities for a Fund's portfolio consistent with that
Fund's investment objective and policies and not for the purpose of investment
leverage. No specific limitation exists as to the percentage of a Fund's assets
which may be used to acquire securities on a "when issued" or "delayed delivery"
basis.


INVESTMENT RESTRICTIONS


  Each Fund's investment objective, the Target Fund's policy of investing at
least 80% of its assets in tax-exempt municipal securities, the Acquiring Fund's
policy of, under normal market conditions, investing at least 80% of its total
assets in municipal securities and the following investment restrictions are
fundamental and cannot be changed without the approval of the holders of a
majority of the applicable Fund's outstanding voting securities (defined in the
1940 Act as the lesser of (i) more than 50% of the applicable Fund's outstanding
common shares and of the outstanding Preferred Shares, voting by class, or (ii)
67% of such outstanding common shares and of the outstanding Preferred Shares,
voting by class, present at a meeting at which the holders of more than 50% of
the outstanding shares of each such class are present in person or by proxy).
All other investment policies or practices are considered by the Funds not to be
fundamental and accordingly may be changed without shareholder approval. If a
percentage restriction on investment or use of assets set forth below is adhered
to at the time a transaction is effected, later changes in percentage resulting
from changing market values will not be considered a deviation from policy. With
respect to the limitations on illiquid securities and borrowings, the percentage
limitations apply at the time of purchase and on an ongoing basis.



  The Acquiring Fund may not:



   1. With respect to 75% of its total assets, purchase any securities (other
      than tax-exempt obligations guaranteed by the United States Government or
      by its agencies or instrumentalities), if as a result more than 5% of the
      Fund's total assets would then be invested in securities of a single
      issuer or if as a result the Fund would hold more than 10% of the
      outstanding voting securities of any single issuer, except that the Fund
      may purchase securities of other investment companies to the extent
      permitted by (i) 1940 Act, as amended from time to time, (ii) the rules
      and regulations promulgated by the Securities and Exchange Commission
      under the 1940 Act, as amended from time to time or, (iii) an exemption or
      other relief from the provisions of the 1940 Act.



   2. Invest more than 25% of its total assets in a single industry; however, as
      described above under "Investment Objective and Policies," the Fund may
      from time to time invest more than 25% of its total assets in a particular
      segment of the municipal securities market.

                                        30
<PAGE>


   3. Issue senior securities, as defined in the 1940 Act, other than preferred
      shares of beneficial interest, except to the extent such issuance might be
      involved with borrowings described under subparagraph (4) below or with
      respect to hedging and risk management transactions or the writing of
      options within limits described in this Proxy Statement/Prospectus.



   4. Borrow money, except for temporary or emergency purposes from banks or for
      repurchase of the Fund's Shares, and then only in an amount not exceeding
      one-third of the Fund's total assets, including the amount borrowed. The
      Fund will not mortgage, pledge or hypothecate any assets except in
      connection with a borrowing. The Fund will not purchase portfolio
      securities during any period that such borrowings exceed 5% of the total
      asset value of the Fund. Notwithstanding this investment restriction, the
      Fund may enter into "when issued" and "delayed delivery" transactions as
      described above under the heading "Investment Objective and Policies" in
      this Proxy Statement/Prospectus.



   5. Make loans of money or property to any person, except to the extent the
      securities in which the Fund may invest are considered to be loans and
      except that the Fund may lend money or property in connection with
      maintenance of the value of or the Fund's interest with respect to the
      municipal securities owned by the Fund.



   6. Buy any securities "on margin." Neither the deposit of initial or
      variation margin in connection with hedging and risk management
      transactions nor short-term credits as may be necessary for the clearance
      of transactions is considered the purchase of a security on margin.



   7. Sell any securities "short," write, purchase or sell puts, calls or
      combinations thereof, or purchase or sell financial futures or options,
      except as described under the heading "Investment Objective and
      Policies -- Other Investment Practices and Policies" in this Proxy
      Statement/Prospectus.



   8. Act as an underwriter of securities, except to the extent the Fund may be
      deemed to be an underwriter in connection with the sale of securities held
      in its portfolio.



   9. Make investments for the purpose of exercising control or participation in
      management, except to the extent that exercise by the Fund of its rights
      under agreements related to municipal securities would be deemed to
      constitute such control or participation, and except that the Fund may
      purchase securities of other investment companies to the extent permitted
      by (i) 1940 Act, as amended from time to time, (ii) the rules and
      regulations promulgated by the Securities and Exchange Commission under
      the 1940 Act, as amended from time to time or, (iii) an exemption or other
      relief from the provisions of the 1940 Act.

                                        31
<PAGE>


  10. Invest in securities issued by other investment companies except as part
      of a merger, reorganization or other acquisition and except to the extent
      permitted by (i) 1940 Act, as amended from time to time, (ii) the rules
      and regulations promulgated by the Securities and Exchange Commission
      under the 1940 Act, as amended from time to time or, (iii) an exemption or
      other relief from the provisions of the 1940 Act.



  11. Invest in equity interests in oil, gas or other mineral exploration or
      development programs except pursuant to the exercise by the Fund of its
      rights under agreements relating to municipal securities.



  12. Purchase or sell real estate, commodities or commodity contracts, except
      to the extent the municipal securities the Fund may invest in are
      considered to be interests in real estate, commodities or commodity
      contracts or to the extent the Fund exercises its rights under agreements
      relating to such municipal securities (in which case the Fund may
      liquidate real estate acquired as a result of a default on a mortgage),
      and except to the extent that financial futures and related options the
      Fund may invest in are considered to be commodities or commodities
      contracts.



  Additionally, the Target Fund may not:



   1. With respect to 75% of its total assets, purchase any securities (other
      than tax-exempt obligations guaranteed by the United States Government or
      by its agencies or instrumentalities), if as a result more than 5% of the
      Fund's total assets would then be invested in securities of a single
      issuer or if as a result the Fund would hold more than 10% of the
      outstanding voting securities of any single issuer, except that the Fund
      may purchase securities of other investment companies to the extent
      permitted by (i) 1940 Act, as amended from time to time, (ii) the rules
      and regulations promulgated by the Securities and Exchange Commission
      under the 1940 Act, as amended from time to time or, (iii) an exemption or
      other relief from the provisions of the 1940 Act.



   2. Invest more than 25% of its assets in a single industry; however, as
      described above under "Investment Objective and Policies," the Fund may
      from time to time invest more than 25% of its assets in a particular
      segment of the municipal bond market.



   3. Issue senior securities, as defined in the 1940 Act, other than the RP or
      other preferred shares of beneficial interest, except to the extent such
      issuance might be involved with borrowings described under subparagraph
      (4) below or with respect to hedging transactions or the writing of
      options within limits described in this Proxy Statement/Prospectus.


                                        32
<PAGE>


   4. Borrow money, except for temporary or emergency purposes from banks or for
      repurchase of its shares, and then only in an amount not exceeding one-
      third of the Fund's total assets, including the amount borrowed. The Fund
      will not mortgage, pledge or hypothecate any assets except in connection
      with a borrowing. The Fund will not purchase portfolio securities during
      any period in which such borrowings exceed 5% of the total asset value of
      the Fund. Notwithstanding this investment restriction, the Fund may enter
      into "when issued" and "delayed delivery" transactions as described above
      under the heading "Investment Objective and Policies" in this Proxy
      Statement/Prospectus.



   5. Make loans of money or property to any person, except to the extent the
      securities in which the Fund may invest are considered to be loans and
      except that the Fund may lend money or property in connection with
      maintenance of the value of, or the Fund's interest with respect to, the
      securities owned by the Fund.



   6. Buy any securities "on margin." Neither the deposit of initial or
      variation margin in connection with hedging transactions nor short-term
      credits as may be necessary for the clearance of transactions is
      considered the purchase of a security on margin.



   7. Sell any securities "short," write, purchase or sell puts, calls or
      combinations thereof, or purchase or sell financial futures or options,
      except as described under the heading "Investment Objective and
      Policies--Other Investment Practices and Policies" in this Proxy
      Statement/Prospectus.



   8. Act as an underwriter of securities, except to the extent the Fund may be
      deemed to be an underwriter in connection with the sale of securities held
      in its portfolio.



   9. Make investments for the purpose of exercising control or participation in
      management, except to the extent that exercise by the Fund of its rights
      under agreements related to securities owned by the Fund would be deemed
      to constitute such control or participation, and except that the Fund may
      purchase securities of other investment companies to the extent permitted
      by (i) 1940 Act, as amended from time to time, (ii) the rules and
      regulations promulgated by the Securities and Exchange Commission under
      the 1940 Act, as amended from time to time or, (iii) an exemption or other
      relief from the provisions of the 1940 Act.



  10. Invest in securities issued by other investment companies except as part
      of a merger, reorganization or other acquisition and except to the extent
      permitted by (i) 1940 Act, as amended from time to time, (ii) the rules
      and regulations promulgated by the Securities and Exchange Commission
      under


                                        33
<PAGE>


      the 1940 Act, as amended from time to time or, (iii) an exemption or other
      relief from the provisions of the 1940 Act.



  11. Invest in equity interests in oil, gas or other mineral exploration or
      development programs.



  12. Purchase or sell real estate, commodities or commodity contracts, except
      to the extent the securities the Fund may invest in are considered to be
      interests in real estate, commodities or commodities contracts or to the
      extent the Fund exercises its rights under agreements relating to such
      securities (in which case the Fund may liquidate real estate acquired as a
      result of a default on a mortgage), and except to the extent the hedging
      and risk management transactions the Fund may engage in are considered to
      be commodities or commodities contracts.



  13. Invest in illiquid investments, including securities which are subject to
      legal or contractual restrictions on resale or for which there is no
      readily available market (e.g., trading in the securities is suspended or,
      in the case of unlisted securities, market makers do not exist or will not
      entertain bids or offers), if more than 25% of the Fund's assets (taken at
      market value) would be invested in such securities. The Fund does not
      treat investments in caps, swaps and floors as illiquid investments.



  As a matter of operating policy, each Fund will not invest 25% or more of its
assets in a single industry; however, each Fund may from time to time invest 25%
or more of its assets in a particular segment of the municipal securities
market.


MANAGEMENT OF THE FUNDS

  THE BOARDS. The Board of each Fund is responsible for the overall supervision
of the operations of its respective Fund and performs the various duties imposed
on trustees of investment companies by the 1940 Act and under applicable state
law.


  THE ADVISER. The investment adviser for each Fund is Van Kampen Asset
Management. The Adviser is a wholly owned subsidiary of Van Kampen Investments
Inc. ("Van Kampen Investments"). Van Kampen Investments is a diversified asset
management company that administers more than three million retail investor
accounts, has extensive capabilities for managing institutional portfolios and
has more than $98 billion under management or supervision as of March 31, 2005.
Van Kampen Investments is an indirect wholly owned subsidiary of Morgan Stanley,
a preeminent global financial services firm that maintains leading market
positions in each of its three primary businesses: securities, asset management
and credit services. Morgan Stanley is a full service securities firm engaged in
securities trading and brokerage activities, investment banking, research and
analysis, financing and financial advisory services. The principal business
address of the Adviser


                                        34
<PAGE>

and Van Kampen Investments is 1221 Avenue of the Americas, New York, New York
10020.


  Pursuant to separate investment advisory agreements between each Fund and the
Adviser, each Fund pays the Adviser a monthly fee at the annual rate of 0.55% of
such Fund's average daily net assets, including assets attributable to Preferred
Shares. Effective November 1, 2004, the investment advisory fee paid by each
Fund was reduced from 0.60% to 0.55%. Subsequent to the Reorganization, the
Adviser will continue to receive compensation at the rate of 0.55% of the
average daily net assets, including assets attributable to Preferred Shares, of
the combined fund. Because the fees paid to the Adviser are calculated on net
assets including assets attributable to Preferred Shares, the fees earned by the
Adviser will be higher when Preferred Shares are outstanding.



  Under a separate Accounting Services Agreement, the Adviser provides
accounting services to each Fund. The Adviser allocates the cost of such
services to each Fund. Additionally, under a separate Legal Services Agreement,
Van Kampen Investments provides legal services to each Fund. Van Kampen
Investment allocates the cost of such services to each Fund.


  PORTFOLIO MANAGEMENT. Each Fund's portfolio is managed by the Adviser's
Municipal Fixed Income team. The team is made up of established investment
professionals. Current members of the team include Thomas Byron, Vice President;
Robert Wimmel, Vice President; and John Reynoldson, Executive Director.


  Thomas Byron has worked for the Adviser since 1981 and began managing the
Funds in 2000. Robert Wimmel has worked for the Adviser since 1996 and began
managing the Funds in 2001. John Reynoldson has worked for the Adviser since
1987 and began managing the Funds in 2001. Prior to 2001, Messrs. Wimmel and
Reynoldson worked in an investment management capacity for the Adviser.



  Thomas Byron is the lead portfolio manager of each Fund. Robert Wimmel and
John Reynoldson are co-portfolio managers of each Fund. All team members are
responsible for the day-to-day management of each Fund and for the execution of
the overall strategy of each Fund.


  The Reorganization Statement of Additional Information provides additional
information about the portfolio managers' compensation, other accounts managed
by the portfolio managers and the portfolio managers' ownership of securities in
the Acquiring Fund.


  PORTFOLIO TRANSACTIONS WITH AFFILIATES. The Adviser may place portfolio
transactions, to the extent permitted by law, with brokerage firms affiliated
with the Funds and the Adviser if it reasonably believes that the quality of
execution and the commission are comparable to that available from other
qualified firms.


                                        35
<PAGE>


  LEGAL PROCEEDINGS INVOLVING THE ADVISER. The Adviser, certain affiliates of
the Adviser, and certain investment companies advised by the Adviser or its
affiliates were named as defendants in a number of similar class action
complaints which were consolidated. The amended complaint also names as
defendants certain individual trustees and directors of certain investment
companies advised by affiliates of the Adviser; the complaint does not, however,
name the individual trustees of any Van Kampen funds. The complaint generally
alleges that defendants violated their statutory disclosure obligations and
fiduciary duties by failing properly to disclose (i) that the Adviser and
certain affiliates of the Adviser allegedly offered economic incentives to
brokers and others to steer investors to the funds advised by the Adviser or its
affiliates rather than funds managed by other companies, and (ii) that the funds
advised by the Adviser or its affiliates allegedly paid excessive commissions to
brokers in return for their alleged efforts to steer investors to these funds.
The complaint seeks, among other things, unspecified compensatory damages,
rescissionary damages, fees and costs. The defendants' motion to dismiss this
action is pending. After defendants moved to dismiss, the plaintiffs filed a
motion for leave to amend the complaint, which is also pending. The proposed
amendment drops all claims against the named investment companies, which are
listed only as nominal defendants. The proposed amendment raises similar claims
against the Adviser and its affiliates with respect to the investment companies
advised by the Adviser or its affiliates, and, in addition, alleges that
affiliates of the Adviser received undisclosed compensation for steering
investors into thirteen non-affiliated fund families. The defendants intend to
continue to defend this action vigorously. While the defendants believe that
they have meritorious defenses, the ultimate outcome of this matter is not
presently determinable at this early stage of litigation.



  The Adviser and certain affiliates of the Adviser are also named as defendants
in a derivative suit which additionally names as defendants individual trustees
of certain Van Kampen funds; the named investment companies are listed as
nominal defendants. The complaint alleges that defendants caused the Van Kampen
funds to pay economic incentives to a proprietary sales force to promote the
sale of Van Kampen mutual funds. The complaint also alleges that the Van Kampen
funds paid excessive commissions to Morgan Stanley and its affiliates in
connection with the sales of the funds. The complaint seeks, among other things,
the removal of the current trustees of the funds, rescission of the management
contracts for the funds, disgorgement of profits by Morgan Stanley and its
affiliates and monetary damages. This complaint has been coordinated with the
consolidated action described in the preceding paragraph. The defendants have
moved to dismiss this action and otherwise intend to defend it vigorously. This
action is currently stayed until the later of (i) a ruling on the motion to
dismiss the action described in the preceding paragraph or (ii) a ruling on a
motion to dismiss the action described in the next paragraph. While the
defendants believe that they have meritorious defenses, the


                                        36
<PAGE>


ultimate outcome of this matter is not presently determinable at this early
stage of litigation.



  The plaintiff in the action described in the preceding paragraph recently
filed a separate derivative action against the Adviser, certain affiliates of
the Adviser, the individual trustees of certain Van Kampen funds, and certain
unaffiliated entities. The named investment companies are listed as nominal
defendants. The complaint alleges that certain unaffiliated entities engaged in
or facilitated market timing and late trading in the Van Kampen funds, and that
the Adviser, certain affiliates of the Adviser, and the trustees failed to
prevent and/or detect such market timing and late trading. The complaint seeks,
among other things, the removal of the current trustees of the funds, rescission
of the management contracts and distribution plans for the funds, disgorgement
of fees and profits from the Adviser and its affiliates, and monetary damages.
The defendants' motion to dismiss this action is pending. While the defendants
believe that they have meritorious defenses, the ultimate outcome of this matter
is not presently determinable at this early stage of litigation.



  The Adviser and one of the investment companies advised by the Adviser are
named as defendants in a class action complaint generally alleging that the
defendants breached their duties of care to long-term shareholders of the
investment company by valuing portfolio securities at the closing prices of the
foreign exchanges on which they trade without accounting for significant market
information that became available after the close of the foreign exchanges but
before calculation of net asset value. As a result, the complaint alleges,
short-term traders were able to exploit stale pricing information to capture
arbitrage profits that diluted the value of shares held by long-term investors.
The complaint seeks unspecified compensatory damages, punitive damages, fees and
costs. Defendants appealed an order of the federal district court remanding this
case to state court. The federal appeals court recently reversed the federal
district court's order remanding this case to state court and directed entry of
judgment in favor of defendants.



  The Adviser and individual trustees of certain Van Kampen funds are named as
defendants in a recently filed class action complaint that alleges that the
defendants breached various fiduciary and statutory duties to investors by
failing to ensure that the funds participated in securities class action
settlements involving securities held in the funds' portfolios. The complaint
seeks compensatory and punitive damages on behalf of investors in the funds.
None of the funds are named as defendants and no claims are asserted against
them. The defendants expect to move to dismiss the complaint and believe that
they have meritorious defenses.



  The Adviser, one of the investment companies advised by the Adviser, and
certain officers and directors of the investment company are defendants in a
class action filed in 2001 alleging that the defendants issued a series of
prospectuses and registration statements that were materially false and
misleading. Among other things, the complaint alleges that the prospectuses and
registration statements

                                        37
<PAGE>


contained misleading descriptions of the method defendants used to value senior
loan interests in the fund's portfolio, and that defendants materially
overstated the net asset value of the fund. The parties recently mediated the
dispute through a court-supervised settlement conference and reached an
agreement to settle the case. The parties presented a settlement agreement for
preliminary Court approval in April 2005.


OTHER SERVICE PROVIDERS


  COMMUNICATIONS SUPPORT SERVICES PROVIDER. Van Kampen Funds Inc.(the "Support
Services Provider") serves as the communications support service provider to the
Target Fund. The principal place of business of the Support Services Provider is
1221 Avenue of the Americas, New York, New York 10020. The communications
support services include telephonic and written correspondence with shareholders
and brokers. The Target Fund does not pay any fee to the Support Services
Provider but bears certain expenses incurred by the Support Services Provider.



  CUSTODIAN, TRANSFER AGENT, AUCTION AGENT AND DIVIDEND PAYING AGENT. State
Street Bank and Trust Company is the custodian for each of the Funds. Its
principal business address is 225 West Franklin Street, Boston, Massachusetts
02110. EquiServe Trust Company, N.A. is the transfer agent, dividend disbursing
agent and registrar for the common shares of each of the Funds. Its principal
business address is 250 Royall Street, Canton, Massachusetts 02021. Deutsche
Bank Trust Company Americas is the auction agent and paying agent for the
Acquiring Fund APS and is the paying agent with respect to the Target Fund RP.
Its principal business address is 280 Park Avenue, New York, New York 10017.
Merrill Lynch, Pierce, Fenner & Smith Incorporated is the remarketing agent for
the Target Fund RP. Its principal business address is World Financial Center,
North Tower, New York, New York 10281.


CAPITALIZATION

  The Board of Trustees of each Fund may authorize separate classes of shares
together with such designation of preferences, rights, voting powers,
restrictions, limitations, qualifications or terms as may be determined from
time to time by the trustees.

                                        38
<PAGE>


  The table below sets forth the capitalization of the Target Fund and the
Acquiring Fund as of February 28, 2005, and the pro forma capitalization of the
combined fund as if the Reorganization had occurred on that date.



               CAPITALIZATION AS OF FEBRUARY 28, 2005 (UNAUDITED)


                              AMOUNTS IN THOUSANDS



<Table>
<Caption>
                                                    ACTUAL                    PRO FORMA
                                      ----------------------------------   ---------------
                                                           VAN KAMPEN
                                        VAN KAMPEN      INVESTMENT GRADE     VAN KAMPEN
                                      MUNICIPAL TRUST   MUNICIPAL TRUST    MUNICIPAL TRUST
                                      ---------------   ----------------   ---------------
<S>                                   <C>               <C>                <C>
NET ASSETS CONSIST OF:
  Common Shares ($0.01 par
    value)*.........................          364                48                394
  Paid in surplus...................      538,413            51,563            589,746
  Net unrealized appreciation.......       55,892             4,835             60,727
  Accumulated undistributed net
    investment income...............        3,119               (34)             3,085
  Accumulated net realized gain
    (loss)..........................          912            (6,527)            (5,615)
  NET ASSETS APPLICABLE TO COMMON
    SHARES..........................      598,700            49,885            648,337**
  PREFERRED SHARES ($0.01 par value,
    with liquidation preference of
    $25,000 and $100,000 for
    Acquiring Fund and Target Fund,
    respectively)*..................      300,000            25,000            325,000
  NET ASSETS INCLUDING PREFERRED
    SHARES..........................     $898,700           $74,885           $973,337
</Table>


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

 * Based on the number of outstanding shares listed in "Outstanding Securities
   of the Funds" table below.


** Reflect a non-recurring cost associated with the Reorganization of
   approximately $248,000, with all of such $248,000 to be borne by the Target
   Fund common shareholders. See "Information about the
   Reorganization -- Expenses of the Reorganization" for additional information.


                                        39
<PAGE>


          OUTSTANDING SECURITIES OF THE FUNDS AS OF FEBRUARY 28, 2005



<Table>
<Caption>
                                                                  AMOUNT OUTSTANDING
                                                    AMOUNT HELD   EXCLUSIVE OF AMOUNT
                                                    FOR ITS OWN    SHOWN IN PREVIOUS
TITLE OF CLASS                  AMOUNT AUTHORIZED     ACCOUNT           COLUMN
- --------------                  -----------------   -----------   -------------------
<S>                             <C>                 <C>           <C>
VAN KAMPEN INVESTMENT GRADE
  MUNICIPAL TRUST
  Common Shares...............      Unlimited            0             4,839,000
  Preferred Shares............     100,000,000           0                   250
VAN KAMPEN MUNICIPAL TRUST
  Common Shares...............      Unlimited            0            36,365,393
  Preferred Shares............     100,000,000           0                12,000
</Table>


ADDITIONAL INFORMATION ABOUT COMMON SHARES OF THE FUNDS


  GENERAL. Common shareholders of a Fund are entitled to share equally in
dividends declared by such Fund's Board of Trustees payable to holders of the
common shares and in the net assets of such Fund available for distribution to
holders of the common shares after payment of the preferential amounts payable
to preferred shareholders. Common shareholders do not have preemptive or
conversion rights, and a Fund's common shares are not redeemable. The
outstanding common shares of each Fund are fully paid and nonassessable (except
as described under "Governing Law" below). So long as any Preferred Shares of a
Fund are outstanding, holders of such Fund's common shares will not be entitled
to receive any dividends or other distributions from that Fund unless all
accrued dividends on the Fund's outstanding Preferred Shares have been paid, and
unless asset coverage (as defined in the 1940 Act) with respect to such
Preferred Shares would be at least 200% after giving effect to such
distributions.


  PURCHASE AND SALE. Purchase and sale procedures for the common shares of each
of the Funds are identical. Investors typically purchase and sell common shares
of the Funds through a registered broker-dealer on the NYSE or CHX, thereby
incurring a brokerage commission set by the broker-dealer. Alternatively,
investors may purchase or sell common shares of the Funds through privately
negotiated transactions with existing shareholders.

                                        40
<PAGE>


  COMMON SHARE PRICE DATA. The following table sets forth the high and low sales
prices for common shares of each Fund on the NYSE for each full quarterly period
within each Fund's two most recent fiscal years and for the first fiscal quarter
in the current fiscal year for each Fund, along with the net asset value and
discount or premium to net asset value for each quotation.



                           VAN KAMPEN MUNICIPAL TRUST



<Table>
<Caption>
                                     NET ASSET   PREMIUM               NET ASSET   PREMIUM
QUARTERLY PERIOD ENDING  HIGH PRICE    VALUE    (DISCOUNT)  LOW PRICE    VALUE    (DISCOUNT)
- -----------------------  ----------  ---------  ----------  ---------  ---------  ----------
<S>                      <C>         <C>        <C>         <C>        <C>        <C>
January 31, 2005......       $14.92     $16.57     (9.96)%     $14.10     $16.28    (13.39)%
October 31, 2004......        14.90      16.60    (10.24)%      14.30      16.25    (12.00)%
July 31, 2004.........        14.18      16.04    (11.60)%      13.30      15.40    (13.64)%
April 30, 2004........        15.74      17.05     (7.68)%      13.79      16.05    (14.08)%
January 31, 2004......        15.42      16.71     (7.72)%      14.53      16.42    (11.51)%
October 31, 2003......        14.80      16.43     (9.92)%      13.93      15.69    (11.22)%
July 31, 2003.........        15.75      17.11     (7.95)%      14.02      15.69    (10.64)%
April 30, 2003........        15.05      16.50     (8.79)%      14.20      16.25    (12.62)%
January 31, 2003......        14.50      16.21    (10.55)%      13.90      15.92    (12.69)%
</Table>



                  VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST



<Table>
<Caption>
                                     NET ASSET   PREMIUM               NET ASSET   PREMIUM
QUARTERLY PERIOD ENDING  HIGH PRICE    VALUE    (DISCOUNT)  LOW PRICE    VALUE    (DISCOUNT)
- -----------------------  ----------  ---------  ----------  ---------  ---------  ----------
<S>                      <C>         <C>        <C>         <C>        <C>        <C>
January 31, 2005......        $9.18     $10.37    (11.48)%      $8.65     $10.17    (14.95)%
October 31, 2004......         9.15      10.29    (11.08)%       8.77      10.16    (13.68)%
July 31, 2004.........         8.77      10.05    (12.74)%       8.34       9.84    (15.24)%
April 30, 2004........         9.73      10.65     (8.64)%       8.52      10.01    (14.89)%
January 31, 2004......         9.48      10.40     (8.85)%       8.91      10.15    (12.22)%
October 31, 2003......         8.98      10.11    (11.18)%       8.55       9.82    (12.93)%
July 31, 2003.........         9.55      10.56     (9.56)%       8.74       9.89    (11.63)%
April 30, 2003........         9.01      10.25    (12.10)%       8.73      10.01    (12.79)%
January 31, 2003......         8.85      10.15    (12.81)%       8.55       9.96    (14.16)%
</Table>



  As of April 25, 2005, (i) the net asset value per share for Target Fund Common
Shares was $10.26 and the market price per share was $8.94, representing a
discount to net asset value of 12.87%, and (ii) the net asset value per share
for Acquiring Fund Common Shares was $16.39 and the market price per share was
$14.03, representing a discount to net asset value of 14.40%.



  Common shares of each Fund have traded at both a premium and a discount to net
asset value for extended periods since the applicable Fund's inception. In order
to reduce or eliminate a market value discount from net asset value, the Board
of Trustees of each Fund may, subject to the terms and conditions of its
Preferred Shares, authorize that Fund from time to time to repurchase the common
shares in


                                        41
<PAGE>

the open market or to tender for the common shares at net asset value. The Board
of Trustees of each Fund, in consultation with the Adviser, will review on a
quarterly basis the possibility of open market repurchases and/or tender offers
for the common shares. Subject to its borrowing restrictions, each Fund may
incur debt to finance such repurchases, which entails risks. The ability of a
Fund to enter into tender offers and the common share repurchases may be limited
by the 1940 Act asset coverage requirements and any additional asset coverage
requirements which may be imposed by a rating agency in connection with any
rating of the Preferred Shares. No assurance can be given that the Board of
Trustees of either Fund will, in fact, authorize that Fund to undertake such
repurchases and/or tender offers or that, if undertaken, such actions would
result in the common shares trading at a price which is equal or close to net
asset value.


  DIVIDENDS AND DISTRIBUTIONS. The Funds' current policies with respect to
dividends and distributions relating to their respective common shares are
similar. It is each Fund's present policy, which may be changed by its Board of
Trustees, to make monthly distributions to holders of its common shares of
substantially all of the Fund's net investment income remaining after the
payment of dividends on any outstanding Preferred Shares. Net income of each
Fund consists of all interest income accrued on portfolio assets less all
expenses of such Fund. Under current federal tax law, the Target Fund may
allocate net capital gains and other taxable income, if any, received by the
Target Fund to the Target Fund Common Shares, allowing the Target Fund to pay
dividends to the Target Fund RP which qualify in their entirety as tax-exempt
distributions. The Acquiring Fund, however, is required to allocate net capital
gains and other taxable income, if any, received by the Acquiring Fund among the
Acquiring Fund Common Shares and Acquiring Fund APS on a pro rata basis in the
year for which such capital gains and other income is realized.



  Expenses of each Fund are accrued each day. Net realized capital gains, if
any, are expected to be distributed to shareholders at least once a year. While
there are any Preferred Shares of a Fund outstanding, such Fund may not declare
any cash dividend or other distribution on its common shares, unless at the time
of such declaration, (1) all accrued Preferred Shares dividends have been paid
and (2) the value of such Fund's total assets (determined after deducting the
amount of such dividend or other distribution), less all liabilities and
indebtedness of such Fund, is at least 200% (as required by the 1940 Act) of the
liquidation value of the outstanding Preferred Shares (expected to equal the
aggregate original purchase price of the outstanding Preferred Shares plus any
accrued and unpaid dividends thereon, whether or not earned or declared on a
cumulative basis). In addition to the requirements of the 1940 Act, each Fund
may be required to comply with other asset coverage requirements as a condition
of such Fund obtaining a rating of its Preferred Shares from a nationally
recognized rating service. These requirements may include an asset coverage test
more stringent than under the 1940 Act. This

                                        42
<PAGE>


limitation on a Fund's ability to make distributions on its common shares could
in certain circumstances impair the ability of such Fund to maintain its
qualification for taxation as a regulated investment company. Each Fund intends,
however, to the extent possible, to purchase or redeem Preferred Shares from
time to time to maintain compliance with such asset coverage requirements and
may pay special dividends to the holders of the Preferred Shares in certain
circumstances in connection with any such impairment of such Fund's status as a
regulated investment company.



  For information concerning the manner in which dividends and distributions to
holders of each Fund's common shares may be reinvested automatically in the
Fund's common shares, see "-- Dividend Reinvestment Plan" below.



  DIVIDEND REINVESTMENT PLAN. Each Fund offers a Dividend Reinvestment Plan
(each a "Plan," and collectively the "Plans") pursuant to which holders of
common shares may elect to have all distributions of dividends and all capital
gains automatically reinvested in common shares pursuant to such Plan. The Plans
for the Target Fund and the Acquiring Fund are similar. Unless common
shareholders elect to participate in a Plan, common shareholders will receive
distributions of dividends and capital gains in cash. EquiServe Trust Company,
N.A., as plan agent (the "Plan Agent"), serves as agent for the holders of
common shares of each Fund in administering the Plans.



  After the Reorganization, a holder of shares of a Fund who receives dividends
in cash will continue to receive dividends in cash; all holders who elect to
participate in the Plan of a Fund will have their dividends automatically
reinvested in shares of the combined fund. All correspondence concerning the
Plan should be directed to the Plan Agent at P.O. Box 43011, Providence, Rhode
Island 02940-3011. Telephone calls concerning the Plan may be directed to the
Plan Agent between the hours of 7:30 a.m. and 5:00 p.m. Central Standard Time at
(800) 341-2929.



ADDITIONAL INFORMATION ABOUT PREFERRED SHARES OF THE FUNDS



  GENERAL. The Preferred Shares of each Fund have similar structures. Both
Target Fund RP and Acquiring Fund APS are preferred shares of beneficial
interest which entitle their holders to receive dividends when, as and if
declared by the Board of Trustees of such Fund out of funds legally available
therefor, at a rate per annum that may vary for successive dividend periods.
While the Target Fund RP and Acquiring Fund APS are similar in many respects,
there are several differences that shareholders should consider. The Acquiring
Fund APS have a liquidation preference of $25,000 per share. The Target Fund RP
have a liquidation preference of $100,000 per share. Neither Target Fund RP nor
Acquiring Fund APS are traded on a stock exchange or over-the-counter. Holders
of each Fund's Preferred Shares do not have preemptive rights to purchase any
shares of RP or APS, as applicable,


                                        43
<PAGE>

or any other preferred shares that might be issued. The net asset value per
share of a Fund's Preferred Shares equals its liquidation preference plus
accumulated but unpaid dividends per share.


  PURCHASE AND SALE. Acquiring Fund APS and Target Fund RP are purchased or sold
using different procedures.



  Acquiring Fund APS generally are purchased and sold through auctions generally
conducted every 7 days in the case of Series A APS and Series C APS and every 28
days in the case of Series B APS and Series D APS by Deutsche Bank Trust Company
Americas, as the auction agent for the Acquiring Fund's APS (the "Auction
Agent") unless the Acquiring Fund elects to declare a special dividend period.
Unless otherwise permitted by the Acquiring Fund, existing and potential holders
of Acquiring Fund APS only may participate in auctions through their
broker-dealers. Broker-dealers submit the orders of their respective customers
who are existing and potential holders of APS to the Auction Agent. On or prior
to each auction date for the APS (the business day next preceding the first day
of each dividend period), each holder may submit orders to buy, sell or hold APS
to its broker-dealer. Outside of these auctions, shares of APS may be purchased
or sold through broker-dealers for the APS in a secondary trading market
maintained by the broker-dealers. However, there can be no assurance that a
secondary market will develop or if it does develop, that it will provide
holders with a liquid trading market for the Acquiring Fund APS.



  Target Fund RP generally are purchased and sold through remarketings conducted
every 28 days by Merrill Lynch (the "Remarketing Agent"), unless the Target Fund
elects to declare a special dividend period. On each tender date (the business
day preceding the related dividend reset date) for shares of Target Fund RP, the
Remarketing Agent will, after canvassing the market and considering prevailing
market conditions, provide to holders of shares of Target Fund RP non-binding
indications of the applicable dividend rate for the next succeeding 28-day
dividend period. The actual applicable dividend rate for such dividend period
may be greater than or less than the rate indicated in such non-binding
indications and will not be determined until after a holder is required to elect
to hold or tender its shares of Target Fund RP or a new purchaser is required to
agree to purchase shares of Target Fund RP. Each holder of shares of Target Fund
RP then must notify the Remarketing Agent of its desire (on a share-by-share
basis) either to tender such share at a price of $100,000 per share or to
continue to hold such share for a 28-day dividend period. Any holder or
prospective purchaser may informally indicate to the Remarketing Agent its
applicable dividend rate preferences. However, any such notice given to the
Remarketing Agent to tender or hold shares for a particular dividend period is
irrevocable (subject to limit exceptions) and may not be conditioned upon the
level at which applicable dividend rates are set. On the dividend reset date,
the Remarketing Agent will then determine the


                                        44
<PAGE>


applicable dividend rate for the next dividend period, which will be the lowest
rate available which enables the Remarketing Agent to remarket on behalf of the
holders thereof all shares of Target Fund RP tendered to it on such tender date
at a price of $100,000 per share. Such determination will be made in the sole
discretion of the Remarketing Agent and will be conclusive and binding on the
Target Fund and on the holders of shares of Target Fund RP. The Remarketing
Agent intends to make a secondary market in the shares of Target Fund RP outside
of remarketings. The Remarketing Agent, however, has no obligation to make a
secondary market in the shares of Target Fund RP outside of remarketings, and
there can be no assurance that a secondary market for shares of Target Fund RP
will develop or, if it does develop, that it will provide holders with liquidity
of investment.



  With respect to the Acquiring Fund APS, each auction requires the
participation of one or more broker-dealers. The Auction Agent has entered into
agreements with certain broker-dealers, and may enter into similar agreements
with one or more additional broker-dealers (collectively, the "Broker-Dealers")
selected by the Acquiring Fund, which provide for the participation of
Broker-Dealers in auctions. The Auction Agent after each auction for Acquiring
Fund APS will pay to each Broker-Dealer, from funds provided by the Acquiring
Fund, a service charge at the annual rate of 0.25 of 1% in the case of any
auction immediately preceding a rate period of less than one year, or a
percentage agreed to by such Fund and the Broker-Dealers in the case of any
auction immediately preceding a rate period of one year or longer, of the
purchase price of Acquiring Fund APS placed by such Broker-Dealer at such
auction. With respect to the Target Fund, for their services in determining the
applicable dividend rate and remarketing shares of Target Fund RP, the
Remarketing Agent will receive from the Target Fund an annual fee of
approximately 0.25% of the average amount of RP outstanding. The Remarketing
Agent will pay to selected broker-dealers a pro rata portion of the 0.25% per
annum fee, reflecting shares sold through such broker-dealers to purchasers in
remarketings.



  In connection with the Reorganization, a holder of Target Fund RP would
receive Series E Acquiring Fund APS whose auctions generally will be conducted
every 28 days by the Auction Agent unless the Acquiring Fund elects to declare a
special dividend period. Accordingly, Acquiring Fund APS received in connection
with the Reorganization would have a regular dividend period of 28 days like the
28 day dividend period of the Target Fund RP.



  DIVIDENDS AND DISTRIBUTIONS. The holders of Acquiring Fund APS are entitled to
receive, when, as and if declared by the Board of Trustees of such Fund, out of
funds legally available therefor, cumulative cash dividends on their shares. The
holders of Target Fund RP are entitled to receive, when and if declared by the
Board of Trustees of such Fund, out of funds legally available therefor,
cumulative cash dividends on their shares, subject to available net tax-exempt
income. The RP do not have any dividend


                                        45
<PAGE>


accumulation right with respect to any amount by which such Fund's available net
tax-exempt income limited the amount of any dividend that would have otherwise
been paid for any dividend period. In the event of such a limitation on dividend
accumulations, the shares of RP would be subject to mandatory redemption.
Dividends on a Fund's Preferred Shares so declared and payable shall be paid (i)
in preference to and in priority over any dividends so declared and payable on
the Fund's common shares, and (ii) with respect to the Target Fund, to the
extent permitted under the Internal Revenue Code and to the extent of available
net tax-exempt income, out of net tax-exempt income earned by the Target Fund's
investments.



  Prior to each dividend payment date, the relevant Fund is required to deposit
with the Auction Agent, in the case of the Acquiring Fund, or the paying agent
in the case of the RP, sufficient funds for the payment of such declared
dividends. No interest will be payable in respect of any dividend payment or
payment on a Fund's Preferred Shares which may be in arrears. As described
below, a Fund may be required to pay Additional Dividends in certain
circumstances. In no other instances will either Fund be required to make
payments to holders of its Preferred Shares to offset the tax effect of any
reallocation of net capital gains or other taxable income.



  Holders of Target Fund RP generally receive dividends out of the Target Fund's
available net tax-exempt income, which qualify in their entirety as
distributions of tax-exempt interest income for federal income tax purposes
(subject to the possible application of the alternative minimum tax). The
Acquiring Fund, however, is required to allocate net capital gains and other
taxable income, if any, proportionately between its common shares and APS. The
amount of taxable income allocated to the APS depends upon the amount of such
income realized by the Acquiring Fund, but is generally not expected to be
significant.



  If for any taxable year, with respect to the Target Fund's income and gains,
if any, allocable to the Target Fund RP, the Target Fund realizes net capital
gains or any portion of the Target Fund's net income does not qualify in its
entirety as a distribution of tax-exempt interest income for federal income tax
purposes, then an Additional Dividend will become payable to the holders of
Target Fund RP in an amount such that the net after-tax return to such holders
will be the same as the net after-tax return that would have been derived if
such dividend, including any Additional Dividends, had qualified in its entirety
as a distribution of tax-exempt interest income. However, the Target Fund may,
at least 15 days prior to any remarketing, give notice to the Remarketing Agent
of the estimated taxable percentage or a change in the estimated taxable
percentage to be applicable to dividends on such shares for the dividend period
next succeeding such notice. If such notice is given, and unless and until
otherwise duly notified, Additional Dividends will not be payable as described
above and instead, Additional Dividends will be payable to such holders only if,
and to the extent of, the portion of dividends


                                        46
<PAGE>


paid with respect to such shares for such dividend period that does not qualify
as a distribution of tax-exempt interest income for federal income tax purposes
exceeds the estimated taxable percentage.



  In normal circumstances, whenever the Acquiring Fund intends to include any
net capital gains or other taxable income in any dividend on APS, the Fund will
notify the Auction Agent of the amount to be so included prior to the Auction
establishing the applicable rate for such dividend. The Auction Agent will in
turn notify each broker-dealer who will notify existing and potential holders of
Acquiring Fund APS. As a result, auction participants may, in response to such
information, place bids which take account of the inclusion of net capital gains
or other taxable income in the dividend. If the Acquiring Fund retroactively
allocates any net capital gains or other taxable income to the APS without
having given notice to the Auction Agent, solely by reason of the fact that such
allocation is made as a result of the redemption of all or a portion of the
outstanding Acquiring Fund APS or the liquidation of the Acquiring Fund, the
Acquiring Fund will pay an Additional Dividend to offset substantially the tax
effect thereof. As a result of the notice and Additional Dividend provisions,
the after-tax return to a holders of Target Fund RP and Acquiring Fund APS is
not expected to differ substantially.


  While the Funds normally utilize the auction or remarketing procedures
described above, each Fund may utilize special dividend periods in certain
circumstances to set the dividend rate.


  DIVIDEND RATES. The following table provides information about the dividend
rates for each Fund's APS or RP, as applicable, as of a recent auction or
remarketing date.



<Table>
<Caption>
AUCTION OR REMARKETING DIVIDEND DATE             PREFERRED SHARES         RATE
- ------------------------------------             ----------------         ----
<S>                                         <C>                           <C>
April 12, 2005............................        Target Fund RP          2.45%
April 18, 2005............................  Acquiring Fund Series A APS   2.20%
April 19, 2005............................  Acquiring Fund Series B APS   2.85%
April 13, 2005............................  Acquiring Fund Series C APS   2.23%
April 14, 2005............................  Acquiring Fund Series D APS   2.40%
</Table>



  The dividend rates in effect at the closing of the Reorganization will be the
rates determined in the remarketing or auction, as the case may be, most
recently preceding such closing.


  RATINGS. The Target Fund RP and the Acquiring Fund APS have each been assigned
a rating of "AAA" from S&P and "Aaa" from Moody's. Each Fund intends that, so
long as its Preferred Shares are outstanding, the composition of its portfolio
will reflect guidelines established by S&P and Moody's in connection with each
Fund's receipt of a rating for such shares of at least "AAA" from S&P and "Aaa"
from Moody's. S&P and Moody's, which are nationally recognized statistical

                                        47
<PAGE>

rating organizations, issue ratings for various securities reflecting the
perceived creditworthiness of such securities. The guidelines for rating such
preferred shares have been developed by S&P and Moody's in connection with
issuances of asset-backed and similar securities, including debt obligations and
variable rate preferred stock, generally on a case-by-case basis through
discussions with the issuers of these securities. The guidelines are designed to
ensure that assets underlying outstanding debt or preferred stock will be varied
sufficiently and will be of sufficient quality and amount to justify investment
grade ratings. The guidelines do not have the force of law but have been adopted
by each Fund in order to satisfy current requirements necessary for S&P and
Moody's to issue the above-described ratings for Preferred Shares, which ratings
generally are relied upon by institutional investors in purchasing such
securities. The guidelines provide a set of tests for portfolio composition and
asset coverage that supplement (and in some cases are more restrictive than) the
applicable requirements under the 1940 Act.


  Each Fund may, but is not required to, adopt any modifications to these
guidelines that hereafter may be established by S&P or Moody's. Failure to adopt
any such modifications, however, may result in a change in the ratings described
above or a withdrawal of the ratings altogether. In addition, any rating agency
providing a rating for a Fund's Preferred Shares, at any time, may change or
withdraw any such rating. As set forth in the Certificate of Vote of each Fund,
the Board of Trustees of each Fund, without shareholder approval, may modify
certain definitions or restrictions that have been adopted by such Fund pursuant
to the rating agency guidelines, provided the Board of Trustees has obtained
written confirmation from S&P and Moody's that any such change would not impair
the ratings then assigned by S&P and Moody's to the Preferred Shares. For so
long as any shares of a Fund's Preferred Shares are rated by S&P or Moody's, as
the case may be, a Fund's use of options and financial futures contracts and
options thereon will be subject to certain limitations mandated by the rating
agencies.



  REDEMPTIONS. The redemption provisions pertaining to the Preferred Shares of
each Fund are similar. Preferred Shares of each Fund are generally redeemable at
the option of the Fund at a price equal to their liquidation preference plus
accumulated but unpaid dividends (whether or not earned or declared) to the date
of redemption plus, in certain circumstances, a redemption premium. Each Fund's
Preferred Shares are also subject to mandatory redemption at a price equal to
their liquidation preference plus accumulated but unpaid dividends (whether or
not earned or declared) to the date of redemption upon the occurrence of certain
specified events, such as the failure of a Fund to maintain asset coverage
requirements for the Preferred Shares specified by Moody's and S&P in connection
with their issuance of ratings on the Preferred Shares. Additionally, with
respect to the RP, the Target Fund is required to redeem RP if on any dividend
payment date the Target Fund fails to generate sufficient available net
tax-exempt income to pay accrued and unpaid dividends on the RP out of solely
tax-exempt income at the

                                        48
<PAGE>


applicable dividend rate. The liquidation preference per share of the Target
Fund RP is $100,000 and the liquidation preference per share of the Acquiring
Fund APS is $25,000.



  LIQUIDATION RIGHTS. Upon any liquidation, dissolution or winding up of a Fund,
whether voluntary or involuntary, the holders of such Fund's Preferred Shares
will be entitled to receive, out of the assets of such Fund available for
distribution to shareholders, before any distribution or payment is made upon
any of such Fund's common shares or any other capital shares of such Fund
ranking junior in right of payment upon liquidation to Preferred Shares, the
liquidation preference of such Preferred Shares, together with the amount of any
dividends accumulated but unpaid (whether or not earned or declared) thereon to
the date of distribution, and after such payment the holders of Preferred Shares
will be entitled to no other payments except for any Additional Dividends, in
the case of the Acquiring Fund. The liquidation preference per share of the
Target Fund RP is $100,000 and the liquidation preference per share of the
Acquiring Fund APS is $25,000. If such assets of a Fund are insufficient to make
the full liquidation payment on the Preferred Shares and liquidation payments on
any other outstanding class or series of preferred shares of such Fund ranking
on a parity with the Preferred Shares as to payment upon liquidation, then such
assets will be distributed among the holders of Preferred Shares and the holders
of shares of such other class or series ratably in proportion to the respective
preferential amounts to which they are entitled. After payment of the full
amount of liquidation distribution to which they are entitled, the holders of a
Fund's Preferred Shares will not be entitled to any further participation in any
distribution of assets by the Fund except for any Additional Dividends, in the
case of the Acquiring Fund. A consolidation, merger or share exchange of a Fund
with or into any other entity or entities or a sale, whether for cash, shares of
stock, securities or properties, of all or substantially all or any part of the
assets of a Fund shall not be deemed or construed to be a liquidation,
dissolution or winding up of such Fund for this purpose.



  SERIES. Under the 1940 Act, each Fund is permitted to have outstanding more
than one series of preferred shares as long as no single series has priority
over another series as to the distribution of assets of such Fund or the payment
of dividends. The Target Fund currently has one series of RP outstanding. The
Acquiring Fund currently has four series of APS outstanding, Series A APS,
Series B APS, Series C APS and Series D APS. In connection with the
Reorganization, the Acquiring Fund will create a new series, designated Series E
APS, to replace the Target Fund's RP. Four shares of Series E APS, liquidation
preference $25,000 per share, will be issued for each share of Target Fund RP,
liquidation preference $100,000 per share. The number of days in the regular
dividend period for Series E APS will remain the same as for the Target Fund's
RP.


                                        49
<PAGE>


  ADDITIONAL INFORMATION. For additional information regarding Acquiring Fund
APS, Target Fund shareholders should consult the Reorganization Statement of
Additional Information, which contains a more complete summary of the terms of
the Acquiring Fund APS, and the Certificate of Vote governing the Acquiring Fund
APS, included as Appendix B to the Reorganization Statement of Additional
Information. APS issued in connection with the Reorganization will be governed
by the Certificate of Vote of the Acquiring Fund, which, upon completion of the
Reorganization, will be amended to reflect the creation of Series E and the
issuance of additional APS.


GOVERNING LAW

  Each Fund is organized as a business trust under the laws of The Commonwealth
of Massachusetts. The Target Fund was organized on April 14, 1989 and commenced
operations on November 30, 1989; the Acquiring Fund was organized on July, 19
1991 and commenced operations on November 30, 1991.


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


  Each Fund is also subject to federal securities laws, including the 1940 Act
and the rules and regulations promulgated by SEC thereunder, and applicable
state securities laws. Each Fund is registered as a diversified, closed-end
management investment company under the 1940 Act.

CERTAIN PROVISIONS OF THE DECLARATIONS OF TRUST


  Each Fund's Declaration of Trust includes provisions that could have the
effect of limiting the ability of other entities or persons to acquire control
of such Fund or to change the composition of its Board of Trustees, and could
have the effect of depriving common shareholders of an opportunity to sell their
common shares at a premium over prevailing market prices by discouraging a third
party from seeking to obtain control of such Fund. The Board of Trustees of each
Fund is divided into three classes, with the term of one class expiring at the
annual meeting of shareholders. At each annual meeting, each class whose term is
expiring will be elected to a three-year term. This provision could delay for up
to two years the

                                        50
<PAGE>


replacement of a majority of the Board of Trustees. A trustee may be removed
from office only for cause by a written instrument signed by at least two-thirds
of the remaining trustees or by a vote of the holders of at least two-thirds of
the class of shares of the Fund that elected such trustee and entitled to vote
on the matter.



  In addition, each Fund's Declaration of Trust requires the favorable vote of
the holders of at least 75% of the outstanding shares of each class of the Fund
in question, voting as a class, then entitled to vote to approve, adopt or
authorize certain transactions with 5%-or-greater holders of a class of shares
and their associates, unless the Board of Trustees shall by resolution have
approved a memorandum of understanding with such holders, in which case normal
voting requirements would be in effect. For purposes of these provisions, a
5%-or-greater holder of a class of shares (a "Principal Shareholder") refers to
any person who, whether directly or indirectly and whether alone or together
with its affiliates and associates, beneficially owns 5% or more of the
outstanding shares of any class of beneficial interest of such Fund. The
transactions subject to these special approval requirements are: (i) the merger
or consolidation of such Fund or any subsidiary of such Fund with or into any
Principal Shareholder; (ii) the issuance of any securities of such Fund to any
Principal Shareholder for cash (except pursuant to the Dividend Reinvestment
Plan); (iii) the sale, lease or exchange of all or any substantial part of the
assets of such Fund to any Principal Shareholder (except assets having an
aggregate fair market value of less than $1,000,000, aggregating for the purpose
of such computation all assets sold, leased or exchanged in any series of
similar transactions within a twelve-month period); or (iv) the sale, lease or
exchange to such Fund or any subsidiary thereof, in exchange for securities of
such Fund, of any assets of any Principal Shareholder (except assets having an
aggregate fair market value of less than $1,000,000, aggregating for purposes of
such computation all assets sold, leased or exchanged in any series of similar
transactions within a twelve-month period).


  The Board of Trustees of each Fund has determined that the 75% voting
requirements described above, which are greater than the minimum requirements
under Massachusetts law or the 1940 Act, are in the best interest of
shareholders of each respective Fund generally. Reference should be made to the
Declaration of Trust of each Fund on file with the SEC for the full text of
these provisions.


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


                                        51
<PAGE>


officer is entitled to be indemnified against all liability in connection with
the affairs of a Fund.


CONVERSION TO OPEN-END FUND


  Each Fund may be converted to an open-end investment company at any time by an
amendment to its Declaration of Trust. Each Fund's Declaration of Trust provides
that such an amendment would require the approval of (a) a majority of the
trustees, including the approval by a majority of the disinterested trustees of
the applicable Fund, and (b) the lesser of (i) more than 50% of the Fund's
outstanding common and preferred shares, each voting as a class or (ii) 67% of
the common and preferred shares, each voting as a class, present at a meeting at
which holders of more than 50% of the outstanding shares of each such class are
present in person or by proxy. If approved in the foregoing manner, conversion
of the Fund could not occur until 90 days after the shareholders' meeting at
which such conversion was approved and would also require at least 30 days prior
notice to all shareholders. Conversion of a Fund to an open-end investment
company would require the redemption of all outstanding Preferred Shares, which
would eliminate the leveraged capital structure of such Fund. In the event of
conversion, the common shares would cease to be listed on the NYSE, AMEX, CHX,
NASDAQ National Market System or other national securities exchange or national
market system. Shareholders of an open-end investment company may require the
company to redeem their shares at any time (except in certain circumstances as
authorized by or under the 1940 Act) at their net asset value, less such
redemption charge, if any, as might be in effect at the time of a redemption. If
a Fund were converted to an open-end fund, it is likely that new common shares
would be sold at net asset value plus a sales load. Following any such
conversion, it is also possible that certain of such Fund's investment policies
and strategies would have to be modified to assure sufficient portfolio
liquidity. In particular such Fund would be required to maintain its portfolio
such that not more than 15% of its assets would be invested in illiquid
securities. Such requirement could cause such Fund to dispose of portfolio
securities or other assets at a time when it is not advantageous to do so, and
could adversely affect the ability of such Fund to meet its investment
objective.


VOTING RIGHTS


  Voting rights are identical for the holders of each Fund's common shares.
Holders of each Fund's common shares are entitled to one vote for each share
held. Except as set forth above under "Certain Provisions of the Declarations of
Trust" or "Conversion to Open-End Fund," or except as expressly required by
applicable law or expressly set forth in the designation of rights and
preferences with respect to a Fund's Preferred Shares, holders of Preferred
Shares have no voting rights. When holders of a Fund's Preferred Shares are
entitled to vote, they are also entitled to cast one vote per share held.

                                        52
<PAGE>


  Holders of Preferred Shares of a Fund, voting as a class, are entitled to
elect two of each Fund's trustees. Under the 1940 Act, if at any time dividends
on a Fund's Preferred Shares are unpaid in an amount equal to two full years
dividends thereon, the holders of all outstanding Preferred Shares, voting as a
class, are entitled to elect a majority of such Fund's trustees until all
dividends have been paid or declared and set apart for payment.



  The Certificate of Vote establishing the Preferred Shares of each Fund
provides that such Fund shall not take certain actions relating to the
preferences, rights or powers of holders of such Fund's Preferred Shares without
the affirmative vote of the holders of a majority of the outstanding Preferred
Shares. Additionally, if the Acquiring Fund has more than one series of
Preferred Shares outstanding, an affirmative vote of a majority of the
outstanding shares of each series of Preferred Shares, each voting separately as
a class, is required with respect to any matter that materially affects the
series in a manner different from that of other series of such Fund's Preferred
Shares. The specific provisions of each Fund's Certificate of Vote with respect
to the voting rights of holders of Preferred Shares may differ and Target Fund
shareholders should consult the Certificate of Vote governing the Acquiring Fund
APS, included as Appendix B to the Reorganization Statement of Additional
Information.


                                        53
<PAGE>

FINANCIAL HIGHLIGHTS

  TARGET FUND. The following schedule presents financial highlights for one
Target Fund Common Share outstanding throughout the periods indicated.
<Table>
<Caption>
                                                               YEAR ENDED OCTOBER 31,
                                     --------------------------------------------------------------------------
                                       2004       2003     2002(A)      2001       2000       1999       1998
                                       ----       ----     -------      ----       ----       ----       ----
<S>                                  <C>        <C>        <C>        <C>        <C>        <C>        <C>
NET ASSET VALUE, BEGINNING OF THE
 PERIOD............................  $  10.15   $   9.97   $  10.01   $   9.43   $   9.39   $  10.66   $  10.66
                                     --------   --------   --------   --------   --------   --------   --------
 Net Investment Income.............       .61        .63        .65        .67        .76        .83        .86
 Net Realized and Unrealized
  Gain/Loss........................       .15        .10       (.13)       .59        .09      (1.26)       .01
 Common Share Equivalent of
  Distributions Paid to Preferred
  Shareholders:
  Net Investment Income............      (.06)      (.06)      (.07)      (.18)      (.21)      (.17)      (.19)
                                     --------   --------   --------   --------   --------   --------   --------
Total from Investment Operations...       .70        .67        .45       1.08        .64       (.60)       .68
Distributions Paid to Common
 Shareholders:
 Net Investment Income.............      (.49)      (.49)      (.49)      (.50)      (.60)      (.67)      (.68)
                                     --------   --------   --------   --------   --------   --------   --------
NET ASSET VALUE, END OF THE
 PERIOD............................  $  10.36   $  10.15   $   9.97   $  10.01   $   9.43   $   9.39   $  10.66
                                     ========   ========   ========   ========   ========   ========   ========
Common Share Market Price at End of
 the Period........................  $   9.07   $   8.96   $   8.69   $   8.70   $   8.08   $ 8.8125   $11.0625
Total Return(b)....................     6.85%      8.91%      5.64%     14.11%     -1.60%    -15.09%      7.63%
Net Assets Applicable to Common
 Shares at End of the Period (In
 millions).........................  $   50.1   $   49.1   $   48.2   $   48.4   $   45.6   $   45.4   $   51.6
Ratio of Expenses to Average Net
 Assets Applicable to Common
 Shares(c).........................     1.53%      1.49%      1.42%      1.46%      1.52%      1.69%      1.47%
Ratio of Net Investment Income to
 Average Net Assets Applicable to
 Common Shares(c)..................     5.99%      6.19%      6.62%      6.77%      8.25%      8.11%      8.14%
Portfolio Turnover.................       19%        36%        37%        45%        41%        46%        33%
SUPPLEMENTAL RATIOS:
Ratio of Expenses to Average Net
 Assets Including Preferred
 Shares(c).........................     1.01%       .99%       .93%       .96%       .98%      1.12%       .99%
Ratio of Net Investment Income to
 Average Net Assets Applicable to
 Common Shares(d)..................     5.42%      5.64%      5.87%      4.98%      5.92%      6.41%      6.40%
SENIOR SECURITIES:
Total Preferred Shares
 Outstanding.......................       250        250        250        250        250        250        250
Asset Coverage Per Preferred
 Share(e)..........................  $300,616   $296,504   $292,949   $293,730   $282,465   $281,691   $306,365
Involuntary Liquidating Preference
 Per Preferred Share...............  $100,000   $100,000   $100,000   $100,000   $100,000   $100,000   $100,000
Average Market Value Per Preferred
 Share.............................  $100,000   $100,000   $100,000   $100,000   $100,000   $100,000   $100,000

<Caption>
                                         YEAR ENDED OCTOBER 31,
                                     ------------------------------
                                       1997       1996       1995
                                       ----       ----       ----
<S>                                  <C>        <C>        <C>
NET ASSET VALUE, BEGINNING OF THE
 PERIOD............................  $  10.47   $  10.75   $  10.50
                                     --------   --------   --------
 Net Investment Income.............       .96        .88        .88
 Net Realized and Unrealized
  Gain/Loss........................       .12       (.19)       .40
 Common Share Equivalent of
  Distributions Paid to Preferred
  Shareholders:
  Net Investment Income............      (.18)      (.19)      (.20)
                                     --------   --------   --------
Total from Investment Operations...       .90        .50       1.08
Distributions Paid to Common
 Shareholders:
 Net Investment Income.............      (.71)      (.78)      (.83)
                                     --------   --------   --------
NET ASSET VALUE, END OF THE
 PERIOD............................  $  10.66   $  10.47   $  10.75
                                     ========   ========   ========
Common Share Market Price at End of
 the Period........................  $10.9375   $  11.00   $ 10.625
Total Return(b)....................     6.13%     11.02%      2.88%
Net Assets Applicable to Common
 Shares at End of the Period (In
 millions).........................  $   51.6   $   50.7   $   52.0
Ratio of Expenses to Average Net
 Assets Applicable to Common
 Shares(c).........................     1.47%      1.51%      1.52%
Ratio of Net Investment Income to
 Average Net Assets Applicable to
 Common Shares(c)..................     9.14%      8.32%      8.22%
Portfolio Turnover.................       25%        39%        50%
SUPPLEMENTAL RATIOS:
Ratio of Expenses to Average Net
 Assets Including Preferred
 Shares(c).........................      .99%      1.01%      1.02%
Ratio of Net Investment Income to
 Average Net Assets Applicable to
 Common Shares(d)..................     7.38%      6.55%      6.31%
SENIOR SECURITIES:
Total Preferred Shares
 Outstanding.......................       250        250        250
Asset Coverage Per Preferred
 Share(e)..........................  $306,303   $302,730   $308,150
Involuntary Liquidating Preference
 Per Preferred Share...............  $100,000   $100,000   $100,000
Average Market Value Per Preferred
 Share.............................  $100,000   $100,000   $100,000
</Table>

(a) As required, effective November 1, 2001, the Trust has adopted the
    provisions of the AICPA Audit and Accounting Guide for Investment Companies
    and began accreting market discount on fixed income securities. The effect
    of this change for the year ended October 31, 2002 was to increase net
    investment income per share by less than $.01, decrease net realized and
    unrealized gains and losses per share by less than $.01 and increase the
    ratio of net investment income to average net assets by .01%. Per share,
    ratios, and supplemental data for periods prior to October 31, 2002 have not
    been restated to reflect this change in presentation.
(b) Total return assumes an investment at the common share market price at the
    beginning of the period indicated, reinvestment of all distributions for the
    period in accordance with the Trust's dividend reinvestment plan, and sale
    of all shares at the closing common share price at the end of the period
    indicated.
(c) Ratios do not reflect the effect of dividend payments to preferred
    shareholders.
(d) Ratios reflect the effect of dividend payments to preferred shareholders.
(e) Calculated by subtracting the Trust's total liabilities (not including the
    preferred shares) from the Trust's total assets and dividing this by the
    number of preferred shares outstanding.

                                        54
<PAGE>

  ACQUIRING FUND. The following schedule presents financial highlights for one
Acquiring Fund Common Share outstanding throughout the periods indicated.

<Table>
<Caption>
                                                                                                  TWO MONTHS
                                                       YEAR ENDED OCTOBER 31,                        ENDED
                                     ----------------------------------------------------------   OCTOBER 31,
                                      2004      2003     2002(A)    2001      2000       1999        1998
                                      ----      ----     -------    ----      ----       ----     -----------
<S>                                  <C>       <C>       <C>       <C>       <C>       <C>        <C>
NET ASSET VALUE, BEGINNING OF THE
 PERIOD............................  $ 16.25   $ 16.12   $16.07    $ 14.91   $ 14.60   $  17.39    $  17.32
                                     -------   -------   -------   -------   -------   --------    --------
 Net Investment Income.............     1.03      1.02     1.06       1.13      1.17       1.20         .21
 Net Realized and Unrealized
  Gain/Loss........................      .37       .13      .01       1.12       .42      (2.30)        .08
 Common Share Equivalent of
 Distributions Paid to Preferred
 Shareholders:
  Net Investment Income............     (.09)     (.08)    (.11)      (.27)     (.34)      (.24)       (.02)
  Net Realized Gain................      -0-(f)     -0-     -0-        -0-       -0-       (.06)       (.04)
                                     -------   -------   -------   -------   -------   --------    --------
Total from Investment Operations...     1.31      1.07      .96       1.98      1.25      (1.40)        .23
Distributions Paid to Common
 Shareholders:
  Net Investment Income............     (.94)     (.94)    (.91)      (.82)     (.94)      (.96)       (.16)
  Net Realized Gain................     (.02)      -0-      -0-        -0-       -0-       (.43)        -0-
                                     -------   -------   -------   -------   -------   --------    --------
NET ASSET VALUE, END OF THE
 PERIOD............................  $ 16.60   $ 16.25   $16.12    $ 16.07   $ 14.91   $  14.60    $  17.39
                                     =======   =======   =======   =======   =======   ========    ========
Common Share Market Price at End of
 the Period........................  $ 14.90   $ 14.57   $14.30    $ 13.79   $12.625   $13.1875    $16.8125
Total Return (b)...................    9.15%     8.60%   10.49%     15.97%     2.80%    -14.47%       4.84%*
Net Assets Applicable to Common
 Shares at End of the Period (In
 millions).........................  $ 603.6   $ 590.9   $586.2    $ 584.4   $ 542.1   $  530.9    $  630.6
Ratio of Expenses to Average Net
 Assets Applicable to Common
 Shares(c).........................    1.19%     1.23%    1.35%      1.55%     1.67%      1.60%       1.57%
Ratio of Net Investment Income to
 Average Net Assets Applicable to
 Common Shares(c)..................    6.24%     6.28%    6.70%      7.26%     8.07%      7.43%       7.20%
Portfolio Turnover.................      19%       24%      38%        28%       39%        80%          6%*
SUPPLEMENTAL RATIOS:
Ratio of Expenses to Average Net
 Assets Including Preferred
 Shares(c).........................     .79%      .81%     .89%      1.01%     1.07%      1.06%       1.07%
Ratio of Net Investment Income to
 Average Net Assets Applicable to
 Common Shares(d)..................    5.70%     5.77%    5.98%      5.51%     5.71%      5.95%       6.48%
SENIOR SECURITIES:
Total Preferred Shares
 Outstanding.......................   12,000    12,000   12,000     12,000    12,000     12,000       6,000
Asset Coverage Per Preferred
 Share(e)..........................  $75,312   $74,245   $73,861   $73,700   $70,177   $ 69,241    $155,104
Involuntary Liquidating Preference
 Per Preferred Share...............  $25,000   $25,000   $25,000   $25,000   $25,000   $ 25,000    $ 50,000
Average Market Value Per Preferred
 Share.............................  $25,000   $25,000   $25,000   $25,000   $25,000   $ 25,000    $ 50,000

<Caption>

                                               YEAR ENDED AUGUST 31,
                                     -----------------------------------------
                                       1998       1997       1996       1995
                                       ----       ----       ----       ----
<S>                                  <C>        <C>        <C>        <C>
NET ASSET VALUE, BEGINNING OF THE
 PERIOD............................  $  16.60   $  15.84   $  15.73   $  15.56
                                     --------   --------   --------   --------
 Net Investment Income.............      1.26       1.28       1.30       1.31
 Net Realized and Unrealized
  Gain/Loss........................       .72        .73        .10        .26
 Common Share Equivalent of
 Distributions Paid to Preferred
 Shareholders:
  Net Investment Income............      (.30)      (.29)      (.30)      (.32)
  Net Realized Gain................       -0-        -0-        -0-        -0-
                                     --------   --------   --------   --------
Total from Investment Operations...      1.68       1.72       1.10       1.25
Distributions Paid to Common
 Shareholders:
  Net Investment Income............      (.96)      (.96)      (.99)     (1.08)
  Net Realized Gain................       -0-        -0-        -0-        -0-
                                     --------   --------   --------   --------
NET ASSET VALUE, END OF THE
 PERIOD............................  $  17.32   $  16.60   $  15.84   $  15.73
                                     ========   ========   ========   ========
Common Share Market Price at End of
 the Period........................  $16.1875   $  15.75   $  14.50   $  14.25
Total Return (b)...................     9.06%     15.87%      8.98%      2.39%
Net Assets Applicable to Common
 Shares at End of the Period (In
 millions).........................  $  628.2   $  601.9   $  574.6   $  570.7
Ratio of Expenses to Average Net
 Assets Applicable to Common
 Shares(c).........................     1.57%      1.61%      1.61%      1.65%
Ratio of Net Investment Income to
 Average Net Assets Applicable to
 Common Shares(c)..................     7.42%      7.86%      8.08%      8.58%
Portfolio Turnover.................       94%        54%        36%        49%
SUPPLEMENTAL RATIOS:
Ratio of Expenses to Average Net
 Assets Including Preferred
 Shares(c).........................     1.06%      1.07%      1.06%      1.07%
Ratio of Net Investment Income to
 Average Net Assets Applicable to
 Common Shares(d)..................     5.66%      6.04%      6.20%      6.48%
SENIOR SECURITIES:
Total Preferred Shares
 Outstanding.......................     6,000      6,000      6,000      6,000
Asset Coverage Per Preferred
 Share(e)..........................  $154,696   $150,322   $145,764   $145,113
Involuntary Liquidating Preference
 Per Preferred Share...............  $ 50,000   $ 50,000   $ 50,000   $ 50,000
Average Market Value Per Preferred
 Share.............................  $ 50,000   $ 50,000   $ 50,000   $ 50,000
</Table>



* Non-Annualized


(a) As required, effective November 1, 2001, the Trust has adopted the
    provisions of the AICPA Audit and Accounting Guide for Investment Companies
    and began accreting market discount on fixed income securities. The effect
    of this change for the year ended October 31, 2002 was to increase net
    investment income per share by $.01, decrease net realized and unrealized
    gains and losses per share by $.01 and increase the ratio of net investment
    income to average net assets applicable to common shares from 6.69% to
    6.70%. Per share, ratios and supplemental data for periods prior to October
    31, 2002 have not been restated to reflect this change in presentation.

(b) Total return assumes an investment at the common share market price at the
    beginning of the period indicated, reinvestment of all distributions for the
    period in accordance with the Trust's dividend reinvestment plan, and sale
    of all shares at the closing common share market price at the end of the
    period indicated.

(c) Ratios do not reflect the effect of dividend payments to preferred
    shareholders.

(d) Ratios reflect the effect of dividend payments to preferred shareholders.

(e) Calculated by subtracting the Trust's total liabilities (not including the
    preferred shares) from the Trust's total assets and dividing this by the
    number of preferred shares outstanding.

(f) Amount is less than $0.01 per share.

                                        55
<PAGE>

                      INFORMATION ABOUT THE REORGANIZATION

GENERAL


  Under the Agreement and Plan of Reorganization (a form of which is attached as
Appendix A to the Reorganization Statement of Additional Information), the
Acquiring Fund will acquire substantially all of the assets, and will assume
substantially all of the liabilities, of the Target Fund, in exchange for
Acquiring Fund Common Shares and Acquiring Fund Series E APS to be issued by the
Acquiring Fund. The Acquiring Fund will issue and cause to be listed on the NYSE
and CHX additional Acquiring Fund Common Shares. The Acquiring Fund Common
Shares issued to the Target Fund will have an aggregate net asset value equal to
the aggregate net asset value of the Target Fund Common Shares, less the costs
of the Reorganization (though cash may be paid in lieu of any fractional
shares). The shares of Series E Acquiring Fund APS issued to the Target Fund
will have an aggregate liquidation preference equal to the aggregate liquidation
preference of the Target Fund RP. Upon receipt by the Target Fund of such
shares, the Target Fund will (i) distribute the Acquiring Fund Common Shares to
the holders of Target Fund Common Shares and (ii) distribute the Series E
Acquiring Fund APS to the holders of Target Fund RP. As soon as practicable
after the Closing Date for the Reorganization, the Target Fund will deregister
as an investment company under the 1940 Act and dissolve under applicable state
law.



  The Target Fund will distribute the Acquiring Fund Common Shares and the
Series E Acquiring Fund APS received by it pro rata to its holders of record of
Target Fund Common Shares and Target Fund RP, as applicable, in exchange for
such shareholders' shares in the Target Fund. Such distribution will be
accomplished by opening new accounts on the books of the Acquiring Fund in the
names of the common and preferred shareholders of the Target Fund and
transferring to those shareholder accounts the Acquiring Fund Common Shares and
the Acquiring Fund APS previously credited on those books to the accounts of the
Target Fund. Each newly-opened account on the books of the Acquiring Fund for
the former common shareholders of the Target Fund will represent the respective
pro rata number of Acquiring Fund Common Shares (rounded down, in the case of
fractional shares held other than in a Dividend Reinvestment Plan account, to
the next largest number of whole shares) due such shareholder. No fractional
Acquiring Fund Common Shares will be issued (except for shares held in a Plan
account). In the event of fractional shares in an account other than a Plan
account, the Acquiring Fund's transfer agent will aggregate all such fractional
Acquiring Fund Common Shares and sell the resulting whole shares on the NYSE for
the account of all holders of such fractional interests, and each such holder
will be entitled to the pro rata share of the proceeds from such sale upon
surrender of the Target Fund Common Share certificates. Similarly, each
newly-opened account on the books of the Acquiring Fund for the former preferred
shareholder of Target Fund RP would represent the respective pro rata number of
Acquiring Fund APS due such shareholder. See

                                        56
<PAGE>


"Terms of the Agreement and Plan of Reorganization -- Surrender and Exchange of
Share Certificates" below for a description of the procedures to be followed by
Target Fund shareholders to obtain their Acquiring Fund Common Shares or
Acquiring Fund APS (and cash in lieu of fractional shares, if any).



  As a result of the Reorganization, every holder of Target Fund Common Shares
would own Acquiring Fund Common Shares that (except for cash payments received
in lieu of fractional shares) will have an aggregate net asset value immediately
after the Closing Date equal to the aggregate net asset value of that
shareholder's Target Fund Common Shares immediately prior to the Closing Date
less the costs of the Reorganization. Since the Acquiring Fund Common Shares
will be issued at net asset value in exchange for the net assets of the Target
Fund having a value equal to the aggregate net asset value of those Acquiring
Fund Common Shares, the net asset value per share of Acquiring Fund Common
Shares should remain virtually unchanged by the Reorganization except for its
share (if any) of the reorganizational costs. Similarly, the aggregate
liquidation preference of the Acquiring Fund APS to be issued to the Target Fund
will equal the aggregate liquidation preference of the Target Fund RP. Each
holder of Target Fund RP will receive Acquiring Fund APS that will have an
aggregate liquidation preference immediately after the Closing Date equal to the
aggregate liquidation preference of that shareholder's Target Fund RP
immediately prior to the Closing Date. The liquidation preference per share of
the Acquiring Fund APS will remain unchanged by the Reorganization. Thus, the
Reorganization will result in no dilution of net asset value of the Target Fund
Common Shares or Acquiring Fund Common Shares, other than to reflect the costs
of the Reorganization, and will result in no dilution of the value per share of
Acquiring Fund APS or Target Fund RP. However, as a result of the
Reorganization, a shareholder of either Fund will hold a reduced percentage of
ownership in the larger combined entity than he or she did in either of the
separate Funds.



  No sales charge or fee of any kind will be charged to shareholders of the
Target Fund in connection with their receipt of Acquiring Fund Common Shares or
Acquiring Fund APS in the Reorganization. Holders of Target Fund RP will find
that the auction dates and dividend payment dates for the Acquiring Fund APS
received in the Reorganization are ordinarily (i.e., except in the case of a
special dividend period) on a 28 day schedule similar to the 28 day remarketing
schedule in the case of RP. The auction or remarketing procedures for the RP and
APS of the Funds are similar. As a result of the Reorganization, the last
dividend period for the Target Fund RP prior to the Closing Date and the initial
dividend period for the Acquiring Fund APS issued in connection with the
Reorganization after the Closing Date may be shorter than the ordinary dividend
period for such shares.


                                        57
<PAGE>


TERMS OF THE AGREEMENT AND PLAN OF REORGANIZATION



  The following is a summary of the significant terms of the Agreement and Plan
of Reorganization. This summary is qualified in its entirety by reference to the
Agreement and Plan of Reorganization, attached as Appendix A to the
Reorganization Statement of Additional Information.



  VALUATION OF ASSETS AND LIABILITIES. The respective assets of each of the
Funds will be valued on the business day prior to the Closing Date (the
"Valuation Date"). The valuation procedures are the same for each Fund: the net
asset value per common share of each Fund will be determined after the close of
business on the NYSE (generally 4:00 p.m. Eastern time) on the Valuation Date.
For the purpose of determining the net asset value of a Common Share of each
Fund, the value of the securities held by the issuing Fund plus any cash or
other assets (including interest accrued but not yet received) minus all
liabilities (including accrued expenses) and the aggregate liquidation value of
the outstanding APS of the issuing Fund is divided by the total number of common
shares of the issuing Fund outstanding at such time. Daily expenses, including
the fees payable to the Adviser, will accrue on the Valuation Date.



  AMENDMENTS AND CONDITIONS. The Agreement and Plan of Reorganization may be
amended at any time prior to the Closing Date with respect to any of the terms
therein. The obligations of each Fund pursuant to the Agreement and Plan of
Reorganization are subject to various conditions, including a registration
statement on Form N-14 being declared effective by the SEC, approval by the
shareholders of the Target Fund, receipt of an opinion of counsel as to tax
matters, receipt of an opinion of counsel as to corporate and securities matters
and the continuing accuracy of various representations and warranties of the
Funds being confirmed by the respective parties.



  POSTPONEMENT; TERMINATION. Under the Agreement and Plan of Reorganization, the
Board of Trustees of either Fund may cause the Reorganization to be postponed or
abandoned in certain circumstances should such Board determine that it is in the
best interests of the shareholders of its respective Fund to do so.



  The Agreement and Plan of Reorganization may be terminated, and the
Reorganization abandoned at any time (whether before or after adoption thereof
by the shareholders of either of the Funds) prior to the Closing Date, or the
Closing Date may be postponed: (i) by mutual consent of the Boards of Trustees
of the Funds and (ii) by the Board of Trustees of either Fund if any condition
to that Fund's obligations set forth in the Agreement and Plan of Reorganization
has not been fulfilled or waived by such Board.


  SURRENDER AND EXCHANGE OF SHARE CERTIFICATES. After the Closing Date, each
holder of an outstanding certificate or certificates formerly representing
Target Fund Common Shares will be entitled to receive, upon surrender of his or
her
                                        58
<PAGE>


certificate or certificates, a certificate or certificates representing the
number of Acquiring Fund Common Shares distributable with respect to such
holder's Target Fund Common Shares, together with cash in lieu of any fractional
Acquiring Fund Common Shares held other than in a Dividend Reinvestment Plan
account. Promptly after the Closing Date, the transfer agent for the Acquiring
Fund Common Shares will mail to each holder of certificates formerly
representing Target Fund Common Shares a letter of transmittal for use in
surrendering his or her certificates for certificates representing Acquiring
Fund Common Shares and cash in lieu of any fractional shares held other than in
a Plan account.


  Please do not send in any share certificates at this time. Upon consummation
of the Reorganization, holders of Target Fund Common Shares will be furnished
with instructions for exchanging their share certificates for Acquiring Fund
share certificates and, if applicable, cash in lieu of fractional shares.


  From and after the Closing Date, certificates formerly representing Target
Fund Common Shares will be deemed for all purposes to evidence ownership of the
number of full Acquiring Fund Common Shares distributable with respect to the
Target Fund Common Shares held before the Reorganization, as described above,
provided that, until such share certificates have been so surrendered, no
dividends payable to the holders of record of Target Fund Common Shares as of
any date subsequent to the Closing Date will be reinvested pursuant to the
Acquiring Fund's Dividend Reinvestment Plan, but will instead be paid in cash.
Once such Target Fund share certificates have been surrendered, participants in
the Target Fund's Dividend Reinvestment Plan will automatically be enrolled in
the Dividend Reinvestment Plan of the Acquiring Fund.



  From and after the Closing Date, there will be no transfers on the share
transfer books of the Target Fund. If, after the Closing Date, certificates
representing Target Fund Common Shares are presented to the Acquiring Fund, they
will be cancelled and exchanged for certificates representing Acquiring Fund
Common Shares and cash in lieu of fractional shares, if applicable,
distributable with respect to such Target Fund Common Shares in the
Reorganization.


  Preferred Shares are held in "street name" by the Depository Trust Company and
all transfers will be accomplished by book entry.


EXPENSES OF THE REORGANIZATION



  In the event the Reorganization is approved and completed, the expenses of the
Reorganization will be shared by the Target Fund and the Acquiring Fund in
proportion to their projected declines in total operating expenses as a result
of the Reorganization. In the event the Reorganization is not completed, the
Adviser will bear the costs associated with the Reorganization.


                                        59
<PAGE>


  Expenses incurred in connection with the Reorganization include, but are not
limited to: all costs related to the preparation and distribution of materials
distributed to each Fund's Board; all expenses incurred in connection with the
preparation of the Agreement and Plan of Reorganization and a registration
statement on Form N-14; SEC and state securities commission filing fees and
legal and audit fees in connection with the Reorganization; the costs of
printing and distributing this Proxy Statement/Prospectus; legal fees incurred
preparing materials for the Board of each Fund, attending each Fund's Board
meetings and preparing the minutes; auditing fees associated with each Fund's
financial statements; portfolio transfer taxes (if any); and any similar
expenses incurred in connection with the Reorganization. Neither the Funds nor
the Adviser will pay any expenses of shareholders arising out of or in
connection with the Reorganization.


MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE REORGANIZATION


  The following is a general summary of the material anticipated U.S. federal
income tax consequences of the Reorganization. The discussion is based upon the
Internal Revenue Code, Treasury regulations, court decisions, published
positions of the Internal Revenue Service ("IRS") and other applicable
authorities, all as in effect on the date hereof and all of which are subject to
change or differing interpretations (possibly with retroactive effect). The
discussion is limited to U.S. persons who hold shares of the Target Fund as
capital assets for U.S. federal income tax purposes (generally, assets held for
investment). This summary does not address all of the U.S. federal income tax
consequences that may be relevant to a particular shareholder or to shareholders
who may be subject to special treatment under U.S. federal income tax laws. No
ruling has been or will be obtained from the IRS regarding any matter relating
to the Reorganization. No assurance can be given that the IRS would not assert,
or that a court would not sustain, a position contrary to any of the tax aspects
described below. Prospective investors must consult their own tax advisers as to
the U.S. federal income tax consequences of the Reorganization, as well as the
effects of state, local and non-U.S. tax laws.


  It is a condition to closing the Reorganization that each of the Target Fund
and the Acquiring Fund receives an opinion from Skadden, Arps, Slate, Meagher &
Flom LLP ("Skadden Arps"), dated as of the Closing Date, regarding the
characterization of the Reorganization as a "reorganization" within the meaning
of Section 368(a) of the Internal Revenue Code. As such a reorganization, the
U.S. federal income tax consequences of the Reorganization can be summarized as
follows:


  - No gain or loss will be recognized by the Target Fund or the Acquiring Fund
    upon the transfer to the Acquiring Fund of substantially all of the assets
    of the Target Fund in exchange for Acquiring Fund Common Shares and
    Acquiring Fund APS and the assumption by the Acquiring Fund of substantially
    all of the


                                        60
<PAGE>

    liabilities of the Target Fund and the subsequent liquidation of the Target
    Fund.


  - No gain or loss will be recognized by a shareholder of the Target Fund who
    exchanges, as the case may be, all of his, her or its Target Fund Common
    Shares for Acquiring Fund Common Shares pursuant to the Reorganization or
    all of his, her or its Target Fund RP solely for Acquiring Fund APS pursuant
    to the Reorganization (except with respect to cash received in lieu of a
    fractional share of the Acquiring Fund, as discussed below).


  - The aggregate tax basis of the Acquiring Fund Common Shares or Acquiring
    Fund APS, as the case may be, received by a shareholder of the Target Fund
    pursuant to the Reorganization will be the same as the aggregate tax basis
    of the shares of the Target Fund surrendered in exchange therefor (reduced
    by any amount of tax basis allocable to a fractional share for which cash is
    received).


  - The holding period of the Acquiring Fund Common Shares or Acquiring Fund
    APS, as the case may be, received by a shareholder of the Target Fund
    pursuant to the Reorganization will include the holding period of the shares
    of the Target Fund surrendered in exchange therefor.



  - A shareholder of the Target Fund that receives cash in lieu of a fractional
    share of the Acquiring Fund pursuant to the Reorganization will recognize
    capital gain or loss with respect to the fractional share in an amount equal
    to the difference between the amount of cash received for the fractional
    share and the portion of such shareholder's tax basis in its Target Fund
    shares that is allocable to the fractional share. The capital gain or loss
    will be long-term if the holding period for such Target Fund Common Shares
    is more than one year as of the date of the exchange.


  - The Acquiring Fund's tax basis in the Target Fund's assets received by the
    Acquiring Fund pursuant to the Reorganization will equal the tax basis of
    such assets in the hands of the Target Fund immediately prior to the
    Reorganization, and the Acquiring Fund's holding period of such assets will
    include the period during which the assets were held by the Target Fund.

  The Acquiring Fund intends to continue to be taxed under the rules applicable
to regulated investment companies as defined in Section 851 of the Internal
Revenue Code, which are the same rules currently applicable to the Target Fund
and its shareholders.


  The opinion of Skadden Arps will be based on federal income tax law in effect
on the Closing Date. In rendering its opinion, Skadden Arps will also rely upon
certain representations of the management of the Acquiring Fund and the Target
Fund and assume, among other things, that the Reorganization will be consummated
in


                                        61
<PAGE>


accordance with the Agreement and Plan of Reorganization and as described
herein. An opinion of counsel is not binding on the IRS or any court.


  Pursuant to the grandfather relief granted in Revenue Ruling 89-81, 1989-1
C.B. 226, Target Fund is permitted to designate that dividends paid on the
Target Fund RP consist of more than the Target Fund RP's pro rata share of
tax-exempt income earned by the Target Fund. The Acquiring Fund, however, is not
eligible to make such disproportionate designations. Accordingly, designations
made by the Acquiring Fund with respect to dividends paid on the Acquiring Fund
APS will be treated as consisting of a pro rata portion of each type of income
so designated.


  The Acquiring Fund will succeed to the capital loss carryforwards of the
Target Fund, which will be subject to the limitations described below. The
Target Fund has capital loss carryforwards that, in the absence of the
Reorganization, would generally be available to offset its capital gains. As a
result of the Reorganization, however, the Target Fund will undergo an
"ownership change" for tax purposes (because the Target Fund is significantly
smaller than the Acquiring Fund), and accordingly, the use of capital loss
carryforwards of the Target Fund (and certain built-in losses) will be limited
by the operation of the tax loss limitations rules of the Code. The Code
generally limits the amount of pre-ownership change losses that may be used to
offset post-ownership change gains to an "annual loss limitation amount"
(generally the product of the net asset value of the Target Fund immediately
prior to the ownership change and a rate established by the IRS for the month in
which the Reorganization occurs (for example, such rate is 4.27% for March
2005). Subject to certain limitations, any unused portion of the "annual loss
limitation amount" may be available in subsequent years, subject to the overall
eight-year capital loss carryforward limit, as measured from the date of
recognition. In addition, for five years after the Closing Date, the combined
fund will not be allowed to offset certain pre-Reorganization built-in gains
attributable to one Fund with capital loss carryforwards (and certain built-in
losses) attributable to the other Fund.



SHAREHOLDER APPROVAL



  Under the Declaration of Trust of the Target Fund (as amended to date and
including the Certificate of Vote of the Target Fund), relevant Massachusetts
law and the rules of the NYSE and CHX, shareholder approval of the Agreement and
Plan of Reorganization requires the affirmative vote of shareholders of the
Target Fund representing more than 50% of the outstanding Target Fund Common
Shares and Target Fund RP, each voting separately as a class.


                                        62
<PAGE>

 ------------------------------------------------------------------------------
                               OTHER INFORMATION
 ------------------------------------------------------------------------------

VOTING INFORMATION AND REQUIREMENTS


  GENERAL. A list of shareholders of the Target Fund entitled to be present and
vote at the Special Meeting will be available at the offices of the Target Fund,
1 Parkview Plaza, Oakbrook Terrace, Illinois 60181-5555, for inspection by any
shareholder during regular business hours for ten days prior to the date of the
Special Meeting.



  RECORD DATE. The Board of Trustees of the Target Fund has fixed the close of
business on April 25, 2005 as the record date (the "Record Date") for the
determination of shareholders entitled to notice of, and to vote at, the Special
Meeting or any adjournment thereof. Shareholders on the Record Date will be
entitled to one vote for each share held, with no shares having cumulative
voting rights. At the Record Date, the Target Fund had outstanding 4,839,000
Target Fund Common Shares and 250 Target Fund RP.



  PROXIES. Target Fund shareholders may vote by appearing in person at the
Special Meeting, by returning the enclosed proxy card or by casting their vote
via telephone or the internet using the instructions provided on the enclosed
proxy card and more fully described below. Shareholders of the Target Fund have
the opportunity to submit their voting instructions via the internet by
utilizing a program provided by a third-party vendor hired by the Target Fund,
or by "touch-tone" telephone voting. The giving of such a proxy will not affect
your right to vote in person should you decide to attend the Special Meeting. To
use the internet, please access the internet address found on your proxy card.
To record your voting instructions by automated telephone, please call the
toll-free number listed on your proxy card. The internet and automated telephone
voting instructions are designed to authenticate shareholder identities, to
allow shareholders to give their voting instructions, and to confirm that
shareholders' instructions have been recorded properly. Shareholders submitting
their voting instructions via the internet should understand that there may be
costs associated with internet access, such as usage charges from internet
access providers and telephone companies, that must be borne by the
shareholders. Any person giving a proxy may revoke it at any time prior to its
exercise by giving written notice of the revocation to the Secretary of the
Target Fund at the address indicated above, by delivering a duly executed proxy
bearing a later date, by recording later-dated voting instructions via the
internet or automated telephone, or by attending the Special Meeting and voting
in person. The giving of a proxy will not affect your right to vote in person if
you attend the Special Meeting and wish to do so.


  All properly executed proxies received prior to the Special Meeting will be
voted in accordance with the instructions marked thereon or otherwise as
provided

                                        63
<PAGE>

therein. Unless instructions to the contrary are marked, proxies will be voted
"FOR" the approval of the proposed Reorganization.


  Abstentions and broker non-votes (i.e., where a nominee, such as a broker
holding shares for beneficial owners, votes on certain matters pursuant to
discretionary authority or instructions from beneficial owners, but with respect
to one or more proposals does not receive instructions from beneficial owners or
does not exercise discretionary authority) are not treated as votes "FOR" the
proposed Reorganization and have the same effect as votes "AGAINST" the proposed
Reorganization since approval of the proposed Reorganization is based on the
affirmative vote of a majority of the total shares outstanding. A majority of
the outstanding shares entitled to vote on a proposal must be present in person
or by proxy to have a quorum to conduct business at the Special Meeting.
Abstentions and broker non-votes will be deemed present for quorum purposes.



  CERTAIN VOTING INFORMATION REGARDING TARGET FUND RP. RP held in "street name"
may be voted under certain conditions by broker-dealer firms and counted for
purposes of establishing a quorum of that Fund if no instructions are received
one business day before the Meeting or, if adjourned, one business day before
the day to which the Meetings are adjourned. These conditions include, among
others, that (i) at least 30% of the Target Fund's RP outstanding have voted on
the Reorganization and (ii) less than 10% of the Target Fund RP outstanding have
voted against the Reorganization. In such instance, the broker-dealer firm will
vote such uninstructed Target Fund RP on the Reorganization in the same
proportion as the votes cast by all holders of Target Fund RP who voted on the
Reorganization. The Target Fund will include shares held of record by
broker-dealers as to which such authority has been granted in its tabulation of
the total number of shares present for purposes of determining whether the
necessary quorum of shareholders of the Target Fund exists.


SHAREHOLDER INFORMATION


  As of April 25, 2005, to the knowledge of the Acquiring Fund, no shareholder
owned beneficially more than 5% of the outstanding common shares of the
Acquiring Fund.



  Except as set forth below, as of April 25, 2005, to the knowledge of the
Target Fund, no shareholder owned beneficially more than 5% of the outstanding
common shares of the Target Fund:



<Table>
<Caption>
                                                          APPROXIMATE PERCENTAGE
                                                               OWNERSHIP ON
SHAREHOLDER AND ADDRESS                                       APRIL 25, 2005
- -----------------------                                   ----------------------
<S>                                     <C>               <C>
Karpus Management, Inc. d/b/a/ Karpus                             9.86%
  Investment Management
  183 Sullys Trail
  Pittsford, New York 14534
</Table>


                                        64
<PAGE>


  The table below indicates the number of common shares of the Funds owned
beneficially by each trustee of the Funds, as of April 25, 2005, and the
percentage of such trustee's Common Shares to the total common shares
outstanding for such fund is shown in parenthesis when such ownership
individually exceeds 1% of the total common shares outstanding.



<Table>
<Caption>
                                               TARGET FUND    ACQUIRING FUND
                                               -----------    --------------
<S>                                            <C>            <C>
Independent Trustees
Arch.......................................        524              800
Dammeyer...................................          0            8,300
Heagy......................................        100              100
Kennedy....................................        100              100
Sonnenschein...............................        300              300
Interested Trustees
Whalen.....................................        339              371
</Table>



  To the knowledge of the Funds, no executive officers owned, directly or
beneficially, common shares of the Funds as of April 25, 2005 and no trustees or
executive officers owned Preferred Shares of the Funds as of that date. As of
April 25, 2005, the trustees and executive officers of the Funds individually
and as a group owned less than 1% of the outstanding shares of each Fund.



SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE



  Section 30(f) of the 1940 Act and Section 16(a) of the Securities Exchange Act
of 1934, as amended, require the Funds' trustees, officers, investment adviser,
affiliated persons of the investment adviser and persons who own more than 10%
of a registered class of the applicable Fund's equity securities to file forms
with the SEC and the NYSE, as applicable, reporting their affiliation with the
applicable Fund and reports of ownership and changes in ownership of Fund
shares. These persons and entities are required by SEC regulation to furnish the
applicable Fund with copies of all such forms they file. Based on a review of
these forms furnished to each Fund, each Fund believes that during its last
fiscal year, its trustees, officers, investment adviser and affiliated persons
of the investment adviser complied with the applicable filing requirements
except that, due to clerical errors, the Form 4 filings of Wayne W. Whalen, a
trustee of each Fund, regarding a sales transaction of common shares of the
Acquiring Fund and of the Target Fund, were not filed in a timely manner.


SOLICITATION OF PROXIES


  Solicitation of proxies is being made primarily by the mailing of this Notice
and Proxy Statement/Prospectus with its enclosures on or about May 10, 2005.
Target Fund shareholders whose shares are held by nominees such as brokers can
vote their proxies by contacting their respective nominee. In addition to the
solicitation


                                        65
<PAGE>


of proxies by mail, employees of the Adviser and its affiliates as well as
dealers or their representatives may, without additional compensation, solicit
proxies in person or by mail, telephone, telegraph, facsimile or oral
communication. The Target Fund has retained Computershare Fund Services ("CFS")
to make telephone calls to Target Fund shareholders to remind them to vote. CFS
will be paid a project management fee as well as fees charged on a per call
basis and certain other expenses. Management estimates that any such
solicitation would cost approximately $9,600. Proxy solicitation expenses are an
expense of the Reorganization which will be borne by the Target Fund and the
Acquiring Fund in proportion to their projected declines in total operating
expenses as a result of the Reorganization.



LEGAL MATTERS



  Certain legal matters concerning the federal income tax consequences of the
Reorganization and the issuance of Acquiring Fund Common Shares and Acquiring
Fund APS will be passed upon by Skadden Arps, which serves as counsel to the
Target Fund and the Acquiring Fund. Wayne W. Whalen, a partner of Skadden Arps,
is a trustee of both the Target Fund and the Acquiring Fund.


OTHER MATTERS TO COME BEFORE THE MEETING


  The Target Fund Board of Trustees knows of no business other than that
described in this Proxy Statement/Prospectus which will be presented for
consideration at the Special Meeting. If any other matters are properly
presented, it is the intention of the persons named on the enclosed proxy card
to vote proxies in accordance with their best judgment.



  In the event that a quorum is present at the Special Meeting but sufficient
votes to approve the proposed Reorganization are not received, proxies
(including abstentions and broker non-votes) will be voted in favor of one or
more adjournments of the Special Meeting to permit further solicitation of
proxies on the proposed Reorganization, provided that the Target Fund Board of
Trustees determines that such an adjournment and additional solicitation is
reasonable and in the interest of shareholders based on a consideration of all
relevant factors, including the percentage of votes then cast, the percentage of
negative votes cast, the nature of the proposed solicitation activities and the
nature of the reasons for such further solicitation. Any such adjournment will
require the affirmative vote of the holders of a majority of the outstanding
shares voted at the session of the Special Meeting to be adjourned.


                                        66
<PAGE>


  If you cannot be present in person at the Special Meeting, please fill in,
sign and return the enclosed proxy card promptly or please record your voting
instructions by telephone or via the internet. No postage is necessary if the
enclosed proxy card is mailed in the United States.


                                       LOU ANNE MCINNIS
                                       Assistant Secretary
                                       Van Kampen Investment Grade Municipal
                                       Trust


May 6, 2005


                                        67
<PAGE>

                                   EXHIBIT I

                       DESCRIPTION OF SECURITIES RATINGS

  STANDARD & POOR'S -- A brief description of the applicable Standard & Poor's
(S&P) rating symbols and their meanings (as published by S&P) follows:

  A S&P issue credit rating is a current opinion of the creditworthiness of an
obligor with respect to a specific financial obligation, a specific class of
financial obligations, or a specific financial program (including ratings on
medium-term note programs and commercial paper programs). It takes into
consideration the creditworthiness of guarantors, insurers, or other forms of
credit enhancement on the obligation and takes into account the currency in
which the obligation is denominated. The issue credit rating is not a
recommendation to purchase, sell, or hold a financial obligation, inasmuch as it
does not comment as to market price or suitability for a particular investor.
Issue credit ratings are based on current information furnished by the obligors
or obtained by S&P from other sources it considers reliable. S&P does not
perform an audit in connection with any credit rating and may, on occasion, rely
on unaudited financial information. Credit ratings may be changed, suspended, or
withdrawn as a result of changes in, or unavailability of, such information, or
based on other circumstances. Issue credit ratings can be either long-term or
short-term. Short-term ratings are generally assigned to those obligations
considered short term in the relevant market. In the U.S., for example, that
means obligations with an original maturity of no more than 365 days, including
commercial paper. Short-term ratings are also used to indicate the
creditworthiness of an obligor with respect to put features on long-term
obligations. The result is a dual rating, in which the short-term ratings
address the put feature, in addition to the usual long-term rating. Medium-term
notes are assigned long-term ratings.

                         LONG-TERM ISSUE CREDIT RATINGS

  Issue credit ratings are based, in varying degrees, on the following
considerations:

        - Likelihood of payment -- capacity and willingness of the obligor to
    meet its financial commitment on an obligation in accordance with the terms
    of the obligation;

        - Nature of and provisions of the obligation;

        - Protection afforded by, and relative position of, the obligation in
    the event of bankruptcy, reorganization, or other arrangement under the laws
    of bankruptcy and other laws affecting creditors' rights.

  The issue rating definitions are expressed in terms of default risk. As such,
they pertain to senior obligations of an entity. Junior obligations are
typically rated lower

                                       I-1
<PAGE>

than senior obligations, to reflect the lower priority in bankruptcy, as noted
above. (Such differentiation applies when an entity has both senior and
subordinated obligations, secured and unsecured obligations, or operating
company and holding company obligations.) Accordingly, in the case of junior
debt, the rating may not conform exactly with the category definition.

  AAA: An obligation rated "AAA" has the highest rating assigned by S&P. The
obligor's capacity to meet its financial commitment on the obligation is
extremely strong.

  AA: An obligation rated "AA" differs from the highest-rated obligations only
in small degree. The obligor's capacity to meet its financial commitment on the
obligation is very strong.

  A: An obligation rated "A" is somewhat more susceptible to the adverse effects
of changes in circumstances and economic conditions than obligations in higher
rated categories. However, the obligor's capacity to meet its financial
commitment on the obligation is still strong.

  BBB: An obligation rated "BBB" exhibits adequate protection parameters.
However, adverse economic conditions or changing circumstances are more likely
to lead to a weakened capacity of the obligor to meet its financial commitment
on the obligation.

                               SPECULATIVE GRADE

  BB, B, CCC, CC, C: Obligations rated "BB", "B", "CCC", "CC" and "C" are
regarded as having significant speculative characteristics. "BB" indicates the
least degree of speculation and "C" the highest. While such obligations will
likely have some quality and protective characteristics, these may be outweighed
by large uncertainties or major exposures to adverse conditions.

  BB: An obligation rated "BB" is less vulnerable to nonpayment than other
speculative issues. However, it faces major ongoing uncertainties or exposure to
adverse business, financial, or economic conditions which could lead to the
obligor's inadequate capacity to meet its financial commitment on the
obligation.

  B: An obligation rated "B" is more vulnerable to nonpayment than obligations
rated "BB", but the obligor currently has the capacity to meet its financial
commitment on the obligation. Adverse business, financial, or economic
conditions will likely impair the obligor's capacity or willingness to meet its
financial commitment on the obligation.

  CCC: An obligation rated "CCC" is currently vulnerable to nonpayment, and is
dependent upon favorable business, financial, and economic conditions for the
obligor to meet its financial commitment on the obligation. In the event of
adverse

                                       I-2
<PAGE>

business, financial, or economic conditions, the obligor is not likely to have
the capacity to meet its financial commitment on the obligation.

  CC: An obligation rated "CC" is currently highly vulnerable to nonpayment.

  C: A subordinated debt or preferred stock obligation rated "C" is CURRENTLY
HIGHLY VULNERABLE to nonpayment. The "C" rating may be used to cover a situation
where a bankruptcy petition has been filed or similar action taken, but payments
on this obligation are being continued. A "C" also will be assigned to a
preferred stock issue in arrears on dividends or sinking fund payments, but that
is currently paying.

  D: An obligation rated "D" is in payment default. The "D" rating category is
used when payments on an obligation are not made on the date due even if the
applicable grace period has not expired, unless S&P believes that such payments
will be made during such grace period. The "D" rating also will be used upon the
filing of a bankruptcy petition or the taking of a similar action if payments on
an obligation are jeopardized.

  Plus (+) or minus (-): The ratings from "AA" to "CCC" may be modified by the
addition of a plus or minus sign to show relative standing within the major
rating categories.

  r: This symbol is attached to the ratings of instruments with significant
noncredit risks. It highlights risks to principal or volatility of expected
returns which are not addressed in the credit rating.

  N.R.: This indicates that no rating has been requested, that there is
insufficient information on which to base a rating, or that S&P does not rate a
particular obligation as a matter of policy.

                        SHORT-TERM ISSUE CREDIT RATINGS

  A-1: A short-term obligation rated "A-1" is rated in the highest category by
S&P. The obligor's capacity to meet its financial commitment on the obligation
is strong. Within this category, certain obligations are designated with a plus
sign (+). This indicates that the obligor's capacity to meet its financial
commitment on these obligations is extremely strong.

  A-2: A short-term obligation rated "A-2" is somewhat more susceptible to the
adverse effects of changes in circumstances and economic conditions than
obligations in higher rating categories. However, the obligor's capacity to meet
its financial commitment on the obligation is satisfactory.

  A-3: A short-term obligation rated "A-3" exhibits adequate protection
parameters. However, adverse economic conditions or changing circumstances are
more

                                       I-3
<PAGE>

likely to lead to a weakened capacity of the obligor to meet its financial
commitment on the obligation.

  B: A short-term obligation rated "B" is regarded as having significant
speculative characteristics. The obligor currently has the capacity to meet its
financial commitment on the obligation; however, it faces major ongoing
uncertainties which could lead to the obligor's inadequate capacity to meet its
financial commitment on the obligation.

  C: A short-term obligation rated "C" is currently vulnerable to nonpayment and
is dependent upon favorable business, financial, and economic conditions for the
obligor to meet its financial commitment on the obligation.

  D: A short-term obligation rated "D" is in payment default. The "D" rating
category is used when payments on an obligation are not made on the date due
even if the applicable grace period has not expired, unless S&P believes that
such payments will be made during such grace period. The "D" rating also will be
used upon the filing of a bankruptcy petition or the taking of a similar action
if payments on an obligation are jeopardized.

  MOODY'S INVESTORS SERVICE INC. -- A brief description of the applicable
Moody's Investors Service, Inc. (Moody's) rating symbols and their meanings (as
published by Moody's) follows:

  Aaa: Obligations rated Aaa are judged to be of the highest quality with
minimal credit risk.

  Aa: Obligations rated Aa are judged to be of high quality and are subject to
very low credit risk.

  A: Obligations rated A are considered upper-medium grade and are subject to
low credit risk.

  Baa: Obligations rated Baa are subject to moderate credit risk. They are
considered medium-grade and as such may possess certain speculative
characteristics.

  Ba: Obligations rated Ba are judged to have speculative elements and are
subject to substantial credit risk.

  B: Obligations rated B are considered speculative and are subject to high
credit risk.

  Caa: Obligations rated Caa are judged to be of poor standing and are subject
to very high credit risk.

  Ca: Obligations rated Ca are highly speculative and are likely in, or very
near, default, with some prospect of recovery of principal and interest.

                                       I-4
<PAGE>

  C: Obligations rated C are the lowest rated class of bonds, and are typically
in default, with little prospect for recovery of principal or interest.

  Note: Moody's appends numerical modifiers 1, 2, and 3 to each generic rating
classification from Aa through Caa. The modifier 1 indicates that the obligation
ranks in the higher end of its generic rating category; the modifier 2 indicates
a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of
that generic rating category.

  Moody's assigns long-term ratings to individual debt securities issued from
medium-term note (MTN) programs, in addition to indicating ratings to MTN
programs themselves. Notes issued under MTN programs with such indicated ratings
are rated at issuance at the rating applicable to all pari passu notes issued
under the same program, at the program's relevant indicated rating, provided
such notes do not exhibit any of the characteristics listed below:

        -- Notes containing features that link interest or principal to the
    credit performance of any third party or parties.

        -- Notes allowing for negative coupons, or negative principal.

        -- Notes containing any provision that could obligate the investor to
    make any additional payments.

        -- Notes containing provisions that subordinate the claim.

  For notes with any of these characteristics, the rating of the individual note
may differ from the indicated rating of the program.

  Market participants must determine whether any particular note is rated, and
if so, at what rating level. Moody's encourages market participants to contact
Moody's Ratings Desks directly or visit www.moodys.com directly if they have
questions regarding ratings for specific notes issued under a medium-term note
program. Unrated notes issued under an MTN program may be assigned an NR symbol.

                                       I-5
<PAGE>

                               SHORT-TERM RATINGS

  Moody's short-term ratings are opinions of the ability of issuers to honor
short-term financial obligations. Ratings may be assigned to issuers, short-term
programs or to individual short-term debt instruments. Such obligations
generally have an original maturity not exceeding thirteen months, unless
explicitly noted. Moody's employs the following designations to indicate the
relative repayment ability of rated issuers:

                                      P-1

  Issuers (or supporting institutions) rated Prime-1 have a superior ability to
repay short-term debt obligations.

                                      P-2

  Issuers (or supporting institutions) rated Prime-2 have a strong ability to
repay short-term debt obligations.

                                      P-3

  Issuers (or supporting institutions) rated Prime-3 have an acceptable ability
to repay short-term obligations.

                                       NP

  Issuers (or supporting institutions) rated Not Prime do not fall within any of
the Prime rating categories.

  NOTE: Canadian issuers rated P-1 or P-2 have their short-term ratings enhanced
by the senior-most long-term rating of the issuer, its guarantor or
support-provider.

                                       I-6
<PAGE>

                         [VAN KAMPEN INVESTMENTS LOGO]
<PAGE>

THE INFORMATION IN THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT COMPLETE AND
MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS
STATEMENT OF ADDITIONAL INFORMATION IS NOT AN OFFER TO SELL THESE SECURITIES AND
IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER
OR SALE IS NOT PERMITTED.


                    SUBJECT TO COMPLETION, DATED MAY 5, 2005


                      STATEMENT OF ADDITIONAL INFORMATION

          RELATING TO THE ACQUISITION OF THE ASSETS AND LIABILITIES OF

                  VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

                        BY AND IN EXCHANGE FOR SHARES OF

                           VAN KAMPEN MUNICIPAL TRUST


                               DATED MAY 6, 2005



     This Statement of Additional Information is available to the shareholders
of Van Kampen Investment Grade Municipal Trust (the "Target Fund") in connection
with a proposed transaction (the "Reorganization") whereby Van Kampen Municipal
Trust (the "Acquiring Fund") will acquire substantially all of the assets and
assume substantially all of the liabilities of the Target Fund in exchange for
an equal aggregate value of newly-issued common shares of beneficial interest,
par value $0.01 per share ("Acquiring Fund Common Shares"), and newly-issued
Series E auction preferred shares with a par value of $0.01 per share and a
liquidation preference of $25,000 per share ("Acquiring Fund APS"). The Target
Fund will distribute Acquiring Fund Common Shares to holders of common shares of
the Target Fund ("Target Fund Common Shares") and Series E Acquiring Fund APS to
holders of Remarketed Preferred Shares of the Target Fund ("Target Fund RP"),
and will then terminate its registration under the Investment Company Act of
1940, as amended (the "1940 Act"), and dissolve under applicable state law. A
copy of a form of the Agreement and Plan of Reorganization between the Target
Fund and the Acquiring Fund is attached hereto as Appendix A. Unless otherwise
defined herein, capitalized terms have the meanings given to them in the Proxy
Statement/Prospectus.



     This Reorganization Statement of Additional Information is not a prospectus
and should be read in conjunction with the Proxy Statement/Prospectus dated May
6, 2005 relating to the proposed Reorganization of the Target Fund into the
Acquiring Fund. A copy of the Proxy Statement/Prospectus may be obtained,
without charge, by writing to the Van Kampen Client Relations Department at 1
Parkview Plaza, P.O. Box 5555, Oakbrook Terrace, Illinois 60181-5555 or by
calling (800) 341-2929 (TDD users may call (800) 421-2833).



     The Acquiring Fund will provide, without charge, upon the written or oral
request of any person to whom this Reorganization Statement of Additional
Information is delivered, a copy of any and all documents that have been
incorporated by reference in the registration statement of which this
Reorganization Statement of Additional Information is a part.



     This Reorganization Statement of Additional Information is intended to
provide Target Fund shareholders with certain additional information about the
Acquiring Fund, which will hereinafter sometimes be referred to simply as the
"Fund."


                               TABLE OF CONTENTS


<Table>
<Caption>
                                                              Page
                                                              ----
<S>                                                           <C>
Trustees and Officers.......................................  S-2
Investment Advisory Agreement...............................  S-13
Other Agreements............................................  S-14
Fund Management.............................................  S-15
Code of Ethics..............................................  S-17
Portfolio Transactions and Brokerage Allocation.............  S-17
Additional Information Relating to Auction Preferred Shares
  of the Acquiring Fund.....................................  S-19
Other Information...........................................  S-29
Financial Statements........................................  S-29
Pro Forma Financial Statements..............................  S-30
Appendix A Form of Agreement and Plan of Reorganization.....  A-1
Appendix B Certificate of Vote of Trustees..................  B-1
Appendix C Acquiring Fund Annual Report Dated October 31,
  2004......................................................  C-1
Appendix D Target Fund Annual Report Dated October 31,
  2004......................................................  D-1
Appendix E Proxy Voting Procedures..........................  E-1
</Table>

<PAGE>

                             TRUSTEES AND OFFICERS

GENERAL


     The business and affairs of the Fund are managed under the direction of the
Fund's Board of Trustees and the Fund's officers appointed by the Board of
Trustees. The Acquiring Fund and the Target Fund share the same Board of
Trustees and executive officers. The tables below list the trustees and
executive officers of the Fund and their principal occupations during the last
five years, other directorships held by trustees and their affiliations, if any,
with Van Kampen Investments Inc. ("Van Kampen Investments"), Van Kampen Asset
Management (the "Adviser"), Van Kampen Funds Inc. (the "Administrator"), Van
Kampen Advisors Inc., Van Kampen Exchange Corp. and Van Kampen Investor Services
Inc. ("Investor Services"). The term "Fund Complex" includes each of the
investment companies advised by the Adviser as of the date of this
Reorganization Statement of Additional Information. Trustees serve until
reaching their retirement age or until their successors are duly elected and
qualified. Officers are annually elected by the trustees.


                              INDEPENDENT TRUSTEES


<Table>
<Caption>
                                                                                          NUMBER OF
                                               TERM OF                                     FUNDS IN
                                              OFFICE AND                                     FUND
                                 POSITION(S)  LENGTH OF                                    COMPLEX
NAME, AGE AND ADDRESS             HELD WITH      TIME     PRINCIPAL OCCUPATION(S)          OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE              FUND        SERVED    DURING PAST 5 YEARS             BY TRUSTEE   HELD BY TRUSTEE
<S>                              <C>          <C>         <C>                             <C>          <C>
David C. Arch (59)               Trustee      Trustee     Chairman and Chief Executive        82       Trustee/Director/
Blistex Inc.                                  since 1991  Officer of Blistex Inc., a                   Managing General
1800 Swift Drive                                          consumer health care products                Partner of funds in
Oak Brook, IL 60523                                       manufacturer. Director of the                the Fund Complex.
                                                          Heartland Alliance, a
                                                          nonprofit organization serving
                                                          human needs based in Chicago.
                                                          Director of St. Vincent de
                                                          Paul Center, a Chicago based
                                                          day care facility serving the
                                                          children of low income
                                                          families. Board member of the
                                                          Illinois Manufacturers'
                                                          Association.

Jerry D. Choate (66)             Trustee      Trustee     Prior to January 1999,              80       Trustee/Director/
33971 Selva Road                              since 2003  Chairman and Chief Executive                 Managing General
Suite 130                                                 Officer of the Allstate                      Partner of funds in
Dana Point, CA 92629                                      Corporation ("Allstate") and                 the Fund Complex.
                                                          Allstate Insurance Company.                  Director of Amgen
                                                          Prior to January 1995,                       Inc., a
                                                          President and Chief Executive                biotechnological
                                                          Officer of Allstate. Prior to                company, and Director
                                                          August 1994, various                         of Valero Energy
                                                          management positions at                      Corporation, an
                                                          Allstate.                                    independent refining
                                                                                                       company.
</Table>


                                       S-2
<PAGE>


<Table>
<Caption>
                                                                                          NUMBER OF
                                               TERM OF                                     FUNDS IN
                                              OFFICE AND                                     FUND
                                 POSITION(S)  LENGTH OF                                    COMPLEX
NAME, AGE AND ADDRESS             HELD WITH      TIME     PRINCIPAL OCCUPATION(S)          OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE              FUND        SERVED    DURING PAST 5 YEARS             BY TRUSTEE   HELD BY TRUSTEE
<S>                              <C>          <C>         <C>                             <C>          <C>
Rod Dammeyer+ (64)               Trustee      Trustee     President of CAC, L.L.C., a         82       Trustee/Director/
CAC, L.L.C.                                   since 1991  private company offering                     Managing General
4350 LaJolla Village Drive                                capital investment and                       Partner of funds in
Suite 980                                                 management advisory services.                the Fund Complex.
San Diego, CA 92122-6223                                  Prior to February 2001, Vice                 Director of
                                                          Chairman and Director of                     Stericycle, Inc.,
                                                          Anixter International, Inc., a               Ventana Medical
                                                          global distributor of wire,                  Systems, Inc., and
                                                          cable and communications                     GATX Corporation, and
                                                          connectivity products. Prior                 Trustee of The
                                                          to July 2000, Managing Partner               Scripps Research
                                                          of Equity Group Corporate                    Institute. Prior to
                                                          Investment (EGI), a company                  January 2005, Trustee
                                                          that makes private investments               of the University of
                                                          in other companies.                          Chicago Hospitals and
                                                                                                       Health Systems. Prior
                                                                                                       to April 2004,
                                                                                                       Director of
                                                                                                       TheraSense, Inc.
                                                                                                       Prior to January
                                                                                                       2004, Director of
                                                                                                       TeleTech Holdings
                                                                                                       Inc. and Arris Group,
                                                                                                       Inc. Prior to May
                                                                                                       2002, Director of
                                                                                                       Peregrine Systems
                                                                                                       Inc. Prior to
                                                                                                       February 2001,
                                                                                                       Director of IMC
                                                                                                       Global Inc. Prior to
                                                                                                       July 2000, Director
                                                                                                       of Allied Riser
                                                                                                       Communications Corp.,
                                                                                                       Matria Healthcare
                                                                                                       Inc., Transmedia
                                                                                                       Networks, Inc., CNA
                                                                                                       Surety, Corp. and
                                                                                                       Grupo Azcarero Mexico
                                                                                                       (GAM).

Linda Hutton Heagy (56)          Trustee      Trustee     Managing Partner of Heidrick &      80       Trustee/Director/
Heidrick & Struggles                          since 2003  Struggles, an executive search               Managing General
233 South Wacker Drive                                    firm. Trustee on the                         Partner of funds in
Suite 7000                                                University of Chicago                        the Fund Complex.
Chicago, IL 60606                                         Hospitals Board, Vice Chair of
                                                          the Board of the YMCA of
                                                          Metropolitan Chicago and a
                                                          member of the Women's Board of
                                                          the University of Chicago.
                                                          Prior to 1997, Partner of Ray
                                                          & Berndtson, Inc., an
                                                          executive recruiting firm.
                                                          Prior to 1996, Trustee of The
                                                          International House Board, a
                                                          fellowship and housing
                                                          organization for international
                                                          graduate students. Prior to
                                                          1995, Executive Vice President
                                                          of ABN AMRO, N.A., a bank
                                                          holding company. Prior to
                                                          1992, Executive Vice President
                                                          of La Salle National Bank.
</Table>


                                       S-3
<PAGE>


<Table>
<Caption>
                                                                                          NUMBER OF
                                               TERM OF                                     FUNDS IN
                                              OFFICE AND                                     FUND
                                 POSITION(S)  LENGTH OF                                    COMPLEX
NAME, AGE AND ADDRESS             HELD WITH      TIME     PRINCIPAL OCCUPATION(S)          OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE              FUND        SERVED    DURING PAST 5 YEARS             BY TRUSTEE   HELD BY TRUSTEE
<S>                              <C>          <C>         <C>                             <C>          <C>

R. Craig Kennedy (53)            Trustee      Trustee     Director and President of the       80       Trustee/Director/
1744 R Street, NW                             since 2003  German Marshall Fund of the                  Managing General
Washington, DC 20009                                      United States, an independent                Partner of funds in
                                                          U.S. foundation created to                   the Fund Complex.
                                                          deepen understanding, promote
                                                          collaboration and stimulate
                                                          exchanges of practical
                                                          experience between Americans
                                                          and Europeans. Formerly,
                                                          advisor to the Dennis Trading
                                                          Group Inc., a managed futures
                                                          and option company that
                                                          invests money for individuals
                                                          and institutions. Prior to
                                                          1992, President and Chief
                                                          Executive Officer, Director
                                                          and member of the Investment
                                                          Committee of the Joyce
                                                          Foundation, a private
                                                          foundation.

Howard J Kerr (69)               Trustee      Trustee     Prior to 1998, President and        82       Trustee/Director/
736 North Western Avenue                      since 1992  Chief Executive Officer of                   Managing General
P.O. Box 317                                              Pocklington Corporation, Inc.,               Partner of funds in
Lake Forest, IL 60045                                     an investment holding company.               the Fund Complex.
                                                          Director of the Marrow                       Director of the Lake
                                                          Foundation.                                  Forest Bank & Trust.

Jack E. Nelson (69)              Trustee      Trustee     President of Nelson Investment      80       Trustee/Director/
423 Country Club Drive                        since 2003  Planning Services, Inc., a                   Managing General
Winter Park, FL 32789                                     financial planning company and               Partner of funds in
                                                          registered investment adviser                the Fund Complex.
                                                          in the State of Florida.
                                                          President of Nelson Ivest
                                                          Brokerage Services Inc., a
                                                          member of the NASD, Securities
                                                          Investors Protection Corp. and
                                                          the Municipal Securities
                                                          Rulemaking Board. President of
                                                          Nelson Sales and Services
                                                          Corporation, a marketing and
                                                          services company to support
                                                          affiliated companies.

Hugo F. Sonnenschein+ (64)       Trustee      Trustee     President Emeritus and              82       Trustee/Director/
1126 E. 59th Street                           since 1994  Honorary Trustee of the                      Managing General
Chicago, IL 60637                                         University of Chicago and the                Partner of funds in
                                                          Adam Smith Distinguished                     the Fund Complex.
                                                          Service Professor in the                     Director of Winston
                                                          Department of Economics at the               Laboratories, Inc.
                                                          University of Chicago. Prior
                                                          to July 2000, President of the
                                                          University of Chicago. Trustee
                                                          of the University of Rochester
                                                          and a member of its investment
                                                          committee. Member of the
                                                          National Academy of Sciences,
                                                          the American Philosophical
                                                          Society and a fellow of the
                                                          American Academy of Arts and
                                                          Sciences.
</Table>


                                       S-4
<PAGE>


<Table>
<Caption>
                                                                                          NUMBER OF
                                               TERM OF                                     FUNDS IN
                                              OFFICE AND                                     FUND
                                 POSITION(S)  LENGTH OF                                    COMPLEX
NAME, AGE AND ADDRESS             HELD WITH      TIME     PRINCIPAL OCCUPATION(S)          OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE              FUND        SERVED    DURING PAST 5 YEARS             BY TRUSTEE   HELD BY TRUSTEE
<S>                              <C>          <C>         <C>                             <C>          <C>

Suzanne H. Woolsey, Ph.D. (63)   Trustee      Trustee     Chief Communications Officer        80       Trustee/Director/
815 Cumberstone Road                          since 2003  of the National Academy of                   Managing General
Harwood, MD 20776                                         Sciences/National Research                   Partner of funds in
                                                          Council, an independent,                     the Fund Complex.
                                                          federally chartered policy                   Director of Fluor
                                                          institution, from 2001 to                    Corp., an
                                                          November 2003 and Chief                      engineering,
                                                          Operating Officer from 1993 to               procurement and
                                                          2001. Director of the                        construction
                                                          Institute for Defense                        organization, since
                                                          Analyses, a federally funded                 January 2004 and
                                                          research and development                     Director of Neurogen
                                                          center, Director of the German               Corporation, a
                                                          Marshall Fund of the United                  pharmaceutical
                                                          States, Director of the Rocky                company, since
                                                          Mountain Institute and Trustee               January 1998.
                                                          of Colorado College. Prior to
                                                          1993, Executive Director of
                                                          the Commission on Behavioral
                                                          and Social Sciences and
                                                          Education at the National
                                                          Academy of Sciences/National
                                                          Research Council. From 1980
                                                          through 1989, Partner of
                                                          Coopers & Lybrand.
</Table>


                                       S-5
<PAGE>

                              INTERESTED TRUSTEES*


<Table>
<Caption>
                                                                                          NUMBER OF
                                            TERM OF                                        FUNDS IN
                                           OFFICE AND                                        FUND
                              POSITION(S)  LENGTH OF                                       COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)             OVERSEEN    OTHER DIRECTORSHIPS
OF INTERESTED TRUSTEE            FUND        SERVED    DURING PAST 5 YEARS                BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                                <C>          <C>
Mitchell M. Merin* (51)       Trustee,     Trustee     President and Chief Executive          80       Trustee/Director/
1221 Avenue of the Americas   President    since       Officer of funds in the Fund                    Managing General
New York, NY 10020            and Chief    2003;       Complex. Chairman, President,                   Partner of funds in
                              Executive    President   Chief Executive Officer and                     the Fund Complex.
                              Officer      and Chief   Director of the Adviser and Van
                                           Executive   Kampen Advisors Inc. since
                                           Officer     December 2002. Chairman,
                                           since 2002  President and Chief Executive
                                                       Officer of Van Kampen Investments
                                                       since December 2002. Director of
                                                       Van Kampen Investments since
                                                       December 1999. Chairman and
                                                       Director of Van Kampen Funds Inc.
                                                       since December 2002. President,
                                                       Director and Chief Operating
                                                       Officer of Morgan Stanley
                                                       Investment Management since
                                                       December 1998. President and
                                                       Director since April 1997 and
                                                       Chief Executive Officer since
                                                       June 1998 of Morgan Stanley
                                                       Investment Advisors Inc. and
                                                       Morgan Stanley Services Company
                                                       Inc. Chairman, Chief Executive
                                                       Officer and Director of Morgan
                                                       Stanley Distributors Inc. since
                                                       June 1998. Chairman since June
                                                       1998, and Director since January
                                                       1998 of Morgan Stanley Trust.
                                                       Director of various Morgan
                                                       Stanley subsidiaries. President
                                                       of the Morgan Stanley Funds since
                                                       May 1999. Previously Chief
                                                       Executive Officer of Van Kampen
                                                       Funds Inc. from December 2002 to
                                                       July 2003, Chief Strategic
                                                       Officer of Morgan Stanley
                                                       Investment Advisors Inc. and
                                                       Morgan Stanley Services Company
                                                       Inc. and Executive Vice President
                                                       of Morgan Stanley Distributors
                                                       Inc. from April 1997 to June
                                                       1998. Chief Executive Officer
                                                       from September 2002 to April 2003
                                                       and Vice President from May 1997
                                                       to April 1999 of the Morgan
                                                       Stanley Funds.

Richard F. Powers, III* (59)  Trustee      Trustee     Advisory Director of Morgan            82       Trustee/Director/
1221 Avenue of the Americas                since 1999  Stanley. Prior to December 2002,                Managing General
New York, NY 10020                                     Chairman, Director, President,                  Partner of funds in
                                                       Chief Executive Officer and                     the Fund Complex.
                                                       Managing Director of Van Kampen
                                                       Investments and its investment
                                                       advisory, distribution and other
                                                       subsidiaries. Prior to December
                                                       2002, President and Chief
                                                       Executive Officer of funds in the
                                                       Fund Complex. Prior to May 1998,
                                                       Executive Vice President and
                                                       Director of Marketing at Morgan
                                                       Stanley and Director of Dean
                                                       Witter, Discover & Co. and Dean
                                                       Witter Realty. Prior to 1996,
                                                       Director of Dean Witter Reynolds
                                                       Inc.
</Table>


                                       S-6
<PAGE>


<Table>
<Caption>
                                                                                          NUMBER OF
                                            TERM OF                                        FUNDS IN
                                           OFFICE AND                                        FUND
                              POSITION(S)  LENGTH OF                                       COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)             OVERSEEN    OTHER DIRECTORSHIPS
OF INTERESTED TRUSTEE            FUND        SERVED    DURING PAST 5 YEARS                BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                                <C>          <C>
Wayne W. Whalen* (65)         Trustee      Trustee     Partner in the law firm of             82       Trustee/Director/
333 West Wacker Drive                      since 1991  Skadden, Arps, Slate, Meagher &                 Managing General
Chicago, IL 60606                                      Flom LLP, legal counsel to funds                Partner of funds in
                                                       in the Fund Complex.                            the Fund Complex.
                                                                                                       Director of the
                                                                                                       Abraham Lincoln
                                                                                                       Presidential Library
                                                                                                       Foundation.
</Table>


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

* Such trustee is an "interested person" (within the meaning of Section 2(a)(19)
  of the 1940 Act). Messrs. Merin and Powers are interested persons of funds in
  the Fund Complex and the Adviser by reason of their current or former
  positions with Morgan Stanley or its affiliates. Mr. Whalen is an interested
  person of certain funds in the Fund Complex by reason of he and his firm
  currently providing legal services as legal counsel to such funds in the Fund
  Complex.

+ Designated as Preferred Shares Trustee.

                                       S-7
<PAGE>

                                    OFFICERS


<Table>
<Caption>
                                                     TERM OF
                                                    OFFICE AND
                                   POSITION(S)      LENGTH OF
NAME, AGE AND                       HELD WITH          TIME     PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER                     FUND           SERVED    DURING PAST 5 YEARS
<S>                             <C>                 <C>         <C>

Stefanie V. Chang Yu (38)       Vice President      Officer     Executive Director of Morgan Stanley Investment Management.
1221 Avenue of the Americas     and Secretary       since 2003  Vice President and Secretary of funds in the Fund Complex.
New York, NY 10020

Amy R. Doberman (43)            Vice President      Officer     Managing Director and General Counsel, U.S. Investment
1221 Avenue of the Americas                         since 2004  Management; Managing Director of Morgan Stanley Investment
New York, NY 10020                                              Management, Inc., Morgan Stanley Investment Advisers Inc.
                                                                and the Adviser. Vice President of the Morgan Stanley
                                                                Institutional and Retail Funds since July 2004 and Vice
                                                                President of funds in the Fund Complex as of August 2004.
                                                                Previously, Managing Director and General Counsel of
                                                                Americas, UBS Global Asset Management from July 2000 to July
                                                                2004 and General Counsel of Aeltus Investment Management,
                                                                Inc from January 1997 to July 2000.

James W. Garrett (36)           Chief Financial     Officer     Executive Director of Morgan Stanley Investment Management.
1221 Avenue of the Americas     Officer and         since 2005  Chief Financial Officer and Treasurer of Morgan Stanley
New York, NY 10020              Treasurer                       Institutional Funds since 2002 and of funds in the Fund
                                                                Complex since 2005.

Joseph J. McAlinden (62)        Executive Vice      Officer     Managing Director and Chief Investment Officer of Morgan
1221 Avenue of the Americas     President and       since 2002  Stanley Investment Advisors Inc., Morgan Stanley Investment
New York, NY 10020              Chief Investment                Management Inc. and Morgan Stanley Investments LP and
                                Officer                         Director of Morgan Stanley Trust for over 5 years. Executive
                                                                Vice President and Chief Investment Officer of funds in the
                                                                Fund Complex. Managing Director and Chief Investment Officer
                                                                of Van Kampen Investments, the Adviser and Van Kampen
                                                                Advisors Inc. since December 2002.

Ronald E. Robison (66)          Executive Vice      Officer     Executive Vice President and Principal Executive Officer of
1221 Avenue of the Americas     President and       since 2003  Funds in the Fund Complex since May 2003. Chief Executive
New York, NY 10020              Principal                       Officer and Chairman of Investor Services. Managing Director
                                Executive                       of Morgan Stanley. Chief Administrative Officer, Managing
                                Officer                         Director and Director of Morgan Stanley Investment Advisors
                                                                Inc., Morgan Stanley Services Company Inc. and Managing
                                                                Director and Director of Morgan Stanley Distributors Inc.
                                                                Chief Executive Officer and Director of Morgan Stanley
                                                                Trust. Executive Vice President and Principal Executive
                                                                Officer of the Institutional and Retail Morgan Stanley
                                                                Funds; Director of Morgan Stanley SICAV; previously Chief
                                                                Global Operations Officer and Managing Director of Morgan
                                                                Stanley Investment Management Inc.

John L. Sullivan (49)           Chief Compliance    Officer     Chief Compliance Officer of funds in the Fund Complex since
1 Parkview Plaza                Officer             since 1996  August 2004. Prior to August 2004, Director and Managing
Oakbrook Terrace, IL 60181                                      Director of Van Kampen Investments, the Adviser, Van Kampen
                                                                Advisors Inc. and certain other subsidiaries of Van Kampen
                                                                Investments, Vice President, Chief Financial Officer and
                                                                Treasurer of funds in the Fund Complex and head of Fund
                                                                Accounting for Morgan Stanley Investment Management. Prior
                                                                to December 2002, Executive Director of Van Kampen
                                                                Investments, the Adviser and Van Kampen Advisors Inc.
</Table>


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

COMPENSATION


     Each trustee/director/managing general partner (hereinafter referred to in
this section as "trustee") who is not an affiliated person (as defined in the
1940 Act) of Van Kampen Investments, the Adviser or the Administrator (each a
"Non-Affiliated Trustee") is compensated by an annual retainer and meeting fees
for services to funds in the Fund Complex. Each fund in the Fund Complex (except
Van Kampen Exchange Fund) provides a deferred compensation plan to its
Non-Affiliated Trustees that allows trustees to defer receipt of their
compensation until retirement and earn a return on such deferred amounts.
Amounts deferred are retained by the Fund and earn a rate of return determined


                                       S-8
<PAGE>

by reference to the return on the common shares of the Fund or other funds in
the Fund Complex as selected by the respective Non-Affiliated Trustee. To the
extent permitted by the 1940 Act, the Fund may invest in securities of those
funds selected by the Non-Affiliated Trustees in order to match the deferred
compensation obligation. The deferred compensation plan is not funded and
obligations thereunder represent general unsecured claims against the general
assets of the Fund. Deferring compensation has the same economic effect as if
the Non-Affiliated Trustee reinvested his or her compensation into the funds.
Each fund in the Fund Complex (except Van Kampen Exchange Fund) provides a
retirement plan to its Non-Affiliated Trustees that provides Non-Affiliated
Trustees with compensation after retirement, provided that certain eligibility
requirements are met. Under the retirement plan, a Non-Affiliated Trustee who is
receiving compensation from the Fund prior to such Non-Affiliated Trustee's
retirement, has at least 10 years of service (including years of service prior
to adoption of the retirement plan) and retires at or after attaining the age of
60, is eligible to receive a retirement benefit per year for each of the 10
years following such retirement from the Fund. Non-Affiliated Trustees retiring
prior to the age of 60 or with fewer than 10 years but more than 5 years of
service may receive reduced retirement benefits from the Fund.

     Additional information regarding compensation and benefits for trustees is
set forth below for the periods described in the notes accompanying the table.

                               COMPENSATION TABLE


<Table>
<Caption>
                                                                  Fund Complex
                                         --------------------------------------------------------------
                                         Aggregate Pension   Aggregate Estimated
                                           or Retirement       Maximum Annual
                         Aggregate       Benefits Accrued     Benefits from the     Total Compensation
                        Compensation        as Part of          Fund Complex       before Deferral from
       Name(1)        from the Fund(2)      Expenses(3)      Upon Retirement(4)      Fund Complex(5)
       -------        ----------------   -----------------   -------------------   --------------------
<S>                   <C>                <C>                 <C>                   <C>
INDEPENDENT TRUSTEES
David C. Arch              $6,729            $ 35,277             $147,500               $192,530
Jerry D. Choate             9,470              82,527              126,000                200,002
Rod Dammeyer                6,735              63,782              147,500                208,000
Linda Hutton Heagy          9,269              24,465              142,500                184,784
R. Craig Kennedy            9,470              16,911              142,500                200,002
Howard J Kerr               6,935             140,743              146,250                208,000
Jack E. Nelson              9,470              97,294              109,500                200,002
Hugo F. Sonnenschein        6,935              64,476              147,500                208,000
Suzanne H. Woolsey          9,470              58,450              142,500                200,002

INTERESTED TRUSTEE
Wayne W. Whalen(1)          6,935              72,001              147,500                208,000
</Table>


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


(1) Trustees not eligible for compensation are not included in the Compensation
    Table. Mr. Whalen is an "interested person" (within the meaning of Section
    2(a)(19) of the 1940 Act) of the Fund and certain other funds in the Fund
    Complex. J. Miles Branagan retired as a member of the Board of Trustees of
    the Fund and other funds in the Fund Complex on December 31, 2004. Theodore
    A. Myers retired from the Board of Trustees of the Fund and other funds in
    the Fund Complex as of December 31, 2003.


                                       S-9
<PAGE>


(2) The amounts shown in this column represent the aggregate compensation before
    deferral with respect to the Fund's fiscal year ended October 31, 2004. The
    following Trustees deferred compensation from the Fund during the fiscal
    year ended October 31, 2004: Mr. Choate, $9,470; Mr. Dammeyer, $6,735; Ms.
    Heagy, $9,269; Mr. Nelson, $9,470; Mr. Sonnenschein, $6,935; and Mr. Whalen,
    $6,935. The cumulative deferred compensation (including interest) accrued
    with respect to each trustee, including former trustees, from the Fund as of
    October 31, 2004 is as follows: Mr. Choate, $12,378; Mr. Dammeyer, $81,838;
    Ms. Heagy, $12,335; Mr. Kerr, $31,468; Mr. Nelson, $12,268; Mr.
    Sonnenschein, $71,005; and Mr. Whalen, $73,419. The deferred compensation
    plan is described above the Compensation Table.


(3) The amounts shown in this column represent the sum of the retirement
    benefits accrued by the operating funds in the Fund Complex for each of the
    trustees for the funds' respective fiscal years ended in 2004. The
    retirement plan is described above the Compensation Table.

(4) For each trustee, this is the sum of the estimated maximum annual benefits
    payable by the funds in the Fund Complex for each year of the 10-year period
    commencing in the year of such person's anticipated retirement. The
    retirement plan is described above the Compensation Table.

(5) The amounts shown in this column represent the aggregate compensation paid
    by all of the funds in the Fund Complex as of December 31, 2004 before
    deferral by the trustees under the deferred compensation plan. Because the
    funds in the Fund Complex have different fiscal year ends, the amounts shown
    in this column are presented on a calendar year basis.

BOARD COMMITTEES

     The Board of Trustees has three standing committees (an audit committee, a
brokerage and services committee and a governance committee). Each committee is
comprised solely of "Independent Trustees", which is defined for purposes herein
as trustees who: (1) are not "interested persons" of the Fund as defined by the
1940 Act and (2) are "independent" of the Fund as defined by the New York Stock
Exchange, American Stock Exchange and Chicago Stock Exchange listing standards.

     The Board's audit committee consists of Jerry D. Choate, Rod Dammeyer and
R. Craig Kennedy. In addition to being Independent Trustees as defined above,
each of these trustees also meets the additional independence requirements for
audit committee members as defined by the New York Stock Exchange, American
Stock Exchange and Chicago Stock Exchange listing standards. The audit committee
makes recommendations to the Board of Trustees concerning the selection of the
Fund's independent registered public accounting firm, reviews with such
independent registered public accounting firm the scope and results of the
Fund's annual audit and considers any comments which the independent registered
public accounting firm may have regarding the Fund's financial statements, books
of account or internal controls. The Board of Trustees has adopted a formal
written charter for the audit committee which sets forth the audit committee's
responsibilities. The audit committee has reviewed and discussed the financial
statements of the Fund with management as well as with the independent
registered public accounting firm of the Fund, and discussed with the
independent registered public accounting firm the matters required to be
discussed under the Statement of Auditing Standards No. 61. The audit committee
has received the written disclosures and the

                                       S-10
<PAGE>

letter from the independent registered public accounting firm required under
Independence Standards Board Standard No. 1 and has discussed with the
independent registered public accounting firm its independence. Based on this
review, the audit committee recommended to the Board of Trustees of the Fund
that the Fund's audited financial statements be included in the Fund's annual
report to shareholders for the most recent fiscal year for filing with the SEC.

     The Board's brokerage and services committee consists of Linda Hutton
Heagy, Hugo F. Sonnenschein and Suzanne H. Woolsey. The brokerage and services
committee reviews the Fund's allocation of brokerage transactions and
soft-dollar practices and reviews the transfer agency and shareholder servicing
arrangements with Investor Services.


     The Board's governance committee consists of David C. Arch, Howard J Kerr
and Jack E. Nelson. In addition to being Independent Trustees as defined above,
each of these trustees also meets the additional independence requirements for
nominating committee members as defined by the New York Stock Exchange, American
Stock Exchange and Chicago Stock Exchange listing standards. The governance
committee identifies individuals qualified to serve as Independent Trustees on
the Board and on committees of the Board, advises the Board with respect to
Board composition, procedures and committees, develops and recommends to the
Board a set of corporate governance principles applicable to the Fund, monitors
corporate governance matters and makes recommendations to the Board, and acts as
the administrative committee with respect to Board policies and procedures,
committee policies and procedures and codes of ethics. The Independent Trustees
of the Fund select and nominate any other nominee Independent Trustees for the
Fund. While the Independent Trustees of the Fund expect to be able to continue
to identify from their own resources an ample number of qualified candidates for
the Board of Trustees as they deem appropriate, they will consider nominations
from shareholders to the Board. Nominations from shareholders should be in
writing and sent to the Independent Trustees of the Fund at the Fund's offices
1221 Avenue of the Americas, New York, New York 10020 or directly to the
Independent Trustees at the address specified above for each trustee.



     During the Fund's last fiscal year, the Board of Trustees held 16 meetings.
During the Fund's last fiscal year, the audit committee of the Board held 5
meetings, the brokerage and services committee of the Board held 4 meetings and
the governance committee of the Board held 5 meetings.


SHARE OWNERSHIP


     Excluding any to deferred compensation balances as described in the
Compensation Table, as of December 31, 2004, the most recently completed
calendar year prior to the date of this Reorganization Statement of Additional
Information, each trustee of the Fund beneficially owned equity securities of
the Fund and of all of the funds in the Fund Complex overseen by the trustee in
the dollar range amounts specified below.


                                       S-11
<PAGE>

                2004 TRUSTEE BENEFICIAL OWNERSHIP OF SECURITIES

INDEPENDENT TRUSTEES


<Table>
<Caption>
                                                                              TRUSTEE
                                     -----------------------------------------------------------------------------------------
                                       ARCH    CHOATE   DAMMEYER   HEAGY    KENNEDY    KERR    NELSON   SONNENSCHEIN  WOOLSEY
                                     --------  -------  --------  --------  --------  -------  -------  ------------  --------
<S>                                  <C>       <C>      <C>       <C>       <C>       <C>      <C>      <C>           <C>
Dollar range of equity securities
 in the Fund.......................  $10,001-   none      over      $1-       $1-      none     none        $1-         none
                                     $50,000            $100,000  $10,000   $10,000                       $10,000
Aggregate dollar range of equity
 securities in all registered
 investment companies overseen by
 trustee in the Fund Complex.......  $50,001-    $1-      over    $10,001-    over      $1-      $1-      $10,001-    $10,001-
                                     $100,000  $10,000  $100,000  $50,000   $100,000  $10,000  $10,000    $50,000     $50,000
</Table>


INTERESTED TRUSTEES


<Table>
<Caption>
                                                                        TRUSTEE
                                                              ----------------------------
                                                               MERIN     POWERS    WHALEN
                                                              --------  --------  --------
<S>                                                           <C>       <C>       <C>
Dollar range of equity securities in the Fund...............    none      none      none
Aggregate dollar range of equity securities in all
 registered investment companies overseen by trustee in the
 Fund Complex...............................................    over      over      over
                                                              $100,000  $100,000  $100,000
</Table>



     Including deferred compensation balances (which are amounts deferred and
thus retained by the Fund as described in the Compensation Table), as of
December 31, 2004, the most recently completed calendar year prior to the date
of this Reorganization Statement of Additional Information, each trustee of the
Fund had in the aggregate, combining beneficially owned equity securities and
deferred compensation of the Fund and of all of the funds in the Fund Complex
overseen by the trustee, the dollar range of amounts specified below.


          2004 TRUSTEE BENEFICIAL OWNERSHIP AND DEFERRED COMPENSATION

INDEPENDENT TRUSTEES


<Table>
<Caption>
                                                                            TRUSTEE
                                  --------------------------------------------------------------------------------------------
                                    ARCH     CHOATE   DAMMEYER   HEAGY    KENNEDY     KERR     NELSON   SONNENSCHEIN  WOOLSEY
                                  --------  --------  --------  --------  --------  --------  --------  ------------  --------
<S>                               <C>       <C>       <C>       <C>       <C>       <C>       <C>       <C>           <C>
Dollar range of equity
 securities and deferred
 compensation in the Fund.......  $10,001-    none      over      $1-       $1-       none      none        $1-         none
                                  $50,000             $100,000  $10,000   $10,000                         $10,000
Aggregate dollar range of equity
 securities and deferred
 compensation in all registered
 investment companies overseen
 by trustee in Fund Complex.....  $50,001-    over      over      over      over      over      over        over      $10,000-
                                  $100,000  $100,000  $100,000  $100,000  $100,000  $100,000  $100,000    $100,000    $50,001
</Table>


INTERESTED TRUSTEES


<Table>
<Caption>
                                             TRUSTEE
                                  ------------------------------
                                   MERIN      POWERS     WHALEN
                                  --------   --------   --------
<S>                               <C>        <C>        <C>
Dollar range of equity
 securities and deferred
 compensation in the Fund.......    none       none       none
Aggregate dollar range of equity
 securities and deferred
 compensation in all registered
 investment companies overseen
 by trustee in the Fund
 Complex........................    over       over       over
                                  $100,000   $100,000   $100,000
</Table>


                                       S-12
<PAGE>


                         INVESTMENT ADVISORY AGREEMENT



     The Fund and the Adviser are parties to an investment advisory agreement
(the "Advisory Agreement"). Under the Advisory Agreement, the Fund retains the
Adviser to manage the investment of the Fund's assets, including the placing of
orders for the purchase and sale of portfolio securities. The Adviser obtains
and evaluates economic, statistical and financial information to formulate
strategy and implement the Fund's investment objective. The Adviser also
furnishes offices, necessary facilities and equipment, provides administrative
services to the Fund, renders periodic reports to the Fund's Board of Trustees
and permits its officers and employees to serve without compensation as trustees
or officers of the Fund if elected to such positions. The Fund, however, bears
the costs of its day-to-day operations, including custodian fees, auction agent
fees, fees for broker-dealers participating in auctions of the Fund's APS, legal
and independent registered public accounting firm fees, the costs of reports and
proxies to shareholders, compensation of trustees of the Fund (other than those
who are affiliated persons of the Adviser, Administrator or Van Kampen
Investments) and all other ordinary business expenses not specifically assumed
by the Adviser. The Advisory Agreement also provides that the Adviser shall not
be liable to the Fund for any actions or omissions in the absence of willful
misfeasance, bad faith, negligence or reckless disregard of its obligations and
duties under the Advisory Agreement.



     The Advisory Agreement may be continued from year to year if specifically
approved at least annually (a)(i) by the Fund's Board of Trustees or (ii) by a
vote of a majority of the Fund's outstanding voting securities and (b) by a vote
of a majority of the trustees who are not parties to the agreement or interested
persons of any such party by votes cast in person at a meeting called for such
purpose. The Advisory Agreement provides that it shall terminate automatically
if assigned and that it may be terminated without penalty by either party on 60
days' written notice.



     In approving the Advisory Agreement, the Board of Trustees, including the
non-interested trustees, considered the nature, quality and scope of the
services provided by the Adviser, the performance, fees and expenses of the Fund
compared to other similar investment companies, the Adviser's expenses in
providing the services and the profitability of the Adviser and its affiliated
companies. The Board of Trustees also reviewed the benefit to the Adviser of
receiving research paid for by Fund assets and the propriety of such an
arrangement and evaluated other benefits the Adviser derives from its
relationship with the Fund. The Board of Trustees considered the extent to which
any economies of scale experienced by the Adviser are shared with the Fund's
shareholders, and the propriety of alternative breakpoints in the Fund's
advisory fee schedule. The Board of Trustees considered comparative advisory
fees of the Fund and other investment companies at different asset levels. The
Board of Trustees reviewed reports from third parties about the foregoing
factors and considered changes, if any, in such items since its previous
approval. The Board of Trustees discussed the financial strength of the Adviser
and its affiliated companies and the capability of the personnel of the Adviser.
The Board of Trustees reviewed the statutory and regulatory requirements for
approval of advisory agreements. The Board of Trustees, including the
non-interested trustees, evaluated all of the foregoing and determined, in the
exercise of its business judgment, that approval of the Advisory Agreement was
in the best interests of the Fund and its shareholders.


                                       S-13
<PAGE>


ADVISORY FEES



<Table>
<Caption>
                                                       FISCAL YEAR ENDED OCTOBER 31,
                                                    ------------------------------------
                                                       2004         2003         2002
                                                    ----------   ----------   ----------
<S>                                                 <C>          <C>          <C>
The Adviser received the approximate advisory fees
  of..............................................  $5,364,400   $5,355,900   $5,256,800
</Table>



                                OTHER AGREEMENTS



THE ADMINISTRATION AGREEMENT



     The administrative services provided by the Administrator include record
keeping and reporting responsibilities with respect to the Fund's portfolio and
Preferred Shares and providing certain services to shareholders. Prior to June
1, 2004, the Fund paid the Administrator a monthly administrative fee at the
annual rate of 0.05% of the average net assets of the Fund. Effective June 1,
2004, the administrative fee was reduced from 0.05% to 0.00%.



ADMINISTRATIVE FEES



<Table>
<Caption>
                                                       FISCAL YEAR ENDED OCTOBER 31,
                                                      --------------------------------
                                                        2004       2003        2002
                                                      --------   --------   ----------
<S>                                                   <C>        <C>        <C>
Van Kampen Funds Inc. received the approximate
  administrative fees of............................  $261,200   $466,300   $1,133,600
</Table>



ACCOUNTING SERVICES AGREEMENT



     The Fund has entered into an accounting services agreement pursuant to
which the Adviser provides accounting services to the Fund supplementary to
those provided by the custodian. Such services are expected to enable the Fund
to more closely monitor and maintain its accounts and records. The Fund pays all
costs and expenses related to such services, including all salary and related
benefits of accounting personnel, as well as the overhead and expenses of office
space and the equipment necessary to render such services. The Fund shares
together with the other Van Kampen funds in the cost of providing such services
with 25% of such costs shared proportionately based on the respective number of
classes of securities issued per fund and the remaining 75% of such costs based
proportionately on the respective net assets per fund.



ACCOUNTING SERVICES FEES



<Table>
<Caption>
                                                           FISCAL YEAR ENDED OCTOBER 31,
                                                           ------------------------------
                                                             2004       2003       2002
                                                           --------   --------   --------
<S>                                                        <C>        <C>        <C>
The Adviser received the approximate accounting services
  fees of................................................  $41,400    $48,500    $47,200
</Table>



LEGAL SERVICES AGREEMENT



     The Fund and certain other Van Kampen funds have entered into legal
services agreements pursuant to which Van Kampen Investments provides legal
services, including without limitation: accurate maintenance of each fund's
minute books and records,


                                       S-14
<PAGE>


preparation and oversight of each fund's regulatory reports and other
information provided to shareholders, as well as responding to day-to-day legal
issues on behalf of the funds. Payment by the funds for such services is made on
a cost basis for the salary and salary-related benefits, including but not
limited to bonuses, group insurance and other regular wages for the employment
of personnel. Other funds distributed by the Administrator also receive legal
services from Van Kampen Investments. Of the total costs for legal services
provided to the funds distributed by the Administrator, one half of such costs
are allocated equally to each fund and the remaining one half of such costs are
allocated to specific funds based on monthly time records.



LEGAL SERVICES FEES



<Table>
<Caption>
                                                           FISCAL YEAR ENDED OCTOBER 31,
                                                           ------------------------------
                                                             2004       2003       2002
                                                           --------   --------   --------
<S>                                                        <C>        <C>        <C>
Van Kampen Investments received the approximate legal
  services fees of.......................................  $24,000    $25,800    $22,600
</Table>



                                FUND MANAGEMENT


OTHER ACCOUNTS MANAGED BY THE PORTFOLIO MANAGERS


     As of October 31, 2004, Thomas Byron managed 6 registered investment
companies with a total of $2.5 billion in assets; 0 pooled investment vehicles
other than registered investment companies; and 0 other accounts.



     As of October 31, 2004, Robert Wimmel managed 39 registered investment
companies with a total of $11.4 billion in assets; 0 pooled investment vehicles
other than registered investment companies; and 0 other accounts.



     As of October 31, 2004, John Reynoldson managed 36 registered investment
companies with a total of $8.3 billion in assets; 0 pooled investment vehicles
other than registered investment companies; and 295 other accounts with a total
of $239 million in assets.



     Because the portfolio managers manage assets for other investment
companies, pooled investment vehicles and/or other accounts (including
institutional clients, pension plans and certain high net worth individuals)
there may be an incentive to favor one client over another resulting in
conflicts of interest. For instance, the Adviser may receive fees from certain
accounts that are higher than the fee it receives from the Fund, or it may
receive a performance-based fee on certain accounts. In those instances, the
portfolio managers may have an incentive to favor the higher and/or
performance-based fee accounts over the Fund. The portfolio managers of the Fund
do not currently manage assets for other investment companies, pooled investment
vehicles or other accounts that charge a performance fee. The Adviser has
adopted trade allocation and other policies and procedures that it believes are
reasonably designed to address these and other conflicts of interest.


                                       S-15
<PAGE>

PORTFOLIO MANAGER COMPENSATION


     STRUCTURE.  Portfolio managers receive a combination of base compensation
and discretionary compensation, comprised of a cash bonus and several deferred
compensation programs described below. The methodology used to determine
portfolio manager compensation is applied across all accounts managed by the
portfolio manager.



     BASE SALARY COMPENSATION.  Generally, portfolio managers receive base
salary compensation based on the level of their position with the Adviser.


     DISCRETIONARY COMPENSATION.  In addition to base compensation, portfolio
managers may receive discretionary compensation. Discretionary compensation can
include:

     - Cash Bonus;

     - Morgan Stanley's Equity Incentive Compensation Program (EICP) awards--a
       mandatory program that defers a portion of discretionary year-end
       compensation into restricted stock units or other awards based on Morgan
       Stanley common stock that are subject to vesting and other conditions;


     - Investment Management Deferred Compensation Plan (IMDCP) awards--a
       mandatory program that defers a portion of discretionary year-end
       compensation and notionally invests it in designated funds advised by the
       Adviser or its affiliates. The award is subject to vesting and other
       conditions. Portfolio managers must notionally invest a minimum of 25% to
       a maximum of 50% of the IMDCP deferral into a combination of the
       designated funds they manage that are included in the IMDCP fund menu.



     - Select Employees' Capital Accumulation Program (SECAP) awards--a
       voluntary program that permits employees to elect to defer a portion of
       their discretionary compensation and notionally invest the deferred
       amount across a range of designated investment funds, including funds
       advised by the Adviser or its affiliates, and


     - Voluntary Equity Incentive Compensation Program (VEICP) awards--a
       voluntary program that permits employees to elect to defer a portion of
       their discretionary compensation to invest in Morgan Stanley stock units.

     Several factors determine discretionary compensation, which can vary by
portfolio management team and circumstances. In order of relative importance,
these factors include


     - Investment performance.  A portfolio manager's compensation is linked to
       the pre-tax investment performance of the accounts managed by the
       portfolio manager. Investment performance is calculated for one-, three
       and five-year periods measured against a fund's primary benchmark (as set
       forth in the fund's prospectus), indices and/or peer groups. Generally,
       the greatest weight is placed on the three- and five-year periods.



     - Revenues generated by the investment companies, pooled investment
       vehicles and other accounts managed by the portfolio manager.


     - Contribution to the business objectives of the Adviser.

                                       S-16
<PAGE>

     - The dollar amount of assets managed by the portfolio manager.


     - Market compensation survey research by independent third parties.


     - Other qualitative factors, such as contributions to client objectives.


     - Performance of Morgan Stanley and Morgan Stanley Investment Management,
       and the overall performance of the Global Investor Group, a department
       within Morgan Stanley Investment Management that includes all investment
       professionals.



     Occasionally, to attract new hires or to retain key employees, the total
amount of compensation will be guaranteed in advance of the fiscal year end
based on current market levels. In limited circumstances, the guarantee may
continue for more than one year. The guaranteed compensation is based on the
same factors as those comprising overall compensation described above.


SECURITIES OWNERSHIP OF PORTFOLIO MANAGERS


     As the Fund's fiscal year end, none of the portfolio managers owned equity
securities in the Fund.



                                 CODE OF ETHICS



     The Fund and the Adviser have adopted a Code of Ethics (the "Code of
Ethics") that sets forth general and specific standards relating to the
securities trading activities of their employees. The Code of Ethics does not
prohibit employees from acquiring securities that may be purchased or held by
the Fund, but is intended to ensure that all employees conduct their personal
transactions in a manner that does not interfere with the portfolio transactions
of the Fund or other Van Kampen funds, or that such employees take unfair
advantage of their relationship with the Fund. Among other things, the Code of
Ethics prohibits certain types of transactions absent prior approval, imposes
various trading restrictions (such as time periods during which personal
transactions may or may not be made) and requires quarterly reporting of
securities transactions and other reporting matters. All reportable securities
transactions and other required reports are to be reviewed by appropriate
personnel for compliance with the Code of Ethics. Additional restrictions apply
to portfolio managers, traders, research analysts and others who may have access
to nonpublic information about the trading activities of the Fund or other Van
Kampen funds or who otherwise are involved in the investment advisory process.
Exceptions to these and other provisions of the Code of Ethics may be granted in
particular circumstances after review by appropriate personnel.


                PORTFOLIO TRANSACTIONS AND BROKERAGE ALLOCATION

     The Adviser is 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 prices and any brokerage commissions on such transactions. While
the Adviser will be primarily responsible for the placement of the Fund's
portfolio business, the policies and practices in this regard are subject to
review by the Fund's Board of Trustees.

                                       S-17
<PAGE>

     As most transactions made by the Fund are principal transactions at net
prices, the Fund generally incurs little or no brokerage costs. The portfolio
securities in which the Fund invests are normally purchased directly from the
issuer or in the over-the-counter market from an underwriter or market maker for
the securities. Purchases from underwriters of portfolio securities include a
commission or concession paid by the issuer to the underwriter and purchases
from dealers serving as market makers include a spread or markup to the dealer
between the bid and asked price. Sales to dealers are effected at bid prices.
The Fund may also purchase certain money market instruments directly from an
issuer, in which case no commissions or discounts are paid, or may purchase and
sell listed securities on an exchange, which are effected through brokers who
charge a commission for their services.

     The Adviser is responsible for placing portfolio transactions and does so
in a manner deemed fair and reasonable to the Fund and not according to any
formula. The primary consideration in all portfolio transactions is prompt
execution of orders in an effective manner at the most favorable price. In
selecting broker-dealers and in negotiating prices and any brokerage commissions
on such transactions, the Adviser considers the firm's reliability, integrity
and financial condition and the firm's execution capability, the size and
breadth of the market for the security, the size of and difficulty in executing
the order, and the best net price. There are many instances when, in the
judgment of the Adviser, more than one firm can offer comparable execution
services. In selecting among such firms, consideration may be given to those
firms which supply research and other services in addition to execution
services. The Adviser is authorized to pay higher commissions to brokerage firms
that provide it with investment and research information than to firms which do
not provide such services if the Adviser determines that such commissions are
reasonable in relation to the overall services provided. No specific value can
be assigned to such research services which are furnished without cost to the
Adviser. Since statistical and other research information is only supplementary
to the research efforts of the Adviser to the Fund and still must be analyzed
and reviewed by its staff, the receipt of research information is not expected
to reduce its expenses materially. The investment advisory fee is not reduced as
a result of the Adviser's receipt of such research services. Services provided
may include (a) furnishing advice as to the value of securities, the
advisability of investing in, purchasing or selling securities, and the
availability of securities or purchasers or sellers of securities; (b)
furnishing analyses and reports concerning issuers, industries, securities,
economic factors and trends, portfolio strategy, and the performance of
accounts; and (c) effecting securities transactions and performing functions
incidental thereto (such as clearance, settlement and custody). Research
services furnished by firms through which the Fund effects its securities
transactions may be used by the Adviser in servicing all of its advisory
accounts; not all of such services may be used by the Adviser in connection with
the Fund.

     The Adviser also may place portfolio transactions, to the extent permitted
by law, with brokerage firms affiliated with the Fund and the Adviser if it
reasonably believes that the quality of execution and the commission are
comparable to that available from other qualified firms.

     The Adviser may place portfolio transactions at or about the same time for
other advisory accounts, including other investment companies. The Adviser seeks
to allocate portfolio transactions equitably whenever concurrent decisions are
made to purchase or sell securities for

                                       S-18
<PAGE>

the Fund and another advisory account. In some cases, this procedure could have
an adverse effect on the price or the amount of securities available to the
Fund. In making such allocations among the Fund and other advisory accounts, the
main factors considered by the Adviser are the respective sizes of the Fund and
other advisory accounts, 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
opinions of the persons responsible for recommending the investment.

     Certain broker-dealers, through which the Fund may effect securities
transactions, are affiliated persons (as defined in the 1940 Act) of the Fund or
affiliated persons of such affiliates, including Morgan Stanley or its
subsidiaries. The Fund's Board of Trustees has adopted certain policies
incorporating the standards of Rule 17e-1 issued by the SEC under the 1940 Act
which require that the commissions paid to affiliates of the Fund must be
reasonable and fair compared to the commissions, fees or other remuneration
received or to be received by other brokers in connection with comparable
transactions involving similar securities during a comparable period of time.
The rule and procedures also contain review requirements and require the Adviser
to furnish reports to the trustees and to maintain records in connection with
such reviews. After consideration of all factors deemed relevant, the trustees
will consider from time to time whether the advisory fee for the Fund will be
reduced by all or a portion of the brokerage commission paid to affiliated
brokers.

     Unless otherwise disclosed below, the Fund paid no commissions to
affiliated brokers during the last three fiscal years. The Fund paid the
following commissions to brokers during the fiscal years shown:


<Table>
<Caption>
                                                           AFFILIATED BROKERS
                                           ALL BROKERS   MORGAN STANLEY DW INC.
                                           -----------   ----------------------
<S>                                        <C>           <C>
COMMISSIONS PAID:
  Fiscal year ended October 31, 2004.....     1,195                0
  Fiscal year ended October 31, 2003.....    15,671                0
  Fiscal year ended October 31, 2002.....     4,411                0
FISCAL YEAR 2004 PERCENTAGES:
  Commissions with affiliate to total commissions.....             0%
  Value of brokerage transactions with affiliate to
     total transactions...............................             0%
</Table>


     During the fiscal year ended October 31, 2004, the Fund paid no brokerage
commissions to brokers selected primarily on the basis of research services
provided to the Adviser.


                             ADDITIONAL INFORMATION
           RELATING TO AUCTION PREFERRED SHARES OF THE ACQUIRING FUND



     The following is a brief description of the terms of the shares of each
series of APS of the Fund. This description does not purport to be complete and
is subject to and qualified in its entirety by reference to Fund's Declaration
of Trust, including the Certificate of Vote establishing and fixing the rights
and preferences of the shares of such series of APS attached hereto as Appendix
B (the "Certificate of Vote" and, together with the Fund's


                                       S-19
<PAGE>


Declaration of Trust, the "APS Provisions"). For purposes of this section,
capitalized terms not otherwise defined below are defined in the Certificate of
Vote.


     The Declaration of Trust currently authorizes the issuance of an unlimited
number of shares of Common Shares and 100,000,000 Preferred Shares of beneficial
interest, par value $.01 per share (which may be issued from time to time in
such series and with such designations, preferences and other rights,
qualifications, limitations and restrictions as are determined in a resolution
of the Board of Trustees of the Fund). Under the APS Provisions, the Fund
currently has outstanding 12,000 APS. All shares of each series of APS have a
liquidation preference of $25,000 per share plus an amount equal to accumulated
but unpaid dividends (whether or not earned or declared). The shares of each
series of APS will rank on a parity with shares of any other series of Preferred
Shares (including any other series of APS) as to the payment of dividends and
the distribution of assets upon liquidation. So long as either Moody's or S&P is
rating the shares of any series of APS, the Fund may, without the vote of the
holders of APS, issue additional series of Preferred Shares, including APS,
subject to applicable provisions of the 1940 Act and to continuing compliance
with the 1940 Act APS Asset Coverage and the APS Basic Maintenance Amount,
provided that (1) any such additional series ranks on a parity with the then
Outstanding APS as to the payment of dividends and the distribution of assets
upon liquidation and (2) the Fund obtains written confirmation from Moody's or
S&P, or both, as the case may be, that the issuance of any such additional
series would not impair the rating then assigned by such rating agency to the
APS.

DIVIDENDS AND DIVIDEND PERIODS

     Dividends on shares of each series of APS will accumulate at the Applicable
Rate per annum and will be payable, when, as and if declared by the Board of
Trustees of the Fund out of funds legally available therefor, on shares of APS
Series A on each Tuesday, on shares of APS Series B on each fourth Wednesday, on
shares of APS Series C on each Thursday and on shares of APS Series D on each
fourth Friday, in each case subject to certain exceptions. The Fund, subject to
certain conditions, may designate any Dividend Period as a Special Dividend
Period, which shall be such number of consecutive days or whole years as the
Board of Trustees shall specify, subject to certain exceptions.

     Dividends will be paid through the Securities Depository (The Depository
Trust Company or any successor) on each Dividend Payment Date in accordance with
its normal procedures, which now provide for it to distribute dividends in
next-day funds to Agent Members, who in turn are expected to distribute such
dividend payments to the persons for whom they are acting as agents. Each of the
initial Broker Dealers, however, has indicated to the Fund that such
Broker-Dealer or one of its affiliates will make such dividend payments
available in same-day funds on each Dividend Payment Date to customers that use
such Broker Dealer or such affiliate as Agent Member.


     For each Dividend Period, the dividend rate for shares of each series of
APS will be the Applicable Rate per annum that the Auction Agent advises the
Fund results from an Auction, except as provided below. The dividend rate that
results from an Auction for a series of APS will not be greater than the Maximum
Rate, which is:


     (i) in the case of any Auction Date which is not the Auction Date
         immediately prior to the first day of any proposed Special Dividend
         Period, the product of (1) the

                                       S-20
<PAGE>

         "AA" Composite Commercial Paper Rate on such Auction Date for the next
         Rate Period of such series and (2) the Applicable Percentage on such
         Auction Date, unless such series of APS has or had a Special Dividend
         Period (other than a Special Dividend Period of 28 days or less) and an
         Auction at which Sufficient Clearing Bids existed has not yet occurred
         for a Minimum Dividend Period for such series (7 days with respect to
         APS Series A and APS Series C and 28 days with respect to APS Series B
         and APS Series D) after such Special Dividend Period, in which case the
         higher of:

        (A)  the dividend rate on shares of such series of APS for the
             then-ending Rate Period, and


        (B)  the product of (x) the higher of (I) the "AA" Composite Commercial
             Paper Rate on such Auction Date for the then-ending Rate Period of
             such series, if such Rate Period is less than one year, or the
             Treasury Rate on such Auction Date for such Rate Period, if such
             Rate Period is one year or longer, and (II) the "AA" Composite
             Commercial Paper Rate on such Auction Date for such Special
             Dividend Period of such series, if such Special Dividend Period is
             less than one year, or the Treasury Rate on such Auction Date for
             such Special Dividend Period, if such Special Dividend Period is
             one year or longer and (y) the Applicable Percentage on such
             Auction Date; or


     (ii) in the case of any Auction Date which is the Auction Date immediately
          prior to the first day of any proposed Special Dividend Period, the
          product of (1) the highest of (x) the "AA" Composite Commercial Paper
          Rate on such Auction Date for the then-ending Rate Period of such
          series, if such Rate Period is less than one year, or the Treasury
          Rate on such Auction Date for such Rate Period, if such Rate Period is
          one year or longer, (y) the "AA" Composite Commercial Paper Rate on
          such Auction Date for the Special Dividend Period of such series for
          which the Auction is being held if such Special Dividend Period is
          less than one year or the Treasury Rate on such Auction Date for the
          Special Dividend Period for which the Auction is being held if such
          Special Dividend Period is one year or longer, and (z) the "AA"
          Composite Commercial Paper Rate on such Auction Date for a Minimum
          Dividend Period and (2) the Applicable Percentage on such Auction
          Date.

     The applicable "AA" Composite Commercial Paper Rates and Treasury Rates
will be the rates announced on such Auction Date for the Business Day
immediately prior to such Auction Date.

                                       S-21
<PAGE>

     The "Applicable Percentage" will be a percentage, determined as set forth
below, based on the prevailing rating of the APS in effect at the close of
business on the Business Day next preceding such Auction Date:

<Table>
<Caption>
                                                             APPLICABLE
PREVAILING RATING                                            PERCENTAGE
- -----------------                                            ----------
<S>                                                          <C>
"Aa3"/AA- or higher........................................     110%
"A3"/A-....................................................     125%
"Baa3"/BBB.................................................     150%
"Ba3"/BB-..................................................     200%
Below "Ba3"/BB-............................................     250%
</Table>

provided, however, that in the event the Fund has notified the Auction Agent of
its intent to allocate income that is taxable for federal income tax purposes to
the APS prior to any Auction, for purposes of determining the Maximum Rate with
respect to such Auction the Applicable Percentage in the foregoing table shall
be divided by the quantity 1 minus the maximum marginal regular federal
individual income tax rate applicable to ordinary income or the maximum marginal
regular federal corporate income tax rate, whichever is greater, provided,
however, that the Applicable Percentage shall be divided in the foregoing manner
only to the extent that the portion of the dividend on the APS for such Rate
Period that represents the allocation of taxable income to the APS. If the APS
are rated by only one rating agency, such rating will be the prevailing rating.
If the ratings for the APS are split between two of the foregoing categories,
the lower rating will determine the prevailing rating.

     If an Auction for any Dividend Period of any series of APS is not held for
any reason or if the Fund fails to pay in a timely manner to the Auction Agent
the full amount of any dividend on, or Redemption Price of, shares of any series
of APS and such failure has not been cured as set forth below prior to any
succeeding Dividend Period thereof, then, subject to the next paragraph, the
dividend rate on the shares of such series for any such Dividend Period will be
the Maximum Rate for such series on the Auction Date for such Dividend Period.

     If the Fund fails to pay in a timely manner to the Auction Agent the full
amount of any dividend on, or the Redemption Price of, any shares of any series
of APS during any Rate Period thereof (other than any Special Dividend Period
consisting of four or more Dividend Periods or any Rate Period succeeding any
Special Dividend Period consisting of four or more Dividend Periods during which
such a failure occurred that has not been cured), and, prior to 12:00 Noon on
the third Business Day next succeeding the date on which such failure occurred,
such failure shall not have been cured or the Fund shall not have paid a late
charge, then Auctions for such series will be suspended until such failure is so
cured and the dividend rate for such shares of APS for each Dividend Period
thereof commencing after such failure to and including the Dividend Period, if
any, during which such failure is so cured shall be a rate per annum equal to
the Maximum Rate on the Auction Date for each such Dividend Period (but with the
prevailing rating for such shares, for purposes of determining such Maximum
Rate, being deemed to be "Below "Ba3"/BB-"). If the Fund fails to pay in a
timely manner to the Auction Agent the full amount of any dividend on, or the
Redemption Price of, any shares of any series of APS during a Special Dividend
Period thereof consisting of four or more Dividend Periods, or

                                       S-22
<PAGE>

during any Dividend Period thereof succeeding any Special Dividend Period
consisting of four or more Dividend Periods during which such a failure occurred
that has not been cured, and such failure shall not have been cured as described
herein, then Auctions for such series will be suspended until such failure is so
cured and the dividend rate for such shares of APS for each Dividend Period
thereof commencing after such failure to and including the Dividend Period, if
any, during which such failure is so cured shall be a rate per annum equal to
the Maximum Rate on the Auction Date for each such Dividend Period (but with the
prevailing rating for such shares, for purposes of determining such Maximum
Rate, being deemed to be "Below "Ba3"/BB-").

DESIGNATION OF SPECIAL DIVIDEND PERIODS


     The Fund, at its option, may designate any succeeding Dividend Period of
any series of APS as a Special Dividend Period which shall consist of such
number of days or whole years as the Board of Trustees shall specify; provided,
however, that such designation shall be effective only if (i) notice thereof
shall have been given as provided in the APS Provisions, (ii) any failure to pay
in a timely manner to the Auction Agent the full amount of any dividend on, or
the Redemption Price of, shares of such series of APS shall have been cured as
set forth above, (iii) Sufficient Clearing Bids for such series shall have
existed in an Auction held on the Auction Date immediately preceding the first
day of such proposed Special Dividend Period, (iv) if the Fund shall have mailed
a notice of redemption with respect to any shares of such series, the Redemption
Price with respect to such shares shall have been deposited with the Auction
Agent, and (v) in the event the Fund wishes to designate any succeeding Dividend
Period for such series as a Special Dividend Period consisting of more than 28
days, the Fund has received written confirmation from S&P (if S&P is then rating
the APS) and Moody's (if Moody's is then rating the APS) that such designation
would not affect the rating then assigned by S&P to such series.


ADDITIONAL DIVIDENDS

     Whenever the Fund intends to include any net capital gains or other income
that is taxable for federal income tax purposes in any dividend on shares of any
series of APS, the Fund will notify the Auction Agent of the amount to be so
included 15 days prior to the Auction Date on which the Applicable Rate for such
dividend is to be established. Whenever the Auction Agent receives such notice
from the Fund, it will in turn notify each Broker-Dealer, who, on or prior to
such Auction Date, in accordance with its Broker-Dealer Agreement, will notify
its Existing Holders and Potential Holders believed by it to be interested in
submitting an Order in the Auction to be held on such Auction Date.

     If the Fund retroactively allocates any net capital gains or other income
taxable for federal income tax purposes to the APS without having given advance
notice thereof to the Auction Agent solely by reason of the fact that such
allocation is made as a result of the redemption of all or a portion of the
outstanding APS or the liquidation of the Fund (such allocation is referred to
herein as a "Retroactive Taxable Allocation"), the Fund will, within 270 days
after the end of the Fund's taxable year in which a Retroactive Taxable
Allocation is made, provide notice thereof to the Auction Agent and to each
holder of APS during such taxable year at such holder's address as the same
appears or last appeared on the share books of the Fund. The Fund will, within
30 days after such notice

                                       S-23
<PAGE>

is given to the Auction Agent, pay to the Auction Agent (who will then
distribute to such holders of shares of APS), out of funds legally available
therefor, an amount equal to the aggregate Additional Dividends (as defined
below) with respect to all Retroactive Taxable Allocations made to such holders
during the taxable year in question.

     "Additional Dividends" means payment to a Holder of APS of an amount which,
when taken together with the aggregate amount of Retroactive Taxable Allocations
made to such Holder with respect to the taxable year in question, would cause
such Holder's dividends in dollars (after federal income tax consequences as
described below) from the aggregate of both the Retroactive Taxable Allocations
and the Additional Dividends to be equal to the dollar amount of the dividends
which would have been received by such Holder if the amount of the aggregate
Retroactive Taxable Allocations would have been excludable from the gross income
of such Holder. State taxes imposed on the Additional Dividends, however, may
reduce the amount of after tax cash a holder would have had if there were no
Retroactive Taxable Allocation. Such Additional Dividends shall be calculated
(i) without consideration being given to the time value of money; (ii) assuming
that no holder of APS is subject to the federal alternative minimum tax with
respect to dividends received from the Fund; and (iii) assuming that each
Retroactive Taxable Allocation would be taxable in the hands of each holder of
APS at the maximum marginal regular federal individual income tax rate
applicable to ordinary income or net capital gains, as applicable, or the
maximum marginal regular federal corporate income tax rate, whichever is
greater, in effect during the taxable year in question.

AUCTION PROCEDURES

     On each Auction Date for each series of APS (the Business Day prior to the
beginning of each Rate Period), each Existing Holder may submit Orders through a
Broker-Dealer to the Auction Agent as follows:

     - Hold Order-indicating its desire to hold without regard to the Applicable
       Rate for the next Rate Period.

     - Bid-indicating its desire to sell if the Applicable Rate for the next
       Rate Period is less than the rate specified in such Bid.

     - Sell Order-indicating its desire to sell without regard to the Applicable
       Rate for the next Rate Period.

     An Existing Holder may submit different types of Orders in an Auction with
respect to shares of APS then held by such Existing Holder. An Existing Holder
that offers to purchase additional shares of APS is, for purposes of such offer,
treated as a Potential Holder as described below. Bids of Existing Holders with
rates higher than the Maximum Rate on the Auction Date will be treated as Sell
Orders. A Hold Order will be deemed to have been submitted on behalf of an
Existing Holder if an Order is not submitted on behalf of such Existing Holder
for any reason, including the failure of a Broker-Dealer to submit such Existing
Holder's Order to the Auction Agent.

     Potential Holders of shares of any series of APS may submit Bids in which
they will offer to purchase shares of such series of APS if the Applicable Rate
for the next Rate Period is not less than the rate specified in such Bid. A Bid
by a Potential Holder specifying a rate higher than the Maximum Rate will not be
accepted.

                                       S-24
<PAGE>


     If Sufficient Clearing Bids exist (that is, the number of shares of a
particular series of APS subject to Bids by Potential Holders with rates equal
to or lower than the Maximum Rate is at least equal to the number of shares of
such series of APS subject to Sell Orders by Existing Holders), the Applicable
Rate for such series will be the lowest rate specified in the Submitted Bids
which, taking into account such rate and all lower rates bid by Existing Holders
and Potential Holders, would result in Existing Holders and Potential Holders
owning all the shares of such series of APS available for purchase in the
Auction. If Sufficient Clearing Bids do not exist, the Applicable Rate will be
the Maximum Rate on the Auction Date, and, in such event, Existing Holders that
have submitted Sell Orders may not be able to sell in such Auction all shares of
such series of APS subject to such Sell Orders. If all Existing Holders of
shares of such series of APS submit or are deemed to have submitted Hold Orders,
the Applicable Rate will be the product of (i) (1) the "AA" Composite Commercial
Paper Rate on such Auction Date for the Rate Period for which the Auction is
held, if such Rate Period is less than one year or (2) the Treasury Rate on such
Auction Date for such Rate Period, if such Rate Period is one year or longer and
(ii) 1 minus the maximum marginal regular federal individual income tax rate
applicable to ordinary income or the maximum marginal regular federal corporate
income tax rate, whichever is greater; provided, however, that if the Fund has
notified the Auction Agent of its intent to allocate to the APS in such Rate
Period any net capital gains or other income that is taxable for federal income
tax purposes, the Applicable Rate in respect of that portion of the dividend on
the APS for such Rate Period that represents the allocation of net capital gains
or other income taxable for Federal income tax purposes will be the rate
described in the preceding clause (i) (1) or (2), as applicable, without being
multiplied by the factor set forth in the preceding clause (ii).


     The Auction Procedures include a pro rata allocation of shares for purchase
and sale, which may result in an Existing Holder continuing to hold or selling,
or a Potential Holder purchasing, a number of shares of APS that is fewer than
the number of shares of APS specified in its Order.

     A Bid placed by an Existing Holder specifying a rate greater than the
Applicable Rate determined in the Auction or a Sell Order shall constitute an
irrevocable offer to sell the shares of such series of APS subject thereto, in
each case at a price per share equal to $25,000. A Bid placed by a Potential
Holder shall constitute an irrevocable offer to purchase the shares of such
series of APS subject thereto at a price per share equal to $25,000 if the rate
specified in such Bid is less than or equal to the Applicable Rate determined in
the Auction. Settlement of purchases and sales will be made on the next Business
Day (also a Dividend Payment Date) after the Auction Date through the Securities
Depository. Purchasers will make payment through their Agent Members in same-day
funds to the Securities Depository against delivery to their respective Agent
Members. The Securities Depository will make payment to the sellers' Agent
Members in accordance with the Securities Depository's normal procedures, which
now provide for payment against delivery by their Agent Members in same-day
funds.

ASSET MAINTENANCE


     Under the APS Provisions, the Fund must maintain (i) assets having in the
aggregate a Discounted Value at least equal to the APS Basic Maintenance Amount,
and (ii) 1940 Act APS Asset Coverage of at least 200%.


                                       S-25
<PAGE>

     The Discount Factors and guidelines for calculating the Discounted Value of
the Fund's portfolio for purposes of determining whether the APS Basic
Maintenance Amount has been satisfied have been established by Moody's and S&P
in connection with the Fund's receipt of ratings on the shares of each series of
APS of "Aaa" from Moody's and AAA from S&P.

MINIMUM LIQUIDITY LEVEL

     So long as any of the APS are Outstanding and S&P is rating the APS, the
Fund will be required under the APS Provisions to maintain as of each Valuation
Date certain Dividend Coverage Assets with a value not less than the Dividend
Coverage Amount (the "Minimum Liquidity Level").

MANDATORY REDEMPTION


     If the APS Basic Maintenance Amount or the 1940 Act APS Asset Coverage is
not maintained or restored as specified in the APS Provisions, the APS will be
subject to mandatory redemption on a date specified by the Board of Trustees,
out of funds legally available therefor, at the redemption price of $25,000 per
share plus an amount equal to accumulated but unpaid dividends thereon (whether
or not earned or declared) to the date fixed for redemption. Any such redemption
will be limited to the number of APS necessary to restore the APS Basic
Maintenance Amount or the 1940 Act APS Asset Coverage, as the case may be.


OPTIONAL REDEMPTION


     Except as described in the APS Provisions shares of each series of APS are
redeemable, in whole or in part, at the option of the Fund, on the next
succeeding scheduled Dividend Payment Date applicable to the shares of such
series of APS called for redemption, out of funds legally available therefor, at
the Optional Redemption Price of $25,000 per share plus (in the case of a
Special Dividend Period only) a premium, if any, resulting from the designation
of a Premium Call Period, plus an amount equal to dividends thereon (whether or
not earned or declared) accumulated but unpaid to the date fixed for redemption;
provided that during a Special Dividend Period of 365 days or more, no share of
such series of APS will be subject to optional redemption during any Non-Call
Period to which such series of APS may be subject.


LIQUIDATION PREFERENCE

     The liquidation preference of the shares of each series of APS is $25,000
per share plus accumulated but unpaid dividends, if any, thereon (whether or not
earned or declared).

VOTING RIGHTS

     The 1940 Act requires that the holders of APS, voting as a separate class,
have the right to elect at least two Trustees at all times and to elect a
majority of the Trustees at any time that two years' dividends on the APS are
unpaid. The holders of APS will vote as a separate class or classes on certain
other matters as required under the APS

                                       S-26
<PAGE>

Provisions, the 1940 Act and Massachusetts law. In addition, each series of APS
may vote as a separate series under certain circumstances.

MASTER PURCHASER'S LETTER

     Each prospective purchaser of shares of any series of APS or its
Broker-Dealer will be required to sign and deliver a Master Purchaser's Letter
to the Auction Agent in which such prospective purchaser or its Broker-Dealer
will agree, among other things, that (i) dispositions of shares of such series
of APS may be made only pursuant to a Bid or a Sell Order placed in an Auction,
or to or through a Broker-Dealer or to a person that has delivered a signed
Master Purchaser's Letter to the Auction Agent, provided that in the case of all
transfers other than those pursuant to Auctions, the Existing Holder of the
shares so transferred, its Agent Member or its Broker-Dealer advises the Auction
Agent of such transfer, and (ii) ownership of shares of such series of APS will
be maintained in book entry form by the Securities Depository for the account of
such prospective purchaser's Agent Member, which in turn will maintain records
of such prospective purchaser's beneficial ownership.

     Each prospective purchaser should ask its Broker-Dealer whether such
prospective purchaser should sign a Master Purchaser's Letter. If the
Broker-Dealer submits Orders for such prospective purchaser listing the
Broker-Dealer as the Existing Holder or the Potential Holder, a Master
Purchaser's Letter signed by such prospective purchaser may not be required.

     Execution by a prospective purchaser or its Broker-Dealer of a Master
Purchaser's Letter is not a commitment to purchase shares of APS in the offering
being made by this Prospectus or in any Auction, but is a condition precedent to
such purchaser's purchasing shares of APS. In addition, acceptance of a Master
Purchaser's Letter is not a guarantee that shares of APS will be available for
purchase.

     The Broker-Dealers may maintain a secondary trading market in the APS
outside of Auctions. They have no obligation to do so, however, and there can be
no assurance that a secondary market for the APS will develop or, if it does
develop, that it will provide holders with liquidity of investment. The APS will
not be registered on any stock exchange or on the National Association of
Securities Dealers Automated Quotations system.

RATING AGENCY GUIDELINES

     The Fund intends that, so long as shares of any series of APS are
Outstanding, the composition of its portfolio will reflect guidelines
established by Moody's and S&P in connection with the Fund's receipt on the Date
of Original Issue of the shares of each series of APS of ratings of "Aaa" from
Moody's and AAA from S&P. Moody's and S&P, nationally recognized independent
rating agencies, issue ratings for various securities reflecting their perceived
creditworthiness of such securities. The Fund will pay certain fees to Moody's
and S&P for rating shares of the APS. The guidelines have been developed by
Moody's and S&P in connection with other issuances of asset-backed and similar
securities, including debt obligations and adjustable rate preferred stock,
generally on a case-by-case basis through discussions with the issuers of these
securities. The guidelines are designed to ensure that assets underlying
outstanding debt or preferred stock will be sufficiently varied and will be of
sufficient quality and amount to justify investment grade

                                       S-27
<PAGE>

ratings. The guidelines do not have the force of law, but have been adopted by
the Fund in order to satisfy current requirements necessary for Moody's and S&P
to issue the above-described ratings for shares of each series of APS, which
ratings are generally relied upon by institutional investors in purchasing such
securities. In the context of a closed-end investment company such as the Fund,
therefore, the guidelines provide a set of tests for portfolio composition and
asset coverage that supplement (and in some cases are more restrictive than) the
applicable requirements under the 1940 Act. A rating agency's guidelines will
apply to shares of any series of APS only so long as such rating agency is
rating such shares.

     The Fund intends to maintain a Discounted Value for its portfolio at least
equal to the APS Basic Maintenance Amount and, in addition, so long as S&P is
rating the shares of any series of APS, the Fund intends to maintain a Minimum
Liquidity Level. Moody's and S&P have each established separate guidelines for
determining Discounted Value. To the extent any particular portfolio holding
does not satisfy the applicable rating agency's guidelines, all or a portion of
such holding's value will not be included in the calculation of Discounted Value
(as defined by such rating agency). The Moody's and S&P guidelines do not impose
any limitations on the percentage of Fund assets that may be invested in
holdings not eligible for inclusion in the calculation of the Discounted Value
of the Fund's portfolio. The amount of such assets included in the portfolio at
any time may vary depending upon the rating, diversification and other
characteristics of the Eligible Assets included in the portfolio, although it is
not anticipated that in the normal course of business the value of such assets
would exceed 20% of the Fund's total assets.

     In managing the Fund's portfolio, the Adviser will not alter the
composition of the Fund's portfolio if, in the reasonable belief of the Adviser,
the effect of any such alteration would be to cause the Fund to have Eligible
Assets with an aggregate Discounted Value, as of the immediately preceding
Valuation Date, less than the APS Basic Maintenance Amount as of such Valuation
Date; provided, however, that in the event that, as of the immediately preceding
Valuation Date, the aggregate Discounted Value of the Fund's Eligible Assets
exceeded the APS Basic Maintenance Amount by five percent or less, the Adviser
will not alter the composition of the Fund's portfolio in a manner reasonably
expected to reduce the aggregate Discounted Value of the Fund's Eligible Assets
unless the Fund shall have confirmed that, after giving effect to such
alteration, the aggregate Discounted Value of the Fund's Eligible Assets would
exceed the APS Basic Maintenance Amount.

     Upon any failure to maintain the required Discounted Value, the Fund will
seek to alter the composition of its portfolio to reattain the APS Basic
Maintenance Amount on or prior to the APS Basic Maintenance Cure Date, thereby
incurring additional transaction costs and possible losses and/or gains on
dispositions of portfolio securities. To the extent any such failure is not
cured in a timely manner, shares of each series of APS will be subject to
redemption if either Moody's or S&P is rating such shares.

     The Fund may, but is not required to, adopt any modifications to these
guidelines that may hereafter be established by Moody's and S&P. Failure to
adopt any such modifications, however, may result in a change in the ratings
described above or a withdrawal of ratings altogether. In addition, any rating
agency providing a rating for the shares of any series of APS may, at any time,
change or withdraw any such rating. As set forth in the APS Provisions, the
Board of Trustees may, without Shareholder approval,

                                       S-28
<PAGE>

modify certain definitions or policies which have been adopted by the Fund
pursuant to the rating agency guidelines, provided the Board of Trustees has
obtained written confirmation from Moody's and S&P, as appropriate, that any
such change would not impair the ratings then assigned by Moody's and S&P to any
series of APS. A rating agency's guidelines will apply to shares of any series
of APS only so long as such rating agency is rating such shares.

     The ratings on any series of the APS are not recommendations to purchase,
hold or sell shares of any series of APS, inasmuch as the ratings do not comment
as to market price or suitability for a particular investor nor do the rating
agency guidelines described above address the likelihood that a holder of shares
of any series of APS will be able to sell such shares in an Auction. The ratings
are based on current information furnished to Moody's and S&P by the Fund and
the Adviser, and information obtained from other sources. The ratings may be
changed, suspended or withdrawn as a result of changes in, or the unavailability
of, such information.

                               OTHER INFORMATION


CUSTODY OF ASSETS



     All securities owned by the Fund and all cash, including proceeds from the
sale of securities in the Fund's investment portfolio, are held by State Street
Bank and Trust Company, 225 West Franklin Street, Boston, Massachusetts 02110,
as custodian. The custodian also provides accounting services to the Fund.


PROXY VOTING POLICY AND PROCEDURES AND PROXY VOTING RECORD


     The Fund's Proxy Voting Policy and Procedures are included as Appendix E to
this Reorganization Statement of Additional Information. Information on how the
Fund voted proxies relating to portfolio securities during the most recent
twelve-month period ended June 30 is available without charge, upon request, by
calling (800) 341-2929 or by visiting our web site at www.vankampen.com. This
information is also available on the SEC's web site at http://www.sec.gov.


INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


     An independent registered public accounting firm for the Fund performs an
annual audit of the Fund's financial statements. The Fund's Board of Trustees
has engaged Deloitte & Touche LLP, located at Two Prudential Plaza, 180 North
Stetson, Chicago, Illinois 60601-6710, to be the Fund's independent registered
public accounting firm.


                              FINANCIAL STATEMENTS


     Incorporated herein by reference and included in their respective
entireties are (i) the audited financial statements of the Acquiring Fund for
the fiscal year ended October 31, 2004, as included in Appendix C hereto and
(ii) the audited financial statements of the Target Fund for fiscal year ended
October 31, 2004, as included in Appendix D hereto.


                                       S-29
<PAGE>


                         PRO FORMA FINANCIAL STATEMENTS



     Pro forma financial statements have not been prepared because, as of
February 28, 2005, the net asset value of the Target Fund did not exceed ten
percent of the Acquiring Fund's net asset value, which is the threshold under
applicable rules for which pro forma financial statements is required.


                                       S-30
<PAGE>




                                   APPENDIX A

                      AGREEMENT AND PLAN OF REORGANIZATION


























<PAGE>
                                   APPENDIX A

                                    FORM OF
                      AGREEMENT AND PLAN OF REORGANIZATION

         In order to consummate the Reorganization and in consideration of the
promises and the covenants and agreements hereinafter set forth, and intending
to be legally bound, Van Kampen XXXXXX, a registered closed-end investment
company, File No. 811-XXXX (the "Target Fund") and Van Kampen XXXXXX (the
"Acquiring Fund"), a registered closed-end investment company, File No.
811-XXXX, each hereby agree as follows:

1.       Representations and Warranties of the Acquiring Fund.

         The Acquiring Fund represents and warrants to, and agrees with, the
Target Fund that:

         (a)      The Acquiring Fund is a trust, with transferable shares, duly
                  organized, validly existing and in good standing in conformity
                  with the laws of its jurisdiction of organization, and has the
                  power to own all of its assets and to carry out this
                  Agreement. The Acquiring Fund has all necessary federal, state
                  and local authorizations to carry on its business as it is now
                  being conducted and to carry out this Agreement.


         (b)      The Acquiring Fund is duly registered under the Investment
                  Company Act of 1940, as amended (the "1940 Act") as a
                  [non-]diversified, closed-end management investment company
                  and such registration has not been revoked or rescinded and is
                  in full force and effect. The Acquiring Fund has elected and
                  qualified for the special tax treatment afforded regulated
                  investment companies ("RICs") under Section 851 of the
                  Internal Revenue Code (the "Code") at all times since its
                  inception and intends to continue to so qualify until
                  consummation of the reorganization contemplated hereby (the
                  "Reorganization") and thereafter.



         (c)      The Target Fund has been furnished with the Acquiring Fund's
                  Annual Report to Shareholders for the fiscal year ended XXXX,
                  2004, and the audited financial statements appearing therein,
                  having been audited by Deloitte & Touche LLP, independent
                  registered public accounting firm, fairly present the
                  financial position of the Acquiring Fund as of the respective
                  dates indicated, in conformity with accounting principles
                  generally accepted in the United States applied on a
                  consistent basis.



         (d)      An unaudited statement of assets, liabilities and capital of
                  the Acquiring Fund and an unaudited schedule of investments of
                  the Acquiring Fund, each as of the Valuation Time (as defined
                  in Section 5(d) of this Agreement), will be furnished to the
                  Target Fund, at or prior to the Closing Date (as defined in
                  Section 7(a) herein), for the purpose of determining the
                  number of Acquiring Fund Common Shares and Acquiring Fund APS
                  to be issued pursuant to Section 6 of this Agreement; each
                  will fairly present the financial position of the Acquiring
                  Fund as of the Valuation Time in conformity with generally
                  accepted accounting principles applied on a consistent basis.


         (e)      The Acquiring Fund has full power and authority to enter into
                  and perform its obligations under this Agreement. The
                  execution, delivery and performance of this Agreement has been
                  duly authorized by all necessary action of its Board of
                  Trustees, and this Agreement constitutes a valid and binding
                  contract enforceable in accordance with its terms, subject to
                  the effects of bankruptcy, insolvency, moratorium, fraudulent
                  conveyance and similar



                                      A-1

<PAGE>


                  laws relating to or affecting creditors' rights generally and
                  court decisions with respect thereto.

         (f)      There are no material legal, administrative or other
                  proceedings pending or, to the knowledge of the Acquiring
                  Fund, threatened against it which assert liability on the part
                  of the Acquiring Fund or which materially affect its financial
                  condition or its ability to consummate the Reorganization. The
                  Acquiring Fund is not charged with or, to the best of its
                  knowledge, threatened with any violation or investigation of
                  any possible violation of any provisions of any federal, state
                  or local law or regulation or administrative ruling relating
                  to any aspect of its business.


         (g)      The Acquiring Fund is not obligated under any provision of its
                  Declaration of Trust, as amended, or its by-laws, as amended,
                  and is not a party to any contract or other commitment or
                  obligation, and is not subject to any order or decree which
                  would be violated by its execution of or performance under
                  this Agreement, except insofar as the Funds have mutually
                  agreed to amend such contract or other commitment or
                  obligation to cure any potential violation as a condition
                  precedent to the Reorganization.



         (h)      There are no material contracts outstanding to which the
                  Acquiring Fund is a party that have not been disclosed in the
                  N-14 Registration Statement (as defined in subsection (k)
                  below) or that will not otherwise be disclosed to the Target
                  Fund prior to the Valuation Time.



         (i)      The Acquiring Fund has no known liabilities of a material
                  amount, contingent or otherwise, other than those shown on its
                  statements of assets, liabilities and capital referred to in
                  subsection (c) above, those incurred in the ordinary course of
                  its business as an investment company, and those incurred in
                  connection with the Reorganization. As of the Valuation Time,
                  the Acquiring Fund will advise the Target Fund in writing of
                  all known liabilities, contingent or otherwise, whether or not
                  incurred in the ordinary course of business, existing or
                  accrued as of such time, except to the extent disclosed in the
                  financial statements referred to in subsection (c) above.


         (j)      No consent, approval, authorization or order of any court or
                  government authority is required for the consummation by the
                  Acquiring Fund of the Reorganization, except such as may be
                  required under the Securities Act of 1933, as amended (the
                  "1933 Act"), the Securities Exchange Act of 1934, as amended
                  (the "1934 Act") and the 1940 Act or state securities laws
                  (which term as used herein shall include the laws of the
                  District of Columbia and Puerto Rico).


         (k)      The registration statement filed by the Acquiring Fund on Form
                  N-14, which includes the proxy statement of the Target Fund
                  and the Acquiring Fund with respect to the transactions
                  contemplated herein (the "Joint Proxy Statement/Prospectus"),
                  and any supplement or amendment thereto or to the documents
                  therein (as amended or supplemented, the "N-14 Registration
                  Statement"), on its effective date, at the time of the
                  shareholders' meetings referred to in Section 8(a) of this
                  Agreement and at the Closing Date, insofar as it relates to
                  the Acquiring Fund, (i) complied or will comply in all
                  material respects with the provisions of the 1933 Act, the
                  1934 Act and the 1940 Act and the rules and regulations
                  thereunder and (ii) did not or will not contain any



                                      A-2

<PAGE>

                  untrue statement of a material fact or omit to state any
                  material fact required to be stated therein or necessary to
                  make the statements therein not misleading; and the Joint
                  Proxy Statement/Prospectus included therein did not or will
                  not contain any untrue statement of a material fact or omit to
                  state any material fact necessary to make the statements
                  therein, in the light of the circumstances under which they
                  were made, not misleading; provided, however, that the
                  representations and warranties in this subsection only shall
                  apply to statements in or omissions from the N-14 Registration
                  Statement made in reliance upon and in conformity with
                  information furnished by the Acquiring Fund for use in the
                  N-14 Registration Statement.


         (l)      The Acquiring Fund is authorized to issue an unlimited number


                  of common shares of beneficial interest, par value $.01 per
                  share (the "Acquiring Fund Common Shares"), and XXXX preferred
                  shares of beneficial interest, par value $.01 per share. The
                  Board of Trustees of the Acquiring Fund has designated XXXX
                  preferred shares as Auction Preferred Shares ("Acquiring Fund
                  APS"). Each outstanding Acquiring Fund Common Share and each
                  Acquiring Fund APS of the Acquiring Fund is fully paid and,
                  except as provided in Section 5.1 of the Acquiring Fund's
                  Declaration of Trust, nonassessable, and has full voting
                  rights.



         (m)      The Acquiring Fund Common Shares and the Acquiring Fund APS to
                  be issued to the Target Fund pursuant to this Agreement will
                  have been duly authorized and, when issued and delivered
                  pursuant to this Agreement, will be legally and validly issued
                  and will be fully paid and, except as provided in Section 5.1
                  of the Acquiring Fund's Declaration of Trust, nonassessable
                  and will have full voting rights, and no shareholder of the
                  Acquiring Fund will have any preemptive right of subscription
                  or purchase in respect thereof.


         (n)      At or prior to the Closing Date, the Acquiring Fund Common
                  Shares to be transferred to the Target Fund for distribution
                  to the shareholders of the Target Fund on the Closing Date
                  will be duly qualified for offering to the public in all
                  states of the United States in which the sale of shares of the
                  Funds presently are qualified, and there will be a sufficient
                  number of such shares registered under the 1933 Act and, as
                  may be necessary, with each pertinent state securities
                  commission to permit the transfers contemplated by this
                  Agreement to be consummated.

         (o)      At or prior to the Closing Date, the Acquiring Fund APS to be
                  transferred to the Target Fund on the Closing Date will be
                  duly qualified for offering to the public in all states of the
                  United States in which the sale of APS of the Target Fund
                  presently are qualified, and there are a sufficient number of
                  Acquiring Fund APS registered under the 1933 Act and with each
                  pertinent state securities commission to permit the transfers
                  contemplated by this Agreement to be consummated.


         (p)      At or prior to the Closing Date, the Acquiring Fund will have
                  obtained any and all regulatory, trustee and shareholder
                  approvals necessary to issue the Acquiring Fund Common Shares
                  and the Acquiring Fund APS to the Target Fund.



         (q)      The Acquiring Fund has filed, or intends to file, or has
                  obtained extensions to file, all federal, state and local tax
                  returns which are required to be filed by it, and has paid or
                  has obtained extensions to pay, all federal, state and local
                  taxes shown on said returns to be due and owing and all
                  assessments received by it, up to and including the taxable
                  year in which the Closing Date occurs. All tax liabilities of
                  the Acquiring Fund have been adequately provided for on its
                  books, and no tax deficiency or liability of the Acquiring
                  Fund has been asserted and no question with respect thereto
                  has been raised by the Internal Revenue Service or by any
                  state or local tax authority for taxes in excess of those
                  already paid, up to and including the taxable year in which
                  the Closing Date occurs.


         (r)      The Acquiring Fund has elected to qualify and has qualified as
                  a RIC as of and since its inception; has been a RIC under the
                  Code at all times since the end of its first taxable year when
                  it so qualified; qualifies and will continue to qualify as a
                  RIC under the Code; and has satisfied the distribution
                  requirements imposed by the Code for each of its taxable
                  years.


2.       Representations and Warranties of the Target Fund.

         The Target Fund represents and warrants to, and agrees with, the
Acquiring Fund that:

         (a)      The Target Fund is a trust, with transferable shares, duly
                  organized, validly existing and in good standing in conformity
                  with the laws of the jurisdiction of its organization, and has
                  the power to own all of its assets and to carry out this
                  Agreement. The Target Fund has all necessary federal, state
                  and local authorizations to carry on its business as it is now
                  being conducted and to carry out this Agreement.

                                      A-3

<PAGE>



         (b)      The Target Fund is duly registered under the 1940 Act as a
                  [non-]diversified, closed-end management investment company,
                  and such registration has not been revoked or rescinded and is
                  in full force and effect. The Target Fund has elected and
                  qualified for the special tax treatment afforded RICs under
                  Section 851 of the Code at all times since its inception, and
                  intends to continue to so qualify through its taxable year
                  ending upon liquidation.


         (c)      As used in this Agreement, the term "Target Fund Investments"
                  shall mean (i) the investments of the Target Fund shown on the
                  schedule of its investments as of the Valuation Time furnished
                  to the Acquiring Fund; and (ii) all other assets owned by the
                  Target Fund or liabilities incurred as of the Valuation Time.

         (d)      The Target Fund has full power and authority to enter into and
                  perform its obligations under this Agreement. The execution,
                  delivery and performance of this Agreement has been duly
                  authorized by all necessary action of its Board of Trustees
                  and this Agreement constitutes a valid and binding contract
                  enforceable in accordance with its terms, subject to the
                  effects of bankruptcy, insolvency, moratorium, fraudulent
                  conveyance and similar laws relating to or affecting
                  creditors' rights generally and court decisions with respect
                  thereto.


         (e)      The Acquiring Fund has been furnished with the Target Fund's
                  Annual Report to Shareholders for the fiscal year ended XXXX,
                  2004, and the audited financial statements appearing therein,
                  having been audited by Deloitte & Touche LLP, independent
                  registered public accounting firm, fairly present the
                  financial position of the Target Fund as of the respective
                  dates indicated, in conformity with accounting principles
                  generally accepted in the United States applied on a
                  consistent basis.


         (f)      An unaudited statement of assets, liabilities and capital of
                  the Target Fund and an unaudited schedule of investments of
                  the Target Fund, each as of the Valuation Time, will be
                  furnished to the Acquiring Fund at or prior to the Closing
                  Date for the purpose of determining the number of shares of
                  Acquiring Fund Common Shares and Acquiring Fund APS to be
                  issued to the Target Fund pursuant to Section 3 of this
                  Agreement; each will fairly present the financial position of
                  the Target Fund as of the Valuation Time in conformity with
                  generally accepted accounting principles applied on a
                  consistent basis.

         (g)      There are no material legal, administrative or other
                  proceedings pending or, to the knowledge of the Target Fund,
                  threatened against it which assert liability on the part of
                  the Target Fund or which materially affect its financial
                  condition or its ability to consummate the Reorganization. The
                  Target Fund is not charged with or, to the best of its
                  knowledge, threatened with any violation or investigation of
                  any possible violation of any provisions of any federal, state
                  or local law or regulation or administrative ruling relating
                  to any aspect of its business.

         (h)      There are no material contracts outstanding to which the
                  Target Fund is a party that have not been disclosed in the
                  N-14 Registration Statement or will not otherwise be disclosed
                  to the Acquiring Fund prior to the Valuation Time.

         (i)      The Target Fund is not obligated under any provision of its
                  Declaration of Trust, as amended, or its by-laws, as amended,
                  or a party to any contract or other commitment or obligation,
                  and is not subject to any order or decree which would be
                  violated by its execution of or performance under this
                  Agreement, except insofar as the Funds have



                                       A-4

<PAGE>

                  mutually agreed to amend such contract or other commitment or
                  obligation to cure any potential violation as a condition
                  precedent to the Reorganization.


         (j)      The Target Fund has no known liabilities of a material amount,
                  contingent or otherwise, other than those shown on its
                  statements of assets, liabilities and capital referred to
                  above, those incurred in the ordinary course of its business
                  as an investment company and those incurred in connection with
                  the Reorganization. As of the Valuation Time, the Target Fund
                  will advise the Acquiring Fund in writing of all known
                  liabilities, contingent or otherwise, whether or not incurred
                  in the ordinary course of business, existing or accrued as of
                  such time.


         (k)      The Target Fund has filed, or intends to file, or has obtained
                  extensions to file, all federal, state and local tax returns
                  which are required to be filed by it, and has paid or has
                  obtained extensions to pay, all federal, state and local taxes
                  shown on said returns to be due and owing and all assessments
                  received by it, up to and including the taxable year in which
                  the Closing Date occurs. All tax liabilities of the Target
                  Fund have been adequately provided for on its books, and no
                  tax deficiency or liability of the Target Fund has been
                  asserted and no question with respect thereto has been raised
                  by the Internal Revenue Service or by any state or local tax
                  authority for taxes in excess of those already paid, up to and
                  including the taxable year in which the Closing Date occurs.

         (l)      At both the Valuation Time and the Closing Date, the Target
                  Fund will have full right, power and authority to sell,
                  assign, transfer and deliver the Target Fund Investments. At
                  the Closing Date, subject only to the obligation to deliver
                  the Target Fund Investments as contemplated by this Agreement,
                  the Target Fund will have good and marketable title to all of
                  the Target Fund Investments, and the Acquiring Fund will
                  acquire all of the Target Fund Investments free and clear of
                  any encumbrances, liens or security interests and without any
                  restrictions upon the transfer thereof (except those imposed
                  by the federal or state securities laws and those
                  imperfections of title or encumbrances as do not materially
                  detract from the value or use of the Target Fund Investments
                  or materially affect title thereto).

         (m)      No consent, approval, authorization or order of any court or
                  governmental authority is required for the consummation by the
                  Target Fund of the Reorganization, except such as may be
                  required under the 1933 Act, the 1934 Act, the 1940 Act or
                  state securities laws.


         (n)      The N-14 Registration Statement, on its effective date, at the
                  time of the shareholders' meetings called to vote on this
                  Agreement and on the Closing Date, insofar as it relates to
                  the Target Fund (i) complied or will comply in all material
                  respects with the provisions of the 1933 Act, the 1934 Act and
                  the 1940 Act and the rules and regulations thereunder, and
                  (ii) did not or will not contain any untrue statement of a
                  material fact or omit to state any material fact required to
                  be stated therein or necessary to make the statements therein
                  not misleading; and the Joint Proxy Statement/Prospectus
                  included therein did not or will not contain any untrue
                  statement of a material fact or omit to state any material
                  fact necessary to make the statements therein, in the light of
                  the circumstances under which they were made, not misleading;
                  provided, however, that the representations and warranties in
                  this subsection shall apply only to statements in or omissions
                  from the N-14 Registration Statement made in reliance upon and
                  in conformity with information furnished by the Target Fund
                  for use in the N-14 Registration Statement.


                                      A-5


<PAGE>


         (o)      The Target Fund is authorized to issue an unlimited number of
                  common shares of beneficial interest, par value $.01 per share
                  (the "Target Fund Common Shares"), and XXXX preferred shares
                  of beneficial interest, par value $.01 per share. The Board of
                  Trustees of the Acquiring Fund has designated XXXX preferred
                  shares as Target Fund Preferred Shares (the "Target Fund
                  Preferred Shares"). Each outstanding Target Fund Common Share
                  and each of the outstanding Target Fund Preferred Shares is
                  fully paid and, except as provided in Section 5.1 of the
                  Target Fund's Declaration of Trust, nonassessable, and has
                  full voting rights.



         (p)      All of the issued and outstanding Target Fund Common Shares
                  and Target Fund Preferred Shares were offered for sale and
                  sold in conformity with all applicable federal and state
                  securities laws.


         (q)      The books and records of the Target Fund made available to the
                  Acquiring Fund and/or its counsel are substantially true and
                  correct and contain no material misstatements or omissions
                  with respect to the operations of the Target Fund.

         (r)      The Target Fund will not sell or otherwise dispose of any of
                  the Acquiring Fund Common Shares or Acquiring Fund APS to be
                  received in the Reorganization, except in distribution to the
                  shareholders of the Target Fund, as provided in Section 3 of
                  this Agreement.


         (s)      The Target Fund has elected to qualify and has qualified as a
                  "RIC" under the Code as of and since its inception; has been a
                  RIC under the Code at all times since the end of its first
                  taxable year when it so qualified; qualifies and will continue
                  to qualify as a RIC under the Code for its taxable year ending
                  upon its liquidation; and has satisfied the distribution
                  requirements imposed by the Code for each of its taxable
                  years.


3.       The Reorganization.


         (a)      Subject to receiving the requisite approvals of the
                  shareholders of the Target Fund, and to the other terms and
                  conditions contained herein, (i) the Target Fund agrees to
                  convey, transfer and deliver to the Acquiring Fund and the
                  Acquiring Fund agrees to acquire from the Target Fund, on the
                  Closing Date, all of the Target Fund Investments (including
                  interest accrued as of the Valuation Time on debt
                  instruments), and assume substantially all of the liabilities
                  of the Target Fund, in exchange for that number of Target Fund
                  Common Shares and Target Fund Preferred Shares provided in
                  Section 4 of this Agreement. Pursuant to this Agreement, as
                  soon as practicable after the Closing Date, the Target Fund
                  will distribute all Acquiring Fund Common Shares and Acquiring
                  Fund APS received by it to its shareholders in exchange for
                  their Target Fund Common Shares and Target Fund Preferred
                  Shares. Such distributions shall be accomplished by the
                  opening of shareholder accounts on the share ledger records of
                  the Acquiring Fund in the amounts due the shareholders of the
                  Target Fund based on their respective holdings in the Target
                  Fund as of the Valuation Time.



         (b)      If it is determined that the portfolios of the Target Fund and
                  the Acquiring Fund, when aggregated, would contain investments
                  exceeding certain percentage limitations imposed upon the
                  Acquiring Fund with respect to such investments, the Target
                  Fund, if requested by the Acquiring Fund, will dispose of a
                  sufficient amount of such investments as may be necessary to
                  avoid violating such limitations as of the Closing Date.
                  Notwithstanding the foregoing, (a) nothing herein will require
                  the Target Fund to dispose of any portfolios, securities or
                  other investments, if, in the reasonable judgment of the
                  Target Fund's trustees or investment adviser, such disposition
                  would adversely affect the tax-free nature of the
                  Reorganization for federal income tax purposes or would
                  otherwise not be in the best interests of the Target Fund, and
                  (b) nothing will permit the Target Fund to dispose of any
                  portfolio securities or other investments if, in the
                  reasonable judgment of the Acquiring Fund's trustees or
                  investment adviser, such disposition would adversely affect
                  the tax-free nature of the Reorganization for federal income
                  tax purposes or would otherwise not be in the best interests
                  of the Acquiring Fund.



         (c)      Prior to the Closing Date, the Target Fund shall declare a
                  dividend or dividends which, together with all such previous
                  dividends, shall have the effect of distributing to their
                  respective shareholders all of their respective net investment
                  company taxable income to and including the Closing Date, if
                  any (computed without regard to any deduction for dividends
                  paid), and all of its net capital gain, if any, realized to
                  and including the Closing Date. In this regard and in
                  connection with the Reorganization, the last dividend period
                  for the Target Fund Preferred Shares prior to the Closing Date
                  may be shorter than the dividend period for such Target Fund
                  Preferred Shares determined as set forth in the applicable
                  Certificate of Vote pertaining to such Target Fund Preferred
                  Shares.


         (d)      The Target Fund will pay or cause to be paid to the Acquiring
                  Fund any interest the Target Fund receives on or after the
                  Closing Date with respect to any of the Target Fund
                  Investments transferred to the Acquiring Fund hereunder.


                                      A-6

<PAGE>


         (e)      The Valuation Time shall be 4:00 p.m., Eastern time, on XXXX,
                  2005, or such earlier or later day and time as may be mutually
                  agreed upon in writing (the "Valuation Time").


         (f)      Recourse for liabilities assumed from the Target Fund by the
                  Acquiring Fund in the Reorganization will be limited to the
                  net assets acquired by the Acquiring Fund. The known
                  liabilities of the Target Fund, as of the Valuation Time,
                  shall be confirmed to the Acquiring Fund pursuant to Section
                  2(j) of this Agreement.

         (g)      The Target Fund will be terminated following the Closing Date
                  by terminating its registration under the 1940 Act and its
                  organization under Massachusetts law and will withdraw its
                  authority to do business in any state where it is required to
                  do so.

         (h)      The Acquiring Fund will file with the Secretary of State of
                  The Commonwealth of Massachusetts, as required, any amendment
                  to its Certificate of Vote establishing the powers, rights and
                  preferences of the Acquiring Fund APS prior to the closing of
                  the Reorganization.

4.       Issuance and Valuation of Acquiring Fund Common Shares and Acquiring
Fund APS in the Reorganization.


Acquiring Fund Common Shares and Acquiring Fund APS of an aggregate net asset
value or aggregate liquidation preference, as the case may be, equal to the
value of the assets of the Target Fund acquired in the Reorganization determined
as hereinafter provided, reduced by the amount of liabilities of the Target Fund
assumed by the Acquiring Fund in the Reorganization, shall be issued by the
Acquiring Fund to the Target Fund in exchange for such assets of the Target
Fund. The Acquiring Fund will issue to the Target Fund (i) a number of Acquiring
Fund Common Shares, the aggregate net asset value of which will equal the
aggregate net asset value of the Target Fund Common Shares, determined as set
forth below, and (ii) a number of Acquiring Fund APS, the aggregate liquidation
preference and value of which will equal the aggregate liquidation preference
and value of the Target Fund Preferred Shares, determined as set forth below.



The net asset value of each of the Funds and the liquidation preference and
value of each of the Target Fund Preferred Shares and the Acquiring Fund APS
shall be determined as of the Valuation Time in accordance with the regular
procedures of the investment adviser, and no formula will be used to adjust the
net asset value so determined of any Fund to take into account differences in
realized and unrealized gains and losses. Values in all cases shall be
determined as of the Valuation Time. The value of the Target Fund Investments to
be transferred to the Acquiring Fund shall be determined pursuant to the regular
procedures of the investment adviser.



Such valuation and determination shall be made by the Acquiring Fund in
cooperation with the Target Fund and shall be confirmed in writing by the
Acquiring Fund to the Target Fund. The net asset value per share of the
Acquiring Fund Common Shares and the liquidation preference and value per share
of the Acquiring Fund APS shall be determined in accordance with such procedures
and the Acquiring Fund shall certify the computations involved. For purposes of
determining the net asset value of each of a Target Fund Common Share and an
Acquiring Fund Common Share, the value of the securities held by the applicable
Fund plus any cash or other assets (including interest accrued but not yet
received) minus all liabilities (including accrued expenses) and the aggregate
liquidation value of the outstanding shares of Target Fund Preferred Shares or
Acquiring Fund APS, as the case may be, is divided by the total number of Target
Fund Common Shares or Acquiring Fund Common Shares, as the case may be,
outstanding at such time.



                                      A-7


<PAGE>

 The Acquiring Fund shall issue to the Target Fund separate certificates or
share deposit receipts for the Acquiring Fund Common Shares and the Acquiring
Fund APS, each registered in the name of the Target Fund. The Target Fund shall
then distribute the Acquiring Fund Common Shares and the Acquiring Fund APS to
the holders of Target Fund Common Shares and Target Fund Preferred Shares by
redelivering the certificates or share deposit receipts evidencing ownership of
(i) the Acquiring Fund Common Shares to EquiServe Trust Company, N.A., as the
transfer agent and registrar for the Acquiring Fund Common Shares, for
distribution to the holders of Target Fund Common Shares on the basis of such
holder's proportionate interest in the aggregate net asset value of the Target
Fund Common Shares and (ii) the Acquiring Fund APS to Deutsche Bank Trust
Company Americas, as the transfer agent and registrar for the Acquiring Fund
APS, for distribution to the holders of Target Fund Preferred Shares on the
basis of such holder's proportionate interest in the aggregate liquidation
preference and value of the Target Fund Preferred Shares. With respect to any
Target Fund shareholder holding certificates evidencing ownership of Target Fund
Common Shares as of the Closing Date, and subject to the Acquiring Fund being
informed thereof in writing by the Target Fund, the Acquiring Fund will not
permit such shareholder to receive new certificates evidencing ownership of the
Acquiring Fund Common Shares or Acquiring Fund APS, exchange Acquiring Fund
Common Shares or Acquiring Fund APS credited to such shareholder's account for
shares of other investment companies managed by the Adviser or any of its
affiliates, or pledge or redeem such Acquiring Fund Common Shares or Acquiring
Fund APS, in any case, until notified by the Target Fund or its agent that such
shareholder has surrendered his or her outstanding certificates evidencing
ownership of Target Fund Common Shares or Target Fund Preferred Shares or, in
the event of lost certificates, posted adequate bond. The Target Fund, at its
own expense, will request its shareholders to surrender their outstanding
certificates evidencing ownership of Target Fund Common Shares or Target Fund
Preferred Shares, as the case may be, or post adequate bond therefor.



         No fractional shares of Acquiring Fund Common Shares will be issued to
holders of Target Fund Common Shares unless such shares are held in a Dividend
Reinvestment Plan account. In lieu thereof, the Acquiring Fund's transfer agent,
EquiServe Trust Company, N.A., will aggregate all fractional Acquiring Fund
Common Shares to be issued in connection with the Reorganization (other than
those issued to a Dividend Reinvestment Plan account) and sell the resulting
full shares on the New York Stock Exchange at the current market price for
Acquiring Fund Common Shares for the account of all holders of such fractional
interests, and each such holder will receive such holder's pro rata share of the
proceeds of such sale upon surrender of such holder's certificates representing
Acquiring Fund Common Shares.



5.      Payment of Expenses.



         (a)      With respect to expenses incurred in connection with the
                  Reorganization, the Target Fund and the Acquiring Fund will
                  share, in proportion to their respective projected declines in
                  total operating expenses, all expenses incurred in connection
                  with the Reorganization, including, but not limited to, all
                  costs related to the preparation and distribution of materials
                  distributed to each Fund's Board of Trustees; expenses
                  incurred in connection with the preparation of the Agreement
                  and Plan of Reorganization and a registration statement on
                  Form N-14; SEC and state securities commission filing fees and
                  legal and audit fees in connection with the Reorganization;
                  costs of printing and distributing the Joint Proxy Statement/
                  Prospectus; legal fees incurred preparing each Fund's board
                  materials, attending each Fund's board meetings and preparing
                  the minutes; auditing fees associated with each Fund's
                  financial statements; stock exchange fees, rating agency fees,
                  portfolio transfer taxes (if any) and any similar expenses
                  incurred in connection with the Reorganization.



         (b)      If for any reason the Reorganization is not consummated, no
                  party shall be liable to any other party for any damages
                  resulting therefrom, including, without limitation,
                  consequential damages, and the investment adviser shall pay
                  all expenses incurred by each Fund in connection with the
                  Reorganization.


                                      A-8


<PAGE>


6.      Covenants of the Funds.


         (a)      Each Fund covenants to operate its business as presently
                  conducted between the date hereof and the Closing Date.

         (b)      The Target Fund agrees that following the consummation of the
                  Reorganization, it will terminate in accordance with the laws
                  of The Commonwealth of Massachusetts and any other applicable
                  law, it will not make any distributions of any Acquiring Fund
                  Common Shares or Acquiring Fund APS other than to its
                  respective shareholders and without first paying or adequately
                  providing for the payment of all of its respective liabilities
                  not assumed by the Acquiring Fund, if any, and on and after
                  the Closing Date it shall not conduct any business except in
                  connection with its termination.

         (c)      The Target Fund undertakes that if the Reorganization is
                  consummated, it will file an application pursuant to Section
                  8(f) of the 1940 Act for an order declaring that the Target
                  Fund has ceased to be a registered investment company.

         (d)      The Acquiring Fund will file the N-14 Registration Statement
                  with the Securities and Exchange Commission (the "Commission")
                  and will use its best efforts to provide that the N-14
                  Registration Statement becomes effective as promptly as
                  practicable. Each Fund agrees to cooperate fully with the
                  other, and each will furnish to the other the information
                  relating to itself to be set forth in the N-14 Registration
                  Statement as required by the 1933 Act, the 1934 Act the 1940
                  Act, and the rules and regulations thereunder and the state
                  securities laws.

         (e)      The Acquiring Fund has no plan or intention to sell or
                  otherwise dispose of the Target Fund Investments, except for
                  dispositions made in the ordinary course of business.

         (f)      Each of the Funds agrees that by the Closing Date all of its
                  federal and other tax returns and reports required to be filed
                  on or before such date shall have been filed and all taxes
                  shown as due on said returns either have been paid or adequate
                  liability reserves have been provided for the payment of such
                  taxes.


                           The intention of the parties is that the transaction
                  contemplated by this Agreement will qualify as a
                  reorganization within the meaning of Section 368(a) of the
                  Internal Revenue Code. Neither the Acquiring Fund nor the
                  Target Fund shall take any action or cause any action to be
                  taken (including, without limitation, the filing of any tax
                  return) that is inconsistent with such treatment or results in
                  the failure of the transaction to qualify as a reorganization
                  within the meaning of Section 368(a) of the Internal Revenue
                  Code. At or prior to the Closing Date, the Acquiring Fund and
                  the Target Fund will take such action, or cause such action to
                  be taken, as is reasonably necessary to enable Skadden, Arps,
                  Slate, Meagher & Flom LLP ("Skadden"), special counsel to the
                  Funds, to render the tax opinion required herein (including,
                  without limitation, each party's execution of representations
                  reasonably requested by and addressed to Skadden.


                           In connection with this covenant, the Funds agree to
                  cooperate with each other in filing any tax return, amended
                  return or claim for refund, determining a liability for taxes
                  or a right to a refund of taxes or participating in or
                  conducting any audit or other proceeding in respect of taxes.
                  The Acquiring Fund agrees to retain for a period of ten (10)
                  years following the Closing Date all returns, schedules and
                  work papers and all material records or other documents
                  relating to tax matters of the Target Fund for each of such
                  Fund's taxable period first ending after the Closing Date and
                  for all prior taxable periods.


                           After the Closing Date, the Target Fund shall
                  prepare, or cause its agents to prepare, any federal, state or
                  local tax returns required to be filed by such fund with
                  respect to its final taxable year ending with its complete
                  liquidation and for any prior periods or taxable years and
                  further shall cause such tax returns to be duly filed with the
                  appropriate taxing authorities. Notwithstanding the
                  aforementioned provisions of this subsection, any expenses
                  incurred by the Target Fund (other than for payment of taxes)
                  in connection with the preparation and filing of said tax
                  returns after the Closing Date shall be borne by such Fund to
                  the extent such expenses have been accrued by such Fund in the
                  ordinary course without regard to the Reorganization; any
                  excess expenses shall be borne by the investment adviser or an
                  affiliate thereof.


                                      A-9

<PAGE>

         (g)      The Target Fund agrees to mail to its shareholders of record
                  entitled to vote at the special meeting of shareholders at
                  which action is to be considered regarding this Agreement, in
                  sufficient time to comply with requirements as to notice
                  thereof, a combined proxy statement and prospectus which
                  complies in all material respects with the applicable
                  provisions of Section 14(a) of the 1934 Act and Section 20(a)
                  of the 1940 Act, and the rules and regulations, respectively,
                  thereunder.



         (h)      Following the consummation of the Reorganization, the
                  Acquiring Fund will continue its business as a diversified,
                  closed-end management investment company registered under the
                  1940 Act.



7.      Closing Date.


         (a)      Delivery of the assets of the Target Fund to be transferred,
                  together with any other Target Fund Investments, and the
                  Acquiring Fund Common Shares and Acquiring Fund APS to be
                  issued as provided in this Agreement, shall be made at such
                  place and time as the Funds shall mutually agree on the next
                  full business day following the Valuation Time, or at such
                  other time and date agreed to by the Funds, the date and time
                  upon which such delivery is to take place being referred to
                  herein as the "Closing Date." To the extent that any Target
                  Fund Investments, for any reason, are not transferable on the
                  Closing Date, the Target Fund shall cause such Target Fund
                  Investments to be transferred to the Acquiring Fund's account
                  with its custodian at the earliest practicable date
                  thereafter.


         (b)      The Target Fund will deliver to the Acquiring Fund on the
                  Closing Date confirmation or other adequate evidence as to the
                  tax basis of the Target Fund Investments delivered to the
                  Acquiring Fund hereunder.



         (c)      As soon as practicable after the close of business on the
                  Closing Date, the Target Fund shall deliver to the Acquiring
                  Fund a list of the names and addresses of all of the
                  shareholders of record of the Target Fund on the Closing Date
                  and the number of Target Fund Common Shares and Target Fund
                  Preferred Shares owned by each such shareholder, certified to
                  the best of its knowledge and belief by the transfer agent for
                  the Target Fund or by its President.



8.    Conditions of the Target Fund.


         The obligations of the Target Fund hereunder shall be subject to the
following conditions:


         (a)      That this Agreement shall have been adopted, and the
                  Reorganization shall have been approved, by the Board of
                  Trustees of the Target Fund and by the affirmative vote of the
                  holders of a majority of each of the outstanding Target Fund
                  Common Shares and Target Fund Preferred Shares, each voting
                  separately as a class; and that the Acquiring Fund shall have
                  delivered to the Target Fund a copy of the resolution
                  approving this Agreement adopted by the Board of Trustees of
                  the Acquiring Fund, and a certificate setting forth the vote
                  of holders of Acquiring Fund Common Shares approving the
                  issuance of additional Acquiring Fund Common Shares, each
                  certified by its Secretary.



         (b)      That the Target Fund shall have received from the Acquiring
                  Fund a statement of assets, liabilities and capital, with
                  values determined as provided in Section 4 of this Agreement,
                  together with a schedule of such Fund's investments, all as of
                  the Valuation Time, certified on the Target Fund's behalf by
                  its President (or any Vice President) or its Treasurer, and a
                  certificate signed by the Fund's President (or any Vice
                  President) and its Treasurer, dated as of the Closing Date,
                  certifying that as of the Valuation Time and as of the Closing
                  Date there has been no material adverse change in the
                  financial position of the Target Fund since the date of such
                  Fund's most recent Annual or Semi-Annual Report,


                                      A-10
<PAGE>

                  as applicable, other than changes in its portfolio securities
                  since that date or changes in the market value of its
                  portfolio securities.


         (c)      That the Acquiring Fund shall have furnished to the Target
                  Fund a certificate signed by the Acquiring Fund's President
                  (or any Vice President) or its Treasurer, dated as of the
                  Closing Date, certifying that, as of the Valuation Time and as
                  of the Closing Date, all representations and warranties of the
                  Acquiring Fund made in this Agreement are true and correct in
                  all material respects with the same effect as if made at and
                  as of such dates, and that the Acquiring Fund has complied
                  with all of the agreements and satisfied all of the conditions
                  on its part to be performed or satisfied at or prior to each
                  of such dates.


         (d)      That there shall not be any material litigation pending with
                  respect to the matters contemplated by this Agreement.


         (e)      The Target Fund shall have received the opinion(s) of Skadden,
                  counsel for the Acquiring Fund, dated as of the Closing Date,
                  addressed to the Target Fund substantially in the form and to
                  the effect that:


                  (i)      the Acquiring Fund is duly formed and validly
                           existing under the laws of its state of organization;

                  (ii)     the Acquiring Fund is registered as a closed-end,
                           management investment company under the 1940 Act;


                  (iii)    this Agreement and the Reorganization provided for
                           herein and the execution of this Agreement have been
                           duly authorized and approved by all requisite action
                           of the Acquiring Fund, and this Agreement has been
                           duly executed and delivered by the Acquiring Fund and
                           (assuming this Agreement is a valid and binding
                           obligation of the other party hereto) is a valid and
                           binding obligation of the Acquiring Fund;



                  (iv)     neither the execution or delivery by the Acquiring
                           Fund of this Agreement nor the consummation by the
                           Acquiring Fund of the transactions contemplated
                           hereby violate any provision of any statute or any
                           published regulation or any judgment or order
                           disclosed to counsel by the Acquiring Fund as being
                           applicable to the Acquiring Fund;



                  (v)      the Acquiring Fund Common Shares and Acquiring Fund
                           APS have each been duly authorized and, upon issuance
                           thereof in accordance with this Agreement, each will
                           be validly issued, fully paid and, except as provided
                           in Section 5.1 of the Acquiring Fund's Declaration of
                           Trust, nonassessable; and



                  (vi)     to their knowledge and subject to the qualifications
                           set forth below, the execution and delivery by the
                           Acquiring Fund of this Agreement and the consummation
                           of the transactions herein contemplated do not
                           require, under the laws of its state of organization
                           or any state in which the Acquiring Fund is qualified
                           to do business or the federal laws of the United
                           States, the consent, approval, authorization,
                           registration, qualification or order of, or filing
                           with, any court or governmental agency or body
                           (except such as have been obtained). Counsel need
                           express no opinion, however, as to any such consent,
                           approval, authorization, registration, qualification,
                           order or filing which may be required as a result of
                           the involvement of other parties to this Agreement in
                           the transactions herein contemplated because of their
                           legal or regulatory status or because of any other
                           facts specifically pertaining to them;



                                      A-11

<PAGE>






         (f)      The Target Fund shall have obtained an opinion from Skadden,
                  Arps, dated as of the Closing Date, addressed to the Target
                  Fund, that the consummation of the transactions set forth in
                  this Agreement comply with the requirements of a
                  reorganization as described in Section 368(a) of the Internal
                  Revenue Code.



         (g)      That all proceedings taken by each of the Funds and its
                  counsel in connection with the Reorganization and all
                  documents incidental thereto shall be satisfactory in form and
                  substance to the others.



         (h)      That the N-14 Registration Statement shall have become
                  effective under the 1933 Act, and no stop order suspending
                  such effectiveness shall have been instituted or, to the
                  knowledge of the Acquiring Fund, be contemplated by the SEC.


9.       Acquiring Fund Conditions.

         The obligations of the Acquiring Fund hereunder shall be subject to the
following conditions:


         (a)      That this Agreement shall have been adopted, and the
                  Reorganization shall have been approved, by the Board of
                  Trustees of the Acquiring Fund and that the issuance of
                  additional Acquiring Fund Common Shares shall have been
                  approved by the affirmative vote of a majority of votes cast,
                  where total votes cast represented over 50% of all securities
                  entitled to vote; and the Target Fund shall have delivered to
                  the Acquiring Fund a copy of the resolution approving this
                  Agreement adopted by the Target Fund's Board of Trustees, and
                  a certificate setting forth the vote of the holders of Target
                  Fund Common Shares and Target Fund Preferred Shares obtained,
                  each certified by its Secretary.



         (b)      That the Target Fund shall have furnished to the Acquiring
                  Fund a statement of its assets, liabilities and capital, with
                  values determined as provided in Section 4 of this Agreement,
                  together with a schedule of investments with their respective
                  dates of acquisition and tax costs, all as of the Valuation
                  Time, certified on such Fund's behalf by its President (or any
                  Vice President) or its Treasurer, and a certificate signed by
                  such Fund's President


                                      A-12

<PAGE>


                  (or any Vice President) or its Treasurer, dated as of the
                  Closing Date, certifying that as of the Valuation Time and as
                  of the Closing Date there has been no material adverse change
                  in the financial position of the Target Fund since the date of
                  such Fund's most recent Annual Report or Semi-Annual Report,
                  as applicable, other than changes in the Target Fund
                  Investments since that date or changes in the market value of
                  the Target Fund Investments.



         (c)      That the Target Fund shall have furnished to the Acquiring
                  Fund a certificate signed by such Fund's President (or any
                  Vice President) or its Treasurer, dated the Closing Date,
                  certifying that as of the Valuation Time and as of the Closing
                  Date all representations and warranties of the Target Fund
                  made in this Agreement are true and correct in all material
                  respects with the same effect as if made at and as of such
                  dates and the Target Fund has complied with all of the
                  agreements and satisfied all of the conditions on its part to
                  be performed or satisfied at or prior to such dates.


         (d)      That there shall not be any material litigation pending with
                  respect to the matters contemplated by this Agreement.


         (e)      That the Acquiring Fund shall have received the opinion of
                  Skadden, counsel for the Target Fund, dated as of the Closing
                  Date, addressed to the Acquiring Fund, substantially in the
                  form and to the effect that:


                  (i)       the Target Fund is duly formed and validly existing
                            under the laws of its state of organization;

                  (ii)      the Target Fund is registered as a closed-end,
                            management investment company under the 1940 Act;


                  (iii)     this Agreement and the Reorganization provided for
                            herein and the execution of this Agreement have been
                            duly authorized by all requisite action of the
                            Target Fund, and this Agreement has been duly
                            executed and delivered by the Target Fund and
                            (assuming this Agreement is a valid and binding
                            obligation of the other party hereto) is a valid and
                            binding obligation of the Target Fund;



                  (iv)      neither the execution or delivery by the Target Fund
                            of this Agreement nor the consummation by the Target
                            Fund of the transactions contemplated hereby violate
                            any provision of any statute, or any published
                            regulation or any judgment or order disclosed to
                            them by the Target Fund as being applicable to the
                            Target Fund; and



                  (v)       to their knowledge and subject to the qualifications
                            set forth below, the execution and delivery by the
                            Target Fund of the Agreement and the consummation of
                            the transactions herein contemplated do not require,
                            under the laws of its state of organization or any
                            state in which the Target Fund is qualified to do
                            business, or the federal laws of the United States,
                            the consent, approval, authorization, registration,
                            qualification or order of, or filing with, any court
                            or governmental agency or body (except such as have
                            been obtained under the 1933 Act, 1934 Act, the 1940
                            Act or the rules and regulations thereunder).
                            Counsel need express no opinion, however, as to any
                            such consent, approval, authorization, registration,
                            qualification, order or filing


                                      A-13


<PAGE>

                           which may be required as a result of the involvement
                           of other parties to this Agreement in the
                           transactions herein contemplated because of their
                           legal or regulatory status or because of any other
                           facts specifically pertaining to them;






         (f)      That the Acquiring Fund shall have obtained an opinion from
                  Skadden, counsel for the Target Fund, dated as of the Closing
                  Date, addressed to the Acquiring Fund, that the consummation
                  of the transactions set forth in this Agreement comply with
                  the requirements of a reorganization as described in Section
                  368(a) of the Code.



         (g)      That the N-14 Registration Statement shall have become
                  effective under the 1933 Act and no stop order suspending such
                  effectiveness shall have been instituted or, to the knowledge
                  of the Target Fund, be contemplated by the SEC.



         (h)      That all proceedings taken by the Target Fund and its counsel
                  in connection with the Reorganization and all documents
                  incidental thereto shall be satisfactory in form and substance
                  to the Acquiring Fund.



         (i)      That prior to the Closing Date the Target Fund shall have
                  declared a dividend or dividends which, together with all such
                  previous dividends, shall have the effect of distributing to
                  its shareholders all of its net investment company taxable
                  income for the period to and including the Closing Date, if
                  any (computed without regard to any deduction for dividends
                  paid), and all of its net capital gain, if any, realized to
                  and including the Closing Date. In this regard, the last
                  dividend period for the Target Fund Preferred Shares may be
                  shorter than the dividend period for such APS determined as
                  set forth in the applicable Certificate of Vote.


10.      Termination, Postponement and Waivers.

         (a)      Notwithstanding anything contained in this Agreement to the
                  contrary, this Agreement may be terminated and the
                  Reorganization abandoned at any time (whether before or after
                  adoption thereof by the shareholders of the Funds) prior to
                  the Closing Date, or the Closing Date may be postponed, (i) by
                  mutual consent of the Boards of Trustees of the

                                      A-14

<PAGE>


                  Funds, (ii) by the Board of Trustees of the Target Fund if any
                  condition of the Target Fund's obligations set forth in
                  Section 8 of this Agreement has not been fulfilled or waived
                  by such Board; or (iii) by the Board of Trustees of the
                  Acquiring Fund if any condition of the Acquiring Fund's
                  obligations set forth in Section 9 of this Agreement have not
                  been fulfilled or waived by such Board.



         (b)      If the transactions contemplated by this Agreement have not
                  been consummated by December 31, 2005, this Agreement
                  automatically shall terminate on that date, unless a later
                  date is mutually agreed to by the Boards of Trustees of the
                  Funds.


         (c)      In the event of termination of this Agreement pursuant to the
                  provisions hereof, the same shall become void and have no
                  further effect, and there shall not be any liability on the
                  part of any Fund or persons who are their directors, trustees,
                  officers, agents or shareholders in respect of this Agreement.


         (d)      At any time prior to the Closing Date, any of the terms or
                  conditions of this Agreement may be waived by the Board of
                  Trustees of any Fund (whichever is entitled to the benefit
                  thereof), if, in the judgment of such Board after consultation
                  with its counsel, such action or waiver will not have a
                  material adverse effect on the benefits intended under this
                  Agreement to the shareholders of their respective fund, on
                  behalf of which such action is taken.


         (e)      The respective representations and warranties contained in
                  Sections 1 and 2 of this Agreement shall expire with, and be
                  terminated by, the consummation of the Reorganization, and
                  neither Fund nor any of its officers, trustees, agents or
                  shareholders shall have any liability with respect to such
                  representations or warranties after the Closing Date. This
                  provision shall not protect any officer, trustee, agent or
                  shareholder of either Fund against any liability to the entity
                  for which that officer, trustee, agent or shareholder so acts
                  or to its shareholders, to which that officer, trustee, agent
                  or shareholder otherwise would be subject by reason of willful
                  misfeasance, bad faith, gross negligence, or reckless
                  disregard of the duties in the conduct of such office.

         (f)      If any order or orders of the Commission with respect to this
                  Agreement shall be issued prior to the Closing Date and shall
                  impose any terms or conditions which are determined by action
                  of the Boards of Trustees of the Funds to be acceptable, such
                  terms and conditions shall be binding as if a part of this
                  Agreement without further vote or approval of the shareholders
                  of the Funds unless such terms and conditions shall result in
                  a change in the method of computing the number of Acquiring
                  Fund Common Shares or Acquiring Fund APS to be issued to the
                  Acquired Funds, as applicable, in which event, unless such
                  terms and conditions shall have been included in the proxy
                  solicitation materials furnished to the shareholders of the
                  Funds prior to the meetings at which the Reorganization shall
                  have been approved, this Agreement shall not be consummated
                  and shall terminate unless the Funds promptly shall call a
                  special meeting of shareholders at which such conditions so
                  imposed shall be submitted for approval.

11.      Indemnification.

         (a)      Each party (an "Indemnitor") shall indemnify and hold the
                  other and its officers, trustees, agents and persons
                  controlled by or controlling any of them (each an "Indemnified


                                      A-15
<PAGE>

                  Party") harmless from and against any and all losses, damages,
                  liabilities, claims, demands, judgments, settlements,
                  deficiencies, taxes, assessments, charges, costs and expenses
                  of any nature whatsoever (including reasonable attorneys'
                  fees) including amounts paid in satisfaction of judgments, in
                  compromise or as fines and penalties, and counsel fees
                  reasonably incurred by such Indemnified Party in connection
                  with the defense or disposition of any claim, action, suit or
                  other proceeding, whether civil or criminal, before any court
                  or administrative or investigative body in which such
                  Indemnified Party may be or may have been involved as a party
                  or otherwise or with which such Indemnified Party may be or
                  may have been threatened (collectively, the "Losses") arising
                  out of or related to any claim of a breach of any
                  representation, warranty or covenant made herein by the
                  Indemnitor, provided, however, that no Indemnified Party shall
                  be indemnified hereunder against any Losses arising directly
                  from such Indemnified Party's (i) willful misfeasance, (ii)
                  bad faith, (iii) gross negligence or (iv) reckless disregard
                  of the duties involved in the conduct of such Indemnified
                  Party's position.

         (b)      The Indemnified Party shall use its best efforts to minimize
                  any liabilities, damages, deficiencies, claims, judgments,
                  assessments, costs and expenses in respect of which indemnity
                  may be sought hereunder. The Indemnified Party shall give
                  written notice to Indemnitor within the earlier of ten (10)
                  days of receipt of written notice to Indemnified Party or
                  thirty (30) days from discovery by Indemnified Party of any
                  matters which may give rise to a claim for indemnification or
                  reimbursement under this Agreement. The failure to give such
                  notice shall not affect the right of Indemnified Party to
                  indemnity hereunder unless such failure has materially and
                  adversely affected the rights of the Indemnitor; provided that
                  in any event such notice shall have been given prior to the
                  expiration of the Survival Period. At any time after ten (10)
                  days from the giving of such notice, Indemnified Party may, at
                  its option, resist, settle or otherwise compromise, or pay
                  such claim unless it shall have received notice from
                  Indemnitor that Indemnitor intends, at Indemnitor's sole cost
                  and expense, to assume the defense of any such matter, in
                  which case Indemnified Party shall have the right, at no cost
                  or expense to Indemnitor, to participate in such defense. If
                  Indemnitor does not assume the defense of such matter, and in
                  any event until Indemnitor states in writing that it will
                  assume the defense, Indemnitor shall pay all costs of
                  Indemnified Party arising out of the defense until the defense
                  is assumed; provided, however, that Indemnified Party shall
                  consult with Indemnitor and obtain indemnitor's prior written
                  consent to any payment or settlement of any such claim.
                  Indemnitor shall keep Indemnified Party fully apprised at all
                  times as to the status of the defense. If Indemnitor does not
                  assume the defense, Indemnified Party shall keep Indemnitor
                  apprised at all times as to the status of the defense.
                  Following indemnification as provided for hereunder,
                  Indemnitor shall be subrogated to all rights of Indemnified
                  Party with respect to all third parties, firms or corporations
                  relating to the matter for which indemnification has been
                  made.

12.      Other Matters.






                                      A-16

<PAGE>






         (a)      All covenants, agreements, representations and warranties made
                  under this Agreement and any certificates delivered pursuant
                  to this Agreement shall be deemed to have been material and
                  relied upon by each of the parties, notwithstanding any
                  investigation made by them or on their behalf.



         (b)      All notices hereunder shall be sufficiently given for all
                  purposes hereunder if in writing and delivered personally or
                  sent by registered mail or certified mail, postage prepaid.
                  Notice to the Target Fund shall be addressed to the Target
                  Fund c/o Van Kampen Asset Management, 1221 Avenue of the
                  Americas, New York, New York 10020, Attention: General
                  Counsel, or at such other address as the Target Fund may
                  designate by written notice to the Acquiring Fund. Notice to
                  the Acquiring Fund shall be addressed to the Acquiring Fund
                  c/o Van Kampen Asset Management, 1221 Avenue of the Americas,
                  New York, New York 10020, Attention: General Counsel, or at
                  such other address and to the attention of such other person
                  as the Acquiring Fund may designate by written notice to the
                  Target Fund. Any notice shall be deemed to have been served or
                  given as of the date such notice is delivered personally or
                  mailed.



         (c)      This Agreement supersedes all previous correspondence and oral
                  communications between the parties regarding the
                  Reorganization, constitutes the only understanding with
                  respect to the Reorganization, may not be changed except by a
                  letter of agreement signed by each party and shall be governed
                  by and construed in accordance with the laws of the State of
                  Illinois applicable to agreements made and to be performed in
                  said state.



         (d)      It is expressly agreed that the obligations of the Funds
                  hereunder shall not be binding upon any of their respective
                  trustees, shareholders, nominees, officers, agents, or
                  employees personally, but shall bind only the trust property
                  of the respective Fund as provided in such Fund's Declaration
                  of Trust. The execution and delivery of this Agreement has
                  been authorized by the trustees of each Fund and signed by
                  authorized officers of each Fund, acting as such, and neither
                  such authorization by such trustees, nor such execution and
                  delivery by such officers shall be deemed to have been made by
                  any of them individually or to impose any liability on any of
                  them personally, but shall bind only the trust property of
                  each Fund as provided in such Funds' Declaration of Trust.


         This Agreement may be executed in any number of counterparts, each of
which, when executed and delivered, shall be deemed to be an original but all
such counterparts together shall constitute but one instrument.

         IN WITNESS WHEREOF, the parties have hereunto caused this Agreement to
be executed and delivered by their duly authorized officers as of the day and
year first written above.


                                      A-17

<PAGE>

                                       VAN KAMPEN XXXXXXXXXXXXX
                                       XXXXXXXXXXXXXXXXXXXXXX



                                       -----------------------------------------
                                       [Name]
                                       [Title]
Attest: [Name]
[Title]

                                       VAN KAMPEN XXXXXXXXXXXXX
                                       XXXXXXXXXXXXXXXXXXXX



                                       -----------------------------------------
                                       [Name]
                                       [Title]
Attest: [Name]
[Title]





                                      A-18
<PAGE>
                                   APPENDIX B

                      FEDERAL IDENTIFICATION NO. 36-3779776


                        THE COMMONWEALTH OF MASSACHUSETTS

                 OFFICE OF THE MASSACHUSETTS SECRETARY OF STATE
                         MICHAEL J. CONNOLLY, SECRETARY
                    ONE ASHBURTON PLACE, BOSTON, MASS. 02108

                  CERTIFICATE OF VOTE OF TRUSTEES ESTABLISHING
                         FOUR SERIES OF PREFERRED SHARES

         I, Ronald A. Nyberg, Secretary, of Van Kampen Merritt Municipal Trust
(the "Fund") located at One Parkview Plaza, Oakbrook Terrace, IL 60181, do
hereby certify that at a meeting of the trustees of the Fund held on November
13, 1991, the following vote establishing and designating four series of
preferred shares of beneficial interest and determining the relative rights and
preferences thereof was duly adopted:

         First: Pursuant to authority expressly vested in the Board of Trustees
of the Fund by Article I of its Declaration of Trust (which, as amended or
restated from time to time is, together with this Certificate of Vote, herein
called the "Declaration of Trust"), the Board of Trustees hereby authorizes the
issuance of four series of 6,000 shares of its authorized preferred shares of
beneficial interest, par value $.01 per share ("Preferred Shares"), liquidation
preference of $50,000 per share, designated, respectively, Auction Preferred
Shares, Series A ("APS Series A"), Auction Preferred Shares, Series B ("APS
Series B"), Auction Preferred Shares, Series C ("APS Series C") and Auction
Preferred Shares, Series D ("APS Series D") (collectively the APS Series A, APS
Series B, APS Series C and APS Series D are referred to herein as "APS").

         Second: The preferences, voting powers, qualifications, and special or
relative rights or privileges of each such series of preferred shares of
beneficial interest are as follows:

                                   DESIGNATION


         APS SERIES A: A series of 1,500 preferred shares of beneficial
interest, $.01 par value, liquidation preference $50,000 per share, is hereby
designated "Auction Preferred Shares, Series A" (hereinafter, "APS Series A").
Each share of APS Series A shall be issued on December 10, 1991; have an
Applicable Rate for its Initial Dividend Period equal to 4.50% per annum; have
an Initial Dividend Payment Date of January 7, 1992; and have such other
preferences, limitations and relative voting rights, in addition to those
required by applicable law or set forth in the Declaration of Trust applicable
to preferred shares of beneficial interest of the Fund, as are set forth in Part
I and Part II of this Certificate of Vote. The APS Series A shall constitute a
separate series of Preferred Shares of beneficial interest of the Fund, and each
share of APS Series A shall be identical except as provided in Section 3 of Part
I of this Certificate of Vote.



                                      B-1
<PAGE>







         APS SERIES B: A series of 1,500 preferred shares of beneficial
interest, par value $.01 per share, liquidation preference $50,000 per share, is
hereby designated "Auction Preferred Shares, Series B" (hereinafter, "APS Series
B"). Each share of APS Series B shall be issued on December 10, 1991; have an
Applicable Rate for its Initial Dividend Period equal to 4.50% per annum; have
an Initial Dividend Payment Date of January 15, 1992; and have such other
preferences, limitations and relative voting rights, in addition to those
required by applicable law or set forth in the Declaration of Trust applicable
to preferred shares of beneficial interest of the Fund, as are set forth in Part
I and Part II of this Certificate of Vote. The APS Series B shall constitute a
separate series of Preferred Shares of the Fund, and each share of APS Series B
shall be identical except as provided in Section 3 of Part I of this Certificate
of Vote.

         APS SERIES C: A series of 1,500 preferred shares of beneficial
interest, par value $.01 per share, liquidation preference $50,000 per share, is
hereby designated "Auction Preferred Shares, Series C" (hereinafter, "APS Series
C"). Each share of APS Series C shall be issued on December 10, 1991; have an
Applicable Rate for its Initial Dividend Period equal to 4.50% per annum; have
an Initial Dividend Payment Date of January 9, 1992; and have such other
preferences, limitations and relative voting rights, in addition to those
required by applicable law or set forth in the Declaration of Trust applicable
to preferred shares of beneficial interest of the Fund, as are set forth in Part
I and Part II of this Certificate of Vote. The APS Series C shall constitute a
separate series of Preferred Shares of the Fund, and each share of APS Series C
shall be identical except as provided in Section 3 of Part I of this Certificate
of Vote.

         APS SERIES D: A series of 1,500 preferred shares of beneficial
interest, par value $.01 per share, liquidation preference $50,000 per share, is
hereby designated "Auction Preferred Shares, Series D." Each share of APS Series
D shall be issued on December 10, 1991; have an Applicable Rate for its Initial
Dividend Period equal to 4.50% per annum; have an Initial Dividend Payment Date
of January 10, 1992; and have such other preferences, limitations and relative
voting rights, in addition to those required by applicable law or set forth in
the Declaration of Trust applicable to preferred shares of beneficial interest
of the Fund, as are set forth in Part I and Part II of this Certificate of Vote.
The APS Series D shall constitute a separate series of Preferred Shares of the
Fund, and each share of APS Series D shall be identical except as provided in
Section 3 of Part I of this Certificate of Vote.

         No holder of any series of APS shall have, solely by reason of being
such a holder of any series of APS, any right to acquire, purchase or subscribe
for any APS, common shares of beneficial interest, par value $.01 per share, of
the Fund or other securities of the Fund which it may hereafter issue or sell
(whether out of the number of shares authorized by the Declaration of Trust, or
out of any shares acquired by the Fund after the issuance thereof, or
otherwise).

                                   ARTICLE I.

                  Number of Shares; Ranking. (a) No fractional APS shall be
issued.

                  2. Any APS which at any time have been redeemed or purchased
by the Fund shall, after such redemption or purchase, have the status of
authorized but unissued Preferred Shares, without designation as to series.

         The shares of each series of APS shall rank on a parity with shares of
any other series of Preferred Shares (including any other series of APS) as to
the payment of dividends and the distribution of assets upon dissolution,
liquidation or winding up of the affairs of the Fund.

                  Dividends. (a) The Holder of shares of any series of APS shall
be entitled to receive, when, as and if declared by the Board of Trustees, out
of funds legally available therefor, cumulative cash dividends at the Applicable
Rate per annum thereof, determined as set forth in paragraph (c) of this


                                      B-2

<PAGE>


Section 2, and no more (except to the extent set forth in Section 12 of this
Part I), payable on the respective dates (each a "Dividend Payment Date")
determined as set forth in paragraph (b) of this Section 2. Dividends on shares
of any series of APS shall accumulate at the Applicable Rate per annum from the
Date of Original Issue thereof.

         (i) Dividends shall be payable subject to subparagraph (b) (ii) of this
Section 2, on shares of:

                  (i) APS Series A, on Tuesday, January 7, 1992, and on each
         Tuesday thereafter,

                  (ii) APS Series B, on Wednesday, January 15, 1992, and on each
         fourth Wednesday thereafter,

                  (iii) APS Series C, on Thursday, January 9, 1992, and on each
         Thursday thereafter, and

                  (iv) APS Series D, on Friday, January 10, 1992, and on each
         fourth Friday thereafter,

provided that if the Fund, subject to the conditions set forth in Section 4 of
this Part I, designates any Subsequent Dividend Period as a Special Dividend
Period, dividends will be payable: (1) with respect to a Special Dividend Period
of less than 91 days, the day after the last day thereof, (2) with respect to a
Special Dividend Period of 91 days or more and fewer than 365 days, the 92nd day
thereof, the 183rd day thereof, if any, the 247th day thereof, if any, and the
day after the last day, thereof and (3) with respect to a Special Dividend
Period of 365 or more days, on such date in each quarterly period after the
commencement thereof as is determined by the Board of Trustees.

After any Special Dividend Period, dividends on shares of such series of APS
shall be payable, subject to subparagraph (b)(ii) of this Section 2, on each
succeeding Tuesday if such series is APS Series A, each fourth succeeding
Wednesday if such series is APS Series B, each succeeding Thursday if such
series is APS Series C, and each fourth succeeding Friday if such series is APS
Series D, subject in each case to the options of the Fund to further designate
from time to time any Subsequent Dividend Period thereof as a Special Dividend
Period.

         In the case of dividends that would be payable on a Monday, Tuesday,
Wednesday, Thursday or Friday as determined by subparagraph (b) (i) of this
Section 2, including clause (1), (2) or (3) of the proviso thereto, if (i) the
Monday or Tuesday that would otherwise be the Dividend Payment Date is not a
Business Day, then dividends shall be payable on the first Business Day that
falls after such Monday or Tuesday, or (ii) the Wednesday, Thursday or Friday
that would otherwise be the Dividend Payment Date is not a Business Day, then
dividends shall be payable on the first Business Day that falls prior to such
Wednesday, Thursday or Friday.

         The Fund shall pay to the Auction Agent not later than 12:00 Noon, New
York City time, on the Business Day next preceding each Dividend Payment Date
for shares of such series, an aggregate amount of funds available on the next
Business Day in The City of New York, New York, equal to the dividends to be
paid to all Holders of shares of such series on such Dividend Payment Date.

         All moneys paid to the Auction Agent for the payment of dividends (or
for the payment of any late charges pursuant to subparagraph (c)(i) of this
Section 2) shall be held in trust for the payment of such dividends (and any
such late charge) by the Auction Agent for the benefit of the




                                      B-3
<PAGE>


Holders specified in subparagraph (b)(v) of this Section 2. Any moneys paid to
the Auction Agent in accordance with the foregoing but not applied by the
Auction Agent to the payment of dividends (and any late charge) will, to the
extent permitted by law, be repaid to the Fund at the end of 90 days from the
date on which such moneys were so to have been applied.

         Each dividend on the APS shall be paid on the Dividend Payment Date
therefor to the Holders as their names appear on the share books of the Fund on
the Business Day next preceding such Dividend Payment Date. Dividends in arrears
for any past Dividend Period may be declared and paid at any time, without
reference to any regular Dividend Payment Date, to the Holders as their names
appear on the share books of the Fund on such date, not exceeding 15 days
preceding the payment date thereof, as may be fixed by the Board of Trustees.

                  1. (i) The dividend rate on shares of any series of APS during
the period from and after the Date of Original Issue thereof to and including
the last day of the Initial Dividend Period therefor shall be equal to the rate
per annum set forth with respect to such series under "Designation," above. For
each Subsequent Dividend Period of any series of APS outstanding thereafter, the
dividend rate on shares of such series shall be equal to the rate per annum that
results from an Auction for such series on the Auction Date next preceding such
Subsequent Dividend Period; provided, however, that if an Auction for any
Subsequent Dividend Period of any series of APS is not held for any reason or if
a Failure to Deposit occurs and such failure has not been cured as set forth
below prior to any succeeding Subsequent Dividend Period thereof, then, subject
to the next succeeding provision, the dividend rate on the shares of such series
for any such Subsequent Dividend Period shall be the Maximum Rate (as defined
herein) for such series on the Auction Date for such Subsequent Dividend Period;
provided, further, however, that if (A) any Failure to Deposit shall have
occurred with respect to shares of any series of APS during any Rate Period
thereof (other than any Special Dividend Period consisting of four or more
Dividend Periods or any Rate Period succeeding any Special Dividend Period
consisting of four or more Dividend Periods during which a Failure to Deposit
occurred that has not been cured), and prior to 12:00 noon, New York City time,
on the third Business Day next succeeding the date on which such Failure to
Deposit occurred, such Failure to Deposit shall not have been cured in
accordance with the next succeeding sentence or the Fund shall not have paid to
the Auction Agent a late charge equal to the sum of (1) if such Failure to
Deposit consisted of the failure timely to pay to the Auction Agent the full
amount of dividends with respect to any Dividend Period on the shares of such
series, an amount computed by multiplying (x) 200% of the "AA" Composite
Commercial Paper Rate for the Rate Period during which such Failure to Deposit
occurs on the Dividend Payment Date for such Dividend Period by (y) a fraction,
the numerator of which shall be the number of days for which such Failure to
Deposit has not been cured in accordance with the next succeeding sentence
(including the day such Failure to Deposit occurs and excluding the day such
Failure to Deposit is cured) and the denominator of which shall be 365, and
applying the rate obtained against the aggregate liquidation preference of the
outstanding shares of such series of APS and (2) if such Failure to Deposit
consisted of the failure timely to pay to the Auction Agent the Redemption Price
of the shares of such series of APS, if any, for which Notice of Redemption has
been given by the Fund pursuant to paragraph (b) of Section 3 of this Part I, an
amount computed by multiplying (x) 200% of the "AA" Composite Commercial Paper
Rate for the Rate Period during which such Failure to Deposit occurs on the
redemption date by (y) a fraction, the numerator of which shall be the number of
days for which such Failure to Deposit is not cured in accordance with the next
succeeding sentence (including the day such Failure to Deposit occurs and
excluding the day such Failure to Deposit is cured) and the denominator of which
shall be 365, and applying the rate obtained against the aggregate liquidation
preference of the outstanding shares of APS to be redeemed, or (B) any Failure
to Deposit shall have occurred with respect to shares of any series of APS
during a Special Dividend Period thereof consisting of four or more Dividend
Periods, or during any Rate Period thereof succeeding any Special Dividend
Period consisting of four or more Dividend Periods during which a Failure to
Deposit occurred that has not been cured, and such Failure to Deposit shall not
have been cured in accordance with the next



                                      B-4
<PAGE>


succeeding sentence during such Special Dividend Period or such other Rate
Period, then the dividend rate for shares of such series of APS for each
Subsequent Dividend Period thereof commencing after such failure to and
including the Subsequent Dividend Period, if any, during which such Failure to
Deposit is so cured shall be a rate per annum equal to the Maximum Rate on the
Auction Date for such Subsequent Dividend Period (but with the prevailing rating
for such shares, for purposes of determining such Maximum Rate, being deemed to
be "Below "ba3"/BB-") (the rate per annum at which dividends are payable on the
APS for any Rate Period for such shares being herein referred to as the
"Applicable Rate" for such shares). A Failure to Deposit with respect to shares
of any series of APS shall have been cured (if such Failure to Deposit is not
solely due to the willful failure of the Fund to make the required payment to
the Auction Agent) with respect to any Rate Period if, not later than 12:00
Noon, New York City time, on the fourth Business Day preceding the Auction Date
for the Rate Period subsequent to such Rate Period the Fund shall have paid to
the Auction Agent (A) all accumulated and unpaid dividends on the shares of such
series of APS and (B) without duplication, the Redemption Price for the APS, if
any, for which Notice of Redemption has been given by the Fund pursuant to
paragraph (b) of Section 3 of this Part 1.

                  (b) The amount of dividends per share payable on shares of any
         series of APS on any date on which dividends shall be payable on shares
         of such series shall be computed by multiplying the respective
         Applicable Rate for such series in effect for such Dividend Period or
         Dividend Periods or part thereof for which dividends have not been paid
         by a fraction, the numerator of which shall be the number of days in
         such Dividend Period or Dividend Periods or part thereof and the
         denominator of which shall be 365 if such Dividend Period is a Rate
         Period, or is contained in a Rate Period, of less than one year and 360
         for all other Dividend Periods, and applying the rate obtained against
         $50,000.

                  3. Any dividend payment made on the APS shall first be
credited against the earliest accumulated but unpaid dividends due with respect
to such APS.


         Except as set forth in the next sentence, no dividends shall be
declared or paid or set apart for payment on the shares of any class or series
of shares ranking, as to the payment of dividends, on a parity with the APS for
any period unless full cumulative dividends have been or contemporaneously are
declared and paid on the shares of each series of APS through the most recent
Dividend Payment Date for each such series. When dividends are not paid in full
upon the APS through their most recent respective Dividend Payment Dates or upon
the shares of any other class or series of shares ranking on a parity as to the
payment of dividends with the APS through their most recent respective dividend
payment dates, all dividends declared upon the APS and any other such class or
series of shares ranking on a parity as to the payment of dividends with the APS
shall be declared pro rata so that the amount of dividends declared per share on
the APS and such other class or series of shares shall in all cases bear to each
other the same ratio that accumulated dividends per share on the APS and such
other class or series of shares bear to each other (for purposes of this
sentence, the amount of dividends declared per share shall be based on the
Applicable Rate for such shares for the Dividend Periods during which dividends
were not paid in full). Holders of the APS shall not be entitled to any
dividend, whether payable in cash, property or shares, in excess of full
cumulative dividends, as herein provided, on the APS. No interest, or sum of
money in lieu of interest, shall be payable in respect of any dividend payment
or payments on the APS which may be in arrears, and, except to the extent set
forth in subsection (c)(i) of this Section 2, no additional sum of money shall
be payable in respect of any such arrearage.

         Dividends on the APS shall be designated as exempt-interest dividends
up to the amount of tax-exempt income of the Fund, to the extent permitted by,
and for purposes of, Section 852 of the Internal Revenue Code of 1986, as
amended from time to time.


                                      B-5
<PAGE>


         The Board of Trustees shall not declare any dividend (except a dividend
payable in Common Shares), or declare any other distribution, upon the Common
Shares, or purchase Common Shares, unless in every such case the APS have, at
the time of any such declaration or purchase, an asset coverage (as defined in
and determined pursuant to the 1940 Act) of at least 200% (or such other asset
coverage as may in the future be specified in or under the 1940 Act as the
minimum asset coverage for senior securities which are stock of a closed-end
investment company as a condition of declaring dividends on its common stock)
after deducting the amount of such dividend, distribution or purchase price, as
the case may be.

         A.       Redemption. (a)(i) Upon giving a Notice of Redemption, as
                  provided below, the Fund at its option may redeem shares of
                  any series of APS, in whole or in part, on the Second Business
                  Day next preceding any Dividend Payment Date applicable to
                  those shares of APS called for redemption, out of funds
                  legally available therefor, at the Optional Redemption Price;
                  provided that during a Special Dividend Period of 365 days or
                  more no share of APS will be subject to optional redemption
                  during any Non-Call Period; provided, that shares of any
                  series of APS may not be redeemed in part if after such
                  partial redemption fewer than 250 shares of such series remain
                  outstanding.

         If fewer than all of the outstanding shares of any series of APS are to
be redeemed pursuant to subparagraph (a)(i) of this Section 3, the number of
shares of such series to be redeemed shall be determined by the Board of
Trustees, and such shares shall be redeemed pro rata from the Holders of such
series in proportion to the number of such shares held by such Holders.

         No APS shall be redeemed pursuant to subparagraphs (a)(i) or (a)(ii) of
this Section 3 unless, on the date on which the Fund intends to give notice of
such redemption pursuant to paragraph (b) of this Section 3, (a) the Fund has
available Deposit Securities with maturity or tender dates not later than the
day preceding the applicable redemption date and having a value not less than
the amount (including the applicable premium, if any) due to Holders of the APS
by reason of the redemption of such shares on such redemption date and (b)
Moody's Eligible Assets (if Moody's is then rating the APS) and S&P Eligible
Assets (if S&P is then rating the APS) each at least equal the APS Basic
Maintenance Amount, and would at least equal the APS Basic Maintenance Amount
immediately subsequent to such redemption if such redemption were to occur on
such date.

         The Fund shall redeem, at the Mandatory Redemption Price, certain of
the APS to the extent permitted under the 1940 Act and Massachusetts law, if the
Fund fails to maintain the APS Basic Maintenance Amount or 1940 Act APS Asset
Coverage in accordance with the requirements of the rating agency or agencies
then rating the APS and such failure is not cured on or before the APS Basic
Maintenance Cure Date or the 1940 Act Cure Date, as the case may be. The number
of APS to be redeemed shall be equal to the lesser of (i) the minimum number of
APS the redemption of which, if deemed to have occurred immediately prior to the
opening of business on the Cure Date, together with all other Preferred Shares
subject to redemption or retirement, would result in the satisfaction of the APS
Basic Maintenance Amount or the 1940 Act APS Asset Coverage, as the case may be,
on such Cure Date (provided that, if there is no such minimum number of APS and
other Preferred Shares the redemption of which would have such result, all the
APS and Preferred Shares then outstanding shall be redeemed), and (ii) the
maximum number of APS, together with all other Preferred Shares subject to
redemption or retirement, that can be redeemed out of funds expected to be
legally available therefor. In determining the APS required to be redeemed in
accordance with the foregoing, the Fund shall allocate the number required to be
redeemed to satisfy the APS Basic Maintenance Amount or the 1940 Act APS Asset
Coverage, as the case may be, pro rata among each series of APS and other
Preferred Shares subject to redemption provisions similar to those contained in
this subparagraph (a)(iv) of this




                                      B-6
<PAGE>


Section 3. The Fund shall effect such redemption not earlier than 20 days and
not later than 40 days after such Cure Date, except that if the Fund does not
have funds legally available for the redemption of all of the required number of
APS and other Preferred Shares which are subject to redemption provisions
similar to those contained in this subparagraph (a)(iv) of this Section 3 or the
Fund otherwise is unable to effect such redemption on or prior to 40 days after
such Cure Date, the Fund shall redeem those APS and other Preferred Shares which
it was unable to redeem on the earliest practicable date on which it is able to
effect such redemption. If fewer than all of the outstanding shares of any
series of APS are to be redeemed pursuant to this Section 3(a)(iv), the number
of shares of such series to be redeemed shall be redeemed pro rata from the
Holders of such shares in proportion to the number of shares held by such
Holders.

                  2. The Fund is required to give 30 days Notice of Redemption.
In the event the Fund obtains appropriate exemptive or no-action relief from the
Securities and Exchange Commission, the number of days' notice required for a
mandatory redemption may be reduced by the Board of Trustees of the Fund to as
few as two Business Days if Moody's and S&P each has agreed in writing that the
revised notice provision would not adversely affect its then-current ratings of
the APS. The Auction Agent will use its reasonable efforts to provide telephonic
notice to each holder of APS called for redemption not later than the close of
business on the Business Day on which the Auction Agent determines the shares to
be redeemed (as described above) (or, during the occurrence of a Failure to
Deposit with respect to such shares, not later than the close of business on the
Business Day immediately following the day on which the Auction Agent receives
Notice of Redemption from the Fund). Such telephonic notice will be confirmed
promptly in writing not later than the close of business on the third Business
Day preceding the redemption date by notice sent by the Auction Agent to each
holder of record of APS called for redemption, the Broker-Dealers and the
Securities Depository. Every Notice of Redemption and other redemption notice
with respect to APS will state: (1) the redemption date, (2) the number of APS
to be redeemed, (3) the redemption price, (4) that dividends on the APS to be
redeemed will cease to accumulate as of such redemption date and (5) the
provision of the APS Provisions pursuant to which such shares are being
redeemed. No defect in the Notice of Redemption or other redemption notice or in
the transmittal or the mailing thereof will affect the validity of the
redemption proceedings, except as required by applicable law. If fewer than all
shares of any series held by any Holder are to be redeemed, the Notice of
Redemption mailed to such Holder shall also specify the number of shares of such
series to be redeemed from such Holder.

                  3. Notwithstanding the provisions of paragraph (a) of this
Section 3, if any dividends on shares of any series of APS are in arrears, no
shares of such series of APS shall be redeemed unless all outstanding shares of
such series of APS are simultaneously redeemed, and the Fund shall not purchase
or otherwise acquire any shares of such series of APS; provided, however, that
the foregoing shall not prevent the purchase or acquisition of all outstanding
shares of such series of APS pursuant to the successful completion of an
otherwise lawful purchase or exchange offer made on the same terms to, and
accepted by, Holders of all outstanding shares of such series of APS.

                  4. Upon the deposit of funds sufficient to redeem the APS with
the Auction Agent and the giving of Notice of Redemption under Paragraph (b) of
this Section 3, dividends on such shares shall cease to accumulate and such
shares shall no longer be deemed to be outstanding for any purpose, and all
rights of the Holders of the shares so called for redemption shall cease and
terminate, except the right of such Holders to receive the Optional Redemption
Price or Mandatory Redemption Price, as the case may be, but without any
interest or other additional amount, except as provided in Section 2(c)(i) and
in Section 12. Upon surrender in accordance with the Notice of Redemption of the
certificates for any shares so redeemed (properly endorsed or assigned for
transfer, if the Board of Trustees shall so require and the Notice of Redemption
shall so state), the Optional Redemption Price or Mandatory Redemption Price, as
the case may be, shall be paid by the Auction Agent to the Holders of the APS
subject to redemption. In



                                      B-7
<PAGE>



the case that fewer than all of the shares represented by any such certificate
are redeemed, a new certificate shall be issued, representing the unredeemed
shares, without cost to the Holder thereof. The Fund shall be entitled to
receive from the Auction Agent, promptly after the date fixed for redemption,
any cash deposited with the Auction Agent in excess of (i) the aggregate
Optional Redemption Price of the APS called for redemption on such date and (ii)
all other amounts to which Holders of the APS called for redemption may be
entitled. Any funds so deposited that are unclaimed at the end of 90 days from
such redemption date shall, to the extent permitted by law, be repaid to the
Fund, after which time the Holders of the APS so called for redemption may look
only to the Fund for payment of the Optional Redemption Price or Mandatory
Redemption Price, as the case may be, and all other amounts to which they may be
entitled. The Fund shall be entitled to receive, from time to time after the
date fixed for redemption, any interest on the funds so deposited.

                  5. To the extent that any redemption for which Notice of
Redemption has been given is not made by reason of the absence of legally
available funds therefor, such redemption shall be made as soon as practicable
to the extent such funds become available. Failure to redeem the APS shall be
deemed to exist at any time after the date specified for redemption in a Notice
of Redemption when the Fund shall have failed, for any reason whatsoever, to
deposit in trust with the Auction Agent the Redemption Price with respect to any
shares for which such Notice of Redemption has been given. Notwithstanding the
fact that the Fund may not have redeemed the APS for which a Notice of
Redemption has been given, dividends may be declared and paid on the APS and
shall include those APS for which a Notice of Redemption has been given.

                  6. All moneys paid to the Auction Agent for payment of the
Optional Redemption Price or Mandatory Redemption Price, as the case may be, of
the APS called for redemption shall be held in trust by the Auction Agent for
the benefit of Holders of shares so to be redeemed.

                  7. In effecting any redemption pursuant to this Section 3, the
Fund shall use its best efforts to comply with all applicable procedural
conditions precedent to effecting such redemption under the 1940 Act and
Massachusetts law, but shall effect no redemption except in accordance with the
1940 Act and Massachusetts law.

                  8. In the case of any redemption pursuant to this Section 3,
only whole APS shall be redeemed, and in the event that any provision of the
Declaration of Trust would require redemption of a fractional share, the Auction
Agent shall be authorized to round up so that only whole shares are redeemed.

         B.       Designation of Special Dividend Periods. (a) The Fund, at its
                  option, may designate any succeeding Subsequent Dividend
                  Period of any series of APS as a Special Dividend Period;
                  provided, however, that such designation shall be effective
                  only if (A) notice thereof shall have been given in accordance
                  with paragraph (b) and clause (i) of paragraph (c) of this
                  Section 4, (B) any Failure to Deposit that shall have occurred
                  with respect to shares of such series during any Dividend
                  Period shall have been cured in accordance with the provisions
                  of the third sentence of paragraph (c)(i) of Section 2 of this
                  Part I, (C) Sufficient Clearing Bids (as defined in Section 1
                  of Part II hereof) for such series shall have existed in an
                  Auction held on the Auction Date immediately preceding the
                  first day of such proposed Special Dividend Period, (D) if any
                  Notice of Redemption shall have been mailed by the Fund
                  pursuant to paragraph (b) of Section 3 of this Part I with
                  respect to any shares of such series of APS, the Redemption
                  Price with respect to such shares shall have been deposited
                  with the Auction Agent and (E) in the event the Fund wishes to
                  designate any succeeding Subsequent Dividend Period for such
                  series as a Special Dividend Period consisting of more than 28
                  Rate Period Days, the Fund has



                                      B-8
<PAGE>





                  received written confirmation from S&P (if S&P is then rating
                  the APS) and Moody's (if Moody's is then rating the APS) that
                  such designation would not affect the rating then assigned by
                  S&P and Moody's to such series.

                  2. If the Fund proposes to designate any succeeding Subsequent
Dividend Period of any series of APS as a Special Dividend Period pursuant to
paragraph (a) of this Section 4, not less than 20 nor more than 30 days prior to
the date the Fund proposes to designate as the first day of such Special
Dividend Period (which shall be such day that would otherwise be the first day
of a Minimum Dividend Period), notice shall be (i) published or caused to be
published by the Fund in a newspaper of general circulation to the financial
community in The City of New York, New York, which carries financial news, and
(ii) communicated by the Fund by telephonic or other means to the Auction Agent
and confirmed in writing promptly thereafter. Each such notice shall state (A)
that the Fund may exercise its option to designate a succeeding Subsequent
Dividend Period of such series of APS as a Special Dividend Period, specifying
the first day thereof and (B) that the Fund will by 11:00 A.M., New York City
time, on the second Business Day next preceding such date notify the Auction
Agent of either (x) its determination, subject to certain conditions, to
exercise such option, in which case the Fund shall specify the Special Dividend
Period designated and the terms of the Specific Redemption Provisions, if any,
or (y) its determination not to exercise such option.

                  3. No later than 11:00 A.M., New York City time, on the second
Business Day next preceding the first day of any proposed Special Dividend
Period as to which notice has been given as set forth in paragraph (b) of this
Section 4, the Fund shall deliver to the Auction Agent either:

                           (a) a notice stating (A) that the Fund has determined
         to designate the next succeeding Dividend Period of such series as a
         Special Dividend Period, specifying the same and the first day thereof,
         (B) the Auction Date immediately prior to the first day of such Special
         Dividend Period, (C) the terms of the Specific Redemption Provisions,
         if any, for such series, (D) that such Special Dividend Period shall
         not commence if (1) on such Auction Date Sufficient Clearing Bids for
         such series shall not exist or (2) a Failure to Deposit shall have
         occurred prior to the first day of such Special Dividend Period with
         respect to shares of such series and (E) the scheduled Dividend Payment
         Dates for such series of APS during such Special Dividend Period; such
         notice to be accompanied by an APS Basic Maintenance Report showing
         that, as of the third Business Day next preceding such proposed Special
         Dividend Period, (1) Moody's Eligible Assets, assuming for the purposes
         calculating Moody's Eligible Assets, in connection with an APS Basic
         Maintenance Report required to be prepared pursuant to this Section
         4(c)(i), a Moody's Exposure Period of "eight weeks or less but greater
         than seven weeks" (if Moody's is then rating such series) and (2) S&P
         Eligible Assets (if S&P is then rating such series) each at least equal
         the APS Basic Maintenance Amount as of such Business Day (assuming for
         purposes of the foregoing calculation that the Maximum Rate is the
         Maximum Rate on such Business Day as if such Business Day were the
         Auction Date for the proposed Special Dividend Period); or

                           (b) a notice stating that the Fund has determined not
         to exercise its option to designate a Special Dividend Period for such
         series of APS and that the next succeeding Dividend Period of such
         series shall be a Minimum Dividend Period.

If the Fund fails to deliver either such notice (and, in the case of the notice
described in clause (i) of the preceding sentence, an APS Basic Maintenance
Report to the effect set forth in clause (i) (if either Moody's or S&P is then
rating shares of the series in question)) with respect to any designation of any
proposed Special Dividend Period to the Auction Agent by 11:00 A.M., New York
City time, on the


                                      B-9
<PAGE>


second Business Day next preceding the first day of such proposed Special
Dividend Period, the Fund shall be deemed to have delivered a notice to the
Auction Agent with respect to such Special Dividend Period to the effect set
forth in clause (ii) of the preceding sentence.

         Voting Rights. (a) Except as otherwise provided in the Declaration of
Trust or as otherwise required by law, (i) each Holder of APS shall be entitled
to one vote for each of the APS held on each matter submitted to a vote of
shareholders of the Fund, and (ii) the holders of outstanding Preferred Shares,
including APS, and of Common Shares shall vote together as a single class;
provided that, at a meeting of the shareholders of the Fund held for the
election of the trustees, the holders of outstanding Preferred Shares, including
APS, represented in person or by proxy at said meeting, shall elect two trustees
of the Fund, each Preferred Share, including each of the APS, entitling the
holder thereof to one vote. Subject to paragraph (b) of this Section 5, the
holders of outstanding Common Shares shall elect the balance of the trustees.

         2. During any period in which any one or more of the conditions
described below shall exist (such period being referred to herein as a "Voting
Period"), the number of trustees constituting the Board of Trustees shall be
automatically increased by the smallest number that, when added to the two
trustees elected exclusively by the holders of Preferred Shares, including APS,
would constitute a majority of the Board of Trustees as so increased by such
smallest number, and the holders of Preferred Shares, including APS, shall be
entitled, voting as a class on a one-vote-per-share basis (to the exclusion of
the holders of all other securities and class of capital shares of the Fund), to
elect such smallest number of additional trustees, together with the two
trustees that such holders are in any event entitled to elect. A Voting Period
shall commence:

                           (a) if at the close of business on any Dividend
         Payment Date accumulated dividends (whether or not earned or declared)
         on any outstanding APS equal to at least two full years' dividends
         shall be due and unpaid and sufficient cash or specified securities
         shall not have been deposited with the Auction Agent for the payment of
         such accumulated dividends; or

     if at any time holders of any other Preferred Shares are entitled under the
1940 Act to elect a majority of the trustees of the Fund.

Upon the termination of a Voting Period, the voting rights described in this
paragraph (b) of Section 5 shall cease, subject always, however, to the
revesting of such voting rights in the Holders upon the further occurrence of
any of the events described in this paragraph (b) of Section 5.

     (i) As soon as practicable after the accrual of any right of the holders of
Preferred Shares to elect additional trustees as described in paragraph (b) of
this Section 5, the Fund shall notify the Auction Agent and the Auction Agent
shall call a special meeting of such holders, by mailing a notice of such
special meeting to such holders, such meeting to be held not less than 10 nor
more than 20 days after the date of mailing of such notice. If the Fund fails to
send such notice to the Auction Agent or if the Auction Agent does not call such
a special meeting, it may be called by any such holder on like notice. The
record date for determining the holders entitled to notice of and to vote at
such special meeting shall be the close of business on the fifth Business Day
preceding the day on which such notice is mailed. At any such special meeting
and at each meeting of holders of Preferred Shares held during a Voting Period
at which trustees are to be elected, such holders, voting together as a class
(to the exclusion of the holders of all other securities and classes of capital
shares of the Fund), shall be entitled to elect the number of trustees
prescribed in paragraph (b) of this Section 5 on a one-vote-per-share basis.


                                      B-10
<PAGE>
     For purposes of determining any rights of the Holders to vote on any
matter, whether such right is created by this Certificate of Vote, by the other
provisions of the Declaration of Trust, by statute or otherwise, no Holder shall
be entitled to vote and no APS shall be deemed to be "outstanding" for the
purpose of voting or determining the number of shares required to constitute a
quorum if, prior to or concurrently with the time of determination of shares
entitled to vote or shares deemed outstanding for quorum purposes, as the case
may be, the Redemption Price for the redemption of such shares has been
deposited in trust with the Auction Agent for that purpose and the requisite
Notice of Redemption with respect to such shares shall have been given as
provided in Section 3 of this Part I. None of the APS held by the Fund or any
affiliate of the Fund shall have any voting rights or be deemed to be
outstanding for voting or other purposes.

     The terms of office of all persons who are Trustees of the Fund at the time
of a special meeting of Holders and holders of other Preferred Shares to elect
trustees shall continue, notwithstanding the election at such meeting by the
Holders and such other holders of the number of trustees that they are entitled
to elect, and the persons so elected by the Holders and such other holders,
together with the two incumbent trustees elected by the Holders and such other
holders of Preferred Shares and the remaining incumbent trustees elected by the
holders of the Common Shares, shall constitute the duly elected trustees of the
Fund.

     Simultaneously with the termination of a Voting Period, the terms of office
of the additional trustees elected by the Holders and holders of other Preferred
Shares pursuant to paragraph (b) of this Section 5 shall terminate, the
remaining trustees shall constitute the trustees of the Fund and the voting
rights of the Holders and such other holders to elect additional trustees
pursuant to paragraph (b) of this Section 5 shall cease, subject to the
provisions of the last sentence of paragraph (b) of this Section 5.

     (i) So long as any of the APS are outstanding, the Fund shall not, without
the affirmative vote of the Holders of the Outstanding APS determined with
reference to a "majority of outstanding voting securities" as that term is
defined in Section 2(a)(49) of the 1940 Act (voting separately as one class):
(a) authorize, create or issue any class or series of shares of beneficial
interest ranking prior to or on a parity with the APS with respect to the
payment of dividends or the distribution of assets upon dissolution, liquidation
or winding up of the affairs of the Fund, or increase the authorized amount of
any series of APS (except that, notwithstanding the foregoing, but subject to
the provisions of Section 13, the Board of Trustees, without the vote or consent
of the Holders of APS, may from time to time authorize and create, and the Fund
may from time to time issue, classes or series of Preferred Shares, including
APS, ranking on a parity with the APS with respect to the payment of dividends
and the distribution of assets upon dissolution, liquidation or winding up of
the affairs of the Fund, subject to continuing compliance by the Fund with 1940
Act APS Asset Coverage and APS Basic Maintenance Amount requirements, provided
that the Fund obtains written confirmation from Moody's (if Moody's is then
rating APS) and S&P (if S&P is then rating APS) that the issuance of such class
or series would not impair the rating then assigned by such rating agency to the
APS, (b) amend, alter or repeal the provisions of the Declaration of Trust,
including this Certificate of Vote, whether by merger, consolidation or
otherwise, so as to affect any preference, right or power of such APS or the
Holders thereof; provided that (i) none of the actions permitted by the
exception to (a) above will be deemed to affect such preferences, rights or
powers and (ii) the authorization, creation and issuance of classes or series of
shares ranking junior to the APS with respect to the payment of dividends and
the distribution of assets upon dissolution, liquidation or winding up of the
affairs of the Fund, will be deemed to affect such preferences, rights or powers
only if Moody's or S&P is then rating the APS and such issuance would, at the
time thereof, cause the Fund not to satisfy the 1940 Act APS Asset Coverage or
the APS Basic Maintenance Amount, or (c) file a voluntary application for relief
under Federal bankruptcy law or any similar application under state law for so
long as the Fund is solvent and does not foresee becoming insolvent.


                                      B-11
<PAGE>







     (a) The Board of Trustees, without the vote or consent of the Holders of
APS, may from time to time amend, alter or repeal any or all of the definitions
of the terms listed below, and any such amendment, alteration or repeal will not
be deemed to affect the preferences, rights or powers of the APS or the Holders
thereof, provided the Board of Trustees receives written confirmation from
Moody's (such confirmation being required to be obtained only in the event
Moody's is rating the APS and in no event being required to be obtained in the
case of the definitions of Deposit Securities, Discounted Value and Receivables
for Municipal Securities Sold as such terms apply to S&P Eligible Assets,
Dividend Coverage Amount, Dividend Coverage Assets, Minimum Liquidity Level, S&P
Discount Factor, S&P Eligible Assets, S&P Exposure Period and Valuation Date as
such term applies to the definitions of Dividend Coverage Amount, Dividend
Coverage Assets and Minimum Liquidity Level) and S&P (such confirmation being
required to be obtained only in the event S&P is rating the APS and in no event
being required to be obtained in the case of the definitions of Discounted Value
and Receivables for Municipal Securities Sold as such terms apply to Moody's
Eligible Assets, Moody's Discount Factor, Moody's Eligible Asset and Moody's
Exposure Period) that any such amendment, alteration or repeal would not impair
the ratings then assigned by Moody's or S&P, as the case may be, to the APS:

APS Basic
Maintenance Amount
APS Basic
Maintenance Cure Date
APS Basic
Maintenance Report
Deposit Securities
Discounted Value
Dividend Coverage Amount
Dividend Coverage Assets
Market Value
Maximum Potential
Gross-up
Payment Liability
Minimum Liquidity Level
Moody's Discount Factor
Moody's Eligible
Asset Moody's Exposure Period
1940 Act Cure Date
1940 Act APS
Asset Coverage
Quarterly Valuation Date
Receivables for Municipal
Securities Sold
S&P Discount Factor
S&P Eligible Asset
S&P Exposure Period
Valuation Date

     Unless otherwise required by law, the Holders of the APS shall not have any
relative rights or preferences or other special rights other than those
specifically set forth herein. The Holders of the APS shall have no preemptive
rights or rights to cumulative voting. In the event that the Fund fails to pay
any



                                      B-12
<PAGE>


dividends on the APS, the exclusive remedy of the Holders shall be the right to
vote for trustees pursuant to the provisions of this Section 5.

     Unless a higher percentage is provided for in the Declaration of Trust, the
affirmative vote of the Holders of a majority of the outstanding APS, voting as
a separate class, shall be required to approve any plan of reorganization (as
such term is used in the 1940 Act) adversely affecting such shares or any action
requiring a vote of security holders of the Fund under Section 13(a) of the 1940
Act. In the event a vote of Holders of APS is required pursuant to the
provisions of Section 13(a) of the 1940 Act, the Fund shall, not later than ten
Business Days prior to the date on which such vote is to be taken, notify
Moody's (if Moody's is then rating the APS) and S&P (if S&P is then rating the
APS) that such vote is to be taken and the nature of the action with respect to
which such vote is to be taken. In addition, the Fund shall notify Moody's (if
Moody's is then rating the APS) and S&P (if S&P is then rating the APS) of the
results of any vote described in the proceeding sentence.

     Right to Vote with Respect to Certain Other Matters. The affirmative vote
of the holders of a majority (unless a higher percentage vote is required under
the Declaration of Trust or under this Certificate of Vote) of the outstanding
shares of each series of APS, each voting as a separate class, is required with
respect to any matter that materially affects the series in a manner different
from that of other series of classes of the Fund's shares, including without
limitation any proposal to do the following: (1) increase or decrease the
aggregate number of authorized shares of the series; (2) effect an exchange,
reclassification, or cancellation of all or part of the shares of the series;
(3) effect an exchange, or create a right of exchange, of all or any part of the
shares of the series; (4) change the rights or preferences of the shares of the
series; (5) change the shares of the series, whether with or without par value,
into the same or a different number of shares, either with or without par value,
of the same or another class or series; (6) create a new class or series of
shares having rights and preferences prior and superior to the shares of the
series, or increase the rights and preferences or the number of authorized
shares of a series having rights and preferences prior or superior to the shares
of the series; or (7) cancel or otherwise affect distributions on the shares of
the series that have accrued but have not been declared. To the extent that the
interests of a series of APS affected by a matter are substantially identical to
the interests of another series of APS affected by such matter (e.g., a vote of
shareholders required under Section 13(a) of the 1940 Act), each such series
shall vote together collectively as one class. The vote of holders of APS
described above will in each case be in addition to a separate vote of the
requisite percentage of Common Shares and APS necessary to authorize the action
in question.

         Liquidation Rights. (a) Upon the dissolution, liquidation or winding up
of the affairs of the Fund, whether voluntary or involuntary, the Holders of the
APS then outstanding shall be entitled to receive and to be paid out of the
assets of the Fund available for distribution to its shareholders, before any
payment or distribution shall be made on the Common Shares or on any other class
of shares of the Fund ranking junior to the APS upon dissolution, liquidation or
winding up, an amount equal to the liquidation preference with respect to such
shares. The liquidation preference for the APS shall be $50,000 per share, plus
an amount equal to all dividends thereon (whether or not earned or declared)
accumulated but unpaid to the date of final distribution in same-day funds,
together with any payments required to be made pursuant to Section 12 in
connection with the liquidation of the Fund.


         3. Neither the sale of all or substantially all the property or
business of the Fund, nor the merger or consolidation of the Fund into or with
any other corporation nor the merger or consolidation of any other corporation
into or with the Fund shall be a dissolution, liquidation or winding up, whether
voluntary or involuntary, for the purposes of this Section 6.


                                      B-13
<PAGE>







     After the payment to the Holders of the APS of the full preferential
amounts provided for in this Section 6, the Holders of the APS as such shall
have no right or claim to any of the remaining assets of the Fund.

     In the event the assets of the Fund available for distribution to the
Holders of the APS upon any dissolution, liquidation or winding up of the
affairs of the Fund, whether voluntary or involuntary, shall be insufficient to
pay in full all amounts to which such Holders are entitled pursuant to paragraph
(a) of this Section 6, no such distribution shall be made on account of any
shares of any other class or series of Preferred Shares ranking on a parity with
the APS with respect to the distribution of assets upon such dissolution,
liquidation or winding up unless proportionate distributive amounts shall be
paid on account of the APS, ratably, in proportion to the full distributable
amounts for which holders of all such parity shares are respectively entitled
upon such dissolution, liquidation or winding up.

     Subject to the rights of the holders of shares of any series or class or
classes of shares ranking on a parity with the APS with respect to the
distribution of assets upon dissolution, liquidation or winding up of the
affairs of the Fund, after payment shall have been made in full to the Holders
of the APS as provided in paragraph (a) of this Section 6, but not prior
thereto, any other series or class or classes of shares ranking junior to the
APS with respect to the distribution of assets upon dissolution, liquidation or
winding up of the affairs of the Fund shall, subject to the respective terms and
provisions (if any) applying thereto, be entitled to receive any and all assets
remaining to be paid or distributed, and the Holders of the APS shall not be
entitled to share therein.

          Auction Agent. For so long as any of the APS is outstanding, the
Auction Agent, duly appointed by the Fund to so act, shall be in each case a
commercial bank, trust company or other financial institution independent of the
Fund and its affiliates (which, however, may engage or have engaged in business
transactions with the Fund or its affiliates) and at no time shall the Fund or
any of its affiliates act as the Auction Agent in connection with the Auction
Procedures. If the Auction Agent resigns or for any reason its appointment is
terminated during any period that any of the APS is outstanding, the Board of
Trustees shall use its best efforts promptly thereafter to appoint another
qualified commercial bank, trust company or financial institution to act as the
Auction Agent.

          1940 Act APS Asset Coverage. The Fund shall maintain, as of the last
Business Day of each month in which any of the APS is outstanding, the 1940 Act
APS Asset Coverage.

          APS Basic Maintenance Amount. (a) So long as APS are Outstanding, the
Fund shall maintain, on each Valuation Date, and shall verify to its
satisfaction that it is maintaining on such Valuation Date, (i) S&P Eligible
Assets having an aggregate Discounted Value equal to or greater than the APS
Basic Maintenance Amount (if S&P is then rating the APS) and (ii) Moody's
Eligible Assets having an aggregate Discounted Value equal to or greater than
the APS Basic Maintenance Amount (if Moody's is then rating the APS).

     On or before 5:00 P.M., New York City time, on the third Business Day after
a Valuation Date on which the Fund fails to satisfy the APS Basic Maintenance
Amount, and on the third Business Day after the APS Basic Maintenance Cure Date
with respect to such Valuation Date, the Fund shall complete and deliver to S&P
(if S&P is then rating the APS), Moody's (if Moody's is then rating the APS) and
the Auction Agent (if either S&P or Moody's is then rating the APS) an APS Basic
Maintenance Report as of the date of such failure or such APS Basic Maintenance
Cure Date, as the case may be, which will be deemed to have been delivered to
the Auction Agent if the Auction Agent receives a copy or telecopy, telex or
other electronic transcription thereof and on the same day the Fund mails to the
Auction Agent for delivery on the next Business Day the full APS Basic
Maintenance Report. The Fund shall also deliver an APS Basic Maintenance Report
to S&P (if S&P is then rating the APS), and the Auction Agent


                                      B-14
<PAGE>



(if S&P is then rating the APS) as of (i) the fifteenth day of each month (or,
if such day is not a Business Day, the next succeeding Business Day) and (ii)
the last Business Day of each month, in each case on or before the third
Business Day after such day. The Fund will also deliver an APS Basic Maintenance
Report to Moody's on any Valuation Date that (i) the Discounted Value of Moody's
Eligible Assets is greater than the APS Basic Maintenance Amount by 5% or less
or (ii) on any date which the Fund redeems Common Shares. A failure by the Fund
to deliver an APS Basic Maintenance Report under subparagraph (b) of this
Section 9 shall be deemed to be delivery of an APS Basic Maintenance Report
indicating the Discounted Value for all assets of the Fund is less than the APS
Basic Maintenance Amount, as of the relevant Valuation Date.

     Within ten Business Days after the date of delivery of an APS Basic
Maintenance Report in accordance with paragraph (b) of this Section 9 relating
to a Quarterly Valuation Date, the Fund shall cause the Independent Accountant
to confirm in writing to S&P (if S&P is then rating the APS), Moody's (if
Moody's is then rating the APS) and the Auction Agent (if either S&P or Moody's
is then rating the APS) (i) the mathematical accuracy of the calculations
reflected in such Report (and in any other APS Basic Maintenance Report,
randomly selected by the Independent Accountant, that was delivered by the Fund
during the quarter ending on such Quarterly Valuation Date) and (ii) that, in
such Report (and in such randomly selected Report), the Fund determined in
accordance with this Certificate of Vote whether the Fund had, at such Quarterly
Valuation Date (and at the Valuation Date addressed in such randomly-selected
Report), S&P Eligible Assets (if S&P is then raring the APS) of an aggregate
Discounted Value at least equal to the APS Basic Maintenance Amount and Moody's
Eligible Assets (if Moody's is then rating the APS) of an aggregate Discounted
Value at least equal to the APS Basic Maintenance Amount (such confirmation
being herein called the "Accountant's Confirmation").

     Within ten Business Days after the date of delivery of an APS Basic
Maintenance Report in accordance with paragraph (b) of this Section 9 relating
to any Valuation Date on which the Fund failed to satisfy the APS Basic
Maintenance Amount, and relating to the APS Basic Maintenance Cure Date with
respect to such failure to satisfy the APS Basic Maintenance Amount, the Fund
shall cause the Independent Accountant to provide to S&P (if S&P is then rating
the APS), Moody's (if Moody's is then rating the APS) and the Auction Agent (if
either S&P or Moody's is then rating the APS) an Accountant's Confirmation as to
such APS Basic Maintenance Report.

     If any Accountant's Confirmation delivered pursuant to subparagraph (c) or
(d) of this Section 9 shows that an error was made in the APS Basic Maintenance
Report for a particular Valuation Date for which such Accountant's Confirmation
was required to be delivered, or shows that a lower aggregate Discounted Value
for the aggregate of all S&P Eligible Assets (if S&P is then rating the APS) or
Moody's Eligible Assets (if Moody's is then rating the APS), as the case may be,
of the Fund was determined by the Independent Accountant, the calculation or
determination made by such Independent Accountant shall be final and conclusive
and shall be binding on the Fund, and the Fund shall accordingly amend and
deliver the APS Basic Maintenance Report to S&P (if S&P is then rating the APS),
Moody's (if Moody's is then rating the APS) and the Auction Agent (if either S&P
or Moody's is then rating the APS) promptly following receipt by the Fund of
such Accountant's Confirmation.

     On or before 5:00 p.m., New York City time, on the first Business Day after
the Date of Original Issue of the APS, the Fund shall complete and deliver to
S&P (if S&P is then rating the APS) and to Moody's (if Moody's is then rating
the APS), an APS Basic Maintenance Report as of the close of business on such
Date of Original Issue. Within five Business Days of such Date of Original
Issue, the Fund shall cause the Independent Accountant to confirm in writing to
S&P (if S&P is then rating the APS) and to Moody's (if Moody's is then rating
the APS) (i) the mathematical accuracy of the calculations reflected in such
Report and (ii) that the amount of S&P Eligible Assets reflected thereon equals
or exceeds the APS Basic Maintenance Amount reflected thereon.


                                      B-15
<PAGE>



          Minimum Liquidity Level. So long as S&P is rating the APS, the Fund
shall have, as of each Valuation Date, Dividend Coverage Assets, with respect to
each then Outstanding share of each series of APS, having a value not less than
the Dividend Coverage Amount with respect to such share (the "Minimum Liquidity
Level"). If, as of each Valuation Date, the Fund does not have the required
Dividend Coverage Assets, the Fund shall, as soon as practicable, adjust its
portfolio in order to meet the Minimum Liquidity Level, but only so long as S&P
is rating the APS. So long as S&P is rating the APS, the Fund shall notify S&P
on any Valuation Date which the Fund does not have the required Dividend
Coverage Assets and does not adjust its portfolio as described in the
immediately preceding sentence.

          Restrictions on Certain Distributions. For so long as any of the APS
is Outstanding, and except as set forth in Sections 2(e) and 6(d) of this Part
I, (A) the Fund shall not declare, pay or set apart for payment any dividend or
other distribution (other than a dividend or distribution paid in shares of, or
options, warrants or rights to subscribe for or purchase, Common Shares or other
shares, if any, ranking junior to the APS as to the payment of dividends and the
distribution of assets upon dissolution, liquidation or winding up) in respect
of the Common Shares or any other shares of the Fund ranking junior to or on a
parity with the APS as to the payment of dividends or the distribution of assets
upon dissolution, liquidation or winding up, or call for redemption, redeem,
purchase or otherwise acquire for consideration any Common Shares or any other
such junior shares (except by conversion into or exchange for shares of the Fund
ranking junior to the APS as to the payment of dividends and the distribution of
assets upon dissolution, liquidation or winding up), or any such parity shares
(except by conversion into or exchange for shares of the Fund ranking junior to
or on a parity with APS as to the payment of dividends and the distribution of
assets upon dissolution, liquidation or winding up), unless (i) full cumulative
dividends on shares of each series of APS through its most recently ended
Dividend Period shall have been paid or shall have been declared and sufficient
funds for the payment thereof deposited with the Auction Agent and (ii) the Fund
has redeemed the full number of shares of each series of APS required to be
redeemed by any provision for mandatory redemption pertaining thereto, and (B)
if either Moody's or S&P is rating the APS, the Fund shall not declare, pay or
set apart for payment any dividend or other distribution (other than a dividend
or distribution paid in shares of, or options, warrants or rights to subscribe
for or purchase, Common Shares or other shares, if any, ranking junior to the
APS as to the payment of dividends and the distribution of assets upon
dissolution, liquidation or winding up) in respect of Common Shares or any other
shares of the Fund ranking junior to the APS as to the payment of dividends or
the distribution of assets upon dissolution, liquidation or winding up, or call
for redemption, redeem, purchase or otherwise acquire for consideration any
shares of Common Shares or any other such junior shares (except by conversion
into or exchange for shares of the Fund ranking junior to the APS as to the
payment of dividends and the distribution of assets upon dissolution,
liquidation or winding up), unless immediately after such transaction the
Discounted Value of Moody's Eligible Assets and S&P Eligible Assets would each
at least equal the APS Basic Maintenance Amount.

          Additional Dividends. If the Fund retroactively allocates any net
capital gains or other income taxable for federal income tax purposes to the APS
without having given advance notice thereof to the Auction Agent as provided in
Section 6 of Part II solely by reason of the fact that such allocation is made
as a result of the redemption of all or a portion of the outstanding APS or the
liquidation of the Fund (such allocation being referred to herein as a
"Retroactive Taxable Allocation"), the Fund shall, within 270 days after the end
of the Fund's taxable year in which a Retroactive Taxable Allocation is made,
provide notice thereof to the Auction Agent and to each Holder of such shares
during such taxable year at such Holder's address as the same appears or last
appeared on the share books of the Fund. Such Holders of such shares shall be
entitled to receive, when, as and if declared by the Board of Trustees, out of
funds legally available therefor, dividends in an amount equal to the aggregate
Additional Dividends with respect to all Retroactive Taxable Allocations made to
such shares during the taxable year in question, such dividends to be payable by
the Fund to the Auction Agent, for distribution to such Holders, within 30 days
after the notice described above is given to the Auction Agent.


                                      B-16
<PAGE>



          Certain Other Restrictions. (a) For so long as any of the APS is
outstanding and Moody's is then rating such shares, the Fund will not, unless it
has received written confirmation from Moody's that any such action would not
impair the ratings then assigned by Moody's to the APS, engage in any one or
more of the following transactions:

               (a) transactions in options on securities, futures contracts or
     options on futures contracts except that in connection with Moody's Hedging
     Transactions: (A) the Fund may buy call or put option contracts on
     securities; (B) the Fund may write covered call options on securities; (C)
     the Fund may write put options on securities; (D) the Fund may enter into
     positions in futures contracts based on the Municipal Index provided that
     the Fund shall not engage in any such transaction which would cause the
     Fund at the time of such transaction to own or have sold (1) outstanding
     futures contracts based on the Municipal Index exceeding in number 10% of
     the rolling average number of daily traded futures contracts based on the
     Municipal Index in the 30 calendar days prior to the time of effecting such
     transaction as reported by The Wall Street Journal or (2) outstanding
     futures contracts based on the Municipal Index and options on such futures
     contracts having an aggregate fair market value (taking into account the
     fair market value of futures contracts based on Treasury Bonds) exceeding
     the fair market value of Moody's Eligible Assets owned by the Fund; (E) the
     Fund may enter into futures contracts on Treasury Bonds provided that the
     Fund shall not engage in any such transaction which would cause the Fund at
     the time of such transaction to own or have sold (1) outstanding futures
     contracts based on Treasury Bonds and options on such futures contracts
     having an aggregate fair market value (taking into account the fair market
     value of futures contracts based on the Municipal Index) exceeding 40% of
     the aggregate fair market value of Moody's Eligible Assets owned by the
     Fund and rated Aa by Moody's (or, if not rated by Moody's but rated by S&P,
     rated AAA by S&P) or (2) outstanding futures contracts based on Treasury
     Bonds and options on such futures contracts having an aggregate fair market
     value (taking into account the fair market value of futures contracts based
     on the Municipal Index) exceeding 80% of the aggregate fair market value of
     Moody's Eligible Assets owned by the Fund and rated Baa or A by Moody's
     (or, if not rated by Moody's but rated by S&P, rated A or AA by S&P); for
     purposes of the foregoing clauses (D) and (E), the Fund shall be deemed to
     own the number of futures contracts that underlie any outstanding option
     written by the Fund; and (F) the Fund may buy call or put options on
     futures contracts on the Municipal Index or Treasury Bonds, may write put
     options on such futures contracts (provided, that if the contract would
     require delivery of a security, that security must be held by the Fund) and
     may write call options on such futures if it owns the futures contract
     subject to the option. For so long as the APS are rated by Moody's, the
     Fund will engage in Closing Transactions to close out any outstanding
     futures contract based on the Municipal Index if the open interest with
     respect to such futures contracts based on the Municipal Index as reported
     by The Wall Street Journal is less than 5,000. For so long as the APS are
     rated by Moody's, the Fund will engage in a Closing Transaction to close
     out any outstanding futures contract by no later than the fifth Business
     Day of the month in which such contract expires and will engage in a
     Closing Transaction to close out any outstanding option on a futures
     contract by no later than the first Business Day of the month in which such
     option expires. For so long as the APS are rated by Moody's, the Fund will
     engage in transactions with respect to futures contracts or options thereon
     having only the next settlement date or the settlement date immediately
     thereafter. For purposes of valuation of Moody's Eligible Assets: (A) if
     the Fund writes a call option, the underlying asset will be valued as
     follows: (1) if the option is exchange-traded and may be offset readily or
     if the option expires before the earliest possible redemption of the APS,
     at the Discounted Value of the


                                      B-17
<PAGE>



     underlying security of the option or (2) otherwise, it has no value; (B) if
     the Fund writes a put option, the underlying asset will be valued as
     follows: the lessor of (1) exercise price and (2) the Discounted Value of
     the underlying security; (C) if the Fund is a seller under a futures
     contract, the underlying security will be valued at the lower of (1)
     settlement price and (2) the Discounted Value of the underlying security;
     if a contract matures within the Moody's Exposure Period, the security may
     be valued at the settlement price; (D) if the Fund is the buyer under a
     futures contract, the underlying security will be valued at the lower of
     (1) the settlement price and (2) the Discounted Value of the underlying
     security; if the contract matures within the Moody's Exposure Period, the
     security may be valued at its Discounted Value and (E) call or put option
     contracts which the Fund buys have no value. For so long as APS are rated
     by Moody's: (A) the Fund will not engage in options and futures
     transactions for leveraging or speculative purposes; (B) the Fund will not
     write any anticipatory call options pursuant to which the Fund hedges the
     anticipated purchase of an asset prior to completion of such purchase; (C)
     the Fund will not enter into an option transaction unless, after giving
     effect thereto, the Fund would continue to have Moody's Eligible Assets
     with an aggregate Discounted Value equal to or greater than the APS Basic
     Maintenance Amount; (D) the Fund will not enter into an option transaction
     unless after giving effect to such transaction the Fund would continue to
     be in compliance with the provisions relating to the APS Basic Maintenance
     Amount; (E) for purposes of the APS Basic Maintenance Amount (1) assets in
     margin accounts are not Moody's Eligible Assets, (2) 10% of the settlement
     price of assets sold under a futures contract, the settlement price of
     assets purchased under a futures contract, the settlement price of an
     underlying futures contract if the Fund writes put options on futures
     contracts will constitute liabilities of the Fund and (3) if the Fund
     writes call options on futures contracts and does not own the underlying
     futures contract, 105% of the Market Value of the Market Value of the
     underlying futures contract will constitute a liability of the Fund; (F)
     the Fund shall enter into only exchange-traded futures and shall write only
     exchange-traded options on exchanges approved by Moody's; (G) where
     delivery may be made to the Fund with any of a class of securities, the
     Fund shall assume for purposes of the APS Basic Maintenance Amount that it
     takes delivery of that security which yields it the least value; (H) the
     Fund will not engage in forward contracts; (1) the Fund will enter into
     futures contracts as seller only if it owns the underlying security; and
     (J) there shall be a quarterly audit made of the Fund's futures and options
     transactions by the Fund's independent accountants to confirm that the Fund
     is in compliance with these standards; or

     incur any indebtedness in a principal amount in excess of the lesser of
$10,000,000 or 10% of the aggregate liquidation preference of APS Outstanding,
without prior written approval of Moody's that such indebtedness would not
adversely affect the then current rating by Moody's of the APS except that the
Fund may, without obtaining the written confirmation described above, incur
indebtedness for the purpose of clearing securities transactions if the APS
Basic Maintenance Amount would continue to be satisfied after giving effect to
such indebtedness; or

     issue any class or series of shares ranking prior to or on a parity with
the APS with respect to the payment of dividends or the distribution of assets
upon dissolution, liquidation or winding up of the Fund, or reissue any APS
previously purchased or redeemed by the Fund; or

          4. For so long as any of the APS is Outstanding and S&P is rating such
shares, the Fund will not, unless the Fund has received written confirmation
from S&P that any such action would not impair the rating then assigned by such
rating agency to the APS, engage in any one or more of the following
transactions:


                                      B-18
<PAGE>



     transactions in any reverse repurchase agreements; or

     lend portfolio securities; or

     borrow money, except that the Fund may, without obtaining the written
confirmation described above, borrow money for the purposes of clearing
securities transactions if the APS Basic Maintenance Amount would continue to be
satisfied after giving effect to such borrowing; or

     issue any class or series of shares ranking prior to or on a parity with
the APS with respect to the payment of dividends or the distribution of assets
upon dissolution, liquidation or winding up of the Fund, or reissue any APS
previously purchased or redeemed by the Fund, or merge or consolidate with any
corporation; or

     engage in repurchase agreement transactions in which the term of such
repurchase obligation is longer than 90 days, in which the underlying security
is a security other than United States treasury securities (not inclusive of
zero-coupon securities), demand deposits, certificates of deposits or bankers
acceptance in which the counter-party or its affiliates have securities rated
A1+ by S&P with respect to such underlying security; or

     engage in short sale transactions; or

     purchase or sell futures contracts or options thereon or write uncovered
put or uncovered call options on portfolio securities except that (A) the Fund
may engage in any S&P Hedging Transactions based on the Municipal Index,
provided that the Fund shall not engage in any S&P Hedging Transaction based on
the Municipal Index (other than Closing Transactions) which would cause the Fund
at the time of such transaction to own or have sold the least of (1) more than
1,000 outstanding futures contracts based on the Municipal Index, (2)
outstanding futures contracts based on the Municipal Index and on the Treasury
Bonds exceeding in number 25% of the quotient of the fair market value of the
Fund's total assets divided by 100,000 or (3) outstanding futures contract based
on the Municipal Index exceeding in number 10% of the average number of daily
traded futures contracts based on the Municipal Index in the month prior to the
time of effecting such transaction as reported by The Wall Street Journal and
(B) the Fund may engage in S&P Hedging Transactions based on Treasury Bonds,
provided that the Fund shall not engage in any S&P Hedging Transaction based on
Treasury Bonds (other than Closing Transactions) which would cause the Fund at
the time of such transaction to own or have sold the lesser of (1) outstanding
futures contracts based on Treasury Bonds and on the Municipal Index exceeding
in number 25% of the quotient of the fair market value of the Fund's total
assets divided by 100,000 or (2) outstanding futures contracts based on Treasury
Bonds exceeding in number 10% of the average number of daily traded futures
contracts based on Treasury Bonds in the month prior to the time of effecting
such transaction as reported by The Wall Street Journal. For so long as the APS
are rated by S&P, the Fund will engage in Closing Transactions to close out any
outstanding futures contracts which the Fund owns or has sold or any outstanding
option thereon owned by the Fund in the event (A) the Fund does not have S&P
Eligible Assets with an aggregate Discounted Value equal to or greater than the
APS Basic Maintenance Amount on two consecutive Valuation Dates and (B) the Fund
is required to pay Variation Margin on the second such Valuation Date. For so
long as the APS are rated by S&P, the Fund will engage in a Closing Transaction
to close out any outstanding futures contract or option thereon in the month
prior to the delivery month under the terms of such futures contract or option
thereon unless the Fund holds securities deliverable under such terms. For
purposes of determining S&P Eligible Assets to determine compliance with the APS
Basic Maintenance Amount, no amounts on deposit with the


                                      B-19
<PAGE>


Fund's custodian or broker representing Initial Margin or Variation Margin shall
constitute S&P Eligible Assets. For so long as the APS are rated by S&P, when
the Fund writes a futures contract or option thereon, it will maintain an amount
of cash, cash equivalents or short-term, money market securities in a segregated
account with the Fund's custodian, so that the amount so segregated plus the
amount of Initial Margin and Variation Margin held in the account of the Fund's
broker equals the fair market value of the futures contract, except that in the
event the Fund writes a futures contract or option thereon which requires
delivery of an underlying security, the Fund shall hold such underlying
security.

          Notice. All notices or communications, unless otherwise specified in
the By-Laws of the Fund or this Certificate of Vote, shall be sufficiently given
if in writing and delivered in person or mailed by first-class mail, postage
prepaid. Notice shall be deemed given on the earlier of the date received or the
date seven days after which such notice is mailed.

          Definitions. As used in Parts I and II hereof, the following terms
shall have the following meanings (with terms defined in the singular having
comparable meanings when used in the plural and vice versa), unless the context
otherwise requires:

          1. "'AA' Composite Commercial Paper Rate," on any date for any Rate
Period, shall mean (i) (A) in the case of any Minimum Dividend Period or any
Rate Period between 7 and 28 Rate Period Days, the interest equivalent of the
30-day rate; provided, however, in the case of any Minimum Dividend Period of 7
days or any Rate Period with 7 Rate Period Days and the "AA" Composite
Commercial Paper Rate is being used to determine the Applicable Rate when all of
the Outstanding APS are subject to Submitted Hold Orders, then the interest
equivalent of the 7-day rate, and (B) in the case of any Rate Period with more
than 28 Rate Period Days, the interest equivalent of the 180-day rate, on
commercial paper placed on behalf of issuers whose corporate bonds are rated
"AA" by S&P or the equivalent of such rating by S&P or another rating agency, as
made available on a discount basis or otherwise by the Federal Reserve Bank of
New York for the Business Day immediately preceding such date; or (ii) in the
event that the Federal Reserve Bank of New York does not make available any such
rate, then the arithmetic average of such rates, as quoted on a discount basis
or otherwise, by the Commercial Paper Dealers to the Auction Agent for the close
of business on the Business Day next preceding such date. If any Commercial
Paper Dealer does not quote a rate required to determine the "AA" Composite
Commercial Paper Rate, the "AA" Composite Commercial Paper Rate shall be
determined on the basis of the quotation or quotations furnished by the
remaining Commercial Paper Dealer or Commercial Paper Dealers and any Substitute
Commercial Paper Dealer or Substitute Commercial Paper Dealers selected by the
Fund to provide such rate or rates not being supplied by any Commercial Paper
Dealer or Commercial Paper Dealers, as the case may be, or, if the Fund does not
select any such Substitute Commercial Paper Dealer or Substitute Commercial
Paper Dealers, by the remaining Commercial Paper Dealer or Commercial Paper
Dealers. For purposes of this definition, the "interest equivalent" of a rate
stated on a discount basis (a "discount rate") for commercial paper of a given
days' maturity shall be equal to the quotient (rounded upwards to the next
higher one-thousandth (.001) of 1%) of (A) the discount rate divided by (B) the
difference between (x) 1.00 and (y) a fraction the numerator of which shall be
the product of the discount rate times the number of days in which such
commercial paper matures and the denominator of which shall be 360.

     "Accountant's Confirmation" shall have the meaning set forth in paragraph
(c) of Section 9 of this Part I.

     "Additional Dividends" means payment to a Holder of APS of an amount which,
when taken together with the aggregate amount of Retroactive Taxable Allocations
made to such Holder with respect to the taxable year in question, would cause
such Holder's dividends in dollars (after federal income tax


                                      B-20
<PAGE>


consequences) from the aggregate of both the Retroactive Taxable Allocations and
the Additional Dividends to be equal to the dollar amount of the dividends which
would have been received by such Holder if the amount of the aggregate
Retroactive Taxable Allocations would have been excludable from the gross income
of such Holder. Such Additional Dividends shall be calculated (i) without
consideration being given to the time value of money; (ii) assuming that no
Holder of APS is subject to the federal alternative minimum tax with respect to
dividends received from the Fund; and (iii) assuming that each Retroactive
Taxable Allocation would be taxable in the hands of each Holder of APS at the
maximum marginal regular federal individual income tax rate applicable to
ordinary income or net capital gains, as applicable, or the maximum marginal
regular federal corporate income tax rate, whichever is greater, in effect
during the taxable year in question.

     "Anticipation Notes" means the following municipal securities: tax
anticipation notes, revenue anticipation notes and tax and revenue anticipation
notes.

     "Applicable Rate" shall have the meaning specified in subparagraph (c)(i)
of Section 2 of this Part 1.

     "APS Basic Maintenance Amount," as of any Valuation Date, shall mean the
dollar amount equal to the sum of (i)(A) the product of the number of APS
Outstanding on such date multiplied by $50,000; (B) the aggregate amount of
dividends that will have accumulated at the Applicable Rate (whether or not
earned or declared) to (but not including) the first respective Dividend Payment
Dates for each of the APS Outstanding that follow such Valuation Date; (C) the
amount equal to the Projected Dividend Amount (based on the number of APS
Outstanding on such date); (D) the amount of anticipated expenses of the Fund
for the 90 days subsequent to such Valuation Date; (E) the amount of the Fund's
Maximum Potential Additional Dividend Liability as of such Valuation Date; (F)
the amount of any premium payable pursuant to a Premium Call Period; and (G) any
current liabilities as of such Valuation Date to the extent not reflected in any
of (i)(A) through (i)(F) (including, without limitation, any amounts described
in Section 13 of Part I as required to be treated as liabilities in connection
with the Fund's transactions in futures and options and including any payables
for municipal securities purchased as of such Valuation Date) less (ii) either
(A) the face value of any of the Fund's assets irrevocably deposited by the Fund
for the payment of any of (i)(A) through (i)(G) if such assets mature within the
Moody's Exposure Period and are either securities issued or guaranteed by the
United States Government or have a rating assigned by Moody's of P-1, VMIG-1 or
MIG-1 (or, with respect to S&P, SP-1+ or A-1+) or (B) the Discounted Value of
such assets. For purposes of the APS Basic Maintenance Amount in connection with
S&P's ratings of the APS, with respect to any transactions by the Fund in
futures contracts, the Fund shall include as liabilities (i) 30% of the
aggregate settlement value, as marked to market, of any outstanding futures
contracts based on the Municipal Index which are owned by the Fund plus (ii) 25%
of the aggregate settlement value, as marked to market, of any outstanding
futures contracts based on Treasury Bonds which contracts are owned by the Fund.
For purposes of the APS Basic Maintenance Amount in connection with Moody's
rating of the APS, with respect to any transactions by the Fund in securities
options, the Fund shall include as liabilities (i) 10% of the exercise price of
a call option written by the Fund and (ii) the exercise price of any written put
option.

     "APS Basic Maintenance Cure Date," with respect to the failure by the Fund
to satisfy the APS Basic Maintenance Amount (as required by paragraph (a) of
Section 9 of this Part I) as of a given Valuation Date, shall mean the third
Business Day following such Valuation Date.

     "APS Basic Maintenance Report" shall mean a report signed by the President,
Treasurer or any Senior Vice President or Vice President of the Fund which sets
forth, as of the related Valuation Date, the assets of the Fund, the Market
Value and the Discounted Value thereof (seriatim and in aggregate), and the APS
Basic Maintenance Amount.


                                      B-21
<PAGE>


     "Auction" shall mean each periodic implementation of the Auction
Procedures.

     "Auction Agency Agreement" shall mean the agreement between the Fund and
the Auction Agent which provides, among other things, that the Auction Agent
will follow the Auction Procedures for purposes of determining the Applicable
Rate for each series of APS so long as the Applicable Rate for such series is to
be based on the results of an Auction.

     "Auction Agent" shall mean the entity appointed as such by a resolution of
the Board of Trustees in accordance with Section 7 of this Part I.

     "Auction Date," with respect to any Rate Period, shall mean the Business
Day next preceding the first day of such Rate Period.

     "Auction Procedures" shall mean the procedures for conducting Auctions set
forth in Part II hereof.

     "Board of Trustees" shall mean the Board of Trustees of the Fund or any
duly authorized committee thereof.

     "Business Day" shall mean a day on which the New York Stock Exchange is
open for trading and which is neither a Saturday, Sunday nor any other day on
which banks in The City of New York, New York, are authorized by law to close.

     "Closing Transactions" means the termination of a futures contract or
option position by taking an equal position opposite thereto in the same
delivery month as such initial position being terminated.

     "Commercial Paper Dealers" shall mean Goldman, Sachs& Co., Lehman
Commercial Paper Incorporated, Merrill Lynch, Pierce, Fenner & Smith
Incorporated and Smith Barney, Harris Upham & Co. or, in lieu of any thereof,
their respective affiliates or successors, if such entity is a commercial paper
dealer.

     "Common Shares" shall mean the common shares of beneficial interest, par
value $.01 per share, of the Fund.

     "Cure Date" shall mean the APS Basic Maintenance Cure Date or the 1940 Act
Cure Date, as the case may be.

     "Date of Original Issue," with respect to any series of APS, shall mean the
date on which the Fund initially issued shares of such series of APS.

     "Deposit Securities" shall mean cash and municipal securities rated at
least A-1+ or SP-1+ by S&P, except that, for purposes of Section 3(a)(iii) of
this Part I, such municipal securities shall be considered "Deposit Securities"
only if they are also rated P-1, MIG-1 or VMIG-1 by Moody's.

     "Discounted Value" shall mean (i) with respect to an S&P Eligible Asset,
the quotient of the Market Value thereof divided by the applicable S&P Discount
Factor and (ii) with respect to a Moody's Eligible Asset, the quotient of the
Market Value thereof divided by the applicable Moody's Discount Factor, provided
that with respect to a Moody's Eligible Asset, Discounted Value shall not exceed
the par value of such Asset at any time.

     "Dividend Coverage Amount," as of any Valuation Date, shall mean, with
respect to each of the APS, (i) the aggregate amount of dividends that will
accumulate on such APS to (but not including) the first


                                      B-22
<PAGE>



Dividend Payment Date for such share that follows such Valuation Date plus any
liabilities that will become payable prior to or on such payment date, less (ii)
the combined value of Deposit Securities irrevocably deposited for the payment
of dividends on such APS.

     "Dividend Coverage Assets," as of any Valuation Date, shall mean, with
respect to each of the APS, Deposit Securities with maturity or tender dates not
later than the day preceding the first Dividend Payment Date for such share that
follows such Valuation Date and having a value not less than the Dividend
Coverage Amount with respect to such share.

     "Dividend Payment Date," with respect to any series of APS, shall mean any
date on which dividends on shares of such series of APS are payable pursuant to
the provisions of paragraph (b) of Section 2 of this Part I.

     "Dividend Period," with respect to any series of APS, shall mean the period
from and including the Date of Original Issue of such series to but excluding
the initial Dividend Payment Date for such series and any period thereafter from
and including one Dividend Payment Date for such series to but excluding the
next succeeding Dividend Payment Date for such series.

     "Fund" shall mean Van Kampen Merritt Municipal Trust, a Massachusetts
business trust, which is the issuer of the APS.

     "Failure to Deposit," with respect to any series of APS, shall mean a
failure by the Fund to pay to the Auction Agent, not later than 12:00 noon, New
York City time, (A) on the Business Day next preceding any Dividend Payment Date
for such series, in funds available on such Dividend Payment Date in The City of
New York, New York, the full amount of any dividend (whether or not earned or
declared) to be paid on such Dividend Payment Date on any share of such series
or (B) on the Business Day next preceding any redemption date in funds available
on such redemption date for such series in The City of New York, New York, the
Redemption Price to be paid on such redemption date for any share of such series
after notice of redemption is given pursuant to paragraph (b) of Section 3 of
this Part 1.

     "Holder," with respect to any series of APS, shall mean the registered
holder of shares of such series of APS as the same appears on the share books of
the Fund.

     "Independent Accountant" shall mean a nationally recognized accountant, or
firm of accountants, that is with respect to the Fund an independent public
accountant or firm of independent public accountants under the Securities Act of
1933, as amended from time to time.

     "Initial Dividend Period," with respect to any series of APS, shall mean
the period from and including the Date of Original Issue thereof to but
excluding the initial Dividend Payment Date therefor.

     "Interest Equivalent" means a yield on a 360-day basis of a discount basis
security which is equal to the yield on an equivalent interest-bearing security.

     "Initial Margin" means the amount of cash or securities deposited with a
custodian for the benefit of a futures commission merchant as a good-faith
deposit at the time of the initiation of a purchase or sale position with
respect to a futures contract or a sale position with respect to an option
position thereon.

     "Market Value" of any asset of the Fund shall mean the market value thereof
determined by the Pricing Service designated from time to time by the Board of
Trustees. Market Value of any asset shall include any interest accrued thereon.
The Pricing Service values portfolio securities at the mean between the quoted
bid and asked price or the yield equivalent when quotations are readily
available. Securities for


                                      B-23
<PAGE>


which quotations are not readily available are valued at fair value as
determined by the pricing service using methods which include consideration of
yields or prices of municipal bonds of comparable quality, type of issue,
coupon, maturity and rating; indications as to value from dealers; and general
market conditions. The pricing service may employ electronic data processing
techniques and/or a matrix system to determine valuations.

     "Mandatory Redemption Price" means $50,000 per share of APS plus an amount
equal to accumulated but unpaid dividends thereon to the date fixed for
redemption (whether or not earned or declared).

     "Master Purchaser's Letter" has the meaning specified in Section 1 of Part
II hereof.

     "Maximum Potential Additional Dividends Liability," as of any Valuation
Date, shall mean the aggregate amount of Additional Dividends that would be due
if the Fund were to make Retroactive Taxable Allocations, with respect to any
fiscal year, estimated based upon dividends paid and the amount of undistributed
realized net capital gains and other taxable income earned by the Fund, as of
the end of the calendar month immediately preceding such Valuation Date, and
assuming such Additional Dividends are fully taxable.

     "Minimum Liquidity Level" shall have meaning set forth in Section 10 of
this Part I.

     "Minimum Dividend Period" shall mean (i) with respect to APS Series A and
APS Series C, any Rate Period consisting of 7 Rate Period Days and (ii) with
respect to APS Series B and APS Series D, any Rate Period with 28 Rate Period
Days, in each case subject to certain exceptions.

     "Moody's" shall mean Moody's Investors Service, Inc., a Delaware
corporation, and its successors.

     "Moody's Discount Factor" shall mean, for purposes of determining the
Discounted Value of any Moody's Eligible Asset, the percentage determined by
reference to the rating on such asset and the shortest Exposure Period set forth
opposite such rating that is the same length as or is longer than the Moody's
Exposure Period, in accordance with the table set forth below:

<TABLE>
<CAPTION>

                                     Rating Category

                                     ----------------------------------------------------------------------------------
Exposure Period(4)                      Aaa        Aa(1)      A(1)      Baa(1)    Other(2)    (V)MIG-1(3)(4)  SP-1+(3)
- ------------------                      ---        ---        --        ----      ------      -----------     ------
<S>                                     <C>        <C>       <C>        <C>       <C>         <C>             <C>
7 weeks........................          151%       159%       168%       202%       229%          136%          148%
8 weeks or less but greater than         154        164        173        205        235           137           149
seven weeks....................
9 weeks or less but greater than         158        169        179        209        242           138           150
eight weeks....................

</TABLE>


(1)     Moody's rating.
(2)     Municipal securities not rated by Moody's but rated BBB by S&P.
(3)     Municipal securities rated MIG-1 or VMIG-1 or, if not rated by Moody's,
        rate SP-1+ by S&P which do not mature or have a demand feature at par
        exercisable within the Moody's Exposure Period and which do not have a
        long-term rating.
(4)     For the purposes of the definition of Moody's Eligible Assets, these
        securities will have an assumed rating of "A" by Moody's.


                                      B-24
<PAGE>

         Notwithstanding the foregoing, (i) the Moody's Discount Factor for
short-term municipal securities will be 115%, so long as such municipal
securities are rated at least MIG-1, VMIG-1 or P-1 by Moody's and mature or have
a demand feature at par exercisable within the Moody's Exposure Period or 125%
as long as such municipal securities are rated at least A-1-/AA or SP-1+/AA by
S&P and mature or have a demand feature at par exercisable within the Moody's
Exposure Period and (ii) no Moody's Discount Factor will be applied to cash or
to Receivables for Municipal Securities Sold.

         "Moody's Eligible Asset" shall mean cash, Receivables for Municipal
Securities Sold or a municipal security that (i) pays interest in cash, (ii) is
publicly rated Baa or higher by Moody's or, if not rated by Moody's but rated by
S&P, is rated at least BBB by S&P (provided that, for purposes of determining
the Moody's Discount Factor applicable to any such S&P-rated municipal security,
such municipal security (excluding any short-term municipal security) shall be
deemed to have a Moody's rating which is one full rating category lower than its
S&P rating), (iii) does not have its Moody's rating suspended by Moody's; and
(iv) is part of an issue of municipal securities of at least $10,000,000.
Municipal securities issued by any one issuer and rated BBB by S&P may comprise
no more than 4% of total Moody's Eligible Assets; such BBB-rated municipal
securities, if any, together with any municipal securities issued by the same
issuer and rated Baa by Moody's or A by S&P, may comprise no more than 6% of
total Moody's Eligible Assets; such BBB, Baa and A-rated municipal securities,
if any, together with any municipal securities issued by the same issuer and
rated A by Moody's or AA by S&P, may comprise no more than 10% of total Moody's
Eligible Assets; and such BBB, Baa, A and AA rated municipal securities, if any,
together with any municipal securities issued by the same issuer and rated Aa by
Moody's or AAA by S&P, may comprise no more than 20% of total Moody's Eligible
Assets. For purposes of the foregoing sentence, any municipal security backed by
the guaranty, letter of credit or insurance issued by a third party shall be
deemed to be issued by such third party if the issuance of such third party
credit is the sole determinant of the rating on such municipal security.
Municipal securities issued by issuers located within a single state or
territory and rated BBB by S&P may comprise no more than 12% of total Moody's
Eligible Assets; such BBB-rated municipal securities, if any, together with any
municipal securities issued by issuers located within the same state or
territory and rated Baa by Moody's or A by S&P may comprise no more than 20% of
total Moody's Eligible Assets; such BBB, Baa and A rated municipal securities,
if any, together with any municipal securities issued by issuers located within
the same state or territory and rated A by Moody's or AA by S&P, may comprise no
more than 40% of total Moody's Eligible Assets; and such BBB, Baa, A and
AA-rated municipal securities, if any, together with any municipal securities
issued by issuers located within the same state or territory and rated Aa by
Moody's or AAA by S&P, may comprise no more than 60% of total Moody's Eligible
Assets. For purposes of applying the foregoing requirements, a municipal
security shall be deemed to be rated BBB by S&P if rated BBB or BBB+ by S&P.
Moody's Eligible Assets shall be calculated without including cash and municipal
securities rated MIG-1 or VMIG-1 or, if not rated by Moody's, rated SP-1+ by
S&P, which either mature or have a demand feature at par exercisable within the
Moody's Exposure Period. Municipal securities which constitute Moody's Eligible
Assets subject to a repurchase agreement will constitute Moody's Eligible
Assets. Cash receivable by the Fund pursuant to a repurchase agreement that
obligates the other party thereto to repurchase municipal securities will only
constitute a Moody's Eligible Asset if the long-term debt of such other party is
rated at least A2 by Moody's and such agreement has a term of 30 days or less.

         Notwithstanding the foregoing, an asset will not be considered a
Moody's Eligible Asset to the extent that is has been deposited for the payment
of (i)(A) through (i)(G) under the definition of APS Basic Maintenance Amount or
it is subject to any material lien, mortgage, pledge, security interest or
security agreement of any kind (collectively, "Liens"), except for (a) Liens
which are being contested in good faith by appropriate proceedings and which
Moody's has indicated to the Fund will not affect the status of such asset as a
Moody's Eligible Asset, (b) Liens for taxes that are not then due and payable or
that can be paid thereafter without penalty, (c) Liens to secure payment for
services rendered or cash




                                       B-25
<PAGE>


advanced to the Fund by Van Kampen Merritt Investment Advisory Corp., the
Administrator, State Street Bank and Trust Company or the Auction Agent and (d)
Liens by virtue of any repurchase agreement.

         "Moody's Exposure Period" shall mean the period commencing on a given
Valuation Date and ending 46 days thereafter.

         "Moody's Hedging Transactions" shall mean transactions in options on
securities, futures contracts based on the Municipal Index or Treasury Bonds and
options on such futures contracts.

         "Municipal Index" shall mean The Bond Buyer Municipal Bond Index.

         "1940 Act" shall mean the Investment Company Act of 1940, as amended
from time to time.

         "1940 Act APS Asset Coverage" shall mean asset coverage, as defined in
Section 18(h) of the 1940 Act, of at least 200% with respect to all outstanding
senior securities of the Fund which are stock, including all outstanding APS (or
such other asset coverage as may in the future be specified in or under the 1940
Act as the minimum asset coverage for senior securities which are stock of a
closed-end investment company as a condition of declaring dividends on its
common stock).

         "1940 Act Cure Date," with respect to the failure by the Fund to
maintain the 1940 Act APS Asset Coverage (as required by Section 8 of this Part
I) as of the last Business Day of each month, shall mean the last Business Day
of the following month.

         "Non-call Period" shall have the meaning set forth below under
"Specific Redemption Provisions."

         "Notice of Redemption" shall mean any notice with respect to the
redemption of the APS pursuant to Section 3 of this Part I.

         "Optional Redemption Price" shall mean (i) $50,000 per share of APS in
the case of a 7-day or 28-day Dividend Period or a Special Dividend Period of
less than 365 days or (ii) with respect to a Special Dividend Period of 365 days
or more the Optional Redemption Price set forth in the Specific Redemption
Provisions in connection therewith; in each case plus an amount equal to
accumulated but unpaid dividends thereon to the date of redemption (whether or
not earned or declared).

         "Preferred Shares" shall mean the authorized preferred shares of
beneficial interest, par value $.01 per share, of the Fund, and includes the
APS.

         "Premium Call Period" shall have the meaning set forth below under
"Specific Redemption Provisions."

         "Pricing Service" means Van Kampen Merritt Investment Advisory Corp.,
acting pursuant to a Fund Pricing Agreement between the Fund and Van Kampen
Merritt Investment Advisory Corp. and any successor pricing service approved in
writing by Moody's (if Moody's is then rating the APS) and S&P (if S&P is then
rating the APS).

         "Projected Dividend Amount" means, with respect to the shares of any
series of APS, on any Valuation Date in the event the then current Dividend
Period will end within 47 calendar days of such date, from and after the last
day of such Dividend Period until 47 calendar days less the number of days
remaining in the current Dividend Period at an Applicable Rate equal to the
Maximum Rate for such Dividend Period multiplied by the larger of the factors
(currently 304%) that the Fund has been informed




                                       B-26
<PAGE>

by Moody's and S&P is applicable to the Projected Dividend Amount and designed
to take into account increases in dividend rates over such period.

         "Quarterly Valuation Date" shall mean the last Business Day of each
fiscal quarter of the Fund in each fiscal year of the Fund, commencing February
29, 1992.

         "Rate Period," with respect to any series of APS, shall mean the
Initial Dividend Period thereof and any Subsequent Dividend Period, including
any Special Dividend Period, for such series.

         "Rate Period Days," for any Rate Period consisting of less than four
Dividend Periods, shall mean the number of days (without giving effect to
subparagraph (b)(ii) of Section 2 of this Part 1) in such Rate Period.

         "Receivables for Municipal Securities Sold" shall mean (A) for purposes
of calculation of Moody's Eligible Assets as of any Valuation Date, no more than
the aggregate of the following: (i) the book value of receivables for municipal
securities sold as of or prior to such Valuation Date if such receivables are
due within five business days of such Valuation Date, and if the trades which
generated such receivables are (x) settled through clearing house firms with
respect to which the Fund has received prior written authorization from Moody's
or (y) with counterparties having a Moody's long-term debt rating of at least
Baa3; and (ii) the Moody's Discounted Value of municipal securities sold as of
or prior to such Valuation Date which generated receivables, if such receivables
are due within the Moody's Exposure Period but do not comply with either of the
conditions specified in (i) above, and (B) for purposes of calculation of S&P
Eligible Assets as of any Valuation Date, the book value of receivables for
municipal securities sold as of or prior to such Valuation Date if such
receivables are due within five business days of such Valuation Date.

         "Redemption Price" shall mean the Optional Redemption Price or the
Mandatory Redemption Price, as applicable.

         "Retroactive Taxable Allocation" shall have the meaning set forth in
Section 12 hereof.

         "S&P" shall mean Standard & Poor's Fund, a New York corporation, and
its successors.

         "S&P Discount Factor" shall mean, for purposes of determining the
Discounted Value of any S&P Eligible Asset, the percentage determined by
reference to the rating on such asset and the shortest Exposure Period set forth
opposite such rating that is the same length as or is longer than the S&P
Exposure Period, in accordance with the table set forth below:

<TABLE>
<CAPTION>
                                                             Rating Category
                                                 --------------------------------------
Exposure Period                                    AAA*          AA*          A*           BBB*
- ---------------                                    ---           ---          --           ----

<S>                                                 <C>          <C>          <C>           <C>
40 Business Days..........................          190%         195%         210%          250%
22 Business Days..........................          170          175          190           230
10 Business Days..........................          155          160          175           215
7 Business Days...........................          150          155          170           210
3 Business Days...........................          130          135          150           190
</TABLE>

* S&P rating.

         Notwithstanding the foregoing, (i) the S&P Discount Factor for
short-term municipal securities will be 115%, so long as such municipal
securities are rated A-1+ or SP-1+ by S&P and mature or have a



                                       B-27
<PAGE>


demand feature exercisable within 30 days or less, or 125% if such municipal
securities are not rated by S&P but are rated VMIG-1, P-1 or MIG-1 by Moody's;
provided, however, that any such Moody's rated short-term municipal securities
which have demand features exercisable within 30 days or less must be backed by
a letter of credit, liquidity facility or guarantee from a bank or other
financial institution with a short-term rating of at least A-1+ from S&P; and
further provided that such Moody's rated short-term municipal securities may
comprise no more than 50% of short-term municipal securities that qualify as S&P
Eligible Assets and (ii) no S&P Discount Factor will be applied to cash or to
Receivables for Municipal Securities Sold. For purposes of the foregoing,
Anticipation Notes rated SP1+ or, if not rated by S&P, rated MIG-1 or VMIG-1 by
Moody's, which do not mature or have a demand feature at par exercisable in 30
days and which do not have a long-term rating, shall be considered to be
short-term municipal securities.

                  "S&P Eligible Asset" shall mean cash (excluding any cash
irrevocably deposited by the Fund for the payment of any liabilities within the
mean of APS Basic Maintenance Amount), Receivables for Municipal Securities Sold
or a municipal security owned by the Fund that (i) is interest bearing and pays
interest at least semi-annually; (ii) is payable with respect to principal and
interest in U.S. Dollars; (iii) is publicly rated BBB or higher by S&P or, if
not rated by S&P but rated by Moody's, is rated at least A by Moody's (provided
that such Moody's-rated municipal securities will be included in S&P Eligible
Assets only to the extent the Market Value of such municipal securities does not
exceed 50% of the aggregate Market Value of S&P Eligible Assets; and further
provided that, for purposes of determining the S&P Discount Factor applicable to
any such Moody's-rated municipal security, such municipal security will be
deemed to have an S&P rating which is one full rating category lower than its
Moody's rating); (iv) is not part of a private placement of municipal
securities; and (v) is part of an issue of municipal securities with an original
issue size of at least $20 million or, if an issue with an original issue size
below $20 million (but in no event below $10 million), is issued by an issuer
with a total of at least $50 million of securities outstanding. Solely for
purposes of this definition, the term "municipal securities" means any
obligation the interest on which is exempt from regular Federal income taxation
and which issued by any of the fifty United States, the District of Columbia or
any of the territories of the United States, their subdivisions, counties,
cities, towns, villages, school districts and agencies (including authorities
and special districts created by the states), and federally sponsored agencies
such as local housing authorities. Notwithstanding the foregoing limitations:

                  (1) Municipal securities of any one issuer or guarantor
(excluding bond insurers) shall be considered S&P Eligible Assets only to the
extent the Market Value of such municipal securities does not exceed 10% of the
aggregate Market Value of S&P Eligible Assets provided that 2% is added to the
applicable S&P Discount Factor for every 1% by which the Market Value of such
municipal securities exceeds 5% of the aggregate Market Value of S&P Eligible
Assets;

                  (2) Municipal securities guaranteed or insured by any one bond
insurer shall be considered S&P Eligible Assets only to the extent the Market
Value of such municipal securities does not exceed 25% of the aggregate Market
Value of S&P Eligible Assets; and

                  (3) Long-term municipal securities issued by issuers in any
one state or territory shall be considered S&P Eligible Assets only to the
extent the Market Value of such municipal securities does not exceed 20% of the
aggregate Market Value of S&P Eligible Assets.

                  "S&P Exposure Period" shall mean the maximum period of time
following a Valuation Date that the Fund has under this Certificate of Vote to
cure any failure to maintain, as of such Valuation Date, the Discounted Value
for its portfolio at least equal to the APS Basic Maintenance Amount (as
described in paragraph (a) of Section 9 of this Part I).




                                       B-28
<PAGE>

     "S&P Hedging Transactions" means futures contracts based on the Municipal
Index or Treasury Bonds, put and call options on such contracts purchased by the
Fund and covered call options and secured put options on portfolio securities
written by the Fund.

     "Special Dividend Period," with respect to any series of APS, shall mean
any Subsequent Dividend Period commencing on the date designated by the Fund in
accordance with Section 4 of this Part I and ending on the last day of the last
Dividend Period thereof, with such number of consecutive days or whole years as
the Board of Trustees shall specify, including the terms of any Specific
Redemption Provisions, if any.

     "Specific Redemption Provisions" means, with respect to any Special
Dividend Period of 365 or more days, either, or any combination of, (i) period
(a "Non-Call Period") determined by the Board of Trustees, after consultation
with the Broker-Dealers, during which the shares subject to such Special
Dividend Period are not subject to redemption at the option of the Fund and (ii)
a period (a "Premium Call Period"), consisting of a number of whole years and
determined by the Board of Trustees, after consultation with the Broker-Dealers,
during each year of which the shares subject to such Special Dividend Period
shall be redeemable at the Fund's option at a price per share equal to $50,000
plus accumulated but unpaid dividends plus a premium expressed as a percentage
of $50,000 as determined by the Board of Trustees after consultation with the
Broker-Dealers; provided, that during any Special Dividend Period of 365 or more
days if on the date of determination of the Applicable Rate for such series,
such Applicable Rate equaled or exceeded the Treasury Rate, the Fund may redeem
APS without regard to any Non-Call Period or Premium Call Period at the
Mandatory Redemption Price.

     "Subsequent Dividend Period," with respect to any series of APS, shall mean
the period from and including the first day following the Initial Rate Period
thereof to but excluding the next Dividend Payment Date for such series and any
period thereafter from and including one Dividend Payment Date for such series
to but excluding the next succeeding Dividend Payment Date for such series;
provided, however, that if any Subsequent Dividend Period is also a Special
Dividend Period, such term shall mean the period commencing on the first day of
such Special Dividend Period and ending on the last day of the last Dividend
Period thereof.

     "Substitute Commercial Paper Dealer" shall mean The First Boston Company or
Morgan Stanley & Co. Incorporated or their respective affiliates or successors,
if such entity is a Commercial Paper Dealer; provided that none of such entities
shall be a Commercial Paper Dealer.

     "Substitute U.S. Government Securities Dealer" shall mean The First Boston
Company and Merrill Lynch, Pierce, Fenner & Smith Incorporated or their
respective affiliates or successors, if such entity is a U.S. Government
securities dealer; provide that none of such entities shall be a U.S. Government
Securities Dealer.

     "Treasury Bonds" shall mean United States Treasury Bonds backed by the full
faith and credit of the United States government with remaining maturities of 10
years or more.

     "Treasury Rate," on any date for any Rate Period, shall mean (i) the yield
on the most recently auctioned non-callable direct obligations of the U.S.
Government (excluding "flower" bonds) with a remaining maturity within three
months of the duration of such Rate Period, as quoted in The Wall Street Journal
on such date for the Business Day next preceding such date; or (ii) in the event
that any such rate is not published by The Wall Street Journal, then the
arithmetic average of the yields (expressed as an interest equivalent in the
case of a Rate Period consisting of four Dividend Periods and express as a bond
equivalent in the case of any longer Rate Period) on the most recently auctioned
non-callable direct obligations of the U.S. Government (excluding "flower"
bonds) with a remaining maturity within three




                                       B-29
<PAGE>



months of the duration of such Rate Period as quoted on a discount basis or
otherwise by the U.S. Government Securities Dealers to the Auction Agent for the
close of business on the Business Day immediately preceding such date. If any
U.S. Government Securities Dealer does not quote a rate required to determine
the Treasury Rate, the Treasury Rate shall be determined on the basis of the
quotation or quotations furnished by the remaining U.S. Government Securities
Dealer or U.S. Government Securities Dealers and any Substitute U.S. Government
Securities Dealers selected by the Fund to provide such rate or rates not being
supplied by any U.S. Government Securities Dealer or U.S. Government Securities
Dealers, as the case may be, or, if the Fund does not select any such Substitute
U.S. Government Securities Dealer or Substitute U.S. Government Securities
Dealers, by the remaining U.S. Government Securities Dealer or U.S. Government
Securities Dealers.

         "U.S. Government Securities Dealer" shall mean Goldman, Sachs & Co.,
Lehman Government Securities Incorporated, Smith Barney, Harris Upham & Co. and
Morgan Guaranty Trust Company of New York or their respective affiliates or
successors, if such entity is a U.S. Government securities dealer.

         "Valuation Date" shall mean, for purposes of determining whether the
Fund is maintaining the APS Basic Maintenance Amount and the Minimum Liquidity
Level, each Business Day.

         "Variation Margin" shall mean, in connection with outstanding purchase
or sale positions in futures contracts and outstanding sales positions with
respect to options thereon, the amount of cash and securities paid to and
received from a futures commission merchant (subsequent to the Initial Margin
payment) from time to time as the value of such position fluctuates.

         "Voting Period" shall have the meaning set forth in paragraph (b) of
Section 5 of this Part I.

                                   ARTICLE

B.       Certain Definitions. Capitalized terms not defined in Section 1 of
         this Part II shall have the respective meaning specified in Part I
         hereof. As used in this Part II, the following terms shall have the
         following meanings, unless the context otherwise requires:

            1. "Affiliate" shall mean any Person known to the Auction Agent to
be controlled by, in control of or under common control with the Fund; provided
that no Broker-Dealer controlled by, in control of or under common control with
the Fund shall be deemed to be an Affiliate nor shall any fund or any Person
controlled by, in control of or under common control with such fund one of the
trustees or executive officers of which is also a trustee of the Fund be deemed
to be an Affiliate solely because such trustee or executive officer is also a
trustee of the Fund.

            2. "Agent Member" shall mean a member of or participant in the
Securities Depository that will act on behalf of a Bidder and is identified as
such in such Bidder's Master Purchaser's Letter.

         "Applicable Percentage" for any series of APS on any Auction Date shall
mean the percentage, determined as set forth below, based on the prevailing
rating of such series in effect at the close of business on the Business Day
next preceding such Auction Date.

<Table>
<Caption>
       PREVAILING RATING                                        PERCENTAGE
       -----------------                                        ----------
<S>                                                           <C>
       "aa3"/AA- or higher...............................          110%
       "a3"/A-...........................................          125%
       "baa3"/BBB........................................          150%
       "ba3"/BB-.........................................          200%
       Below "ba3"/BB-...................................          250%
</Table>


                                       B-30
<PAGE>


provided, however, that in the event the Fund has notified the Auction Agent of
its intent to allocate income taxable for federal income tax purposes to the APS
prior to the Auction establishing the Applicable Rate for such shares the
applicable percentage in the foregoing table shall be divided by the quantity 1
minus the maximum marginal regular federal individual income tax rate applicable
to ordinary income or the maximum marginal regular federal corporate income tax
rate, whichever is greater, provided further, however, that the Applicable
Percentage shall be divided in the foregoing manner only to the extent of the
portion of the dividend on the APS for such Rate Period that represents the
allocation of taxable income to the APS.

         For purposes of this definition, the "prevailing rating" of shares of a
series of APS shall be (i) "aa3"/AA- or higher if shares of such series of APS
have a rating of "aa3" or better by Moody's and AA- or better by S&P or the
equivalent of such ratings by such agencies or a substitute rating agency or
substitute rating agencies selected as provided below, (ii) if not "aa3"/AA- or
higher, then "a3"/A- if the shares of such series of APS have a rating of "a3"
or better by Moody's and A- or better by S&P or the equivalent of such ratings
by such agencies or a substitute rating agency or substitute rating agencies
selected as provided below, (iii) if not "aa3 "/AA- or higher or "a3"/A-, then
"baa3"BBB- if the shares of such series of APS have a rating of "baa3" or better
by Moody's and BBB- or better by S&P or the equivalent of such ratings by such
agencies or a substitute rating agency or substitute rating agencies selected as
provided below, (iv) if not "aa3"/AA- or higher, "a3"/A- or "baa3"BBB-, then
"ba3"BB- if the shares of such series of APS have a rating of "ba3" or better by
Moody's and BB- or better by S&P or the equivalent of such ratings by such
agencies or substitute rating agency or substitute rating agencies selected as
provided below, and (v) if not "aa3"/AA- or higher, "a3"/A-, "baa3"BBB- or
"ba3"BB-, then Below "ba3"BB-, provided, however, that if the APS are rated by
only one rating agency, the prevailing rating will be determined without
reference to the rating of any other rating agency. The Fund shall take all
reasonable action necessary to enable either S&P or Moody's to provide a rating
for each series of APS. If neither S&P nor Moody's shall make such a rating
available, Goldman, Sachs & Co. or Smith Barney, Harris Upham & Co. Incorporated
or their successors as Broker-Dealers shall select a nationally recognized
statistical rating organization (as that term is used in the rules and
regulations of the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended from time to time) to act as a substitute
rating agency in respect of the APS and the Fund shall take all reasonable
action to enable such rating agency or agencies to provide a rating for shares
of such series.

         "Available APS" shall have the meaning specified in paragraph (a) of
Section 4 of this Part II.

         "Bid" and "Bids" shall have the respective meanings specified in
paragraph (a) of Section 2 of this Part II.

         "Bidder" and "Bidders" shall have the respective meanings specified in
paragraph (a) of Section 2 of this Part II.

         "Broker-Dealer" shall mean any broker-dealer, commercial bank or other
entity permitted by law to perform the functions required of a Broker-Dealer in
this Part II, that is a member of, or a participant in, the Securities
Depository or is an affiliate of such member or participant, has been selected
by the Fund and has entered into a Broker-Dealer Agreement that remains
effective.

         "Broker-Dealer Agreement" shall mean an agreement between the Auction
Agent and a Broker-Dealer pursuant to which such Broker-Dealer agrees to follow
the procedures specified in this Part II.




                                       B-31
<PAGE>

         "Existing Holder," when used with respect to shares of any series of
APS, shall mean a Person who has signed a Master Purchaser's Letter and is
listed as the beneficial owner of such APS in the records of the Auction Agent.

         "Hold Order" and "Hold Orders" shall have the respective meanings
specified in paragraph (a) of Section 2 of this Part II.

         "Master Purchaser's Letter" shall mean a letter, addressed to the Fund,
the Auction Agent, a Broker-Dealer and an Agent Member in which a Person agrees,
among other things, to offer to purchase, to purchase, to offer to sell and/or
to sell APS as set forth in this Part II.

         "Maximum Rate," for any series of APS on any Auction Date, shall mean:

                         (a) in the case of any Auction Date which is not the
            Auction Date immediately prior to the first day of any proposed
            Special Dividend Period designated by the Fund pursuant to Section 4
            of Part I of the Certificate of Vote, the product of (A) the "AA"
            Composite Commercial Paper Rate on such Auction Date for the next
            Rate Period of such series and (B) the Applicable Percentage on such
            Auction Date, unless such series has or had a Special Dividend
            Period (other than a Special Dividend Period of 28 Rate Period Days
            or less) and an Auction at which Sufficient Clearing Bids existed
            has not yet occurred for a Minimum Dividend Period of such series
            after such Special Dividend Period, in which case the higher of:

         the dividend rate on shares of such series for the then-ending Rate
Period, and

     the product of (1) the higher of (x) the "AA" Composite Commercial Paper
Rate on such Auction Date for the then-ending Rate Period of such series, if
such Rate Period consists of less than four Dividend Periods, or the Treasury
Rate on such Auction Date for such Rate Period, if such Rate Period consists of
four or more Dividend Periods, and (y) the "AA" Composite Commercial Paper Rate
on such Auction Date for such Special Dividend Period of such series, if such
Special Dividend Period consists of less than four Dividend Periods, or the
Treasury Rate on such Auction Date for such Special Dividend Period, if such
Special Dividend Period consists of four or more Dividend Periods and (2) the
Applicable Percentage on such Auction Date; or

     in the case of any Auction Date which is the Auction Date immediately prior
to the first day of any proposed Special Dividend Period designated by the Fund
pursuant to Section 4 of Part I of the Certificate of Vote, the product of (A)
the highest of (1) the "AA" Composite Commercial Paper Rate on such Auction Date
for the then-ending Rate Period of such series, if such Rate Period consists of
less than four Dividend Periods, or the Treasury Rate on such Auction Date for
such Rate Period, if such Rate Period consists of four or more Dividend Periods,
(2) the "AA" Composite Commercial Paper Rate on such Auction Date for the
Special Dividend Period for which the Auction is being held if such Special
Dividend Period consists of less than four Dividend Periods or the Treasury Rate
on such Auction Date for the Special Dividend Period for which the Auction is
being held if such Special Dividend Period consists of four or more Dividend
Periods, and (3) the "AA" Composite Commercial Paper Rate on such Auction Date
for Minimum Dividend Periods and (B) the Applicable Percentage on such Auction
Date.

     "Order" and "Orders" shall have the respective meanings specified in
paragraph (a) of Section 2 of this Part II.


                                       B-32
<PAGE>



         "Outstanding" shall mean, as of any Auction Date with respect to shares
of any series of APS, the number of shares of such series theretofore issued by
the Fund except, without duplication, (i) any shares of such series of APS
theretofore cancelled or delivered to the Auction Agent for cancellation or
redeemed by the Fund or as to which a notice of redemption shall have been given
by the Fund, (ii) any shares of such series of APS as to which the Fund or any
Affiliate thereof shall be an Existing Holder and (iii) any shares of such
series of APS represented by any certificate in lieu of which a new certificate
has been executed and delivered by the Fund.

         "Person" shall mean and include an individual, a partnership, a fund, a
trust, an unincorporated association, a joint venture or other entity or a
government or any agency or political subdivision thereof.

         "Potential Holder," when used with respect to shares of any series of
APS, shall mean any Person, including any Existing Holder of shares of such
series of APS, (i) who shall have executed a Master Purchaser's Letter and (ii)
who may be interested in acquiring shares of such series of APS (or, in the case
of an Existing Holder of shares of such series of APS, additional shares of such
series of APS).

         "Securities Depository" shall mean The Depository Trust Company and its
successors and assigns or any other securities depository selected by the Fund
which agrees to follow the procedures required to be followed by such securities
depository in connection with the APS.

         "Sell Order" and "Sell Orders" shall have the respective meanings
specified in paragraph (a) of Section 2 of this Part II.

         "Submission Deadline" shall mean 1:30 p.m., New York City time, on any
Auction Date or such other time on any Auction Date by which Brokers-Dealers are
required to submit Orders to the Auction Agent as specified by the Auction Agent
from time to time.

         "Submitted Bid" and "Submitted Bids" shall have the respective meanings
specified in paragraph (a) of Section 4 of this Part II.

         "Submitted Hold Order" and "Submitted Hold Orders" shall have the
respective meanings specified in paragraph (a) of Section 4 of this Part IL

         "Submitted Order" and "Submitted Orders" shall have the respective
meanings specified in paragraph (a) of Section 4 of this Part II.

         "Submitted Sell Order" and "Submitted Sell Orders" shall have the
respective meanings specified in paragraph (a) of Section 4 of this Part II.

         "Sufficient Clearing Bids" shall have the meaning specified in
paragraph (a) of Section 4 of this Part 11.

         "Winning Bid Rate" shall have the meaning specified in paragraph (a) of
Section 4 of this Part 11.

               Orders by Existing Holders and Potential Holders. (a) Prior to
the Submission Deadline on each Auction Date:


                  (a) each Existing Holder of shares of any series of APS
         subject to an Auction on such Auction Date may submit to a
         Broker-Dealer by telephone or otherwise information as to:

                                       B-33
<PAGE>

         the number of Outstanding shares, if any, of such series of APS held by
such Existing Holder which such Existing Holder desires to continue to hold
without regard to the Applicable Rate for such series for the next succeeding
Rate Period of such series;

         the number of Outstanding shares, if any, of such series of APS which
such Existing Holder offers to sell if the Applicable Rate for such series for
the next succeeding Rate Period of such series shall be less than the rate per
annum specified by such Existing Holder; and/or

         the number of Outstanding shares, if any, of such series of APS held by
such Existing Holder which such Existing Holder offers to sell without regard to
the Applicable Rate for such series for the next succeeding Rate Period of such
series;

and

         one or more Broker-Dealers, using lists of Potential Holders, shall in
good faith for the purpose of conducting a competitive Auction in a commercially
reasonable manner, contact Potential Holders (by telephone or otherwise),
including Persons that are not Existing Holders, on such lists to determine the
number of shares, if any, of such series of APS which each such Potential Holder
offers to purchase if the Applicable Rate for such series for the next
succeeding Rate Period of such series shall not be less than the rate per annum
specified by such Potential Holder.

For the purposes hereof, the communication to a Broker-Dealer of information
referred to in clause (i)(A), (i)(B), (i)(C) or (ii) of this paragraph (a) is
hereinafter referred to as an "Order" and collectively as "Orders" and each
Existing Holder and each Potential Holder placing an Order is hereinafter
referred to as a "Bidder" and collectively as "Bidders"; an Order containing the
information referred to in clause (i)(A) of this paragraph (a) is hereinafter
referred to as a "Hold Order" and collectively as "Hold Orders"; an Order
containing the information referred to in clause (i)(B) or (ii) of this
paragraph (a) is hereinafter referred to as a "Bid" and collectively as "Bids";
and an Order containing the information referred to in clause (i)(C) of this
paragraph (a) is hereinafter referred to as a "Sell Order" and collectively as
"Sell Orders."

                  2. (i) A bid by an Existing Holder of shares of any series of
APS subject to an Auction on any Auction Date shall constitute an irrevocable
offer to sell:

         the number of Outstanding shares of such series of APS specified in
such Bid if the Applicable Rate for such series determined on such Auction Date
shall be less than the rate specified therein:

         such number or a lesser number of Outstanding shares of such series of
APS to be determined as set forth in clause (iv) of paragraph (a) of Section 5
of this Part II if the Applicable Rate for such series determined on such
Auction Date shall be equal to the rate specified therein; or

         the number of Outstanding shares of such series of APS specified in
such Bid if the rate specified therein shall be higher than the Maximum Rate for
such series, or such number or a lesser number of Outstanding shares of such
series of APS to be determined as set forth in clause (iii) of paragraph (b) of
Section 5 of this Part 11 if the rate specified therein shall be higher than the
Maximum Rate for such series and Sufficient Clearing Bids for such series do not
exist.

               (b) A Sell Order by an Existing Holder of shares of
any series of APS subject to an Auction on any Auction Date shall constitute an
irrevocable offer to sell:



                                       B-34
<PAGE>



                    (i) the number of Outstanding shares of such series of APS
        specified in such Sell Order; or

     such number or a lesser number of Outstanding shares of such series of APS
as set forth in clause (iii) of paragraph (b) of Section 5 of this Part II if
Sufficient Clearing Bids for such series do not exist.

     A Bid by a Potential Holder of shares of any series of APS subject to an
Auction on any Auction Date shall constitute an irrevocable offer to purchase:

     the number of Outstanding shares of such series of APS specified in such
Bid if the Applicable Rate for such series determined on such Auction Date shall
be higher than the rate specified therein; or

     such number or a lesser number of Outstanding shares of such series of APS
as set forth in clause (v) of paragraph (a) of Section 5 of this Part II if the
Applicable Rate for such series determined on such Auction Date shall be equal
to the rate specified therein.

     No Order for any number of shares of any series of APS other than whole
shares shall be valid.

         Submission of Orders by Broker-Dealers to Auction Agent. (a) Each
Broker-Dealer shall submit in writing to the Auction Agent prior to the
Submission Deadline on each Auction Date all Orders for shares of any series of
APS subject to an Auction on such Auction Date obtained by such Broker-Dealer
and shall specify with respect to each Order for such shares:

               (b) the name of the Bidder placing such Order;

     the aggregate number of shares of such series of APS that are the subject
of such Order;

     to the extent that such Bidder is an Existing Holder of shares of such
series of APS:

     the number of shares, if any, of such series of APS subject to any Hold
Order placed by such Existing Holder;

     the number of shares, if any, of such series of APS subject to any Bid
placed by such Existing Holder and the rate specified in such Bid; and

     the number of shares, if any, of such series of APS subject to any Sell
Order placed by such Existing Holder; and

     to the extent such Bidder is a Potential Holder of shares of such series of
APS, the rate and number of shares of such series of APS specified in such
Potential Holder's Bid.

         2. If any rate specified in any Bid contains more than three figures to
the right of the decimal point, the Auction Agent shall round such rate up to
the next highest one thousandth (.001) of 1%.

     If an Order or Orders covering all of the Outstanding shares of any series
of APS held by any Existing Holder is not submitted to the Auction Agent prior
to the Submission Deadline, the Auction Agent shall deem a Hold Order to have
been submitted on behalf of such Existing Holder covering the number of



                                       B-35
<PAGE>



Outstanding shares of such series of APS held by such Existing Holder and not
subject to Orders submitted to the Auction Agent.

     If any Existing Holder submits through a Broker-Dealer to the Auction Agent
one or more Orders covering in the aggregate more than the number of Outstanding
shares of any series of APS subject to an Auction held by such Existing Holder,
such Orders shall be considered valid in the following order of priority:

               (a) all Hold Orders for shares of such series of APS shall be
         considered valid, but only up to and including in the aggregate the
         number of Outstanding shares of such series of APS held by such
         Existing Holder, and if the number of shares of such series of APS
         subject to such Hold Orders exceeds the number of Outstanding shares of
         such series of APS held by such Existing Holder, the number of shares
         subject to each such Hold Order shall be reduced pro rata to cover the
         number of Outstanding shares of such series of APS held by such
         Existing Holder;

     (A) any Bid for shares of such series of APS shall be considered valid up
to and including the excess of the number of Outstanding shares of such series
of APS held by such Existing Holder over the number of shares of such series of
APS subject to any Hold Orders referred to in clause (i) above;

                   (ii) subject to subclause (A), if more than one Bid for
         shares of such series of APS with the same rate is submitted on behalf
         of such Existing Holder and the number of Outstanding shares of such
         series of APS subject to such Bids is greater than such excess, such
         Bids shall be considered valid up to and including the amount of such
         excess, and the number of shares of such series of APS subject to each
         Bid with the same rate shall be reduced pro rata to cover the number of
         shares of such series of APS equal to such excess;

     subject to subclauses (A) and (B), if more than one Bid for shares of such
series of APS with different rates is submitted on behalf of such Existing
Holder, such Bids shall be considered valid in the ascending order of their
respective rates up to and including the amount of such excess; and

     in any such event, the number, if any, of such Outstanding shares of such
series of APS subject to any portion of Bids considered not valid in whole or in
part under the clause (ii) shall be treated as the subject of a Bid for shares
of such series of APS by a Potential Holder at the rate therein specified; and

     all Sell Orders for shares of such series of APS shall be considered valid
up to and including the excess of the number of Outstanding shares of such
series of APS held by such Existing Holder over the sum of the APS subject to
valid Hold Orders referred to in clause (i) above and valid Bids by such
Existing Holder referred to in clause (ii) above.

     If more than one Bid for one or more shares of any series of APS is
submitted on behalf of any Potential Holder, each such Bid submitted shall be a
separate Bid with the rate and number of shares therein specified.

     An Order submitted by a Broker-Dealer to the Auction Agent prior to the
Submission Deadline on any Auction Date shall be irrevocable.




                                       B-36
<PAGE>



         Determination of Sufficient Clearing Bids Winning Bid Rate and
Applicable Rate. (a) Not earlier than the Submission Deadline on each Auction
Date, the Auction Agent shall assemble all valid Orders submitted or deemed
submitted to it by the Broker-Dealers (each such Order as submitted or deemed
submitted by a Broker-Dealer being hereinafter referred to individually as a
"Submitted Hold Order," a "Submitted Bid" or a "Submitted Sell Order;" as the
case may be, or as a "Submitted Order" and collectively as "Submitted Hold
Orders," "Submitted Bids" or "Submitted Sell Orders," as the case may be, or as
"Submitted Orders" and shall for each series of APS for which an Auction is
being held determine:

                  (a) the excess of the number of Outstanding shares of such
         series of APS over the number of Outstanding shares of such series of
         APS subject to Submitted Hold Orders (such excess being hereinafter
         referred to as the "Available APS" of such series);

     from the Submitted Orders for such series whether:

                      (i) the number of Outstanding shares of such series of APS
         subject to Submitted Bids by Potential Holders specifying one or more
         rates equal to or lower than the Maximum Rate for such series exceeds
         or is equal to the sum of

     the number of Outstanding shares of such series of APS subject to Submitted
Bids by Existing Holders specifying one or more rates higher than the Maximum
Rate for such series; and

     the number of Outstanding shares of such series of APS subject to Submitted
Sell Orders

(in the event such excess or such equality exists (other than because the number
of shares of such series of APS in subclauses (B) and (C) above is zero because
all of the Outstanding shares of such series of APS are subject to Submitted
Hold Orders), such Submitted Bids in subclause (A) above being hereinafter
referred to collectively as "Sufficient Clearing Bids" for such series); and

     if Sufficient Clearing Bids for such series exist, the lowest rate
specified in such Submitted Bids (the "Winning Bid Rate" for such series) which
if:

     (I) each such Submitted Bid from Existing Holders specifying such lowest
rate and (II) all other such Submitted Bids from Existing Holders specifying
lower rates were rejected, thus entitling such Existing Holders to continue to
hold the shares of such series of APS that are subject to such Submitted Bids;
and

     (J) each such Submitted Bid from Potential Holders specifying such lowest
rate and (II) all other such Submitted Bids from Potential Holders specifying
lower rates were accepted;

would result in such Existing Holders described in subclause (A) above
continuing to hold an aggregate number of Outstanding shares of such series of
APS which, when added to the number of Outstanding shares of such series of APS
to be purchased by such Potential Holders described in subclause (B) above,
would equal not less than the Available APS of such series.

         2. Promptly after the Auction Agent has made the determinations
pursuant to paragraph (a) of this Section 4, the Auction Agent shall advise the
Fund of the Maximum Rate for each series of APS for which an Auction is being
held on the Auction Date and, based on such determination, the Applicable Rate
for each such series for the next succeeding Rate Period thereof as follows:






                                       B-37
<PAGE>

                  (b) if Sufficient Clearing Bids for such series exist, that
     the Applicable Rate for such series for the next succeeding Rate Period
     thereof shall be equal to the Winning Bid Rate for such series to
     determined;

     if Sufficient Clearing Bids for such series do not exist (other than
because all of the Outstanding shares of such series of APS are subject to
Submitted Hold Orders), that the Applicable Rate for such series for the next
succeeding Rate Period thereof shall be equal to the Maximum Rate for such
series; or

     if all of the Outstanding shares of such series of APS are subject to
Submitted Hold Orders, that the Applicable Rate for such series for the next
succeeding Rate Period thereof shall be equal to the product of (A) (1) the "AA"
Composite Commercial Paper Rate on such Auction Date for such Rate Period, if
such Rate Period consists of less than four Dividend Periods or (II) the
Treasury Rate on such Auction Date for such Rate Period, if such Rate Period
consists of four or more Dividend Periods and (B) 1 minus the maximum marginal
regular federal individual income tax rate applicable to ordinary income or the
maximum marginal regular federal corporate income tax rate, whichever is
greater; provided, however, that if the Fund has notified the Auction Agent of
its intent to allocate to the APS in such Rate Period any net capital gains or
other income taxable for Federal income tax purposes, the Applicable Rate in
respect of that portion of the dividend on the APS for such Rate Period that
represents the allocation of net capital gains or other income taxable for
Federal income tax purposes shall be the rate described in the preceding clause
(A)(I) or (II), as applicable, without being multiplied by the factor set forth
in the preceding clause (B).

         Acceptance and Rejection of Submitted Bids and Submitted Sell Orders
and Allocation of Shares. Existing Holders shall continue to hold the APS that
are subject to Submitted Hold Orders, and, based on the determinations made
pursuant to, paragraph (a) of Section 4 of this Part II, the Submitted Bids and
Submitted Sell Orders shall be accepted or rejected and the Auction Agent shall
take such other action as set forth below:

         1. If Sufficient Clearing Bids for any series of APS have been made,
all Submitted Sell Orders shall be accepted and, subject to the provisions of
paragraphs (d) and (e) of this Section 5, Submitted Bids shall be accepted or
rejected as follows in the following order of priority and all other Submitted
Bids for such series shall be rejected:

                  (a) Existing Holders' Submitted Bids for shares of such series
         of APS specifying any rate that is higher than the Winning Bid Rate for
         such series shall be accepted, thus requiring each such Existing Holder
         to sell the APS subject to such Submitted Bids;

     Existing Holders' Submitted Bids for shares of such series of APS
specifying any rate that is lower than the Winning Bid Rate for such series
shall be rejected, thus entitling each such Existing Holder to continue to hold
the APS subject to such Submitted Bids;

     Potential Holders' Submitted Bids for shares of such series of APS
specifying any rate that is lower than the Winning Bid Rate shall be accepted;

     each Existing Holder's Submitted Bid for shares of such series of APS
specifying a rate that is equal to the Winning Bid Rate for such series shall be
rejected, thus entitling such Existing Holder to continue to hold the APS
subject to such Submitted Bid, unless the number of Outstanding shares of such
series of APS subject to all such Submitted Bids shall be greater than



                                       B-38
<PAGE>



the number of shares of such series of APS ("remaining shares") in the excess of
the Available APS of such series over the number of the APS subject to Submitted
Bids described in clauses (ii) and (iii) of this paragraph (a), in which event
such Submitted Bid of such Existing Holder shall be rejected in part, and such
Existing Holder shall be entitled to continue to hold the APS subject to such
Submitted Bid, but only in an amount equal to the number of shares of such
series of APS obtained by multiplying the number of remaining shares by a
fraction, the numerator of which shall be the number of Outstanding shares of
such series of APS held by such Existing Holder subject to such Submitted Bid
and the denominator of which shall be the aggregate number of Outstanding shares
of such series of APS subject to such Submitted Bids made by all such Existing
Holders that specified a rate equal to the Winning Bid Rate for such series; and

     each Potential Holder's Submitted Bid for shares of such series of APS
specifying a rate that is equal to the Winning Bid Rate for such series shall be
accepted but only in an amount equal to the number of shares of such series of
APS obtained by multiplying the number of shares in the excess of the Available
APS of such series over the number of the APS subject to Submitted Bids
described in clauses (ii) through (iv) of this paragraph (a) by a fraction, the
numerator of which shall be the number of Outstanding shares of such series of
APS subject to such Submitted Bid and the denominator of which shall be the
aggregate number of Outstanding shares of such series of APS subject to such
Submitted Bids made by all such Potential Holders that specified a rate equal to
the Winning Bid Rate for such series; and

     If Sufficient Clearing Bids for any series of APS have not been made (other
than because all of the Outstanding shares of such series of APS are subject to
Submitted Hold Orders), subject to the provisions of paragraph (d) of this
Section 5, Submitted Orders for such series shall be accepted or rejected as
follows in the following order of priority and all other Submitted Bids for such
series shall be rejected:

                  (a) Existing Holders' Submitted Bids for shares of such series
     of APS specifying any rate that is equal to or lower than the Maximum Rate
     for such series shall be rejected, thus entitling such Existing Holders to
     continue to hold the APS subject to such Submitted Bids;

     Potential Holders' Submitted Bids for shares of such series of APS
specifying any rate that is equal to or lower than the Maximum Rate for such
series shall be accepted; and

     Each Existing Holder's Submitted Bid for shares of such series of APS
specifying any rate that is higher than the Maximum Rate of such series and the
Submitted Sell Orders for shares of such series of APS of each Existing Holder
shall be accepted, thus entitling each Existing Holder that submitted any such
Submitted Bid or Submitted Sell Order to sell the shares of such series of APS
subject to such Submitted Bid or Submitted Sell Order, but in both cases only in
an amount equal to the number of shares of such series of APS obtained by
multiplying the number of shares of such series of APS subject to Submitted Bids
described in clause (ii) of this paragraph (b) by a fraction, the numerator of
which shall be the number of Outstanding shares of such series of APS held by
such Existing Holder subject to such Submitted Bid or Submitted Sell Order and
the denominator of which shall be the aggregate number of Outstanding shares of
such series of APS subject to all such Submitted Bids and Submitted Sell Orders.

     If all of the Outstanding shares of any series of APS are subject to
Submitted Hold Orders, all Submitted Bids for such series shall be rejected.

     If, as a result of the procedures described in clause (iv) or (v) of
paragraph (a) or clause (iii) of paragraph (b) of this Section 5, any Existing
Holder would be entitled or required to sell, or any Potential




                                       B-39
<PAGE>


Holder would be entitled or required to purchase, a fraction of a share of APS
of any series on any Auction Date, the Auction Agent shall, in such manner as it
shall determine in its sole discretion, round up or down the number of shares of
such series of APS to be purchased or sold by any Existing Holder or Potential
Holder on such Auction Date as a result of such procedures so that the number of
shares of such series so purchased or sold by each Existing Holder or Potential
Holder on such Auction Date shall be whole shares of APS.

     If, as a result of the procedures described in clause (v) of paragraph (a)
of this Section 5, any Potential Holder would be entitled or required to
purchase less than a whole share of any series of APS on any Auction Date, the
Auction Agent shall, in such manner as it shall determine in its sole
discretion, allocate shares of such series of APS for purchase among Potential
Holders so that only whole shares of such series of APS are purchased on such
Auction Date as a result of such procedures by any Potential Holder, even if
such allocation results in one or more Potential Holders not purchasing the APS
on such Auction Date.

     Based on the results of each Auction for a series of APS, the Auction Agent
shall determine the aggregate number of shares of such series of APS to be
purchased and the aggregate number of shares of such series of APS to be sold by
Potential Holders and Existing Holders on whose behalf each Broker-Dealer
submitted Bids or Sell Orders and, with respect to each Broker-Dealer, to the
extent that such aggregate number of shares to be purchased and such aggregate
number of shares to be sold differ, determine to which other Broker-Dealer or
Broker-Dealers acting for one or more purchasers of shares of such series of APS
such Broker-Dealer shall deliver, or from which other Broker-Dealer or
Broker-Dealers acting for one or more sellers of shares of such series of APS
such Broker-Dealer shall receive, as the case may be, shares of such series of
APS.

                  Notification of Allocations. Whenever the Fund intends to
include any net capital gains or other income taxable for Federal income tax
purposes in any dividend on the APS, the Fund will notify the Auction Agent of
the amount to be so included 15 days prior to the Auction Date on which the
Applicable Rate for such dividend is to be established. Whenever the Auction
Agent receives such notice from the Fund, it will in turn notify each
Broker-Dealer, who, on or prior to such Auction Date, in accordance with its
Broker-Dealer Agreement, will notify its Existing Holders and Potential Holders
believed by it to be interested in submitting an Order in the Auction to be held
on such Auction Date.

                  Miscellaneous. (a) To the extent permitted by applicable law,
the Board of Trustees may interpret or adjust the provisions of this Certificate
of Vote to resolve any inconsistency or ambiguity or to remedy any formal
defect, and may amend this Certificate of Vote with respect to any series of APS
prior to the issuance of such series.

                  2. An Existing Holder may sell, transfer or otherwise dispose
of the APS only in whole shares and only pursuant to a Bid or Sell Order in
accordance with the procedures described in this Part Il or to or through a
Broker-Dealer or to a Person that has delivered a signed copy of a Master
Purchaser's Letter to the Auction Agent; provided, that in the case of all
transfers other than pursuant to Auctions, such Existing Holder, its
Broker-Dealer or its Agent Member advises the Auction Agent of such transfer.

     All of the shares of each series of APS outstanding from time to time shall
be represented by one global certificate registered in the name of the
Securities Depository or its nominee.

     Neither the Fund nor any affiliate thereof may submit an Order in any
Auction, except that any Broker-Dealer that is an affiliate of the Fund may
submit Orders in an Auction, but only if such Orders are not for its own
account.



                                       B-40
<PAGE>




         IN WITNESS WHEREOF, the undersigned has caused this Certificate of Vote
to be executed as of December 5, 1991.


                                              ---------------------
                                              Ronald A. Nyberg
                                              Secretary


State of          )
                  )  ss
County of         )

         Then personally appeared before me Ronald A. Nyberg, who acknowledged
the foregoing instrument to be his free act and deed and the free act and deed
in his capacity as Secretary of Van Kampen Merritt Municipal Trust.

                                              Before me,



                                              Notary public

My commission Expires:
                                              ---------------------



                                       B-41
<PAGE>




                            ARTICLES OF AMENDMENT TO
                       THE CERTIFICATE OF VOTE OF TRUSTEES
                 ESTABLISHING FOUR SERIES OF PREFERRED SHARES OF
                           VAN KAMPEN MUNICIPAL TRUST


         Van Kampen Municipal Trust, a Massachusetts business trust (the "Fund")
certifies to the Secretary of State of the Commonwealth of Massachusetts as
follows:


         FIRST: On October 8, 1998, the Board of Trustees, pursuant to the
provisions of Article VI of the Amended and Restated Declaration of Trust (the
"Declaration of Trust") of the Fund and Section 5 of Part I and Section 7 of
Part 11 of the Certificate of Vote of Trustees Establishing Four Series of
Preferred Shares (the "Certificate of Vote") of the Fund, authorized and
declared a 2-for-1 split of the preferred shares of beneficial Interest of the
Fund, par value $.01 per share, liquidation preference $50,000 per share,
designated, respectively, Auction Preferred Shares, Series A ("APS Series A"),
Auction Preferred Shares, Series B ("APS Series B"), Auction Preferred Shares,
Series C ("APS Series C") and Auction Preferred Shares, Series D ("APB Series
D") (collectively, the APS Series A, APB Series B, APS Series C and APB Series D
are referred to as "APS"). The stock split is to be effected by means of a
division of each outstanding share of APS into two preferred shares of
beneficial interest, par value $.01 per share, liquidation preference $25,000
per share.


         SECOND: Pursuant to the provisions of Article VI of the Declaration of
Trust and Section 5 of Part I and Section 7 of Part II of the Certificate of
Vote, the following amendments to the Certificate of Vote have been duly adopted
and approved by a majority of the Trustees of the Fund.

         (a)      The first paragraph of the vote establishing four series of
                  preferred shares of beneficial interest is hereby amended by
                  replacing such paragraph with the following:

                  First: Pursuant to authority expressly vested in the Board of
                  Trustees of the Fund by Article VI of Its Declaration of Trust
                  (which, as amended or restated from time to time is, together
                  with this Certificate of Vote, herein called the "Declaration
                  of Trust"), the Board of Trustees hereby authorizes the
                  issuance of four series of 12,000 shares of Its authorized
                  preferred shares of beneficial interest, par value $.01 per
                  share ("Preferred Shares"), liquidation preference of $25,000
                  per share, designated, respectively, Auction Preferred Shares,
                  Series A ("APS Series A"), Auction Preferred Shares, Series B
                  ("APB Series B"), Auction Preferred Shares, Series C ("APS
                  Series C") and Auction Preferred Shares, Series D ("APB Series
                  D") (collectively, the APS Series A, APS Series B, APS Series
                  C and APS Series D are referred to as "APB").

                  (b) The first four paragraphs under the heading "DESIGNATION"
of the Certificate of Vote are hereby amended by replacing such paragraphs with
the following:

                  APS SERIES A: A series of 3,000 preferred shares of beneficial
                  interest, $.01 par value, liquidation preference $25,000 per
                  share, is hereby designated "Auction Preferred Shares, Series
                  A" (hereinafter, "APB Series A"). Each share of APS Series A
                  shall be issued on December 10, 1991; have an Applicable Rate
                  for its Initial Dividend Period equal to 4.50% per annum, have
                  an Initial Dividend Payment Date of January 7, 1992; and have
                  such other preferences, limitations and relative voting
                  rights, in addition to those required by applicable law or set
                  forth in the Declaration of Trust applicable to preferred
                  shares of beneficial interest of the Fund, as are set forth in
                  Part I and Part II of this Certificate of Vote. The APS Series
                  A shall constitute a separate series of Preferred Shares of



                                       B-42
<PAGE>

                  beneficial interest of the Fund, and each share of APS Series
                  A shall be Identical except as provided in Section 3 of Part I
                  of this Certificate of Vote.

                  APS SERIES B: A series of 3,000 preferred shares of beneficial
                  Interest, $.01 par value, liquidation preference $25,000 per
                  share, is hereby designated "Auction Preferred Shares, Series
                  B" (hereinafter, "APS Series B"). Each share of APS Series B
                  shall be issued on December 10, 1991; have an Applicable Rate
                  for its Initial Dividend Period equal to 4.50% per annum, have
                  an Initial Dividend Payment Date of January 15, 1992; and have
                  such other preferences, limitations and relative voting
                  rights, In addition to those required by applicable law or set
                  forth in the Declaration of Trust applicable to preferred
                  shares of beneficial interest of the Fund, as are set forth in
                  Part I and Part II of this Certificate of Vote. The APS Series
                  B shall constitute a separate series of Preferred Shares of
                  beneficial interest of the Fund, and each share of APS Series
                  B shall be Identical except as provided in Section 3 of Part I
                  of this Certificate of Vote.

                  APS SERIES C: A series of 3,000 preferred shares of beneficial
                  Interest, $.01 par value, liquidation preference $25,000 per
                  share, is hereby designated "Auction Preferred Shares, Series
                  C" (hereinafter, "APS Series C"). Each share of APS Series C
                  shall be Issued on December 10, 1991; have an Applicable Rate
                  for its Initial Dividend Period equal to 4.50% per annum, have
                  an Initial Dividend Payment Date of January 9, 1992; and have
                  such other preferences, limitations and relative voting
                  rights, in addition to those required by applicable law or set
                  forth In the Declaration of Trust applicable to preferred
                  shares of beneficial interest of the Fund, as are set forth in
                  Part I and Part II of this Certificate of Vote. The APS Series
                  C shall constitute a separate series of Preferred Shares of
                  beneficial interest of the Fund, and each share of APS Series
                  C shall be Identical except as provided in Section 3 of Part I
                  of this Certificate of Vote.

                  APS SERIES D: A series of 3,000 preferred shares of beneficial
                  interest, $.01 par value, liquidation preference $25,000 per
                  share, is hereby designated "Auction Preferred Shares, Series
                  D" (hereinafter, "APS Series D"). Each share of APS Series D
                  shall be Issued on December 10, 1991; have an Applicable Rate
                  for Its Initial Dividend Period equal to 4.50% per annum, have
                  an Initial Dividend Payment Date of January 10, 1992; and have
                  such other preferences, limitations and relative voting
                  rights, In addition to those required by applicable law or set
                  forth in the Declaration of Trust applicable to preferred
                  shares of beneficial interest of the Fund, as are set forth In
                  Part I and Part II of this Certificate of Vote. The APS Series
                  D shall constitute a separate series of Preferred Shares of
                  beneficial interest of the Fund, and each share of APS Series
                  D shall be identical except as provided in Section 3 of Part I
                  of this Certificate of Vote.

                  (c) Section 2(c)(ii) of Part I of the Certificate of Vote is
hereby amended to replace such section with the following:

                  The amount of dividends per share payable on shares of any
                  series of APS on any date on which dividends shall be payable
                  on shares of such series shall be computed by multiplying the
                  respective Applicable Rate in effect for such series in effect
                  for such Dividend Period or Dividend Periods or part thereof
                  for which dividends have not been paid by a fraction, the
                  numerator of which shall be the number of days in such
                  Dividend Period or Dividend Periods or part thereof and the
                  denominator of which shall be 365 if such Dividend Period is a
                  Rate Period, or is contained in a Rate Period, of less that
                  one year and 360 for all other Dividend Periods, and applying
                  the rate obtained against $25,000.




                                       B-43
<PAGE>


                  (d) Section 3(a)(i) of Part I of the Certificate of Vote is
hereby amended to replace such section with the following:

                  After the Initial Dividend Period with respect to any series
                  of APB and upon giving a Notice of Redemption, as provided
                  below, the Fund at its option may redeem shares of any series
                  of APS, in whole or in part, on the second Business Day next
                  preceding any Dividend Payment Date applicable to those shares
                  of APS called for redemption, out of funds legally available
                  therefor, at the Optional Redemption Price; provided that
                  during a Special Dividend Period of 365 days or more no share
                  of APS will be subject to optional redemption during any
                  Non-Call Period; provided, that shares of any series of APS
                  may not be redeemed in part of any such partial redemption
                  fewer than 500 shares of such series remain outstanding.

                  (e) Section 5(g) of Part I of the Certificate of Vote is
hereby amended to replace such section with the following:

                  Right to Vote with Respect to Certain Other Matters. If the
                  Fund has more than one series of APB outstanding, the
                  affirmative vote of the holders of a majority (unless a higher
                  percentage vote is required under the Declaration of Trust or
                  under this Certificate of Vote) of the outstanding shares of
                  each series of APB, each voting as a separate class, is
                  required with respect to any matter that materially affects
                  the series In a manner different from that of other. series of
                  classes of the Fund's shares, including without limitation any
                  proposal to do the following: (1) increase or decrease the
                  aggregate number of authorized shares of the series; (2)
                  effect any exchange, reclassification, or cancellation of all
                  or part of the shares of the series; (3) effect an exchange,
                  or create a right of exchange, of all or any part of the
                  shares of the series; (4) change the rights or preferences of
                  the shares of the series; (5) change the shares of the series,
                  whether with or without par value, of the same or another
                  class or series; (6) create a new class or series of shares
                  having rights and preferences prior and superior to the shares
                  of the series, or Increase the rights and preferences or the
                  number of authorized shares of a series having rights and
                  preferences prior or superior to the shares of the series; or
                  (7) cancel or otherwise affect distributions on the shares of
                  the series that have accrued but have not been declared. To
                  the extent that the interest of a series of APB affected by a
                  matter are substantially identical to the Interests of another
                  series of APS affected by such matter (e.g., a vote of
                  shareholders required under Section 13(a) of the 1940 Act),
                  each such series shall vote together collectively as one
                  class. The vote of holders of each series of APS described
                  above will in each case be in addition to a separate vote of
                  the requisite percentage of Common Shares and APS necessary to
                  authorize the action in question.

                  (f) Section 6(a) of Part I of the Certificate of Vote is
hereby amended to replace such section with the following:

                  Upon the dissolution, liquidation or winding up of the affairs
                  of the Fund, whether voluntary or Involuntary, the Holders of
                  the APS then outstanding shall be entitled to receive and to
                  be paid out of the assets of the Fund available for
                  distribution to its shareholders, before any payment or
                  distribution shall be made on the Common Shares or on any
                  other class of shares of the Fund ranking junior to the APS
                  upon dissolution, liquidation or winding up, an amount equal
                  to the liquidation preference with respect to such shares. The
                  liquidation preference for the APS shall be $25,000 per share,
                  plus an amount equal to all dividends thereon (whether or not
                  earned or declared) accumulated but unpaid to the date of
                  final distribution In same-day funds, together with any
                  payments



                                       B-44
<PAGE>


                  required to be made pursuant to Section 12 in connection with
                  the liquidation of the Fund.

                  (g) Section 15(f) of Part I of the Certificate of Vote is
hereby amended to replace such section with the following:

                  "APB Basic Maintenance Amount," as of any Valuation Date,
                  shall mean the dollar amount equal to the sum of (i)(A) the
                  product of the number of APS Outstanding on such date
                  multiplied by $25,000; (B) the aggregate amount of dividends
                  that will have accumulated at the Applicable Rate (whether or
                  not earned or declared) to (but not Including) the first
                  respective Dividend Payment Dates for each of the APS
                  Outstanding that follow such Valuation Date; (C) the amount
                  equal to the Projected Dividend Amount (based on the number of
                  APS Outstanding on such date); (D) the amount of anticipated
                  expenses of the Fund for the 90 days subsequent to such
                  Valuation Date; (E) the amount of the Fund's Maximum Potential
                  Additional Dividend Liability as of such Valuation Dale; (F)
                  the amount of any premium payable pursuant to a Premium Call
                  Period; and (G) any current liabilities as of such Valuation
                  Date to the extent not reflected in any of (i)(A) through
                  (i)(F) (including, without limitation, any amounts described
                  in Section 13 of Part I as required to be treated as
                  liabilities in connection with the Fund's transactions in
                  futures and options and including any payables for municipal
                  securities purchased as of such Valuation Date) less (ii)
                  either (A) the face value of any of the Fund's assets
                  Irrevocably deposited by the Fund for the payment of any of
                  (i)(A) thorough (i)(G) if such assets mature within the
                  Moody's Exposure Period and are either securities issued or
                  guaranteed by the United States Government or have a rating
                  assigned by Moody's of P1, VMIG-1 or MIG-1 (or, with respect
                  to S&P, SP-1+ or A-1+) or (B) the Discounted Value of such
                  assets. For purposes of the APS Basic Maintenance Amount In
                  connection with S&P's ratings of the APS, with respect to any
                  transactions by the Fund in futures contracts, the Fund shall
                  include as liabilities (i) 30% of the aggregate settlement
                  value, as marked to market, of any outstanding futures
                  contracts based on the Municipal Index which are owned by the
                  Fund plus (ii) 25% of the aggregate settlement value, as
                  marked to market, of any outstanding futures contracts based
                  on Treasury Bonds which contracts are owned by the Fund. For
                  purposes of the APB Basic Maintenance Amount In connections
                  with Moody's rating of the APS, with respect to any
                  transactions by the Fund in securities options, the Fund shall
                  include as liabilities (i) 10% of the exercise price of a call
                  option written by the Fund and (ii) the exercise price of any
                  written put option.

                  (h) Section 15(ii) of Part I of the Certificate of Vote is
hereby amended to replace such section with the following:

                  "Mandatory Redemption Price" means $25,000 per share of APB
                  plus an amount equal to accumulated but unpaid dividends
                  thereon to the date fixed for redemption (whether or not
                  earned or declared).

                  (i) Section 15(yy) of Part I of the Certificate of Vote is
hereby amended to replace such section with the following:

                  "Optional Redemption Price" shall mean (i) $25,000 per share
                  of APB in the case of a 7 day or 26-day Dividend Period or a
                  Special Dividend Period of less than 365 days or (ii) with
                  respect to a Special Dividend Period of 365 days or more the
                  Optional Redemption Price set forth in the Specific Redemption
                  Provisions in connection therewith; in each



                                       B-45
<PAGE>



                  case plus an amount equal to accumulated but unpaid dividends
                  thereon to the date of redemption (whether or not earned or
                  declared).

                  (j) Section 15(ppp) of Part I of the Certificate of Vote is
hereby amended to replace such section with the following:

                  "Specific Redemption Provisions" means, with respect to any
                  Special Dividend Period of 365 or more days, either, or any
                  combination of, (i) a period (a "Non-Call Period") determined
                  by the Board of Trustees, after consultation with the
                  Broker-Dealers, during which the shares subject to such
                  Special Dividend Period are not subject to redemption at the
                  option of the Fund, and (ii) a period (a "Premium Cell
                  Period"), consisting of a number of whole years and determined
                  by the Board of Trustees, after consultation within the
                  Broker-Dealers, during each year of which the shares subject
                  to such Special Dividend Period shall be redeemable at the
                  Fund's option at a price per share equal to $25,000 plus
                  accumulated by unpaid dividends plus a premium expressed as a
                  percentage of $25,000 as determined but the Board of Trustees
                  after consultation with the Broker-Dealers; provided, that
                  during any Special Dividend Period of 365 or more days if, on
                  the date of determination of the Applicable Rate for such
                  series, such Applicable Rate equaled or exceeded the Treasury
                  Rate, the Fund may redeem APB without regard to any Non-Call
                  Period or Premium Call Period at the Mandatory Redemption
                  Price.



                                       B-46
<PAGE>
                            ARTICLES OF AMENDMENT TO
                       THE CERTIFICATE OF VOTE OF TRUSTEES
                           ESTABLISHING FOUR SERIES OF
                               PREFERRED SHARES OF
                           VAN KAMPEN MUNICIPAL TRUST

                  Van Kampen Municipal Trust, a Massachusetts business trust
(the "Fund"), certifies to the Secretary of State of the Commonwealth of
Massachusetts as follows:

                  FIRST: On October 8, 1998, the Board of Trustees, pursuant to
the provisions of Article VI of the Amended and Restated Declaration of Trust
(the "Declaration of Trust") of the Fund and Section 5 of Part I and Section 7
of Part II of the Certificate of Vote of Trustees Establishing Four Series of
Preferred Shares (the "Certificate of Vote") of the Fund, authorized and
declared a 2-for-1 split of the preferred shares of beneficial interest of the
Fund, par value $.01 per share, liquidation preference $50,000 per share,
designated, respectively, Auction Preferred Shares, Series A ("APS Series A"),
Auction Preferred Shares, Series B ("APS Series B"), Auction Preferred Shares,
Series C ("APS Series C") and Auction Preferred Shares, Series D ("APS Series
D") (collectively, the APS Series A, APS Series B, APS Series C and APS Series D
are referred to as "APS"). The stock split is to be effected by means of a
division of each outstanding share of APS into two preferred shares of
beneficial interest, par value $.01 per share, liquidation preference $25,000
per share.

                  SECOND: Pursuant to the provisions of Article VI of the
Declaration of Trust and Section 5 of Part I and Section 7 of Part II of the
Certificate of Vote, the following amendments to the Certificate of Vote have
been duly adopted and approved by a majority of the Trustees of the Fund.

         (a)      The first paragraph of the vote establishing four series of
                  preferred shares of beneficial interest is hereby amended by
                  replacing such paragraph with the following:

                  First: Pursuant to authority expressly vested in the Board of
                  Trustees of the Fund by Article VI of its Declaration of Trust
                  (which, as amended or restated from time to time is, together
                  with this Certificate of Vote, herein called the "Declaration
                  of Trust"), the Board of Trustees hereby authorizes the
                  issuance of four series of 12,000 shares of its authorized
                  preferred shares of beneficial interest, par value $.01 per
                  share ("Preferred Shares"), liquidation preference of $25,000
                  per share, designated, respectively, Auction Preferred Shares,
                  Series A ("APS Series A"), Auction Preferred Shares, Series B
                  ("APS Series B"), Auction Preferred Shares, Series C ("APS
                  Series C") and Auction Preferred Shares, Series D



                                      B-47
<PAGE>
                  ("APS Series D") (collectively, the APS Series A, APS Series
                  B, APS Series C and APS Series D are referred to as "APS").

         (b)      The first four paragraphs under the heading "DESIGNATION" of
                  the Certificate of Vote are hereby amended by replacing such
                  paragraphs with the following:.

                  APS SERIES A: A series of 3,000 preferred shares of beneficial
                  interest, $.01 par value, liquidation preference $25,000 per
                  share, is hereby designated Auction Preferred Shares, Series
                  A" (hereinafter, "APS Series A"). Each share of APS Series A
                  shall be issued on December 10, 1991; have an Applicable Rate
                  for its Initial Dividend Period equal to 4.50% per annum, have
                  an Initial Dividend Payment Date of January 7, 1992; and have
                  such other preferences, limitations and relative voting
                  rights, in addition to those required by applicable law or set
                  forth in the Declaration of Trust applicable to preferred
                  shares of beneficial interest of the Fund, as are set forth in
                  Part I and Part 11 of this Certificate of Vote. The APS Series
                  A shall constitute a separate series of Preferred Shares of
                  beneficial interest of the Fund, and each share of APS Series
                  A shall be identical except as provided in Section 3 of Part 1
                  of this Certificate of Vote.

                  APS SERIES B: A series of 3,000 preferred shares of beneficial
                  interest, $.01 par value, liquidation preference $25,000 per
                  share, is hereby designated "Auction Preferred Shares, Series
                  B" (hereinafter, "APS Series B"). Each share of APS Series B
                  shall be issued on December 10, 1991; have an Applicable Rate
                  for its Initial Dividend Period equal to 4.50% per annum, have
                  an Initial Dividend Payment Date of January 15, 1992; and have
                  such other preferences, limitations and relative voting
                  rights, in addition to those required by applicable law or set
                  forth in the Declaration of Trust applicable to preferred
                  shares of beneficial interest of the Fund, as are set forth in
                  Part I and Part II of this Certificate of Vote. The APS Series
                  B shall constitute a separate series of Preferred Shares of
                  beneficial interest of the Fund, and each share of APS Series
                  B shall be identical except as provided in Section 3 of Part I
                  of this Certificate of Vote.

                  APS SERIES C: A series of 3,000 preferred shares of beneficial
                  interest, $.01 par value, liquidation preference $25,000 per
                  share, is hereby designated "Auction Preferred Shares, Series
                  C" (hereinafter, "APS Series C"). Each share of APS Series C
                  shall be issued on December 10, 1991; have an Applicable Rate
                  for its initial Dividend Period equal to 4.50% per annum, have
                  an Initial Dividend Payment Date of January 9, 1992; and have
                  such other preferences, limitations and relative voting
                  rights, in addition to those required by applicable law or set
                  forth in the Declaration of Trust applicable to preferred
                  shares of beneficial interest of the Fund, as are set forth in
                  Part I and Part II of this Certificate of Vote. The APS Series
                  C shall constitute a separate series of Preferred Shares of
                  beneficial


                                      B-48
<PAGE>
                  interest of the Fund, and each share of APS Series C shall be
                  identical except as provided in Section 3 of Part I of this
                  Certificate of Vote.

                  APS SERIES D: A series of 3,000 preferred shares of beneficial
                  interest, $.01 par value, liquidation preference $25,000 per
                  share, is hereby designated "Auction Preferred Shares, Series
                  D" (hereinafter, "APS Series D"). Each share of APS Series D
                  shall be issued on December 10, 1991; have an Applicable Rate
                  for Its Initial Dividend Period equal to 4.50% per annum, have
                  an Initial Dividend Payment Date of January 10, 1992; and have
                  such other preferences, limitations and relative voting
                  rights, in addition to those required by applicable law or set
                  forth in the Declaration of Trust applicable to preferred
                  shares of beneficial interest of the Fund, as are set forth in
                  Part 1 and Part 11 of this Certificate of Vote. The APS Series
                  D shall constitute a separate series of Preferred Shares of
                  beneficial interest of the Fund, and each share of APS Series
                  D shall be identical except as provided in Section 3 of Part I
                  of This Certificate of Vote.

         (c)      Section 2 (c)(ii) of Part 1 of the Certificate of Vote is
                  hereby amended to replace such section with the following:

                  The amount of dividends per share payable on shares of any
                  series of APS on any date on which dividends shall be payable
                  on shares of such series shall be computed by multiplying the
                  respective Applicable Rate in effect for such series in effect
                  for such Dividend Period or Dividend Periods or part thereof
                  for which dividends have not been paid by a fraction, the
                  numerator of which shall be the number of days in such
                  Dividend Period or Dividend Periods or part thereof and the
                  denominator of which shall be 365 if such Dividend Period is a
                  Rate Period, or is contained in a Rate Period, of less that
                  one year and 360 for all other Dividend Periods, and applying
                  the rate obtained against $25,000.

         (d)      Section 3 (a)(i) of Part I of the Certificate of Vote is
                  hereby amended to replace such section with the following:

                  After the Initial Dividend Period with respect to any series
                  of APS and upon giving a Notice of Redemption, as provided
                  below, the Fund at its option may redeem shares of any series
                  of APS, in whole or in part, on the second Business Day next
                  preceding any Dividend Payment Date applicable to those shares
                  of APS called for redemption, out of funds legally available
                  therefor, at the Optional Redemption Price; provided that
                  during a Special Dividend Period of 365 days or more no share
                  of APS will be subject to optional redemption during any
                  Non-Call Period; provided, that shares of any series of APS
                  may not be redeemed in part of any such partial redemption
                  fewer than 500 shares of such series remain outstanding.



                                      B-49
<PAGE>
         (e)      Section 5 (g) of Part I of the Certificate of Vote is hereby
                  amended to replace such section with the following:

                           Right to Vote with Respect to Certain Other Matters.
                  If the Fund has more than one series of APS outstanding, the
                  affirmative vote of the holders of a majority (unless a higher
                  percentage vote is required under the Declaration of Trust or
                  under this Certificate of Vote) of the outstanding shares of
                  each series of APS, each voting as a separate class, is
                  required with respect to any matter that materially affects
                  the series in a manner different from that of other series of
                  classes of the Fund's shares, including without limitation any
                  proposal to do the following: (1) increase or decrease the
                  aggregate number of authorized shares of the series; (2)
                  effect any exchange, reclassification, or cancellation of all
                  or part of the shares of the series; (3) effect an exchange,
                  or create a right of exchange, of all or any part of the
                  shares of the series; (4) change the rights or preferences of
                  the shares of the series; (5) change the shares of the series,
                  whether with or without par value, of the same or another
                  class or series; (6) create a new class or series of shares
                  having rights and preferences prior and superior to the shares
                  of the series, or increase the rights and preferences or the
                  number of authorized shares of a series having rights and
                  preferences prior or superior to the shares of the series; or
                  (7) cancel or otherwise affect distributions on the shares of
                  the series that have accrued but have not been declared. To
                  the extent that the interest of a series of APS affected by a
                  matter are substantially identical to the interests of another
                  series of APS affected by such matter (e.g., a vote of
                  shareholders required under Section 13(a) of the 1940 Act),
                  each such series shall vote together collectively as one
                  class. The vote of holders of each series of APS described
                  above will in each case be in addition to a separate vote of
                  the requisite percentage of Common Shares and APS necessary to
                  authorize the action in question.


         (f)      Section 6 (a) of Part I of the Certificate of Vote is hereby
                  amended to replace such section with the following:


                  Upon the dissolution, liquidation or winding up of the affairs
                  of the Fund, whether voluntary or involuntary, the Holders of
                  the APB then outstanding shall be entitled to receive and to
                  be paid out of the assets of the Fund available for
                  distribution to its shareholders, before any payment or
                  distribution shall be made on the Common Shares or on any
                  other class of shares of the Fund ranking junior to the APB
                  upon dissolution, liquidation or winding up, an amount equal
                  to the liquidation preference with respect to such shares. The
                  liquidation preference for the APB shall be $25,000 per share,
                  plus an amount equal to all dividends thereon (whether or not
                  earned or declared) accumulated but unpaid to the date of
                  final distribution in same-day funds, together with any
                  payments required to be made pursuant to Section 12 in
                  connection with the liquidation of the Fund.



                                      B-50
<PAGE>
         (g)      Section 15 (t) of Part I of the Certificate of Vote is hereby
                  amended to replace such section with the following:

                  "APB Basic Maintenance Amount," as of any Valuation Date,
                  shall mean the dollar amount equal to the sum of (i)(A) the
                  product of the number of APB Outstanding on such date
                  multiplied by $25,000; (B) the aggregate amount of dividends
                  that will have accumulated at the Applicable Rate (whether or
                  not earned or declared) to (but not including) the first
                  respective Dividend Payment Dates for each of the APB
                  Outstanding that follow such Valuation Date; (C) the amount,
                  equal to the Projected Dividend Amount (based on the number of
                  APB Outstanding on such date); (D) the amount of anticipated
                  expenses of the Fund for the 90 days subsequent to such
                  Valuation Date; (E) the amount of the Fund's Maximum Potential
                  Additional Dividend Liability as of such Valuation Date; (F)
                  the amount of any premium payable pursuant to a Premium Call
                  Period; and (G) any current liabilities as of such Valuation
                  Date to the extent not reflected in any of (i)(A) through
                  (i)(F) (including, without limitation, any amounts described
                  in Section 13 of Part I as required to be treated as
                  liabilities in connection with the Fund's transactions in
                  futures and options and including any payables for municipal
                  securities purchased as of such Valuation Date) less (ii)
                  either (A) the face value of any of the Fund's assets
                  irrevocably deposited by the Fund for the payment of any of
                  (i)(A) thorough (i)(G) if such assets mature within the
                  Moody's Exposure Period and are either securities issued or
                  guaranteed by the United States Government or have a rating
                  assigned by Moody's of P-1, VMIG-1 or MIG-1 (or, with respect
                  to S&P, SP-1+ or A-1+) or (B) the Discounted Value of such
                  assets. For purposes of the APB Basic Maintenance Amount In
                  connection with S&P's ratings of the APB, with respect to any
                  transactions by the Fund in futures contracts, the Fund shall
                  include as liabilities (i) 30% of the aggregate settlement
                  value, as marked to market, of any outstanding futures
                  contracts based on the Municipal Index which are owned by the
                  Fund plus (ii) 25% of the aggregate settlement value, as
                  marked to market, of any outstanding futures contracts based
                  on Treasury Bonds which contracts are owned by the Fund. For
                  purposes of the APB Basic Maintenance Amount in connections
                  with Moody's rating of the APB, with respect to any
                  transactions by the Fund in securities options, the Fund shall
                  include as liabilities (i) 10% of the exercise price of a call
                  option written by the Fund and (ii) the exercise price of any
                  written put option.

         (h)      Section 15 (ii) of Part l of the Certificate of Vote is hereby
                  amended to replace such section with the following:

                  "Mandatory Redemption Price" means $25,000 per share of APS
                  plus an amount equal to accumulated but unpaid dividends
                  thereon to the date fixed for redemption (whether or not
                  earned or declared).




                                      B-51
<PAGE>
         (i)      Section 15 (yy) of Part I of the Certificate of Vote is hereby
                  amended to replace such section with the following:

                  "Optional Redemption Price" shall mean (i) $25,000 per share
                  of APS in the case of a 7-day or 28-day Dividend Period or a
                  Special Dividend Period of less than 365 days or (ii) with
                  respect to a Special Dividend Period of 365 days or more the
                  Optional Redemption Price set forth in the Specific Redemption
                  Provisions in connection therewith; in each case plus an
                  amount equal to accumulated but unpaid dividends thereon to
                  the date of redemption (whether or not earned or declared).

         (j)      Section 15 (ppp) of Part I of the Car Certificate of Vote is
                  hereby amended to replace such section with the following:


                  "Specific Redemption Provisions" means, with respect to any
                  Special Dividend Period of 365 or more days, either, or any
                  combination of, (i) a period (a "Non-Call Period") determined
                  by the Board of Trustees, after consultation with the
                  Broker-Dealers, during which the shares subject to such
                  Special Dividend Period are not subject to redemption at the
                  option of the Fund, and (H) a period. (a "Premium Call
                  Period"), consisting of a number of whole years and determined
                  by the Board of Trustees, after consultation within the
                  Broker-Dealers, during each year of which the shares subject
                  to such Special Dividend Period shall be redeemable at the
                  Fund's option at a price per share equal to $25,000 plus
                  accumulated by unpaid dividends plus a premium expressed as a
                  percentage of $25,000 as determined but the Board of Trustees
                  after consultation with the Broker-Dealers; provided, that
                  during any Special Dividend Period of 365 or more days if, on
                  the date of determination of the Applicable Rate for such
                  series, such Applicable Rate equaled or exceeded the Treasury
                  Rate, the Fund may redeem APS without regard to any Non-Call
                  Period or Premium Call Period at the Mandatory Redemption
                  Price.




                                      B-52
<PAGE>





                            ARTICLES OF AMENDMENT TO
                       THE CERTIFICATE OF VOTE OF TRUSTEES
              CHANGING THE TIME WHEN THE FUND MUST DELIVER A LETTER
                FROM AN INDEPENDENT ACCOUNTANT TO RATING AGENCIES


         Van Kampen Municipal Trust, a Massachusetts business trust (the
"Fund"), certifies to the Secretary of State of the Commonwealth of
Massachusetts as follows:


         FIRST: On September 25, 2003, the Board of Trustees of the Fund,
pursuant to the provisions of Article VI of the Amended and Restated Declaration
of Trust (the "Declaration of Trust") of the Fund and Section 5 of Part I of the
Certificate of Vote of Trustees Establishing a Class of Preferred Shares (the
"Certificate of Vote") of the Fund, authorized an amendment to the Certificate
of Vote to change the timing of filing certain reports with rating agencies from
quarterly to annually and to make conforming changes to the Certificate of Vote.


         SECOND: Pursuant to the provisions of Article VI of the Declaration of
Trust and Section 5 of Part I of the Certificate of Vote of the Fund, the
following amendments to the Certificate of Vote have been duly adopted and
approved by a majority of the Trustees of the Fund.

         1.       Section 5 (d) (ii) of Part I of the Certificate of Vote is
                  hereby amended to replace the term "Quarterly Valuation Date"
                  with the term "Annual Valuation Date."

         2.       The second and third sentences of Section 9(b) of Part I of
                  the Certificate of Vote are hereby amended to replace such
                  sentences with the following:

                  The Fund shall also deliver to S&P (if S&P is then rating the
                  APS), Moody's (if Moody's is then rating the APS) and the
                  Auction Agent (if either S&P or Moody's is then rating the
                  APS) an APS Basic Maintenance Report as of the last Valuation
                  Date of each month on or before the third Business Day after
                  such day. The Fund shall also deliver to S&P (if S&P is then
                  rating the APS) and Moody's (if Moody's is then rating the
                  APS) an APS Basic Maintenance Report whenever (i) the Fund
                  shall have redeemed APS or Common Shares, (ii) the Fund shall
                  fail to have S&P Eligible Assets or Moody's Eligible Assets
                  with an aggregate Discounted Value at least equal to 105% of
                  the APS Basic Maintenance Amount, or (iii) whenever requested
                  by Moody's or S&P, in each case on or before the third
                  Business Day after such day.

         3.       Section 9 (c) of Part I of the Certificate of Vote is hereby
                  amended to replace such section with the following:

                  Within ten Business Days after the date of delivery of an APS
                  Basic Maintenance Report in accordance with paragraph (b) of
                  this Section 9 relating to an Annual Valuation Date, the Fund
                  shall cause the Independent Accountant to confirm in writing
                  to S&P (if S&P is then rating the APS), Moody's (if Moody's is
                  then rating the APS) and the Auction Agent (if either S&P or
                  Moody's is then rating the APS) (i) the mathematical accuracy
                  of the calculations reflected in such Report and (ii) that, in
                  such Report, the Fund determined in accordance with this
                  Certificate of Vote whether the Fund had, at such Annual
                  Valuation Date, S&P Eligible Assets (if S&P is then rating the
                  APS) of an aggregate Discounted Value at least equal to the
                  APS Basic Maintenance Amount and Moody's Eligible Assets (if
                  Moody's is then rating the APS) of an aggregate Discounted
                  Value at least equal to the APS Basic Maintenance Amount (such
                  confirmation being herein called the "Accountant's
                  Confirmation").



                                       B-53
<PAGE>

         4.       The final clause of Section 13 (a) (i) of Part I of the
                  Certificate of Vote, which read "there shall be a quarterly
                  audit made of the Fund's futures and options transactions by
                  the Fund's independent accountants to confirm that the Fund is
                  in compliance with these standards; or" is hereby amended to
                  replace such clause with the following:

                  there shall be an annual audit made of the Fund's futures and
                  options transactions by the Fund's independent accountants to
                  confirm that the Fund is in compliance with these standards;
                  or

         5.       Section 15 (h) of Part I of the Certificate of Vote is hereby
                  amended to replace such section with the following:

                  "APS Basic Maintenance Report" shall mean a report signed by
                  any of the President, Treasurer, any Senior Vice President or
                  any Vice President of the Fund which sets forth, as of the
                  related Valuation Date, the assets of the Fund, the Market
                  Value and the Discounted Value thereof (seriatim and in
                  aggregate), the APS Basic Maintenance Amount, the net asset
                  value and market trading price per Common Share, and the total
                  return percentage for the relevant valuation period.

         6.       Section 15 (ddd) of Part I of the Certificate of Vote is
                  hereby amended to replace such section with the following:

                  "Annual Valuation Date" shall mean the last Business Day of
                  each fiscal year of the Fund.

         IN WITNESS WHEREOF, the undersigned has caused this Certificate of Vote
to be executed as of March 8, 2004.




                                              /s/ A. Thomas Smith III
                                              ----------------------------
                                              A. Thomas Smith III
                                              Vice President and Secretary


State of New York    )
                     )  ss
County of New York   )

         Then personally appeared before me A. Thomas Smith III, who
acknowledged the foregoing instrument to be his free act and deed and the free
act and deed in his capacity as Vice President and Secretary of Van Kampen
Municipal Trust.

                                              Before me,


                                              /s/ Rosemarie Costagliola
                                              ----------------------------
                                              Notary Public

My Commission expires 11/9/06


                                      B-54
<PAGE>








                                   APPENDIX C

              ACQUIRING FUND ANNUAL REPORT DATED OCTOBER 31, 2004








                                       C-1
<PAGE>



Item 1.  Reports to Shareholders.

The Trust's annual report transmitted to shareholders pursuant to Rule 30e-1
under the Investment Company Act of 1940 is as follows:


       Welcome, Shareholder

       In this report, you'll learn about how your investment in Van Kampen
       Municipal Trust performed during the annual period. The portfolio
       management team will provide an overview of the market conditions and
       discuss some of the factors that affected investment performance during
       the reporting period. In addition, this report includes the trust's
       financial statements and a list of trust investments as of October 31,
       2004.

       MARKET FORECASTS PROVIDED IN THIS REPORT MAY NOT NECESSARILY COME TO
       PASS. THERE IS NO ASSURANCE THAT THE TRUST WILL ACHIEVE ITS INVESTMENT
       OBJECTIVE. TRUSTS ARE SUBJECT TO MARKET RISK, WHICH IS THE POSSIBILITY
       THAT THE MARKET VALUES OF SECURITIES OWNED BY THE TRUST WILL DECLINE AND
       THAT THE VALUE OF TRUST SHARES MAY THEREFORE BE LESS THAN WHAT YOU PAID
       FOR THEM. ACCORDINGLY, YOU CAN LOSE MONEY INVESTING IN THIS TRUST.

       INCOME MAY SUBJECT CERTAIN INDIVIDUALS TO THE FEDERAL ALTERNATIVE MINIMUM
       TAX (AMT).

<Table>
<Caption>
         <S>                    <C>                                       <C>
         ---------------------------------------------------------------------------------------
            NOT FDIC INSURED             OFFER NO BANK GUARANTEE              MAY LOSE VALUE
         ---------------------------------------------------------------------------------------
                   NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY               NOT A DEPOSIT
         ---------------------------------------------------------------------------------------
</Table>



                                      C-2
<PAGE>



Performance Summary as of 10/31/04

<Table>
<Caption>
MUNICIPAL TRUST
SYMBOL: VKQ
- ---------------------------------------------------------
AVERAGE ANNUAL                   BASED ON      BASED ON
TOTAL RETURNS                      NAV       MARKET PRICE
<S>                              <C>         <C>

Since Inception (9/27/91)         7.81%         6.93%

10-year                           8.36          8.03

5-year                            9.46          9.32

1-year                            9.03          9.15
- ---------------------------------------------------------
</Table>

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES
SHOWN. FOR THE MOST RECENT MONTH-END PERFORMANCE FIGURES, PLEASE VISIT
VANKAMPEN.COM OR SPEAK WITH YOUR FINANCIAL ADVISOR. INVESTMENT RETURNS, NET
ASSET VALUE (NAV) AND COMMON SHARE MARKET PRICE WILL FLUCTUATE AND TRUST SHARES,
WHEN SOLD, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.

NAV per share is determined by dividing the value of the trust's portfolio
securities, cash and other assets, less all liabilities, by the total number of
common shares outstanding. The common share market price is the price the market
is willing to pay for shares of the trust at a given time. Common share market
price is influenced by a range of factors, including supply and demand and
market conditions. Total return assumes an investment at the beginning of the
period, reinvestment of all distributions for the period in accordance with the
trust's dividend reinvestment plan, and sale of all shares at the end of the
period.

The Lehman Brothers Municipal Bond Index is a broad-based statistical composite
of municipal bonds. The index does not include any expenses, fees or sales
charges, which would lower performance. The index is unmanaged and should not be
considered an investment. It is not possible to invest directly in an index.



                                      C-3
<PAGE>



Trust Report

FOR THE 12-MONTH PERIOD ENDED OCTOBER 31, 2004

Van Kampen Municipal Trust is managed by the Adviser's Municipal Fixed Income
team.(1) Current members include Thomas Byron, Vice President; Robert Wimmel,
Vice President; and John Reynoldson, Executive Director.

MARKET CONDITIONS

The interest-rate environment of the 12 months ended October 31, 2004 was marked
by two periods of steadily declining yields, with a significant sell-off in the
middle. Yields fell steadily through the first half of the period, approaching
the historical lows of 2003. This trend persisted until March, at which point
yields reversed direction and began an upward march as prices fell. These losses
were steepest in April, as a surprisingly strong employment report and signals
from members of the Federal Open Market Committee (the Fed) caused investors to
expect a near-term rate increase. Rates went on to decline from May through the
end of the period as the market digested the Fed's newly hawkish rate stance.
Investors were further comforted when, after the Fed raised rates at its June
30, 2004 meeting, its members indicated that the path of future rate increases
would be measured.

Unusually, longer-maturity securities largely outperformed in this period of Fed
tightening. Historically, the typical pattern in periods of tightening policy
has seen yields rise across all maturities. During the review period, however,
yields of shorter maturity bonds rose while those of bonds with longer
maturities declined slightly.

Lower-quality municipal bonds also performed strongly in this environment, as
the difference in yields (known as the "yield spread") between AAA and BBB rated
bonds decreased by roughly 20 basis points for 20-year bonds. As a result,
sectors with heavy exposure to lower-rated debt, such as hospitals and
industrial-revenue bonds, posted higher total returns than sectors dominated by
higher-rated debt.

Issuance for the first 10 months of 2004 (the final 10 months of the review
period) was roughly six percent lower than in the same period in 2003. That
said, 2003 was a record year, and at the current pace of issuance, 2004 could
well be one of the largest years in recent memory. The strong supply met with
faltering demand from mutual funds, as fund investors withdrew over $15 billion
in net cash during the period. The faltering demand was largely offset by
increased participation in the market by insurance companies and individual
investors.

(1)Team members may change without notice at any time.




                                      C-4
<PAGE>



PERFORMANCE ANALYSIS

The trust's return can be calculated based upon either the market price or the
net asset value (NAV) of its shares. NAV per share is determined by dividing the
value of the trust's portfolio securities, cash and other assets, less all
liabilities, by the total number of common shares outstanding, while market
price reflects the supply and demand for the shares. As a result, the two
returns can differ significantly. On both an NAV basis and a market price basis,
the trust outperformed its benchmark index, the Lehman Brothers Municipal Bond
Index. (See table below.)

The trust uses leverage to enhance its dividend to common shareholders. The
trust borrows money at short-term rates through the issuance of preferred
shares. The proceeds are reinvested in longer-term securities, taking advantage
of the difference between short- and longer-term rates. The Fed's policy of
raising interest rates in the final months of the period made the trust's
borrowing activity more expensive. These expenses, however, were more than
offset by the strong performance of the bonds the trust invested in, leading to
the portfolio's outperformance versus its benchmark, which is unleveraged.

The historically low level of interest rates led us to maintain the trust's
overall interest-rate sensitivity at a level below that of its benchmark. This
strategy helped shield the trust from negative returns during those times when
yields rose. That said, yields overall declined over the period, and the
strategy exerted a drag on performance.

The fund experienced significant call activity during the period, as issuers
sought to lower their interest costs by refinancing their bonds at lower market
rates. This activity involved 23 percent of the total sales activity in the
trust. We reinvested the proceeds into bonds that we believed had more favorable
prospects for total return. Many of these securities were in the 15- to 20-year
segment of the market, which our analysis indicated offered the most appealing
combination of value and total-return potential.

In keeping with our long-term approach, we bought and sold bonds at the long end
of the market as they came into and out of fair value. This strategy entails

TOTAL RETURN FOR THE 12-MONTH PERIOD ENDED OCTOBER 31, 2004

<Table>
<Caption>
- --------------------------------------------------------------
        BASED ON       BASED ON       LEHMAN BROTHERS
          NAV        MARKET PRICE   MUNICIPAL BOND INDEX
<S>   <C>            <C>            <C>                  <C>

         9.03%          9.15%              6.03%
- --------------------------------------------------------------
</Table>

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES
SHOWN. INVESTMENT RETURN, NET ASSET VALUE AND COMMON SHARE MARKET PRICE WILL
FLUCTUATE AND TRUST SHARES, WHEN SOLD, MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST. SEE PERFORMANCE SUMMARY FOR ADDITIONAL PERFORMANCE INFORMATION
AND INDEX DEFINITION.



                                      C-5
<PAGE>



purchasing bonds with attractive total-return prospects and selling them once
they have reached our performance targets. Many of our purchases in this
strategy involved health-care bonds, which offered attractive valuations for
much of the period.

We remained focused on controlling the trust's risk profile through attention to
credit quality and diversification. By the end of the 12-month period, 83
percent of the trust's total investments were invested in bonds rated AAA and
AA; these represent the two highest tiers of credit ratings. The portfolio was
also well diversified across the major sectors of the municipal bond market. Its
three largest sector exposures were general purpose, public education, and
transportation.

While it is impossible to predict the exact turning point when interest rates
will move decisively higher, we believe the trust remains well positioned for
the near future. We will continue to search the municipal bond markets for
interesting opportunities.

There is no guarantee that any securities mentioned will continue to perform
well or be held by the trust in the future.




                                      C-6
<PAGE>



<Table>
<Caption>
RATINGS ALLOCATION AS OF 10/31/04
<S>                                                                 <C>
AAA/Aaa                                                              72.2%
AA/Aa                                                                10.8
A/A                                                                   4.5
BBB/Baa                                                               3.4
BB/Ba                                                                 1.7
B/B                                                                   0.2
Non-Rated                                                             7.2

<Caption>
TOP 5 SECTORS AS OF 10/31/04
<S>                                                                 <C>
General Purpose                                                      20.5%
Public Education                                                     10.4
Transportation                                                        9.9
Public Building                                                       9.0
Health Care                                                           8.6

<Caption>
SUMMARY OF INVESTMENTS BY STATE CLASSIFICATION AS OF 10/31/04
<S>                                                                 <C>
Illinois                                                             10.1%
California                                                            9.6
New York                                                              8.6
New Jersey                                                            7.0
Texas                                                                 6.7
Florida                                                               6.7
Ohio                                                                  4.2
Pennsylvania                                                          4.0
Washington                                                            3.7
Connecticut                                                           3.7
North Carolina                                                        3.1
Louisiana                                                             2.7
Massachusetts                                                         2.7
Georgia                                                               2.5
Michigan                                                              2.4
Alabama                                                               2.2
Missouri                                                              1.8
Kentucky                                                              1.5
Virginia                                                              1.5
Oregon                                                                1.4
Colorado                                                              1.3
Nevada                                                                1.1
Tennessee                                                             1.1
Indiana                                                               1.0
Maryland                                                              0.9
New Hampshire                                                         0.9
West Virginia                                                         0.7
Kansas                                                                0.7
District of Columbia                                                  0.7
Puerto Rico                                                           0.7
Oklahoma                                                              0.6
Wisconsin                                                             0.6
Guam                                                                  0.6
Arizona                                                               0.5
South Carolina                                                        0.5
                                                 (continued on next page)
</Table>



                                      C-7
<PAGE>



<Table>
<Caption>
SUMMARY OF INVESTMENTS BY STATE CLASSIFICATION AS OF 10/31/04
                                           (continued from previous page)
<S>                                                                 <C>
Arkansas                                                              0.5%
Mississippi                                                           0.3
Rhode Island                                                          0.3
South Dakota                                                          0.2
Hawaii                                                                0.2
New Mexico                                                            0.2
Alaska                                                                0.1
Maine                                                                 0.1
Nebraska                                                              0.1
                                                                    -----
Total Investments                                                   100.0%
</Table>

Subject to change daily. Provided for informational purposes only and should not
be deemed as a recommendation to buy or sell the securities mentioned or
securities in the sectors shown above. Ratings and summary of investments by
state classification are as a percentage of total investments. Sectors are as a
percentage of long-term investments. Securities are classified by sectors that
represent broad groupings of related industries. Van Kampen is a wholly owned
subsidiary of a global securities firm which is engaged in a wide range of
financial services including, for example, securities trading and brokerage
activities, investment banking, research and analysis, financing and financial
advisory services. Rating allocations based upon ratings as issued by Standard
and Poor's and Moody's, respectively.





                                      C-8
<PAGE>



FOR MORE INFORMATION ABOUT PORTFOLIO HOLDINGS

       Each Van Kampen trust provides a complete schedule of portfolio holdings
       in its semiannual and annual reports within 60 days of the end of the
       trust's second and fourth fiscal quarters by filing the schedule
       electronically with the Securities and Exchange Commission (SEC). The
       semiannual reports are filed on Form N-CSRS and the annual reports are
       filed on Form N-CSR. Van Kampen also delivers the semiannual and annual
       reports to trust shareholders, and makes these reports available on its
       public web site, www.vankampen.com. In addition to the semiannual and
       annual reports that Van Kampen delivers to shareholders and makes
       available through the Van Kampen public web site, each trust files a
       complete schedule of portfolio holdings with the SEC for the trust's
       first and third fiscal quarters on Form N-Q. Van Kampen does not deliver
       the reports for the first and third fiscal quarters to shareholders, nor
       are the reports posted to the Van Kampen public web site. You may,
       however, obtain the Form N-Q filings (as well as the Form N-CSR and
       N-CSRS filings) by accessing the SEC's web site, http://www.sec.gov. You
       may also review and copy them at the SEC's Public Reference Room in
       Washington, DC. Information on the operation of the SEC's Public
       Reference Room may be obtained by calling the SEC at 1-202-942-8090. You
       can also request copies of these materials, upon payment of a duplicating
       fee, by electronic request at the SEC's e-mail address
       (publicinfo@sec.gov) or by writing the Public Reference section of the
       SEC, Washington, DC 20549-0102.

       In addition to filing a complete schedule of portfolio holdings with the
       SEC each fiscal quarter, each Van Kampen trust makes portfolio holdings
       information available by periodically providing the information on its
       public web site, www.vankampen.com. Each Van Kampen trust provides a
       complete schedule of portfolio holdings on the public web site on a
       calendar-quarter basis approximately 30 days after the close of the
       calendar quarter. Van Kampen closed-end funds do not presently provide
       partial lists of their portfolio holdings on a monthly basis, but may do
       so in the future.

       You may obtain copies of a trust's fiscal quarter filings, or its monthly
       or calendar-quarter web site postings, by contacting Van Kampen Client
       Relations at 1-800-847-2424.

PROXY VOTING POLICIES AND PROCEDURES AND PROXY VOTING RECORD

       The trust's policies and procedures with respect to the voting of proxies
       relating to the trust's portfolio securities and information on how the
       trust voted proxies relating to portfolio securities during the most
       recent twelve-month period ended June 30 is available without charge,
       upon request, by calling 1-800-847-2424 or by visiting our web site at
       www.vankampen.com. This information is also available on the Securities
       and Exchange Commission's web site at http://www.sec.gov.



                                      C-9
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          MUNICIPAL BONDS  148.1%
          ALABAMA  3.3%
$1,000    Birmingham Baptist Med Ctr AL Baptist Hlth Sys
          Ser A..........................................  5.875%   11/15/24   $   1,042,280
 2,695    Gadsden, AL Wts Ser B (AMBAC Insd).............  5.250    08/01/21       2,955,418
 4,000    Jefferson Cnty, AL Swr Rev Cap Impt Wts
          (Prerefunded @ 08/01/12) (FGIC Insd)...........  5.125    02/01/42       4,506,800
 6,215    Jefferson Cnty, AL Swr Rev Cap Impt Wts Ser A
          (Prerefunded @ 02/01/11) (FGIC Insd)...........  5.000    02/01/41       6,932,025
 1,735    Jefferson Cnty, AL Swr Rev Cap Impt Wts Ser A
          (Prerefunded @ 02/01/11) (FGIC Insd)...........  5.000    02/01/41       1,943,582
 2,405    Marshall Cnty, AL Hlthcare Ser C...............  6.000    01/01/32       2,543,865
                                                                               -------------
                                                                                  19,923,970
                                                                               -------------
          ALASKA  0.2%
 1,000    Alaska St Intl Arpt Rev Ser B (AMBAC Insd).....  5.750    10/01/17       1,152,230
                                                                               -------------

          ARIZONA  0.7%
 1,425    Arizona Cap Fac Fin Corp Student Hsg Rev AZ St
          Univ Proj......................................  6.250    09/01/32       1,516,912
 1,000    Arizona Hlth Fac Auth Hosp John C Lincoln Hlth
          Network........................................  6.375    12/01/37       1,061,500
 1,750    Arizona Sch Fac Brd Ctf Part Ser A (MBIA
          Insd)..........................................  5.250    09/01/17       1,933,102
                                                                               -------------
                                                                                   4,511,514
                                                                               -------------
          ARKANSAS  0.7%
 2,310    Arkansas St Dev Fin Auth Rev St Agy Fac
          Donaghey Plaza Proj (FSA Insd).................  5.000    06/01/34       2,376,389
 1,565    Fort Smith, AR Wtr & Swr Rev Ser C (FSA Insd)
          (f)............................................  5.000    10/01/21       1,676,459
                                                                               -------------
                                                                                   4,052,848
                                                                               -------------
          CALIFORNIA  14.3%
 4,000    Anaheim, CA Pub Fin Auth Lease Rev Cap Apprec
          Sub Pub Impts Proj C (FSA Insd)................    *      09/01/20       1,897,280
   350    California Hlth Fac Fin Auth Rev Casa De Las
          Ser A (MBIA Insd)..............................  5.250    08/01/17         379,634
 2,500    California St (AMBAC Insd).....................  5.000    04/01/21       2,645,100
 5,500    California St (AMBAC Insd).....................  5.125    10/01/27       5,734,135
 1,250    California St Dept Wtr Res Pwr Ser A...........  6.000    05/01/15       1,463,350
 4,000    California St Dept Wtr Res Pwr Ser A (AMBAC
          Insd) (a)......................................  5.375    05/01/18       4,436,800
 3,705    California St Dept Wtr Res Pwr Ser A (MBIA
          Insd)..........................................  5.375    05/01/21       4,061,273
 2,000    California St Dept Wtr Res Pwr Ser A (MBIA
          Insd)..........................................  5.375    05/01/22       2,185,520
 5,295    California St Econ Rec Ser A...................  5.000    07/01/17       5,680,635
 2,500    California St Pub Wks Brd Lease Rev Dept
          Corrections Ser E Rfdg (XLCA Insd).............  5.000    06/01/18       2,723,375
</Table>

                                             See Notes to Financial Statements



                                      C-10
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          CALIFORNIA (CONTINUED)
$1,000    California St Pub Wks Brd UCLA Replacement Hosp
          Ser A (FSA Insd)...............................  5.375%   10/01/20   $   1,097,880
 5,000    California St Univ Rev Systemwide Ser A (AMBAC
          Insd)..........................................  5.000    11/01/23       5,263,650
 2,650    California Statewide Cmnty Dev Auth Ctf Part
          (Acquired 04/12/02, Cost $2,650,000) (b).......  7.250    11/01/29       2,772,536
 5,000    Contra Costa, CA Home Mtg Fin Auth Home Mtg Rev
          (Escrowed to Maturity) (MBIA Insd).............    *      09/01/17       2,735,750
 1,000    Davis, CA Pub Fac Fin Auth Mace Ranch Area Ser
          A..............................................  6.600    09/01/25       1,052,920
   850    Del Mar, CA Race Track Auth Rev Rfdg...........  6.000    08/15/06         875,134
18,000    Foothill/Eastern Corridor Agy CA Toll Rd Rev
          Cap Apprec Rfdg (MBIA Insd)....................    *      01/15/25       5,675,220
27,810    Foothill/Eastern Corridor Agy CA Toll Rd Rev
          Cap Apprec Rfdg................................    *      01/15/33       5,185,174
 6,000    Foothill/Eastern Corridor Agy CA Toll Rd Rev
          Cap Apprec Sr Lien Ser A (Escrowed to
          Maturity)......................................    *      01/01/18       3,428,100
 2,240    Huntington Park, CA Redev Agy Rev Tax Alloc
          Santa Fe Redev Rfdg............................  6.200    10/01/27       2,336,947
 2,635    Imperial Irr Dist CA Ctf Part Elec Sys Proj
          (FSA Insd).....................................  5.250    11/01/23       2,847,855
 2,000    Los Angeles, CA Uni Sch Dist Ser A (MBIA
          Insd)..........................................  5.375    07/01/18       2,237,820
 4,400    Los Angeles, CA Uni Sch Dist Ser A (MBIA
          Insd)..........................................  5.250    07/01/19       4,855,400
 5,585    Sacramento, CA City Fin Auth Rev Comb Proj B
          (MBIA Insd)....................................    *      11/01/14       3,712,685
 1,375    San Bernadino, CA Jt Pwrs Fin Auth Alloc Rev
          Cent City Merged Proj A Rfdg (AMBAC Insd)
          (f)............................................  5.750    07/01/20       1,650,412
 3,545    San Diego, CA Uni Sch Dist Election 1998 Ser
          E-1 Rfdg (MBIA Insd)...........................  5.000    07/01/23       3,804,352
 5,000    University CA Rev Gen Ser B (AMBAC Insd).......  5.000    05/15/20       5,364,400
                                                                               -------------
                                                                                  86,103,337
                                                                               -------------
          COLORADO  2.0%
 1,000    Colorado Hlth Fac Auth Rev Catholic Hlth
          Initiatives Ser A (Escrowed to Maturity).......  5.500    03/01/32       1,050,690
 1,125    Colorado Hlth Fac Auth Rev Hosp Portercare
          Adventist Hlth.................................  6.500    11/15/31       1,236,645
 2,200    La Plata Cnty, CO Sch Dist 9-R Durango (MBIA
          Insd) (f)......................................  5.250    11/01/21       2,382,886
 6,365    Platte Riv Pwr Auth CO Pwr Rev Ser EE..........  5.375    06/01/16       7,167,690
                                                                               -------------
                                                                                  11,837,911
                                                                               -------------
          CONNECTICUT  5.5%
 1,935    Bridgeport, CT Ser A (MBIA Insd) (f)...........  5.250    08/15/20       2,130,125
 2,265    Bridgeport, CT Ser A (MBIA Insd) (f)...........  5.250    08/15/23       2,455,169
 7,140    Connecticut St Hlth & Ed Fac Auth Rev Nursing
          Home Proj AHF/Hartford (Prerefunded @
          11/01/04)......................................  7.125    11/01/24       7,284,871
</Table>

See Notes to Financial Statements


                                      C-11
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          CONNECTICUT (CONTINUED)
$2,840    Connecticut St Spl Oblig Pkg Rev Bradley Intl
          Arpt Ser A (AMT) (ACA Insd)....................  6.600%   07/01/24   $   3,077,964
 3,540    Mashantucket Western Pequot Tribe CT Spl Rev
          Ser A, 144-A Private Placement (c).............  6.400    09/01/11       3,786,526
 3,460    Mashantucket Western Pequot Tribe CT Spl Rev
          Ser A, 144-A Private Placement (Prerefunded @
          09/01/07) (c)..................................  6.400    09/01/11       3,851,568
 6,500    Mashantucket Western Pequot Tribe CT Spl Rev
          Ser B, 144-A Private Placement (c).............  5.750    09/01/18       6,845,345
 3,500    Mashantucket Western Pequot Tribe CT Spl Rev
          Ser B, 144-A Private Placement (c).............  5.750    09/01/27       3,609,060
                                                                               -------------
                                                                                  33,040,628
                                                                               -------------
          DISTRICT OF COLUMBIA  1.0%
 1,000    District of Columbia Hosp Rev Medlantic
          Hlthcare Group A Rfdg (Escrowed to Maturity)
          (MBIA Insd)....................................  5.875    08/15/19       1,080,250
 5,000    Metropolitan Washington DC Arpt Auth Sys Ser A
          (AMT) (FGIC Insd)..............................  5.125    10/01/26       5,143,350
                                                                               -------------
                                                                                   6,223,600
                                                                               -------------
          FLORIDA  10.0%
 3,380    Brevard Cnty, FL Hlth Fac Hlth First Inc Proj
          (MBIA Insd)....................................  5.125    04/01/31       3,480,758
 2,550    Broward Cnty, FL Wtr & Swr Util Rfdg (MBIA
          Insd)..........................................  5.000    10/01/20       2,746,630
 3,040    Escambia Cnty, FL Hlth Fac Auth Rev (AMBAC
          Insd)..........................................  5.950    07/01/20       3,122,870
 1,000    Florida St Brd Ed Lottery Rev Ser A (FGIC
          Insd)..........................................  5.750    07/01/11       1,151,140
 3,000    Florida St Dept Environmental Protection
          Preservation Rev Ser A (FGIC Insd).............  5.750    07/01/10       3,444,930
 3,880    Florida St Dept Trans Right of Way Ser A.......  5.250    07/01/21       4,306,916
 1,895    Gulf Breeze, FL Rev Loc Govt (Variable Rate
          Coupon) (FGIC Insd) (f)........................  5.625    12/01/20       2,078,550
 2,310    Hillsborough Cnty, FL Indl Dev Auth Andl Dev
          Rev Hlth Fac Proj Univ Cmnty Hosp Ser A........  5.500    08/15/14       2,412,148
 1,000    Hillsborough Cnty, FL Util Jr Lien Rfdg (AMBAC
          Insd)..........................................  5.000    08/01/06       1,052,750
 1,000    Jea, FL Elec Sys Rev Ser 3 Ser A...............  5.500    10/01/41       1,067,250
   265    Lakeland, FL Hosp Sys Rev Lakeland Regl Hlth
          Sys............................................  5.500    11/15/32         276,419
 1,515    Miami Beach, FL Stormwtr Rev (FGIC Insd).......  5.250    09/01/25       1,622,307
 2,000    Miami-Dade Cnty, FL Aviation Rev Miami Intl
          Arpt (AMT) (FGIC Insd).........................  5.375    10/01/25       2,107,840
 2,700    Miami-Dade Cnty, FL Aviation Rev Miami Intl
          Arpt (AMT) (FGIC Insd).........................  5.375    10/01/32       2,808,054
 5,000    Miami-Dade Cnty, FL Aviation Ser A (AMT) (FSA
          Insd)..........................................  5.125    10/01/35       5,093,300
</Table>

                                             See Notes to Financial Statements



                                      C-12
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          FLORIDA (CONTINUED)
$1,855    Miami-Dade Cnty, FL Hlth Fac Miami Childrens
          Hosp Ser A Rfdg (AMBAC Insd)...................  5.000%   08/15/20   $   1,958,342
 3,750    Orange Cnty, FL Sch Brd Ctf Part Ser A (AMBAC
          Insd)..........................................  5.250    08/01/14       4,220,550
 4,320    Orange Cnty, FL Tourist Dev Tax Rev (AMBAC
          Insd)..........................................  5.625    10/01/14       4,857,322
 4,300    Orange Cnty, FL Tourist Dev Tax Rev (AMBAC
          Insd)..........................................  5.500    10/01/31       4,674,100
 1,000    Osceola Cnty, FL Trans Rev Osceola Pkwy Proj
          Impt & Rfdg (MBIA Insd)........................  5.000    04/01/21       1,075,800
 2,140    Reedy Creek, FL Impt Dist FL Ser A Rfdg (AMBAC
          Insd)..........................................  5.500    06/01/12       2,434,057
 1,060    Tallahassee, FL Lease Rev FL St Univ Proj Ser A
          (MBIA Insd) (f)................................  5.500    08/01/18       1,188,631
 2,780    Volusia Cnty, FL Gas Tax Rev (FSA Insd) (d)....  5.000    10/01/22       2,978,687
                                                                               -------------
                                                                                  60,159,351
                                                                               -------------
          GEORGIA  3.7%
 2,000    Atlanta, GA Arpt Passenger Fac Gen Sub Lien Ser
          C (FSA Insd)...................................  5.000    01/01/33       2,064,140
 2,645    Georgia St Ser D...............................  6.000    10/01/05       2,745,986
 3,500    Georgia St Ser D...............................  6.000    10/01/06       3,765,755
 1,400    Municipal Elec Auth GA Combustion Turbine Proj
          Ser A (MBIA Insd)..............................  5.250    11/01/14       1,578,934
 8,030    Municipal Elec Auth GA Combustion Turbine Proj
          Ser A (MBIA Insd)..............................  5.250    11/01/18       8,945,581
 1,000    Oconee Cnty, GA Indl Dev Auth Oiit Proj (XLCA
          Insd)..........................................  5.250    07/01/23       1,067,730
 2,000    Royston, GA Hosp Auth Hosp Ctf Rev Ty Cobb
          Hlthcare Sys Inc Rfdg..........................  6.500    07/01/27       1,994,600
                                                                               -------------
                                                                                  22,162,726
                                                                               -------------
          HAWAII  0.3%
 1,465    Honolulu, HI City & Cnty Ser D (AMT) (FGIC
          Insd)..........................................  4.700    02/01/08       1,562,657
   645    Honolulu, HI City & Cnty Wastewtr Sys Rev Cap
          Apprec (FGIC Insd).............................    *      07/01/12         482,112
                                                                               -------------
                                                                                   2,044,769
                                                                               -------------
          ILLINOIS  15.1%
 3,400    Carol Stream, IL First Mtg Rev Windsor Pk Mnr
          Proj (Prerefunded @ 12/01/07)..................  7.000    12/01/13       3,910,680
 1,500    Champaign Cnty, IL Cmnty Unit Sch Dist No 116
          Urbana Ser C (Prerefunded @ 01/01/10) (FGIC
          Insd)..........................................    *      01/01/16         897,720
 1,300    Champaign Cnty, IL Cmnty Unit Sch Dist No 116
          Urbana Ser C (Prerefunded @ 01/01/10) (FGIC
          Insd)..........................................    *      01/01/18         688,584
</Table>

See Notes to Financial Statements



                                      C-13
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          ILLINOIS (CONTINUED)
$1,285    Chicago, IL Brd Ed (Prerefunded @ 12/01/10)
          (FGIC Insd)....................................  6.000%   12/01/12   $   1,503,578
 1,400    Chicago, IL Brd Ed Ser A (MBIA Insd)...........  5.500    12/01/28       1,521,800
 4,000    Chicago, IL Neighborhoods Alive 21 Pgm Ser A
          (FGIC Insd)....................................  5.750    01/01/40       4,420,040
 5,000    Chicago, IL O'Hare Intl Arpt Rev Gen Arpt Third
          Lien Ser A Rfdg (AMT) (MBIA Insd)..............  5.375    01/01/32       5,173,900
 2,500    Chicago, IL O'Hare Intl Arpt Rev Gen Arpt Third
          Lien Ser C 2 Rfdg (AMT) (FSA Insd).............  5.250    01/01/30       2,585,325
 1,015    Chicago, IL O'Hare Intl Arpt Rev Second Lien
          Passenger Fac Ser B (AMBAC Insd)...............  5.500    01/01/16       1,133,156
 1,980    Chicago, IL Pk Dist Ser C (FGIC Insd)..........  5.500    01/01/19       2,219,976
 2,565    Chicago, IL Proj Ser C Rfdg (FGIC Insd) (f)....  5.750    01/01/12       2,936,771
 1,000    Cook Cnty, IL Cmnty Cons Sch Dist No 64 Park
          Ridge (FSA Insd)...............................  5.500    12/01/14       1,162,820
 1,000    Cook Cnty, IL Ser A (FGIC Insd)................  5.500    11/15/31       1,082,670
 7,765    Du Page Cnty, IL Forest Preserve Dist..........    *      11/01/17       4,403,143
 5,000    Du Page Cnty, IL Trans Rev (FSA Insd)..........  5.750    01/01/15       5,708,700
 4,000    Hodgkins, IL Tax Increment Ser A Rfdg..........  7.625    12/01/13       4,288,080
 2,860    Illinois Dev Fin Auth Rev Adventist Hlth Ser A
          (MBIA Insd) (e) (f)............................  5.500    11/15/05       2,960,043
 2,725    Illinois Dev Fin Auth Rev Cmnty Rehab Providers
          Fac Ser A......................................  7.375    07/01/25       2,946,597
 2,705    Illinois Dev Fin Auth Rev Loc Govt Pgm Aurora
          East Sch (MBIA Insd)...........................    *      12/01/15       1,694,980
 1,565    Illinois Ed Fac Auth Rev DePaul Univ
          (Prerefunded @ 10/01/10) (AMBAC Insd)..........  5.625    10/01/15       1,809,156
 1,740    Illinois Ed Fac Auth Rev Lewis Univ............  5.900    10/01/14       1,744,437
 2,500    Illinois Fin Auth Rev Northwestern Mem Hosp Ser
          A..............................................  5.500    08/15/43       2,600,200
 1,645    Illinois Hlth Fac Auth Rev Evangelical Hosp Ser
          C Rfdg (FSA Insd)..............................  6.750    04/15/12       1,956,958
 2,500    Illinois St First Ser (MBIA Insd)..............  5.500    12/01/09       2,827,000
 1,500    Illinois St First Ser (FGIC Insd)..............  5.375    11/01/14       1,696,260
 3,000    Illinois St First Ser (FSA Insd)...............  5.250    12/01/21       3,249,330
 3,440    Kendall Kane & Will Cntys, IL Cmnty Sch Dist No
          308 Ser B (FGIC Insd) (f)......................  5.250    10/01/19       3,802,163
   870    Metropolitan Pier & Expo Auth IL Dedicated St
          Tax Rev Cap Apprec (Escrowed to Maturity) (FGIC
          Insd)..........................................    *      06/15/14         591,939
 3,460    Metropolitan Pier & Expo Auth IL Dedicated St
          Tax Rev Cap Apprec (Unrefunded Balance) (FGIC
          Insd)..........................................    *      06/15/14       2,338,649
 2,675    Metropolitan Pier & Expo Auth IL Dedicated St
          Tax Rev McCormick Pl Expn Ser A (MBIA Insd)....  5.250    06/15/42       2,794,626
</Table>

                                             See Notes to Financial Statements



                                      C-14
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          ILLINOIS (CONTINUED)
$1,510    Roselle, IL Multi-Family Hsg Rev Waterbury Apts
          Ser A Rfdg (GNMA Collateralized)...............  7.000%   01/01/25   $   1,544,775
 2,500    Schaumburg, IL Ser B (FGIC Insd)...............  5.000    12/01/41       2,534,525
 3,505    Will Cnty, IL Cmnty Sch Dist No 161 Summit Hill
          Cap Apprec (FGIC Insd).........................    *      01/01/14       2,404,745
 2,010    Will Cnty, IL Cmnty Sch Dist No 161 Summit Hill
          Cap Apprec (FGIC Insd).........................    *      01/01/16       1,238,703
 1,415    Will Cnty, IL Cmnty Sch Dist No 161 Summit Hill
          Cap Apprec (FGIC Insd).........................    *      01/01/19         737,611
 9,660    Will Cnty, IL Fst Presv Dist Ser B (FGIC
          Insd)..........................................    *      12/01/16       5,734,949
                                                                               -------------
                                                                                  90,844,589
                                                                               -------------
          INDIANA  1.3%
 1,000    Allen Cnty, IN Juvenile Justice Ctr First Mtg
          (AMBAC Insd)...................................  5.500    01/01/18       1,122,060
 1,000    Clark Pleasant, IN Cmnty Sch First Mtg (AMBAC
          Insd)..........................................  5.500    07/15/13       1,136,810
 1,580    Indiana Trans Fin Auth Toll Rd Lease Rev Rfdg
          (AMBAC Insd)...................................  5.375    07/01/09       1,691,927
 1,500    Petersburg, IN Pollutn Ctl Rev IN Pwr & Lt
          (AMT) (e)......................................  5.950    12/01/29       1,515,630
 2,500    Vigo Cnty, IN Sch Bldg Corp First Mtg Impt &
          Rfdg (FSA Insd)................................  5.250    07/10/24       2,663,350
                                                                               -------------
                                                                                   8,129,777
                                                                               -------------
          KANSAS  1.1%
 3,000    Sedgwick Cnty, KS Uni Sch Dist No 259 Wichita
          (MBIA Insd)....................................  6.000    09/01/09       3,446,280
 1,395    Wichita, KS Pub Bldg Comm Rev Wichita St Univ
          Proj Ser L Rfdg (AMBAC Insd) (f)...............  5.000    02/01/15       1,520,048
 1,465    Wichita, KS Pub Bldg Comm Rev Wichita St Univ
          Proj Ser L Rfdg (AMBAC Insd) (f)...............  5.000    02/01/16       1,587,562
                                                                               -------------
                                                                                   6,553,890
                                                                               -------------
          KENTUCKY  2.2%
 4,000    Elsmere, KY Indl Dev Rev Courtaulds Pkg Inc
          Proj Rfdg (Prerefunded @ 04/01/05).............  6.750    04/01/10       4,159,840
 1,500    Kentucky St Ppty & Bldg Commn Proj No 69 Ser A
          Rfdg (FSA Insd)................................  5.500    08/01/11       1,718,520
 3,500    Kentucky St Tpk Auth Econ Dev Revitalization
          Proj Rfdg (FSA Insd)...........................  5.500    07/01/07       3,808,980
 1,000    Kentucky St Tpk Auth Econ Dev Revitalization
          Proj Rfdg (Prerefunded @ 01/01/11) (FSA
          Insd)..........................................  5.625    07/01/14       1,145,950
 2,350    Louisville & Jefferson, KY Swr Ser A (MBIA
          Insd) (f)......................................  5.500    05/15/15       2,675,334
                                                                               -------------
                                                                                  13,508,624
                                                                               -------------
</Table>

See Notes to Financial Statements


                                      C-15
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          LOUISIANA  3.7%
$5,000    Ernest N Morial New Orleans LA Sr Sub Ser A
          (AMBAC Insd)...................................  5.250%   07/15/21   $   5,442,150
 1,500    Louisiana Hsg Fin Agy Rev Azalea Estates Ser A
          Rfdg (AMT) (GNMA Collateralized)...............  5.375    10/20/39       1,523,820
 1,675    Louisiana Loc Govt Environmental Fac Pkg Fac
          Corp Garage Proj Ser A (AMBAC Insd) (f)........  5.200    10/01/19       1,841,847
 2,580    Louisiana Loc Govt Environmental Rev Southeastn
          LA Student Hsg A (MBIA Insd)...................  5.250    08/01/21       2,824,042
 3,000    Louisiana St Ser A (FGIC Insd).................  5.500    11/15/07       3,291,360
 8,033    Louisiana St Univ & Agric & Mechanical College
          Univ Rev Master Agreement (Acquired 11/30/98,
          Cost $8,032,929) (b)...........................  5.750    10/30/18       7,629,435
                                                                               -------------
                                                                                  22,552,654
                                                                               -------------
          MAINE  0.2%
 1,000    Maine Vets Homes, ME Rev (Prerefunded @
          10/01/05)......................................  7.750    10/01/20       1,070,110
                                                                               -------------

          MARYLAND  1.3%
 2,300    Baltimore, MD Cap Apprec Cons Pub Ser A Impt &
          Rfdg (FGIC Insd)...............................    *      10/15/06       2,129,869
 1,845    Baltimore, MD Cap Apprec Ser A (Unrefunded
          Balance) (FGIC Insd)...........................    *      10/15/07       1,603,342
 1,700    Maryland St Trans Auth Arpt Baltimore/WA Intl
          Arpt B (AMT) (AMBAC Insd)......................  5.125    03/01/24       1,779,577
 2,365    Northeast, MD Waste Disp Auth Rfdg (AMT) (AMBAC
          Insd)..........................................  5.500    04/01/16       2,603,132
                                                                               -------------
                                                                                   8,115,920
                                                                               -------------
          MASSACHUSETTS  4.0%
 1,775    Massachusetts Muni Whsl Elec Co Nuclear Proj 5
          (MBIA Insd)....................................  5.250    07/01/13       1,990,396
 1,745    Massachusetts St Cons Ln Ser B (Prerefunded @
          05/01/09)......................................  5.250    05/01/13       1,946,076
 1,000    Massachusetts St Cons Ln Ser B (Prerefunded @
          08/01/14) (AMBAC Insd).........................  5.000    08/01/22       1,067,970
 5,000    Massachusetts St Cons Ln Ser E (Prerefunded @
          01/01/13) (FSA Insd)...........................  5.250    01/01/20       5,637,800
 2,165    Massachusetts St Dev Fin Agy Proj Ser R-2 (MBIA
          Insd)..........................................  5.125    02/01/34       2,232,548
   785    Massachusetts St Dev Fin Agy Rev Boston
          Architectural Ctr (ACA Insd)...................  6.100    09/01/18         841,481
 1,000    Massachusetts St Dev Fin Agy Rev Boston
          Architectural Ctr (ACA Insd)...................  6.250    09/01/28       1,050,950
 1,500    Massachusetts St Fed Hwy Gnt Antic Nt Ser A....  5.750    06/15/15       1,699,830
 3,700    Massachusetts St Hlth & Ed Fac Auth Rev
          (Variable Rate Coupon) (MBIA Insd).............  5.000    07/01/13       3,782,621
</Table>

                                             See Notes to Financial Statements



                                      C-16
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          MASSACHUSETTS (CONTINUED)
$1,000    Massachusetts St Hlth & Ed Fac Auth Rev Part
          Hlthcare Sys Ser C.............................  5.750%   07/01/32   $   1,093,230
 2,500    Massachusetts St Spl Oblig Dedicated Tax Rev
          (FGIC Insd)....................................  5.000    01/01/34       2,574,925
                                                                               -------------
                                                                                  23,917,827
                                                                               -------------
          MICHIGAN  3.6%
 3,440    Detroit, MI Loc Dev Fin Auth Tax Increment Sr
          Ser B (Acquired 09/08/97, Cost $3,440,000)
          (b)............................................  6.700    05/01/21       3,441,961
   850    Detroit, MI Loc Dev Fin Auth Tax Increment Sub
          Ser C (Acquired 09/08/97, Cost $850,000) (b)...  6.850    05/01/21         834,785
 3,860    Detroit, MI Ser A (XLCA Insd) (f)..............  5.250    04/01/21       4,137,804
 2,930    Detroit, MI Wtr Supply Sys Rev Sr Lien Ser C
          Rfdg (MBIA Insd) (f)...........................  5.250    07/01/18       3,221,916
 1,180    Hillsdale, MI Hosp Fin Auth Hosp Rev Hillsdale
          Cmnty Hlth Ctr.................................  5.750    05/15/18       1,221,005
 2,000    Michigan Muni Bd Auth Rev Clean Wtr Rev Fd.....  5.250    10/01/18       2,231,480
   500    Michigan St Hosp Fin Auth Rev Hosp Genesys Regl
          Med Ser A Rfdg (Escrowed to Maturity)..........  5.375    10/01/13         557,195
 1,550    Michigan St Hsg Dev Rental Hsg Rev Ser A (AMT)
          (MBIA Insd)....................................  5.300    10/01/37       1,582,798
 1,500    Michigan St Strategic Fd Detroit Edison Co Proj
          C Rfdg (AMT) (XLCA Insd).......................  5.450    12/15/32       1,570,650
 2,500    Michigan St Trunk Line Ser A (Prerefunded @
          11/01/11)......................................  5.500    11/01/15       2,866,925
                                                                               -------------
                                                                                  21,666,519
                                                                               -------------
          MISSISSIPPI  0.5%
 2,500    Mississippi Bus Fin Corp MS Pollutn Ctl Rev Sys
          Energy Res Inc Proj............................  5.875    04/01/22       2,508,750
   480    Mississippi Home Corp Single Family Rev Mtg Ser
          F (AMT) (GNMA Collateralized)..................  7.550    12/01/27         483,893
                                                                               -------------
                                                                                   2,992,643
                                                                               -------------
          MISSOURI  2.7%
 1,400    Ellisville, MO Indl Dev Auth Rev Gambrill
          Gardens Proj Rfdg & Impt.......................  6.100    06/01/20       1,375,626
 1,000    Ellisville, MO Indl Dev Auth Rev Gambrill
          Gardens Proj Rfdg & Impt.......................  6.200    06/01/29         948,690
 1,740    Good Shepherd Nursing Home Dist MO Nursing Home
          Fac Rev (Prerefunded @ 08/15/05)...............  7.625    08/15/15       1,847,897
 1,000    Kearney, MO (AMBAC Insd).......................  5.500    03/01/16       1,116,980
 1,415    Missouri St Hlth & Ed Fac Rev Univ MO Columbia
          Arena Proj.....................................  5.000    11/01/18       1,537,341
 3,085    Missouri St Hwys & Trans Commn Rd Rev Ser A....  5.250    02/01/07       3,305,732
 1,000    Missouri St Hwys & Trans Commn Rd Rev Ser A....  5.125    02/01/17       1,088,300
</Table>

See Notes to Financial Statements


                                      C-17
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          MISSOURI (CONTINUED)
$2,810    Perry Cnty, MO Nursing Home Rev Rfdg...........  5.900%   03/01/28   $   2,509,892
 2,505    Saint Louis, MO Arpt Rev Cap Impt Prog Ser A
          (MBIA Insd) (f)................................  5.375    07/01/20       2,761,788
                                                                               -------------
                                                                                  16,492,246
                                                                               -------------
          NEVADA  1.7%
 3,000    Clark Cnty, NV Arpt Rev Sub Lien Ser A-2 (FGIC
          Insd)..........................................  5.000    07/01/36       3,056,490
 3,000    Clark Cnty, NV Indl Dev Rev Southwest Gas Corp
          Proj Ser A (AMT) (AMBAC Insd)..................  5.250    07/01/34       3,096,000
 2,500    Reno, NV Cap Impt Rev (FGIC Insd)..............  5.125    06/01/26       2,603,975
 1,500    Reno, NV Sr Lien Retrac Reno Trans Proj (AMBAC
          Insd)..........................................  5.125    06/01/37       1,542,930
                                                                               -------------
                                                                                  10,299,395
                                                                               -------------
          NEW HAMPSHIRE  1.3%
 4,800    New Hampshire Higher Ed & Hlth Fac Auth Rev
          Daniel Webster College Issue...................  6.300    07/01/29       4,685,136
 2,000    New Hampshire Higher Ed & Hlth Fac Auth Rev
          Riverwoods at Exeter Ser A.....................  6.500    03/01/23       1,989,180
 1,000    New Hampshire Hlth & Ed Fac Auth Rev Derryfield
          Sch............................................  6.750    07/01/20         987,990
                                                                               -------------
                                                                                   7,662,306
                                                                               -------------
          NEW JERSEY  10.5%
 1,460    Eastern Camden Cnty, NJ Regl Sch Dist Rfdg
          (FGIC Insd) (f)................................    *      03/01/05       1,451,211
 1,465    Eastern Camden Cnty, NJ Regl Sch Dist Rfdg
          (FGIC Insd) (f)................................    *      03/01/06       1,425,518
 1,615    Eastern Camden Cnty, NJ Regl Sch Dist Rfdg
          (FGIC Insd) (f)................................    *      03/01/07       1,526,724
 1,555    Eastern Camden Cnty, NJ Regl Sch Dist Rfdg
          (FGIC Insd) (f)................................    *      03/01/08       1,423,634
 2,895    Essex Cnty, NJ Impt Auth Rev Cnty Gtd Proj
          Consldtn Rfdg (MBIA Insd)......................  5.125    10/01/20       3,160,732
 1,500    New Jersey Econ Dev Auth Cigarette Tax.........  5.750    06/15/29       1,539,930
 3,880    New Jersey Econ Dev Auth Mtr Veh Sur Rev Ser A
          (MBIA Insd)....................................  5.000    07/01/22       4,141,939
25,000    New Jersey Econ Dev Auth St Contract Econ
          Recovery (MBIA Insd) (e).......................  5.900    03/15/21      30,338,250
 2,825    New Jersey St Ed Fac Auth Higher Ed Cap Impt
          Ser A (AMBAC Insd).............................  5.250    09/01/19       3,127,529
 3,500    New Jersey St Tpk Auth Tpk Rev Ser C (FSA
          Insd)..........................................  6.500    01/01/16       4,318,265
 1,000    New Jersey St Trans Corp Capital Grt Antic Nt
          Ser B (AMBAC Insd).............................  5.500    02/01/08       1,099,060
 3,000    New Jersey St Trans Corp Ctf Fed Trans Admin
          Grts Ser A (AMBAC Insd)........................  5.500    09/15/13       3,441,510
</Table>

                                             See Notes to Financial Statements



                                      C-18
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          NEW JERSEY (CONTINUED)
$1,000    New Jersey St Trans Tr Fd Auth Trans Sys Ser
          A..............................................  5.750%   06/15/18   $   1,184,160
 1,840    New Jersey St Trans Tr Fd Auth Trans Sys Ser A
          (FGIC Insd)....................................  5.250    06/15/19       2,040,045
 3,000    Newark, NJ Hsg Auth Port Auth Newark Marine
          Terminal (MBIA Insd)...........................  5.000    01/01/37       3,082,440
                                                                               -------------
                                                                                  63,300,947
                                                                               -------------
          NEW MEXICO  0.3%
 1,500    Jicarilla, NM Apache Nation Adj Ser A (Acquired
          10/23/03, Cost $1,514,910) (b).................  5.000    09/01/18       1,574,220
                                                                               -------------

          NEW YORK  12.8%
 1,670    Long Island Pwr Auth, NY Elec Cap Apprec (FSA
          Insd)..........................................    *      06/01/18         951,232
 3,000    Metropolitan Trans Auth NY Ser A Rfdg (FGIC
          Insd)..........................................  5.250    11/15/31       3,188,460
 2,500    Nassau Cnty, NY Interim Fin Auth Sales Tax
          Secured Ser A (Prerefunded @ 11/15/10).........  5.750    11/15/13       2,899,900
 1,000    Nassau Cnty, NY Ser A Rfdg (FGIC Insd).........  6.000    07/01/10       1,156,770
    85    New York City Adj Sub Ser A-1 (e)..............  6.545    08/01/12          85,884
 2,625    New York City Hlth & Hosp Corp Rev Hlth Sys Ser
          A (AMBAC Insd).................................  5.000    02/15/11       2,904,142
 7,000    New York City Ser A............................  6.250    08/01/08       7,557,410
 2,000    New York City Ser H (FGIC Insd)................  6.000    08/01/12       2,360,280
 1,000    New York City Ser H............................  5.750    03/15/13       1,132,340
 2,500    New York City Ser I (MBIA Insd)................  5.000    08/01/17       2,752,150
 1,000    New York City Transitional Future Tax Secd Ser
          C (AMBAC Insd).................................  5.250    08/01/22       1,080,160
 1,545    New York St Dorm Auth Lease Teachers College
          (FSA Insd).....................................  5.250    08/15/15       1,713,065
 6,800    New York St Dorm Auth Rev City Univ Sys Cons
          Ser A..........................................  5.625    07/01/16       7,936,280
 1,250    New York St Dorm Auth Rev Cons City Univ Sys A
          (FSA Insd).....................................  5.750    07/01/13       1,468,450
 3,000    New York St Dorm Auth Rev Sch Dist Fin Pgm Ser
          D (MBIA Insd)..................................  5.500    10/01/17       3,423,060
 4,200    New York St Dorm Auth Rev Secd Hosp N General
          Hosp Rfdg......................................  5.750    02/15/19       4,709,502
 2,190    New York St Hsg Fin Agy Econ Dev & Hsg Ser A
          (f)............................................  5.250    09/15/20       2,365,747
 1,330    New York St Hsg Fin Agy Econ Dev & Hsg Ser A...  5.000    09/15/22       1,391,233
 4,000    New York St Twy Auth Svc Cntrct Loc Hwy Brdg
          (Prerefunded @ 04/01/11).......................  5.250    04/01/16       4,525,840
 3,000    New York, NY City Mun Wtr Fin Ser B............  5.000    06/15/19       3,258,870
 4,630    Plainedge, NY Un Free Sch Dist No. 2063
          (Acquired 12/01/00, Cost $4,630,041) (b).......  6.000    06/01/12       4,906,037
</Table>

See Notes to Financial Statements


                                      C-19
<PAGE>

VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          NEW YORK (CONTINUED)
$5,000    Sales Tax Asset Receivable Corp Ser A (MBIA
          Insd) (d)......................................  5.000%   10/15/23   $   5,333,250
 3,000    Triborough Brdg & Tunl Auth Gen Purp Ser A.....  5.000    01/01/27       3,078,870
 5,000    Triborough Brdg & Tunl Auth NY Gen Ser B
          Rfdg...........................................  5.000    11/15/21       5,314,400
 2,000    Triborough Brdg & Tunl Auth NY Ser E Rfdg (MBIA
          Insd)..........................................  5.000    11/15/32       2,056,620
                                                                               -------------
                                                                                  77,549,952
                                                                               -------------
          NORTH CAROLINA  4.6%
 2,000    Johnston Cnty, NC (FGIC Insd)..................  5.900    03/01/19       2,310,120
 7,015    North Carolina Eastern Muni Pwr Agy Pwr Sys Rev
          Ser A Rfdg (MBIA Insd).........................  5.500    01/01/05       7,059,475
 8,300    North Carolina Muni Pwr Agy No 1 Catawba Elec
          Rev Rfdg (MBIA Insd) (e).......................  6.000    01/01/12       9,746,441
 6,605    North Carolina Muni Pwr Agy Ser A (MBIA
          Insd)..........................................  5.250    01/01/20       7,177,720
 1,315    University NC Wilmington Rev (AMBAC Insd)
          (f)............................................  5.250    01/01/19       1,443,449
                                                                               -------------
                                                                                  27,737,205
                                                                               -------------
          OHIO  5.9%
 3,950    Cincinnati, OH City Sch Dist Sch Impt (FSA
          Insd)..........................................  5.250    06/01/18       4,390,544
 2,700    Cleveland-Cuyahoga Cnty, OH Dev Port Auth Rev
          Cleveland Bond Fd Ser B (f)....................  5.375    05/15/18       2,738,394
 1,000    Columbus, OH City Sch Dist Sch Fac Constr &
          Impt (FSA Insd)................................  5.250    12/01/21       1,105,080
 1,000    Cuyahoga Cnty, OH Hosp Fac Rev Canton Inc
          Proj...........................................  7.500    01/01/30       1,108,460
 2,350    Franklin Cnty, OH Convention Fac Auth Tax &
          Lease Rev Antic Bds Rfdg (AMBAC Insd)..........  5.250    12/01/17       2,622,553
 1,200    Franklin Cnty, OH Convention Fac Auth Tax &
          Lease Rev Antic Bds Rfdg (AMBAC Insd)..........  5.250    12/01/18       1,334,724
 4,800    Franklin Cnty, OH Hosp Rev Holy Cross Hlth Sys
          Ser B Rfdg (MBIA Insd).........................  5.250    06/01/10       4,908,336
 2,000    Lebanon, OH City Sch Dist (FSA Insd)...........  5.500    12/01/16       2,258,500
 1,000    Lorain Cnty, OH Hosp Rev Catholic Hlthcare.....  5.375    10/01/30       1,032,490
 2,000    Lorain, OH City Sch Dist Classroom Fac Impt
          (MBIA Insd)....................................  5.250    12/01/20       2,198,140
 1,000    Mahoning Cnty, OH Hosp Fac Forum Hlth Oblig
          Group Ser A....................................  6.000    11/15/32       1,059,030
 1,520    Miami Univ OH Gen Rcpts Rfdg (AMBAC Insd)......  5.000    12/01/21       1,630,626
 1,580    Montgomery Cnty, OH Hosp Rev Grandview Hosp &
          Med Ctr Rfdg (Escrowed to Maturity)............  5.375    12/01/05       1,639,645
 2,270    Montgomery Cnty, OH Hosp Rev Kettering Med Ctr
          Impt & Rfdg (MBIA Insd)........................  6.250    04/01/20       2,813,347
 1,000    Ohio St Air Quality Dev Auth Rev JMG Fdg Ltd
          Part Proj Rfdg (AMT) (AMBAC Insd)..............  6.375    04/01/29       1,023,300
</Table>

                                             See Notes to Financial Statements


                                      C-20

<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          OHIO (CONTINUED)
$2,500    Ohio St Bldg Auth St Fac Adult Correction Ser A
          Rfdg (FSA Insd)................................  5.500%   10/01/12   $   2,844,450
 1,000    Ohio St Higher Ed Cap Fac Ser II A.............  5.250    12/01/05       1,036,740
                                                                               -------------
                                                                                  35,744,359
                                                                               -------------
          OKLAHOMA  0.9%
 1,240    Kay Cnty, OK Home Fin Auth Rev Single Family
          Mtg Ser A Rfdg (Escrowed to Maturity) (AMBAC
          Insd)..........................................  7.000    11/01/11       1,519,744
 1,520    Oklahoma Hsg Fin Agy Single Family Rev Mtg
          Class B (AMT) (GNMA Collateralized)............  7.997    08/01/18       1,563,472
 2,305    Oklahoma St Cap Impt Auth St (MBIA Insd).......  5.000    06/01/06       2,416,839
                                                                               -------------
                                                                                   5,500,055
                                                                               -------------
          OREGON  2.1%
 4,000    Oregon Hlth Sciences Univ Insd Ser A (MBIA
          Insd)..........................................  5.250    07/01/22       4,323,680
 1,500    Oregon St Dept Admin Ser C Rfdg (MBIA Insd)....  5.250    11/01/17       1,669,860
 1,250    Portland, OR Cmnty College Dist Ser B..........  5.250    06/01/12       1,403,313
 1,500    Washington Multnomah & Yamhill Cntys, OR Sch
          Dist No 11 (MBIA Insd).........................  5.000    06/01/13       1,654,335
 3,195    Yamhill Cnty, OR Sch Dist No 029J Newberg (MBIA
          Insd) (f)......................................  5.250    06/15/18       3,551,882
                                                                               -------------
                                                                                  12,603,070
                                                                               -------------
          PENNSYLVANIA  5.9%
 2,500    Allegheny Cnty, PA San Auth Swr (MBIA Insd)....  5.500    12/01/30       2,726,100
 3,850    Greater Latrobe, PA Sch Auth (FGIC Insd) (f)...  5.250    04/01/16       4,294,945
 3,000    Harrisburg, PA Auth Res Gtd Sub Ser D-2
          (Variable Rate Coupon) (FSA Insd)..............  5.000    12/01/33       3,291,330
   210    Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
          Bible Fellowship Proj A Rfdg...................  5.000    12/15/05         210,130
   275    Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
          Bible Fellowship Proj A Rfdg (f)...............  5.100    12/15/06         276,790
   295    Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
          Bible Fellowship Proj A Rfdg (f)...............  5.250    12/15/07         298,744
   210    Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
          Bible Fellowship Proj A Rfdg...................  5.300    12/15/08         212,818
   320    Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
          Bible Fellowship Proj A Rfdg (f)...............  5.300    12/15/09         320,150
   240    Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
          Bible Fellowship Proj A Rfdg...................  5.400    12/15/10         238,824
 2,700    Pennsylvania Econ Dev Fin Auth Res Recovery Rev
          Colver Proj Ser D (AMT)........................  7.150    12/01/18       2,764,854
</Table>

See Notes to Financial Statements


                                      C-21
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          PENNSYLVANIA (CONTINUED)
$1,000    Pennsylvania St Tpk Commn Rev Ser T Rfdg (FGIC
          Insd)..........................................  5.500%   12/01/11   $   1,151,860
 1,000    Philadelphia, PA Auth Indl Dev Philadelphia
          Arpt Sys Proj Ser A (AMT) (FGIC Insd)..........  5.125    07/01/19       1,059,740
 2,600    Philadelphia, PA Auth Indl Ser B (FSA Insd)....  5.500    10/01/16       2,939,300
 3,200    Philadelphia, PA Gas Wks Rev 1998 Gen Ordinance
          4th Ser (FSA Insd).............................  5.250    08/01/19       3,494,048
 4,305    Philadelphia, PA Redev Auth Rev Neighborhood
          Transformation Ser A (FGIC Insd)...............  5.250    04/15/11       4,850,917
 1,500    Philadelphia, PA Sch Dist Ser A (Prerefunded @
          02/01/11) (FSA Insd)...........................  5.750    02/01/12       1,732,500
 5,205    Pittsburgh, PA Ser A (AMBAC Insd)..............  5.500    09/01/17       5,721,336
                                                                               -------------
                                                                                  35,584,386
                                                                               -------------
          RHODE ISLAND  0.5%
 2,495    Rhode Island St Hlth & Ed Higher Ed Johnson &
          Wales Rfdg (XLCA Insd).........................  5.375    04/01/18       2,756,002
                                                                               -------------

          SOUTH CAROLINA  0.7%
 2,000    Rock Hill, SC Util Sys Rev Comb Ser A Impt &
          Rfdg (FSA Insd)................................  5.375    01/01/18       2,218,660
   475    Rock Hill, SC Util Sys Rev Comb Ser C Rfdg (FSA
          Insd)..........................................  5.125    01/01/13         524,742
 1,500    South Carolina Jobs Econ Dev Auth Indl Rev Elec
          & Gas Co Proj Ser A (AMBAC Insd)...............  5.200    11/01/27       1,578,675
                                                                               -------------
                                                                                   4,322,077
                                                                               -------------
          SOUTH DAKOTA  0.3%
 1,905    Minnehaha Cnty, SD Ctf Ltd Tax (FSA Insd) (d)
          (f)............................................  5.000    12/01/19       2,058,695
                                                                               -------------

          TENNESSEE  1.6%
 4,000    Johnson City, TN Hlth & Ed Fac Brd Hosp Rev
          First Mtg Mtn St Hlth Ser A Rfdg (MBIA Insd)...  7.500    07/01/25       5,046,560
 2,500    Memphis, TN (Prerefunded @ 10/01/06)...........  5.250    10/01/14       2,680,175
</Table>

                                             See Notes to Financial Statements


                                      C-22

<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          TENNESSEE (CONTINUED)
$1,000    Metropolitan Nashville Arpt Auth TN Impt Ser A
          Rfdg (FGIC Insd)...............................  6.600%   07/01/14   $   1,195,160
   990    Tennessee Hsg Dev Agy Home Ownership Pgm 2-A
          (AMT)..........................................  5.700    07/01/31       1,027,689
                                                                               -------------
                                                                                   9,949,584
                                                                               -------------
          TEXAS  10.0%
 1,000    Brazos Cnty, TX Hlth Fac Dev Oblig Grp.........  5.375    01/01/32       1,015,840
 1,350    Cameron Cnty, TX Ctf Oblig (AMBAC Insd) (f)....  5.750    02/15/14       1,521,828
 2,500    Coastal Bend Hlth Fac Dev, TX Ser C (Inverse
          Fltg) (Escrowed to Maturity) (AMBAC Insd)......  8.138    11/15/13       3,411,275
 2,420    Dallas Cnty, TX Cmnty College Dist Rev Fin Sys
          (AMBAC Insd) (f)...............................  5.375    02/15/16       2,663,839
 2,000    Fort Worth, TX Wtr & Swr Rev Impt Rfdg.........  5.500    02/15/05       2,021,940
 1,745    Harris Cnty, TX Perm Impt & Rfdg...............  5.000    10/01/11       1,870,483
 3,345    Houston, TX Hotel Occupancy Tax Convtn &
          Entertnmnt Ser B (AMBAC Insd)..................  5.750    09/01/14       3,848,423
 6,790    Houston, TX Indpt Sch Dist Pub Fac Corp Lease
          Rev Cap Apprec West Side Ser B (AMBAC Insd)
          (f)............................................    *      09/15/14       4,529,813
   130    Houston, TX Pub Impt Rfdg (FSA Insd)...........  5.750    03/01/15         148,227
 1,370    Houston, TX Pub Impt Rfdg (Prerefunded
          09/01/10) (FSA Insd)...........................  5.750    03/01/15       1,566,253
10,000    Houston, TX Util Sys Rev First Lien Ser A Rfdg
          (FSA Insd).....................................  5.250    05/15/21      10,937,800
 4,000    Houston, TX Util Sys Rev First Lien Ser A Rfdg
          (FGIC Insd)....................................  5.250    05/15/23       4,325,760
 2,500    Houston, TX Wtr & Swr Sys Rev Jr Lien Ser B
          Rfdg (Escrowed to Maturity) (FGIC Insd)........  6.250    12/01/05       2,618,950
 1,250    Matagorda Cnty, TX Navig Dist No 1 Rev Coll
          Centerpoint Energy Proj Rfdg (Variable Rate
          Coupon)........................................  5.600    03/01/27       1,289,200
 1,000    Mesquite, TX Hlth Fac Dev Christian Care
          Retirement Fac Ser A...........................  7.625    02/15/28       1,052,370
 1,400    Metropolitan Hlth Fac Dev Corp TX Wilson N
          Jones Mem Hosp Proj............................  7.250    01/01/31       1,353,394
    50    North Central, TX Hlth Fac Dev Hosp Baylor Hlth
          Care Sys Proj A................................  5.125    05/15/29          50,818
 4,000    North Central, TX Hlth Fac Dev Hosp Childrens
          Med Ctr Dallas (AMBAC Insd)....................  5.250    08/15/32       4,177,200
 3,994    Region One Ed Svc Ctr Sub Tech Fac Proj
          (Acquired 12/30/97, Cost $3,993,700) (b).......  6.590    12/15/17       4,061,793
 4,000    San Antonio, TX Elec & Gas Rev Sys Rfdg........  5.375    02/01/18       4,466,080
 1,123    Texas Gen Svc Comm Part Int (Acquired 03/16/95,
          Cost $1,222,054) (b)...........................  7.250    08/01/11       1,140,726
</Table>

See Notes to Financial Statements


                                      C-23

<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          TEXAS (CONTINUED)
$   75    Texas Muni Pwr Agy Rev (Escrowed to Maturity)
          (MBIA Insd)....................................    *      09/01/15   $      48,154
 3,925    Texas Muni Pwr Agy Rev (Unrefunded Balance)
          (MBIA Insd)....................................    *      09/01/15       2,496,104
                                                                               -------------
                                                                                  60,616,270
                                                                               -------------
          VIRGINIA  2.2%
 1,320    Fairfax Cnty, VA Ctf Part......................  5.300%   04/15/23       1,417,654
 1,500    Henrico Cnty, VA Indl Dev Auth Pub Fac Lease
          Rev Henrico Cnty Regl Jail Proj (Prerefunded @
          08/01/05)......................................  6.500    08/01/10       1,582,710
 1,500    Henrico Cnty, VA Indl Dev Auth Pub Fac Lease
          Rev Henrico Cnty Regl Jail Proj (Prerefunded @
          08/01/05)......................................  7.125    08/01/21       1,589,715
 1,630    Richmond, VA (FSA Insd)........................  5.125    01/15/08       1,776,814
 1,340    Richmond, VA (FSA Insd)........................  5.500    01/15/10       1,515,620
 5,000    Virginia St Pub Sch Auth Sch Fin 1997
          Resolution Ser C...............................  5.000    08/01/20       5,383,200
                                                                               -------------
                                                                                  13,265,713
                                                                               -------------
          WASHINGTON  5.5%
 5,000    Bellevue, WA Convention Ctr Auth Spl Oblig Rev
          Rfdg (MBIA Insd)...............................    *      02/01/24       1,921,050
 3,230    Clark Cnty, WA Pub Util Dist No. 001 Gen Sys
          Rev Rfdg (FSA Insd) (f)........................  5.500    01/01/07       3,465,112
 3,000    Clark Cnty, WA Pub Util Dist No. 001 Gen Sys
          Rev Rfdg (FSA Insd)............................  5.625    01/01/12       3,366,150
 5,000    Cowlitz Cnty, WA Spl Swr Rev CSOB Wastewtr
          Treatment Rfdg (FGIC Insd).....................  5.500    11/01/19       5,843,150
 5,000    Energy Northwest WA Elec Rev Proj No 3 Ser A
          Rfdg...........................................  5.500    07/01/17       5,589,400
 3,000    Energy Northwest WA Elec Rev Proj No 3 Ser A
          Rfdg (FSA Insd)................................  5.500    07/01/18       3,372,210
 5,000    King Cnty, WA Ser B Rfdg (MBIA Insd)...........  5.250    01/01/34       5,233,000
 1,000    Port Seattle, WA Rev Ser B (AMT) (MBIA Insd)...  5.625    02/01/24       1,085,740
 1,345    Tacoma, WA Elec Sys Rev Ser A Rfdg (FSA
          Insd)..........................................  5.750    01/01/15       1,532,103
 1,750    Washington St Pub Pwr Supply Sys Nuclear Proj
          No 1 Rev (MBIA Insd)...........................  5.750    07/01/12       1,885,888
                                                                               -------------
                                                                                  33,293,803
                                                                               -------------
</Table>

                                            See Notes to Financial Statements


                                      C-24
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                      COUPON   MATURITY       VALUE
- --------------------------------------------------------------------------------------------
<C>       <S>                                              <C>      <C>        <C>
          WEST VIRGINIA  1.1%
$6,550    Harrison Cnty, WV Cnty Cmnty Solid Waste Disp
          Rev Potomac Edison Co Ser A (AMT) (MBIA Insd)
          (f)............................................  6.875%   04/15/22   $   6,575,611
                                                                               -------------

          WISCONSIN  0.9%
 5,000    Wisconsin St Hlth & Ed Fac Auth Mercy Hlth Sys
          Corp (AMBAC Insd)..............................  5.500    08/15/25       5,387,100
                                                                               -------------

          GUAM  0.9%
 5,000    Guam Pwr Auth Rev Ser A (AMBAC Insd)...........  5.250    10/01/34       5,285,800
                                                                               -------------

          PUERTO RICO  1.0%
 2,000    Puerto Rico Muni Fin Agy Ser A (FSA Insd)......  5.250    08/01/20       2,228,340
 3,500    Puerto Rico Pub Bldgs Auth Rev Govt Facs Ser I
          (Comwth Gtd)...................................  5.250    07/01/33       3,667,405
                                                                               -------------
                                                                                   5,895,745
                                                                               -------------
TOTAL LONG-TERM INVESTMENTS  148.1%
  (Cost $832,047,426).......................................................     894,019,978
SHORT-TERM INVESTMENTS  1.1%
  (Cost $6,400,000).........................................................       6,400,000
                                                                               -------------

TOTAL INVESTMENTS  149.2%
  (Cost $838,447,426).......................................................     900,419,978
OTHER ASSETS IN EXCESS OF LIABILITIES  0.5%.................................       3,329,717
PREFERRED SHARES (INCLUDING ACCRUED DISTRIBUTIONS)  (49.7%).................    (300,116,361)
                                                                               -------------

NET ASSETS APPLICABLE TO COMMON SHARES  100.0%..............................   $ 603,633,334
                                                                               =============
</Table>

Percentages are calculated as a percentage of net assets applicable to common
shares.

*   Zero coupon bond

(a) All or a portion of these securities have been physically segregated in
    connection with open futures contracts.

(b) These securities are restricted and may be resold only in transactions
    exempt from registration which are normally those transactions with
    qualified institutional buyers. Restricted Securities comprise 4.4% of net
    assets applicable to common shares.

(c) 144A securities are those which are exempt from registration under Rule 144A
    of the Securities Act of 1933, as amended. These securities may only be
    resold in transactions exempt from registration which are normally those
    transactions with qualified institutional buyers.

(d) Securities purchased on a when-issued or delayed delivery basis.

(e) Security converts to a fixed coupon rate at a predetermined date.

(f) The Trust owns 100% of the bond issuance.

ACA--American Capital Access

See Notes to Financial Statements


                                      C-25
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

AMBAC--AMBAC Indemnity Corp.

AMT--Alternative Minimum Tax

Comwth Gtd--Commonwealth of Puerto Rico

FGIC--Financial Guaranty Insurance Co.

FSA--Financial Security Assurance Inc.

GNMA--Government National Mortgage Association

MBIA--Municipal Bond Investors Assurance Corp.

XLCA--XL Capital Assurance Inc.

                                            See Notes to Financial Statements


                                      C-26
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities
October 31, 2004

<Table>
<S>                                                           <C>
ASSETS:
Total Investments (Cost $838,447,426).......................  $900,419,978
Cash........................................................        31,897
Receivables:
  Interest..................................................    11,989,459
  Investments Sold..........................................     2,839,753
Other.......................................................        15,611
                                                              ------------
    Total Assets............................................   915,296,698
                                                              ------------
LIABILITIES:
Payables:
  Investments Purchased.....................................    10,326,321
  Investment Advisory Fee...................................       457,720
  Income Distributions--Common Shares.......................       138,245
  Other Affiliates..........................................        34,355
  Variation Margin on Futures...............................         5,438
Trustees' Deferred Compensation and Retirement Plans........       369,938
Accrued Expenses............................................       214,986
                                                              ------------
    Total Liabilities.......................................    11,547,003
Preferred Shares (including accrued distributions)..........   300,116,361
                                                              ------------
NET ASSETS APPLICABLE TO COMMON SHARES......................  $603,633,334
                                                              ============
NET ASSET VALUE PER COMMON SHARE ($603,633,334 divided by
  36,365,393 shares outstanding)............................  $      16.60
                                                              ============
NET ASSETS CONSIST OF:
Common Shares ($.01 par value with an unlimited number of
  shares authorized, 36,365,393 shares issued and
  outstanding)..............................................  $    363,654
Paid in Surplus.............................................   538,413,497
Net Unrealized Appreciation.................................    61,956,652
Accumulated Undistributed Net Investment Income.............     3,813,714
Accumulated Net Realized Loss...............................      (914,183)
                                                              ------------
NET ASSETS APPLICABLE TO COMMON SHARES......................  $603,633,334
                                                              ============
PREFERRED SHARES ($.01 par value, authorized 100,000,000
  shares, 12,000 issued with liquidation preference of
  $25,000 per share)........................................  $300,000,000
                                                              ============
NET ASSETS INCLUDING PREFERRED SHARES.......................  $903,633,334
                                                              ============
</Table>

See Notes to Financial Statements


                                      C-27
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

FINANCIAL STATEMENTS continued

Statement of Operations
For the Year Ended October 31, 2004

<Table>
<S>                                                           <C>
INVESTMENT INCOME:
Interest....................................................  $44,193,797
                                                              -----------
EXPENSES:
Investment Advisory Fee.....................................    5,364,429
Preferred Share Maintenance.................................      801,595
Administrative Fee..........................................      261,204
Trustees' Fees and Related Expenses.........................      152,106
Legal.......................................................       81,836
Custody.....................................................       50,288
Other.......................................................      387,907
                                                              -----------
    Total Expenses..........................................    7,099,365
    Less Credits Earned on Cash Balances....................          508
                                                              -----------
    Net Expenses............................................    7,098,857
                                                              -----------
NET INVESTMENT INCOME.......................................  $37,094,940
                                                              ===========
REALIZED AND UNREALIZED GAIN/LOSS:
Realized Gain/Loss:
  Investments...............................................  $  (748,208)
  Futures...................................................     (440,822)
                                                              -----------
Net Realized Loss...........................................   (1,189,030)
                                                              -----------
Unrealized Appreciation/Depreciation:
  Beginning of the Period...................................   46,947,631
                                                              -----------
  End of the Period:
    Investments.............................................   61,972,552
    Futures.................................................      (15,900)
                                                              -----------
                                                               61,956,652
                                                              -----------
Net Unrealized Appreciation During the Period...............   15,009,021
                                                              -----------
NET REALIZED AND UNREALIZED GAIN............................  $13,819,991
                                                              ===========
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS.....................  $(3,258,016)
                                                              ===========
NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM
  OPERATIONS................................................  $47,656,915
                                                              ===========
</Table>

                                             See Notes to Financial Statements


                                      C-28

<PAGE>



VAN KAMPEN MUNICIPAL TRUST

FINANCIAL STATEMENTS continued

Statements of Changes in Net Assets

<Table>
<Caption>
                                                              FOR THE             FOR THE
                                                             YEAR ENDED          YEAR ENDED
                                                          OCTOBER 31, 2004    OCTOBER 31, 2003
                                                          ------------------------------------
<S>                                                       <C>                 <C>
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Income...................................    $ 37,094,940        $ 37,242,943
Net Realized Gain/Loss..................................      (1,189,030)          2,809,023
Net Unrealized Appreciation During the Period...........      15,009,021           1,757,060
Distributions to Preferred Shareholders:
  Net Investment Income.................................      (3,180,653)         (3,055,413)
  Net Realized Gain.....................................         (77,363)                -0-
                                                            ------------        ------------
Change in Net Assets Applicable to Common Shares from
  Operations............................................      47,656,915          38,753,613
Distributions to Common Shareholders:
  Net Investment Income.................................     (34,036,953)        (34,036,119)
  Net Realized Gain.....................................        (868,390)                -0-
                                                            ------------        ------------

NET CHANGE IN NET ASSETS APPLICABLE TO COMMON SHARES
  FROM INVESTMENT ACTIVITIES............................      12,751,572           4,717,494

NET ASSETS APPLICABLE TO COMMON SHARES:
Beginning of the Period.................................     590,881,762         586,164,268
                                                            ------------        ------------
End of the Period (Including accumulated undistributed
  net investment income of $3,813,714 and $3,974,030,
  respectively).........................................    $603,633,334        $590,881,762
                                                            ============        ============
</Table>

See Notes to Financial Statements


                                      C-29
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

FINANCIAL HIGHLIGHTS

THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE COMMON SHARE OF THE
TRUST OUTSTANDING THROUGHOUT THE PERIODS INDICATED.

<Table>
<Caption>

                                                              ------------------------------
                                                               2004       2003      2002 (a)
                                                              ------------------------------
<S>                                                           <C>        <C>        <C>
NET ASSET VALUE, BEGINNING OF THE PERIOD....................  $ 16.25    $ 16.12    $ 16.07
                                                              -------    -------    -------
  Net Investment Income.....................................     1.03       1.02       1.06
  Net Realized and Unrealized Gain/Loss.....................      .37        .13        .01
  Common Share Equivalent of Distributions Paid to Preferred
  Shareholders:
    Net Investment Income...................................     (.09)      (.08)      (.11)
    Net Realized Gain.......................................      -0-(f)     -0-        -0-
                                                              -------    -------    -------
Total from Investment Operations............................     1.31       1.07        .96
Distributions Paid to Common Shareholders:
    Net Investment Income...................................     (.94)      (.94)      (.91)
    Net Realized Gain.......................................     (.02)       -0-        -0-
                                                              -------    -------    -------
NET ASSET VALUE, END OF THE PERIOD..........................  $ 16.60    $ 16.25    $ 16.12
                                                              =======    =======    =======

Common Share Market Price at End of the Period..............  $ 14.90    $ 14.57    $ 14.30
Total Return (b)............................................    9.15%      8.60%     10.49%
Net Assets Applicable to Common Shares at End of the Period
  (In millions).............................................  $ 603.6    $ 590.9    $ 586.2
Ratio of Expenses to Average Net Assets Applicable to Common
  Shares (c)................................................    1.19%      1.23%      1.35%
Ratio of Net Investment Income to Average Net Assets
  Applicable to Common Shares (c)...........................    6.24%      6.28%      6.70%
Portfolio Turnover..........................................      19%        24%        38%

SUPPLEMENTAL RATIOS:
Ratio of Expenses to Average Net Assets Including Preferred
  Shares (c)................................................     .79%       .81%       .89%
Ratio of Net Investment Income to Average Net Assets
  Applicable to Common Shares (d)...........................    5.70%      5.77%      5.98%

SENIOR SECURITIES:
Total Preferred Shares Outstanding..........................   12,000     12,000     12,000
Asset Coverage Per Preferred Share (e)......................  $75,312    $74,245    $73,861
Involuntary Liquidating Preference Per Preferred Share......  $25,000    $25,000    $25,000
Average Market Value Per Preferred Share....................  $25,000    $25,000    $25,000
</Table>

*  Non-Annualized

(a)As required, effective November 1, 2001, the Trust has adopted the provisions
   of the AICPA Audit and Accounting Guide for Investment Companies and began
   accreting market discount on fixed income securities. The effect of this
   change for the year ended October 31, 2002 was to increase net investment
   income per share by $.01, decrease net realized and unrealized gains and
   losses per share by $.01 and increase the ratio of net investment income to
   average net assets applicable to common shares from 6.69% to 6.70%. Per
   share, ratios and supplemental data for periods prior to October 31, 2002
   have not been restated to reflect this change in presentation.

(b)Total return assumes an investment at the common share market price at the
   beginning of the period indicated, reinvestment of all distributions for the
   period in accordance with the Trust's dividend reinvestment plan, and sale of
   all shares at the closing common share market price at the end of the period
   indicated.

(c)Ratios do not reflect the effect of dividend payments to preferred
   shareholders.

(d)Ratios reflect the effect of dividend payments to preferred shareholders.

(e)Calculated by subtracting the Trust's total liabilities (not including the
   preferred shares) from the Trust's total assets and dividing this by the
   number of preferred shares outstanding.

(f)Amount is less than $0.01 per share.



                                      C-30
<PAGE>



<Table>
<Caption>
                                        TWO
                                      MONTHS
YEAR ENDED OCTOBER 31,                 ENDED                YEAR ENDED AUGUST 31,
- ---------------------------------   OCTOBER 31,   -----------------------------------------
      2001      2000       1999        1998         1998       1997       1996       1995
- -------------------------------------------------------------------------------------------
<S>  <C>       <C>       <C>        <C>           <C>        <C>        <C>        <C>
     $ 14.91   $ 14.60   $  17.39    $  17.32     $  16.60   $  15.84   $  15.73   $  15.56
     -------   -------   --------    --------     --------   --------   --------   --------
        1.13      1.17       1.20         .21         1.26       1.28       1.30       1.31
        1.12       .42      (2.30)        .08          .72        .73        .10        .26
        (.27)     (.34)      (.24)       (.02)        (.30)      (.29)      (.30)      (.32)
         -0-       -0-       (.06)       (.04)         -0-        -0-        -0-        -0-
     -------   -------   --------    --------     --------   --------   --------   --------
        1.98      1.25      (1.40)        .23         1.68       1.72       1.10       1.25
        (.82)     (.94)      (.96)       (.16)        (.96)      (.96)      (.99)     (1.08)
         -0-       -0-       (.43)        -0-          -0-        -0-        -0-        -0-
     -------   -------   --------    --------     --------   --------   --------   --------
     $ 16.07   $ 14.91   $  14.60    $  17.39     $  17.32   $  16.60   $  15.84   $  15.73
     =======   =======   ========    ========     ========   ========   ========   ========

     $ 13.79   $12.625   $13.1875    $16.8125     $16.1875   $  15.75   $  14.50   $  14.25
      15.97%     2.80%    -14.47%       4.84%*       9.06%     15.87%      8.98%      2.39%
     $ 584.4   $ 542.1   $  530.9    $  630.6     $  628.2   $  601.9   $  574.6   $  570.7
       1.55%     1.67%      1.60%       1.57%        1.57%      1.61%      1.61%      1.65%
       7.26%     8.07%      7.43%       7.20%        7.42%      7.86%      8.08%      8.58%
         28%       39%        80%          6%*         94%        54%        36%        49%

       1.01%     1.07%      1.06%       1.07%        1.06%      1.07%      1.06%      1.07%
       5.51%     5.71%      5.95%       6.48%        5.66%      6.04%      6.20%      6.48%

      12,000    12,000     12,000       6,000        6,000      6,000      6,000      6,000
     $73,700   $70,177   $ 69,241    $155,104     $154,696   $150,322   $145,764   $145,113
     $25,000   $25,000   $ 25,000    $ 50,000     $ 50,000   $ 50,000   $ 50,000   $ 50,000
     $25,000   $25,000   $ 25,000    $ 50,000     $ 50,000   $ 50,000   $ 50,000   $ 50,000
</Table>

See Notes to Financial Statements


                                      C-31

<PAGE>



VAN KAMPEN MUNICIPAL TRUST

NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004

1. SIGNIFICANT ACCOUNTING POLICIES

Van Kampen Municipal Trust (the "Trust") is registered as a diversified,
closed-end management investment company under the Investment Company Act of
1940, as amended. The Trust's investment objective is to seek to provide a high
level of current income exempt from federal income tax, consistent with
preservation of capital. The Trust will invest in a portfolio consisting
substantially of municipal obligations rated investment grade at the time of
investment, but may invest up to 20% of its assets in unrated securities which
are believed to be of comparable quality to those rated investment grade. The
Trust commenced investment operations on September 27, 1991. Effective November
30, 2003, the Trust's investment adviser, Van Kampen Investment Advisory Corp.
merged into its affiliate, Van Kampen Asset Management (the "Adviser").

    The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

A. SECURITY VALUATION Municipal bonds are valued by independent pricing services
or dealers using the mean of the bid and asked prices or, in the absence of
market quotations, at fair value based upon yield data relating to municipal
bonds with similar characteristics and general market conditions. Securities
which are not valued by independent pricing services or dealers are valued at
fair value using procedures established in good faith by the Board of Trustees.
Short-term securities with remaining maturities of 60 days or less are valued at
amortized cost, which approximates market value.

B. SECURITY TRANSACTIONS Security transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis. The
Trust may purchase and sell securities on a "when-issued" or "delayed delivery"
basis, with settlement to occur at a later date. The value of the security so
purchased is subject to market fluctuations during this period. The Trust will
segregate assets with the custodian having an aggregate value at least equal to
the amount of the when-issued or delayed delivery purchase commitments until
payment is made. At October 31, 2004, the Trust had $10,326,321 of when-issued
and delayed delivery purchase commitments.

C. INVESTMENT INCOME Interest income is recorded on an accrual basis. Bond
premium is amortized and discount is accreted over the expected life of each
applicable security.

D. FEDERAL INCOME TAXES It is the Trust's policy to comply with the requirements
of the Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no provision for federal income taxes is required.

    The Trust intends to utilize provisions of the federal income tax laws which
allow it to carry a realized capital loss forward for eight years following the
year of the loss and offset such losses against any future realized capital
gains. At October 31, 2004, the Trust had an



                                      C-32


<PAGE>



VAN KAMPEN MUNICIPAL TRUST

NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued

accumulated capital loss carryforward for tax purposes of $930,080, which will
expire on October 31, 2012.

    At October 31, 2004, the cost and related gross unrealized appreciation and
depreciation are as follows:

<Table>
<S>                                                             <C>
Cost of investments for tax purposes........................    $837,846,231
                                                                ============
Gross tax unrealized appreciation...........................    $ 63,518,261
Gross tax unrealized depreciation...........................        (944,514)
                                                                ------------
Net tax unrealized appreciation on investments..............    $ 62,573,747
                                                                ============
</Table>

E. DISTRIBUTION OF INCOME AND GAINS The Trust declares and pays monthly
dividends from net investment income to common shareholders. Net realized gains,
if any, are distributed annually on a pro rata basis to common and preferred
shareholders. Distributions from net realized gains for book purposes may
include short-term capital gains, which are included as ordinary income for tax
purposes.

    The tax character of distributions paid during the years ended October 31,
2004 and 2003 was as follows:

<Table>
<Caption>
                                                                 2004         2003
<S>                                                           <C>           <C>
Distribution paid from:
  Ordinary Income...........................................  $   71,612    $190,906
  Long-term capital gain....................................     945,753         -0-
                                                              ----------    --------
                                                              $1,017,365    $190,906
                                                              ==========    ========
</Table>

    Due to inherent differences in the recognition of income, expenses and
realized gains/losses under accounting principles generally accepted in the
United States of America and federal income tax purposes, permanent differences
between book and tax basis reporting have been identified and appropriately
reclassified on the Statement of Assets and Liabilities. A permanent book and
tax difference of $37,650 related to book and tax accretion differences was
reclassified from accumulated undistributed net investment income to accumulated
net realized loss.

    As of October 31, 2004, the components of distributable earnings on a tax
basis were as follows:

<Table>
<S>                                                             <C>
Undistributed ordinary income...............................    $198,860
</Table>

    Net realized gains or losses may differ for financial and tax reporting
purposes primarily as a result of gains or losses recognized for tax purposes on
open futures transactions on October 31, 2004.

F. EXPENSE REDUCTION During the year ended October 31, 2004, the Trust's custody
fee was reduced by $508 as a result of credits earned on cash balances.




                                      C-33

<PAGE>



VAN KAMPEN MUNICIPAL TRUST

NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued

2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES

Under the terms of the Trust's Investment Advisory Agreement, the Adviser
provides investment advice and facilities to the Trust for an annual fee payable
monthly of .60% of the average daily net assets of the Trust. Effective November
1, 2004, the investment advisory fee was reduced from .60% to .55%. In addition,
the Trust paid a monthly administrative fee to Van Kampen Investments Inc. or
its affiliates (collectively "Van Kampen"), the Trust's Administrator, at an
annual rate of .05% of the average daily net assets of the Trust. Effective June
1, 2004, the administrative fee was reduced from .05% to .00%.

    For the year ended October 31, 2004, the Trust recognized expenses of
approximately $55,000 representing legal services provided by Skadden, Arps,
Slate, Meagher & Flom LLP, counsel to the Trust, of which a trustee of the Trust
is a partner who provides legal services to the Trust, and is therefore an
affiliated person.

    Under separate Accounting Services and Legal Services agreements, the
Adviser provides accounting and legal services to the Trust. The Adviser
allocates the cost of such services to each trust. For the year ended October
31, 2004, the Trust recognized expenses of approximately $65,400 representing
Van Kampen's cost of providing accounting and legal services to the Trust, which
are reported as part of "Other" and "Legal" expenses, respectively, in the
Statement of Operations.

    Certain officers and trustees of the Trust are also officers and directors
of Van Kampen. The Trust does not compensate its officers or trustees who are
also officers of Van Kampen.

    The Trust provides deferred compensation and retirement plans for its
trustees who are not officers of Van Kampen. Under the deferred compensation
plan, trustees may elect to defer all or a portion of their compensation to a
later date. Benefits under the retirement plan are payable upon retirement for a
ten-year period and are based upon each trustee's years of service to the Trust.
The maximum annual benefit per trustee under the plan is $2,500.

3. INVESTMENT TRANSACTIONS

During the period, the cost of purchases and proceeds from sales of investments,
excluding short-term investments, were $165,364,191 and $164,885,171,
respectively.

4. DERIVATIVE FINANCIAL INSTRUMENTS

A derivative financial instrument in very general terms refers to a security
whose value is "derived" from the value of an underlying asset, reference rate
or index.

    In order to seek to manage the interest rate exposure of the Trust's
portfolio in a changing interest rate environment, the Trust may purchase or
sell financial futures contracts or engage in transactions involving interest
rate swaps, caps, floors or collars. The Trust expects to enter into these
transactions primarily as a hedge against anticipated interest rate or
fixed-income market changes, for duration management or for risk management
purposes, but may also enter into these transactions to generate additional
income. All of the Trust's portfolio holdings, including derivative instruments,
are marked to market each day with the change in value reflected in the
unrealized appreciation/depreciation. Upon disposition, a realized gain or loss
is recognized accordingly, except when taking delivery of a security underlying
a futures contract. In this instance, the recognition of gain or loss is
postponed until the disposal of the security underlying the futures contract.
Risks may arise as a result of the potential inability of the counterparties to
meet the terms of their contracts.



                                      C-34

<PAGE>



VAN KAMPEN MUNICIPAL TRUST

NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued

    Summarized below are the specific types of derivative financial instruments
used by the Fund.

A. FUTURES CONTRACTS A futures contract is an agreement involving the delivery
of a particular asset on a specified future date at an agreed upon price. The
Trust generally invests in exchange traded futures contracts on U.S. Treasury
Bonds and Notes and typically closes the contract prior to the delivery date.
Futures contracts are valued at the settlement price established each day on the
exchange on which they are traded.

    Upon entering into futures contracts, the Trust maintains an amount of cash
or liquid securities with a value equal to a percentage of the contract amount
with either a future commission merchant pursuant to rules and regulations
promulgated under the 1940 Act, as amended, or with its custodian in an account
in the broker's name. This amount is known as initial margin. During the period
the futures contract is open, payments are received from or made to the broker
based upon changes in the value of the contract (the variation margin). The risk
of loss associated with a futures contract is in excess of the variation margin
reflected on the Statement of Assets and Liabilities.

    Transactions in futures contracts for the year ended October 31, 2004, were
as follows:

<Table>
<Caption>
                                                                CONTRACTS
<S>                                                             <C>
Outstanding at October 31, 2003.............................        98
Futures Opened..............................................       104
Futures Closed..............................................      (180)
                                                                  ----
Outstanding at October 31, 2004.............................        22
                                                                  ====
</Table>

    The futures contracts outstanding as of October 31, 2004, and the
descriptions and unrealized appreciation/depreciation are as follows:

<Table>
<Caption>
                                                                            UNREALIZED
SHORT CONTRACTS                                               CONTRACTS    DEPRECIATION
<S>                                                           <C>          <C>
U.S. Treasury Notes 10-Year Futures
  December 2004 (Current Notional Value of $113,563 per
    contract)...............................................      4          $ (4,578)
U.S. Treasury Notes 5-Year Futures
  December 2004 (Current Notional Value of $111,375 per
    contract)...............................................     18           (11,322)
                                                                 --          --------
                                                                 22          $(15,900)
                                                                 ==          ========
</Table>

B. INVERSE FLOATING RATE SECURITIES An Inverse Floating Rate security is one
where the coupon is inversely indexed to a short-term floating interest rate
multiplied by a specified factor. As the floating rate rises, the coupon is
reduced. Conversely as the floating rate declines, the coupon is increased. The
price of these securities may be more volatile than the price of a comparable
fixed rate security. These instruments are typically used by the Trust to
enhance the yield of the portfolio.

5. PREFERRED SHARES

The Trust has outstanding 12,000 Auction Preferred Shares ("APS") in four series
of 3,000 shares each. Dividends are cumulative and the dividend rate is
periodically reset through an auction process. The dividend periods for Series A
and C are generally 7 days.



                                      C-35
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued

The dividend periods for Series B and D are 28 days. The average rate in effect
on October 31, 2004 was 1.538%. During the year ended October 31, 2004, the
rates ranged from 0.590% to 1.760%.

    The Trust pays annual fees equivalent to .25% of the preferred share
liquidation value for the remarketing efforts associated with the preferred
auctions. These fees are included as a component of "Preferred Share
Maintenance" expense in the Statement of Operations.

    The APS are redeemable at the option of the Trust in whole or in part at the
liquidation value of $25,000 per share plus accumulated and unpaid dividends.
The Trust is subject to certain asset coverage tests, and the APS are subject to
mandatory redemption if the tests are not met.

6. INDEMNIFICATIONS

The Trust enters into contracts that contain a variety of indemnifications. The
Trust's maximum exposure under these arrangements is unknown. However, the Trust
has not had prior claims or losses pursuant to these contracts and expects the
risk of loss to be remote.



                                      C-36
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Trustees and Shareholders of Van Kampen Municipal Trust

We have audited the accompanying statement of assets and liabilities of Van
Kampen Municipal Trust (the "Trust"), including the portfolio of investments, as
of October 31, 2004, the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the five years in
the period then ended. These financial statements and financial highlights are
the responsibility of the Trust's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on our
audits. The Trust's financial highlights for the periods ended prior to October
31, 2000 were audited by other auditors whose report, dated December 6, 1999,
expressed an unqualified opinion on those financial highlights.

    We conducted our audits in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned as of October 31, 2004, by correspondence with the Trust's
custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

    In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of Van
Kampen Municipal Trust as of October 31, 2004, the results of its operations for
the year then ended, the changes in its net assets and the financial highlights
for the respective stated periods, in conformity with accounting principles
generally accepted in the United States of America.

DELOITTE & TOUCHE LLP
Chicago, Illinois
December 10, 2004



                                      C-37
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

DIVIDEND REINVESTMENT PLAN

    The Trust offers a dividend reinvestment plan (the "Plan") pursuant to which
Common Shareholders may elect to have dividends and capital gains distributions
reinvested in Common Shares of the Trust. The Trust declares dividends out of
net investment income, and will distribute annually net realized capital gains,
if any. Common Shareholders may join or withdraw from the Plan at any time.

    If you decide to participate in the Plan, State Street Bank and Trust
Company, as your Plan Agent, will automatically invest your dividends and
capital gains distributions in Common Shares of the Trust for your account.

HOW TO PARTICIPATE

    If you wish to participate and your shares are held in your own name, call
1-800-341-2929 for more information and a Plan brochure. If your shares are held
in the name of a brokerage firm, bank, or other nominee, you should contact your
nominee to see if it would participate in the Plan on your behalf. If you wish
to participate in the Plan, but your brokerage firm, bank or nominee is unable
to participate on your behalf, you should request that your shares be
re-registered in your own name which will enable your participation in the Plan.

HOW THE PLAN WORKS

    Participants in the Plan will receive the equivalent in Common Shares valued
on the valuation date, generally at the lower of market price or net asset
value, except as specified below. The valuation date will be the dividend or
distribution payment date or, if that date is not a trading day on the national
securities exchange or market system on which the Common Shares are listed for
trading, the next preceding trading day. If the market price per Common Share on
the valuation date equals or exceeds net asset value per Common Share on that
date, the Trust will issue new Common Shares to participants valued at the
higher of net asset value or 95% of the market price on the valuation date. In
the foregoing situation, the Trust will not issue Common Shares under the Plan
below net asset value. If net asset value per Common Share on the valuation date
exceeds the market price per Common Share on that date, or if the Board of
Trustees should declare a dividend or capital gains distribution payable to the
Common Shareholders only in cash, participants in the Plan will be deemed to
have elected to receive Common Shares from the Trust valued at the market price
on that date. Accordingly, in this circumstance, the Plan Agent will, as agent
for the participants, buy the Trust's Common Shares in the open market for the
participants' accounts on or shortly after the payment date. If, before the Plan
Agent has completed its purchases, the market price exceeds the net asset value
per share of the Common Shares, the average per share purchase price paid by the
Plan Agent may exceed the net asset value



                                      C-38
<PAGE>

VAN KAMPEN MUNICIPAL TRUST


DIVIDEND REINVESTMENT PLAN continued

of the Trust's Common Shares, resulting in the acquisition of fewer Common
Shares than if the dividend or distribution had been paid in Common Shares
issued by the Trust. All reinvestments are in full and fractional Common Shares
and are carried to three decimal places.

    Experience under the Plan may indicate that changes are desirable.
Accordingly, the Trust reserves the right to amend or terminate the Plan as
applied to any dividend or distribution paid subsequent to written notice of the
changes sent to all Common Shareholders of the Trust at least 90 days before the
record date for the dividend or distribution. The Plan also may be amended or
terminated by the Plan Agent by at least 90 days written notice to all Common
Shareholders of the Trust.

COSTS OF THE PLAN

    The Plan Agent's fees for the handling of the reinvestment of dividends and
distributions will be paid by the Trust. However, each participant will pay a
prorata share of brokerage commissions incurred with respect to the Plan Agent's
open market purchases in connection with the reinvestment of dividends and
distributions. No other charges will be made to participants for reinvesting
dividends or capital gains distributions, except for certain brokerage
commissions, as described above.

TAX IMPLICATIONS

    You will receive tax information annually for your personal records and to
help you prepare your federal income tax return. The automatic reinvestment of
dividends and capital gains distributions does not relieve you of any income tax
which may be payable on dividends or distributions.

RIGHT TO WITHDRAW

    Plan participants may withdraw at any time by calling 1-800-341-2929 or by
writing State Street Bank and Trust Company, P.O. Box 8200, Boston, MA
02266-8200. If you withdraw, you will receive, without charge, a share
certificate issued in your name for all full Common Shares credited to your
account under the Plan and a cash payment will be made for any fractional Common
Share credited to your account under the Plan. You may again elect to
participate in the Plan at any time by calling 1-800-341-2929 or writing to the
Trust at:

                              Van Kampen Funds Inc.
                              Attn: Closed-End Funds
                                2800 Post Oak Blvd.
                                 Houston, TX 77056




                                      C-39
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

BOARD OF TRUSTEES AND IMPORTANT ADDRESSES

BOARD OF TRUSTEES

DAVID C. ARCH
J. MILES BRANAGAN
JERRY D. CHOATE
ROD DAMMEYER
LINDA HUTTON HEAGY
R. CRAIG KENNEDY
HOWARD J KERR
MITCHELL M. MERIN*
JACK E. NELSON
RICHARD F. POWERS, III*
HUGO F. SONNENSCHEIN
WAYNE W. WHALEN* - Chairman
SUZANNE H. WOOLSEY

INVESTMENT ADVISER

VAN KAMPEN ASSET MANAGEMENT
1221 Avenue of the Americas
New York, New York 10020

CUSTODIAN AND TRANSFER AGENT

STATE STREET BANK
AND TRUST COMPANY
c/o EquiServe
P.O. Box 43011
Providence, Rhode Island 02940-3011


LEGAL COUNSEL

SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
333 West Wacker Drive
Chicago, Illinois 60606

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

DELOITTE & TOUCHE LLP
180 North Stetson Avenue
Chicago, Illinois 60601

 For federal income tax purposes, the following information is furnished with
 respect to the distributions paid by the Trust during its taxable year ended
 October 31, 2004. The Trust designated 99.8% of the income distributions as a
 tax-exempt income distribution. The Trust designated and paid $945,753 as a
 long-term capital gain distribution. In January, the Trust provides tax
 information to shareholders for the preceding calendar year.

*   "Interested persons" of the Trust, as defined in the Investment Company Act
    of 1940, as amended.


                                      C-40
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

RESULTS OF SHAREHOLDER VOTES

The Annual Meeting of the Shareholders of the Trust was held on June 23, 2004,
where shareholders voted on the election of trustees.

1) With regard to the election of the following trustees by the common
shareholders of the Trust:

<Table>
<Caption>
                                                                     # OF SHARES
                                                            ------------------------------
                                                             IN FAVOR             WITHHELD
- ------------------------------------------------------------------------------------------
<S>                                                         <C>                   <C>
R. Craig Kennedy..........................................  32,083,886            845,041
Jack E. Nelson............................................  32,063,916            865,011
Richard F. Powers, III....................................  32,091,066            837,861
</Table>

2) With regard to the election of the following trustee by the preferred
shareholders of the Trust:

<Table>
<Caption>
                                                                      # OF SHARES
                                                              ----------------------------
                                                              IN FAVOR            WITHHELD
- ------------------------------------------------------------------------------------------
<S>                                                           <C>                 <C>
Hugo Sonnenschein...........................................   10,306                44
</Table>

The other trustees of the Trust whose terms did not expire in 2004 are David C.
Arch, J. Miles Branagan, Jerry D. Choate, Rod Dammeyer, Linda Hutton Heagy,
Howard J Kerr, Mitchell M. Merin, Wayne W. Whalen, and Suzanne H. Woolsey.



                                      C-41
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

TRUSTEE AND OFFICER INFORMATION

The business and affairs of the Trust are managed under the direction of the
Trust's Board of Trustees and the Trust's officers appointed by the Board of
Trustees. The tables below list the trustees and executive officers of the Trust
and their principal occupations during the last five years, other directorships
held by trustees and their affiliations, if any, with Van Kampen Investments
Inc. ("Van Kampen Investments"), Van Kampen Asset Management (the "Adviser"),
Van Kampen Funds Inc. (the "Distributor"), Van Kampen Advisors Inc., Van Kampen
Exchange Corp. and Van Kampen Investor Services Inc. ("Investor Services"). The
term "Fund Complex" includes each of the investment companies advised by the
Adviser or its affiliates as of the date of this Statement of Additional
Information. Trustees serve until reaching their retirement age or until their
successors are duly elected and qualified. Officers are annually elected by the
trustees.

INDEPENDENT TRUSTEES:

<Table>
<Caption>
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE           TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>
David C. Arch (59)            Trustee      Trustee     Chairman and Chief             85       Trustee/Director/Managing
Blistex Inc.                               since 1991  Executive Officer of                    General Partner of funds
1800 Swift Drive                                       Blistex Inc., a consumer                in the Fund Complex.
Oak Brook, IL 60523                                    health care products
                                                       manufacturer. Director of
                                                       the Heartland Alliance, a
                                                       nonprofit organization
                                                       serving human needs based
                                                       in Chicago. Director of
                                                       St. Vincent de Paul
                                                       Center, a Chicago based
                                                       day care facility serving
                                                       the children of low
                                                       income families. Board
                                                       member of the Illinois
                                                       Manufacturers'
                                                       Association.

J. Miles Branagan (72)        Trustee      Trustee     Private investor.              83       Trustee/Director/Managing
1632 Morning Mountain Road                 since 2003  Co-founder, and prior to                General Partner of funds
Raleigh, NC 27614                                      August 1996, Chairman,                  in the Fund Complex.
                                                       Chief Executive Officer
                                                       and President, MDT
                                                       Corporation (now known as
                                                       Getinge/Castle, Inc., a
                                                       subsidiary of Getinge
                                                       Industrier AB), a company
                                                       which develops,
                                                       manufactures, markets and
                                                       services medical and
                                                       scientific equipment.
</Table>



                                      C-42
<PAGE>




<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE           TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Jerry D. Choate (66)          Trustee      Trustee     Prior to January 1999,         83       Trustee/Director/Managing
33971 Selva Road                           since 2003  Chairman and Chief                      General Partner of funds
Suite 130                                              Executive Officer of the                in the Fund Complex.
Dana Point, CA 92629                                   Allstate Corporation                    Director of Amgen Inc., a
                                                       ("Allstate") and Allstate               biotechnological company,
                                                       Insurance Company. Prior                and Director of Valero
                                                       to January 1995,                        Energy Corporation, an
                                                       President and Chief                     independent refining
                                                       Executive Officer of                    company.
                                                       Allstate. Prior to August
                                                       1994, various management
                                                       positions at Allstate.
</Table>



                                      C-43
<PAGE>



<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE           TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Rod Dammeyer (64)             Trustee      Trustee     President of CAC, L.L.C.,      85       Trustee/Director/Managing
CAC, L.L.C.                                since 1991  a private company                       General Partner of funds
4350 LaJolla Village Drive                             offering capital                        in the Fund Complex.
Suite 980                                              investment and management               Director of Stericycle,
San Diego, CA 92122-6223                               advisory services. Prior                Inc., Ventana Medical
                                                       to February 2001, Vice                  Systems, Inc., and GATX
                                                       Chairman and Director of                Corporation, and Trustee
                                                       Anixter International,                  of The Scripps Research
                                                       Inc., a global                          Institute and the
                                                       distributor of wire,                    University of Chicago
                                                       cable and communications                Hospitals and Health
                                                       connectivity products.                  Systems. Prior to January
                                                       Prior to July 2000,                     2004, Director of
                                                       Managing Partner of                     TeleTech Holdings Inc.
                                                       Equity Group Corporate                  and Arris Group, Inc.
                                                       Investment (EGI), a                     Prior to May 2002,
                                                       company that makes                      Director of Peregrine
                                                       private investments in                  Systems Inc. Prior to
                                                       other companies.                        February 2001, Director
                                                                                               of IMC Global Inc. Prior
                                                                                               to July 2000, Director of
                                                                                               Allied Riser
                                                                                               Communications Corp.,
                                                                                               Matria Healthcare Inc.,
                                                                                               Transmedia Networks,
                                                                                               Inc., CNA Surety, Corp.
                                                                                               and Grupo Azcarero Mexico
                                                                                               (GAM).
</Table>



                                      C-44
<PAGE>



<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE           TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Linda Hutton Heagy (56)       Trustee      Trustee     Managing Partner of            83       Trustee/Director/Managing
Heidrick & Struggles                       since 2003  Heidrick & Struggles, an                General Partner of funds
233 South Wacker Drive                                 executive search firm.                  in the Fund Complex.
Suite 7000                                             Trustee on the University
Chicago, IL 60606                                      of Chicago Hospitals
                                                       Board, Vice Chair of the
                                                       Board of the YMCA of
                                                       Metropolitan Chicago and
                                                       a member of the Women's
                                                       Board of the University
                                                       of Chicago. Prior to
                                                       1997, Partner of Ray &
                                                       Berndtson, Inc., an
                                                       executive recruiting
                                                       firm. Prior to 1996,
                                                       Trustee of The
                                                       International House
                                                       Board, a fellowship and
                                                       housing organization for
                                                       international graduate
                                                       students. Prior to 1995,
                                                       Executive Vice President
                                                       of ABN AMRO, N.A., a bank
                                                       holding company. Prior to
                                                       1992, Executive Vice
                                                       President of La Salle
                                                       National Bank.

R. Craig Kennedy (52)         Trustee      Trustee     Director and President of      83       Trustee/Director/Managing
1744 R Street, NW                          since 2003  the German Marshall Fund                General Partner of funds
Washington, DC 20009                                   of the United States, an                in the Fund Complex.
                                                       independent U.S.
                                                       foundation created to
                                                       deepen understanding,
                                                       promote collaboration and
                                                       stimulate exchanges of
                                                       practical experience
                                                       between Americans and
                                                       Europeans. Formerly,
                                                       advisor to the Dennis
                                                       Trading Group Inc., a
                                                       managed futures and
                                                       option company that
                                                       invests money for
                                                       individuals and
                                                       institutions. Prior to
                                                       1992, President and Chief
                                                       Executive Officer,
                                                       Director and member of
                                                       the Investment Committee
                                                       of the Joyce Foundation,
                                                       a private foundation.

Howard J Kerr (69)            Trustee      Trustee     Prior to 1998, President       85       Trustee/Director/Managing
736 North Western Avenue                   since 1992  and Chief Executive                     General Partner of funds
P.O. Box 317                                           Officer of Pocklington                  in the Fund Complex.
Lake Forest, IL 60045                                  Corporation, Inc., an                   Director of the Lake
                                                       investment holding                      Forest Bank & Trust.
                                                       company. Director of the
                                                       Marrow Foundation.
</Table>



                                      C-45
<PAGE>



<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE           TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Jack E. Nelson (68)           Trustee      Trustee     President of Nelson            83       Trustee/Director/Managing
423 Country Club Drive                     since 2003  Investment Planning                     General Partner of funds
Winter Park, FL 32789                                  Services, Inc., a                       in the Fund Complex.
                                                       financial planning
                                                       company and registered
                                                       investment adviser in the
                                                       State of Florida.
                                                       President of Nelson Ivest
                                                       Brokerage Services Inc.,
                                                       a member of the NASD,
                                                       Securities Investors
                                                       Protection Corp. and the
                                                       Municipal Securities
                                                       Rulemaking Board.
                                                       President of Nelson Sales
                                                       and Services Corporation,
                                                       a marketing and services
                                                       company to support
                                                       affiliated companies.

Hugo F. Sonnenschein (64)     Trustee      Trustee     President Emeritus and         85       Trustee/Director/Managing
1126 E. 59th Street                        since 1994  Honorary Trustee of the                 General Partner of funds
Chicago, IL 60637                                      University of Chicago and               in the Fund Complex.
                                                       the Adam Smith                          Director of Winston
                                                       Distinguished Service                   Laboratories, Inc.
                                                       Professor in the
                                                       Department of Economics
                                                       at the University of
                                                       Chicago. Prior to July
                                                       2000, President of the
                                                       University of Chicago.
                                                       Trustee of the University
                                                       of Rochester and a member
                                                       of its investment
                                                       committee. Member of the
                                                       National Academy of
                                                       Sciences, the American
                                                       Philosophical Society and
                                                       a fellow of the American
                                                       Academy of Arts and
                                                       Sciences.

Suzanne H. Woolsey, Ph.D.     Trustee      Trustee     Chief Communications           83       Trustee/Director/Managing
(62)                                       since 2003  Officer of the National                 General Partner of funds
815 Cumberstone Road                                   Academy of                              in the Fund Complex.
Harwood, MD 20776                                      Sciences/National                       Director of Fluor Corp.,
                                                       Research Council, an                    an engineering,
                                                       independent, federally                  procurement and
                                                       chartered policy                        construction
                                                       institution, from 2001 to               organization, since
                                                       November 2003 and Chief                 January 2004 and Director
                                                       Operating Officer from                  of Neurogen Corporation,
                                                       1993 to 2001. Director of               a pharmaceutical company,
                                                       the Institute for Defense               since January 1998.
                                                       Analyses, a federally
                                                       funded research and
                                                       development center,
                                                       Director of the German
                                                       Marshall Fund of the
                                                       United States, Director
                                                       of the Rocky Mountain
                                                       Institute and Trustee of
                                                       Colorado College. Prior
                                                       to 1993, Executive
                                                       Director of the
                                                       Commission on Behavioral
                                                       and Social Sciences and
                                                       Education at the National
                                                       Academy of
                                                       Sciences/National
                                                       Research Council. From
                                                       1980 through 1989,
                                                       Partner of Coopers &
                                                       Lybrand.
</Table>



                                      C-46

<PAGE>



VAN KAMPEN MUNICIPAL TRUST

TRUSTEE AND OFFICER INFORMATION continued

INTERESTED TRUSTEES:*

<Table>
<Caption>
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INTERESTED TRUSTEE            TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Mitchell M. Merin* (51)       Trustee,     Trustee     President and Chief            83       Trustee/Director/Managing
1221 Avenue of the Americas   President    since       Executive Officer of                    General Partner of funds
New York, NY 10020            and Chief    2003;       funds in the Fund                       in the Fund Complex.
                              Executive    President   Complex. Chairman,
                              Officer      and Chief   President, Chief
                                           Executive   Executive Officer and
                                           Officer     Director of the Adviser
                                           since 2002  and Van Kampen Advisors
                                                       Inc. since December 2002.
                                                       Chairman, President and
                                                       Chief Executive Officer
                                                       of Van Kampen Investments
                                                       since December 2002.
                                                       Director of Van Kampen
                                                       Investments since
                                                       December 1999. Chairman
                                                       and Director of Van
                                                       Kampen Funds Inc. since
                                                       December 2002. President,
                                                       Director and Chief
                                                       Operating Officer of
                                                       Morgan Stanley Investment
                                                       Management since December
                                                       1998. President and
                                                       Director since April 1997
                                                       and Chief Executive
                                                       Officer since June 1998
                                                       of Morgan Stanley
                                                       Investment Advisors Inc.
                                                       and Morgan Stanley
                                                       Services Company Inc.
                                                       Chairman, Chief Executive
                                                       Officer and Director of
                                                       Morgan Stanley
                                                       Distributors Inc. since
                                                       June 1998. Chairman since
                                                       June 1998, and Director
                                                       since January 1998 of
                                                       Morgan Stanley Trust.
                                                       Director of various
                                                       Morgan Stanley
                                                       subsidiaries. President
                                                       of the Morgan Stanley
                                                       Funds since May 1999.
                                                       Previously Chief
                                                       Executive Officer of Van
                                                       Kampen Funds Inc. from
                                                       December 2002 to July
                                                       2003, Chief Strategic
                                                       Officer of Morgan Stanley
                                                       Investment Advisors Inc.
                                                       and Morgan Stanley
                                                       Services Company Inc. and
                                                       Executive Vice President
                                                       of Morgan Stanley
                                                       Distributors Inc. from
                                                       April 1997 to June 1998.
                                                       Chief Executive Officer
                                                       from September 2002 to
                                                       April 2003 and Vice
                                                       President from May 1997
                                                       to April 1999 of the
                                                       Morgan Stanley Funds.
</Table>



                                      C-47
<PAGE>



<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INTERESTED TRUSTEE            TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Richard F. Powers, III* (58)  Trustee      Trustee     Advisory Director of           85       Trustee/Director/Managing
1 Parkview Plaza                           since 1999  Morgan Stanley. Prior to                General Partner of funds
P.O. Box 5555                                          December 2002, Chairman,                in the Fund Complex.
Oakbrook Terrace, IL 60181                             Director, President,
                                                       Chief Executive Officer
                                                       and Managing Director of
                                                       Van Kampen Investments
                                                       and its investment
                                                       advisory, distribution
                                                       and other subsidiaries.
                                                       Prior to December 2002,
                                                       President and Chief
                                                       Executive Officer of
                                                       funds in the Fund
                                                       Complex. Prior to May
                                                       1998, Executive Vice
                                                       President and Director of
                                                       Marketing at Morgan
                                                       Stanley and Director of
                                                       Dean Witter, Discover &
                                                       Co. and Dean Witter
                                                       Realty. Prior to 1996,
                                                       Director of Dean Witter
                                                       Reynolds Inc.

Wayne W. Whalen* (65)         Trustee      Trustee     Partner in the law firm        85       Trustee/Director/Managing
333 West Wacker Drive                      since 1991  of Skadden, Arps, Slate,                General Partner of funds
Chicago, IL 60606                                      Meagher & Flom LLP, legal               in the Fund Complex.
                                                       counsel to funds in the
                                                       Fund Complex.
</Table>

*   Such Trustee is an "interested person" (within the meaning of Section
    2(a)(19) of the 1940 Act). Mr. Whalen is an interested person of certain
    funds in the Fund Complex by reason of his firm currently acting as legal
    counsel to such funds in the Fund Complex. Messrs. Merin and Powers are
    interested persons of funds in the Fund Complex and the Adviser by reason of
    their current or former positions with Morgan Stanley or its affiliates.



                                      C-48
<PAGE>



VAN KAMPEN MUNICIPAL TRUST

TRUSTEE AND OFFICER INFORMATION continued

OFFICERS:

<Table>
<Caption>
                                                     TERM OF
                                                    OFFICE AND
                                   POSITION(S)      LENGTH OF
NAME, AGE AND                       HELD WITH          TIME     PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER                    TRUST           SERVED    DURING PAST 5 YEARS
<S>                             <C>                 <C>         <C>
Stefanie V. Chang (38)          Vice President      Officer     Executive Director of Morgan Stanley Investment Management.
1221 Avenue of the Americas     and Secretary       since 2003  Vice President of funds in the Fund Complex.
New York, NY 10020

Amy R. Doberman (42)            Vice President      Officer     Managing Director and General Counsel, U.S. Investment
1221 Avenue of the Americas                         since 2004  Management; Managing Director of Morgan Stanley Investment
New York, NY 10020                                              Management, Inc., Morgan Stanley Investment Advisers Inc.
                                                                and the Adviser. Vice President of the Morgan Stanley
                                                                Institutional and Retail Funds since July 2004 and Vice
                                                                President of funds in the Fund Complex as of August 2004.
                                                                Previously, Managing Director and General Counsel of
                                                                Americas, UBS Global Asset Management from July 2000 to July
                                                                2004 and General Counsel of Aeitus Investment Management,
                                                                Inc. from January 1997 to July 2000.

James M. Dykas (38)             Chief Financial     Officer     Executive Director of Van Kampen Asset Management and Morgan
1 Parkview Plaza                Officer and         since 1999  Stanley Investment Management. Chief Financial Officer and
Oakbrook Terrace, IL 60181      Treasurer                       Treasurer of funds in the Fund Complex. Prior to August
                                                                2004, Assistant Treasurer of funds in the Fund Complex.

Joseph J. McAlinden (61)        Executive Vice      Officer     Managing Director and Chief Investment Officer of Morgan
1221 Avenue of the Americas     President and       since 2002  Stanley Investment Advisors Inc., and Morgan Stanley
New York, NY 10020              Chief Investment                Investment Management Inc. and Director of Morgan Stanley
                                Officer                         Trust for over 5 years. Executive Vice President and Chief
                                                                Investment Officer of funds in the Fund Complex. Managing
                                                                Director and Chief Investment Officer of Van Kampen
                                                                Investments, the Adviser and Van Kampen Advisors Inc. since
                                                                December 2002.

Ronald E. Robison (65)          Executive Vice      Officer     Principal Executive Officer of the Funds since May 2003.
1221 Avenue of the Americas     President and       since 2003  Chief Executive Officer and Chairman of Investor Services.
New York, NY 10020              Principal                       Executive Vice President and Principal Executive Officer of
                                Executive                       funds in the Fund Complex. Managing Director of Morgan
                                Officer                         Stanley. Chief Administrative Officer, Managing Director and
                                                                Director of Morgan Stanley Investment Advisors Inc., Morgan
                                                                Stanley Services Company Inc. and Managing Director and
                                                                Director of Morgan Stanley Distributors Inc. Chief Executive
                                                                Officer and Director of Morgan Stanley Trust. Executive Vice
                                                                President and Principal Executive Officer of the
                                                                Institutional and Retail Morgan Stanley Funds; Director of
                                                                Morgan Stanley SICAV; previously Chief Global Operations
                                                                Officer and Managing Director of Morgan Stanley Investment
                                                                Management Inc.
</Table>



                                      C-49
<PAGE>



<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                     TERM OF
                                                    OFFICE AND
                                   POSITION(S)      LENGTH OF
NAME, AGE AND                       HELD WITH          TIME     PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER                    TRUST           SERVED    DURING PAST 5 YEARS
<S>                             <C>                 <C>         <C>

John L. Sullivan (49)           Chief Compliance    Officer     Chief Compliance Officer of funds in the Fund Complex since
1 Parkview Plaza                Officer             since 1998  August 2004. Director and Managing Director of Van Kampen
Oakbrook Terrace, IL 60181                                      Investments, the Adviser, Van Kampen Advisors Inc. and
                                                                certain other subsidiaries of Van Kampen Investments. Prior
                                                                August 2004, Vice President, Chief Financial Officer and
                                                                Treasurer of funds in the Fund Complex and head of Fund
                                                                Accounting for Morgan Stanley Investment Management. Prior
                                                                to December 2002, Executive Director of Van Kampen
                                                                Investments, the Adviser and Van Kampen Advisors Inc.
</Table>



                                      C-50
<PAGE>



VAN KAMPEN

AN IMPORTANT NOTICE CONCERNING OUR U.S. PRIVACY POLICY

    We are required by federal law to provide you with a copy of our Privacy
Policy annually.

    The following Policy applies to current and former individual clients of Van
Kampen Investments Inc., Van Kampen Asset Management, Van Kampen Advisors Inc.,
Van Kampen Funds Inc., Van Kampen Investor Services Inc. and Van Kampen Exchange
Corp., as well as current and former individual investors in Van Kampen mutual
funds, unit investment trusts, and related companies.

    This Policy is not applicable to partnerships, corporations, trusts or other
non-individual clients or account holders, nor is this Policy applicable to
individuals who are either beneficiaries of a trust for which we serve as
trustee or participants in an employee benefit plan administered or advised by
us. This Policy is, however, applicable to individuals who select us to be a
custodian of securities or assets in individual retirement accounts, 401(k)
accounts, 529 Educational Savings Accounts, accounts subject to the Uniform
Gifts to Minors Act, or similar accounts.

    Please note that we may amend this Policy at any time, and will inform you
of any changes to this Policy as required by law.

WE RESPECT YOUR PRIVACY

We appreciate that you have provided us with your personal financial
information. We strive to maintain the privacy of such information while we help
you achieve your financial objectives. This Policy describes what non-public
personal information we collect about you, why we collect it, and when we may
share it with others.

    We hope this Policy will help you understand how we collect and share
non-public personal information that we gather about you. Throughout this
Policy, we refer to the non-public information that personally identifies you or
your accounts as "personal information."

1. WHAT PERSONAL INFORMATION DO WE COLLECT ABOUT YOU?

To serve you better and manage our business, it is important that we collect and
maintain accurate information about you. We may obtain this information from
applications and other forms you submit to us, from your dealings with us, from
consumer reporting agencies, from our Web sites and from third parties and other
sources.

    For example:

     --  We may collect information such as your name, address, e-mail address,
         telephone/fax numbers, assets, income and investment objectives through
         applications and other forms you submit to us.

     --  We may obtain information about account balances, your use of
         account(s) and the types of products and services you prefer to receive
         from us through your dealings and transactions with us and other
         sources.

     --  We may obtain information about your creditworthiness and credit
         history from consumer reporting agencies.

     --  We may collect background information from and through third-party
         vendors to verify representations you have made and to comply with
         various regulatory requirements.

     --  If you interact with us through our public and private Web sites, we
         may collect information that you provide directly through online
         communications (such as an e-mail address). We may also collect
         information about your Internet service provider, your domain name,
         your computer's operating system and Web browser,

                                                             (continued on back)


                                      C-51
<PAGE>

VAN KAMPEN


AN IMPORTANT NOTICE CONCERNING OUR U.S. PRIVACY POLICY continued

         your use of our Web sites and your product and service preferences,
         through the use of "cookies." "Cookies" recognize your computer each
         time you return to one of our sites, and help to improve our sites'
         content and personalize your experience on our sites by, for example,
         suggesting offerings that may interest you. Please consult the Terms of
         Use of these sites for more details on our use of cookies.

2. WHEN DO WE DISCLOSE PERSONAL INFORMATION WE COLLECT ABOUT YOU?

To provide you with the products and services you request, to serve you better
and to manage our business, we may disclose personal information we collect
about you to our affiliated companies and to non-affiliated third parties as
required or permitted by law.

A. INFORMATION WE DISCLOSE TO OUR AFFILIATED COMPANIES. We do not disclose
personal information that we collect about you to our affiliated companies
except to enable them to provide services on our behalf or as otherwise required
or permitted by law.

B. INFORMATION WE DISCLOSE TO THIRD PARTIES. We do not disclose personal
information that we collect about you to non-affiliated third parties except to
enable them to provide services on our behalf, to perform joint marketing
agreements with other financial institutions, or as otherwise required or
permitted by law. For example, some instances where we may disclose information
about you to non-affiliated third parties include: for servicing and processing
transactions, to offer our own products and services, to protect against fraud,
for institutional risk control, to respond to judicial process or to perform
services on our behalf. When we share personal information with these companies,
they are required to limit their use of personal information to the particular
purpose for which it was shared and they are not allowed to share personal
information with others except to fulfill that limited purpose.

3. HOW DO WE PROTECT THE SECURITY AND CONFIDENTIALITY OF PERSONAL INFORMATION WE
COLLECT ABOUT YOU?

We maintain physical, electronic and procedural security measures to help
safeguard the personal information we collect about you. We have internal
policies governing the proper handling of client information. Third parties that
provide support or marketing services on our behalf may also receive personal
information, and we require them to adhere to confidentiality standards with
respect to such information.

                                                Van Kampen Funds Inc.
                                                1 Parkview Plaza, P.O. Box 5555
                                                Oakbrook Terrace, IL 60181-5555
                                                www.vankampen.com

                                     (VAN KAMPEN INVESTMENTS LOGO)

                                                Copyright (C)2004 Van Kampen
                                                Funds Inc. All rights reserved.
                                                Member NASD/SIPC.
                                                VKQ ANR 12/04 RN04-02826P-Y10/04



                                      C-52
<PAGE>






                                   APPENDIX D

                TARGET FUND ANNUAL REPORT DATED OCTOBER 31, 2004





                                       D-1
<PAGE>

Item 1. Report to Shareholders.

The Trust's annual report transmitted to shareholders pursuant to Rule 30e-1
under the Investment Company Act of 1940 is as follows:

       Welcome, Shareholder

       In this report, you'll learn about how your investment in Van Kampen
       Investment Grade Municipal Trust performed during the annual period. The
       portfolio management team will provide an overview of the market
       conditions and discuss some of the factors that affected investment
       performance during the reporting period. In addition, this report
       includes the trust's financial statements and a list of trust investments
       as of October 31, 2004.

       MARKET FORECASTS PROVIDED IN THIS REPORT MAY NOT NECESSARILY COME TO
       PASS. THERE IS NO ASSURANCE THAT THE TRUST WILL ACHIEVE ITS INVESTMENT
       OBJECTIVE. TRUSTS ARE SUBJECT TO MARKET RISK, WHICH IS THE POSSIBILITY
       THAT THE MARKET VALUES OF SECURITIES OWNED BY THE TRUST WILL DECLINE AND
       THAT THE VALUE OF TRUST SHARES MAY THEREFORE BE LESS THAN WHAT YOU PAID
       FOR THEM. ACCORDINGLY, YOU CAN LOSE MONEY INVESTING IN THIS TRUST.

       INCOME MAY SUBJECT CERTAIN INDIVIDUALS TO THE FEDERAL ALTERNATIVE MINIMUM
       TAX (AMT).

<Table>
<Caption>
         <S>                    <C>                                       <C>
         ---------------------------------------------------------------------------------------
            NOT FDIC INSURED             OFFER NO BANK GUARANTEE              MAY LOSE VALUE
         ---------------------------------------------------------------------------------------
                   NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY               NOT A DEPOSIT
         ---------------------------------------------------------------------------------------
</Table>



                                      D-2



<PAGE>


Performance Summary as of 10/31/04

<Table>
<Caption>
INVESTMENT GRADE MUNICIPAL TRUST
SYMBOL: VIG
- ---------------------------------------------------------
AVERAGE ANNUAL                   BASED ON      BASED ON
TOTAL RETURNS                      NAV       MARKET PRICE
<S>                              <C>         <C>

Since Inception (11/30/89)        6.34%         4.82%

10-year                           6.35          4.34

5-year                            8.15          6.66

1-year                            7.74          6.85
- ---------------------------------------------------------
</Table>

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES
SHOWN. FOR THE MOST RECENT MONTH-END PERFORMANCE FIGURES, PLEASE VISIT
VANKAMPEN.COM OR SPEAK WITH YOUR FINANCIAL ADVISOR. INVESTMENT RETURNS, NET
ASSET VALUE (NAV) AND COMMON SHARE MARKET PRICE WILL FLUCTUATE AND TRUST SHARES,
WHEN SOLD, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.

NAV per share is determined by dividing the value of the trust's portfolio
securities, cash and other assets, less all liabilities, by the total number of
common shares outstanding. The common share market price is the price the market
is willing to pay for shares of the trust at a given time. Common share market
price is influenced by a range of factors, including supply and demand and
market conditions. Total return assumes an investment at the beginning of the
period, reinvestment of all distributions for the period in accordance with the
trust's dividend reinvestment plan, and sale of all shares at the end of the
period.

The Lehman Brothers Municipal Bond Index is a broad-based statistical composite
of municipal bonds. The index does not include any expenses, fees or sales
charges, which would lower performance. The index is unmanaged and should not be
considered an investment. It is not possible to invest directly in an index.



                                      D-3



<PAGE>


Trust Report

FOR THE 12-MONTH PERIOD ENDED OCTOBER 31, 2004

Van Kampen Investment Grade Municipal Trust is managed by the Adviser's
Municipal Fixed Income team.(1) Current members include Thomas Byron, Vice
President; Robert Wimmel, Vice President; and John Reynoldson, Executive
Director.

MARKET CONDITIONS

The interest-rate environment of the 12 months ended October 31, 2004 was marked
by two periods of steadily declining yields, with a significant sell-off in the
middle. Yields fell steadily through the first half of the period, approaching
the historical lows of 2003. This trend persisted until March, at which point
yields reversed direction and began an upward march as prices fell. These losses
were steepest in April, as a surprisingly strong employment report and signals
from members of the Federal Open Market Committee (the Fed) caused investors to
expect a near-term rate increase. Rates went on to decline from May through the
end of the period as the market digested the Fed's newly hawkish rate stance.
Investors were further comforted when, after the Fed raised rates at its June
30, 2004 meeting, its members indicated that the path of future rate increases
would be measured.

Unusually, longer-maturity securities largely outperformed in this period of Fed
tightening. Historically, the typical pattern in periods of tightening policy
has seen yields rise across all maturities. During the review period, however,
yields of shorter maturity bonds rose while those of bonds with longer
maturities declined slightly.

Lower-quality municipal bonds also performed strongly in this environment, as
the difference in yields (known as the "yield spread") between AAA and BBB rated
bonds decreased by roughly 20 basis points for 20-year bonds. As a result,
sectors with heavy exposure to lower-rated debt, such as hospitals and
industrial-revenue bonds, posted higher total returns than sectors dominated by
higher-rated debt.

Issuance for the first ten months of 2004 (the final ten months of the review
period) was roughly six percent lower than in the same period in 2003. That
said, 2003 was a record year, and at the current pace of issuance, 2004 could
well be one of the largest years in recent memory. The strong supply met with
faltering demand from mutual funds, as fund investors withdrew over $15 billion
in net cash during the period. This faltering demand was largely offset by
increased participation in the market by insurance companies and individual
investors.

(1)Team members may change without notice at any time.




                                      D-4


<PAGE>


PERFORMANCE ANALYSIS

The trust's return can be calculated based upon either the market price or the
net asset value (NAV) of its shares. NAV per share is determined by dividing the
value of the trust's portfolio securities, cash and other assets, less all
liabilities, by the total number of common shares outstanding, while market
price reflects the supply and demand for the shares. As a result, the two
returns can differ significantly. On both an NAV basis and a market price basis,
the trust outperformed its benchmark index, the Lehman Brothers Municipal Bond
Index. (See table below.)

The trust uses leverage to enhance its dividend to common shareholders. The
trust borrows money at short-term rates through the issuance of preferred
shares. The proceeds are reinvested in longer-term securities, taking advantage
of the difference between short- and longer-term rates. The Fed's policy of
raising interest rates in the final months of the period made the trust's
borrowing activity more expensive. These expenses, however, were more than
offset by the strong performance of the bonds we invested in, leading to the
trust's outperformance versus its benchmark, which is unleveraged.

The historically low level of interest rates led us to maintain the trust's
overall interest-rate sensitivity at a level below that of its benchmark. This
strategy helped shield the trust from negative returns during those times during
the period when yields rose. That said, yields overall declined over the period,
and the strategy exerted a drag on performance.

The fund experienced some significant call activity during the period, as
issuers sought to lower their interest costs by refinancing their bonds at lower
market rates. We reinvested the proceeds into bonds with more favorable
prospects for total return. Many of these securities were in the 15- to 20-year
segment of the market, which our analysis indicated offered the most appealing
combination of value and total-return potential.

In keeping with our long-term approach, we bought and sold bonds at the long end
of the market as they came into and out of fair value. This strategy entails
purchasing bonds with attractive total-return prospects and selling them once
they have reached our performance targets. Many of our purchases in this

TOTAL RETURN FOR THE 12-MONTH PERIOD ENDED OCTOBER 31, 2004

<Table>
<Caption>
- ---------------------------------------------------------------
      BASED ON     BASED ON     LEHMAN BROTHERS MUNICIPAL
        NAV      MARKET PRICE          BOND INDEX
<S>   <C>        <C>            <C>                       <C>

       7.74%        6.85%                 6.03%
- ---------------------------------------------------------------
</Table>

PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES
SHOWN. INVESTMENT RETURN, NET ASSET VALUE AND COMMON SHARE MARKET PRICE WILL
FLUCTUATE AND TRUST SHARES, WHEN SOLD, MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST. SEE PERFORMANCE SUMMARY FOR ADDITIONAL PERFORMANCE INFORMATION
AND INDEX DEFINITION.




                                      D-5


<PAGE>


strategy involved health-care bonds, which offered attractive valuations for
much of the period.

We remained focused on controlling the trust's risk profile range through
attention to credit quality and diversification. By the end of the 12-month
period, more than 76 percent of the trust's total investments were invested in
bonds rated AAA and AA; these represent the two highest tiers of credit ratings.
The portfolio was also well diversified across the major sectors of the
municipal bond market. Its three largest sector exposures were general purpose,
public building, and public education.

While it is impossible to predict the exact turning point when interest rates
will move decisively higher, we believe the trust remains well positioned for
the near future. We will continue to search the municipal bond markets for
interesting opportunities.

There is no guarantee that any securities mentioned will continue to perform
well or be held by the trust in the future.



                                      D-6


<PAGE>


<Table>
<Caption>
RATINGS ALLOCATION AS OF 10/31/04
<S>                                                               <C>
AAA/Aaa                                                            68.1%
AA/Aa                                                               8.4
A/A                                                                11.5
BBB/Baa                                                             0.7
BB/Ba                                                               0.5
B/B                                                                 6.2
Non-Rated                                                           4.6
<Caption>
TOP 5 SECTORS AS OF 10/31/04
<S>                                                               <C>
General Purpose                                                    15.1%
Public Building                                                    13.9
Public Education                                                   11.9
Health Care                                                        10.6
Wholesale Electric                                                  7.1
<Caption>
SUMMARY OF INVESTMENTS BY STATE CLASSIFICATION AS OF 10/31/04
<S>                                                               <C>
California                                                         10.8%
Illinois                                                            8.3
Texas                                                               8.1
New Jersey                                                          6.7
Kansas                                                              5.8
Florida                                                             5.7
Washington                                                          5.5
Missouri                                                            5.5
Colorado                                                            4.6
New York                                                            3.8
Ohio                                                                3.2
South Carolina                                                      3.2
Massachusetts                                                       3.1
Alaska                                                              3.1
Pennsylvania                                                        2.6
Connecticut                                                         2.0
Nevada                                                              1.9
Arizona                                                             1.6
Georgia                                                             1.5
Indiana                                                             1.5
Oregon                                                              1.5
Alabama                                                             1.5
North Carolina                                                      1.4
Guam                                                                1.4
Puerto Rico                                                         1.4
Tennessee                                                           1.3
New Hampshire                                                       1.2
Maryland                                                            0.7
Arkansas                                                            0.6
Wisconsin                                                           0.5
                                                                  -----
Total Investments                                                 100.0%
</Table>

Subject to change daily. Provided for informational purposes only and should not
be deemed as a recommendation to buy or sell the securities mentioned or
securities in the sectors shown above. Ratings and summary of investments by
state classification are as a percentage of total investments. Sectors are as a
percentage of long-term investments. Securities are classified by sectors that
represent broad groupings of related industries. Van Kampen is a wholly owned
subsidiary of a global securities firm which is engaged in a wide range of
financial services including, for example, securities trading and brokerage
activities, investment banking, research and analysis, financing and financial
advisory services. Rating allocations based upon ratings as issued by Standard
and Poor's and Moody's, respectively.




                                      D-7


<PAGE>


FOR MORE INFORMATION ABOUT PORTFOLIO HOLDINGS

       Each Van Kampen trust provides a complete schedule of portfolio holdings
       in its semiannual and annual reports within 60 days of the end of the
       trust's second and fourth fiscal quarters by filing the schedule
       electronically with the Securities and Exchange Commission (SEC). The
       semiannual reports are filed on Form N-CSRS and the annual reports are
       filed on Form N-CSR. Van Kampen also delivers the semiannual and annual
       reports to trust shareholders, and makes these reports available on its
       public web site, www.vankampen.com. In addition to the semiannual and
       annual reports that Van Kampen delivers to shareholders and makes
       available through the Van Kampen public web site, each trust files a
       complete schedule of portfolio holdings with the SEC for the trust's
       first and third fiscal quarters on Form N-Q. Van Kampen does not deliver
       the reports for the first and third fiscal quarters to shareholders, nor
       are the reports posted to the Van Kampen public web site. You may,
       however, obtain the Form N-Q filings (as well as the Form N-CSR and
       N-CSRS filings) by accessing the SEC's web site, http://www.sec.gov. You
       may also review and copy them at the SEC's Public Reference Room in
       Washington, DC. Information on the operation of the SEC's Public
       Reference Room may be obtained by calling the SEC at 1-202-942-8090. You
       can also request copies of these materials, upon payment of a duplicating
       fee, by electronic request at the SEC's e-mail address
       (publicinfo@sec.gov) or by writing the Public Reference section of the
       SEC, Washington, DC 20549-0102.

       In addition to filing a complete schedule of portfolio holdings with the
       SEC each fiscal quarter, each Van Kampen trust makes portfolio holdings
       information available by periodically providing the information on its
       public web site, www.vankampen.com. Each Van Kampen trust provides a
       complete schedule of portfolio holdings on the public web site on a
       calendar-quarter basis approximately 30 days after the close of the
       calendar quarter. Van Kampen closed-end funds do not presently provide
       partial lists of their portfolio holdings on a monthly basis, but may do
       so in the future.

       You may obtain copies of a trust's fiscal quarter filings, or its monthly
       or calendar-quarter web site postings, by contacting Van Kampen Client
       Relations at 1-800-847-2424.

PROXY VOTING POLICIES AND PROCEDURES AND PROXY VOTING RECORD

       The trust's policies and procedures with respect to the voting of proxies
       relating to the trust's portfolio securities and information on how the
       trust voted proxies relating to portfolio securities during the most
       recent twelve-month period ended June 30 is available without charge,
       upon request, by calling 1-800-847-2424 or by visiting our web site at
       www.vankampen.com. This information is also available on the Securities
       and Exchange Commission's web site at http://www.sec.gov.



                                      D-8


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                       COUPON    MATURITY      VALUE
- ---------------------------------------------------------------------------------------------
<C>       <S>                                               <C>       <C>        <C>
          MUNICIPAL BONDS  148.6%
          ALABAMA  2.2%
$1,000    Gadsden, AL Wts Ser B (AMBAC Insd)...............  5.250%   08/01/21   $  1,096,630
                                                                                 ------------

          ALASKA  4.5%
 1,000    Alaska St Intl Arpt Rev Ser B (AMBAC Insd).......  5.750    10/01/17      1,152,230
 1,000    Matanuska-Susitna Boro, AK Ctf Part Pub Safety
          Bldg Lease (FSA Insd)............................  5.750    03/01/16      1,127,590
                                                                                 ------------
                                                                                    2,279,820
                                                                                 ------------
          ARIZONA  2.4%
 1,000    Phoenix, AZ Civic Impt Corp Wastewtr Sys Rev Jr
          Lien (Prerefunded @ 07/01/10) (FGIC Insd)........  6.250    07/01/17      1,185,090
                                                                                 ------------

          ARKANSAS  0.9%
   426    Dogwood Addition PRD Muni Ppty Owners Multi-Purp
          Imp Dist No 8 Maumelle AK Impt Ser 2001 Rfdg
          (Acquired 03/14/01, Cost $425,960) (a) (f).......  7.500    03/01/06        426,092
                                                                                 ------------
          CALIFORNIA  16.0%
   750    California St Dept Wtr Res Pwr Ser A.............  6.000    05/01/15        878,010
 1,000    California St Dept Wtr Res Pwr Ser A (AMBAC
          Insd)............................................  5.375    05/01/18      1,109,200
   995    California St Pub Wks Brd UCLA Replacement Hosp
          Ser A (FSA Insd).................................  5.375    10/01/20      1,092,391
 4,290    Contra Costa, CA Home Mtg Fin Auth Home Mtg Rev
          (Escrowed to Maturity) (MBIA Insd) (b)...........   *       09/01/17      2,347,273
   225    Foothill/Eastern Corridor Agy CA Toll Rd Rev Conv
          Cap Apprec Sr Lien Ser A (Prerefunded @ 01/01/10)
          (c).............................................. 0/7.150   01/01/13        271,849
   500    Fresno, CA Uni Sch Dist Ser A Rfdg (MBIA Insd)...  6.100    08/01/12        596,285
 1,000    Los Angeles, CA Uni Sch Dist Ser A (MBIA Insd)...  5.375    07/01/18      1,118,910
 1,000    San Joaquin Hills, CA Transn Corridor Agy Toll Rd
          Rev Cap Apprec Ser A Rfdg (MBIA Insd)............   *       01/15/27        313,240
 1,000    San Joaquin Hills, CA Transn Corridor Agy Toll Rd
          Rev Cap Apprec Ser A Rfdg (MBIA Insd)............   *       01/15/28        295,280
                                                                                 ------------
                                                                                    8,022,438
                                                                                 ------------
          COLORADO  6.9%
 1,000    Colorado Hlth Fac Auth Rev Evangelical Lutheran
          Ser A............................................  5.250    06/01/34      1,019,960
   180    Jefferson Cnty, CO Residential Mtg Rev (Escrowed
          to Maturity) (g)................................. 11.500    09/01/05        193,948
   205    Jefferson Cnty, CO Residential Mtg Rev (Escrowed
          to Maturity) (g)................................. 11.500    09/01/06        238,811
   235    Jefferson Cnty, CO Residential Mtg Rev (Escrowed
          to Maturity) (g)................................. 11.500    09/01/07        292,869
   265    Jefferson Cnty, CO Residential Mtg Rev (Escrowed
          to Maturity) (g)................................. 11.500    09/01/08        349,670
</Table>

See Notes to Financial Statements



                                      D-9


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                       COUPON    MATURITY      VALUE
- ---------------------------------------------------------------------------------------------
<C>       <S>                                               <C>       <C>        <C>
          COLORADO (CONTINUED)
$  300    Jefferson Cnty, CO Residential Mtg Rev (Escrowed
          to Maturity) (g)................................. 11.500%   09/01/09   $    413,985
   340    Jefferson Cnty, CO Residential Mtg Rev (Escrowed
          to Maturity) (g)................................. 11.500    09/01/10        487,988
   220    Jefferson Cnty, CO Residential Mtg Rev (Escrowed
          to Maturity)..................................... 11.500    09/01/11        327,510
   100    Jefferson Cnty, CO Residential Mtg Rev (Escrowed
          to Maturity) (g).................................  9.000    09/01/12        137,182
                                                                                 ------------
                                                                                    3,461,923
                                                                                 ------------
          CONNECTICUT  2.9%
 1,360    Bridgeport, CT Ser A (MBIA Insd).................  5.250    08/15/24      1,468,514
                                                                                 ------------

          FLORIDA  8.5%
 1,000    Escambia Cnty, FL Hlth Fac Auth Rev (AMBAC
          Insd)............................................  5.950    07/01/20      1,027,260
 1,000    Highlands Cnty, FL Hlth Fac Auth Rev Hosp
          Adventist Hlth Sys Ser D.........................  5.375    11/15/35      1,035,450
 1,000    Jacksonville, FL Rev Better Jacksonville (MBIA
          Insd)............................................  5.250    10/01/21      1,094,720
 1,000    West Palm Beach, FL..............................  5.250    03/01/14      1,095,120
                                                                                 ------------
                                                                                    4,252,550
                                                                                 ------------
          GEORGIA  2.2%
 1,000    Municipal Elec Auth GA Combustion Turbine Proj
          Ser A (MBIA Insd)................................  5.250    11/01/16      1,122,820
                                                                                 ------------

          ILLINOIS  12.3%
   150    Bedford Park, IL Tax Increment 71st & Cicero Proj
          Rfdg.............................................  7.000    01/01/06        152,838
 1,000    Chicago, IL O'Hare Intl Arpt Rev Gen Arpt Third
          Lien C 2 Rfdg (AMT) (FSA Insd)...................  5.250    01/01/30      1,034,130
   400    Chicago, IL O'Hare Intl Arpt Spl Fac Rev United
          Airl Inc Proj Ser B Rfdg (Variable Rate Coupon)
          (AMT) (d) (e)....................................  6.100    11/01/35         60,000
 1,250    Chicago, IL Proj Ser C Rfdg (FGIC Insd)..........  5.500    01/01/40      1,354,225
    55    Chicago, IL Single Family Mtg Rev Ser B (AMT)
          (GNMA Collateralized)............................  7.625    09/01/27         55,261
   510    Cook Cnty, IL Sch Dist No 107 (g)................  7.150    12/01/08        593,482
   575    Cook Cnty, IL Sch Dist No 107 (g)................  7.200    12/01/09        685,653
   625    Cook Cnty, IL Sch Dist No 107....................  7.000    12/01/10        753,162
   500    Hodgkins, IL Tax Increment Ser A Rfdg............  7.625    12/01/13        536,010
   250    Lake Cnty, IL Cmnty Unit (Escrowed to Maturity)
          (Radian Insd) (b)................................  7.600    02/01/14        328,982
 1,000    McHenry & Kane Cntys, IL Cmnty (FGIC Insd).......   *       01/01/16        616,270
                                                                                 ------------
                                                                                    6,170,013
                                                                                 ------------
</Table>


                                             See Notes to Financial Statements




                                  D-10

<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                       COUPON    MATURITY      VALUE
- ---------------------------------------------------------------------------------------------
<C>       <S>                                               <C>       <C>        <C>
          INDIANA  2.2%
$1,000    MSD Warren Twp IN Vision 2005 First Mtg (FGIC
          Insd)............................................  5.500%   07/15/20   $  1,112,490
                                                                                 ------------
          KANSAS  8.6%
 1,825    Cowley Cnty, KS Uni Sch Dist Impt Rfdg (MBIA
          Insd) (g)........................................  5.250    10/01/22      1,983,994
   400    Overland Pk, KS Dev Corp Rev First Tier Overland
          Park Ser A.......................................  7.375    01/01/32        409,420
 1,000    Wyandotte Cnty, KS Sch Dist 500 Rfdg (FSA
          Insd)............................................  5.000    09/01/19      1,095,340
   740    Wyandotte Cnty/Kansas City, KS Uni Govt Indl Rev
          Brd Pub Util Bldg Complex Proj (MBIA Insd) (g)...  5.000    05/01/09        812,372
                                                                                 ------------
                                                                                    4,301,126
                                                                                 ------------
          MARYLAND  1.0%
   500    Maryland St Econ Dev Corp Student Hsg Rev Univ MD
          College Pk Proj..................................  5.625    06/01/35        516,610
                                                                                 ------------

          MASSACHUSETTS  4.6%
   600    Massachusetts St Dev Fin Agy Rev Proj Ser A (MBIA
          Insd)............................................  5.125    02/01/34        618,720
 1,500    Massachusetts St Fed Hwy Grant Antic Nt Ser A....  5.750    06/15/14      1,699,830
                                                                                 ------------
                                                                                    2,318,550
                                                                                 ------------
          MISSOURI  8.2%
 1,000    Cape Girardeau Cnty, MO Indl Dev Auth Hlthcare
          Fac Rev Southeast MO Hosp Assoc..................  5.625    06/01/27      1,019,470
   400    Fenton, MO Tax Increment Rev & Impt Gravois
          Bluffs Proj Rfdg.................................  7.000    10/01/21        433,400
 1,000    Saint Charles, MO Ctf Part Ser B.................  5.500    05/01/18      1,076,240
 1,460    Saint Louis, MO Brd Ed Direct Dep Pgm Ser A Rfdg
          (FSA Insd).......................................  5.000    04/01/21      1,558,638
                                                                                 ------------
                                                                                    4,087,748
                                                                                 ------------
          NEVADA  2.8%
 1,000    Clark Cnty, NV Indl Dev Rev Southwest Gas Corp
          Proj Ser A (AMT) (AMBAC Insd)....................  5.250    07/01/34      1,032,000
   390    Nevada Hsg Div Single Family Mtg Mezz Ser D2
          (AMT)............................................  6.300    04/01/21        391,330
                                                                                 ------------
                                                                                    1,423,330
                                                                                 ------------
          NEW HAMPSHIRE  1.8%
   525    New Hampshire Hlth & Ed Fac Auth Rev Derryfield
          Sch..............................................  6.750    07/01/20        518,695
   350    New Hampshire Hlth & Ed Fac Hlthcare Sys Covenant
          Hlth.............................................  5.500    07/01/34        358,810
                                                                                 ------------
                                                                                      877,505
                                                                                 ------------
</Table>

See Notes to Financial Statements




                                      D-11


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                       COUPON    MATURITY      VALUE
- ---------------------------------------------------------------------------------------------
<C>       <S>                                               <C>       <C>        <C>
          NEW JERSEY  10.0%
$1,000    New Jersey Econ Dev Auth Econ Dev Rev Kapkowski
          Rd Landfill Proj Rfdg............................  5.750%   04/01/31   $    989,230
   500    New Jersey Econ Dev Auth Rev Cigarette Tax.......  5.750    06/15/34        513,800
 1,500    New Jersey Econ Dev Auth Wtr Fac Rev NJ American
          Wtr Co Inc Ser B (AMT) (FGIC Insd)...............  5.375    05/01/32      1,558,110
 1,000    New Jersey St Ed Fac Auth Higher Ed Cap Impt Ser
          A (AMBAC Insd)...................................  5.250    09/01/21      1,094,190
   765    New Jersey St Trans Corp Cap Grant Antic Nt Ser B
          (AMBAC Insd).....................................  5.500    02/01/08        840,781
                                                                                 ------------
                                                                                    4,996,111
                                                                                 ------------
          NEW YORK  5.6%
 1,000    New York City Ser H..............................  5.750    03/15/13      1,132,340
 1,000    New York St Urban Dev Corp Rev Personal Income
          Tax Ser C 1 (FGIC Insd)..........................  5.500    03/15/19      1,133,770
   500    Yonkers, NY Indl Dev Agy Civic Fac Rev Cmnty Dev
          Ppty Yonkers Inc Ser A...........................  6.625    02/01/26        539,380
                                                                                 ------------
                                                                                    2,805,490
                                                                                 ------------
          NORTH CAROLINA  2.2%
 1,000    North Carolina Muni Pwr Agy Ser A (MBIA Insd)....  5.250    01/01/20      1,086,710
                                                                                 ------------

          OHIO  4.8%
 1,000    Franklin Cnty, OH Convention Fac Auth Tax & Lease
          Rev Antic Bds Rfdg (AMBAC Insd)..................  5.250    12/01/19      1,106,070
 1,250    Ohio St Bldg Auth St Fac Admin Bldg Fd Proj Ser A
          (FSA Insd).......................................  5.000    04/01/22      1,317,650
                                                                                 ------------
                                                                                    2,423,720
                                                                                 ------------
          OREGON  2.2%
 1,000    Oregon St Dept Admin Ser C Rfdg (MBIA Insd)......  5.250    11/01/18      1,109,480
                                                                                 ------------

          PENNSYLVANIA  3.8%
 1,000    Beaver Cnty, PA Indl Dev Auth Pollutn Ctl Rev
          Coll Toledo Edison Co Proj Rfdg..................  7.625    05/01/20      1,042,580
   315    Crawford Cnty, PA Hosp Auth Sr Living Fac Rev
          Wesbury Utd Methodist Cmnty (g)..................  5.875    08/15/10        332,511
   500    Harrisburg, PA Res Gtd Sub Ser D 2 (FSA Insd)....  5.000    12/01/33        548,555
                                                                                 ------------
                                                                                    1,923,646
                                                                                 ------------
          SOUTH CAROLINA  4.8%
 1,235    Rock Hill, SC Util Sys Rev Ser C Rfdg (FSA Insd)
          (g)..............................................  5.250    01/01/15      1,362,736
 1,000    South Carolina Jobs Econ Elec & Gas Co Proj Ser A
          (AMBAC Insd).....................................  5.200    11/01/27      1,052,450
                                                                                 ------------
                                                                                    2,415,186
                                                                                 ------------
</Table>

                                            See Notes to Financial Statements




                                      D-12

<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

<Table>
<Caption>
PAR
AMOUNT
(000)     DESCRIPTION                                       COUPON    MATURITY      VALUE
- ---------------------------------------------------------------------------------------------
<C>       <S>                                               <C>       <C>        <C>
          TENNESSEE  2.0%
$  400    Elizabethton, TN Hlth & Ed Fac Brd Rev Hosp First
          Mtg Ser B Impt & Rfdg............................  8.000%   07/01/33   $    475,768
   400    Elizabethton, TN Hlth & Ed Fac Brd Rev Hosp Ser B
          Impt & Rfdg (MBIA Insd)..........................  7.750    07/01/29        518,888
                                                                                 ------------
                                                                                      994,656
                                                                                 ------------
          TEXAS  12.0%
 1,000    Dallas-Fort Worth, TX Intl Arpt Rev Impt Jt Ser A
          Rfdg (AMT) (FGIC Insd)...........................  5.500    11/01/31      1,046,370
 1,500    Fort Worth, TX Wtr & Swr Rev Impt Rfdg...........  5.750    02/15/16      1,704,585
 1,000    Houston, TX Arpt Sys Rev Sub Lien Ser A (AMT)
          (FSA Insd).......................................  5.625    07/01/30      1,062,540
   400    Metropolitan Hlth Fac Dev Corp TX Wilson N Jones
          Mem Hosp Proj....................................  7.250    01/01/31        386,684
 1,000    North Cent TX Hlth Fac Dev Hosp Baylor Hlthcare
          Sys Proj Ser A...................................  5.125    05/15/29      1,016,360
   196    Pecos Cnty, TX Ctf Part (Acquired 06/23/97, Cost
          $196,000) (a)....................................  6.000    01/12/08        197,128
   605    Texas St Pub Ppty Fin Corp Rev Mental Hlth &
          Retardation Rfdg (FSA Insd)......................  5.500    09/01/13        617,923
                                                                                 ------------
                                                                                    6,031,590
                                                                                 ------------
          WASHINGTON  8.2%
 1,000    Energy Northwest WA Elec Rev Proj No 3 Ser A Rfdg
          (FSA Insd).......................................  5.500    07/01/17      1,124,070
 1,660    Pierce Cnty, WA (AMBAC Insd) (g).................  5.750    08/01/16      1,888,765
 1,000    Port Seattle, WA Rev Ser B (AMT) (MBIA Insd).....  5.625    02/01/24      1,085,740
                                                                                 ------------
                                                                                    4,098,575
                                                                                 ------------
          WISCONSIN  0.8%
   400    Wisconsin St Hlth & Ed Fac Beaver Dam Cmnty Hosp
          Inc Ser A........................................  6.000    08/15/19        396,900
                                                                                 ------------

          GUAM  2.1%
 1,000    Guam Pwr Auth Rev Ser A (AMBAC Insd).............  5.250    10/01/34      1,057,160
                                                                                 ------------

          PUERTO RICO  2.1%
 1,000    Puerto Rico Pub Bldg Auth Rev Gtd Govt Fac Ser I
          (Comwlth Gtd)....................................  5.250    07/01/33      1,047,830
                                                                                 ------------
TOTAL INVESTMENTS  148.6%
  (Cost $69,005,907)..........................................................     74,510,303
OTHER ASSETS IN EXCESS OF LIABILITIES  1.3%...................................        643,710
PREFERRED SHARES (INCLUDING ACCRUED DISTRIBUTIONS)  (49.9%)...................    (25,005,651)
                                                                                 ------------

NET ASSETS APPLICABLE TO COMMON SHARES  100.0%................................   $ 50,148,362
                                                                                 ============
</Table>

See Notes to Financial Statements




                                      D-13


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued

    Percentages are calculated as a percentage of net assets applicable to
    common shares.

*   Zero coupon bond

(a) These securities are restricted and may be resold only in transactions
    exempt from registration which are normally those transactions with
    qualified institutional buyers. Restricted securities comprise 1.2% of net
    assets applicable to common shares.

(b) All or a portion of these securities have been physically segregated in
    connection with open futures contracts.

(c) Security is a "step-up" bond where the coupon increases or steps up at a
    predetermined date.

(d) Non-income producing security.

(e) This borrower has filed for protection in federal bankruptcy court.

(f) Affiliated issuer. See Notes to Financial Statements

(g) The Trust owns 100% of the bond issuance.

AMBAC--AMBAC Indemnity Corp.

AMT--Alternative Minimum Tax

Comwth Gtd--Commonwealth of Puerto Rico

FGIC--Financial Guaranty Insurance Co.

FSA--Financial Security Assurance Inc.

GNMA--Government National Mortgage Association

MBIA--Municipal Bond Investors Assurance Corp.

Radian--Radian Asset Assurance

                                            See Notes to Financial Statements



                                      D-14


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

FINANCIAL STATEMENTS

Statement of Assets and Liabilities
October 31, 2004

<Table>
<S>                                                           <C>
ASSETS:
Total Investments (Cost $69,005,907)........................  $74,510,303
Receivables:
  Interest..................................................    1,084,909
  Investments Sold..........................................       35,320
Other.......................................................        1,291
                                                              -----------
    Total Assets............................................   75,631,823
                                                              -----------
LIABILITIES:
Payables:
  Custodian Bank............................................      107,931
  Investment Advisory Fee...................................       38,079
  Variation Margin on Futures...............................       23,438
  Income Distributions--Common Shares.......................       15,583
  Other Affiliates..........................................        6,821
Trustees' Deferred Compensation and Retirement Plans........      204,603
Accrued Expenses............................................       81,355
                                                              -----------
    Total Liabilities.......................................      477,810
Preferred Shares (including accrued distributions)..........   25,005,651
                                                              -----------
NET ASSETS APPLICABLE TO COMMON SHARES......................  $50,148,362
                                                              ===========
NET ASSET VALUE PER COMMON SHARE ($50,148,362 divided by
  4,839,000 shares outstanding).............................  $     10.36
                                                              ===========
NET ASSETS CONSIST OF:
Common Shares ($.01 par value with an unlimited number of
  shares authorized, 4,839,000 shares issued and
  outstanding)..............................................  $    48,390
Paid in Surplus.............................................   51,562,586
Net Unrealized Appreciation.................................    5,435,875
Accumulated Undistributed Net Investment Income.............     (166,136)
Accumulated Net Realized Loss...............................   (6,732,353)
                                                              -----------
NET ASSETS APPLICABLE TO COMMON SHARES......................  $50,148,362
                                                              ===========
PREFERRED SHARES ($.01 par value, authorized 100,000,000
  shares, 250 issued with liquidation preference of $100,000
  per share)................................................  $25,000,000
                                                              ===========
NET ASSETS INCLUDING PREFERRED SHARES.......................  $75,148,362
                                                              ===========
</Table>

See Notes to Financial Statements



                                      D-15


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

FINANCIAL STATEMENTS continued

Statement of Operations
For the Year Ended October 31, 2004

<Table>
<S>                                                           <C>
INVESTMENT INCOME:
Interest....................................................  $ 3,715,556
                                                              -----------
EXPENSES:
Investment Advisory Fee.....................................      446,772
Preferred Share Maintenance.................................       82,351
Trustees' Fees and Related Expenses.........................       57,987
Legal.......................................................       22,073
Custody.....................................................        5,565
Other.......................................................      139,847
                                                              -----------
    Total Expenses..........................................      754,595
                                                              -----------
NET INVESTMENT INCOME.......................................  $ 2,960,961
                                                              ===========
REALIZED AND UNREALIZED GAIN/LOSS:
Realized Gain/Loss:
  Investments...............................................  $(2,213,329)
  Futures...................................................     (640,859)
                                                              -----------
Net Realized Loss...........................................   (2,854,188)
                                                              -----------
Unrealized Appreciation/Depreciation:
  Beginning of the Period...................................    1,859,177
                                                              -----------
  End of the Period:
    Investments.............................................    5,504,396
    Futures.................................................      (68,521)
                                                              -----------
                                                                5,435,875
                                                              -----------
Net Unrealized Appreciation During the Period...............    3,576,698
                                                              -----------
NET REALIZED AND UNREALIZED GAIN............................  $   722,510
                                                              ===========
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS.....................  $  (279,002)
                                                              ===========
NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM
  OPERATIONS................................................  $ 3,404,469
                                                              ===========
</Table>

                                            See Notes to Financial Statements



                                      D-16


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

FINANCIAL STATEMENTS continued

Statements of Changes in Net Assets

<Table>
<Caption>
                                                                FOR THE            FOR THE
                                                               YEAR ENDED         YEAR ENDED
                                                            OCTOBER 31, 2004   OCTOBER 31, 2003
                                                            -----------------------------------
<S>                                                         <C>                <C>
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Income.....................................    $ 2,960,961        $ 3,033,160
Net Realized Gain/Loss....................................     (2,854,188)           841,950
Net Unrealized Appreciation/Depreciation During the
  Period..................................................      3,576,698           (334,213)
Distributions to Preferred Shareholders:
  Net Investment Income...................................       (279,002)          (271,360)
                                                              -----------        -----------
Change in Net Assets Applicable to Common Shares from
  Operations..............................................      3,404,469          3,269,537

Distributions to Common Shareholders:
  Net Investment Income...................................     (2,380,306)        (2,380,271)
                                                              -----------        -----------

NET CHANGE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM
  INVESTMENT ACTIVITIES...................................      1,024,163            889,266

NET ASSETS APPLICABLE TO COMMON SHARES:
Beginning of the Period...................................     49,124,199         48,234,933
                                                              -----------        -----------
End of the Period (Including accumulated undistributed net
  investment income of ($166,136) and ($466,689),
  respectively)...........................................    $50,148,362        $49,124,199
                                                              ===========        ===========
</Table>

See Notes to Financial Statements



                                      D-17


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

FINANCIAL HIGHLIGHTS

THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE COMMON SHARE OF THE
TRUST OUTSTANDING THROUGHOUT THE PERIODS INDICATED.

<Table>
<Caption>
                                                           --------------------------------
                                                             2004        2003      2002 (a)
                                                           --------------------------------
<S>                                                        <C>         <C>         <C>
NET ASSET VALUE, BEGINNING OF THE PERIOD.................  $  10.15    $   9.97    $  10.01
                                                           --------    --------    --------
  Net Investment Income..................................       .61         .63         .65
  Net Realized and Unrealized Gain/Loss..................       .15         .10       (.13)
  Common Share Equivalent of Distributions Paid to
    Preferred Shareholders:
    Net Investment Income................................     (.06)       (.06)       (.07)
                                                           --------    --------    --------
Total from Investment Operations.........................       .70         .67         .45
Distributions Paid to Common Shareholders:
  Net Investment Income..................................     (.49)       (.49)       (.49)
                                                           --------    --------    --------
NET ASSET VALUE, END OF THE PERIOD.......................  $  10.36    $  10.15    $   9.97
                                                           ========    ========    ========

Common Share Market Price at End of the Period...........  $   9.07    $   8.96    $   8.69
Total Return (b).........................................     6.85%       8.91%       5.64%
Net Assets Applicable to Common Shares at End of the
  Period (In millions)...................................  $   50.1    $   49.1    $   48.2
Ratio of Expenses to Average Net Assets Applicable to
  Common Shares (c)......................................     1.53%       1.49%       1.42%
Ratio of Net Investment Income to Average Net Assets
  Applicable to Common Shares (c)........................     5.99%       6.19%       6.62%
Portfolio Turnover.......................................       19%         36%         37%

SUPPLEMENTAL RATIOS:
Ratio of Expenses to Average Net Assets Including
  Preferred Shares (c)...................................     1.01%        .99%        .93%
Ratio of Net Investment Income to Average Net Assets
  Applicable to Common Shares (d)........................     5.42%       5.64%       5.87%

SENIOR SECURITIES:
Total Preferred Shares Outstanding.......................       250         250         250
Asset Coverage Per Preferred Share (e)...................  $300,616    $296,504    $292,949
Involuntary Liquidating Preference Per Preferred Share...  $100,000    $100,000    $100,000
Average Market Value Per Preferred Share.................  $100,000    $100,000    $100,000
</Table>

(a)As required, effective November 1, 2001, the Trust has adopted the provisions
   of the AICPA Audit and Accounting Guide for Investment Companies and began
   accreting market discount on fixed income securities. The effect of this
   change for the year ended October 31, 2002 was to increase net investment
   income per share by less than $.01, decrease net realized and unrealized
   gains and losses per share by less than $.01 and increase the ratio of net
   investment income to average net assets by .01%. Per share, ratios, and
   supplemental data for periods prior to October 31, 2002 have not been
   restated to reflect this change in presentation.

(b)Total return assumes an investment at the common share market price at the
   beginning of the period indicated, reinvestment of all distributions for the
   period in accordance with the Trust's dividend reinvestment plan, and sale of
   all shares at the closing common share price at the end of the period
   indicated.

(c)Ratios do not reflect the effect of dividend payments to preferred
   shareholders.

(d)Ratios reflect the effect of dividend payments to preferred shareholders.

(e)Calculated by subtracting the Trust's total liabilities (not including the
   preferred shares) from the Trust's total assets and dividing this by the
   number of preferred shares outstanding.




                                      D-18


<PAGE>


<Table>
<Caption>
YEAR ENDED OCTOBER 31,
- -------------------------------------------------------------------------------
       2001       2000       1999       1998       1997       1996       1995
- -------------------------------------------------------------------------------
<S>  <C>        <C>        <C>        <C>        <C>        <C>        <C>
     $   9.43   $   9.39   $  10.66   $  10.66   $  10.47   $  10.75   $  10.50
     --------   --------   --------   --------   --------   --------   --------
          .67        .76        .83        .86        .96        .88        .88
          .59        .09      (1.26)       .01        .12       (.19)       .40
         (.18)      (.21)      (.17)      (.19)      (.18)      (.19)      (.20)
     --------   --------   --------   --------   --------   --------   --------
         1.08        .64       (.60)       .68        .90        .50       1.08
         (.50)      (.60)      (.67)      (.68)      (.71)      (.78)      (.83)
     --------   --------   --------   --------   --------   --------   --------
     $  10.01   $   9.43   $   9.39   $  10.66   $  10.66   $  10.47   $  10.75
     ========   ========   ========   ========   ========   ========   ========

     $   8.70   $   8.08   $ 8.8125   $11.0625   $10.9375   $  11.00   $ 10.625
       14.11%     -1.60%    -15.09%      7.63%      6.13%     11.02%      2.88%
     $   48.4   $   45.6   $   45.4   $   51.6   $   51.6   $   50.7   $   52.0
        1.46%      1.52%      1.69%      1.47%      1.47%      1.51%      1.52%
        6.77%      8.25%      8.11%      8.14%      9.14%      8.32%      8.22%
          45%        41%        46%        33%        25%        39%        50%

         .96%       .98%      1.12%       .99%       .99%      1.01%      1.02%
        4.98%      5.92%      6.41%      6.40%      7.38%      6.55%      6.31%

          250        250        250        250        250        250        250
     $293,730   $282,465   $281,691   $306,365   $306,303   $302,730   $308,150
     $100,000   $100,000   $100,000   $100,000   $100,000   $100,000   $100,000
     $100,000   $100,000   $100,000   $100,000   $100,000   $100,000   $100,000
</Table>

See Notes to Financial Statements




                                  D-19


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004

1. SIGNIFICANT ACCOUNTING POLICIES

Van Kampen Investment Grade Municipal Trust (the "Trust") is registered as a
diversified, closed-end management investment company under the Investment
Company Act of 1940, as amended. The Trust's investment objective is to provide
a high level of current income exempt from federal income tax, consistent with
preservation of capital. The Trust will normally invest at least 80% of its
total assets in tax-exempt municipal securities rated investment grade at the
time of investment. The Trust commenced investment operations on November 30,
1989. Effective November 30, 2003, the Trust's investment adviser, Van Kampen
Investment Advisory Corp. merged into its affiliate, Van Kampen Asset Management
(the "Adviser").

    The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.

A. SECURITY VALUATION Municipal bonds are valued by independent pricing services
or dealers using the mean of the bid and asked prices or, in the absence of
market quotations, at fair value based upon yield data relating to municipal
bonds with similar characteristics and general market conditions. Securities
which are not valued by independent pricing services or dealers are valued at
fair value using procedures established in good faith by the Board of Trustees.
Futures contracts are valued at the settlement price established each day on the
exchange on which they are traded. Short-term securities with remaining
maturities of 60 days or less are valued at amortized cost, which approximates
market value.

B. SECURITY TRANSACTIONS Security transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis. The
Trust may purchase and sell securities on a "when-issued" or "delayed delivery"
basis with settlement to occur at a later date. The value of the security so
purchased is subject to market fluctuations during this period. The Trust will
segregate assets with its custodian having an aggregate value at least equal to
the amount of the when-issued or delayed delivery purchase commitments until
payment is made. At October 31, 2004, the Trust had no when-issued or delayed
delivery purchase commitments.

C. INVESTMENT INCOME Interest income is recorded on an accrual basis. Bond
premium is amortized and discount is accreted over the expected life of each
applicable security.

D. FEDERAL INCOME TAXES It is the Trust's policy to comply with the requirements
of the Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no provision for federal income taxes is required.

    The Trust intends to utilize provisions of the federal income tax laws which
allow it to carry a realized capital loss forward for eight years following the
year of the loss and offset such losses against any future realized capital
gains. At October 31, 2004, the Trust had an




                                      D-20

<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued

accumulated capital loss carryforward for tax purposes of $6,800,874, of which
$1,930,614 will expire on 10/31/05, $965 will expire on 10/31/07, $196,107 will
expire on 10/31/08, $840,184 will expire on 10/31/09, $929,222 will expire on
10/31/10, and $2,903,782 will expire on 10/31/12.

    At October 31, 2004, the cost and related gross unrealized appreciation and
depreciation are as follows:

<Table>
<S>                                                           <C>
Cost of investments for tax purposes........................  $68,985,823
                                                              ===========
Gross tax unrealized appreciation...........................  $ 5,880,802
Gross tax unrealized depreciation...........................     (356,322)
                                                              -----------
Net tax unrealized appreciation on investments..............  $ 5,524,480
                                                              ===========
</Table>

E. DISTRIBUTION OF INCOME AND GAINS The Trust declares and pays monthly
dividends from net investment income to common shareholders. Net realized gains,
if any, are distributed annually. Distributions from net realized gains for book
purposes may include short-term capital gains and a portion of futures gains,
which are included as ordinary income for tax purposes.

    The tax character of distributions paid during the years ended October 31,
2004 and 2003 were as follows:

<Table>
<Caption>
                                                               2004       2003
<S>                                                           <C>        <C>
Distributions paid from:
  Ordinary income...........................................  $15,735    $3,083
  Long-term capital gain....................................      -0-       -0-
                                                              -------    ------
                                                              $15,735    $3,083
                                                              =======    ======
</Table>

    Due to inherent differences in the recognition of income, expenses, and
realized gains/losses under accounting principles generally accepted in the
United States of America and federal income tax purposes, permanent differences
between book and tax basis reporting have been identified and appropriately
reclassified on the Statement of Assets and Liabilities. A permanent difference
relating to book to tax accretion differences totaling $1,100 was reclassified
from accumulated undistributed net investment income to accumulated net realized
gain.

    As of October 31, 2004, the components of distributable earnings on a tax
basis were as follows:

<Table>
<S>                                                           <C>
Undistributed ordinary income...............................  $9,230
</Table>

    Net realized gains or losses differ for financial and tax reporting purposes
primarily as a result of gains and losses recognized for tax purposes on open
futures transactions on October 31, 2004.

2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES

Under the terms of the Trust's Investment Advisory Agreement, the Adviser
provides investment advice and facilities to the Trust for an annual fee payable
monthly of .60% of the





                                      D-21

<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued

average daily net assets of the Trust. Effective November 1, 2004, the
investment advisory fee was reduced from .60% to .55%.

    For the year ended October 31, 2004, the Trust recognized expenses of
approximately $5,400 representing legal services provided by Skadden, Arps,
Slate, Meagher & Flom LLP, counsel to the Trust, of which a trustee of the Trust
is a partner who provides legal services to the Trust, and is therefore an
affiliated person.

    Under separate Accounting Services and Legal Services agreements, the
Adviser provides accounting and legal services to the Trust. The Adviser
allocates the cost of such services to each trust. For the year ended October
31, 2004, the Trust recognized expenses of approximately $26,300 representing
Van Kampen Investments Inc.'s or its affiliates' (collectively "Van Kampen")
cost of providing accounting and legal services to the Trust, which are reported
as part of "Other" and "Legal" expenses, respectively, in the Statement of
Operations.

    Certain officers and trustees of the Trust are also officers and directors
of Van Kampen. The Trust does not compensate its officers or trustees who are
also officers of Van Kampen.

    The Trust provides deferred compensation and retirement plans for its
trustees who are not officers of Van Kampen. Under the deferred compensation
plan, trustees may elect to defer all or a portion of their compensation to a
later date. Benefits under the retirement plan are payable upon retirement for a
ten-year period and are based upon each trustee's years of service to the Trust.
The maximum annual benefit per trustee under the plan is $2,500.

    During the period, the Trust owned shares of the following affiliated
company. Affiliated companies are defined by the Investment Company Act of 1940,
as amended, as those companies in which a fund holds 5% or more of the
outstanding voting securities.

<Table>
<Caption>
                                                                             MARKET
                                                    REALIZED     INTEREST    VALUE
NAME                                      PAR      GAIN/(LOSS)    INCOME    10/31/04     COST
<S>                                     <C>        <C>           <C>        <C>        <C>
Dogwood Addition PRD Muni Ppty Owners
  Multi-Purp Dist No 8 Maumelle, AK
  Impt Ser 2001 Rfdg..................  $425,960       $0        $36,710    $426,092   $425,960
</Table>

3. INVESTMENT TRANSACTIONS

During the period, the cost of purchases and proceeds from sales of investments,
excluding short-term investments, were $14,941,022 and $13,628,603,
respectively.

4. DERIVATIVE FINANCIAL INSTRUMENTS

A derivative financial instrument in very general terms refers to a security
whose value is "derived" from the value of an underlying asset, reference rate
or index.

    In order to seek to manage the interest rate exposure of the Trust's
portfolio in a changing interest rate environment, the Trust may purchase or
sell financial futures contracts or engage in transactions involving interest
rate swaps, caps, floors or collars. The Trust expects to enter into these
transactions primarily as a hedge against anticipated interest rate or
fixed-income market changes, for duration management or for risk management
purposes, but may also enter into these transactions to generate additional
income. All of the Trust's portfolio holdings, including derivative instruments,
are marked to market each day with the change in value reflected in the
unrealized appreciation/depreciation. Upon disposition, a




                                      D-22

<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued

realized gain or loss is recognized accordingly, except when taking delivery of
a security underlying a futures contract. In this instance, the recognition of
gain or loss is postponed until the disposal of the security underlying the
futures contract. Risks may arise as a result of the potential inability of the
counterparties to meet the terms of their contracts.

    During the period, the Trust invested in futures contracts, a type of
derivative. A futures contract is an agreement involving the delivery of a
particular asset on a specified future date at an agreed upon price. The Trust
generally invests in exchange traded futures on U.S. Treasury Bonds and Notes
and typically closes the contract prior to delivery date. Upon entering into
futures contracts, the Trust maintains an amount of cash or liquid securities
with a value equal to a percentage of the contract amount with either a future
commission merchant pursuant to rules and regulations promulgated under the
Investment Company Act of 1940, as amended, or with its custodian in an account
in the broker's name. This amount is known as initial margin. During the period
the futures contract is open, payments are received from or made to the broker
based upon changes in the value of the contract (the variation margin). The risk
of loss associated with a futures contract is in excess of the variation margin
reflected on the Statement of Assets and Liabilities.

    Transactions in futures contracts, each with a par value of $100,000, for
the year ended October 31, 2004, were as follows:

<Table>
<Caption>
                                                              CONTRACTS
<S>                                                           <C>
Outstanding at October 31, 2003.............................      62
Futures Opened..............................................     418
Futures Closed..............................................    (385)
                                                                ----
Outstanding at October 31, 2004.............................      95
                                                                ====
</Table>

    The futures contracts outstanding as of October 31, 2004 and the
descriptions and unrealized appreciation/depreciation are as follows:

<Table>
<Caption>
                                                                            UNREALIZED
                                                                           APPRECIATION/
                                                              CONTRACTS    DEPRECIATION
<S>                                                           <C>          <C>
SHORT CONTRACTS:
  U.S. Treasury Notes 10-Year Futures December 2004 (Current
    Notional Value of $113,563 per contract)................     17          $(19,459)
  U.S. Treasury Notes 5-Year Futures December 2004 (Current
    Notional Value of $111,375 per contract)................     78           (49,062)
                                                                 --          --------
                                                                 95          $(68,521)
                                                                 ==          ========
</Table>

5. PREFERRED SHARES

The Trust has outstanding 250 Remarketed Preferred Shares ("RP"). Dividends are
cumulative and the dividend rate is currently reset every 28 days through a
remarketing process. The rate in effect on October 31, 2004 was 1.650%. During
the year ended October 31, 2004, the rates ranged from 0.923% to 1.650%.

    The Trust pays annual fees equivalent to .25% of the preferred share
liquidation value for the remarketing efforts associated with the preferred
shares. These fees are included as a component of "Preferred Share Maintenance"
expense in the Statement of Operations.




                                      D-23

<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued

    The RP are redeemable at the option of the Trust in whole or in part at the
liquidation value of $100,000 per share plus accumulated and unpaid dividends.
The Trust is subject to certain asset coverage tests and the RP are subject to
mandatory redemption if the tests are not met.

6. INDEMNIFICATIONS

The Fund enters into contracts that contain a variety of indemnifications. The
Fund's maximum exposure under these arrangements is unknown. However, the Fund
has not had prior claims or losses pursuant to these contracts and expects the
risk of loss to be remote.



                                      D-24


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Trustees and Shareholders of Van Kampen Investment Grade
Municipal Trust

We have audited the accompanying statement of assets and liabilities of Van
Kampen Investment Grade Municipal Trust (the "Trust"), including the portfolio
of investments, as of October 31, 2004, the related statement of operations for
the year then ended, the statements of changes in net assets for each of the two
years in the period then ended, and the financial highlights for each of the
five years in the period then ended. These financial statements and financial
highlights are the responsibility of the Trust's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits. The Trust's financial highlights for the periods ended
prior to October 31, 2000 were audited by other auditors whose report, dated
December 6, 1999, expressed an unqualified opinion on those financial
highlights.

    We conducted our audits in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned as of October 31, 2004, by correspondence with the Trust's
custodian. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

    In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of Van
Kampen Investment Grade Municipal Trust as of October 31, 2004, the results of
its operations for the year then ended, the changes in its net assets and the
financial highlights for the respective stated periods, in conformity with
accounting principles generally accepted in the United States of America.

DELOITTE & TOUCHE LLP
Chicago, Illinois
December 10, 2004




                                      D-25

<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

DIVIDEND REINVESTMENT PLAN

    The Trust offers a dividend reinvestment plan (the "Plan") pursuant to which
Common Shareholders may elect to have dividends and capital gains distributions
reinvested in Common Shares of the Trust. The Trust declares dividends out of
net investment income, and will distribute annually net realized capital gains,
if any. Common Shareholders may join or withdraw from the Plan at any time.

    If you decide to participate in the Plan, State Street Bank and Trust
Company, as your Plan Agent, will automatically invest your dividends and
capital gains distributions in Common Shares of the Trust for your account.

HOW TO PARTICIPATE

    If you wish to participate and your shares are held in your own name, call
1-800-341-2929 for more information and a Plan brochure. If your shares are held
in the name of a brokerage firm, bank, or other nominee, you should contact your
nominee to see if it would participate in the Plan on your behalf. If you wish
to participate in the Plan, but your brokerage firm, bank or nominee is unable
to participate on your behalf, you should request that your shares be
re-registered in your own name which will enable your participation in the Plan.

HOW THE PLAN WORKS

    Participants in the Plan will receive the equivalent in Common Shares valued
on the valuation date, generally at the lower of market price or net asset
value, except as specified below. The valuation date will be the dividend or
distribution payment date or, if that date is not a trading day on the national
securities exchange or market system on which the Common Shares are listed for
trading, the next preceding trading day. If the market price per Common Share on
the valuation date equals or exceeds net asset value per Common Share on that
date, the Trust will issue new Common Shares to participants valued at the
higher of net asset value or 95% of the market price on the valuation date. In
the foregoing situation, the Trust will not issue Common Shares under the Plan
below net asset value. If net asset value per Common Share on the valuation date
exceeds the market price per Common Share on that date, or if the Board of
Trustees should declare a dividend or capital gains distribution payable to the
Common Shareholders only in cash, participants in the Plan will be deemed to
have elected to receive Common Shares from the Trust valued at the market price
on that date. Accordingly, in this circumstance, the Plan Agent will, as agent
for the participants, buy the Trust's Common Shares in the open market for the
participants' accounts on or shortly after the payment date. If, before the Plan
Agent has completed its purchases, the market price exceeds the net asset value
per share of the Common Shares, the average per share purchase price paid by the
Plan Agent may exceed the net asset value



                                      D-26

<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

DIVIDEND REINVESTMENT PLAN continued

of the Trust's Common Shares, resulting in the acquisition of fewer Common
Shares than if the dividend or distribution had been paid in Common Shares
issued by the Trust. All reinvestments are in full and fractional Common shares
and are carried to three decimal places.

    Experience under the Plan may indicate that changes are desirable.
Accordingly, the Trust reserves the right to amend or terminate the Plan as
applied to any dividend or distribution paid subsequent to written notice of the
change sent to all Common Shareholders of the Trust at least 90 days before the
record date for the dividend or distribution. The Plan also may be amended or
terminated by the Plan Agent by at least 90 days written notice to all Common
Shareholders of the Trust.

COSTS OF THE PLAN

    The Plan Agent's fees for the handling of the reinvestment of dividends and
distributions will be paid by the Trust. However, each participant will pay a
pro rata share of brokerage commissions incurred with respect to the Plan
Agent's open market purchases in connection with the reinvestment of dividends
and distributions. No other charges will be made to participants for reinvesting
dividends or capital gains distributions, except for certain brokerage
commissions, as described above.

TAX IMPLICATIONS

    You will receive tax information annually for your personal records and to
help you prepare your federal income tax return. The automatic reinvestment of
dividends and capital gains distributions does not relieve you of any income tax
which may be payable on dividends or distributions.

RIGHT TO WITHDRAW

    Plan participants may withdraw at any time by calling 1-800-341-2929 or by
writing State Street Bank and Trust Company, P.O. Box 8200, Boston, MA
02266-8200. If you withdraw, you will receive, without charge, a share
certificate issued in your name for all full Common Shares credited to your
account under the Plan and a cash payment will be made for any fractional Common
Share credited to your account under the Plan. You may again elect to
participate in the Plan at any time by calling 1-800-341-2929 or writing to the
Trust at:

                              Van Kampen Funds Inc.
                              Attn: Closed-End Funds
                                2800 Post Oak Blvd.
                                 Houston, TX 77056




                                      D-27


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

BOARD OF TRUSTEES AND IMPORTANT ADDRESSES

BOARD OF TRUSTEES

DAVID C. ARCH
J. MILES BRANAGAN
JERRY D. CHOATE
ROD DAMMEYER
LINDA HUTTON HEAGY
R. CRAIG KENNEDY
HOWARD J KERR
MITCHELL M. MERIN*
JACK E. NELSON
RICHARD F. POWERS, III*
HUGO F. SONNENSCHEIN
WAYNE W. WHALEN* - Chairman
SUZANNE H. WOOLSEY

INVESTMENT ADVISER

VAN KAMPEN ASSET MANAGEMENT
1221 Avenue of the Americas
New York, NY 10020

CUSTODIAN AND TRANSFER AGENT

STATE STREET BANK
AND TRUST COMPANY
c/o EquiServe
P.O. Box 43011
Providence, Rhode Island 02940-3011


LEGAL COUNSEL

SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
333 West Wacker Drive
Chicago, Illinois 60606

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

DELOITTE & TOUCHE LLP
180 North Stetson Avenue
Chicago, Illinois 60601

 For federal income tax purposes, the following information is furnished with
 respect to the distributions paid by the Trust during its taxable year ended
 October 31, 2004. The Trust designated 99.4% of the income distributions as a
 tax-exempt income distribution. In January, the Trust provides tax information
 to shareholders for the preceding calendar year.

*   "Interested persons" of the Trust, as defined in the Investment Company Act
    of 1940, as amended.



                                      D-28

<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

RESULTS OF SHAREHOLDER VOTES

The Annual Meeting of the Shareholders of the Trust was held on June 23, 2004,
where shareholders voted on the election of trustees.

With regard to the election of the following trustees by the common shareholders
of the Trust:

<Table>
<Caption>
                                                                      # OF SHARES
                                                             -----------------------------
                                                             IN FAVOR             WITHHELD
- ------------------------------------------------------------------------------------------
<S>                                                          <C>                  <C>
J. Miles Branagan..........................................  4,130,248            373,364
Linda Hutton Heagy.........................................  4,131,548            372,064
Mitchell M. Merin..........................................  4,134,834            368,778
Wayne W. Whalen............................................  4,130,740            372,872
</Table>

The other trustees of the Trust whose terms did not expire in 2004 are David C.
Arch, Jerry D. Choate, Rod Dammeyer, R. Craig Kennedy, Howard J Kerr, Jack E.
Nelson, Richard F. Powers III, Hugo F. Sonnenschein, and Suzanne H. Woolsey.




                                  D-29


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

TRUSTEE AND OFFICER INFORMATION

The business and affairs of the Trust are managed under the direction of the
Trust's Board of Trustees and the Trust's officers appointed by the Board of
Trustees. The tables below list the trustees and executive officers of the Trust
and their principal occupations during the last five years, other directorships
held by trustees and their affiliations, if any, with Van Kampen Investments
Inc. ("Van Kampen Investments"), Van Kampen Asset Management (the "Adviser"),
Van Kampen Funds Inc. (the "Distributor"), Van Kampen Advisors Inc., Van Kampen
Exchange Corp. and Van Kampen Investor Services Inc. ("Investor Services"). The
term "Fund Complex" includes each of the investment companies advised by the
Adviser or its affiliates as of the date of this Statement of Additional
Information. Trustees serve until reaching their retirement age or until their
successors are duly elected and qualified. Officers are annually elected by the
trustees.

INDEPENDENT TRUSTEES:

<Table>
<Caption>
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE           TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>
David C. Arch (59)            Trustee      Trustee     Chairman and Chief             85       Trustee/Director/Managing
Blistex Inc.                               since 1989  Executive Officer of                    General Partner of funds
1800 Swift Drive                                       Blistex Inc., a consumer                in the Fund Complex.
Oak Brook, IL 60523                                    health care products
                                                       manufacturer. Director of
                                                       the Heartland Alliance, a
                                                       nonprofit organization
                                                       serving human needs based
                                                       in Chicago. Director of
                                                       St. Vincent de Paul
                                                       Center, a Chicago based
                                                       day care facility serving
                                                       the children of low
                                                       income families. Board
                                                       member of the Illinois
                                                       Manufacturers'
                                                       Association.

J. Miles Branagan (72)        Trustee      Trustee     Private investor.              83       Trustee/Director/Managing
1632 Morning Mountain Road                 since 2003  Co-founder, and prior to                General Partner of funds
Raleigh, NC 27614                                      August 1996, Chairman,                  in the Fund Complex.
                                                       Chief Executive Officer
                                                       and President, MDT
                                                       Corporation (now known as
                                                       Getinge/Castle, Inc., a
                                                       subsidiary of Getinge
                                                       Industrier AB), a company
                                                       which develops,
                                                       manufactures, markets and
                                                       services medical and
                                                       scientific equipment.
</Table>



                                      D-30


<PAGE>


<Table>
<Caption>
VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE           TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Jerry D. Choate (66)          Trustee      Trustee     Prior to January 1999,         83       Trustee/Director/Managing
33971 Selva Road                           since 2003  Chairman and Chief                      General Partner of funds
Suite 130                                              Executive Officer of the                in the Fund Complex.
Dana Point, CA 92629                                   Allstate Corporation                    Director of Amgen Inc., a
                                                       ("Allstate") and Allstate               biotechnological company,
                                                       Insurance Company. Prior                and Director of Valero
                                                       to January 1995,                        Energy Corporation, an
                                                       President and Chief                     independent refining
                                                       Executive Officer of                    company.
                                                       Allstate. Prior to August
                                                       1994, various management
                                                       positions at Allstate.
</Table>




                                      D-31


<PAGE>


<Table>
<Caption>
VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE           TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Rod Dammeyer (64)             Trustee      Trustee     President of CAC, L.L.C.,      85       Trustee/Director/Managing
CAC, L.L.C.                                since 1989  a private company                       General Partner of funds
4350 LaJolla Village Drive                             offering capital                        in the Fund Complex.
Suite 980                                              investment and management               Director of Stericycle,
San Diego, CA 92122-6223                               advisory services. Prior                Inc., Ventana Medical
                                                       to February 2001, Vice                  Systems, Inc., and GATX
                                                       Chairman and Director of                Corporation, and Trustee
                                                       Anixter International,                  of The Scripps Research
                                                       Inc., a global                          Institute and the
                                                       distributor of wire,                    University of Chicago
                                                       cable and communications                Hospitals and Health
                                                       connectivity products.                  Systems. Prior to January
                                                       Prior to July 2000,                     2004, Director of
                                                       Managing Partner of                     TeleTech Holdings Inc.
                                                       Equity Group Corporate                  and Arris Group, Inc.
                                                       Investment (EGI), a                     Prior to May 2002,
                                                       company that makes                      Director of Peregrine
                                                       private investments in                  Systems Inc. Prior to
                                                       other companies.                        February 2001, Director
                                                                                               of IMC Global Inc. Prior
                                                                                               to July 2000, Director of
                                                                                               Allied Riser
                                                                                               Communications Corp.,
                                                                                               Matria Healthcare Inc.,
                                                                                               Transmedia Networks,
                                                                                               Inc., CNA Surety, Corp.
                                                                                               and Grupo Azcarero Mexico
                                                                                               (GAM).
</Table>



                                      D-32



<PAGE>


<Table>
<Caption>
VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE           TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Linda Hutton Heagy (56)       Trustee      Trustee     Managing Partner of            83       Trustee/Director/Managing
Heidrick & Struggles                       since 2003  Heidrick & Struggles, an                General Partner of funds
233 South Wacker Drive                                 executive search firm.                  in the Fund Complex.
Suite 7000                                             Trustee on the University
Chicago, IL 60606                                      of Chicago Hospitals
                                                       Board, Vice Chair of the
                                                       Board of the YMCA of
                                                       Metropolitan Chicago and
                                                       a member of the Women's
                                                       Board of the University
                                                       of Chicago. Prior to
                                                       1997, Partner of Ray &
                                                       Berndtson, Inc., an
                                                       executive recruiting
                                                       firm. Prior to 1996,
                                                       Trustee of The
                                                       International House
                                                       Board, a fellowship and
                                                       housing organization for
                                                       international graduate
                                                       students. Prior to 1995,
                                                       Executive Vice President
                                                       of ABN AMRO, N.A., a bank
                                                       holding company. Prior to
                                                       1992, Executive Vice
                                                       President of La Salle
                                                       National Bank.

R. Craig Kennedy (52)         Trustee      Trustee     Director and President of      83       Trustee/Director/Managing
1744 R Street, NW                          since 2003  the German Marshall Fund                General Partner of funds
Washington, DC 20009                                   of the United States, an                in the Fund Complex.
                                                       independent U.S.
                                                       foundation created to
                                                       deepen understanding,
                                                       promote collaboration and
                                                       stimulate exchanges of
                                                       practical experience
                                                       between Americans and
                                                       Europeans. Formerly,
                                                       advisor to the Dennis
                                                       Trading Group Inc., a
                                                       managed futures and
                                                       option company that
                                                       invests money for
                                                       individuals and
                                                       institutions. Prior to
                                                       1992, President and Chief
                                                       Executive Officer,
                                                       Director and member of
                                                       the Investment Committee
                                                       of the Joyce Foundation,
                                                       a private foundation.

Howard J Kerr (69)            Trustee      Trustee     Prior to 1998, President       85       Trustee/Director/Managing
736 North Western Avenue                   since 1992  and Chief Executive                     General Partner of funds
P.O. Box 317                                           Officer of Pocklington                  in the Fund Complex.
Lake Forest, IL 60045                                  Corporation, Inc., an                   Director of the Lake
                                                       investment holding                      Forest Bank & Trust.
                                                       company. Director of the
                                                       Marrow Foundation.
</Table>




                                      D-33

<PAGE>


<Table>
<Caption>
VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE           TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Jack E. Nelson (68)           Trustee      Trustee     President of Nelson            83       Trustee/Director/Managing
423 Country Club Drive                     since 2003  Investment Planning                     General Partner of funds
Winter Park, FL 32789                                  Services, Inc., a                       in the Fund Complex.
                                                       financial planning
                                                       company and registered
                                                       investment adviser in the
                                                       State of Florida.
                                                       President of Nelson Ivest
                                                       Brokerage Services Inc.,
                                                       a member of the NASD,
                                                       Securities Investors
                                                       Protection Corp. and the
                                                       Municipal Securities
                                                       Rulemaking Board.
                                                       President of Nelson Sales
                                                       and Services Corporation,
                                                       a marketing and services
                                                       company to support
                                                       affiliated companies.

Hugo F. Sonnenschein (64)     Trustee      Trustee     President Emeritus and         85       Trustee/Director/Managing
1126 E. 59th Street                        since 1994  Honorary Trustee of the                 General Partner of funds
Chicago, IL 60637                                      University of Chicago and               in the Fund Complex.
                                                       the Adam Smith                          Director of Winston
                                                       Distinguished Service                   Laboratories, Inc.
                                                       Professor in the
                                                       Department of Economics
                                                       at the University of
                                                       Chicago. Prior to July
                                                       2000, President of the
                                                       University of Chicago.
                                                       Trustee of the University
                                                       of Rochester and a member
                                                       of its investment
                                                       committee. Member of the
                                                       National Academy of
                                                       Sciences, the American
                                                       Philosophical Society and
                                                       a fellow of the American
                                                       Academy of Arts and
                                                       Sciences.

Suzanne H. Woolsey, Ph.D.     Trustee      Trustee     Chief Communications           83       Trustee/Director/Managing
(62)                                       since 2003  Officer of the National                 General Partner of funds
815 Cumberstone Road                                   Academy of                              in the Fund Complex.
Harwood, MD 20776                                      Sciences/National                       Director of Fluor Corp.,
                                                       Research Council, an                    an engineering,
                                                       independent, federally                  procurement and
                                                       chartered policy                        construction
                                                       institution, from 2001 to               organization, since
                                                       November 2003 and Chief                 January 2004 and Director
                                                       Operating Officer from                  of Neurogen Corporation,
                                                       1993 to 2001. Director of               a pharmaceutical company,
                                                       the Institute for Defense               since January 1998.
                                                       Analyses, a federally
                                                       funded research and
                                                       development center,
                                                       Director of the German
                                                       Marshall Fund of the
                                                       United States, Director
                                                       of the Rocky Mountain
                                                       Institute and Trustee of
                                                       Colorado College. Prior
                                                       to 1993, Executive
                                                       Director of the
                                                       Commission on Behavioral
                                                       and Social Sciences and
                                                       Education at the National
                                                       Academy of
                                                       Sciences/National
                                                       Research Council. From
                                                       1980 through 1989,
                                                       Partner of Coopers &
                                                       Lybrand.
</Table>




                                      D-34


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

TRUSTEE AND OFFICER INFORMATION continued

INTERESTED TRUSTEES:*

<Table>
<Caption>
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INTERESTED TRUSTEE            TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Mitchell M. Merin* (51)       Trustee,     Trustee     President and Chief            83       Trustee/Director/Managing
1221 Avenue of the Americas   President    since       Executive Officer of                    General Partner of funds
New York, NY 10020            and Chief    2003;       funds in the Fund                       in the Fund Complex.
                              Executive    President   Complex. Chairman,
                              Officer      and Chief   President, Chief
                                           Executive   Executive Officer and
                                           Officer     Director of the Adviser
                                           since 2002  and Van Kampen Advisors
                                                       Inc. since December 2002.
                                                       Chairman, President and
                                                       Chief Executive Officer
                                                       of Van Kampen Investments
                                                       since December 2002.
                                                       Director of Van Kampen
                                                       Investments since
                                                       December 1999. Chairman
                                                       and Director of Van
                                                       Kampen Funds Inc. since
                                                       December 2002. President,
                                                       Director and Chief
                                                       Operating Officer of
                                                       Morgan Stanley Investment
                                                       Management since December
                                                       1998. President and
                                                       Director since April 1997
                                                       and Chief Executive
                                                       Officer since June 1998
                                                       of Morgan Stanley
                                                       Investment Advisors Inc.
                                                       and Morgan Stanley
                                                       Services Company Inc.
                                                       Chairman, Chief Executive
                                                       Officer and Director of
                                                       Morgan Stanley
                                                       Distributors Inc. since
                                                       June 1998. Chairman since
                                                       June 1998, and Director
                                                       since January 1998 of
                                                       Morgan Stanley Trust.
                                                       Director of various
                                                       Morgan Stanley
                                                       subsidiaries. President
                                                       of the Morgan Stanley
                                                       Funds since May 1999.
                                                       Previously Chief
                                                       Executive Officer of Van
                                                       Kampen Funds Inc. from
                                                       December 2002 to July
                                                       2003, Chief Strategic
                                                       Officer of Morgan Stanley
                                                       Investment Advisors Inc.
                                                       and Morgan Stanley
                                                       Services Company Inc. and
                                                       Executive Vice President
                                                       of Morgan Stanley
                                                       Distributors Inc. from
                                                       April 1997 to June 1998.
                                                       Chief Executive Officer
                                                       from September 2002 to
                                                       April 2003 and Vice
                                                       President from May 1997
                                                       to April 1999 of the
                                                       Morgan Stanley Funds.
</Table>




                                      D-35

<PAGE>


<Table>
<Caption>
VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                                                  NUMBER OF
                                            TERM OF                                FUNDS IN
                                           OFFICE AND                                FUND
                              POSITION(S)  LENGTH OF                               COMPLEX
NAME, AGE AND ADDRESS          HELD WITH      TIME     PRINCIPAL OCCUPATION(S)     OVERSEEN    OTHER DIRECTORSHIPS
OF INTERESTED TRUSTEE            TRUST       SERVED    DURING PAST 5 YEARS        BY TRUSTEE   HELD BY TRUSTEE
<S>                           <C>          <C>         <C>                        <C>          <C>

Richard F. Powers, III* (58)  Trustee      Trustee     Advisory Director of           85       Trustee/Director/Managing
1 Parkview Plaza                           since 1999  Morgan Stanley. Prior to                General Partner of funds
P.O. Box 5555                                          December 2002, Chairman,                in the Fund Complex.
Oakbrook Terrace, IL 60181                             Director, President,
                                                       Chief Executive Officer
                                                       and Managing Director of
                                                       Van Kampen Investments
                                                       and its investment
                                                       advisory, distribution
                                                       and other subsidiaries.
                                                       Prior to December 2002,
                                                       President and Chief
                                                       Executive Officer of
                                                       funds in the Fund
                                                       Complex. Prior to May
                                                       1998, Executive Vice
                                                       President and Director of
                                                       Marketing at Morgan
                                                       Stanley and Director of
                                                       Dean Witter, Discover &
                                                       Co. and Dean Witter
                                                       Realty. Prior to 1996,
                                                       Director of Dean Witter
                                                       Reynolds Inc.

Wayne W. Whalen* (65)         Trustee      Trustee     Partner in the law firm        85       Trustee/Director/Managing
333 West Wacker Drive                      since 1989  of Skadden, Arps, Slate,                General Partner of funds
Chicago, IL 60606                                      Meagher & Flom LLP, legal               in the Fund Complex.
                                                       counsel to funds in the
                                                       Fund Complex.
</Table>

*   Such Trustee is an "interested person" (within the meaning of Section
    2(a)(19) of the 1940 Act). Mr. Whalen is an interested person of certain
    funds in the Fund Complex by reason of his firm currently acting as legal
    counsel to such funds in the Fund Complex. Messrs. Merin and Powers are
    interested persons of funds in the Fund Complex and the Adviser by reason of
    their current or former positions with Morgan Stanley or its affiliates.




                                      D-36


<PAGE>


VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST

TRUSTEE AND OFFICER INFORMATION continued

OFFICERS:

<Table>
<Caption>
                                                     TERM OF
                                                    OFFICE AND
                                   POSITION(S)      LENGTH OF
NAME, AGE AND                       HELD WITH          TIME     PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER                    TRUST           SERVED    DURING PAST 5 YEARS
<S>                             <C>                 <C>         <C>
Stefanie V. Chang (38)          Vice President      Officer     Executive Director of Morgan Stanley Investment Management.
1221 Avenue of the Americas     and Secretary       since 2003  Vice President of funds in the Fund Complex.
New York, NY 10020

Amy R. Doberman (42)            Vice President      Officer     Managing Director and General Counsel, U.S. Investment
1221 Avenue of the Americas                         since 2004  Management; Managing Director of Morgan Stanley Investment
New York, NY 10020                                              Management, Inc., Morgan Stanley Investment Advisers Inc.
                                                                and the Adviser. Vice President of the Morgan Stanley
                                                                Institutional and Retail Funds since July 2004 and Vice
                                                                President of funds in the Fund Complex as of August 2004.
                                                                Previously, Managing Director and General Counsel of
                                                                Americas, UBS Global Asset Management from July 2000 to July
                                                                2004 and General Counsel of Aeitus Investment Management,
                                                                Inc. from January 1997 to July 2000.

James M. Dykas (38)             Chief Financial     Officer     Executive Director of Van Kampen Asset Management and Morgan
1 Parkview Plaza                Officer and         since 1999  Stanley Investment Management. Chief Financial Officer and
Oakbrook Terrace, IL 60181      Treasurer                       Treasurer of funds in the Fund Complex. Prior to August
                                                                2004, Assistant Treasurer of funds in the Fund Complex.

Joseph J. McAlinden (61)        Executive Vice      Officer     Managing Director and Chief Investment Officer of Morgan
1221 Avenue of the Americas     President and       since 2002  Stanley Investment Advisors Inc., and Morgan Stanley
New York, NY 10020              Chief Investment                Investment Management Inc. and Director of Morgan Stanley
                                Officer                         Trust for over 5 years. Executive Vice President and Chief
                                                                Investment Officer of funds in the Fund Complex. Managing
                                                                Director and Chief Investment Officer of Van Kampen
                                                                Investments, the Adviser and Van Kampen Advisors Inc. since
                                                                December 2002.

Ronald E. Robison (65)          Executive Vice      Officer     Principal Executive Officer of the Funds since May 2003.
1221 Avenue of the Americas     President and       since 2003  Chief Executive Officer and Chairman of Investor Services.
New York, NY 10020              Principal                       Executive Vice President and Principal Executive Officer of
                                Executive                       funds in the Fund Complex. Managing Director of Morgan
                                Officer                         Stanley. Chief Administrative Officer, Managing Director and
                                                                Director of Morgan Stanley Investment Advisors Inc., Morgan
                                                                Stanley Services Company Inc. and Managing Director and
                                                                Director of Morgan Stanley Distributors Inc. Chief Executive
                                                                Officer and Director of Morgan Stanley Trust. Executive Vice
                                                                President and Principal Executive Officer of the
                                                                Institutional and Retail Morgan Stanley Funds; Director of
                                                                Morgan Stanley SICAV; previously Chief Global Operations
                                                                Officer and Managing Director of Morgan Stanley Investment
                                                                Management Inc.
</Table>




                                      D-37

<PAGE>


<Table>
<Caption>
VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
                                                     TERM OF
                                                    OFFICE AND
                                   POSITION(S)      LENGTH OF
NAME, AGE AND                       HELD WITH          TIME     PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER                    TRUST           SERVED    DURING PAST 5 YEARS
<S>                             <C>                 <C>         <C>

John L. Sullivan (49)           Chief Compliance    Officer     Chief Compliance Officer of funds in the Fund Complex since
1 Parkview Plaza                Officer             since 1998  August 2004. Director and Managing Director of Van Kampen
Oakbrook Terrace, IL 60181                                      Investments, the Adviser, Van Kampen Advisors Inc. and
                                                                certain other subsidiaries of Van Kampen Investments. Prior
                                                                August 2004, Vice President, Chief Financial Officer and
                                                                Treasurer of funds in the Fund Complex and head of Fund
                                                                Accounting for Morgan Stanley Investment Management. Prior
                                                                to December 2002, Executive Director of Van Kampen
                                                                Investments, the Adviser and Van Kampen Advisors Inc.
</Table>




                                  D-38


<PAGE>


VAN KAMPEN

AN IMPORTANT NOTICE CONCERNING OUR U.S. PRIVACY POLICY

    We are required by federal law to provide you with a copy of our Privacy
Policy annually.

    The following Policy applies to current and former individual clients of Van
Kampen Investments Inc., Van Kampen Asset Management, Van Kampen Advisors Inc.,
Van Kampen Funds Inc., Van Kampen Investor Services Inc. and Van Kampen Exchange
Corp., as well as current and former individual investors in Van Kampen mutual
funds, unit investment trusts, and related companies.

    This Policy is not applicable to partnerships, corporations, trusts or other
non-individual clients or account holders, nor is this Policy applicable to
individuals who are either beneficiaries of a trust for which we serve as
trustee or participants in an employee benefit plan administered or advised by
us. This Policy is, however, applicable to individuals who select us to be a
custodian of securities or assets in individual retirement accounts, 401(k)
accounts, 529 Educational Savings Accounts, accounts subject to the Uniform
Gifts to Minors Act, or similar accounts.

    Please note that we may amend this Policy at any time, and will inform you
of any changes to this Policy as required by law.

WE RESPECT YOUR PRIVACY

We appreciate that you have provided us with your personal financial
information. We strive to maintain the privacy of such information while we help
you achieve your financial objectives. This Policy describes what non-public
personal information we collect about you, why we collect it, and when we may
share it with others.

    We hope this Policy will help you understand how we collect and share
non-public personal information that we gather about you. Throughout this
Policy, we refer to the non-public information that personally identifies you or
your accounts as "personal information."

1. WHAT PERSONAL INFORMATION DO WE COLLECT ABOUT YOU?

To serve you better and manage our business, it is important that we collect and
maintain accurate information about you. We may obtain this information from
applications and other forms you submit to us, from your dealings with us, from
consumer reporting agencies, from our Web sites and from third parties and other
sources.

    For example:

     --  We may collect information such as your name, address, e-mail address,
         telephone/fax numbers, assets, income and investment objectives through
         applications and other forms you submit to us.

     --  We may obtain information about account balances, your use of
         account(s) and the types of products and services you prefer to receive
         from us through your dealings and transactions with us and other
         sources.

     --  We may obtain information about your creditworthiness and credit
         history from consumer reporting agencies.

     --  We may collect background information from and through third-party
         vendors to verify representations you have made and to comply with
         various regulatory requirements.

     --  If you interact with us through our public and private Web sites, we
         may collect information that you provide directly through online
         communications (such as an e-mail address). We may also collect
         information about your Internet service provider, your domain name,
         your computer's operating system and Web browser,

                                                             (continued on back)




                                      D-39

<PAGE>


VAN KAMPEN

AN IMPORTANT NOTICE CONCERNING OUR U.S. PRIVACY POLICY continued

your use of our Web sites and your product and service preferences, through the
use of "cookies." "Cookies" recognize your computer each time you return to one
      of our sites, and help to improve our sites' content and personalize your
      experience on our sites by, for example, suggesting offerings that may
      interest you. Please consult the Terms of Use of these sites for more
      details on our use of cookies.

2. WHEN DO WE DISCLOSE PERSONAL INFORMATION WE COLLECT ABOUT YOU?

To provide you with the products and services you request, to serve you better
and to manage our business, we may disclose personal information we collect
about you to our affiliated companies and to non-affiliated third parties as
required or permitted by law.

A. INFORMATION WE DISCLOSE TO OUR AFFILIATED COMPANIES. We do not disclose
personal information that we collect about you to our affiliated companies
except to enable them to provide services on our behalf or as otherwise required
or permitted by law.

B. INFORMATION WE DISCLOSE TO THIRD PARTIES. We do not disclose personal
information that we collect about you to non-affiliated third parties except to
enable them to provide services on our behalf, to perform joint marketing
agreements with other financial institutions, or as otherwise required or
permitted by law. For example, some instances where we may disclose information
about you to non-affiliated third parties include: for servicing and processing
transactions, to offer our own products and services, to protect against fraud,
for institutional risk control, to respond to judicial process or to perform
services on our behalf. When we share personal information with these companies,
they are required to limit their use of personal information to the particular
purpose for which it was shared and they are not allowed to share personal
information with others except to fulfill that limited purpose.

3. HOW DO WE PROTECT THE SECURITY AND CONFIDENTIALITY OF PERSONAL INFORMATION WE
COLLECT ABOUT YOU?

We maintain physical, electronic and procedural security measures to help
safeguard the personal information we collect about you. We have internal
policies governing the proper handling of client information. Third parties that
provide support or marketing services on our behalf may also receive personal
information, and we require them to adhere to confidentiality standards with
respect to such information.

                                                 Van Kampen Funds Inc.
                                                 1 Parkview Plaza, P.O. Box 5555
                                                 Oakbrook Terrace, IL 60181-5555
                                                 www.vankampen.com

                                      (VAN KAMPEN INVESTMENTS LOGO)

                                                 Copyright (C)2004 Van Kampen
                                                 Funds Inc. All rights reserved.
                                                 Member NASD/SIPC.
                                                 VIG ANR 12/04
                                                 RN04-02837P-Y10/04





                                      D-40

<PAGE>



                                   APPENDIX E

                      MORGAN STANLEY INVESTMENT MANAGEMENT
                       PROXY VOTING POLICY AND PROCEDURES

IV.      POLICY STATEMENT

         Introduction -- Morgan Stanley Investment Management's ("MSIM") policy
and procedures for voting proxies ("Proxy Voting Policy and Procedures") with
respect to securities held in the accounts of clients apply to those MSIM
entities that provide discretionary investment management services and for which
a MSIM entity has authority to vote proxies. The policies and procedures and
general guidelines in this section will be reviewed and updated, as necessary,
to address new or revised proxy voting issues. The MSIM entities covered by
these policies and procedures currently include the following: Morgan Stanley
Investment Advisors Inc., Morgan Stanley AIP GP LP, Morgan Stanley Investment
Management Inc., Morgan Stanley Investment Management Limited, Morgan Stanley
Investment Management Company, Morgan Stanley Asset & Investment Trust
Management Co., Limited, Morgan Stanley Investment Management Private Limited,
Morgan Stanley Hedge Fund Partners GP LP, Morgan Stanley Hedge Fund Partners LP,
Van Kampen Asset Management, and Van Kampen Advisors Inc. (each a "MSIM
Affiliate" and collectively referred to as the "MSIM Affiliates").

         Each MSIM Affiliate will use its best efforts to vote proxies as part
of its authority to manage, acquire and dispose of account assets. With respect
to the MSIM registered management investment companies (Van Kampen,
Institutional and Advisor Funds) (collectively referred to as the "MSIM Funds"),
each MSIM Affiliate will vote proxies pursuant to authority granted under its
applicable investment advisory agreement or, in the absence of such authority,
as authorized by the Boards of Directors or Trustees of the MSIM Funds. A MSIM
Affiliate will not vote proxies if the "named fiduciary" for an ERISA account
has reserved the authority for itself, or in the case of an account not governed
by ERISA, the Investment Management or Investment Advisory Agreement does not
authorize the MSIM Affiliate to vote proxies. MSIM Affiliates will, in a prudent
and diligent manner, vote proxies in the best interests of clients, including
beneficiaries of and participants in a client's benefit plan(s) for which the
MSIM Affiliates manage assets, consistent with the objective of maximizing
long-term investment returns ("Client Proxy Standard"). In certain situations, a
client or its fiduciary may provide a MSIM Affiliate with a proxy voting policy.
In these situations, the MSIM Affiliate will comply with the client's policy
unless to do so would be inconsistent with applicable laws or regulations or the
MSIM Affiliate's fiduciary responsibility.

         Proxy Research Services -- To assist the MSIM Affiliates in their
responsibility for voting proxies and the overall global proxy voting process,
Institutional Shareholder Services ("ISS") and the Investor Responsibility
Research Center ("IRRC") have been retained as experts in the proxy voting and
corporate governance area. ISS and IRRC are independent advisers that specialize
in providing a variety of fiduciary-level proxy-related services to
institutional investment managers, plan sponsors, custodians, consultants, and
other institutional investors. The services provided to MSIM Affiliates include
in-depth research, global issuer analysis, and voting recommendations. While the
MSIM Affiliates may review and utilize the ISS and IRRC recommendations in
making proxy voting decisions, they are in no way obligated to follow the ISS
and IRRC recommendations. In addition to research, ISS provides vote execution,
reporting, and recordkeeping. MSIM's Proxy Review Committee (see Section IV.A.
below) will carefully monitor and supervise the services provided by the proxy
research services.



                                       E-1
<PAGE>



         Voting Proxies for Certain Non-US Companies -- While the proxy voting
process is well established in the United States and other developed markets
with a number of tools and services available to assist an investment manager,
voting proxies of non-US companies located in certain jurisdictions,
particularly emerging markets, may involve a number of problems that may
restrict or prevent a MSIM Affiliate's ability to vote such proxies. These
problems include, but are not limited to: (i) proxy statements and ballots being
written in a language other than English; (ii) untimely and/or inadequate notice
of shareholder meetings; (iii) restrictions on the ability of holders outside
the issuer's jurisdiction of organization to exercise votes; (iv) requirements
to vote proxies in person, (v) the imposition of restrictions on the sale of the
securities for a period of time in proximity to the shareholder meeting; and
(vi) requirements to provide local agents with power of attorney to facilitate
the MSIM Affiliate's voting instructions. As a result, clients' non-U.S. proxies
will be voted on a best efforts basis only, after weighing the costs and
benefits of voting such proxies, consistent with the Client Proxy Standard. ISS
has been retained to provide assistance to the MSIM Affiliates in connection
with voting their clients' non-US proxies.

III.     GENERAL PROXY VOTING GUIDELINES

         To ensure consistency in voting proxies on behalf of its clients, MSIM
Affiliates will follow (subject to any exception set forth herein) these Proxy
Voting Policies and Procedures, including the guidelines set forth below. These
guidelines address a broad range of issues, including board size and
composition, executive compensation, anti-takeover proposals, capital structure
proposals and social responsibility issues and are meant to be general voting
parameters on issues that arise most frequently. The MSIM Affiliates, however,
may, pursuant to the procedures set forth in Section IV. below, vote in a manner
that is not in accordance with the following general guidelines, provided the
vote is approved by the Proxy Review Committee and is consistent with the Client
Proxy Standard.

VI.      GUIDELINES

         A.   MANAGEMENT PROPOSALS

              1.  When voting on routine ballot items, unless otherwise
                  determined by the Proxy Review Committee, the following
                  proposals will be voted in support of management.

                  o     Selection or ratification of auditors.

                  o     Approval of financial statements, director and auditor
                        reports.

                  o     General updating/corrective amendments to the chatter.

                  o     Approval of the payment of a dividend.

                  o     Proposals to limit Directors' liability and/or broaden
                        indemnification of Directors.

                  o     Proposals requiring that a certain percentage (up to
                        66%) of the company's Board members be independent
                        Directors.

                  o     Proposals requiring that members of the company's
                        compensation, nominating and audit committees be
                        comprised of independent or unaffiliated Directors.


                                       E-2
<PAGE>


                  o     Proposals recommending set retirement ages or requiring
                        specific levels of stock ownership by Directors.

                  o     Proposals to eliminate cumulative voting.

                  o     Proposals to eliminate preemptive rights.

                  o     Proposals for confidential voting and independent
                        tabulation of voting results.

                  o     Proposals related to the conduct of the annual meeting
                        except those proposals that relate to the "transaction
                        of such other business which may come before the
                        meeting."

              2.  Election of Directors. In situations where no conflict exists,
                  and where no specific governance deficiency has been noted,
                  unless otherwise determined by the Proxy Review Committee,
                  will be voted in support of nominees of management.

                        Unless otherwise determined by the Proxy Review
                  Committee, a withhold vote will be made where:

                        (i)     A nominee has, or any time during the previous
                                three years had, a relationship with the issuer
                                (e.g., investment banker, counsel or other
                                professional service provider, or familial
                                relationship with a senior officer of the
                                issuer) that may impair his or her independence;

                        (ii)    A direct conflict exists between the interests
                                of the nominee and the public shareholders; or

                        (iii)   Where the nominees standing for election have
                                not taken action to implement generally accepted
                                governance practices for which there is a
                                "bright line" test. These would include
                                elimination of dead hand or slow hand poison
                                pills, requiring Audit, Compensation or
                                Nominating Committees to be composed of
                                independent directors and requiring a majority
                                independent board.

              3.  The following non-routine proposals, which potentially may
                  have a substantive financial or best interest impact on a
                  shareholder, unless otherwise determined by the Proxy Review
                  Committee, will be voted in support of management.

                  CAPITALIZATION CHANGES

                  o     Proposals relating to capitalization changes that
                        eliminate other classes of stock and voting rights.

                  o     Proposals to increase the authorization of existing
                        classes of common stock (or securities convertible into
                        common stock) if. (i) a clear and legitimate business
                        purpose is stated; (ii) the number of shares requested




                                       E-3
<PAGE>


                        is reasonable in relation to the purpose for which
                        authorization is requested; and (iii) the authorization
                        does not exceed 100% of shares currently authorized and
                        at least 30% of the new authorization will be
                        outstanding.

                  o     Proposals to create a new class of preferred stock or
                        for issuances of preferred stock up to 50% of issued
                        capital.

                  o     Proposals for share repurchase plans.

                  o     Proposals to reduce the number of authorized shares of
                        common or preferred stock, or to eliminate classes of
                        preferred stock.

                  o     Proposals to effect stock splits.

                  o     Proposals to effect reverse stock splits if management
                        proportionately reduces the authorized share amount set
                        forth in the corporate charter. Reverse stock splits
                        that do not adjust proportionately to the authorized
                        share amount will generally be approved if the resulting
                        increase in authorized shares coincides with the proxy
                        guidelines set forth above for common stock increases.

                  COMPENSATION

                  o     Proposals relating to Director fees, provided the
                        amounts are not excessive relative to outer companies in
                        the country or industry.

                  o     Proposals for employee stock purchase plans that permit
                        discounts up to 15%, but only for grants that are part
                        of a broad based employee plan, including all
                        non-executive employees.

                  o     Proposals for the establishment of Employee Stock Option
                        Plans and other employee ownership plans.

                  ANTI-TAKEOVER MATTERS

                  o     Proposals to modify or rescind existing supermajority
                        vote requirements to amend the charters or bylaws.

                  o     Proposals relating to the adoption of anti-greenmail
                        provisions provided that the proposal: (i) defines
                        greenmail; (ii) prohibits buyback offers to large block
                        holders not made to all shareholders or not approved by
                        disinterested shareholders; and (iii) contains no
                        anti-takeover measures or other provisions restricting
                        the rights of shareholders.

              4.  The following non-routine proposals, which potentially may
                  have a substantive financial or best interest impact on the
                  shareholder, unless otherwise determined by the Proxy Review
                  Committee, will be voted against (notwithstanding management
                  support).



                                       E-4
<PAGE>

                  o     Proposals to establish cumulative voting rights in the
                        election of directors.

                  o     Proposals relating to capitalization changes that add
                        classes of stock which substantially dilute the voting
                        interests of existing shareholders.

                  o     Proposals to increase the authorized number of shares of
                        existing classes of stock that carry preemptive rights
                        or super-voting rights.

                  o     Proposals to create "blank check" preferred stock.

                  o     Proposals relating to changes in capitalization by 100%
                        or more.

                  o     Compensation proposals that allow for discounted stock
                        options that have not been offered to employees in
                        general.

                  o     Proposals to amend bylaws to require a supermajority
                        shareholder vote to pass or repeal certain provisions.

                  o     Proposals to indemnify auditors.

              5.  The following types of non-routine proposals, which
                  potentially may have a substantive financial or best interest
                  impact on an issuer, will be voted as determined by the Proxy
                  Review Committee.

                  CORPORATE TRANSACTIONS

                  o     Proposals relating to mergers, acquisitions and other
                        special corporate transactions (i.e., takeovers,
                        spin-offs, sales of assets, reorganizations,
                        restructurings and recapitalizations) will be examined
                        on a case-by-case basis. In all cases, ISS and IRRC
                        research and analysis will be used along with MSIM
                        Affiliates' research and analysis, including, among
                        other things, MSM internal company-specific knowledge.

                  o     Proposals relating to change-in-control provisions in
                        non-salary compensation plans, employment contracts, and
                        severance agreements that benefit management and would
                        be costly to shareholders if triggered.

                  o     Proposals relating to shareholders rights plans that
                        allow appropriate offers to shareholders to be blocked
                        by the board or trigger provisions that prevent
                        legitimate offers from proceeding.

                  o     Proposals relating to Executive/ Director stock option
                        plans. Generally, stock option plans should meet the
                        following criteria:

                        (i)     Whether the stock option plan is incentive
                                based;

                        (ii)    For mature companies, should be no more than 5%
                                of the issued capital at the time of approval;




                                       E-5
<PAGE>


                        (iii)   For growth companies, should be no more than 10%
                                of the issued capital at the time of approval.

                  ANTI-TAKEOVER PROVISIONS

                  o     Proposals requiring shareholder ratification of poison
                        pills.

                  o     Proposals relating to anti-takeover and related
                        provisions that serve to prevent the majority of
                        shareholders from exercising their rights or effectively
                        deter the appropriate tender offers and other offers.

         B.   SHAREHOLDER PROPOSALS

              1.  The following shareholder proposals will be supported, unless
                  otherwise determined by the Proxy Review Committee:

                  o     Proposals requiring auditors to attend the annual
                        meeting of shareholders.

                  o     Proposals requiring non-U.S. companies to have a
                        separate Chairman and CEO.

                  o     Proposals requiring that members of the company's
                        compensation, nominating and audit committees be
                        comprised of independent or unaffiliated Directors.

                  o     Proposals requiring that a certain percentage of the
                        company's members be comprised of independent and
                        unaffiliated Directors.

                  o     Proposals requiring confidential voting.

                  o     Proposals to reduce or eliminate of supermajority voting
                        requirements.

                  o     Proposals requiring shareholder approval for shareholder
                        rights plan or poison pill.

                  o     Proposals to require the company to expense stock
                        options.

              2.  The following shareholder proposals will be voted as
                  determined by the Proxy Review Committee.

                  o     Proposals that limit tenure of directors.

                  o     Proposals to limit golden parachutes.

                  o     Proposals requiring directors to own large amounts of
                        stock to be eligible for election.

                  o     Proposals that request or require disclosure of
                        executive compensation in addition to the disclosure
                        required by the Securities and Exchange Commission
                        ("SEC") regulations.



                                       E-6
<PAGE>


                  o     Proposals that limit retirement benefits or executive
                        compensation.

                  o     Proposals requiring shareholder approval for bylaw or
                        charter amendments.

                  o     Proposals requiring shareholder approval of executive
                        compensation.

                  o     Proposals requiring shareholder approval of golden
                        parachutes.

                  o     Proposals to eliminate certain anti-takeover related
                        provisions.

                  o     Proposals to prohibit payment of greenmail.

              3.  The following shareholder proposals will not be supported,
                  unless otherwise determined by the Proxy Review Committee.

                  o     Proposals to declassify the Board of Directors (if
                        management supports a classified board).

                  o     Proposals requiring a U.S. company to have a separate
                        Chairman and CEO.

                  o     Proposals requiring that the company prepare reports
                        that are costly to provide or that would require
                        duplicative efforts or expenditures that are of a
                        non-business nature or would provide no pertinent
                        information from the perspective of institutional
                        shareholders.

                  o     Proposals to add restrictions related to social,
                        political or special interest issues that impact the
                        ability of the company to do business or be competitive
                        and that have a significant financial or best interest
                        impact to the shareholders.

                  o     Proposals that require inappropriate endorsements or
                        corporate actions.

VII.     ADMINISTRATION OF PROXY POLICIES AND PROCEDURES

         A.   PROXY REVIEW COMMITTEE

              1.  The MSIM Proxy Review Committee ("Committee") is responsible
                  for creating and implementing MSIM's Proxy Voting Policy and
                  Procedures and, in this regard, has expressly adopted them.

                  (a)   The Committee, which is appointed by MSIM's Chief
                        Investment Officer ("CIO"), consists of senior
                        investment professionals who represent the different
                        investment disciplines and geographic locations of the
                        firm. The Committee is responsible for establishing
                        MSIM's proxy voting policy and guidelines and
                        determining how MSIM will vote proxies on an ongoing
                        basis.




                                       E-7
<PAGE>





                  (b)   The Committee will periodically review and have the
                        authority to amend, as necessary, these Proxy Voting
                        Policy and Procedures and establish and direct voting
                        positions consistent with the Client Proxy Standard.

                  (c)   The Committee will meet at least monthly to (among other
                        matters): (1) address any outstanding issues relating to
                        MSIM's Proxy Voting Policy and Procedures; and (2)
                        review proposals at upcoming shareholder meetings of
                        MSIM portfolio companies in accordance with this Policy
                        including, as appropriate, the voting results of prior
                        shareholder meetings of the same issuer where a similar
                        proposal was presented to shareholders. The Committee,
                        or its designee, will timely communicate to ISS MSIM's
                        Proxy Voting Policy and Procedures (and any amendments
                        to them and/or any additional guidelines or procedures
                        it may adopt).

                  (d)   The Committee will meet on an ad hoc basis to (among
                        other matters): (1) authorize "split voting" (i.e.,
                        allowing certain shares of the same issuer that are the
                        subject of the same proxy solicitation and held by one
                        or more MSIM portfolios to be voted differently than
                        other shares) and/or "override voting" (i.e., voting all
                        MSIM portfolio shares in a manner contrary to the Proxy
                        Voting Policy and Procedures); (2) review and approve
                        upcoming votes, as appropriate, for matters for which
                        specific direction has been provided in these Policy and
                        Procedures; and (3) determine how to vote matters for
                        which specific direction has not been provided in these
                        Policy and Procedures. Split votes will generally not be
                        approved within a single Global Investor Group team. The
                        Committee may take into account ISS and IRRC
                        recommendations and the research as well as any other
                        relevant information they may request or receive.

                  (e)   In addition to the procedures discussed above, if the
                        Committee determines that an issue raises a potential
                        material conflict of interest, or gives rise to the
                        appearance of a potential material conflict of interest,
                        the Committee will request a special committee to
                        review, and recommend a course of action with respect
                        to, the conflict(s) in question ("Special Committee").
                        The Special Committee shall be comprised of the Chairman
                        of the Proxy Review Committee, the Compliance Director
                        for the area of the firm involved or his/her designee, a
                        senior portfolio manager (if practicable, one who is a
                        member of the Proxy Review Committee) designated by the
                        Proxy Review Committee and MSIM's Chief Investment
                        Officer or his/her designee. The Special Committee may
                        request the assistance of MSIM's General Counsel or
                        his/her designee and will have sole discretion to cast a
                        vote. In addition to the research provided by ISS and
                        IRRC, the Special Committee may request analysis from
                        MSIM Affiliate investment professionals and outside
                        sources to the extent it deems appropriate.

                  (f)   The Committee and the Special Committee, or their
                        designee(s), will document in writing all of their
                        decisions and actions, which documentation will be
                        maintained by the Committee and the Special Committee,
                        or their designee(s), for a period of at least 6 years.
                        To the


                                       E-8
<PAGE>


                        extent these decisions relate to a security held by a
                        MSIM U.S. registered investment company, the Committee
                        and Special Committee, or their designee(s), will report
                        their decisions to each applicable Board of Trustees/
                        Directors of those investment companies at each Board's
                        next regularly scheduled Board meeting. The report will
                        contain information concerning decisions made by the
                        Committee and Special Committee during the most recently
                        ended calendar quarter immediately preceding the Board
                        meeting.

                  (g)   The Committee and Special Committee, or their
                        designee(s), will timely communicate to applicable
                        portfolio managers, the Compliance Departments and, as
                        necessary, ISS, decisions of the Committee and Special
                        Committee so that, among other things, ISS will vote
                        proxies consistent with their decisions.

         B.   IDENTIFICATION OF MATERIAL CONFLICTS OF INTEREST

              1.  If there is a possibility that a vote may involve a material
                  conflict of interest, the vote must be decided by the Special
                  Committee in consultation with MSIM's General Counsel or
                  his/her designee.

              2.  A material conflict of interest could exist in the following
                  situations, among others:

                  (a)   The issuer soliciting the vote is a client of MSIM or an
                        affiliate of MSIM and the vote is on a material matter
                        affecting the issuer;

                  (b)   The proxy relates to Morgan Stanley common stock or any
                        other security issued by Morgan Stanley or its
                        affiliates; or

                  (c)   Morgan Stanley has a material pecuniary interest in the
                        matter submitted for a vote (e.g., acting as a financial
                        advisor to a merger or acquisition for which Morgan
                        Stanley will be paid a success fee if completed).

         C.  PROXY VOTING REPORTS

              1.  MSIM will promptly provide a copy of these Policy and
                  Procedures to any client requesting it. MSIM will also, upon
                  client request, promptly provide a report indicating how each
                  proxy was voted with respect to securities held in that
                  client's account.

              2.  MSIM's legal department is responsible for filing an annual
                  Form N-PX on behalf of each registered management investment
                  company for which such filing is required, indicating how all
                  proxies were voted with respect to such investment company's
                  holdings.





                                       E-9


<PAGE>
                           PART C: OTHER INFORMATION


ITEM 15. INDEMNIFICATION

     Section 5.3 of the Registrant's Declaration of Trust, a copy of which is
filed as an exhibit hereto, provides for indemnification, as set forth below:

     "Section 5.3 Mandatory Indemnification.

          (a) Subject to the exceptions and limitations contained in paragraph
     (b) below:

               (i) every person who is or has been a Trustee or officer of the
          Trust shall be indemnified by the Trust to the fullest extent
          permitted by law against all liability and against all expenses
          reasonably incurred or paid by him in connection with any claim,
          action, suit or proceeding in which he becomes involved as a party or
          otherwise by virtue of his being or having been a Trustee or officer
          and against amounts paid or incurred by him in the settlement thereof;

               (ii) the words, "claim," "action," "suit," or "proceeding" shall
          apply to all claims, actions, suits or proceedings (civil, criminal,
          administrative or other, including appeals), actual or threatened; and
          the words "liability" and "expenses" shall include, without
          limitation, attorneys' fees, costs, judgments, amounts paid in
          settlement, fines, penalties and other liabilities.

          (b) No indemnification shall be provided hereunder to a Trustee or
     officer:

               (i) against any liability to the Trust or its Shareholders by
          reason of a final adjudication by the court or other body before which
          the proceeding was brought that he engaged in willful misfeasance, bad
          faith, gross negligence or reckless disregard of the duties involved
          in the conduct of his office;

               (ii) with respect to any matter as to which he shall have been
          finally adjudicated not to have acted in good faith in the reasonable
          belief that his action was in the best interest of the Trust;

               (iii) in the event of a settlement or other disposition not
          involving a final adjudication as provided in paragraph (b)(i) or
          (b)(ii) resulting in a payment by a Trustee or officer, unless there
          has been either a determination that such Trustee or officer did not
          engage in willful misfeasance, bad faith, gross negligence or reckless
          disregard of the duties involved in the conduct of his office by the
          court or other body approving the settlement or other disposition or a
          reasonable determination, based upon a review of readily available
          facts (as opposed to a full trial-type inquiry) that he did not engage


                                      C-1

<PAGE>
          in such conduct:

                    (A) by vote of a majority of the Disinterested Trustees
               acting on the matter (provided that a majority of the
               Disinterested Trustees then in office act on the matter); or

                    (B) by written opinion of independent legal counsel.

                    (C) The rights of indemnification herein provided by be
               insured against by policies maintained by the Trust, shall be
               severable, shall not effect any other rights to which any Trustee
               or officer may now or hereafter be entitled, shall continue as to
               a Person who has ceased to be such Trustee or officer and shall
               inure to the benefit of the heirs, executors, administrators, and
               assigns of such Person. Nothing contained herein shall affect any
               rights to indemnification to which personnel of the Trust other
               than Trustees and officers may be entitled by contract or
               otherwise under law.

                    (D) Expenses of preparation and presentation of a defense to
               any claim, action, suit, or proceeding of the character described
               in paragraph (a) of this Section 5.3 shall be advanced by the
               Trust prior to final disposition thereof upon receipt of an
               undertaking by or on behalf of the recipient to repay such amount
               if it is ultimately determined that he is not entitled to
               indemnification under this Section 5.3, provided that either

                         (i) such undertaking is secured by a surety bond or
                    some other appropriate security or the Trust shall be
                    insured against losses arising out of any such advances; or

                         (ii) a majority of the Disinterested Trustees acting on
                    the matter (provided that a majority of the Disinterested
                    Trustees then in office act on the matter) or an independent
                    legal counsel in a written opinion shall determine, based
                    upon a review of readily available facts (as opposed to a
                    full trial-type inquiry), that there is reason to believe
                    that the recipient ultimately will be found entitled to
                    indemnification.

     As used in this Section 5.3, a "Disinterested Trustee" is one (i) who is
not an "Interested Person" of the Trust (including anyone who has been exempted
from being an "Interested Person" by any rule, regulation or order of the
Commission), and (ii) against whom none of such actions, suits or other
proceedings or another action, suit or other proceeding on the same or similar
grounds is then or had been pending."

ITEM 16.  EXHIBITS

     1.   (a)  Declaration of Trust of the Registrant and amendments thereto +



                                      C-2
<PAGE>

       (b)     Form of Certificate of Vote Establishing Preferred Shares and
               Amendments thereto+++
  2.           Bylaws of the Registrant and amendment thereto+
  3.           Not applicable
  4.           Form of Agreement and Plan of Reorganization ++++
  5.   (a)     Specimen share certificate for common shares of the
               Registrant+
       (b)     Specimen share certificate for preferred shares of the
               Registrant+
  6.   (a)     Investment Advisory Agreement+
       (b)     Amendment to Investment Advisory Agreement+
  7.           Not Applicable
  8.   (a)     Form of Amended and Restated Deferred Compensation Agreement+
       (b)     Form of Retirement Plan for Each Closed End Fund+
  9.   (a)     Custodian Contract+
       (b)     Amendment of Custodian Contract+
  10.          Not Applicable
  11.          Opinion and consent of Skadden, Arps, Slate, Meagher & Flom LLP,
               counsel for the Registrant+
  12.          Tax opinion of Skadden, Arps, Slate, Meagher & Flom LLP+++++
  13.  (a)     Transfer Agency and Service Agreement+
       (b)     Auction Agency Agreement+
       (c)     Form of Broker-Dealer Agreement+
       (d)(i)  Letter of Representations+
          (ii) Form of Letter of Representations+
       (e)     Administration Agreement+
       (f)     Amended and Restated Legal Services Agreement+
       (g)     Fund Accounting Agreement and amendment thereto+
  14.          Consent of independent registered public accounting firm for the
               Registrant and for the Target Fund+
  15.          Not Applicable
  16.          Power of Attorney+
  17.  (a)     Code of Ethics of the Investment Adviser+
       (b)     Code of Ethics of the Funds+
  99.          Form of Proxy card for the Target Fund+


    + Filed herewith.
   ++ Incorporated by reference to Registrant's Registration Statement on Form
      N-14 as filed via EDGAR on March 18, 2005
  +++ Filed as Appendix B to the Statement of Additional Information and
      incorporated herein by reference to Registrant's Registration Statement
      on Form N-14 as filed via EDGAR on March 18, 2005
 ++++ Filed as Appendix A to the Statement of Additional Information and
      incorporated herein by reference to Registrant's Registration Statement
      on Form N-14 as filed via EDGAR on March 18, 2005
+++++ To be filed by further amendment


ITEM 17. UNDERTAKINGS

     (1) The undersigned Registrant agrees that prior to any public reoffering
of the securities registered through use of a prospectus which is part of this
Registration Statement by any person or party who is deemed to be an underwriter
within the meaning of Rule 145(c) of the Securities Act of 1933, as amended, the
reoffering prospectus will contain information called for by the applicable
registration form for reofferings by persons who may be deemed underwriters, in
addition to the information called for by other items of the applicable form.




                                      C-3
<PAGE>

     (2)  The undersigned Registrant agrees that every prospectus that is filed
under paragraph (1) above will be filed as part of an amendment to the
registration statement and will not be used until the amendment is effective,
and that, in determining any liability under the Securities Act of 1933, as
amended, each post-effective amendment shall be deemed to be a new registration
statement for the securities offered therein, and the offering of securities at
that time shall be deemed to be the initial bona fide offering of them.

     (3)  The undersigned Registrant agrees that, if the Reorganization
discussed in the registration statement close, it shall file by post-effective
amendment either a copy of the Internal Revenue Service private letter ruling
applied for or an opinion supporting the tax matters discussed in the
registration statement.




                                      C-4
<PAGE>

                                   SIGNATURES


      Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant has duly caused this amendment to the Registration Statement to
be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of New York and the State of New York, on May 5, 2005.


                                   VAN KAMPEN MUNICIPAL TRUST

                                   By: /s/ Lou Anne McInnis
                                       ------------------------------------
                                       Lou Anne McInnis
                                       Assistant Secretary


      Amendment to the Pursuant to the requirements of the Securities Act of
1933, as amended, this amendment to the Registration Statement has been signed
below by the following persons in the capacities and on the date indicated.


               SIGNATURES                               TITLE
               ----------                               -----

Principal Executive Officer:

          /s/ Ronald E. Robison*              Executive Vice President
- -------------------------------------------   and Principal Executive Officer
              Ronald E. Robison

Principal Financial Officer:

          /s/ James W. Garrett*
- -------------------------------------------   Chief Financial
              James W. Garrett                Officer and Treasurer


Trustees:

          /s/ David C. Arch*                  Trustee
- -------------------------------------------
              David C. Arch


          /s/ Jerry D. Choate*                Trustee
- -------------------------------------------
              Jerry D. Choate


          /s/ Rod Dammeyer*                   Trustee
- -------------------------------------------
              Rod Dammeyer



                                      C-5
<PAGE>


          /s/ Linda Hutton Heagy*             Trustee
- -------------------------------------------
              Linda Hutton Heagy

          /s/ R. Craig Kennedy*               Trustee
- -------------------------------------------
              R. Craig Kennedy

          /s/ Howard J Kerr*                  Trustee
- -------------------------------------------
              Howard J Kerr

          /s/ Mitchell M. Merin*              Trustee
- -------------------------------------------
              Mitchell M. Merin

          /s/ Jack E. Nelson*                 Trustee
- -------------------------------------------
              Jack E. Nelson

          /s/ Richard F. Powers, III*         Trustee
- -------------------------------------------
              Richard F. Powers, III

          /s/ Hugo F. Sonnenschein*           Trustee
- -------------------------------------------
              Hugo F. Sonnenschein

          /s/ Wayne W. Whalen*                Trustee
- -------------------------------------------
              Wayne W. Whalen

          /s/ Suzanne H. Woolsey*             Trustee
- -------------------------------------------
              Suzanne H. Woolsey


* Signed by Lou Anne McInnis pursuant to a power of attorney, filed herewith.



          /s/ Lou Anne McInnis               May 5, 2005
- -------------------------------------------
              Lou Anne McInnis
              Attorney-in-Fact







                                      C-6
<PAGE>


                       SCHEDULE OF EXHIBITS TO FORM N-14
                           VAN KAMPEN MUNICIPAL TRUST


Exhibit
- -------
 1. (a)     Declaration of Trust of the Registrant and amendments thereto
 2.         Bylaws of the Registrant and amendment thereto
 5. (a)     Specimen share certificate for common shares of the Registrant
    (b)     Specimen share certificate for preferred shares of the Registrant
 6. (a)     Investment Advisory Agreement
    (b)     Amendment to Investment Advisory Agreement
 8. (a)     Form of Amended and Restated Deferred Compensation Agreement
    (b)     Form of Retirement Plan for Each Closed End Fund
 9. (a)     Custodian Contract
    (b)     Amendment to Custodian Contract
11.         Opinion and consent of Skadden, Arps, Slate, Meagher & Flom LLP
13. (a)     Transfer Agency and Service Agreement
    (b)     Auction Agency Agreement
    (c)     Form of Broker-Dealer Agreement
    (d)(i)  Letter of Representations
       (ii) Form of Letter of Representations
    (e)     Administration Agreement
    (f)     Amended and Restated Legal Services Agreement
    (g)     Fund Accounting Agreement and amendment thereto
14.         Consent of independent registered public accounting firm for the
            Registrant and for the Target Fund
16.         Power of Attorney
17. (a)     Code of Ethics of the Investment Adviser
    (b)     Code of Ethics of the Funds
99.         Form of Proxy card for the Target Fund








</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(1)(A)
<SEQUENCE>2
<FILENAME>c93084a1exv99wx1yxay.txt
<DESCRIPTION>DECLARATION OF TRUST AND AMENDMENTS THERETO
<TEXT>
<PAGE>
                                                                    EXHIBIT 1(a)

                   AMENDED AND RESTATED DECLARATION OF TRUST

                                       OF

                       VAN KAMPEN MERRITT MUNICIPAL TRUST
             (formerly, Van Kampen Merritt Quality Municipal Trust)

                  DECLARATION OF TRUST made as of July 19, 1991, and as amended
and restated as of August 20, 1991 and September 17, 1991 by the undersigned
(together with all other persons from time to time duly elected, qualified and
serving as Trustees in accordance with the provisions of Article II hereof, the
"Trustees"), and by the holders of shares of beneficial interest to be issued
hereunder as hereinafter provided;

                  WHEREAS, the Trustees desire to establish a trust for the
investment and reinvestment of funds contributed thereto; and

                  WHEREAS, the Trustees desire that the beneficial interest in
the trust assets be divided into transferable shares of beneficial interest, as
hereinafter provided;

                  NOW, THEREFORE, the Trustees hereby declare that all money and
property contributed to the trust established hereunder shall be held and
managed in trust for the benefit of holders, from time to time, of the shares of
beneficial interest issued hereunder and subject to the provisions hereof.

                                   ARTICLE I

             NAME, PRINCIPAL OFFICE, RESIDENT AGENT AND DEFINITIONS

                  Section 1.1 Name, Principal Office and Resident Agent. The
name of the trust created hereby is the "Van Kampen Merritt Municipal Trust,"
(formerly, Van Kampen Merritt Quality Municipal Trust) (the "Trust").

                  The post office address of the principal office of the Trust
is 1001 Warrenville Road, Lisle, Illinois 60532. The name of the resident agent
of the Trust in the Commonwealth of Massachusetts is C T Corporation System, a
Delaware corporation, and the post office address of the resident agent is 2
Oliver Street, Boston, Massachusetts 02109.

                  Section 1.2 Definitions. Wherever they are used herein, the
following terms have the following respective meanings:

                       (a) "By-Laws" means the By-Laws referred to in Section
3.8 hereof, as from time to time amended.

                       (b) The terms "Commission," "Interested Person" and
"Majority Shareholder Vote" (the 67% or 50% requirement of the third sentence of
Section 2(a)(42) of the 1940 Act, whichever may be applicable) have the meanings
given them in the 1940 Act.



<PAGE>

                       (c) "Common Shareholder" means a record owner of
outstanding Common Shares.

                       (d) "Common Shares" means the common shares of beneficial
interest in the Trust as described in Section 6.1 hereof and includes fractions
of Common Shares as well as whole Common Shares.

                       (e) "Custodian" means any person other than the Trust who
has custody of any Trust Property as required by Section 17(f) of the 1940 Act,
but does not include a system for the central handling of securities described
in said Section 17(f).

                       (f) "Declaration" means this Declaration of Trust as
amended from time to time. Reference in this Declaration of Trust to
"Declaration," "hereof," "herein" and "hereunder" shall be deemed to refer to
this Declaration rather than the article or section in which such words appear.

                       (g) "Investment Adviser" means a party furnishing
services to the Trust pursuant to the contract described in Section 4.1 hereof.

                       (h) The "1940 Act" means the Investment Company Act of
1940 and the Rules and Regulations thereunder, as amended from time to time.

                       (i) "Person" means and includes individuals,
corporations, partnerships, trusts, associations, joint ventures and other
entities, whether or not legal entities, and governments and agencies and
political subdivisions thereof, whether domestic or foreign.

                       (j) "Preferred Shareholder" means a record owner of
outstanding Preferred Shares.

                       (k) "Preferred Shares" means the preferred shares of
beneficial interest in the Trust as described in Section 6.1 hereof and includes
fractions of Preferred Shares as well as whole Preferred Shares.

                       (l) "Shareholder" means a record owner of outstanding
Shares.


                       (m) "Shares" means the units of beneficial interest in
the Trust as described in Section 6.1 hereof and includes fractions of Shares as
well as whole Shares.

                       (n) "Transfer Agent" means a party furnishing services to
the Trust pursuant to the contract described in Section 4.3 hereof.

                       (o) The "Trust" means the trust created hereby.


                       (p) The "Trust Property" means any and all property, real
or personal, tangible or intangible, which is owned or held by or for the
account of the Trust or the Trustees.

                                       2

<PAGE>

                       (q) The "Trustees" means the persons who have signed the
Declaration, so long as they shall continue in office in accordance with the
terms hereto, and all other persons who may from time to time be duly elected,
qualified and serving as Trustees in accordance with the provisions hereof, and
references herein to a Trustee or the Trustees shall refer to such person or
persons in their capacity as trustees hereunder.

                       (r) "Underwriters" means the parties, other than the
Trust, to the contract described in Section 4.2 hereof.

                                   ARTICLE II

                                    TRUSTEES

                  Section 2.1 Number of Trustees. The number of Trustees shall
initially be three (3), and after a registration statement under the Securities
Act of 1933, as amended, covering the first public offering of securities of the
Trust shall have been filed, the number of Trustees shall be such number as
shall be fixed from time to time by a written instrument signed by a majority of
the Trustees, provided, however, that, following the date such registration
statement shall have become effective (the "effective date"), the number of
Trustees shall in no event be less than three (3) nor more than eleven (11),
except as such number shall be increased in connection with the rights of the
holders of the Preferred Shares to elect a majority of the Trustees, as provided
for in Section 2.2 hereof. No reduction in the number of Trustees shall have the
effect of removing any Trustee from office prior to the expiration of his term
unless the Trustee is specifically removed pursuant to Section 2.2 of this
Article II at the time of the decrease.

                  Section 2.2 Term of Office of Trustees. The Board of Trustees
shall be divided into three classes. The number of Trustees in each class shall
be as nearly equal as practicable, as determined from time to time by resolution
of the Board of Trustees. The term of office of the first class shall expire on
the date of the first annual meeting of Shareholders or special meeting in lieu
thereof following the effective date. The term of office of the second class
shall expire on the date of the second annual meeting of Shareholders or special
meeting in lieu thereof. The term of office of the third class shall expire on
the date of the third annual meeting of Shareholders or special meeting in lieu
thereof. Upon expiration of the term of office of each class as set forth above,
the number of Trustees in such class, as determined by the Board of Trustees,
shall be elected for a term expiring on the date of the third annual meeting of
Shareholders or special meeting in lieu thereof following such expiration to
succeed the Trustees whose terms in office expire. Subject to the rights of the
Preferred Shareholders, the Trustees shall be elected by the Common Shareholders
owning of record a plurality of the Common Shares voting as a class at an annual
meeting of the Shareholders or special meeting in lieu thereof called for that
purpose, except as provided in Section 2.3 of this Article; provided, however,
that the Preferred Shareholders owning of record a plurality of the Preferred
Shares voting as a class at an annual meeting of the Shareholders or special
meeting in lieu thereof called for such purpose, shall elect at least two (2)
Trustees at all times, and, provided further, that the Preferred Shareholders
owning of record a plurality of the Preferred Shares voting as a class shall
elect at least a majority of

                                       3

<PAGE>

the Trustees, which number of Trustees shall be increased appropriately in order
to effectuate such rights after giving effect to resignations of Trustees, if
(i) at any time the dividends on the Preferred Shares shall be unpaid in an
amount equal to two (2) full years dividends on the Preferred Shares, with such
representation to continue until all dividends in arrears shall have been paid
or otherwise provided for, or (ii) pursuant to the designations and powers,
preferences and rights, and the qualifications, limitations and restrictions of
the Preferred Shares as determined in accordance with Section 6.1 hereof. Each
Trustee elected shall hold office until his successor shall have been elected
and shall have qualified; except that (a) any Trustee may resign his trust
(without need for prior or subsequent accounting) by an instrument in writing
signed by him and delivered to the other Trustees, which shall take effect upon
such delivery or upon such later date as is specified therein; (b) any Trustee
may be removed (provided the aggregate number of Trustees after such removal
shall not be less than the number required by Section 2.1 hereof) with cause, at
any time by written instrument, signed by at least two-thirds of the remaining
Trustees, specifying the date when such removal shall become effective
(provided, however, that the Trustees elected by any one class of shares shall
have no power to so remove any Trustees elected by another class of Shares); (c)
any Trustee who requests in writing to be retired or who has become
incapacitated by illness or injury may be retried by written instrument signed
by a majority of the other Trustees, specifying the date of his retirement; and
(d) any Trustee may be removed at any meeting of Shareholders by a vote of
two-thirds of the outstanding shares of the class or classes of shares of
beneficial interest that elected such Trustee. Upon the resignation or removal
of a Trustee, or his otherwise ceasing to be a Trustee, he shall execute and
deliver such documents as the remaining Trustees shall require for the purpose
of conveying to the Trust or the remaining Trustees any Trust property held in
the name of the resigning or removed Trustee. Upon the incapacity or death of
any Trustee, his legal representative shall execute and deliver on his behalf
such documents as the remaining Trustees shall require as provided in the
preceding sentence.

                  Section 2.3 Resignation and Appointment of Trustees. The term
of office of a Trustee shall terminate and a vacancy shall occur in the event of
the death, declination, resignation, removal, retirement, bankruptcy,
adjudicated incompetence or other incapacity to perform the duties of the office
of a Trustee. In the case of an existing vacancy, including a vacancy existing
by reason of an increase in the number of Trustees, the remaining Trustees shall
fill such vacancy by appointing such other person as they in their discretion
shall see fit. Such appointment shall be evidenced by a written instrument
signed by a majority of the Trustees then in office. Any such appointment shall
not become effective, however, until the person named in the written instrument
of appointment shall have accepted in writing such appointment and agreed in
writing to be bound by the terms of this Declaration. An appointment of a
Trustee may be made by the Trustees then in office and notice thereof mailed to
Shareholders as aforesaid in anticipation of a vacancy to occur by reason of
retirement, resignation or increase in number of Trustees effective at a later
date, provided that said appointment shall become effective only at or after the
effective date of said retirement, resignation or increase in number of
Trustees. The power of appointment is subject to the provisions of Section 16(a)
of the 1940 Act.

                                       4

<PAGE>

                  Section 2.4 Vacancies. The death, declination, resignation,
retirement, removal, bankruptcy, adjudicated incompetence or incapacity to
perform the duties of a Trustee, or any one of them, shall not operate to annul
the Trust or to revoke any existing agency created pursuant to the terms of this
Declaration. Whenever a vacancy in the number of Trustees shall occur, until
such vacancy is filled as provided in Section 2.3, the Trustees in office,
regardless of their number, shall have all the powers granted to the Trustees
and shall discharge all the duties imposed upon the Trustees by the Declaration,
subject to the rights of the holders of the Preferred Shares to elect a Trustee
to fill such vacancy in accordance with the terms and provisions hereof. A
written instrument certifying the existence of such vacancy signed by a majority
of the Trustees shall be conclusive evidence of the existence of such vacancy.

                  Section 2.5 Delegation of Power to Other Trustees. Any Trustee
may, by power of attorney, delegate his power for a period not exceeding six (6)
months at any one time to any other Trustee or Trustees; provided that in no
case shall less than two (2) Trustees personally exercise the powers granted to
the Trustees under this Declaration except as herein otherwise expressly
provided. Nothing in this section 2.5 shall apply to, or limit the ability of
any Trustee to grant, any power of attorney for the purpose of executing any
registration statement filed with the Commission, or amendment thereto, relating
to Shares.

                  Section 2.6 Meetings. Meetings of the Trustees shall be held
from time to time upon the call of the Chairman, if any, the President, the
Secretary or any two Trustees. Regular meetings of the Trustees may be held
without call or notice at a time and place fixed by the By-Laws or by resolution
of the Trustees. Notice of any other meeting shall be mailed not less than 48
hours before the meeting or otherwise actually delivered orally or in writing
not less than 24 hours before the meeting, but may be waived in writing by any
Trustee either before or after such meeting. The attendance of a Trustee at a
meeting shall constitute a waiver of notice of such meeting except where a
Trustee attends a meeting for the express purpose of objecting to the
transaction of any business on the ground that the meeting has not been lawfully
called or convened. The Trustees may act with or without a meeting. A quorum for
all meetings of the Trustees shall be a majority of the Trustees. Unless
provided otherwise in this Declaration of Trust, any action of the Trustees may
be taken at a meeting by vote of a majority of the Trustees present (a quorum
being present) or without a meeting by written consent of a majority of the
Trustees.

                  Any committee of the Trustees, including an executive
committee, if any, may act with or without a meeting. A quorum for all meetings
of any such committee shall be a majority of the members thereof. Unless
provided otherwise in this Declaration, any action of any such committee may be
taken at a meeting by vote of a majority of the members present (a quorum being
present) or without a meeting by written consent of a majority of the members.

                  With respect to actions of the Trustees and any committee of
the Trustees, Trustees who are Interested Persons in any action to be taken may
be counted for quorum

                                       5

<PAGE>

purposes under this Section and shall be entitled to vote to the extent not
prohibited by the 1940 Act.

                  Section 2.7 Officers. The Trustees shall annually elect a
President, a Secretary and a Treasurer and may elect a Chairman. The Trustees
may elect or appoint or may authorize the Chairman, if any, or President to
appoint such other officers or agents with such powers as the Trustees may deem
to be advisable. A Chairman shall, and the President, Secretary and Treasurer
may, but need not, be a Trustee.

                                  ARTICLE III

                               POWERS OF TRUSTEES

                  Section 3.1 General. The Trustees shall have exclusive and
absolute control over the Trust Property and over the business of the Trust to
the same extent as if the Trustees were the sole owners of the Trust Property
and business in their own right, but with such powers of delegation as may be
permitted by the Declaration. The Trustees shall have power to conduct the
business of its branches and maintain offices both within and without the
Commonwealth of Massachusetts, in any and all states of the United States of
America, in the District of Columbia, and in any and all commonwealths,
territories, dependencies, colonies, possessions, agencies or instrumentalities
of the United States of America and of foreign governments and to do all such
other things and execute all such instruments as the Trustees deem necessary,
proper or desirable in order to promote the interests of the Trust although such
things are not herein specifically mentioned. Any determination as to what is in
the interests of the Trust made by the Trustees in good faith shall be
conclusive. In construing the provisions of the Declaration, the presumption
shall be in favor of a grant of power to the Trustees.

                  The enumeration of any specific power herein shall not be
construed as limiting the aforesaid power. Such powers of the Trustees may be
exercised without order of or resort to any court.

                  Section 3.2 Investments. (a) The Trustees shall have the power
to:

                              (i) operate as and carry on the business of an
         investment company, and exercise all of the powers necessary or
         appropriate to the conduct of such operations;

                              (ii) To subscribe for, invest in, hold for
         investment, or reinvest in, securities, including common and preferred
         stocks; warrants; bonds, debentures, bills, time notes and all other
         evidences of indebtedness; negotiable or non-negotiable instruments;
         government securities, including securities of any state, municipality
         or other political subdivision thereof, or any governmental or
         quasigovernmental agency or instrumentality; and money market
         instruments including bank certificates of deposit, finance paper,
         commercial paper, bankers acceptances and all kinds of repurchase
         agreements, of any corporation, company, trust, association, firm or
         other business organization however established, and of

                                       6

<PAGE>


         any country, state, municipality or other political subdivision, or any
         governmental or quasi-governmental agency or instrumentality;

                              (iii) To acquire (by purchase, subscription or
         otherwise), to hold, to trade in and deal in, to acquire any rights or
         options to purchase or sell, to sell or otherwise dispose of, to lend,
         to write (or sell) and purchase put and call options on any such
         securities and to pledge any such securities and repurchase agreements;

                              (iv) To exercise all rights, powers and privileges
         of ownership or interest in all securities and repurchase agreements
         included in the Trust Property, including the right to vote thereon and
         otherwise act with respect thereto and to do all acts for the
         preservation, protection, improvement and enhancement in value of all
         such securities and repurchase agreements;

                              (v) To acquire (by purchase, lease or otherwise)
         and to hold, use, maintain, develop and dispose of (by sale or
         otherwise) any property, real or personal, including futures contracts
         and options thereon, cash, and any interest therein;

                              (vi) To borrow money or otherwise obtain credit
         and in this connection issue notes or other evidence of indebtedness;
         to secure borrowings by mortgaging, pledging or otherwise subjecting as
         security the Trust Property; to endorse, guarantee, or undertake the
         performance of any obligation, contract or engagement of any other
         Person and to lend Trust Property;

                              (vii) To aid by further investment any
         corporation, company, trust, association or firm, any obligation of or
         interest in which is included in the Trust Property or in the affairs
         of which the Trustees have any direct or indirect interest; to do all
         acts and things designed to protect, preserve, improve or enhance the
         value of such obligation or interest; to guarantee or become surety on
         any or all other contracts, stocks, bonds, notes, debentures and other
         obligations of any such corporation, company, trust, association or
         firm; and

                              (viii) to carry on any other business in
         connection with or incidental to any of the foregoing powers, to do
         everything necessary, suitable or proper for the accomplishment of any
         purpose or the attainment of any object or the furtherance of any power
         hereinbefore set forth, and to do every other act or thing incidental
         or appurtenant to or connected with the aforesaid purposes, objects or
         powers.

                  The foregoing clauses shall be construed both as objects and
powers, and the foregoing enumeration of specific powers shall not be held to
limit or restrict in any manner the general powers of the Trustees.

                       (b) The Trustees shall not be limited to investing in
obligations maturing before the possible termination of the Trust, nor shall the
Trustees be limited by any law limiting the investments which may be made by
fiduciaries.

                                       7

<PAGE>


                  Section 3.3 Legal Title. Legal title to all the Trust Property
shall be vested in the Trustees as joint tenants except that the Trustees shall
have power to cause legal title to any Trust Property to be held by or in the
name of one or more of the Trustees, or in the name of the Trust, or in the name
of any other Person as nominee, on such terms as the Trustees may determine. The
right, title and interest of the Trustees in the Trust Property shall vest
automatically in each Person who may hereafter become a Trustee. Upon the
termination of the term of office, resignation, removal or death of a Trustee he
shall automatically cease to have any right, title or interest in any of the
Trust Property, and the right, title and interest of such Trustee in the Trust
Property shall vest automatically in the remaining Trustees. Such vesting and
cessation of title shall be effective whether or not conveyancing documents have
been executed and delivered.

                  Section 3.4 Issuance and Purchase of Securities. The Trustees
shall have the power to issue, sell, purchase, redeem, retire, cancel, acquire,
hold, resell, reissue, dispose of, transfer, and otherwise deal in Shares and
subject to the provisions set forth in Articles VI, VII and VIII hereof, to
apply to any such repurchase, retirement, cancellation or acquisition of Common
Shares or Preferred Shares any funds or property of the Trust whether capital or
surplus or otherwise, to the full extent now or hereafter permitted by the laws
of the Commonwealth of Massachusetts governing business corporations.

                  Section 3.5 Delegation; Committees. The Trustees shall have
power to delegate from time to time to such of their number or to officers,
employees or agents of the Trust the doing of such things and the execution of
such instruments either in the name of the Trust or the names of the Trustees or
otherwise as the Trustees may deem expedient, to the same extent as such
delegation is not prohibited by the 1940 Act.

                  Section 3.6 Collection and Payment. The Trustees shall have
power to collect all property due to the Trust; to pay all claims, including
taxes, against the Trust Property; to prosecute, defend, compromise or abandon
any claims relating to the Trust Property; to foreclose any security interest
securing any obligations by virtue of which any property is owed to the Trust;
and to enter into releases, agreements and other instruments.

                  Section 3.7 Expenses. The Trustees shall have the power to
incur and pay any expenses which in the opinion of the Trustees are necessary or
incidental to carry out any of the purposes of the Declaration, and to pay
reasonable compensation from the funds of the Trust to themselves as Trustees.
The Trustees shall fix the compensation of all officers, employees and Trustees.

                  Section 3.8 Manner of Acting; By-Laws. Except as otherwise
provided herein or in the By-laws, any action to be taken by the Trustees may be
taken by a majority of the Trustees present at a meeting of Trustees (a quorum
being present), including any meeting held by means of a conference telephone
circuit or similar communications equipment by means of which all persons
participating in the meeting can hear each other, or by written consents of all
the Trustees. The Trustees may adopt By-laws to the extent such power is not
reserved to the Shareholders.


                                       8

<PAGE>

                  Notwithstanding the foregoing provisions of this Section 3.8
and in addition to such provisions or any other provision of this Declaration or
of the By-laws, the Trustees may by resolution appoint a committee consisting of
less than the whole number of Trustees then in office, which committee may be
empowered to act for and bind the Trustees and the Trust, as if the acts of such
committee were the acts of all the Trustees then in office, with respect to the
institution, prosecution, dismissal, settlement, review or investigation of any
action, suit or proceeding which shall be pending or threatened to be brought
before any court, administrative agency or other adjudicatory body.

                  Section 3.9 Miscellaneous Powers. The Trustees shall have the
power to: (a) employ or contract with such Persons as the Trustees may deem
desirable for the transaction of the business of the Trust; (b) enter into joint
ventures, partnerships and any other combinations or associations; (c) remove
Trustees or fill vacancies in or add to their number, elect and remove such
officers and appoint and terminate such agents or employees as they consider
appropriate, and appoint from their own number, and terminate, any one or more
committees which may exercise some or all of the power and authority of the
Trustees as the Trustees may determine; (d) purchase, and pay for out of Trust
Property, insurance policies insuring the Common Shareholders and Preferred
Shareholders, Trustees, officers, employees, agents, investment advisers,
distributors, selected dealers or independent contractors of the Trust against
all claims arising by reason of holding any such position or by reason of any
action taken or omitted by any such Person in such capacity, whether or not
constituting negligence, or whether or not the Trust would have the power to
indemnify such Person against such liability; (e) establish pension, profit
sharing, Share purchase and other retirement, incentive and benefit plans for
any Trustees, officers, employees or agents of the Trust; (f) make donations,
irrespective of benefit to the Trust, for charitable, religious, educational,
scientific, civil or similar purposes; (g) to the extent permitted by law,
indemnify any person with whom the Trust has dealings, including the Investment
Adviser, Underwriter, Transfer Agent, Custodian and selected dealers to such
extent as the Trustees shall determine; (h) guarantee indebtedness or
contractual obligations of others; (i) determine and change the fiscal year of
the Trust and the method by which its accounts shall be kept; and (j) adopt a
seal for the Trust but the absence of such seal shall not impair the validity of
any instrument executed on behalf of the Trust.

                  Section 3.10 Principal Transactions. Except in transactions
permitted by the 1940 Act or rules and regulations adopted by the Commission, or
any order of exemption issued by the Commission, the Trustees shall not, on
behalf of the Trust, buy any securities (other than Common or Preferred Shares)
from or sell any securities (other than Common or Preferred Shares) to, or lend
any assets of the Trust to, any Trustee or officer of the Trust or any firm of
which any such Trustee or officer is a member acting as principal, or have any
such dealings with the Investment Adviser, Underwriter or Transfer Agent or with
any Interested Person, or firm or company in which such Person is an Interested
Person, as broker, legal counsel, registrar, transfer agent, dividend disbursing
agent or custodian.


                                       9

<PAGE>

                                   ARTICLE IV

               INVESTMENT ADVISER, UNDERWRITER AND TRANSFER AGENT

                  Section 4.1 Investment Adviser. Subject to a Majority
Shareholder Vote of both the Common Shareholders and the Preferred Shareholders
voting without regard to class, the Trustees may in their discretion from time
to time enter into one or more investment advisory or management contracts
whereby a party to such a contract shall undertake to furnish the Trust such
administrative, management, investment advisory, statistical and research
facilities and services, and such other facilities and services, if any, as the
Trustees shall from time to time consider desirable and all upon such terms and
conditions as the Trustees may in their discretion determine. Notwithstanding
any provisions of this Declaration, the Trustees may delegate to the Investment
Adviser authority (subject to such general or specific instructions as the
Trustees may from time to time adopt) to effect purchases, sales, loans or
exchanges of assets of the Trust on behalf of the Trustees or may authorize any
officer, employee or Trustee to effect such purchases, sales, loan or exchanges
pursuant to recommendations of the Investment Adviser (and all without further
action by the Trustees). Any such purchases, sales, loans and exchanges shall be
deemed to have been authorized by all of the Trustees.

                  Section 4.2 Underwriter. The Trustees may in their discretion
enter into a contract providing for the sale of shares of beneficial interest of
the Trust whereby the Trust may either agree to sell such Shares to the other
parties to the contact or appoint such other party the underwriter for such
Shares. The contract shall be on such terms and conditions as the Trustees may
in their discretion determine not inconsistent with the provisions of this
Article IV or the By-laws; and such contract may also provide for the sale of
Shares by such other parties as principal or as agent of the Trust and may
provide that such other party may enter into agreements with registered
securities dealers to further the purpose of the distribution of such Shares.

                  Section 4.3 Transfer Agent. The Trustees may in their
discretion from time to time enter into a transfer agency and Shareholder
service contract whereby the other party to such contract shall undertake to
furnish transfer agency and Shareholder services to the Trust. The contract
shall have such terms and conditions as the Trustees may in their discretion
determine not inconsistent with the Declaration or the By-laws. Such services
may be provided by one or more Persons.

                  Section 4.4 Parties to Contract. Any contract of the character
described in Section 4.1, 4.2 or 4.3 of this Article IV or any Custodian
contract, as described in the By-laws, may be entered into with any Person,
although one or more of the Trustees or officers of the Trust may be an officer,
partner, director, trustee, Shareholder, or member of such other party to the
contract, and no such contract shall be invalidated or rendered voidable by
reason of the existence of any such relationship; nor shall any Person holding
such relationship be disqualified from voting upon or executing any such
contract; nor shall any Person holding such relationship be liable merely by
reason of such relationship for any loss or expense to the Trust under or by
reason of said

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<PAGE>


contract or accountable for any profit realized directly or indirectly
therefrom, provided that the contract when entered into was not inconsistent
with the provisions of this Article IV or the By-laws. The same Person may be
the other party to contracts entered into pursuant to Sections 4.1, 4.2 and 4.3
above or custodian contracts, and any individual may be financially interested
or otherwise affiliated with Persons who are parties to any or all of the
contracts mentioned in this Section 4.4.

                  Section 4.5 Compliance with 1940 Act. Any contract entered
into pursuant to Sections 4.1 and 4.2 shall be consistent with and subject to
the requirements of Section 15 of the Investment Company Act of 1940 (including
any amendment thereof or other applicable Act of Congress hereafter enacted)
with respect to its continuance in effect, its termination and the method of
authorization and approval of such contract or renewal thereof.

                                   ARTICLE V

                    LIMITATIONS OF LIABILITY OF SHAREHOLDERS,
                               TRUSTEES AND OTHERS

                  Section 5.1 No Personal Liability of Shareholders, Trustees,
etc. No Shareholder of the Trust shall be subject to any personal liability
whatsoever to any Person in connection with Trust Property or the acts,
obligations or affairs of the Trust. No Trustee, officer, employee or agent of
the Trust shall be subject to any personal liability whatsoever to any Person,
other than the Trust or its Shareholders, in connection with Trust Property or
the affairs of the Trust, save only that arising from bad faith, willful
misfeasance, gross negligence or reckless disregard for his duty to such Person;
and all such Persons shall look solely to the Trust Property for satisfaction of
claims of any nature arising in connection with the affairs of the Trust. If any
Shareholder, Trustee, officer, employee, or agent, as such, of the Trust, is
made a party to any suit or proceeding to enforce any such liability, he shall
not, on account thereof, be held to any personal liability. The Trust shall
indemnify and hold each Shareholder harmless from and against all claims and
liabilities to which such Shareholder may become subject by reason of his being
or having been a Shareholder, and shall reimburse such Shareholder for all legal
and other expenses reasonably incurred by him in connection with any such claim
or liability. The rights accruing to a Shareholder under this Section 5.1 shall
not exclude any other right to which such Shareholder may be lawfully entitled,
nor shall anything herein contained restrict the right of the Trust to indemnify
or reimburse a Shareholder in any appropriate situation even though not
specifically provided herein.

                  Section 5.2 Non-Liability of Trustees, etc. Subject to Section
5.3 (b) below, no Trustee, officer, employee or agent of the Trust shall be
liable to the Trust, its Shareholders, or to any Shareholder, Trustee, officer,
employee or agent thereof for any action or failure to act (including without
limitation the failure to compel in any way a former or acting Trustee to
redress any breach of trust) except for his own bad faith, willful misfeasance,
gross negligence or reckless disregard of his duties involved in the conduct of
his office.


                                       11

<PAGE>

                  Section 5.3 Mandatory Indemnification. (a) Subject to the
exceptions an limitations contained in paragraph (b) below:

                              (i) every person who is or has been a Trustee or
         officer of the Trust shall be indemnified by the Trust to the fullest
         extent permitted by law against all liability and against all expenses
         reasonably incurred or paid by him in connection with any claim,
         action, suit or proceeding in which he becomes involved as a party or
         otherwise by virtue of his being or having been a Trustee or officer
         and against amounts paid or incurred by him in the settlement thereof;

                              (ii) the words "claim," "action," "suit," or
         "proceeding shall apply to all claims, actions, suits or proceedings
         (civil, criminal, administrative or other, including appeals), actual
         or threatened; and the words "liability" and "expenses" shall include,
         without limitation, attorneys' fees, costs, judgments, amounts paid in
         settlement, fines, penalties and other liabilities.

                       (b) No indemnification shall be provided hereunder to a
Trustee or officer:

                              (i) against any liability to the Trust or its
         Shareholders by reason of a final adjudication by the court or other
         body before which the proceeding was brought that he engaged in willful
         misfeasance, bad faith, gross negligence or reckless disregard of the
         duties involved in the conduct of his office;

                              (ii) with respect to any matter as to which he
         shall have been finally adjudicated not to have acted in good faith in
         the reasonable belief that his action was in the best interest of the
         Trust;

                              (iii) in the event of a settlement or other
         disposition not involving a final adjudication as provided in paragraph
         (b)(i) or (b)(ii) resulting in a payment by a Trustee or officer,
         unless there has been either a determination that such Trustee or
         officer did not engage in willful misfeasance, bad faith, gross
         negligence or reckless disregard of the duties involved in the conduct
         of his officer by the court or other body approving the settlement or
         other disposition or a reasonable determination, based upon a review of
         readily available facts (as opposed to a full trial-type inquiry) that
         he did not engage in such conduct:

                                       (A) by vote of a majority of the
                           Disinterested Trustees acting on the matter (provided
                           that a majority of the Disinterested Trustees then in
                           office act on the matter); or

                                       (B) by written opinion of independent
                           legal counsel.

                       (c) The rights of indemnification herein provided may be
insured against by policies maintained by the Trust, shall be severable, shall
not affect any other rights to which any Trustee or officer may now or hereafter
be entitled, shall continue as

                                       12

<PAGE>

to a Person who has ceased to be such Trustee or officer and shall inure to the
benefit of the heirs, executors, administrators, and assigns of such Person.
Nothing contained herein shall affect any rights to indemnification to which
personnel of the Trust other than Trustees and officers may be entitled by
contract or otherwise under law.

                       (d) Expenses of preparation and presentation of a defense
to any claim, action, suit, or proceeding of the character described in
paragraph (a) of this Section 5.3 shall be advanced by the Trust prior to final
disposition thereof upon receipt of an undertaking by or on behalf of the
recipient to repay such amount if it is ultimately determined that he is not
entitled to indemnification under this Section 5.3, provided that either

                              (i) such undertaking is secured by a surety bond
         or some other appropriate security or the Trust shall be insured
         against losses arising out of any such advances; or

                              (ii) a majority of the Disinterested Trustees
         acting on the matter (provided that a majority of the Disinterested
         Trustees then in office act on the matter) or an independent legal
         counsel in a written opinion shall determine, based upon a review of
         readily available facts (as opposed to a full trial-type inquiry), that
         there is reason to believe that the recipient ultimately will be found
         entitled to indemnification.

                  As used in this section 5.3, a "Disinterested Trustee" is one
(i) who is not an "Interested Person" of the Trust (including anyone who has
been exempted from being an "Interested Person" by any rule, regulation or order
of the Commission), and (ii) against whom none of such actions, suits or other
proceedings or another action, suit or other proceeding on the same or similar
grounds is then or had been pending.

                  Section 5.4 No Bond Required of Trustees. No Trustee shall be
obligated to give any bond or other security for the performance of any of his
duties hereunder.

                  Section 5.5 No Duty of Investigation; Notice in Trust
Instruments, etc. No purchaser, lender, transfer agent or other Person dealing
with the Trustee or any officer, employee or agent of the Trust shall be bound
to make any inquiry concerning the validity of any transaction purporting to be
made by the Trustee or by said officer, employee or agent or be liable for the
application of money or property paid, loaned or delivered to or on the order of
the Trustees or of said officer, employee or agent. Every obligation, contract,
instrument, certificate, Common Share or Preferred Share, other security of the
Trust or undertaking, and every other act or thing whatsoever executed in
connection with the Trust shall be conclusively presumed to have been executed
or done by the executors thereof only in their capacity as Trustees under the
Declaration or in their capacity as officers, employees or agents of the Trust.
Every written obligation, contract, instrument, certificate, Common Share or
Preferred Share, other security of the Trust or undertaking made or issued by
the Trustees shall recite that the same is executed or made by them not
individually, but as Trustees under the Declaration, and that the

                                       13

<PAGE>



obligations of the Trust under any such instrument are not binding upon any of
the Trustees or Shareholders, individually, but bind only the trust estate, and
may contain any further recital which they or he may deem appropriate, but the
omission of such recital shall not operate to bind the Trustees or Shareholders
individually. The Trustees shall seek diligently at all times to maintain
insurance for the protection of the Trust Property, its Shareholders, Trustees,
officers, employees and agents in such amount as the Trustees shall deem
adequate to cover possible tort liability, and such other insurance as the
Trustees in their sole judgment shall deem advisable.

                  Section 5.6 Reliance on Experts, etc. Each Trustee and officer
or employee of the Trust shall, in the performance of his duties, be fully and
completely justified and protected with regard to any act or any failure to act
resulting from reliance in good faith upon the books of account or other records
of the Trust, upon an opinion of counsel, or upon reports made to the Trust by
any of its officers or employees or by the Investment Adviser, the Distributor,
Transfer Agent, selected dealers, accountants, appraisers or other experts or
consultants selected with reasonable care by the Trustees, officers or employees
of the Trust, regardless of whether such counsel or expert may also be a
Trustee.

                                   ARTICLE VI

                          SHARES OF BENEFICIAL INTEREST

                  Section 6.1 Beneficial Interest. The interest of the
beneficiaries hereunder shall be divided into transferable shares of beneficial
interest with par value of $.01 per share (the "Shares"). The Board of Trustees
of the Trust may authorize separate classes of shares together with such
designations and powers, preferences and rights, qualifications, limitations and
restrictions as may be determined from time to time by the Board of Trustees.
The number of shares of beneficial interest authorized hereunder is unlimited.
All shares issued hereunder including, without limitation, shares issued in
connection with a dividend in shares or a split of shares, shall be fully paid
and non-assessable.

                  Pursuant to the powers vested in the Board of Trustees by this
Section 6.1, the Board of Trustees hereby authorizes the issuance of an
unlimited number of Common Shares of beneficial interest, par value $.01 per
share (the "Common Shares") together with 100,000,000 shares of beneficial
interest, par value of $.01 per share (the "Preferred Shares").

                  The designations and powers, preferences and rights, and the
qualifications, limitations and restrictions of the Common Shares are as set
forth in this Declaration of Trust.

                  The designations and powers, preferences and rights, and the
qualifications, limitations and restrictions of the Preferred Shares are as
follows:


                                       14

<PAGE>


                  The Preferred Shares shall be issued from time to time in one
or more series with such distinctive serial designations and (i) may have such
voting powers, full or limited; (ii) may be subject to redemption at such time
or times and at such price or prices; (iii) may be entitled to receive dividends
(which may be cumulative or noncumulative) at such rate or rates, on such
conditions, and at such times, and payable in preference to, or in such relation
to, the dividends payable on any other class or classes of shares; (iv) may have
such preferences or other rights upon the dissolution of, or upon any
distribution of the assets of, the Trust; (v) may be made convertible into, or
exchangeable for, shares of any other class or classes or of any other series of
the same or any other class or classes of shares of the Trust, at such price or
prices or at such rates of exchange and with such adjustments; (vi) shall have
such other relative, participating, optional or other special rights,
qualifications, limitations or restrictions thereof, all as shall hereafter be
stated and expressed in the resolution or resolutions providing for the issue of
such Preferred Shares from time to time adopted by the Board of Trustees
pursuant to authority so to do which is hereby expressly vested in the Board;
and are as further set out in this Declaration of Trust.

                  Section 6.2 Rights of Shareholders. The ownership to the Trust
Property of every description and the right to conduct any business hereinbefore
described are vested exclusively in the Trustees, and the Shareholders shall
have no interest conferred by their Shares, and they shall have no right to call
for any partition or division of any property, profits, rights or interests of
the Trust nor can they be called upon to assume any losses of the Trust or
suffer any assessment of any kind by virtue of their ownership of Shares. The
Shares shall be personal property giving only the rights in the Declaration
specifically set forth. The Shares shall not entitle the holder to preference,
preemptive, appraisal, conversion or exchange rights, except as the Trustees may
determine with respect to any class or series of Shares.

                  Section 6.3 Trust Only. It is the intention of the Trustees to
create only the relationship of Trustee and beneficiary between the Trustees and
each Shareholder from time to time. It is not the intention of the Trustees to
create a general partnership, limited partnership, joint stock association,
corporation, bailment or any form of legal relationship other than a trust.
Nothing in the Declaration shall be construed to make the Shareholders, either
by themselves or with the Trustees, partners and members of a joint stock
association.

                  Section 6.4 Issuance of Shares. The Trustees in their
discretion may, from time to time without vote of the Shareholders, issue
Shares, in addition to the then issued and outstanding Shares and Shares held in
the treasury, to such party or parties and for such amount and type of
consideration, including cash or property, at such time or times, and on such
terms as the Trustees may deem best, and may in such manner acquire other assets
(including the acquisition of assets subject to, and in connection with the
assumption of liabilities) and businesses. In connection with any issuance of
Shares, the Trustees may issue fractional Shares and Shares held in the
treasury. The Trustees may from time to time divide or combine the Shares or any
class or series into a greater or lesser number of such series without thereby
changing the proportionate beneficial

                                       15

<PAGE>

interests in the Trust. Contributions to the Trust may be accepted for whole
shares and/or 1/1,000ths of a Share or integral multiples thereof.

                  Section 6.5 Register of Shares. A register or registers shall
be kept at the principal office of the Trust or at an office of the Transfer
Agent which shall contain the names and addresses of the Shareholders and the
number of Shares held by them respectively and a record of all transfers
thereof. Such register shall be conclusive as to who are the holders of the
Common Shares and Preferred Shares and who shall be entitled to receive
dividends or distributions or otherwise to exercise or enjoy the rights of
Common Shareholders and Preferred Shareholders. No Shareholder shall be entitled
to receive payment of any dividend or distribution, nor to have notice given to
him as herein or in the By-laws provided, until he has given his address to the
Transfer Agent or such other officer or agent of the Trustees as shall keep the
said register for entry thereon. The Trustees, in their discretion, may
authorize the issuance of Share certificates and promulgate appropriate rules
and regulations as to their use.

                  Section 6.6 Transfer of Shares. Shares shall be transferable
on the records of the Trust only by the record holder thereof or by his agent
thereunto duly authorized in writing, upon delivery to the Trustees or the
Transfer Agent of a duly executed instrument of transfer, together with any
certificate or certificates (if issued) for such Shares and such evidence of the
genuineness of each such execution and authorization and of other matters as may
reasonably be required. Upon such delivery the transfer shall be recorded on the
register of the Trust. Until such record is made, the Shareholder of record
shall be deemed to be the holder of such Shares for all purposes hereunder and
neither the Trustees nor any Transfer Agent or register nor any officer,
employee or agent of the Trust shall be affected by any notice of the proposed
transfer.

                  Any person becoming entitled to any Shares in consequence of
the death, bankruptcy, or incompetence of any Shareholder or otherwise by
operation of law, shall be recorded on the register of Shares as the holder of
such Shares upon production of the proper evidence thereof to the Trustees or
the Transfer Agent; but until such record is made, the Shareholder of record
shall be deemed to be the holder of such Shares for all purposes hereunder and
neither the Trustees not any Transfer Agent or registrar nor any officer or
agent of the Trust shall be affected by any notice of such death; bankruptcy or
incompetence, or other operation of law.

                  Section 6.7 Notices. Any and all notices to which any
Shareholder may be entitled and any and all communications shall be deemed duly
served or given if mailed, postage prepaid, addressed to any Shareholder of
record at his last known address as recorded on the register of the Trust.

                  Section 6.8 Treasury Shares. Shares held in the treasury
shall, until reissued pursuant to Section 6.4, not confer any voting rights on
the Trustees, nor shall such Shares be entitled to any dividends or other
distributions declared with respect to the Shares.


                                       16

<PAGE>

                  Section 6.9 Voting Powers. The Shareholders shall have power
to vote only (i) for the election of Trustees as provided in Section 2.2 hereof,
(ii) with respect to any investment advisory or management contract as provided
in Section 4.1, (iii) with respect to termination of the Trust as provided in
Section 9.2, (iv) with respect to any amendment of the Declaration to the extent
and as provided in Section 9.3, (v) with respect to any merger, consolidation,
conversion or sale of assets as provided in Sections 9.4, 9.5, and 9.7, (vi)
with respect to incorporation of the Trust to the extent and as provided in
Section 9.5, (vii) to the same extent as the stockholders of a Massachusetts
business corporation as to whether or not a court action, proceeding or claim
should or should not be brought or maintained derivatively or as a class action
on behalf of the Trust or the Shareholders, (viii) with respect to such
additional matters relating to the Trust as may be required by the Declaration,
the By-laws or any registration of the Trust as an investment company under the
1940 Act with the commission (or any successor agency) or any state, or as the
Trustees may consider necessary or desirable and (ix) with respect to those
matters set forth in the designations and powers, preferences and rights, and
the qualifications, limitations and restrictions of the Preferred Shares, as
determined in accordance with Section 6.1 hereof. Each whole Share shall be
entitled to one vote as to any matter on which it is entitled to vote and each
fractional Share shall be entitled to a proportionate fractional vote. There
shall be no cumulative voting in the election of Trustees. Until Shares are
issued, the Trustees may exercise all rights of Shareholders and may take any
action required by law, the Declaration or the By-laws to be taken by
Shareholders. The By-laws may include further provisions for Shareholders votes
and meetings and related matters.

                                  ARTICLE VII

                        DETERMINATION OF NET ASSET VALUE,
                          NET INCOME AND DISTRIBUTIONS

                  The Trustees, in their absolute discretion, may prescribe and
shall set forth in the By-laws or in a duly adopted vote of the Trustees such
bases and times for determining the per share net asset value of the Common
Shares or net income, or the declaration and payment of dividends and
distributions, as they may deem necessary or desirable.

                                  ARTICLE VIII

                                   CUSTODIANS

                  The Trustee shall at all times employ one or more custodians,
meeting the qualifications for custodians for portfolio securities of investment
companies contained in the 1940 Act, as custodian with respect to the Trust. If
so directed by a Majority Shareholder Vote of each the Common Shares and the
Preferred Shares voting as separate classes, the custodian shall deliver and pay
over all property of the Trust held by it as specified in such vote.



                                       17

<PAGE>


                  The Trustees may also authorize each custodian to employ one
or more sub-custodians from time to time to perform such of the acts and
services of the custodian and upon such terms and conditions, as may be agreed
upon between the custodian and such sub-custodian and approved by the Trustees,
provided that in every case such subcustodian shall meet the qualifications for
custodians contained in the 1940 Act.

                                   ARTICLE IX

                         DURATION; TERMINATION OF TRUST;
                            AMENDMENT; MERGERS, ETC.

                  Section 9.1 Duration. Subject to possible termination in
accordance with the other provisions of Article IX hereof, the trust created
hereby shall continue without limitation of time.

                  Section 9.2 Termination of Trust. (a) The Trust may be
terminated (I) by the affirmative vote of the holders of not less than
seventy-five percent (75%) of each of the Common Shares and the Preferred Shares
outstanding and entitled to vote, voting as separate classes, at any meeting of
Shareholders, or (II) by an instrument in writing, without a meeting, signed by
a majority of the Trustees and consented to by the holders of not less than
seventy-five percent (75%) of each of such Common Shares and Preferred Shares.
Upon the termination of the Trust:

                              (i) The Trust shall carry on no business except
         for the purpose of winding up its affairs;

                              (ii) The Trustees shall proceed to wind up the
         affairs of the Trust and all of the powers of the Trustees under this
         Declaration shall continue until the affairs of the Trust shall have
         been wound up, including the power to fulfill or discharge the
         contracts of the Trust, collect its assets, sell, convey, assign,
         exchange, transfer or otherwise dispose of all or any part of the
         remaining Trust Property to one or more persons at public or private
         sale for consideration which may consist in whole or in part of cash,
         securities or other property of any kind, discharge or pay its
         liabilities, and to do all other acts appropriate to liquidate its
         business; provided, that any sale, conveyance, assignment, exchange,
         transfer or other disposition of all or substantially all of the Trust
         Property shall require Shareholder approval in accordance with Section
         9.4 hereof; and

                              (iii) After paying or adequately providing for the
         payment of all liabilities, and upon receipt of such releases,
         indemnities and refunding agreements as they deem necessary for their
         protection, the Trustees may distribute the remaining Trust Property,
         in cash or in kind or partly in cash and partly in kind, among the
         Shareholders according to their respective rights, including any
         preferential rights of Preferred Shares to receive such distribution.



                                       18

<PAGE>


                       (b) After termination of the Trust and distribution to
the Shareholders as herein provided, a majority of the Trustees shall execute
and lodge among the records of the Trust an instrument in writing setting forth
the fact of such termination, and the Trustees shall thereupon be discharged
from all further liabilities and duties hereunder, and the rights and interests
of all Shareholders shall thereupon cease.

                  Section 9.3 Amendment Procedure. (a) Except as provided in
paragraph (c) of this Section 9.3, this Declaration may be amended by a Majority
Shareholder Vote of each of the Common Shares and the Preferred Shares, voting
as separate classes, or by an instrument in writing, without a meeting, signed
by a majority of the Trustees and consented to by the holders of not less than a
majority of each of the Common Shareholders and the Preferred Shareholders,
voting as separate classes. The Trustees may also amend this Declaration without
the vote or consent of Shareholders to change the name of the Trust, to supply
any omission, to cure, correct or supplement any ambiguous, defective or
inconsistent provision hereof, to make any changes deemed necessary to
effectuate the designations and powers, preferences and rights, and the
qualifications, limitations and restrictions adopted by the Trustees with
respect to the Preferred Shares pursuant to Section 6.1 hereof, or if they deem
it necessary to conform this Declaration to the requirements of applicable
federal laws or regulations or the requirements of the regulated investment
company provisions of the Internal Revenue Code, but the Trustees shall not be
liable for failing so to do.

                       (b) No amendment, except pursuant to Section 6.1, may be
made under this Section 9.3 which would change any rights with respect to any
Shares by reducing the amount payable thereon upon liquidation of the Trust or
by diminishing or eliminating any voting rights pertaining thereto, except with
the vote or consent of the holders of two-thirds of the class of Shares so
effected outstanding and entitled to vote. Nothing contained in this Declaration
shall permit the amendment of this Declaration to impair the exemption from
personal liability of the Shareholders, Trustees, Officers, employees and agents
of the Trust or to permit assessment upon Shareholders.

                       (c) No amendment may be made under this Section 9.3 which
shall amend, alter, change or repeal any of the provisions of Sections 9.2, 9.3,
9.4, 9.6 and 9.7 unless the amendment effecting such amendment, alteration,
change or repeal shall receive the affirmative vote or consent of seventy-five
percent (75%) of each the Common Shareholders and the Preferred Shareholders,
voting as separate classes. Such affirmative vote or consent shall be in
addition to the vote or consent of the holders of Shares otherwise required by
law or by the terms of any class or series of Preferred shares, whether now or
hereafter authorized, or any agreement between the Trust and any national
securities exchange.

                       (d) A certificate signed by a majority of the Trustees
setting forth an amendment and reciting that it was duly adopted by the
Shareholders or by the Trustees as aforesaid or a copy of the Declaration, as
amended, and executed by a majority of the Trustees, shall be conclusive
evidence of such amendment when lodged among the records of the Trust.


                                       19

<PAGE>

                  Notwithstanding any other provision hereof, until such time as
a Registration Statement under the Securities Act of 1933, as amended, covering
the first public offering of securities of the Trust shall have become
effective, this Declaration may be terminated or amended in any respect by the
affirmative vote of a majority of the Trustees or by an instrument signed by a
majority of the Trustees.

                  Section 9.4 Merger, Consolidation and Sale of Assets. Subject
to Section 9.7, the Trust may merge or consolidate with any other corporation,
association, trust or other organization or may sell, lease or exchange all or
substantially all of the Trust Property, including its good will, upon such
terms and conditions and for such consideration when and as authorized at any
meeting of Shareholders called for the purpose by the affirmative vote of the
holders of not less than two-thirds of the Common Shares and the Preferred
Shares outstanding and entitled to vote, voting as separate classes or by an
instrument or instruments in writing without a meeting, consented to by the
holders of not less than two-thirds of each such class of Common Shares and
Preferred Shares, provided, however, that if such merger, consolidation, sale,
lease or exchange is recommended by the Trustees, the vote or written consent of
the holders of a majority of the Common Shares and the Preferred Shares
outstanding and entitled to vote, voting as separate classes shall be sufficient
authorization and any such merger, consolidation, sale, lease or exchange shall
be deemed for all purposes to have been accomplished under and pursuant to the
statutes of the Commonwealth of Massachusetts.

                  Section 9.5 Incorporation and Reorganization. Subject to
Section 9.7 with the approval of the holders of a majority of the Common Shares
and Preferred Shares outstanding and entitled to vote, voting as separate
classes the Trustees may cause to be organized or assist in organizing a
corporation or corporations under the laws of any jurisdiction, or any other
trust, partnership, association or other organization to take over all of the
Trust Property or to carry on any business in which the Trust shall directly or
indirectly have any interest, and to sell, convey and transfer the Trust
Property to any such corporation, trust, partnership, association or
organization in exchange for the shares or securities thereof or otherwise and
to lend money to, subscribe for the shares or securities of, and enter into any
contracts with any such corporation, trust, partnership, association or
organization or any corporation, partnership, association, trust, or
organization in which the Trust holds or is about to acquire shares or any other
interest. The Trustees may also cause a merger or consolidation between the
Trust or any successor thereto and any such corporation, trust, partnership,
association or other organization if and to the extent permitted by law, as
provided under the law then in effect. Nothing contained herein shall be
construed as requiring approval of Shareholders for the Trustees to organize or
assist in organizing one or more corporations, trusts, partnerships,
associations or other organizations and selling, conveying or transferring a
portion of the Trust Property to such organization or entities.

                  Section 9.6 Conversion to Open-End Company. Notwithstanding
any other provisions of this Declaration or the By-Laws, an amendment to this
Declaration that makes the Shares a "redeemable security" (as that term is
defined in the 1940 Act) shall be required to be approved by at least (a) a
majority of the Trustees, including a majority of the Trustees who are not
Interested Persons; and (b) a majority Shareholder

                                       20

<PAGE>

Vote of each the Common Shareholders and the Preferred Shareholders, voting as
separate classes.

                  The Trust shall notify the holders of all capital securities
of the approval, in accordance with the preceding paragraph of this Section 9.6,
of any amendment to this Declaration that makes the Shares a "redeemable
security" (as that term is defined in the 1940 Act) no later than thirty (30)
days prior to the date of filing of such amendment with the Secretary of State
of the Commonwealth of Massachusetts; provided, however, that such amendment may
not be so filed until the later of ninety (90) days following the date of
approval of such amendment by the holders of shares in accordance with the
preceding paragraph of this Section 9.6 or thirty (30) days following the date
on which notice of the approval of such amendment is first given to
Shareholders.

                  Section 9.7 Certain Transactions. (a) Notwithstanding any
other provision of this Declaration and subject to the exceptions provided in
paragraph (d) of this Section, the types of transactions described in paragraph
(c) of this Section shall require the affirmative vote or consent of the holders
of sixty-six and two-thirds percent (66 2/3%) of the Common Shares and Preferred
Shares outstanding and entitled to vote, voting as separate classes when a
Principal shareholder (as defined in paragraph (b) of this Section) is a party
to the transaction. Such affirmative vote or consent shall be in addition to the
vote or consent of the holders of Shares otherwise required by law or by the
terms of any class or series of Preferred Shares, whether now or hereafter
authorized, or any agreement between the Trust and any national securities
exchange.

                       (b) The term "Principal Shareholder" shall mean any
corporation, person or other entity which is the beneficial owner, directly or
indirectly, of more than five percent (5%) of the outstanding Shares and shall
include any affiliate or associate, as such terms are defined in clause (ii)
below, of a Principal Shareholder. For the purposes of this section, in addition
to the Shares which a corporation, person or other entity beneficially owns
directly, (a) any corporation, person or other entity shall be deemed to be the
beneficial owner of any Shares (i) which it has the right to acquire pursuant to
any agreement or upon exercise of conversion rights or warrants, or otherwise
(but excluding share options granted by the Trust) or (ii) which are
beneficially owned, directly or indirectly (including shares deemed owned
through application of clause (i) above), by any other corporation, person or
entity with which it or its "affiliate" or "associate" (as defined below) has
any agreement, arrangement or understanding for the purpose of acquiring,
holding, voting or disposing of Shares, or which is its "affiliate", or
"associate" as those terms are defined in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934 as in effect on August 1,
1988, and (b) the outstanding Shares shall include Shares deemed owned through
application of clauses (i) and (ii) above but shall not include any other Shares
which may be issuable pursuant to any agreement, or upon exercise of conversion
rights or warrants, or otherwise.

                                       21

<PAGE>


                       (c) This Section shall apply to the following
transactions:

                              (i) The merger or consolidation of the Trust or
         any subsidiary of the Trust with or into any Principal Shareholder.

                              (ii) The issuance of any securities of the Trust
         to any Principal Shareholder for cash.

                              (iii) The sale, lease or exchange of all or any
         substantial part of the assets of the Trust to any Principal
         Shareholder (except assets having an aggregate fair market value of
         less than $1,000,000, aggregating for the purpose of such computation
         all assets sold, leased or exchanged in any series of similar
         transactions within a twelve-month period).

                              (iv) The sale, lease or exchange to the Trust or
         any subsidiary thereof, in exchange for securities of the Trust of any
         assets of any Principal Shareholder (except assets having an aggregate
         fair market value of less than $1,000,000, aggregating for the purposes
         of such computation all assets sold, leased or exchanged in any series
         of similar transactions within a twelve-month period).

                       (d) The provisions of this Section shall not be
applicable to (i) any of the transactions described in paragraph (c) of this
Section if the Board of Trustees of the Trust shall by resolution have approved
a memorandum of understanding with such Principal Shareholder with respect to
and substantially consistent with such transaction, or (ii) any such transaction
with any corporation of which a majority of the outstanding shares of all
classes of stock normally entitled to vote in elections of directors is owned of
record or beneficially by the Trust and its subsidiaries.

                       (e) The Board of Trustees shall have the power and duty
to determine for the purposes of this Section on the basis of information known
to the Trust, whether (i) a corporation, person or entity beneficially owns more
than five percent (5%) of the outstanding Shares, (ii) a corporation, person or
entity is an "affiliate" or "associate" (as defined above) of another, (iii) the
assets being acquired or leased to or by the Trust or any subsidiary thereof,
constitute a substantial part of the assets of the Trust and have an aggregate
fair market value of less than $1,000,000, and (iv) the memorandum of
understanding referred to in paragraph (d) hereof is substantially consistent
with the transaction covered thereby. Any such determination shall be conclusive
and binding for all purposes of this Section.

                                   ARTICLE X

                                  SHAREHOLDERS

                  Section 10.1 Meetings of Shareholders. An annual meeting of
the Shareholders for the election of Trustees and for the transaction of such
other business as may properly be brought before the meeting shall be held if
the holding of such a meeting is required by law or by the rules of any exchange
on which Shares are listed for trading,

                                       22


<PAGE>

on the second Thursday of May of each year, or at such other date, at such place
within or without the Commonwealth of Massachusetts at such time as the Trustees
shall designate from time to time. A Special Meeting of Shareholders may be
called at any time by a majority of the Trustees and shall be called by any
Trustee for any proper purpose upon written request of Shareholders of the Trust
holding in the aggregate: with respect to matters not requiring voting by the
Common Shareholders and Preferred Shareholders as separate classes, not less
than 51% of the outstanding Common Shares and Preferred Shares voting as single
class, such request specifying the purpose or purposes for which such meeting is
to be called; with respect to matters requiring voting by the Common
Shareholders and Preferred Shareholders as separate classes, not less than 51%
of the outstanding Common Shares and not less than 51% of the outstanding
Preferred Shares, unless some other percentage for the Preferred Shares is set
forth in the designation pursuant to Section 6.1 hereof, voting as separate
classes, such request specifying the purpose or purposes for which such meeting
is to be called; or, in the case of a meeting for the purpose of voting on the
question of removal of any Trustee or Trustees, upon written request of the
class of Shareholders entitled to vote on the removal of such Trustee or
Trustees holding in the aggregate not less than 10% of the outstanding Shares of
such class; or, in the case of a meeting for the purpose of voting on the
question of removal of the independent public accountants of the Trust, upon
written request of Common Shareholders and Preferred Shareholders voting as a
single class, holding in the aggregate not less than 10% of the outstanding
Common Shares and Preferred Shares. Any Special Meeting shall be held within or
without the Commonwealth of Massachusetts on such day and at such time as the
Trustees shall designate.

                  Section 10.2 Voting. Shareholders shall have no power to vote
on any matter except matters on which a vote of Shareholders is required by
applicable law, this Declaration or resolution of the Trustees. There shall be
no cumulative voting in the election or removal of Trustees.

                  Section 10.3 Notice of Meeting and Record Date. Notice of all
meetings of Shareholders, stating the time, place and purposes of the meeting,
shall be given by the Trustees by mail to each Shareholder of record entitled to
vote thereat at his registered address, mailed at least 10 days and not more
than 60 days before the meeting. Only the business stated in the notice of the
meeting shall be considered at such meeting. Any adjourned meeting may be held
as adjourned without further notice. For the purposes of determining the
Shareholders who are entitled to notice of and to vote at any meeting the
Trustees may, without closing the transfer books, fix a date not more than 60
days prior to the date of such meeting of Shareholders as a record date for the
determination of the Persons to be treated as Shareholders of record for such
purposes.

                  Section 10.4 Quorum and Required Vote. The holders of a
majority of outstanding Shares of each class or series or combined class
entitled to vote thereat of the Trust present in person or by proxy shall
constitute a quorum at any meeting of the Shareholders for purposes of
conducting business on which a vote of Shareholders of the Trust is being taken.
Subject to any provision of applicable law, this Declaration or resolution of
the Trustees specifying a greater or lesser vote requirement for the transaction
of any item of business at any meeting of Shareholders, the affirmative vote


                                       23

<PAGE>

of a majority of the Shares of any class or series present in person or
represented by proxy and entitled to vote on the subject matter shall be the act
of the Shareholders of such class or series with respect to such matter.

                  Section 10.5 Proxies, etc. At any meeting of Shareholders, any
holder of Shares entitled to vote thereat may vote by properly executed proxy,
provided that no proxy shall be voted at any meeting unless it shall have been
placed on file with the Secretary, or with such other officer or agent of the
Trust as the Secretary may direct, for verification prior to the time at which
such vote shall be taken. Pursuant to a resolution of a majority of the
Trustees, proxies may be solicited in the name of one or more Trustees or one or
more of the officers or employees of the Trust. Only Shareholders of record
shall be entitled to vote. Each full Share shall be entitled to one vote and
fractional Shares shall be entitled to a vote of such fractions. when any Share
is held jointly by several persons, any one of them may vote at any meeting in
person or by proxy in respect of such Share, but if more than one of them shall
be present at such meeting in person or by proxy, and such joint owners or their
proxies so present disagree as to any vote to be cast, such vote shall not be
received in respect of such Share. A proxy purporting to be executed by or on
behalf of a Shareholder shall be deemed valid unless challenged at or prior to
its exercise, and the burden of proving invalidity shall rest on the challenger.
If the holder of any such Share is a minor or a person of unsound mind, and
subject to guardianship or to the legal control of any other person as regards
the charge or management of such Share, he may vote by his guardian or such
other person appointed or having such control, and such vote may be given in
person or by proxy.

                  Section 10.6 Reports. The Trustees shall cause to be prepared
at least annually and more frequently to the extent required by law a report of
operations containing a balance sheet and statement of income and undistributed
income of the Trust prepared in conformity with generally accepted accounting
principles and an opinion of an independent public accountant on such financial
statements. Copies of such reports shall be mailed to all Shareholders of record
within the time required by the 1940 Act. The Trustees shall, in addition,
furnish to the Shareholders at least semi-annually to the extent required by
law, interim reports containing an unaudited balance sheet as of the end of such
period and an unaudited statement of income and surplus for the period from the
beginning of the current fiscal year to the end of such period.

                  Section 10.7 Inspection of Records. The records of the Trust
shall be open to inspect on by Shareholders to the same extent as is permitted
shareholders of a Massachusetts business corporation.

                  Section 10.8 Shareholder Action by Written Consent. Any action
which may be taken by Shareholders by vote may be taken without a meeting if the
holders entitled to vote thereon of the proportion of Shares of the class or
classes required for approval of such action at a meeting of Shareholders
pursuant to Section 10.4 consent to the action in writing and the written
consents be filed with the records of the meetings of Shareholders. Such consent
shall be treated for all purposes as a vote taken at a meeting of Shareholders.


                                       24

<PAGE>

                                   ARTICLE XI

                                  MISCELLANEOUS

                  Section 11.1 Filing. This Declaration and any amendment hereto
shall be filed in the office of the Secretary of the Commonwealth of
Massachusetts and in such other places as may be required under the laws of
Massachusetts and may also be filed or recorded in such other places as the
Trustees deem appropriate. Each amendment so filed shall be accompanied by a
certificate signed and acknowledged by a Trustee stating that such action was
duly taken in a manner provided herein, and unless such amendment or such
certificate sets forth some later time for the effectiveness of such amendment,
such amendment shall be effective upon its filing. A restated Declaration,
integrating into a single instrument all of the provisions of the Declaration
which are then in effect and operative, may be executed from time to time by a
majority of the Trustees and shall upon filing with the Secretary of the
Commonwealth of Massachusetts, be conclusive evidence of all amendments
contained therein and may thereafter be referred to in lieu of the original
Declaration and the various amendments thereto.

                  Section 11.2 Governing Law. This Declaration is executed by
the Trustees and delivered in The Commonwealth of Massachusetts and with
reference to the laws thereof, and the rights of all parties and the validity
and construction of every provision hereof shall be subject to and construed
according to the laws of said Commonwealth.

                  Section 11.3 Counterparts. This Declaration may be
simultaneously executed in several counterparts, each of which shall be deemed
to be an original, and such counterparts, together, shall constitute one and the
same instrument, which shall be sufficiently evidenced by any such original
counterpart.

                  Section 11.4 Reliance by Third Parties. Any certificate
executed by an individual who, according to the records of the Trust appears to
be a Trustee hereunder, certifying: (a) the number or identity of Trustees or
Shareholders, (b) the due authorization of the execution of any instrument or
writing, (c) the form of any vote passed at a meeting of Trustees or
Shareholders, (d) the fact that the number of Trustees or shareholders present
at any meeting or executing any written instrument satisfies the requirements of
this Declaration, (e) the form of any By-laws adopted by or the identity of any
officers elected by the Trustees, or (f) the existence of any fact or facts
which in any manner relate to the affairs of the Trust, shall be conclusive
evidence as to the matters so certified in favor of any Person dealing with the
Trustees and their successors.

                  Section 11.5 Provisions in Conflict with Law or Regulations.
(a) The provisions of the Declaration are severable, and if the Trustees shall
determine, with the advice of counsel, that any of such provisions is in
conflict with the 1940 Act, the regulated investment company provisions of the
Internal Revenue Code of 1986, or any amendments or successor statute thereto,
or with other applicable laws and regulations, the conflicting provision shall
be deemed not to constitute and never to have constituted a part of the
Declaration; provided, however, that such determination shall not affect any of

                                       25

<PAGE>

the remaining provisions of the Declaration or render invalid or improper any
action taken or omitted prior to such determination.

                       (b) If any provision of the Declaration shall be held
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall apply only to such provision in such jurisdiction and
shall not in any manner affect such provision in any other jurisdiction or any
other provision of the Declaration in any jurisdiction.

                  Section 11.6 Use of the Names "Van Kampen Merritt". Van Kampen
Merritt Inc. ("Van Kampen") has consented to the use by the Trust of the
identifying words or names "Van Kampen Merritt" or "VKM" in the name of the
Trust. Such consent is conditioned upon the employment of Van Kampen its
successors or any affiliate thereof, as investment advisor or distributor of the
Trust. As between the Trust and itself, Van Kampen controls the use of the name
of the Trust insofar as such name contains "Van Kampen Merritt" or "VKM". The
names or identifying words "Van Kampen Merritt" or "VKM" may be used from time
to time in other connections and for other purposes by Van Kampen or affiliated
entities. Van Kampen may require the Trust to cease using "Van Kampen Merritt"
or "VKM" in the name of the Trust if the Trust ceases to employ, for any reason,
Van Kampen, an affiliate, or any successor as investment advisor or distributor
of the Trust.

                  IN WITNESS WHEREOF, the undersigned have caused these presents
to be executed as of the day and year first above written.

/s/ David C. Arch                       Dennis J. McDonnell
- ---------------------------------       -------------------
David C. Arch                           Dennis J. McDonnell


/s/ Clyde H. Keith                      /s/ Wayne W. Whalen
- ---------------------------------       -------------------
Clyde H. Keith                          Wayne W. Whalen


/s/ John C. Merritt                     /s/ Theodore A. Myers
- ---------------------------------       ---------------------
John C. Merritt                         Theodore A. Myers


/s/ Rod Dammeyer                        being all of the members of the Board of
- ---------------------------------       Trustees of the Trust
Rod Dammeyer



                                       26
<PAGE>

State of                   )
                           ) ss
County of                  )

                  Then personally appeared before me David C. Arch, Dennis J.
McDonnell, Clyde H. Keith, Wayne W. Whalen, John C. Merritt, Theodore A. Myers
and Rod Dammeyer who acknowledged the foregoing instrument of be their free act
and deed and the free act and deed of the Trustees of Van Kampen Merritt
Municipal Trust.

                                   Before me,

                                           /s/ Jennifer A. Herd
                                   ------------------------------------------
                                   Notary Public

My Commission Expires:     06/28/93
                       -------------

                  The addresses of the Trustees of the Trust are as follows:

                           John C. Merritt
                           2 Penn Center
                           Suite 1600
                           Philadelphia, Pennsylvania 19102

                           Dennis J. McDonnell
                           1001 Warrenville Road
                           Lisle, Illinois 60532

                           Theodore A. Myers
                           321 N. Main Street
                           Hutchinson, Kansas 67504

                           Rod Dammeyer
                           Two North Riverside Plaza
                           Chicago, Illinois 60606

                           David C. Arch
                           1800 Swift Drive
                           Oak Brook, Illinois 60521

                           Clyde H. Keith
                           1119 Golfview Lane
                           Glenview, Illinois 60025

                           Wayne W. Whalen
                           333 West Wacker Drive
                           Chicago, Illinois 60606




                                       27
<PAGE>



                            CERTIFICATE OF AMENDMENT
                          TO THE DECLARATION OF TRUST
                                       OF
                           VAN KAMPEN MUNICIPAL TRUST
                                 (THE "TRUST")

                  1. The Declaration of Trust amended by this document was
originally filed with the Secretary of the Commonwealth of Massachusetts on July
19, 1991.

                  2. Pursuant to this Certificate of Amendment, the principal
place of business of the Trust shall be changed to 1221 Avenue of the Americas,
New York, New York 10020. To effect the aforesaid amendment, Article 1, Section
1.1, of the Declaration of Trust of the Trust, relating to the principal office
of the Trust, is amended to read as follows:

                                    ARTICLE I

             NAME, PRINCIPAL OFFICE, RESIDENT AGENT AND DEFINITIONS

                  Section 1.1 Name, Principal Office and Resident Agent. The
name of the trust created hereby is the "Van Kampen Municipal Trust"(the
"Trust").

                  The post office address of the principal office of the Trust
is 1221 Avenue of the Americas, New York, New York 10020. The name of the
resident agent of the Trust in the Commonwealth of Massachusetts is CT
Corporation System, a Delaware corporation, and the post office address of the
resident agent is 101 Federal Street, Boston, Massachusetts 02110.

                                   ARTICLE II

                                    TRUSTEES

                  Section 2.1 of the Declaration of Trust with respect to the
names of the Trustees is hereby amended by removing John L. Sullivan, One
Parkview Plaza, Oakbrook Terrace, Illinois 60181 and adding Mitchell M. Merin,
1221 Avenue of the Americas, New York, New York 10020.

                  3. Such amendment shall become effective as of the close of
business on June 15, 2004.

                  4. The amendment herein provided for was authorized in
accordance with law.


<PAGE>


                  IN WITNESS WHEREOF, the undersigned has signed these presents
all on June 15, 2004.

                                        /s/ Wayne W. Whalen
                                        ---------------------------------------
                                        Name: Wayne W. Whalen
                                        As Trustee, and not individually


                                 ACKNOWLEDGEMENT

STATE OF ILLINOIS)
                 ) SS
COUNTY OF COOK   )




                  On this 15th day of June, 2004, before me personally appeared
Wayne W. Whalen, to me known to be the person described in and who executed the
foregoing instrument, and acknowledged that he executed the same as his free act
and deed.


                                        /s/ Kurt Balder
                                        --------------------------------------
                                        Notary Public

                                        My commission expires: 03/08/06




                                       2
<PAGE>


                            CERTIFICATE OF AMENDMENT
                                     TO THE
                              DECLARATION OF TRUST
                                       OF

                           Van Kampen Municipal Trust

           Pursuant to 950 CMR 109.04 of the Massachusetts General Law

                  1. The name of the trust is Van Kampen Municipal Trust (the
"Trust") and its Declaration of Trust was originally filed with the Commonwealth
of Massachusetts on August 15, 1988.

                  2. Pursuant to this Certificate of Amendment, the number of
Trustees of the Trust shall be increased to fifteen (15). To effect this change,
Article II, Section 2.1 of the Declaration of Trust is hereby amended to read as
follows:

                                   ARTICLE II
                                    TRUSTEES

         Section 2.1 Number of Trustees. The number of Trustees shall initially
         be three (3), and after a registration statement under the Securities
         Act of 1933, as amended, covering the first public offering of
         securities of the Trust shall have been filed, the number of Trustees
         shall be such number as shall be fixed from time to time by a written
         instrument signed by a majority of the Trustees, provided, however,
         that, following the date such registration statement shall have become
         effective (the "effective date"), the number of Trustees shall in no
         event be less than three (3) nor more than fifteen (15), except as such
         number shall be increased in connection with the rights of the holders
         of the Preferred Shares to elect a majority of the Trustees, as
         provided for in Section 2.2 hereof. No reduction in the number of
         Trustees shall have the effect of removing any Trustee from office
         prior to the expiration of his term unless the Trustee is specifically
         removed pursuant to Section 2.2 of this Article II at the time of the
         decrease.

                  3. Such amendment shall become effective as of the close of
business on Friday, July 11, 2003.

                  IN WITNESS WHEREOF, this Certificate of Amendment has been
duly executed this 11th day of July, 2003.



                                        /s/ Wayne W. Whalen
                                        --------------------------------------
                                        Name: Wayne W. Whalen
                                        As Trustee, and not individually



<PAGE>


                            CERTIFICATE OF AMENDMENT
                                     TO THE
                              DECLARATION OF TRUST
                                       OF


                   Van Kampen American Capital Municipal Trust

           Pursuant to 950 CMR 109.04 of the Massachusetts General Law

         1.       The name of the trust is Van Kampen American Capital Municipal
                  Trust (the "Trust") and its Declaration of Trust was
                  originally filed with the Commonwealth of Massachusetts on
                  July 19, 1991.

         2.       Pursuant to this Certificate of Amendment, the name of the
                  Trust will be changes to "Van Kampen Municipal Trust". To
                  effect this change, Article 1. of the Declaration of Trust is
                  hereby amended to read as follows:

                           1. The name of the Trust is: Van Kampen Municipal
                  Trust ("Trust").

         3.       Such name change shall become effective as of the close of
                  business on Friday, August 28, 1998.

                  IN WITNESS WHEREOF, this Certificate of Amendment has been
duly executed this 6th day of August, 1998





                                          /s/ Wayne W. Whalen
                                        --------------------------------------
                                        Name:  Wayne W. Whalen
                                        As Trustee and not individually





<PAGE>


                            CERTIFICATE OF AMENDMENT
                                       OF
                              DECLARATION OF TRUST

                        Pursuant to Chapter 183 Section 2
                        of the Massachusetts General Laws

                  Van Kampen Merritt Municipal Trust, a voluntary association
with transferable shares organized and existing under and by virtue of the laws
of the Commonwealth of Massachusetts (the "Trust"), DOES HEREBY CERTIFY:

                  FIRST: That the Directors considered a proposal to change the
Trust's name to delete the word "Merritt" and substitute the words "American
Capital." Subsequently, the Directors unanimously adopted a resolution setting
forth a proposed amendment to the Declaration of Trust, declaring said amendment
to be advisable. The resolution setting forth the proposed amendment is as
follows:

                           RESOLVED, that the proper officers of the Trust be,
                  and each of them hereby is authorized and directed, in the
                  name and on behalf of the Trust, to take all actions to cause
                  to be prepared and filed all other documents, to make all
                  expenditures and to execute all instruments by them to be
                  necessary or desirable in effectuating a name change for the
                  Trust to delete the word "Merritt" and substitute the words
                  "American Capital", including without limitation the
                  preparation of an amendment to each Trust's Declaration of
                  Trust, notification to the exchanges, the employment or
                  retention of all such counsel, accountants and experts as may
                  be deemed advisable by them, and the taking of such actions,
                  the execution and filing or delivery of such documents, and
                  the performance of such acts by them shall be conclusive
                  evidence of their approval thereof and the approval thereof
                  and authority therefor by and from such Trust.

                  SECOND: That the proper officers of the Trust have authorized
and directed that the Declaration of Trust be amended by changing the first
paragraph of Article I thereof so that as amended, said paragraph shall be and
read as follows:

                  Section 1.1 Name, Principal Office and Resident Agent. The
         name of the trust created hereby is the Van Kampen American Capital
         Municipal Trust.

                  THIRD: That such name change shall become effective as of the
close of business on Friday, December 29, 1995.




<PAGE>


                  IN WITNESS WHEREOF, Van Kampen Merritt Municipal Trust has
caused this Certificate of Amendment to be executed in its name this 29 day of
December, 1995.

                                        VAN KAMPEN MERRITT MUNICIPAL TRUST


                                          /s/ Dennis J. McDonnell
                                        --------------------------------------
                                        Name: Dennis J. McDonnell
                                        Title: Trustee





                                       2
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(2)
<SEQUENCE>3
<FILENAME>c93084a1exv99wx2y.txt
<DESCRIPTION>BYLAWS
<TEXT>
<PAGE>

                                                                       EXHIBIT 2

                   VAN KAMPEN MERRITT QUALITY MUNICIPAL TRUST

                                     BY-LAWS

                  These By-Laws (the "By-Laws") are made and adopted pursuant to
Section 3.8 of the Declaration of Trust establishing VAN KAMPEN MERRITT QUALITY
MUNICIPAL TRUST, as from time to time amended (hereinafter called the
"Declaration"). All words and terms capitalized in these By-Laws shall have the
meaning or meanings set forth for such words or terms in the Declaration.

                                   ARTICLE I

                              Shareholder Meetings

                  Section 1.1 Chairman. The Chairman, if any, shall act as
chairman at all meetings of the Shareholders; in his absence, the Trustee or
Trustees present at each meeting may elect a temporary chairman for the meeting,
who may be one of themselves.

                  Section 1.2 Proxies; Voting. Shareholders may vote either in
person or by duly executed proxy and each full share represented at the meeting
shall have one vote, all as provided in Article 10 of the Declaration. No proxy
shall be valid after eleven (11) months from the date of its execution, unless a
longer period is expressly stated in such proxy.

                  Section 1.3 Closing of Transfer Books and Fixing Record Dates.
For the purpose of determining the Shareholders who are entitled to notice of or
to vote or act at any meeting, including any adjournment thereof, or who are
entitled to participate in any dividends, or for any other proper purpose, the
Trustees may from time to time close the transfer bonds or fix a record date in
the manner provided in Section 10.3 of the Declaration. If the Trustees do not
prior to any meeting of shareholders so fix a record date or close the transfer
books, then the date of mailing notice of the meeting or the date upon which the
dividend resolution is adopted, as the case may be, shall be the record date.

                  Section 1.4 Inspectors of Election. In advance of any meeting
of Shareholders, the Trustees may appoint Inspectors of Election to act at the
meeting or any adjournment thereof. If Inspectors of Election are not so
appointed, the Chairman, if any, of any meeting of Shareholders may, and on the
request of any Shareholder or his proxy shall, appoint Inspectors of Election of
the meeting. The number of Inspectors shall be either one or three. If appointed
at the meeting on the request of one or more Shareholders or proxies, a majority
of Shares present shall determine whether one or three Inspectors are to be
appointed, but failure to allow such determination by the Shareholders shall not
affect the validity of the appointment of Inspectors of Election. In case any
person appointed as Inspector fails to appear or fails or refuses to act, the
vacancy may be filled by appointment made by the Trustees in advance of the
convening of the meeting or at the meeting by the person acting as chairman. The
Inspectors of Election shall determine the number of shares outstanding, the
Shares represented at the


<PAGE>


meeting, the existence of a quorum, the authenticity, validity and effect of
proxies, shall receive votes, ballots or consents, shall hear and determine all
challenges and questions in any way arising in connection with right to vote,
shall count and tabulate all votes or consents, determine the results, and do
such other acts as may be proper to conduct the election or vote with fairness
to all Shareholders. If there are three Inspectors of Election, the decision,
act or certificate of a majority is effective in all respects as the decision,
act or certificate of all. On request of the Chairman, if any, of the meeting,
or of any Shareholder or his proxy, the Inspectors of Election shall make a
report in writing of any challenge or question or matter determined by them and
shall execute a certificate of any facts found by them.

                  Section 1.5 Records at Shareholder Meetings. At each meeting
of the Shareholders there shall be open for inspection the minutes of the last
previous Meeting of Shareholders of the Trust and a list of the Shareholders of
the Trust, certified to be true and correct by the Secretary or other proper
agent of the Trust, as of the record date of the meeting or the date of closing
of transfer books, as the case may be. Such list of Shareholders shall contain
the name of each Shareholder in alphabetical order and the address of Shares
owned by such Shareholder. Shareholders shall have such other rights and
procedures of inspection of the books and records of the Trust as are granted to
shareholders of a Massachusetts business corporation.

                                   ARTICLE II

                                    Trustees

                  Section 2.1 Trustees Meeting. The Trustees shall hold an
annual meeting for the election of officers and the transactions of other
business which may come before such meeting. Neither the business to be
transacted at, nor the purpose of, any meeting of the Board of Trustees need be
stated in the notice or waiver of notice of such meeting, and no notice need be
given of action proposed to be taken by unanimous written consent.

                  Section 2.2 Chairman; Records. The Chairman, if any, shall act
as chairman at all meetings of the Trustees; in his absence the Trustees present
shall elect one of their number to act as temporary chairman. The results of all
actions taken at a meeting of the Trustees, or by unanimous written consent of
the Trustees, shall be recorded by the secretary.

                                  ARTICLE III

                                    Officers

                  Section 3.1 Officers of the Trust. The officers of the Trust
shall consist of a Chairman, if any, a President, a Secretary, a Treasurer and
such other officer or assistant officers, including Vice Presidents, as may be
elected by the Trustees. Any two or more of the offices may be held by the same
person, except that the same person may not be both President and Secretary. The
Trustees may designate the order in which


                                       2

<PAGE>

the other Vice Presidents may act. The Chairman, if any, shall be a Trustee, but
no other officer of the Trust need be a Trustee.

                  Section 3.2 Election and Tenure. At the initial organization
meeting and thereafter at each annual meeting of the Trustees, the Trustees
shall elect the Chairman, if any, President, Secretary, Treasurer and such other
officers as the Trustees shall deem necessary, or appropriate in order to carry
out the business of the Trust. Such officers shall hold office until the next
annual meeting of the Trustees and until their successors have been duly elected
and qualified. The Trustees may fill any vacancy in office or add any additional
officers at any time.

                  Section 3.3 Removal of Officers. Any officer may be removed at
any time, with or without cause, by action of a majority of the Trustees. This
provision shall not prevent the making of a contract of employment for a
definite term with any officer and shall have no effect upon any cause of action
which any officer may have as a result of removal in breach of a contract of
employment. Any officer may resign at any time by notice in writing signed by
such officer and delivered or mailed to the Chairman, if any, President, or
Secretary, and such resignation shall take effect immediately upon receipt by
the Chairman, if any, President, or Secretary, or at a later date according to
the terms of such notice in writing.

                  Section 3.4 Bonds and Surety. Any officer may be required by
the Trustees to be bonded for the faithful performance of his duties in such
amount and with such sureties as the Trustee may determine.

                  Section 3.5 Chairman, President, and Vice President. The
Chairman, if any, shall, if present, preside at all meetings of the Shareholders
and of the Trustees and shall exercise and perform such other powers and duties
as may be from time to time assigned to him by the Trustees. Subject to such
supervisory powers, if any, as may be given by the Trustees to the Chairman, if
any, the President shall be the chief executive officer of the Trust and,
subject to the control of the Trustees, shall have general supervision,
direction and control of the business of the Trust and of its employees and
shall exercise such general powers of management as are usually vested in the
office of President of a corporation. Subject to direction of the Trustees, the
Chairman, if any, and the President shall each have power in the name and on
behalf of the Trust or any of its Series to execute any and all loans,
documents, contracts, agreements, deeds, mortgages, registration statements,
applications, requests, filings and other instruments in writing, and to employ
and discharge employees and agents of the Trust. Unless otherwise directed by
the Trustees, the Chairman, if any, and the President shall each have full
authority and power, on behalf of all of the Trustees, to attend and to act to
vote, on behalf of the Trust at any meetings of business organizations in which
the Trust holds an interest, or to confer such powers upon any other persons, by
executing any proxies duly authorizing such persons. The Chairman, if any, and
the President shall have such further authorities and duties as the Trustees
shall from time to time determine. In the absence or disability of the
President, the Vice Presidents in order of their rank as fixed by the Trustees
or, if more than one and not ranked, the Vice President designated by the
Trustees, shall perform all of the duties of the President, and when so acting
shall have all


                                       3

<PAGE>


the powers of and be subject to all of the restrictions upon the President.
Subject to the direction of the Trustees, and of the President, each Vice
President shall have the power in the name and on behalf of the Trust to execute
any and all instruments in writing, and, in addition, shall have such other
duties and powers as shall be designated from time to time by the Trustees or by
the President.

                  Section 3.6 Secretary. The Secretary shall keep the minutes of
all meetings of, and record all votes of, Shareholders, Trustees and the
Executive Committee, if any. He shall be custodian of the seal of the Trust, if
any, and he (and any person so authorized by the Trustees) shall affix the seal
or, if permitted, facsimile thereof, to any instrument executed by the Trust
which would be sealed by a Massachusetts business corporation executing the same
or a similar instrument and shall attest the seal and the signature or
signatures of the officer or officers executing any other duties commonly
incident to such office in a Massachusetts business corporation, and shall have
such other authorities and duties as the Trustees shall from time to time
determine.

                  Section 3.7 Treasurer. Except as otherwise directed by the
Trustees, the Treasurer shall have the general supervision of the monies, funds,
securities, notes receivable and other valuable papers and documents of the
Trust, and shall have and exercise under the supervision of the Trustees and of
the President all powers and duties normally incident to his office. He may
endorse for deposit or collection all notes, checks and other instruments
payable to the Trust or to its order. He shall deposit all funds of the Trust in
such depositories as the Trustee shall designate. He shall be responsible for
such disbursement of the funds of the Trust as may be ordered by the Trustees or
the President. He shall keep accurate account of the books of the Trust's
transactions which shall be the property of the Trust, and which together with
all other property of the Trust in his possession, shall be subject at all times
to the inspection and control of the Trustees. Unless the Trustees shall
otherwise determine, the Treasurer shall be the principal accounting officer of
the Trust and shall also be the principal financial officer of the Trust. He
shall have such other duties and authorities as the Trustees shall from time to
time determine. Notwithstanding anything to the contrary herein contained, the
Trustees may authorize any adviser, administrator, manager or transfer agent to
maintain bank accounts and deposit and disburse funds of the Trust.

                  Section 3.8 Other Officers and Duties. The Trustees may elect
such other officers and assistant officers as they shall from time to time
determine to be necessary or desirable in order to conduct the business of the
Trust. Assistant officers shall act generally in the absence of the officer whom
they assist and shall assist that officer in the duties of his office. Each
officer, employee and agent of the Trust shall have such other duties and
authority as may be conferred upon him by the Trustees or delegated to him by
the President.


                                       4

<PAGE>

                                   ARTICLE IV

                                  Miscellaneous

                  Section 4.1 Depositories. In accordance with Section 8.1 of
the Declaration, the funds of the Trust shall be deposited in such depositories
as the Trustees shall designate and shall be drawn out on checks, drafts or
other orders signed by such officer, officers, agent or agents (including the
adviser, administrator or manager), as the Trustees may from time to time
authorize.

                  Section 4.2 Signatures. All contracts and other instruments
shall be executed on behalf of the Trust by its properly authorized officers,
agent or agents, as provided in the Declaration or By-Laws or as the Trustees
may from time to time by resolution provide.

                  Section 4.3 Seal. The seal of the Trust, if any, may be
affixed to any instrument, and the seal and its attestation may be lithographed,
engraved or otherwise printed on any document with the same force and effect as
if it had been imprinted and affixed manually in the same manner and with the
same force and effect as if done by a Massachusetts business corporation.

                                   ARTICLE V

                                 Stock Transfers

                  Section 5.1 Transfer Agents, Registrars and the Like. As
provided in Section 4.3 of the Declaration, the Trustees shall have authority to
employ and compensate such transfer agents and registrars with respect to the
Shares of the Trust as the Trustees shall deem necessary or desirable. In
addition, the Trustees shall have power to employ and compensate such dividend
disbursing gents, warrant agents and agents for the reinvestment of dividends as
they shall deem necessary or desirable. Any of such agents shall have such power
and authority as is delegated to any of them by the Trustees.

                  Section 5.2 Transfer of Shares. The Shares of the Trust shall
be transferable on the books of the Trust only upon delivery to the Trustees or
a transfer agent of the Trust of proper documentation as provided in Section 6.6
of the Declaration. The Trust, or its transfer agents, shall be authorized to
refuse any transfer unless and until presentation of such evidence as may be
reasonably required to show that the requested transfer is proper.

                  Section 5.3 Registered Shareholders. The Trust may deem and
treat the holder of record of any Shares the absolute owner thereof for all
purposes and shall not be required to take any notice of any right or claim of
right of any other person.



                                       5

<PAGE>

                                   ARTICLE VI

                              Amendment of By-Laws

                  Section 6.1 Amendment and Repeal of By-Laws. In accordance
with Section 3.8 of the Declaration, the Trustees shall have the power to alter,
amend or repeal the By-Laws or adopt new By-Laws at any time; provided, however,
that By-Laws adopted by the Shareholders may, if such By-Laws so state, be
altered, amended or repealed only by the Shareholders and not the Trustees.
Action by the Trustees with respect to the By-Laws shall be taken by an
affirmative vote of a majority of the Trustees. The Trustees shall in no event
adopt By-Laws which are in conflict with the Declaration, and any apparent
inconsistency shall be construed in favor of the related provisions in the
Declaration.

                  The Declaration of Trust establishing the Van Kampen Merritt
Quality Municipal Trust, dated as of July 19, 1991, a copy of which, together
with all amendments thereto, is on file in the office of the Secretary of the
Commonwealth of Massachusetts, provides that the name Van Kampen Merritt Quality
Municipal Trust refers to the Trustees under the Declaration collectively as
Trustees, but not as individuals or personally; and no Trustee, Shareholder,
officer, employee or agent of the Van Kampen Merritt Quality Municipal Trust
shall be held to any personal liability, nor shall resort be had to their
private property for the satisfaction of any obligation or claim or otherwise in
connection with the affairs of said Van Kampen Merritt Quality Municipal Trust
but the Trust Property only shall be liable.






                                       6
<PAGE>


                              ARTICLES OF AMENDMENT

     FIRST: On April 21, 2005, the Board of Trustees of each of the closed-end
funds listed in Exhibit A hereto (each a "Fund"), pursuant to the provisions of
Section 6.1 of the By-Laws of each Fund, authorized an amendment to each Fund's
By-Laws to allow for certain telephone and electronic voting of proxies.

     SECOND: Pursuant to the provisions of Section 6.1 of the By-Laws, the
following amendments to the By-Laws have been duly adopted and approved by a
majority of the Trustees of the Fund.

     Section 1.2 of each Fund's By-Laws is hereby amended to add the following
sentence at the end of such Section 1.2:

The placing of a shareholder's name on a proxy pursuant to telephone or
electronically transmitted instructions obtained pursuant to procedures
reasonably designed to verify that such instructions have been authorized by
such shareholder shall constitute execution of such proxy by or on behalf of
such shareholder.


<PAGE>
                                    Exhibit A

Van Kampen Municipal Income Trust
Van Kampen California Municipal Trust
Van Kampen High Income Trust
Van Kampen High Income Trust II
Van Kampen Investment Grade Municipal Trust
Van Kampen Senior Loan Fund
Van Kampen Senior Income Trust
Van Kampen Municipal Trust
Van Kampen California Quality Municipal Trust
Van Kampen Florida Quality Municipal Trust
Van Kampen New York Quality Municipal Trust
Van Kampen Ohio Quality Municipal Trust
Van Kampen Trust for Insured Municipals
Van Kampen Trust for Investment Grade Municipals
Van Kampen Trust for Investment Grade California Municipals
Van Kampen Trust for Investment Grade Florida Municipals
Van Kampen Trust for Investment Grade New Jersey Municipals
Van Kampen Trust for Investment Grade New York Municipals
Van Kampen Municipal Opportunity Trust
Van Kampen Advantage Municipal Income Trust
Van Kampen Strategic Sector Municipal Trust
Van Kampen Value Municipal Income Trust
Van Kampen California Value Municipal Income Trust
Van Kampen Massachusetts Value Municipal Income Trust
Van Kampen New York Value Municipal Income Trust
Van Kampen Ohio Value Municipal Income Trust
Van Kampen Municipal Opportunity Trust II
Van Kampen Advantage Municipal Income Trust II
Van Kampen Select Sector Municipal Trust
Van Kampen Pennsylvania Value Municipal Income Trust
Van Kampen Trust for Investment Grade Pennsylvania Municipals
Van Kampen Pennsylvania Quality Municipal Trust
Van Kampen Advantage Pennsylvania Municipal Income Trust







</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(5)(A)
<SEQUENCE>4
<FILENAME>c93084a1exv99wx5yxay.txt
<DESCRIPTION>SPECIMEN SHARE CERTIFICATE - COMMON SHARES
<TEXT>
<PAGE>
                                                                    EXHIBIT 5(a)


=================================GRAPHIC OMITTED================================



            SPECIMEN                                        SPECIMEN
             NBN Co                                          NBN Co

          COMMON SHARES                                  COMMON SHARES
             NUMBER

          ============                                   =============
          VKQ
          ============                                   =============

SEE REVERSE FOR CERTAIN DEFINITIONS

                                                         CUSIP 920919-107

THIS CERTIFICATE IS TRANSFERABLE
IN BOSTON OR IN NEW YORK CITY

                           Van Kampen Municipal Trust

         Organized Under the Laws of the Commonwealth of Massachusetts
- --------------------------------------------------------------------------------
This certifies that










is the owner of
- --------------------------------------------------------------------------------
      Common Shares of beneficial interest of $0.01 par value per share of

                           Van Kampen Municipal Trust

                              CERTIFICATE OF STOCK

(hereinafter called the "Trust") transferable on the books of the Trust by the
holder hereof in person or by duly authorized attorney upon surrender of this
certificate properly endorsed. This certificate is not valid unless
countersigned by the Transfer Agent and registered by the Registrar.

     Witness the facsimile seal of the Trust and the facsimile signatures of
its duly authorized officers.


                           Van Kampen Municipal Trust
                                 MASSACHUSETTS
                                      SEAL
                                     TRUST
                                       *



Dated:

/s/ Stefanie V. Chang Yu                          /s/ Ronald E. Robison
Vice President and                                Executive Vice President
Secretary


                         COUNTERSIGNED AND REGISTERED:
                              STATE STREET BANK AND TRUST COMPANY
                                                                TRANSFER AGENT
                                                                AND REGISTRAR,

                         BY:




                                                            Authorized Signature

                                                  (c) NORTHERN BANK NOTE COMPANY
================================================================================

<PAGE>
     THE TRUST WILL FURNISH WITHOUT CHARGE TO EACH SHAREHOLDER WHO SO REQUESTS
A STATEMENT OF THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE,
PARTICIPATING, OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF SHARES OR
SERIES THEREOF AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH
PREFERENCES AND/OR RIGHTS. ANY SUCH REQUEST SHOULD BE MADE TO THE SECRETARY OF
THE TRUST.

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

     The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:


TEN COM- as tenants in common           UNIF GIFT MIN ACT-______Custodian_______
                                                          (Cust)         (Minor)

TEN ENT- as tenants by the entireties
                                                   under Uniform Gifts to Minors
 JT TEN- as joint tenants with                     Act _________________________
         right of survivorship and                             (State)
         not as tenants in common

     Additional abbreviations may also be used though not in the above list.

         For value received, ___________ hereby sell, assign and transfer unto
______________________________________________________________________________

PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
- ------------------------------------

______________________________________________________________________________

______________________________________________________________________________
             PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________ Shares
of the Trust represented by the within Certificate, and do hereby irrevocably
constitute and appoint _________________________________________________________
______________________________________________________________________ Attorney
to transfer the said shares on the books of the within-named Trust with full
power of substitution in the premises.

Dated, ________________

                               X _______________________________________________
                               NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST
                               CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE
                               OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT
                               ALTERATION OR ENLARGEMENT, OR ANY CHANGE
                               WHATEVER.

<PAGE>
SIGNATURE(S) GUARANTEED:  _____________________________________
                          THE SIGNATURE(S) SHOULD BE GUARANTEED
                          BY AN ELIGIBLE GUARANTOR INSTITUTION,
                          (BANKS, STOCKBROKERS, SAVINGS AND
                          LOAN ASSOCIATIONS AND CREDIT UNIONS
                          WITH MEMBERSHIP IN AN APPROVED
                          SIGNATURE GUARANTEE MEDALLION
                          PROGRAM), PURSUANT TO S.E.C. RULE
                          17Ad-15.
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(5)(B)
<SEQUENCE>5
<FILENAME>c93084a1exv99wx5yxby.txt
<DESCRIPTION>SPECIMEN SHARE CERTIFICATE - PREFERRED SHARES
<TEXT>
<PAGE>
                                                                    EXHIBIT 5(b)


                                    Specimen

Certificate                                            Number of
  Number                                                Shares
    1                                                    3,000

                           Van Kampen Municipal Trust
                   Organized as a Massachusetts Business Trust
                            Auction Preferred Shares
                         $25,000 Liquidation Preference

                                                                     Cusip No.

     This certifies that Cede & Co. is the owner of three thousand (3,000) fully
paid and non-assessable preferred shares of beneficial interest, par value  $.01
per shares, liquidation preference $25,000 per share, designated Auction
Preferred Shares, of Van Kampen Municipal Trust (the "Fund") transferable only
on the books of the Fund by the holder hereof in person by Attorney upon
surrender of this Certificate properly endorsed. This Certificate is not valid
unless countersigned by the registrar and transfer agent.

     In witness whereof the said Fund has caused this Certificate to be signed
by its duly authorized officer and its corporate seal to be hereunto affixed
this 18th day of April, A.D. 2005.

      Deutsche Bank                                  Van Kampen Municipal Trust
    As Registrar and
     Transfer Agent

                         Stefanie V. Chang Yu         Ronald E. Robison
- ---------------------    --------------------------   ------------------------
Authorized Signature     Vice President & Secretary   Executive Vice President


     TRANSFER OF THE SHARES REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE
RESTRICTIONS SPECIFIED IN THE CERTIFICATE OF VOTE OF THE FUND AND IN THE
MASTER PURCHASER'S LETTER, COPIES OF WHICH ARE FILED WITH THE SECRETARY OF THE
FUND.

     THE FUND WILL FURNISH WITHOUT CHARGE TO EACH SHAREHOLDER WHO SO REQUESTS
THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR
OTHER SPECIAL RIGHTS OF EACH CLASS OF SHARES OR SERIES THEREOF WHICH IT IS
AUTHORIZED TO ISSUE AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH
PREFERENCES AND/OR RIGHTS. SUCH REQUEST SHOULD BE ADDRESSED TO THE SECRETARY OF
THE FUND.

     NOTICE IS HEREBY GIVEN THAT THIS CERTIFICATE REPRESENTING THE AUCTION
PREFERRED SHARES, AND TO THE OBLIGATIONS ARISING OUT OF THE ISSUANCE AND SALE
OF THE AUCTION PREFERRED SHARES, ARE NOT BINDING UPON ANY OF THE TRUSTEES,
OFFICERS OR SHAREHOLDERS INDIVIDUALLY BUT ARE BINDING ONLY UPON THE ASSETS AND
PROPERTY OF THE FUND.

     For value received,  ________ does hereby sell, assign and transfer unto
____________ shares of the Auction Preferred Shares,









<PAGE>
represented by the within Certificate, and does hereby irrevocably constitute
and appoint __________ Attorney to transfer the said shares of beneficial
interest on the books of the within named Fund with full power of substitution
in the premises.



Date:   ___________, 20

In presence of



________________________________     _____________________________________

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(6)(A)
<SEQUENCE>6
<FILENAME>c93084a1exv99wx6yxay.txt
<DESCRIPTION>INVESTMENT ADVISORY AGREEMENT
<TEXT>
<PAGE>

                                                                    EXHIBIT 6(a)

                         INVESTMENT ADVISORY AGREEMENT

THIS INVESTMENT ADVISORY AGREEMENT, dated as of May 31, 1997 (the "Agreement"),
by and between VAN KAMPEN AMERICAN CAPITAL MUNICIPAL TRUST (the "Fund"), a
Massachusetts business trust (the "Trust"), and VAN KAMPEN AMERICAN CAPITAL
INVESTMENT ADVISORY CORP. (the "Adviser"), a Delaware corporation.

1. (a) RETENTION OF ADVISER BY FUND. Subject to the terms and conditions set
forth herein, the Fund hereby employs the Adviser to act as the investment
adviser for and to manage the investment and reinvestment of the assets of the
Fund in accordance with the Fund's investment objective and policies and
limitations, and to administer its affairs to the extent requested by, and
subject to the review and supervision of, the Board of Trustees of the Fund for
the period and upon the terms herein set forth. The investment of funds shall be
subject to all applicable restrictions of applicable law and of the Declaration
of Trust and By-laws of the Trust, and resolutions of the Board of Trustees of
the Fund as may from time to time be in force and delivered or made available to
the Adviser.

   (b) ADVISER'S ACCEPTANCE OF EMPLOYMENT. The adviser accepts such employment
and agrees during such period to render such services, to supply investment
research and portfolio management (including without limitation the selection of
securities for the Fund to purchase, hold or sell and the selection of brokers
through whom the Fund's portfolio transactions are executed, in accordance with
the affairs of the Fund, to furnish offices and necessary facilities and
equipment to the Fund, to provide administrative services for the Fund, to
render periodic reports to the Board of Trustees of the Fund, and to permit any
of its officers or employees to serve without compensation as trustees or
officers of the Fund if elected to such positions.

   (c) ESSENTIAL PERSONNEL. For a period of one year commencing on the effective
date of this Agreement, the Adviser and the Fund agree that the retention of (i)
the chief executive officer, president, chief financial officer and secretary of
the Adviser and (ii) each director, officer and employee of the Adviser or any
of its Affiliates (as defined in the Investment Company Act of 1940, as amended
(the "1940 Act")) who serves as an officer of the Fund (each person referred to
in (i) or (ii) hereinafter being referred to as an "Essential Person"), in his
or her current capacities, is in the best interest of the Fund and the Fund's
shareholders. In connection with the Adviser's acceptance of employment
hereunder, the Adviser hereby agrees and covenants for itself and on behalf of
its Affiliates that neither the Adviser nor any of its Affiliates shall make any
material or significant personnel changes or replace or seek to replace any
Essential Person or cause to be replaced any Essential Person, in each case
without first informing the Board of Trustees of the Fund in a timely manner. In
addition, neither the Adviser nor any Affiliate of the Adviser shall change or
seek to change or cause to be changed, in any material respect, the duties and
responsibilities of any Essential Person, in each case without first informing
the Board of Trustees of the Fund in a timely manner.



<PAGE>

   (d) INDEPENDENT CONTRACTOR. The Advisor shall be deemed to be an independent
contractor under this Agreement and, unless otherwise expressly provided or
authorized, shall have no authority to act for or represent the Fund in any way
or otherwise be deemed as agent of the Fund.

   (e) NON-EXCLUSIVE AGREEMENT. The services of the Adviser to the Fund under
this Agreement are not to be deemed exclusive, and the Adviser shall be free to
render similar services or other services to others so long as its services
hereunder are not impaired thereby.

2. (a) FEE. For the services and facilities described in Section 1, the Fund
will accrue daily and pay to the Advisor at the end of each calendar month an
investment management fee equal to seventy one-hundredths of one percent (.70 of
1%) of the average daily managed assets of the Fund (which for purposes of
determining such fee, shall mean the average daily value of the Fund, minus the
sum of accrued liability other than the aggregate amount of any borrowings
undertaken by the Fund).

   (b) DETERMINATION OF NET ASSET VALUE. The net asset value of the Fund shall
be calculated as of the close of the New York Stock Exchange on the last day the
Exchange is open for trading in each calendar week or such other time or times
as the trustees may determine in accordance with the provisions of applicable
law and the Declaration of Trust and By-Laws of the Trust, and resolutions of
the Board of Trustees of the Fund as from time to time in force. For the purpose
of the foregoing computations, on each such day when net asset value is not
calculated, the net asset value of a share of beneficial interest of the Fund
shall be deemed to be the net asset value of such share as of the close of
business of the last day on which such calculation was made.

   (c) PRORATION. For the month and year in which this Agreement becomes
effective or terminates, there shall be an appropriate proration of the
Adviser's fee on the basis of the number of days that the Agreement is in effect
during such month and year, respectively.

3. EXPENSES. In addition to the fee of the Adviser, the Fund shall assume and
pay any expenses for services rendered by a custodian for the safekeeping of the
Fund's securities or other property, for keeping its books of account, for any
other charges of the custodian and for calculating the net asset value of the
Fund as provided above. The Adviser shall not be required to pay, and the Fund
shall assume and pay, the charges and expenses of its operations, including
compensation of the trustees (other than those who are interested persons of the
Adviser), charges and expenses of independent accountants, of legal counsel and
of any transfer or dividend disbursing agent, costs of acquiring and disposing
of portfolio securities, cost of listing shares of the New York Stock Exchange
or other exchange, interest (if any) on obligations incurred by the Fund, costs
of share certificates, membership dues in the Investment Company Institute or
any similar organization, costs of reports and securities laws, miscellaneous
expenses and all taxes and fees to federal, state or other governmental agencies
on account of the registration of securities issues by the Fund, filing of
corporate documents or otherwise. The Fund shall not pay or incur any obligation
for any management or administrative expenses for which


                                       2

<PAGE>


the Fund intends to seek reimbursement from the Adviser without first obtaining
the written approval of the Adviser. The Adviser shall arrange, if desired by
the Fund, for officers or employees of the Adviser to serve, without
compensation from the Fund, as trustees, officers or agents of the Fund if duly
elected or appointed to such positions and subject to their individual consent
and to any limitations imposed by the law.

4. INTERESTED PERSONS. Subject to applicable statutes and regulations, it is
understood that trustees, officers, shareholders and agents of the Fund are or
may be interested in the Adviser as directors, officers, shareholders, agents or
otherwise and that the directors, officers, shareholders and agents of the
Adviser may be interested in the Fund as trustees, officers, shareholders,
agents or otherwise.

5. LIABILITY. The Adviser shall not be liable for any error of judgment or of
law, or for any loss suffered by the Fund in connection with the matters in
which this Agreement relates, except a loss resulting from willful misfeasance,
bad faith or gross negligence on the part of the Adviser in the performance of
its obligations and duties, or by reason of its reckless disregard of its
obligations and duties under this Agreement.

6. (a) TERM. This Agreement shall become effective on the date hereof and shall
remain in full force until May 31, 1999 unless sooner terminated as hereinafter
provided. This Agreement shall continue in force from year to year thereafter,
but only for so long as such continuance is specifically approved as least
annually, in the manner required by the 1940 Act.

   (b) TERMINATION. This Agreement shall automatically terminate in the event of
its assignment. This Agreement may be terminated at any time without the payment
of any penalty by the Fund or by the Adviser on sixty (60) days written notice
to the other party. The Fund may effect termination by action of the Board of
Trustees or by vote of a majority of the outstanding shares of stock of the
Fund, accompanied by appropriate notice. This Agreement may be terminated at any
time without the payment of any penalty and without advance notice by the Board
of Trustees or by vote of a majority of the outstanding shares of the Fund in
the event that it shall have been established by a court of competent
jurisdiction that the Adviser or any officer or director of the Adviser has
taken any action which results in a breach of the covenants of the Adviser set
forth herein.

   (c) PAYMENT UPON TERMINATION. Termination of this Agreement shall not affect
the right of the Adviser to receive payment on any unpaid balance of the
compensation described in Section 2 earned prior to such termination.

7. SEVERABILITY. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder shall not
thereby affected.

8. NOTICES. Any notice under this Agreement shall be in writing, addressed and
delivered or mailed, postage prepaid, to the other party at such address as such
other party may designate for the receipt of such notice.

                                       3

<PAGE>

9. DISCLAIMER. The Adviser acknowledges and agrees that, as provided by Section
5.5 of the Declaration of Trust of the Trust, the shareholders, trustees,
officers, employees and other agents of the Trust and the Fund shall not
personally be bound by or liable hereunder, nor shall resort be had to their
private property for the satisfaction of any obligation or claim hereunder.

10. GOVERNING LAW. All questions concerning the validity, meaning and effect of
this Agreement shall be determined in accordance with the laws (without giving
effect to the conflict-of-law principles thereof) of the State of Delaware
applicable to contracts made and to be performed in that state.

11. NAME. In connection with its employment hereunder, the Adviser hereby agrees
and covenants not to change its name without the prior consent of the Board of
Trustees of the Fund.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their officers designated below on the day and year first above written.

VAN KAMPEN AMERICAN CAPITAL         VAN KAMPEN AMERICAN CAPITAL
INVESTMENT ADVISORY CORP.           MUNICIPAL TRUST

By:    /s/ Dennis J. McDonnell      By:      /s/ Ronald A. Nyberg
     ---------------------------            ----------------------------------
Name:  Dennis J. McDonnell          Name:    Ronald A. Nyberg
Title: President                    Title:   Secretary


                                       4

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(6)(B)
<SEQUENCE>7
<FILENAME>c93084a1exv99wx6yxby.txt
<DESCRIPTION>AMENDMENT TO THE INVESTMENT ADVISORY AGREEMENT
<TEXT>
<PAGE>

                                                                    EXHIBIT 6(b)

                              AMENDMENT NUMBER ONE
                                     TO THE
                         INVESTMENT ADVISORY AGREEMENT

This Amendment Number One, dated November 1, 2004, to the Investment Advisory
Agreement, dated May 31, 1997 (the "Agreement"), by and between Van Kampen
Municipal Trust (the "Fund"), a Massachusetts business trust (the "Trust"), and
Van Kampen Asset Management (the "Adviser," successor in interest of Van Kampen
Investment Advisory Corp.), a Delaware statutory trust, hereby amends the terms
and conditions of the Agreement in the manner specified herein.

                               W I T N E S S E T H

WHEREAS, the Board of Trustees of the Fund at a meeting held on September 23,
2004 has approved a reduction in the investment management fee payable by the
Fund to the Adviser; and

WHEREAS, the parties desire to amend and restate Section 2.(a) of the Agreement
relating to the investment management fee.

NOW THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements hereinafter contained, the parties hereby agree to amend the
Agreement, as follows:

Section 2.(a) of the Agreement is hereby deleted in its entirety and replaced
with the following:

2.(a) Fee. For the services and facilities described in Section 1, the Fund will
accrue daily and pay to the Adviser at the end of each calendar month an
investment management fee equal to 0.55% of the average daily managed assets of
the Fund (which for purposes of determining such fee, shall mean the average
daily value of the Fund, minus the sum of accrued liability other than the
aggregate amount of any borrowings undertaken by the Fund).

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
the day and year first above written.

VAN KAMPEN MUNICIPAL TRUST                  VAN KAMPEN ASSET MANAGEMENT

By:     /s/ Ronald E. Robison               By:    /s/ Edward C. Wood, III
     -----------------------------------         ------------------------------
       Ronald E. Robison                           Edward C. Wood, III
       Executive Vice President                    Managing Director
       and Principal Executive Officer
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(8)(A)
<SEQUENCE>8
<FILENAME>c93084a1exv99wx8yxay.txt
<DESCRIPTION>FORM OF AMENDED AND RESTATED DEFERRED COMPENSATION PLAN
<TEXT>
<PAGE>
                                                                    EXHIBIT 8(a)

                                     FORM OF
                              AMENDED AND RESTATED
                         DEFERRED COMPENSATION AGREEMENT

      AGREEMENT, made on this 11th day of August, 1994, and as amended and
restated as of [Date], by and between each of the funds listed on Schedule A
attached hereto as may be amended from time to time, each a registered
investment company having its principal offices at 1 Parkview Plaza, P.O. Box
5555, Oakbrook Terrace, Illinois 60181-5555 (collectively the "Funds" or
individually the "Fund"), and [Trustee Name], residing at [Trustee Address] (the
"Trustee").

      WHEREAS, the Fund and the Trustee desire to enter into an agreement
whereby the Fund will provide to the Trustee a vehicle under which the Trustee
can defer receipt of trustees' fees payable by the Fund.

      NOW, THEREFORE, in consideration of the mutual covenants and obligations
set forth in this Agreement, the Fund and the Trustee hereby agree as follows:

1.    DEFINITION OF TERMS AND CONSTRUCTION

      1.1 Definitions. Unless a different meaning is plainly implied by the
context, the following terms as used in this Agreement shall have the following
meanings:

            (a) "Beneficiary" shall mean such person or persons designated
pursuant to Section 4.3 hereof to receive benefits after the death of the
Trustee.

            (b) "Board of Trustees" shall mean the Board of Trustees of the
Fund.

            (c) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time, or any successor statute.

            (d) "Compensation" shall mean the amount of trustee's fees paid by
the Fund to the Trustee during a Deferral Year prior to reduction for
Compensation Deferrals made under this Agreement.

            (e) "Compensation Deferral" shall mean the amount or amounts of the
Trustee's Compensation deferred under the provisions of Section 3 of this
Agreement.

            (f) "Deferral Account" shall mean the account maintained to reflect
the Trustee's Compensation Deferral made pursuant to Section 3 hereof and any
other credits or debits thereto.

<PAGE>

            (g) "Deferral Year" shall mean each calendar year during which the
Trustee makes, or is entitled to make, a Compensation Deferral under Section 3
hereof.

            (h) "Valuation Date" shall mean any day upon which the Fund makes a
valuation of the Deferral Account and shall, at a minimum, be the last business
day of each calendar quarter.

      1.2 Plurals and Gender. Where appearing in this Agreement the singular
shall include the plural and the masculine shall include the feminine, and vice
versa, unless the context clearly indicates a different meaning.

      1.3 Headings. The headings and subheadings in this Agreement are inserted
for the convenience of reference only and are to be ignored in any construction
of the provisions hereof.

2.    PERIOD DURING WHICH COMPENSATION DEFERRALS ARE PERMITTED

      2.1 Commencement of Compensation Deferrals. The Trustee may elect, on a
form provided by, and submitted to, the President of the Fund, to commence
Compensation Deferrals under Section 3 hereof for the period beginning on the
later of (i) the date this Agreement is executed or (ii) the date such form is
submitted to the President of the Fund.

      2.2 Termination of Deferrals. The Trustee shall not be eligible to make
Compensation Deferrals after the earlier of the following dates:

            (a) The date of which he ceases to serve as a Trustee of the Fund;
or

            (b) The effective date of the termination of this Agreement.

3.    COMPENSATION DEFERRALS

      3.1   Compensation Deferral Elections.

            (a) On or prior to the first day of any Deferral Year, the Trustee
may elect, on the form described in Section 2.1 hereof, to defer the receipt of
all or a portion of the Compensation for such Deferral Year. Such writing shall
set forth the amount of such Compensation Deferral (in whole percentage
amounts). Such election shall continue in effect for all subsequent Deferral
Years unless it is canceled or modified as provided below.

            (b) Compensation Deferrals shall be withheld from each

<PAGE>

payment of Compensation by the Fund to the Trustee based upon the percentage
amount elected by the Trustee under Section 3.1(a) hereof.

            (c) The Trustee may cancel or modify the amount of his Compensation
Deferrals on a prospective basis by submitting to the President of the Fund a
revised Compensation Deferral election form. Such change will be effective as of
the first day of the Deferral Year following the date such revision is submitted
to the President of the Fund.

      3.2   Valuation of Deferral Account.

            (a) The Fund shall establish a bookkeeping Deferral Account to which
will be credited an amount equal to the Trustee's Compensation Deferrals under
this Agreement. Compensation Deferrals shall be allocated to the Deferral
Account on the first business day following the date such Compensation Deferrals
are withheld from the Trustee's Compensation. The Deferral Account shall be
debited to reflect any distributions from such Account. Such debits shall be
debited to the Deferral Account as of the date such distributions are made.

            (b) As of each Valuation Date, income, gain and loss equivalents
(determined as if the Deferral Account is invested in the manner set forth under
Section 3.3 below) attributable to the period following the next preceding
Valuation Date shall be credited to and/or deducted from the Trustee's Deferral
Account.

      3.3   Investment of Deferral Account Balance.

            (a) (1) The Trustee may select, from various options made available
by the Fund, the investment media in which all or part of his Deferral Account
shall be deemed to be invested.

            (2) The Trustee shall make an investment designation on a form
provided by the President of the Fund which shall remain effective until another
valid direction has been made by the Trustee as herein provided. The Trustee may
amend the investment designation as of the end of each calendar quarter by
giving written direction to the President of the Fund at least 30 days prior to
the end of such calendar quarter. A timely change in a Trustee's investment
designation shall become effective on the first day of the calendar quarter
following receipt by the President of the Fund.

            (3) The investment media deemed to be made available to the Trustee,
and any limitation on the maximum or minimum percentages of the Trustee's
Deferral Account that may be invested in any particular medium, shall be the
same as from time to time communicated to the Trustee by the President of the
Fund.

            (b) Except as provided below, the Trustee's Deferral Account shall
be deemed to be invested in accordance with the investment designations,

<PAGE>

provided such designations conform to the provisions of this Section. If:

                  (1) the Trustee does not furnish the President of the Fund
      with written investment instructions,

                  (2) the written investment instructions from the Trustee are
      unclear, or

                  (3) less than all of the Trustee's Deferral Account is covered
      by such written investment instructions,

then the Trustee's Deferral Account shall be deemed to be invested in the Fund
until such time as the Trustee shall provide the President of the Fund with
complete investment instructions. Notwithstanding the above, the Board of
Directors, in its sole discretion, may disregard the Trustee's election and
determine that all Compensation Deferrals shall be deemed to be invested in the
Fund.

      The Fund shall provide an annual statement to the Trustee showing such
information as is appropriate, including the aggregate amount in the Deferral
Account, as of a reasonably current date.

4.    DISTRIBUTIONS FROM DEFERRAL ACCOUNT

      4.1 In General. Distributions from the Trustee's Deferral Account shall be
paid in cash, in generally equal annual installments over a period of five (5)
years beginning on the date of the Trustee's retirement or disability, except
that the Board of Directors may, in its sole discretion, accelerate or, with the
consent of the Trustee, extend the distribution of such Deferral Account.
Notwithstanding the foregoing, in the event of the liquidation, dissolution or
winding up of the Fund or the distribution of all or substantially all of the
Fund's assets and property relating to one or more series of its shares to the
shareholders (for this purpose a sale, conveyance or transfer of the Fund's
assets to a trust, partnership, association or corporation in exchange for cash,
shares or other securities with the transfer being made subject to, or with the
assumption by the transferee of, the liabilities of the Fund shall not be deemed
a termination of the Fund or such a distribution), all unpaid amounts in the
Deferral Account as of the effective date thereof shall be paid in a lump sum on
such effective date.

      4.2 Death Prior to Distribution of Deferral Account. Upon the death of the
Trustee prior to the commencement of the distribution of the amounts credited to
the Deferral Account, the Deferral Account shall be distributed to the
Beneficiary over a period of five (5) years beginning as soon as practicable
after the Trustee's death. In the event of the death of the Trustee after the
commencement of such distribution, but prior to the complete distribution of the
Deferral Account, the balance of the amounts in the Deferral Account shall be
distributed to the Beneficiary over the remaining period during which such
amounts were distributable to the Trustee under Section 4.1 hereof. In the event
the Trustee survives the designated Beneficiary, the balance of such

<PAGE>

Deferral Account shall be paid in a lump sum to such Trustee's estate.
Notwithstanding the above, the Board of Directors may, in its sole discretion,
accelerate or, with the consent of the Beneficiary or the Trustee's estate, as
applicable, extend the distribution of the Deferral Account.

      4.3 Designation of Beneficiary. For purposes of Section 4.2 hereof, the
Trustee's Beneficiary shall be the person or persons so designated by the
Trustee in a written instrument submitted to the President of the Fund. In the
event the Trustee fails to properly designate a Beneficiary, the balance of such
Trustee's Deferred Account shall be paid in a lump sum to such Trustee's estate.

      4.4 Payments Due Missing Persons. The Fund shall make a reasonable effort
to locate all persons entitled to benefits under this Agreement. However,
notwithstanding any provisions of this Agreement to the contrary, if, after a
period of five (5) years from the date such benefit shall be due, any such
persons entitled to benefits have not been located, their rights under this
Agreement shall stand suspended. Before this provision becomes operative, the
Fund shall send a certified letter to all such persons to their last known
address advising them that their benefits under this Agreement shall be
suspended. Any such suspended amounts shall be held by the Fund for a period of
three (3) additional years (or a total of eight (8) years from the time the
benefits first become payable) and thereafter, if unclaimed, such amounts shall
be forfeited.

5.    AMENDMENTS AND TERMINATION

      5.1   Amendments.

            (a) The Fund and the Trustee may, by a written instrument signed by
both such parties, amend this Agreement at any time and in any manner.

            (b) The Fund reserves the right to amend, in whole or in part, and
in any manner, any or all of the provisions of this Agreement by action of its
Board of Trustees for the purposes of complying with any provision of the Code
or any other technical or legal requirements, provided that:

                  (1) No such amendment shall make it possible for any part of
the Trustee's Deferral Account to be used for, or diverted to, purposes other
than for the exclusive benefit of the Trustee or the Beneficiaries, except to
the extent otherwise provided in this Agreement; and

                  (2) No such amendment may reduce the amount of the Trustee's
Deferral Account as of the effective date of such amendment.

      5.2 Termination. The Trustee and the Fund may, by written instrument
signed by both such parties, terminate this Agreement at any time. The rights of
the

<PAGE>

Trustee to the Deferral Account shall become payable as of the Valuation Date
next following the effective date of the termination of this Agreement.

6.    MISCELLANEOUS.

      6.1   Rights of Creditors.

                  (a) This Agreement is unfunded. Neither the Trustee nor any
other persons shall have any interest in any specific asset or assets of the
Fund by reason of any Deferral Account hereunder, nor any rights to receive
distribution of the Deferral Account except and as to the extent expressly
provided hereunder. The Fund shall not be required to purchase, hold or dispose
of any investments pursuant to this Agreement; however, if in order to cover its
obligations hereunder the Fund elects to purchase any investments the same shall
continue for all purposes to be a part of the general assets and property of the
Fund, subject to the claims of its general creditors and no person other than
the Fund shall by virtue of the provisions of this Agreement have any interest
in such assets other than an interest as a general creditor.

                  (b) The rights of the Trustee and the Beneficiaries to the
amounts held in the Deferral Account are unsecured and shall be subject to the
creditors of the Fund. With respect to the payment of amounts held under the
Deferral Account, the Trustee and the Beneficiaries have the status of unsecured
creditors of the Fund. This Agreement is executed on behalf of the Fund by an
officer of the Fund as such and not individually. Any obligation of the Fund
hereunder shall be an unsecured obligation of the Fund and not of any other
person.

      6.2 Agents. The Fund may employ agents and provide for such clerical,
legal, actuarial, accounting, advisory or other services as it deems necessary
to perform its duties under this Agreement. The Fund shall bear the cost of such
services and all other expenses it incurs in connection with the administration
of this Agreement.

      6.3 Liability and Indemnification. Except for its own gross negligence,
willful misconduct or willful breach of the terms of this Agreement, the Fund
shall be indemnified and held harmless by the Trustee against liability or
losses occurring by reason of any act or omission of the Fund or any other
person.

      6.4 Incapacity. If the Fund shall receive evidence satisfactory to it that
the Trustee or any Beneficiary entitled to receive any benefit under the
Agreement is, at the time when such benefit becomes payable, a minor, or is
physically or mentally incompetent to receive such benefit and to give a valid
release therefor, and that another person or an institution is then maintaining
or has custody of the Trustee or Beneficiary and that no guardian, committee or
other representative of the estate of the Trustee or Beneficiary shall have been
duly appointed, the Fund may make payment of such benefit otherwise payable to
the Trustee or Beneficiary to such other person or institution, including a
custodian under the Uniform Gifts to Minors Act or corresponding legislation
(such custodian shall be an adult, a guardian of the minor or a trust

<PAGE>

company), and the release of such other person or institution shall be a valid
and complete discharge for the payment of such benefit.

      6.5 Cooperation of Parties. All parties to this Agreement and any person
claiming any interest hereunder agree to perform any and all acts and execute
any and all documents and papers which are necessary or desirable for carrying
out this Agreement or any of its provisions.

      6.6 Governing Law. This Agreement is made and entered into in the State of
Illinois, and all matters concerning its validity, construction and
administration shall be governed by the laws of the State of Illinois.

      6.7 Nonguarantee of Trusteeship. Nothing contained in this Agreement shall
be construed as a contract or guarantee of the right of the Trustee to be, or
remain as, a trustee of the Fund or to receive any, or any particular rate of,
Compensation.

      6.8 Counsel. The Fund may consult with legal counsel with respect to the
meaning or construction of this Agreement or its obligations or duties hereunder
or with respect to any action or proceeding or any question of law, and it shall
be fully protected with respect to any action taken or omitted by it in good
faith pursuant to the advice of legal counsel.

      6.9 Spendthrift Provision. The Trustee's and Beneficiaries' interests in
the Deferral Account may not be anticipated, sold, encumbered, pledged,
mortgaged, charged, transferred, alienated, assigned nor become subject to
execution, garnishment or attachment, and any attempt to do so by any person
shall render the Deferral Amount immediately forfeitable.

      6.10 Notices. For purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered personally or mailed by United
States registered or certified mail, return receipt requested, postage prepaid,
or by nationally recognized overnight delivery service providing for a signed
return receipt, addressed to the Trustee at the home address set forth in the
Fund's records and to the Fund at the address set forth on the first page of
this Agreement, provided that all notices to the Fund shall be directed to the
attention of the President of the Fund or to such other address as either party
may have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon receipt.

      6.11 Entire Agreement. This Agreement contains the entire understanding
between the Fund and the Trustee with respect to the payment of non-qualified
elective deferred compensation by the Fund to the Trustee.

      6.12 Interpretation of Agreement. Interpretations of, and determinations
related to, this Agreement made by the Fund in good faith, including any
determinations of the amounts of the Deferral Account, shall be conclusive and
binding upon all parties;

<PAGE>

and the Fund shall not incur any liability to the Trustee for any such
interpretation or determination so made or for any other action taken by it in
connection with this Agreement in good faith.

      6.13 Successors and Assigns. This Agreement shall be binding upon, and
shall inure to the benefit of, the Fund and its successors and assigns and to
the Trustee and such Trustee's heirs, executors, administrators and personal
representatives.

      6.14 Severability. In the event any one or more provisions of this
Agreement are held to be invalid or unenforceable, such illegality or
unenforceability shall not affect the validity or enforceability of the other
provisions thereof and such other provisions shall remain in full force and
effect unaffected by such invalidity or unenforceability.

      6.15 Execution in Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
of which together shall constitute one and the same instrument.

      IN WITNESS WHEREOF, the parties hereto have caused this Deferred
Compensation Agreement to be executed as of the day and year first above
written.

                                                On behalf of the Funds listed on
                                                Schedule A attached hereto:

                                                By: ____________________________
                                                Name: __________________________
                                                Title: _________________________

                                On behalf of the Trustee listed on page 1 hereto

                                                       _________________________
                                                           [Trustee Name]

<PAGE>

                                                                      SCHEDULE A

                         DEFERRED COMPENSATION AGREEMENT
                         PARTICIPATING VAN KAMPEN FUNDS
                              AS OF APRIL 22, 1998
                           Updated as of July 1, 2003

Van Kampen Municipal Income Trust ("Municipal Income Trust")
Van Kampen California Municipal Trust ("California Municipal Trust")
Van Kampen High Income Trust ("High Income Trust")
Van Kampen High Income Trust II ("High Income Trust II")
Van Kampen Investment Grade Municipal Trust ("Investment Grade Municipal Trust")
Van Kampen Senior Loan Fund ("Senior Loan Fund") (f/k/a Van Kampen Prime Rate
Income Trust)
Van Kampen Municipal Trust ("Municipal Trust")
Van Kampen California Quality Municipal Trust ("California Quality Municipal
Trust")
Van Kampen Florida Quality Municipal Trust ("Florida Quality Municipal Trust")
Van Kampen New York Quality Municipal Trust ("New York Quality Municipal Trust")
Van Kampen Ohio Quality Municipal Trust ("Ohio Quality Municipal Trust")
Van Kampen Pennsylvania Quality Municipal Trust ("Pennsylvania Quality Municipal
Trust")
Van Kampen Trust for Insured Municipals ("Trust for Insured Municipals")
Van Kampen Trust for Investment Grade Municipals ("Trust for Investment Grade
Municipals")
Van Kampen Trust for Investment Grade California Municipals ("Trust for
Investment Grade California Municipals")
Van Kampen Trust for Investment Grade Florida Municipals ("Trust for Investment
Grade Florida Municipals")
Van Kampen Trust for Investment Grade New Jersey Municipals ("Trust for
Investment Grade New Jersey Municipals")
Van Kampen Trust for Investment Grade New York Municipals ("Trust for Investment
Grade New York Municipals")
Van Kampen Trust for Investment Grade Pennsylvania Municipals ("Trust for
Investment Grade Pennsylvania Municipals")
Van Kampen Municipal Opportunity Trust ("Municipal Opportunity Trust")
Van Kampen Advantage Municipal Income Trust ("Advantage Municipal Income Trust")
Van Kampen Advantage Pennsylvania Municipal Income Trust ("Advantage
Pennsylvania Municipal Income Trust")
Van Kampen Strategic Sector Municipal Trust ("Strategic Sector Municipal Trust")
Van Kampen Value Municipal Income Trust ("Value Municipal Income Trust")
Van Kampen California Value Municipal Income Trust ("California Value Municipal
Income Trust")
Van Kampen Massachusetts Value Municipal Income Trust ("Massachusetts Value
Municipal Income Trust")
Van Kampen New York Value Municipal Income Trust ("New York Value Municipal
Income Trust")
Van Kampen Ohio Value Municipal Income Trust ("Ohio Value Municipal Income
Trust")
Van Kampen Pennsylvania Value Municipal Income Trust ("Pennsylvania Value
Municipal Income Trust")
Van Kampen Municipal Opportunity Trust II ("Municipal Opportunity Trust II")
Van Kampen Advantage Municipal Income Trust II ("Advantage Municipal Income
Trust II")
Van Kampen Select Sector Municipal Trust ("Select Sector Municipal Trust")
Van Kampen Senior Income Trust ("Senior Income Trust")
Van Kampen Income Trust ("Income Trust")
Van Kampen Bond Fund ("Bond Fund")

Note: Van Kampen Exchange Fund does not have any deferred compensation
      arrangements or provides a retirement plan.
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(8)(B)
<SEQUENCE>9
<FILENAME>c93084a1exv99wx8yxby.txt
<DESCRIPTION>FORM OF RETIREMENT PLAN
<TEXT>
<PAGE>
                                                                    EXHIBIT 8(b)


                FORM OF RETIREMENT PLAN FOR EACH CLOSED END FUND

            Van Kampen ___________________________, a registered investment
company having its principal offices at 1 Parkview Plaza, Oakbrook Terrace,
Illinois 60181 (the "Fund"), has adopted this Retirement Plan, effective August
1, 1994 (the "Plan"), for its Eligible Trustees (as defined herein) in order to
recognize and reward the valued services provided by such trustees to the Fund.

1.    DEFINITION OF TERMS AND CONSTRUCTION

            1.1 Definitions. Unless a different meaning is plainly implied by
the context, the following terms as used in this Plan shall have the following
meanings:

                  (a) "Beneficiary" shall mean such person or persons designated
pursuant to Section 6.4 hereof to receive benefits after the death of the
Eligible Trustee.

                  (b) "Board of Trustees" shall mean the Board of Trustees of
the Fund.

                  (c) "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, or any successor statute.

                  (d) "Compensation" shall mean an amount equal to the annual
retainer (excluding any fees relating to attending meetings) paid to an Eligible
Trustee by the Fund during the Fund's fiscal year preceding such trustee's
termination of service.

                  (e) "Disability" shall have the meaning described in Section
5.1.

                  (f) "Early Retirement Benefit" shall have the meaning
described in Section 3.3.

                  (g) "Effective Date" shall mean August 1, 1994.

                  (h) "Effective Date Trustee" means a person who is a

                                       1
<PAGE>

trustee of the Fund on the Effective Date.

                  (i) "Eligible Retirement Age" shall have the meaning described
in Section 4.1.

                  (j) "Eligible Trustee" shall mean a person who: (i) is or
becomes a trustee of the Fund on or after the Effective Date, and (ii) is, prior
to the time of such trustee's termination of service, receiving trustee's fees
from the Fund.

                  (k) "Mandatory Retirement Age" shall have the meaning
described in Section 4.1.

                  (l) "Normal Distribution" shall have the meaning described in
Section 6.1.

                  (m) "Normal Retirement Benefit" shall have the meaning
described in Section 3.2.

                  (n) "Plan Committee" shall have the meaning described in
Section 8.2.

                  (o) "Service Requirement" shall have the meaning described in
Section 2.1.

                  (p) "Years of Service" shall mean full years of service as a
trustee for the Fund prior to such trustee's termination of service, including
such service performed prior to the adoption of this Plan.

            1.2 Plurals and Gender. Where appearing in this Plan the singular
shall include the plural and the masculine shall include the feminine, and vice
versa, unless the context clearly indicates a different meaning.

            1.3 Headings. The headings and subheadings in this Plan are inserted
for the convenience of reference only and are to be ignored in any construction
of the provisions hereof.

                                       2
<PAGE>

2.    SERVICE REQUIREMENT

            2.1 Service Requirement. Each Eligible Trustee that has completed
five (5) Years of Service as a trustee for the Fund shall be entitled to receive
retirement benefits from the Fund. An Eligible Trustee is not entitled to
benefits pursuant to the Plan merely because such trustee is an Eligible
Trustee; a trustee must meet the Years of Service requirement.

3.    RETIREMENT BENEFIT

            3.1 In General. The retirement benefit amount for an Eligible
Trustee meeting the Service Requirement is determined at the time of such
trustee's termination of service as a trustee. An Eligible Trustee terminating
service as a trustee to the Fund prior to attaining the Eligible Retirement Age
is eligible for the Early Retirement Benefit as described in Section 3.3. An
Eligible Trustee terminating service as a trustee to the Fund after attaining
the Eligible Retirement Age is eligible for the Normal Retirement Benefit as
described in Section 3.2. An Eligible Trustee terminating service as a trustee
to the Fund after the Mandatory Retirement Age forfeits and is not entitled to
any retirement benefit under the Plan.

            3.2 Normal Retirement Benefit. The Normal Retirement Benefit shall
be 50% of the Compensation and such benefit shall increase by 10% for each Year
of Service by such trustee in excess of five (5) Years of Service up to a
maximum amount of 100% of the Compensation for any trustee who has completed ten
(10) or more Years of Service.

<TABLE>
<CAPTION>
Years of Service            Percentage Of Compensation
- ----------------            --------------------------
<S>                         <C>
   Less than 5                           0%
        5                               50%
        6                               60%
        7                               70%
        8                               80%
        9                               90%
   10 or more                          100%
</TABLE>

                                       3
<PAGE>

            3.3 Early Retirement Benefit. The Early Retirement Benefit shall be
the Normal Retirement Benefit for such trustee based upon such trustee's Years
of Service at the time of such trustee's termination of service reduced by 3%
for each year prior to the Eligible Retirement Age.

4.    RETIREMENT AGE

            4.1 Retirement Age. The Eligible Retirement Age shall be upon
attaining the age of 60. A trustee may elect to continue to serve as a trustee
beyond the Eligible Retirement Age to a Mandatory Retirement Age of December
31st in the year such trustee reaches the age of 72; provided, however, that for
an Effective Date Trustee who was 67 years of age or more on the Effective Date
of the Plan, the Mandatory Retirement Age shall be December 31 of the year in
which such trustee attains the age of 75.

5.    DISABILITY

            5.1 Disability. Disability shall have the meaning as set forth in
the Code under Section 22(e)(3). An Eligible Trustee who becomes disabled, as
defined herein, may be eligible to receive the applicable retirement benefit
calculated as described in Section 3 using the Disability date as the date of
such trustee's termination of service.

6.    PAYMENT OF RETIREMENT BENEFITS

            6.1 Retirement or Disability Terminating Trustee's Service. Subject
to Sections 6.2 and 6.3, an Eligible Trustee shall receive the amount of the
applicable Retirement Benefit calculated pursuant to Section 3 for each of the
ten (10) years commencing in the fiscal year of such trustee's termination of
service (the "Normal Distribution"). Payment of benefits to an Eligible Trustee
shall commence, and be paid quarterly thereafter, at the end of each calendar
quarter. In the event of such Eligible Trustee's death prior to complete
distribution under the Plan, such trustee's Beneficiary shall receive the
remaining retirement benefits based upon the Normal Distribution. In the event
the Eligible Trustee survives the Beneficiary or no Beneficiary has been named,
the Fund shall pay a lump sum amount equal to the actuarial present value of the
remaining retirement benefits to the Eligible Trustee's estate.

                                       4
<PAGE>

            6.2 Death Terminating Trustee's Service. Subject to Section 6.3, in
the event an Eligible Trustee's death causes the termination of service, the
Eligible Trustee's Beneficiary shall receive the amount of the applicable Normal
Retirement Benefit or Early Retirement Benefit calculated pursuant to Section 3
for each of the ten (10) years commencing in the fiscal year of such trustee's
death. Payment of benefits to such Beneficiary shall commence, and be paid
annually thereafter, at the end of the Fund's fiscal year. In the event the
Eligible Trustee survived the Beneficiary or no Beneficiary was named, the Fund
shall pay a lump sum amount equal to the actuarial present value of the
applicable retirement benefits to the Eligible Trustee's estate.

            6.3 Liquidation, Dissolution, Winding Up or Distribution of
Substantially All of the Assets of the Fund. Notwithstanding Sections 6.1 or
6.2, in the event of a liquidation, dissolution or winding up of the Fund or
distribution of all or substantially all of the Fund's assets and property, the
Fund shall pay to each Eligible Trustee serving as a trustee of the Fund on the
effective date of such liquidation, dissolution, winding up or distribution a
lump sum amount equal to the actuarial present value of the applicable Normal
Retirement Benefit or Early Retirement Benefit calculated pursuant to Section 3
using the effective date of such liquidation, dissolution, winding up or
distribution as the date of such trustee's termination of services. In the event
an Eligible Trustee terminates services prior to such liquidation, dissolution,
winding up or distribution and such trustee (or such trustee's Beneficiary) is
then receiving payment of benefits pursuant to either Section 6.1 or 6.2 at the
time of such liquidation, dissolution, winding up or distribution, the Fund
shall pay to such trustee (or Beneficiary) on the effective date of such
liquidation, dissolution, winding up or distribution a lump sum amount equal to
the actuarial present value of the remaining retirement benefits due to such
trustee (or Beneficiary).

            6.4 Designation of Beneficiary. The Eligible Trustee's Beneficiary
shall be the person or persons so designated by such trustee in a written
instrument submitted to the President of the Fund. In the event the Eligible
Trustee fails to properly designate a Beneficiary, the Fund shall pay a lump sum
amount equal to the actuarial present value of the applicable retirement
benefits to the Eligible Trustee's estate.

                                       5
<PAGE>

            6.5 Payments Due Missing Persons. The Fund shall make a reasonable
effort to locate all persons entitled to benefits under this Plan. However,
notwithstanding any provisions of this Plan to the contrary, if, after a period
of five (5) years from the date such benefit shall be due, any such persons
entitled to benefits have not been located, their rights under this Plan shall
stand suspended. Before this provision becomes operative, the Fund shall send a
certified letter to all such persons to their last known address advising them
that their benefits under this Plan shall be suspended. Any such suspended
amounts shall be held by the Fund for a period of three (3) additional years (or
a total of eight (8) years from the time the benefits first become payable) and
thereafter, if unclaimed, such amounts shall be forfeited.

            6.6 Actuarial Present Value Calculations. For purposes of this Plan,
the "actuarial present value" of any benefits shall be computed using interest
factors and other reasonable assumptions chosen by the Plan Committee. The Plan
Committee shall have sole and uncontrolled discretion with respect to the
application of the provisions of this paragraph and such exercise of discretion
shall be conclusive and binding on the Eligible Trustee, any Beneficiary or
other person.

7.    AMENDMENTS AND TERMINATION

            7.1 Amendments. The Fund anticipates the Plan to be permanent but
the Fund reserves the right to amend any or all of the provisions of this Plan
by action of its Board of Trustees when, in the sole opinion of the Board of
Trustees, such amendment is advisable, including for the purposes of complying
with any provision of the Code or any other technical or legal requirements.

            7.2 Termination. The Fund may by action of its Board of Trustees
terminate this Plan at any time.

8.    MISCELLANEOUS.

            8.1 Forfeiture of Benefits. Notwithstanding any other provision of
the Plan, future payment of any retirement benefit hereunder to an Eligible
Trustee, Beneficiary or other person will, at the discretion of the Plan
Committee, be discontinued and forfeited, and the Fund will have no further
obligation hereunder to such Eligible Trustee, Beneficiary or other person, if
any of the following circumstances occur:

                                       6
<PAGE>

                  (a) The Eligible Trustee is discharged from the Fund's Board
of Trustee for cause;

                  (b) The Eligible Trustee engages in competition with the Fund
following such trustee's termination of service with the Fund prior to such
trustee attaining the Normal Retirement Age; or

                  (c) The Eligible Trustee performs an act or acts of willful
malfeasance or reckless disregard of duties in connection with the service as a
trustee for the Fund.

The Plan Committee shall have the sole and uncontrolled discretion with respect
to the application of the provisions of this paragraph and such exercise of
discretion shall be conclusive and binding on the Eligible Trustee, any
Beneficiary or other person.

            8.2 Administration. The Plan shall be administered by a Plan
Committee which shall be composed of three non-affiliated trustees and the
controller of the Fund.

            8.3 Agents. The Fund may employ agents and provide for such
clerical, legal, actuarial, accounting, advisory or other services as it deems
necessary to perform its duties under this Plan. The Fund shall bear the cost of
such services and all other expenses it incurs in connection with the
administration of this Plan.

            8.4 Funding and Rights of Creditors. The obligations of the Fund
under this Agreement are unfunded. Neither the Eligible Trustees, the
Beneficiaries nor any other persons shall have any interest in any specific
asset or assets of the Fund for the benefits hereunder, nor any rights to
receive distribution of the benefits except and as to the extent expressly
provided hereunder. The rights of the Eligible Trustees, the Beneficiaries or
any other person to the benefits hereunder are unsecured and shall have no
priority over the other creditors of the Fund. Any obligation of the Fund
hereunder shall be an unsecured obligation of the Fund and not of any other
person in relation to this Plan.

            8.5 Liability and Indemnification. Except for its own gross
negligence, willful misconduct or willful breach of the terms of this Plan, the
Fund shall be indemnified and held harmless by the Eligible Trustee against
liability or losses occurring by reason of any act or omission of the Fund or
any other person.

                                       7
<PAGE>

            8.6 Incapacity. If the Fund shall receive evidence satisfactory to
it that the Eligible Trustee or any Beneficiary entitled to receive any benefit
under the Plan is, at the time when such benefit becomes payable, a minor, or is
physically or mentally incompetent to receive such benefit and to give a valid
release therefor, and that another person or an institution is then maintaining
or has custody of the Eligible Trustee or Beneficiary and that no guardian,
committee or other representative of the estate of the Eligible Trustee or
Beneficiary shall have been duly appointed, the Fund may make payment of such
benefit otherwise payable to the Trustee or Beneficiary to such other person or
institution, including a custodian under the Uniform Gifts to Minors Act or
corresponding legislation (such custodian shall be an adult, a guardian of the
minor or a trust company), and the release of such other person or institution
shall be a valid and complete discharge for the payment of such benefit.

            8.7 Governing Law. This Plan is established under laws of the State
of Illinois, and all matters concerning its validity, construction and
administration shall be governed by the laws of the State of Illinois.

            8.8 Nonguarantee of Trusteeship. Nothing contained in this Plan
shall be construed as a contract or guarantee of the right of the Eligible
Trustee to be, or remain as, a trustee of the Fund or to receive any, or any
particular rate of, Compensation.

            8.9 Spendthrift Provision. The Eligible Trustee's and Beneficiaries'
interests in the benefits hereunder may not be anticipated, sold, encumbered,
pledged, mortgaged, charged, transferred, alienated, assigned nor become subject
to execution, garnishment or attachment, and any attempt to do so by any person
shall render the benefits immediately forfeitable.

            8.10 Disclosure and Notices. The rights and benefits of Eligible
Trustees under the Plan shall not be represented or evidenced by any form of
certificate or other instrument. Each Eligible Trustee shall receive a copy of
the Plan and the Plan Committee will make available for inspection by any
Eligible Trustee a copy of the rules and regulations used by the Plan Committee
in administering the Plan. For purposes of this Plan, all notices and other
communications provided for in this Plan shall be in writing and shall be deemed
to have been duly given when delivered personally or mailed by United States
registered or certified mail, return receipt requested, postage prepaid, or by
nationally recognized overnight delivery service providing for a signed return
receipt, addressed to the Eligible Trustee at the home address set forth in the
Fund's records and to the Fund at the address set forth on the first page of
this Plan, provided that all notices

                                       8
<PAGE>

to the Fund shall be directed to the attention of the President of the Fund or
to such other address as either party may have furnished to the other in writing
in accordance herewith, except that notice of change of address shall be
effective only upon receipt.

            8.11 Interpretation of Plan. Interpretations of, and determinations
related to, this Plan made by the Plan Committee in good faith, including any
determinations of the amounts of the benefits, shall be conclusive and binding
upon all parties; and the Fund shall not incur any liability to the Eligible
Trustee for any such interpretation or determination so made or for any other
action taken by it in connection with this Plan in good faith.

            8.12 Successors and Assigns. This Agreement shall be binding upon,
and shall inure to the benefit of, the Fund and its successors and assigns and
to the Eligible Trustees and such trustees' heirs, executors, administrators and
personal representatives.

                                       9
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(9)(A)
<SEQUENCE>10
<FILENAME>c93084a1exv99wx9yxay.txt
<DESCRIPTION>CUSTODIAN CONTRACT
<TEXT>
<PAGE>
                                                                    EXHIBIT 9(a)

                               CUSTODIAN CONTRACT
                                     BETWEEN
                    EACH OF THE PARTIES LISTED ON APPENDIX A
                                       AND
                       STATE STREET BANK AND TRUST COMPANY

Master.cus
GlobalSeriesCorp
21N

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                Page
                                                                                ----
<S>                                                                             <C>
1. Employment of Custodian and Property to be Held By It.....................      1
2.  Duties of the Custodian with Respect to Property of the Fund Held
    by the Custodian in the United States....................................      2
    2.1      Holding Securities..............................................      2
    2.2      Delivery of Securities..........................................      2
    2.3      Registration of Securities......................................      4
    2.4      Bank Accounts ..................................................      5
    2.5      Availability of Federal Funds...................................      5
    2.6      Collection of Income............................................      5
    2.7      Payment of Fund Moneys..........................................      5
    2.8      Liability for Payment in Advance of Receipt of Securities
             Purchased.......................................................      7
    2.9      Appointment of Agents...........................................      7
    2.10     Deposit of Fund Assets in U.S. Securities System................      7
    2.11     Fund Assets Held in the Custodian's Direct Paper System.........      8
    2.12     Segregated Account..............................................      9
    2.13     Ownership Certificates for Tax Purposes.........................     10
    2.14     Proxies.........................................................     10
    2.15     Communications Relating to Fund Securities......................     10
3. Duties of the Custodian with Respect to Property of the Fund Held
   Outside of the United States..............................................     11
    3.1      Appointment of Foreign Sub-Custodians...........................     11
    3.2      Assets to be Held...............................................     11
    3.3      Foreign Securities Systems......................................     11
</TABLE>

<PAGE>

<TABLE>
<S>                                                                               <C>
    3.4      Holding Securities .............................................     11
    3.5      Agreements with Foreign Banking Institutions ...................     12
    3.6      Access of Independent Accountants of the Fund ..................     12
    3.7      Reports by Custodian ...........................................     12
    3.8      Transactions in Foreign Custody Account ........................     12
    3.9      Liability of Foreign Sub-Custodians ............................     13
    3.10     Liability of Custodian .........................................     13
    3.11     Reimbursement for Advances .....................................     13
    3.12     Monitoring Responsibilities ....................................     14
    3.13     Branches of U.S. Banks .........................................     14
    3.14     Tax Law ........................................................     14
4.  Payments for Sales or Repurchase or Redemptions of Shares of the Fund ...     14
5.  Proper Instructions .....................................................     15
6.  Actions Permitted Without Express Authority .............................     15
7.  Evidence of Authority ...................................................     16
8.  Duties of Custodian With Respect to the Books of Account and
    Calculation of Net Asset Value and Net Income ...........................     16
9.  Records .................................................................     16
10. Opinion of Fund's Independent Accountants ...............................     17
11. Reports to Fund by Independent Public Accountants .......................     17
12. Compensation of Custodian ...............................................     17
13. Responsibility of Custodian .............................................     17
14. Effective Period, Termination and Amendment .............................     19
15. Successor Custodian .....................................................     19
16. Interpretive and Additional Provisions ..................................     20
17. Additional Funds ........................................................     20
18. Massachusetts Law to Apply ..............................................     21
19. Prior Contracts .........................................................     21
20. Reproduction of Documents ...............................................     21
21. Shareholder Communications ..............................................     21
22. Limitation of Liability .................................................
</TABLE>

                               CUSTODIAN CONTRACT

This Contract between each fund or series of a fund listed on Appendix A which
evidences its agreement to be bound hereby by executing a copy of this Contract
(each such Fund is individually hereinafter referred to as the "Fund") and State
Street Bank and Trust Company, a Massachusetts trust company, having its
principal place of business at 225 Franklin Street, Boston, Massachusetts,
02110, hereinafter called the "Custodian",


<PAGE>


                                  WITNESSETH:

WITNESSETH THAT, in consideration of the mutual covenants and agreements
hereinafter contained, the parties hereto agree as follows:

1. Employment of Custodian and Property to be Held by It

The Fund hereby employs the Custodian as the custodian of the assets of the
Fund, including securities which the Fund desires to be held in places within
the United States ("domestic securities") and securities it desires to be held
outside the United States ("foreign securities") pursuant to the provisions of
the Fund's governing documents. The Fund agrees to deliver to the Custodian all
securities and cash of the Fund, and all payments of income, payments of
principal or capital distributions received by it with respect to all securities
owned by the Fund from time to time, and the cash consideration received by it
for such new or treasury shares of capital stock, beneficial interest or
partnership interest, as applicable, of the Fund ("Shares") as may be issued or
sold from time to time. The Custodian shall not be responsible for any property
of a Fund held or received by the Fund and not delivered to the Custodian.

Upon receipt of "Proper Instructions" (within the meaning of Article 5), the
Custodian shall on behalf of the applicable Fund(s) from time to time employ one
or more sub-custodians, located in the United States but only in accordance with
an applicable vote by the Board of Trustees of the Fund, and provided that the
Custodian shall have no more or less responsibility or liability to the Fund on
account of any actions or omissions of any sub-custodian so employed than any
such sub-custodian has to the Custodian. The Custodian may employ as
sub-custodian for the Fund's foreign securities the foreign banking institutions
and foreign securities depositories designated in Schedule A hereto but only in
accordance with the provisions of Article 3.

2. Duties of the Custodian with Respect to Property of the Fund Held By the
Custodian in the United States

2.1 Holding Securities. The Custodian shall hold and physically segregate for
the account of each Fund all non-cash property to be held by it in the United
States including all domestic securities owned by such Fund other than (a)
securities which are maintained pursuant to Section 2.10 in a clearing agency
which acts as a securities depository or in a book-entry system authorized by
the U.S. Department of the Treasury and certain federal agencies (collectively
referred to herein as a "U.S. Securities System") and (b) commercial paper of an
issuer for which State Street Bank and Trust Company acts as issuing and paying
agent

("Direct Paper") which is deposited and/or maintained in the Direct Paper System
of the Custodian (the "Direct Paper System") pursuant to Section


<PAGE>

2.11.

2.2 Delivery of Securities. The Custodian shall release and deliver domestic
securities owned by a Fund held by the Custodian or in a U.S. Securities System
account of the Custodian or in the Custodian's Direct Paper book entry system
account ("Direct Paper System Account") only upon receipt of Proper Instructions
from the Fund, which may be continuing instructions when deemed appropriate by
the parties, and only in the following cases:

1) Upon sale of such securities for the account of the Fund and receipt of
payment therefor;

2) Upon the receipt of payment in connection with any repurchase agreement
related to such securities entered into by the Fund;

3) In the case of a sale effected through a U.S. Securities System. in
accordance with the provisions of Section 2.10 hereof;

4) To the depository agent in connection with tender or other similar offers for
securities of the Fund;

5) To the issuer thereof or its agent when such securities are called, redeemed,
retired or otherwise become payable; provided that, in any such case, the cash
or other consideration is to be delivered to the Custodian;

6) To the issuer thereof, or its agent, for transfer into the name of the Fund
or into the name of any nominee or nominees of the Custodian or into the name or
nominee name of any agent appointed pursuant to Section 2.9 or into the name or
nominee name of any sub-custodian appointed pursuant to Article 1; or for
exchange for a different number of bonds, certificates or other evidence
representing the same aggregate face amount or number of units; provided that,
in any such case, the new securities are to be delivered to the Custodian;

7) Upon the sale of such securities for the account of the Fund, to the broker
or its clearing agent, against a receipt, for examination in accordance with
"street delivery" custom; provided that in any such case, the Custodian shall
have no responsibility or liability for any loss arising from the delivery of
such securities prior to receiving payment for such securities except as may
arise from the Custodian's own negligence or willful misconduct;

8) For exchange or conversion pursuant to any plan of merger, consolidation,
recapitalization, reorganization or readjustment of the securities of the issuer
of such

                                        2
<PAGE>

securities, or pursuant to provisions for conversion contained in such
securities, or pursuant to any deposit agreement; provided that, in any such
case, the new securities and cash, if any, are to be delivered to the Custodian;

9) In the case of warrants, rights or similar securities, the surrender thereof
in the exercise of such warrants, rights or similar securities or the surrender
of interim receipts or temporary securities for definitive securities; provided
that, in any such case, the new securities and cash, if any, are to be delivered
to the Custodian;

10) For delivery in connection with any loans of securities made by the Fund,
but only against receipt of adequate collateral as agreed upon from time to time
by the Custodian and the Fund, which may be in the form of cash or obligations
issued by the United States government, its agencies or instrumentalities,
except that in connection with any loans for which collateral is to be credited
to the Custodian's account in the book-entry system authorized by the U.S.
Department of the Treasury, the Custodian will not be held liable or responsible
for the delivery of securities owned by the Fund prior to the receipt of such
collateral;

11) For delivery as security in connection with any borrowings by the Fund
requiring a pledge of assets by the Fund, but only against receipt of amounts
borrowed;

12) For delivery in accordance with the provisions of any agreement among the
Fund, the Custodian and a broker-dealer registered under the Securities Exchange
Act of 1934 (the "Exchange Act") and a member of The National Association of
Securities Dealers, Inc. ("NASD"), relating to compliance with the rules of The
Options Clearing Corporation and of any registered national securities exchange,
or of any similar organization or organizations, regarding escrow or other
arrangements in connection with transactions by the Fund;

13) For delivery in accordance with the provisions of any agreement among the
Fund, the Custodian, and a Futures Commission Merchant registered under the
Commodity Exchange Act, relating to compliance with the rules of the Commodity
Futures Trading Commission and/or any Contract Market, or any similar
organization or organizations, regarding account deposits in connection with
transactions by the Fund;

14) Upon receipt of instructions from the transfer agent ("Transfer Agent") for
the Fund, for delivery to such Transfer Agent or to the holders of shares in
connection with distributions in kind, as may be described from time to time in
the currently effective prospectus and statement of additional information of
the Fund ("Prospectus"), in satisfaction of requests by holders of Shares for
repurchase or redemption;


                                        3
<PAGE>
15) For any other proper corporate purpose, but only upon receipt of, in
addition to Proper Instructions from the Fund, a certified copy of a resolution
of the Board of Trustees, specifying the securities of the Fund to be delivered,
setting forth the purpose for which such delivery is to be made, declaring such
purpose to be a proper corporate purpose, and naming the person or persons to
whom delivery of such securities shall be made; and

16) Upon termination of the Contract.

2.3 Registration of Securities. Domestic securities held by the Custodian (other
than bearer securities) shall be registered in the name of the Fund or in the
name of any nominee of the Fund or of any nominee of the Custodian which nominee
shall be assigned exclusively to the Fund, unless the Fund has authorized in
writing the appointment of a nominee to be used in common with other registered
investment companies having the same investment adviser as the Fund, or in the
name or nominee name of any agent appointed pursuant to Section 2.9 or in the
name or nominee name of any sub-custodian appointed pursuant to Article 1. All
securities accepted by the Custodian on behalf of the Fund under the terms of
this Contract shall be in "street name" or other good delivery form. If,
however, the Fund directs the Custodian to maintain securities in "street name",
the Custodian shall utilize its best efforts only to timely collect income due
the Fund on such securities and to notify the Fund on a best efforts basis only
of relevant corporate actions including, without limitation, pendency of calls,
maturities, tender or exchange offers.

2.4 Bank Accounts. The Custodian shall open and maintain a separate bank account
or accounts in the United States in the name of each Fund, subject only to draft
or order by the Custodian acting pursuant to the terms of this Contract, and
shall hold in such account or accounts, subject to the provisions hereof, all
cash received by it from or for the account of the Fund, other than cash
maintained by the Fund in a bank account established and used in accordance with
Rule 17f-3 under the Investment Company Act of 1940. Funds held by the Custodian
for a Fund may be deposited by it to its credit as Custodian in the Banking
Department of the Custodian or in such other banks or trust companies as it may
in its discretion deem necessary or desirable; provided, however, that every
such bank or trust company shall be qualified to act as a custodian under the
Investment Company Act of 1940 and that each such bank or trust company and the
funds to be deposited with each such bank or trust company shall on behalf of
each applicable Fund be approved by vote of a majority of the Board of Trustees
of the Fund. Such funds shall be deposited by the Custodian in its capacity as
Custodian and shall be withdrawable by the Custodian only in that capacity.

2.5 Availability of Federal Funds. Upon mutual agreement between the Fund and
the Custodian, the Custodian shall, upon the receipt of Proper Instructions from
the Fund, make

                                        4
<PAGE>

federal funds available to such Fund as of specified times agreed upon from time
to time by the Fund and the Custodian in the amount of checks received in
payment for Shares of such Fund which are deposited into the Fund's account.

2.6 Collection of Income. Subject to the provisions of Section 2.3, the
Custodian shall collect on a timely basis all income and other payments with
respect to registered domestic securities held hereunder to which the Fund shall
be entitled either by law or pursuant to custom in the securities business, and
shall collect on a timely basis all income and other payments with respect to
bearer domestic securities if, on the date of payment by the issuer, such
securities are held by the Custodian or its agent thereof and shall credit such
income, as collected, to such Fund's custodian account. Without limiting the
generality of the foregoing, the Custodian shall detach and present for payment
all coupons and other income items requiring presentation as and when they
become due and shall collect interest when due on securities held hereunder.
Income due each Fund on securities loaned pursuant to the provisions of Section
2.2 (10) shall be the responsibility of the Fund. The Custodian will have no
duty or responsibility in connection therewith, other than to provide the Fund
with such information or data as may be necessary to assist the Fund in
arranging for the timely delivery to the Custodian of the income to which the
Fund is properly entitled.

2.7 Payment of Fund Moneys. Upon receipt of Proper Instructions from the Fund,
which may be continuing instructions when deemed appropriate by the parties, the
Custodian shall pay out moneys of a Fund in the following cases only:

1) Upon the purchase of domestic securities, options, futures contracts or
options on futures contracts for the account of the Fund but only (a) against
the delivery of such securities or evidence of title to such options, futures
contracts or options on futures contracts to the Custodian (or any bank, banking
firm or trust company doing business in the United States or abroad which is
qualified under the Investment Company Act of 1940, as amended, to act as a
custodian and has been designated by the Custodian as its agent for this
purpose) registered in the name of the Fund or in the name of a nominee of the
Custodian referred to in Section 2.3 hereof or in proper form for transfer; (b)
in the case of a purchase effected through a U.S. Securities System, in
accordance with the conditions set forth in Section 2.10 hereof; (c) in the case
of a purchase involving the Direct Paper System, in accordance with the
conditions set forth in Section 2.11; (d) in the case of repurchase agreements
entered into between the Fund and the Custodian, or another bank, or a
broker-dealer which is a member of NASD, (i) against delivery of the securities
either in certificate form or through an entry crediting the Custodian's account
at the Federal Reserve Bank with such securities or (ii) against delivery of the
receipt evidencing purchase by the Fund of securities owned by the Custodian
along with written evidence of the agreement by the Custodian to repurchase such
securities from the Fund or (e) for transfer to a time deposit account of the
Fund in

                                        5
<PAGE>

any bank, whether domestic or foreign; such transfer may be effected prior to
receipt of a confirmation from a broker and/or the applicable bank pursuant to
Proper Instructions from the Fund as defined in Article 5;

2) In connection with conversion, exchange or surrender of securities owned by
the Fund as set forth in Section 2.2 hereof;

3) For the redemption or repurchase of Shares issued by the Fund as set forth in
Article 4 hereof;

4) For the payment of any expense or liability incurred by the Fund, including
but not limited to the following payments for the account of the Fund: interest,
taxes, management, accounting, transfer agent and legal fees, and operating
expenses of the Fund whether or not such expenses are to be in whole or part
capitalized or treated as deferred expenses;

5) For the payment of any dividends on Shares of the Fund declared pursuant to
the governing documents of the Fund;

6) For payment of the amount of dividends received in respect of securities sold
short;

7) For any other proper purpose, but only upon receipt of, in addition to Proper
Instructions from the Fund, a certified copy of a resolution of the Board of
Trustees, specifying the amount of such payment, setting forth the purpose for
which such payment is to be made, declaring such purpose to be a proper purpose,
and naming the person or persons to whom such payment is to be made; and

8) Upon termination of this Contract.

2.8 Liability for Payment in Advance of Receipt of Securities Purchased. Except
as specifically stated otherwise in this Contract, in any and every case where
payment for purchase of domestic securities for the account of a Fund is made by
the Custodian in advance of receipt of the securities purchased in the absence
of specific written instructions from the Fund to so pay in advance, the
Custodian shall be absolutely liable to the Fund for such securities to the same
extent as if the securities had been received by the Custodian.

2.9 Appointment of Agents. The Custodian may at any time or times in its
discretion appoint (and may at any time remove) any other bank or trust company
which is itself qualified under the Investment Company Act of 1940, as amended,
to act as a custodian, as its agent to carry out such of the provisions of this
Article 2 as the Custodian may from time to time direct; provided, however, that
the appointment of any agent shall not relieve the Custodian of its
responsibilities or liabilities hereunder.

                                        6
<PAGE>

2.10 Deposit of Fund Assets in U.S. Securities Systems. The Custodian may
deposit and/or maintain securities owned by a Fund in a clearing agency
registered with the Securities and Exchange Commission under Section 17A of the
Securities Exchange Act of 1934, which acts as a securities depository, or in
the book-entry system authorized by the U.S. Department of the Treasury and
certain federal agencies, collectively referred to herein as "U.S. Securities
System" in accordance with applicable Federal Reserve Board and Securities and
Exchange Commission rules and regulations, if any, and subject to the following
provisions:

1) The Custodian may keep securities of the Fund in a U.S. Securities System
provided that such securities are represented in an account ("Account") of the
Custodian in the U.S. Securities System which shall not include any assets of
the Custodian other than assets held as a fiduciary, custodian or otherwise for
customers;

2) The records of the Custodian with respect to securities of the Fund which are
maintained in a U.S. Securities System shall identify by book-entry those
securities belonging to the Fund;

3) The Custodian shall pay for securities purchased for the account of the Fund
upon (i) receipt of advice from the U.S. Securities System that such securities
have been transferred to the Account, and (ii) the making of an entry on the
records of the Custodian to reflect such payment and transfer for the account of
the Fund. The Custodian shall transfer securities sold for the account of the
Fund upon (i) receipt of advice from the U.S. Securities System that payment for
such securities has been transferred to the Account, and (ii) the making of an
entry on the records of the Custodian to reflect such transfer and payment for
the account of the Fund. Copies of all advices from the U.S. Securities System
of transfers of securities for the account of the Fund shall identify the Fund,
be maintained for the Fund by the Custodian and be provided to the Fund at its
request. Upon request, the Custodian shall furnish the Fund confirmation of each
transfer to or from the account of the Fund in the form of a written advice or
notice and shall furnish to the Fund copies of daily transaction sheets
reflecting each day's transactions in the U.S. Securities System for the account
of the Fund.

4) The Custodian shall provide the Fund with any report obtained by the
Custodian on the U.S. Securities System's accounting system, internal accounting
control and procedures for safeguarding securities deposited in the U.S.
Securities System;

5) The Custodian shall have received from the Fund the initial or annual
certificate, as the case may be, required by Article 14 hereof;


                                        7
<PAGE>
6) Anything to the contrary in this Contract notwithstanding, the Custodian
shall be liable to the Fund for any loss or damage to the Fund resulting from
use of the U.S. Securities System by reason of any negligence, misfeasance or
misconduct of the Custodian or any of its agents or of any of its or their
employees or from failure of the Custodian or any such agent to enforce
effectively such rights as it may have against the U.S. Securities System; at
the election of the Fund, it shall be entitled to be subrogated to the rights of
the Custodian with respect to any claim against the U.S. Securities System or
any other person which the Custodian may have as a consequence of any such loss
or damage if and to the extent that the Fund has not been made whole for any
such loss or damage.

2.11 Fund Assets Held in the Custodian's Direct Paper System. The Custodian may
deposit and/or maintain securities owned by a Fund in the Direct Paper System of
the Custodian subject to the following provisions:

1) No transaction relating to securities in the Direct Paper System will be
effected in the absence of Proper Instructions from the Fund;

2) The Custodian may keep securities of the Fund in the Direct Paper System only
if such securities are represented in an account of the Custodian in the Direct
Paper System which shall not include any assets of the Custodian other than
assets held as a fiduciary, custodian or otherwise for customers;

3) The records of the Custodian with respect to securities of the Fund which are
maintained in the Direct Paper System shall identify by book-entry those
securities belonging to the Fund;

4) The Custodian shall pay for securities purchased for the account of the Fund
upon the making of an entry on the records of the Custodian to reflect such
payment and transfer of securities to the account of the Fund. The Custodian
shall transfer securities sold for the account of the Fund upon the making of an
entry on the records of the Custodian to reflect such transfer and receipt of
payment for the account of the Fund;

5) The Custodian shall furnish the Fund confirmation of each transfer to or from
the account of the Fund, in the form of a written advice or notice, of Direct
Paper on the next business day following such transfer and shall furnish to the
Fund copies of daily transaction sheets reflecting each day's transaction in the
U.S. Securities System for the account of the Fund;

6) The Custodian shall provide the Fund with any report on its system of
internal accounting control as the Fund may reasonably request from time to
time.


                                       8
<PAGE>
2.12 Segregated Account. The Custodian shall upon receipt of Proper Instructions
from the Fund establish and maintain a segregated account or accounts for and on
behalf of each such Fund, into which account or accounts may be transferred cash
and/or securities, including securities maintained in an account by the
Custodian pursuant to Section 2.10 hereof, (i) in accordance with the provisions
of any agreement among the Fund, the Custodian and a broker-dealer registered
under the Exchange Act and a member of the NASD (or any futures commission
merchant registered under the Commodity Exchange Act), relating to compliance
with the rules of The Options Clearing Corporation and of any registered
national securities exchange (or the Commodity Futures Trading Commission or any
registered contract market), or of any similar organization or organizations,
regarding escrow or other arrangements in connection with transactions by the
Fund, (ii) for purposes of segregating cash or government securities in
connection with options purchased, sold or written by the Fund or commodity
futures contracts or options thereon purchased or sold by the Fund, (iii) for
the purposes of compliance by the Fund with the procedures required by
Investment Company Act Release No. 10666, or any subsequent release or releases
of the Securities and Exchange Commission relating to the maintenance of
segregated accounts by registered investment companies and (iv) for other proper
corporate purposes, but only, in the case of clause (iv), upon receipt of, in
addition to Proper Instructions from the Fund, a certified copy of a resolution
of the Board of Trustees setting forth the purpose or purposes of such
segregated account and declaring such purposes to be proper corporate purposes.

2.13 Ownership Certificates for Tax Purposes. The Custodian shall execute
ownership and other certificates and affidavits for all federal and state tax
purposes in connection with receipt of income or other payments with respect to
domestic securities of each Fund held by it and in connection with transfers of
securities.

2.14 Proxies. The Custodian shall, with respect to the domestic securities held
hereunder, cause to be promptly executed by the registered holder of such
securities, if the securities are registered otherwise than in the name of the
Fund or a nominee of the Fund, all proxies, without indication of the manner in
which such proxies are to be voted, and shall promptly deliver to the Fund such
proxies, all proxy soliciting materials and all notices relating to such
securities.

2.15 Communications Relating to Fund Securities. Subject to the provisions of
Section 2.3, the Custodian shall transmit promptly to the Fund all written
information (including, without limitation, pendency of calls and maturities of
domestic securities and expirations of rights in connection therewith and
notices of exercise of call and put options written by the Fund and the maturity
of futures contracts purchased or sold by the Fund) received by the Custodian
from issuers of the securities being held for the Fund. With respect to tender
or exchange offers, the Custodian shall transmit promptly to the Fund all
written information received by the Custodian from issuers of the securities
whose tender or exchange is sought

                                       9
<PAGE>
and from the party (or his agents) making the tender or exchange offer. If the
Fund desires to take action with respect to any tender offer, exchange offer or
any other similar transaction, the Fund shall notify the Custodian at least
three business days prior to the date on which the Custodian is to take such
action.

3. Duties of the Custodian with Respect to Property of the Fund Held Outside of
the United States

3.1 Appointment of Foreign Sub-Custodians. The Fund hereby authorizes and
instructs the Custodian to employ as sub-custodians for the Fund's securities
and other assets maintained outside the United States the foreign banking
institutions and foreign securities depositories designated on Schedule A hereto
("foreign sub-custodians"). Upon receipt of "Proper Instructions", as defined in
Section 5 of this Contract, together with a certified resolution of the Fund's
Board of Trustees, the Custodian and the Fund may agree to amend Schedule A
hereto from time to time to designate additional foreign banking institutions
and foreign securities depositories to act as sub-custodian. Upon receipt of
Proper Instructions, the Fund may instruct the Custodian to cease the employment
of any one or more such sub-custodians for maintaining custody of the Fund's
assets.

3.2 Assets to be Held. The Custodian shall limit the securities and other assets
maintained in the custody of the foreign sub-custodians to: (a) "foreign
securities", as defined in paragraph (c)(l) of Rule 17f-5 under the Investment
Company Act of 1940, and (b) cash and cash equivalents in such amounts as the
Custodian or the Fund may determine to be reasonably necessary to effect the
Fund's foreign securities transactions. The Custodian shall identify on its
books as belonging to the Fund, the foreign securities of the Fund held by each
foreign sub-custodian.

3.3 Foreign Securities Systems. Except as may otherwise be agreed upon in
writing by the Custodian and the Fund, assets of the Funds shall be maintained
in a clearing agency which acts as a securities depository or in a book-entry
system for the central handling of securities located outside of the United
States (each a "Foreign Securities System") only through arrangements
implemented by the foreign banking institutions serving as sub-custodians
pursuant to the terms hereof (Foreign Securities Systems and U.S. Securities
Systems are collectively referred to herein as the "Securities Systems"). Where
possible, such arrangements shall include entry into agreements containing the
provisions set forth in Section 3.5 hereof.

3.4 Holding Securities. The Custodian may hold cash, securities and other
non-cash property for all of its customers, including the Fund, with a foreign
sub-custodian in a single account that is identified as belonging to the
Custodian for the benefit of its customers, provided however, that (i) the
records of the Custodian with respect to cash, securities and other non-cash
property of the Fund which are maintained in such account shall identify by
book-
                                       10
<PAGE>
entry the cash, securities and other non-cash property belonging to the Fund
and (ii) the Custodian shall require that cash, securities and other non-cash
property so held by the foreign sub-custodian be held separately from any assets
of the Custodian, the foreign sub-custodian or of others.

3.5 Agreements with Foreign Banking Institutions. Each agreement with a foreign
banking institution shall provide that: (a) the assets of each Fund will not be
subject to any right, charge, security interest, lien or claim of any kind in
favor of the foreign banking institution or its creditors or agent, except a
claim of payment for their safe custody or administration; (b) beneficial
ownership for the assets of each Fund will be freely transferable without the
payment of money or value other than for custody or administration; (c) adequate
records will be maintained identifying the assets as belonging to each
applicable Fund; (d) officers of or auditors employed by, or other
representatives of the Custodian, including to the extent permitted under
applicable law the independent public accountants for the Fund, will be given
access to the books and records of the foreign banking institution relating to
its actions under its agreement with the Custodian; and (e) assets of the Funds
held by the foreign sub-custodian will be subject only to the instructions of
the Custodian or its agents.

3.6 Access of Independent Accountants of the Fund. Upon request of the Fund, the
Custodian will use its best efforts to arrange for the independent accountants
of the Fund to be afforded access to the books and records of any foreign
banking institution employed as a foreign sub-custodian insofar as such books
and records relate to the performance of such foreign banking institution under
its agreement with the Custodian.

3.7 Reports by Custodian. The Custodian will supply to the Fund from time to
time, as mutually agreed upon, statements in respect of the securities and other
assets of the Fund(s) held by foreign sub-custodians, including but not limited
to an identification of entities having possession of the Fund(s) securities and
other assets and advices or notifications of any transfers of securities to or
from each custodial account maintained by a foreign banking institution for the
Custodian on behalf of each applicable Fund indicating, as to securities
acquired for a Fund, the identity of the entity having physical possession of
such securities.

3.8 Transactions in Foreign Custody Account. (a) Except as otherwise provided in
paragraph (b) of this Section 3.8, the provision of Sections 2.2 and 2.7 of this
Contract shall apply, mutatis mutandis to the foreign securities of the Fund
held outside the United States by foreign sub-custodians.

(b) Notwithstanding any provision of this Contract to the contrary, settlement
and payment for securities received for the account of each applicable Fund and
delivery of securities maintained for the account of each applicable Fund may be
effected in accordance with the customary established securities trading or
securities processing practices and

                                       11
<PAGE>

procedures in the jurisdiction or market in which the transaction occurs,
including, without limitation, delivering securities to the purchaser thereof or
to a dealer therefor (or an agent for such purchaser or dealer) against a
receipt with the expectation of receiving later payment for such securities from
such purchaser or dealer. In addition, and whether or not such practice is a
customary established trading practice in the relevant jurisdictions, the
Custodian will, upon Proper Instructions from the Fund, deliver cash to
securities brokers in foreign jurisdictions who will effect securities trades
for the Fund and cause the securities purchased to be delivered to the
applicable foreign sub-custodian at some later date.

(c) Securities maintained in the custody of a foreign sub-custodian may be
maintained in the name of such entity's nominee to the same extent as set forth
in Section 2.3 of this Contract, and the Fund agrees to hold any such nominee
harmless from any liability as a holder of record of such securities.

3.9 Liability of Foreign Sub-Custodians. Each agreement pursuant to which the
Custodian employs a foreign banking institution as a foreign sub-custodian shall
require the institution to exercise reasonable care in the performance of its
duties and to indemnify, and hold harmless, the Custodian and each Fund from and
against any loss, damage, cost, expense, liability or claim arising out of or in
connection with the institution's performance of such obligations. At the
election of the Fund, it shall be entitled to be subrogated to the rights of the
Custodian with respect to any claims against a foreign banking institution as a
consequence of any such loss, damage, cost, expense, liability or claim if and
to the extent that the Fund has not been made whole for any such loss, damage,
cost, expense, liability or claim.

3.10 Liability of Custodian. The Custodian shall be liable for the acts or
omissions of a foreign banking institution to the same extent as set forth with
respect to sub-custodians generally in this Contract and, regardless of whether
assets are maintained in the custody of a foreign banking institution, a foreign
securities depository or a branch of a U.S. bank as contemplated by paragraph
3.13 hereof, the Custodian shall not be liable for any loss, damage, cost,
expense, liability or claim resulting from nationalization, expropriation.
currency restrictions, or acts of war or terrorism or any loss where the
sub-custodian has otherwise exercised reasonable care. Notwithstanding the
foregoing provisions of this paragraph 3.10, in delegating custody duties to
State Street London Ltd., the Custodian shall not be relieved of any
responsibility to the Fund for any loss due to such delegation. except such loss
as may result from (a) political risk (including, but not limited to, exchange
control restrictions, confiscation, expropriation, nationalization,
insurrection, civil strife or armed hostilities) or (b) other losses (excluding
a bankruptcy or insolvency of State Street London Ltd. not caused by political
risk) due to Acts of God, nuclear incident or other losses under circumstances
where the Custodian and State Street London Ltd. have exercised reasonable care.

                                       12
<PAGE>

3.11 Reimbursement for Advances. If the Fund requires the Custodian to advance
cash or securities for any purpose for the benefit of a Fund including the
purchase or sale of foreign exchange or of contracts for foreign exchange, or in
the event that the Custodian or its nominee shall incur or be assessed any
taxes, charges, expenses, assessments, claims or liabilities in connection with
the performance of this Contract, except such as may arise from its or its
nominee's own negligent action, negligent failure to act or willful misconduct,
any property at any time held for the account of the applicable Fund shall be
security therefor and should the Fund fail to repay the Custodian promptly, the
Custodian shall be entitled to utilize available cash and to dispose of such
Fund's assets to the extent necessary to obtain reimbursement.

3.12 Monitoring Responsibilities. The Custodian shall furnish annually to the
Fund, during the month of June, information concerning the foreign
sub-custodians employed by the Custodian. Such information shall be similar in
kind and scope to that furnished to the Fund in connection with the initial
approval of this Contract. In addition, the Custodian will promptly inform the
Fund in the event that the Custodian learns of a material adverse change in the
financial condition of a foreign sub-custodian or any material loss of the
assets of the Fund or in the case of any foreign sub-custodian not the subject
of an exemptive order from the Securities and Exchange Commission is notified by
such foreign sub-custodian that there appears to be a substantial likelihood
that its shareholders' equity will decline below $200 million (U.S. dollars or
the equivalent thereof) or that its shareholders' equity has declined below $200
million (in each case computed in accordance with generally accepted U.S.
accounting principles).

3.13 Branches of U.S. Banks. (a) Except as otherwise set forth in this Contract,
the provisions hereof shall not apply where the custody of the Funds' assets are
maintained in a foreign branch of a banking institution which is a "bank" as
defined by Section 2(a)(5) of the Investment Company Act of 1940 meeting the
qualification set forth in Section 26(a) of said Act. The appointment of any
such branch as a sub-custodian shall be governed by paragraph 1 of this
Contract. (b) Cash held for each Fund in the United Kingdom shall be maintained
in an interest bearing account established for the Fund with the Custodian's
London branch, which account shall be subject to the direction of the Custodian,
State Street London Ltd. or both.

3.14 The Custodian shall have no responsibility or liability for any obligations
now or hereafter imposed on the Fund or the Custodian as custodian of the Fund
by the tax law of the United States of America or any state or political
subdivision thereof. It shall be the responsibility of the Fund to notify the
Custodian of the obligations imposed on the Fund or the Custodian as custodian
of the Fund by the tax law of jurisdictions other than those mentioned in the
above sentence, including responsibility for withholding and other taxes,
assessments or other governmental charges, certifications and governmental
reporting. The sole responsibility of the Custodian with regard to such tax law
shall be to use reasonable

                                       13
<PAGE>

efforts to assist the Fund with respect to any claim for exemption or refund
under the tax law of jurisdictions for which the Fund has provided such
information.

4. Payments for Sales or Repurchases or Redemptions of Shares of the Fund

The Custodian shall receive from the distributor for the Shares or from the
Transfer Agent of the Fund and deposit into the account of the appropriate Fund
such payments as are received for Shares of that Fund issued or sold from time
to time by the Fund. The Custodian will provide timely notification to the Fund
on behalf of each such Fund and the Transfer Agent of any receipt by it of
payments for Shares of such Fund.

From such funds as may be available for the purpose but subject to the
limitations of the applicable Fund's governing documents and any applicable
votes of the Board of Trustees of the Fund pursuant thereto, the Custodian
shall, upon receipt of instructions from the Transfer Agent, make funds
available for payment to holders of Shares who have delivered to the Transfer
Agent a request for redemption or repurchase of their Shares. In connection with
the redemption or repurchase of Shares of a Fund, the Custodian is authorized
upon receipt of instructions from the Transfer Agent to wire funds to or through
a commercial bank designated by the redeeming shareholders. In connection with
the redemption or repurchase of Shares of the Fund, the Custodian shall honor
checks drawn on the Custodian by a holder of Shares, which checks have been
furnished by the Fund to the holder of Shares, when presented to the Custodian
in accordance with such procedures and controls as are mutually agreed upon from
time to time between the Fund and the Custodian.

5. Proper Instructions

Proper Instructions as used throughout this Contract means a writing signed or
initialed by one or more person or persons as the Board of Trustees shall have
from time to time authorized. Each such writing shall set forth the specific
transaction or type of transaction involved, including a specific statement of
the purpose for which such action is requested. Oral instructions will be
considered Proper Instructions if the Custodian reasonably believes them to have
been given by a person authorized to give such instructions with respect to the
transaction involved. The Fund shall cause all oral instructions to be confirmed
in writing. Upon receipt of a certificate of the Secretary or an Assistant
Secretary as to the authorization by the Board of Trustees of the Fund
accompanied by a detailed description of procedures approved by the Board of
Trustees, Proper Instructions may include communications effected directly
between electro-mechanical or electronic devices provided that the Board of
Trustees and the Custodian are satisfied that such procedures afford adequate
safeguards for the Funds' assets. For purposes of this Section, Proper
Instructions shall include instructions received by the Custodian pursuant to
any three-party agreement which requires a segregated asset account in
accordance with Section 2.12.

                                       14
<PAGE>

6. Actions Permitted without Express Authority

The Custodian may in its discretion, without express authority from the Fund:

1) make payments to itself or others for minor expenses of handling securities
or other similar items relating to its duties under this Contract, provided that
all such payments shall be accounted for to the Fund;

2) surrender securities in temporary form for securities in definitive form;

3) endorse for collection, in the name of the Fund, checks, drafts and other
negotiable instruments; and

4) in general, attend to all non-discretionary details in connection with the
sale, exchange, substitution, purchase, transfer and other dealings with the
securities and property of the Fund except as otherwise directed by the Board of
Trustees of the Fund.

7. Evidence of Authority

The Custodian shall be protected in acting upon any instructions, notice,
request, consent, certificate or other instrument or paper believed by it to be
genuine and to have been properly executed by or on behalf of the Fund. The
Custodian may receive and accept a certified copy of a vote of the Board of
Trustees of the Fund as conclusive evidence (a) of the authority of any person
to act in accordance with such vote or (b) of any determination or of any action
by the Board of Trustees pursuant to the governing documents of the Fund as
described in such vote, and such vote may be considered as in full force and
effect until receipt by the Custodian of written notice to the contrary.

8. Duties of Custodian with Respect to the Books of Account and Calculation of
Net Asset Value and Net Income

The Custodian shall cooperate with and supply necessary information to the
entity or entities appointed by the Board of Trustees of the Fund to keep the
books of account of each Fund and/or compute the net asset value per share of
the outstanding shares of the Fund or, if the Custodian and the Fund execute the
applicable Price Source Authorization (the "Authorization"), the Custodian shall
keep such books of account and/or compute the net asset value per share pursuant
to the terms of the Authorization and the attachments thereto. If so directed,
the Custodian shall also calculate daily the net income of the Fund as described
in the Fund's currently effective Prospectus related to such Fund and shall
advise the Fund and the Transfer Agent daily of the total amounts of such net
income and, if instructed in writing by an officer of the Fund to do so, shall
advise the Transfer Agent periodically of the division of such net income among
its various

                                       15
<PAGE>

components. The calculations of the net asset value per share and the daily
income of each Fund shall be made at the time or times described from time to
time in the Fund's currently effective Prospectus related to such Fund.

9. RECORDS

The Custodian shall with respect to each Fund create and maintain all records
relating to its activities and obligations under this Contract in such manner as
will meet the obligations of the Fund under the Investment Company Act of 1940,
with particular attention to Section 31 thereof and Rules 31 a-1 and 31 a-2
thereunder. All such records shall be the property of the Fund and shall at all
times during the regular business hours of the Custodian be open for inspection
by duly authorized officers, employees or agents of the Fund and employees and
agents of the Securities and Exchange Commission. The Custodian shall, at the
Fund's request, supply the Fund with a tabulation of securities owned by each
Fund and held by the Custodian and shall, when requested to do so by the Fund
and for such compensation as shall be agreed upon between the Fund and the
Custodian, include certificate numbers in such tabulations.

10. Opinion of Fund's Independent Accountant

The Custodian shall take all reasonable action, as the Fund may from time to
time request, to obtain from year to year favorable opinions from the Fund's
independent accountants with respect to its activities hereunder in connection
with the preparation of the Fund's Form N-1A, and Form N-SAR or other annual
reports to the Securities and Exchange Commission and with respect to any other
requirements of such Commission.

11. Reports to Fund by Independent Public Accountants

The Custodian shall provide the Fund, at such times as the Fund may reasonably
require, with reports by independent public accountants on the accounting
system, internal accounting control and procedures for safeguarding securities,
futures contracts and options on futures contracts, including securities
deposited and/or maintained in a Securities System, relating to the services
provided by the Custodian under this Contract; such reports, shall be of
sufficient scope and in sufficient detail, as may reasonably be required by the
Fund to provide reasonable assurance that any material inadequacies would be
disclosed by such examination, and, if there are no such inadequacies, the
reports shall so state.

12. Compensation of Custodian

The Custodian shall be entitled to reasonable compensation for its services and
expenses as Custodian, as agreed upon from time to time between the Fund and the
Custodian.

                                       16
<PAGE>

13. Responsibility of Custodian

So long as and to the extent that it is in the exercise of reasonable care, the
Custodian shall not be responsible for the title, validity or genuineness of any
property or evidence of title thereto received by it or delivered by it pursuant
to this Contract and shall be held harmless in acting upon any notice, request,
consent, certificate or other instrument reasonably believed by it to be genuine
and to be signed by the proper party or parties, including any futures
commission merchant acting pursuant to the terms of a three-party futures or
options agreement. The Custodian shall be held to the exercise of reasonable
care in carrying out the provisions of this Contract, but shall be kept
indemnified by and shall be without liability to the Fund for any action taken
or omitted by it in good faith without negligence. It shall be entitled to rely
on and may act upon advice of counsel (who may be counsel for the Fund) on all
matters, and shall be without liability for any action reasonably taken or
omitted pursuant to such advice.

Except as may arise from the Custodian's own negligence or willful misconduct or
the negligence or willful misconduct of a sub-custodian or agent, the Custodian
shall be without liability to the Fund for any loss, liability, claim or expense
resulting from or caused by: (i) events or circumstances beyond the reasonable
control of the Custodian or any sub-custodian or Securities System or any agent
or nominee of any of the foregoing, including, without limitation,
nationalization or expropriation, imposition of currency controls or
restrictions, the interruption, suspension or restriction of trading on or the
closure of any securities market, power or other mechanical or technological
failures or interruptions, computer viruses or communications disruptions, acts
of war or terrorism, riots, revolutions, work stoppages, natural disasters or
other similar events or acts; (ii) errors by the Fund or its investment adviser
in their instructions to the Custodian provided such instructions have been in
accordance with this Contract; (iii) the insolvency of or acts or omissions by a
Securities System; (iv) any delay or failure of any broker, agent or
intermediary, central bank or other commercially prevalent payment or clearing
system to deliver to the Custodian's sub-custodian or agent securities purchased
or in the remittance or payment made in connection with securities sold; (v) any
delay or failure of any company, corporation, or other body in charge of
registering or transferring securities in the name of the Custodian, the Fund,
the Custodian's sub-custodians, nominees or agents or any consequential losses
arising out of such delay or failure to transfer such securities including
non-receipt of bonus, dividends and rights and other accretions or benefits;
(vi) delays or inability to perform its duties due to any disorder in market
infrastructure with respect to any particular security or Securities System; and
(vii) any provision of any present or future law or regulation or order of the
United States of America, or any state thereof, or any other country, or
political subdivision thereof or of any court of competent jurisdiction.

The Custodian shall be liable for the acts or omissions of a foreign banking
institution to the same extent as set forth with respect to sub-custodians
generally in this Contract.

                                       17
<PAGE>

If the Fund requires the Custodian to take any action with respect to
securities, which action involves the payment of money or which action may, in
the opinion of the Custodian, result in the Custodian or its nominee assigned to
the Fund being liable for the payment of money or incurring liability of some
other form, the Fund, as a prerequisite to requiring the Custodian to take such
action, shall provide indemnity to the Custodian in an amount and form
satisfactory to it.

If the Fund requires the Custodian, its affiliates, subsidiaries or agents, to
advance cash or securities for any purpose (including but not limited to
securities settlements, foreign exchange contracts and assumed settlement) or in
the event that the Custodian or its nominee shall incur or be assessed any
taxes, charges, expenses, assessments, claims or liabilities in connection with
the performance of this Contract, except such as may arise from its or its
nominee's own negligent action, negligent failure to act or willful misconduct,
any property at any time held for the account of the applicable Fund shall be
security therefor and should the Fund fail to repay the Custodian promptly, the
Custodian shall be entitled to utilize available cash and to dispose of such
Fund's assets to the extent necessary to obtain reimbursement.

14. Effective Period, Termination and Amendment

This Contract shall become effective as of its execution, shall continue in full
force and effect until terminated as hereinafter provided, may be amended at any
time by mutual agreement of the parties hereto and may be terminated by either
party by an instrument in writing delivered or mailed, postage prepaid to the
other party, such termination to take effect not sooner than thirty (30) days
after the date of such delivery or mailing; provided, however that the Custodian
shall not with respect to a Fund act under Section 2.10 hereof in the absence of
receipt of an initial certificate of the Secretary or an Assistant Secretary
that the Board of the Fund has approved the initial use of a particular
Securities System by such Fund and the receipt of an annual certificate of the
Secretary or Assistant Secretary that the Board of the Fund has reviewed any
subsequent change regarding the use by such Fund of such Securities System, as
required in each case by Rule 17f-4 under the Investment Company Act of 1940, as
amended and that the Custodian shall not with respect to a Fund act under
Section 2.11 hereof in the absence of receipt of an initial certificate of the
Secretary or an Assistant Secretary that the Board has approved the initial use
of the Direct Paper System by such Fund and the receipt of an annual certificate
of the Secretary or an Assistant Secretary that the Board of the Fund has
reviewed the use by such Fund of the Direct Paper System; provided further,
however, that the Fund shall not amend or terminate this Contract in
contravention of any applicable federal or state regulations, or any provision
of the Fund's governing documents, and further provided, that the Fund on behalf
of one or more of the Funds may at any time by action of its Board (i)
substitute another bank or trust company for the Custodian by giving notice as
described above to the Custodian, or (ii) immediately terminate this Contract in
the event of the appointment of a conservator or receiver for the Custodian by
the Comptroller of the Currency or upon the happening of a like event at the
direction of an appropriate regulatory agency or court of competent
jurisdiction.

                                       18
<PAGE>

Upon termination of the Contract, the Fund shall pay to the Custodian such
compensation as may be due as of the date of such termination and shall likewise
reimburse the Custodian for its costs, expenses and disbursements.

15. Successor Custodian

If a successor custodian for a Fund shall be appointed by the Board of Trustees
of such Fund, the Custodian shall, upon termination, deliver to such successor
custodian at the office of the Custodian, duly endorsed and in the form for
transfer, all securities, funds and other properties of each applicable Fund
then held by it hereunder and shall transfer to an account of the successor
custodian all of the securities of each such Fund held in a Securities System.

If no such successor custodian shall be appointed, the Custodian shall, in like
manner, upon receipt of a certified copy of a vote of the Board of Trustees of
the Fund, deliver at the office of the Custodian and transfer such securities,
funds and other properties in accordance with such vote.

In the event that no written order designating a successor custodian or
certified copy of a vote of the Board of Trustees shall have been delivered to
the Custodian on or before the date when such termination shall become
effective, then the Custodian shall have the right to deliver to a bank or trust
company, which is a "bank" as defined in the Investment Company Act of 1940,
doing business in Boston, Massachusetts, of its own selection, having an
aggregate capital, surplus, and undivided profits, as shown by its last
published report, of not less than $25,000,000, all securities, funds and other
properties held by the Custodian on behalf of each applicable Fund and all
instruments held by the Custodian relative thereto and all other property held
by it under this Contract on behalf of each applicable Fund and to transfer to
an account of such successor custodian all of the securities of each such Fund
held in any Securities System. Thereafter, such bank or trust company shall be
the successor of the Custodian under this Contract.

In the event that securities, funds and other properties remain in the
possession of the Custodian after the date of termination hereof owing to
failure of the Fund to procure the certified copy of the vote referred to or of
the Board of Trustees to appoint a successor custodian, the Custodian shall be
entitled to fair compensation for its services during such period as the
Custodian retains possession of such securities, funds and other properties and
the provisions of this Contract relating to the duties and obligations of the
Custodian shall remain in full force and effect.

16. Interpretive and Additional Provisions

In connection with the operation of this Contract, the Custodian and the Fund
may from time to time agree on such provisions interpretive of or in addition to
the provisions of this Contract as may in their joint opinion be consistent with
the general tenor of this Contract. Any such interpretive or additional
provisions shall be in a writing signed by both parties and shall be annexed
hereto, provided that no such interpretive or additional provisions shall
contravene any

                                       19
<PAGE>
applicable federal or state regulations or any provision of the governing
documents of the Fund. No interpretive or additional provisions made as provided
in the preceding sentence shall be deemed to be an amendment of this Contract.

17. Additional Funds

In the event that Van Kampen American Capital Distributors, Inc. establishes any
funds in addition to the Funds listed on Appendix A with respect to which it
desires to have the Custodian render services as custodian under the terms
hereof, it shall so notify the Custodian in writing, and if the Custodian agrees
in writing to provide such services, such fund shall become a Fund hereunder,
subject to the delivery by the new Fund of resolutions authorizing the
appointment of the Custodian and such other supporting or related documentation
as the Custodian may request. All references herein to the "Fund" are to each of
the Funds listed on Appendix A individually, as if this Contract were between
each such individual Fund and the Custodian. With respect to any Fund which
issues shares in separate classes or series, each class or series of such Fund
shall be treated as a separate Fund hereunder.

18. Massachusetts Law to Apply

This Contract shall be construed and the provisions thereof interpreted under
and in accordance with laws of The Commonwealth of Massachusetts.

19. Prior Contacts

This Contract supersedes and terminates, as of the date hereof, all prior
contracts between the Funds and the Custodian relating to the custody of the
Funds' assets.

20. Reproduction of Documents

This Contract and all schedules, exhibits, attachments and amendments hereto may
be reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties hereto all/each agree that
any such reproduction shall be admissible in evidence as the original itself in
any judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.

21. Shareholder Communications

Securities and Exchange Commission Rule 14b-2 requires banks which hold
securities for the account of customers to respond to requests by issuers of
securities for the names, addresses and holdings of beneficial owners of
securities of that issuer held by the bank unless the beneficial

                                       20
<PAGE>
owner has expressly objected to disclosure of this information. In order to
comply with the rule, the Custodian needs the Fund to indicate whether the Fund
authorizes the Custodian to provide the Fund's name, address, and share position
to requesting companies whose stock the Fund owns. If the Fund tells the
Custodian "no", the Custodian will not provide this information to requesting
companies. If the Fund tells the Custodian "yes" or do not check either "yes" or
"no" below, the Custodian is required by the rule to treat the Fund as
consenting to disclosure of this information for all securities owned by the
Fund or any funds or accounts established by the Fund. For the Fund's
protection, the Rule prohibits the requesting company from using the Fund's name
and address for any purpose other than corporate communications. Please indicate
below whether the Fund consent or object by checking one of the alternatives
below.

YES [_] The Custodian is authorized to release the Fund's name, address, and
share positions of each Fund listed on Exhibit A.

NO [X] The Custodian is not authorized to release the Fund's name, address, and
share positions of each Fund listed on Exhibit A.

21. Limitation of Liability.

The execution of this Contract has been authorized by each Fund's Board of
Trustees. This Contract is executed on behalf of each Fund or the trustees of
such Fund as trustees and not individually and the obligations of the Fund under
this Contract are not binding upon any of the Fund's trustees, officers or
shareholders individually but are binding only upon the assets and property of
the Fund.


                                       21



<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this instrument to be
executed in its name and behalf by its duly authorized representative and its
seal to be hereunder affixed as of the 1st day of August, 1997.

ATTEST                                  EACH OF THE FUNDS LISTED ON
                                    APPENDIX A

/s/ [Illegible]                       By /s/ [Illegible]
- ----------------------------------       -------------------------------------

                           Vice President & Secretary

ATTEST                                  STATE STREET BANK AND TRUST COMPANY

/s/ [Illegible]                       By /s/ [Illegible]
- ----------------------------------       -------------------------------------
                                    Executive Vice President

Schedule A

The following foreign banking institutions and foreign securities depositories
have been approved by the Board of Trustees of for use as sub-custodians for the
Fund's securities and other assets:

(Insert banks and securities depositories)

Certified: /s/ [Illegible]

Fund's Authorized Officer

Date: August 1, 1997

                                   SCHEDULE A

                      STATE STREET BANK AND TRUST COMPANY
                             GLOBAL CUSTODY NETWORK
                            FOR MUTUAL FUND CLIENTS
                                      1997

Country      Subcustodian                        Central Depository

Argentina    Citibank, N.A.                      Caja de Valores S.A.

Australia    Westpac Banking                     Austraclear Limited;
          Corporation


<PAGE>

                          Reserve Bank Information and
                             Transfer System (RITS)

Austria      GiroCredit Bank                     Oesterreichische
           Aktiengesellschaft                  Kontrollbank AG
           der Sparkassen                      (Wertpapiersammelbank Division)

Bangladesh   Standard Chartered Bank             None

Belgium      Generale Bank                       Caisse Interprofessionnelle
                                    de Depots et de Virements
                                    de Titres S.A. (CIK);

                                                 Banque Nationale de Belgique

Botswana     Barclays Bank of Botswana Limited   None

Brazil       Citibank, N.A.                      Bolsa de Valores de Sao Paulo
                                   (Bovespa);

                                    Banco Central do Brasil,
                                    Systema Especial de Liquidacao
                                    e Custodia (SELIC)

Canada       Canada Trustco                      The Canadian Depository
             Mortgage Company                    for Securities Limited (CDS)

Chile        Citibank, N.A.                      None

                       STATE STREET BANK AND TRUST COMPANY
                             GLOBAL CUSTODY NETWORK
                             FOR MUTUAL FUND CLIENTS
                                      1997


<PAGE>

Country                     Subcustodian                    Central Depository

People's Republic of China The Hongkong and Shanghai Shanghai Securities Central
                Banking Corporation Limited, Clearing and Registration
                Shanghai and Shenzhen branches Corporation (SSCCRC);

                                    Shenzhen Securities Central
                                    Clearing Co., Ltd. (SSCC)

Colombia                      Cititrust Colombia S.A.       None
                            Sociedad Fiduciaria

Cyprus                        Barclays Bank PLC             None
                            Cyprus Offshore Banking Unit

Czech Republic          Ceskoslovenska Obchodni         Stredisko Cennych Papiru
(SCP);
                        Banka A.S.

                                    Czech National Bank (CNB)

Denmark                   Den Danske Bank                 Vaerdipapircentralen -
                                          The Danish Securities
                                          Center (VP)

Ecuador                     Citibank, N.A.                  None

Egypt                     National Bank of Egypt            None

Finland                   Merita Bank Limited      The Central Share Register of
                                           Finland

France                    Banque Paribas            Societe Interprofessionnelle
                                          pour la Compensation des
                                          Valeurs Mobilieres (SICOVAM);


<PAGE>

                               Banque de France,
                                 Saturne System

Germany       Dresdner Bank A.G.             The Deutscher Kassenverein AG

Ghana       Barclays Bank of Ghana Limited   None

                       STATE STREET BANK AND TRUST COMPANY
                             GLOBAL CUSTODY NETWORK
                             FOR MUTUAL FUND CLIENTS
                                      1997

Country       Subcustodian                   Central Depository

Greece        National Bank of               The Central Securities Depository
           Greece S.A.                    (Aporhetirion Titlon A.E.)

Hong Kong     Standard Chartered Bank        The Central Clearing and
                            Settlement System (CCASS)

Hungary       Citibank Budapest Rt.          The Central Depository and Clearing
           House (Budapest) Ltd.

India         Deutsche Bank AG               None

           The Hongkong and Shanghai         None
           Banking Corporation Limited

Indonesia     Standard Chartered Bank        None

Ireland       Bank of Ireland                None;


<PAGE>

                          The Central Bank of Ireland,
                        The Gilt Settlement Office (GSO)

Israel        Bank Hapoalim B.M.             The Clearing House of the
                             Tel Aviv Stock Exchange

Italy         Banque Paribas                 Monte Titoli S.p.A.;

                             Banca d'Italia

Ivory Coast   Societe Generale de Banques    None
           en Cote d'Ivoire

                             Bank of Japan Net System

           The Fuji Bank, Limited        Japan Securities Depository Center
                                 (JASDEC);

                             Bank of Japan Net System

                       STATE STREET BANK AND TRUST COMPANY
                             GLOBAL CUSTODY NETWORK
                             FOR MUTUAL FUND CLIENTS
                                      1997

Country       Subcustodian                   Central Depository

Japan (cont.)   The Sumitomo Trust              Japan Securities Depostiory
             & Banking Co., Ltd.             Center (JASDEC);

                             Bank of Japan Net System


<PAGE>

Jordan        The British Bank of the Middle East  None

Kenya         Barclays Bank of Kenya Limited       None

Republic of Korea  SEOULBANK                   Korea Securities Depository (KSD)

Malaysia      Standard Chartered Bank          Malaysian Central Depository Sdn.
           Malaysia Berhad             Bhd. (MCD)

Mauritius     The HongKong and Shanghai            None
           Banking Corporation Limited

Mexico        Citibank Mexico, S.A.                S.D. INDEVAL, S.A. de C.V.
                                 (Instituto para el Deposito de
                                 Valores);

                                 Banco de Mexico

Morocco       Banque Commerciale du Maroc          None

Netherlands   MeesPierson N.V.                     Nederlands Centraal
                                 Instituut voor Giraal
                                 Effectenverkeer B.V.
                                 (NECIGEF)

New Zealand   ANZ Banking Group                   New Zealand Central Securities
           (New Zealand) Limited                Depository Limited (NZCSD)

Norway        Christiania Bank og                  Verdipapirsentralen -
           Kreditkasse                          The Norwegian Registry
                                             of Securities (VPS)

                       STATE STREET BANK AND TRUST COMPANY


<PAGE>

                             GLOBAL CUSTODY NETWORK
                             FOR MUTUAL FUND CLIENTS
                                      1997

Country          Subcustodian                  Central Depository

Pakistan         Deutsche Bank AG                None

Peru             Citibank, N.A.              Caja de Valores (CAVAL)

Philippines      Standard Chartered Bank         None

Poland           Citibank Poland S.A.          The National Depository
                                     of Securities (Centrum
                                     Krajowy Depozytu
                                     Papierow Wartos'ciowych);
                                     National Bank of Poland

Portugal         Banco Comercial Portugues     Central de Valores
                                     Mobiliarios (Central)

Russia           Credit Suisse First Boston, Zurich via  None
               Credit Suisse First Boston
               (Moscow) Limited

Singapore        The Development Bank                    The Central Depository
               of Singapore Ltd.                       (Pte) Limited (CDP)

Slovak Republic  Ceskoslovenska Obchadna       Stredisko cennych
         Banka A.S.                    papierov (SCP);

                                 National Bank of Slovakia

South Africa     Standard Bank of              The Central Depository Limited
          South Africa Limited


<PAGE>

Spain            Banco Santander, S.A.         Servicio de Compensacion y
                                      Liquidacion de Valores (SCLV);

                                      Banco de Espana,
                                      Anotaciones en Cuenta

Sri Lank         The Hongkong and Shanghai     The Central Depository
              Banking Corporation Limited   System (Pvt) Limited

Swaziland        Barclays Bank of Swaziland Limited      None

Sweden           Skandinaviska Enskilda        Vardepapperscentralen VPC AB -
              Banken                        The Swedish Central Securities
                                         Depository

                       STATE STREET BANK AND TRUST COMPANY
                             GLOBAL CUSTODY NETWORK
                             FOR MUTUAL FUND CLIENTS
                                      1997

Country         Subcustodian                   Central Depository

Switzerland     Union Bank of Switzerland      Schweizerische Effekten -
                                     Giro AG (SEGA)

Taiwan-R.O.C.   Central Trust of China         The Taiwan Securities
                                     Central Depository
                                     Company, Ltd.(TSCD)

Thailand        Standard Chartered Bank        Thailand Securities Depository
                                     Company Limited (TSD)

Turkey          Citibank, N.A.                 Takas ve Saklama Bankasi A.S.
                                    (TAKASBANK)


<PAGE>

                             Central Bank of Turkey

United Kingdom  State Street Bank and            None;
          Trust Company

                                     The Bank of England,
                                     The Central Gilts Office (CGO);
                                     The Central Moneymarkets Office
                                     (CMO)

Uruguay         Citibank, N.A.                   None

Venezuela       Citibank, N.A.                   None

Zambia          Barclays Bank of Zambia Limited  Lusaka Central Depository (LCD)

Zimbabwe        Barclays Bank of Zimbabwe Limited   None

Euroclear (The Euroclear System)/ State Street London Limited
Cedel (Cedel Bank societe anonyme)/ State Street London Limited



<PAGE>
Appendix A

Van Kampen American Capital Comstock Fund
Van Kampen American Capital Corporate Bond Fund
Van Kampen American Capital Emerging Growth Fund
Van Kampen American Capital Enterprise Fund
Van Kampen American Capital Equity Income Fund
Van Kampen American Capital Global Managed Assets Fund
Van Kampen American Capital Government Securities Fund
Van Kampen American Capital Government Target Fund
Van Kampen American Capital Growth and Income Fund
Van Kampen American Capital Harbor Fund
Van Kampen American Capital High Income Corporate Bond Fund

Van Kampen American Capital Life Investment Trust on behalf of its series

      Asset Allocation Portfolio
      Domestic Income Portfolio
      Emerging Growth Portfolio
      Enterprise Portfolio
      Global Equity Portfolio
      Government Portfolio
      Growth and Income Portfolio
      Money Market Portfolio
      Morgan Stanley Real Estate Securities Portfolio

Van Kampen American Capital Limited Maturity Government Fund
Van Kampen American Capital Pace Fund
Van Kampen American Capital Real Estate Securities Fund
Van Kampen American Capital Reserve Fund
Van Kampen American Capital Small Capitalization Fund

Van Kampen American Capital Tax-Exempt Trust on behalf of its series

      Van Kampen American Capital High Yield Municipal Fund

Van Kampen American Capital U.S. Government Trust for Income



                                       1

<PAGE>
Van Kampen American Capital World Portfolio Series Trust on behalf of its series

      Van Kampen American Capital Global Equity Fund
      Van Kampen American Capital Global Government Securities Fund

Van Kampen American Capital U.S. Government Trust

      Van Kampen American Capital U.S. Government Fund

Van Kampen American Capital Tax Free Trust

      Van Kampen American Capital Insured Tax Free Income Fund


      Van Kampen American Capital Tax Free High Income Fund
      Van Kampen American Capital California Insured Tax Free Fund
      Van Kampen American Capital Municipal Income Fund
      Van Kampen American Capital Intermediate Term Municipal Income Fund
      Van Kampen American Capital Florida Insured Tax Free Income Fund
      Van Kampen American Capital New Jersey Tax Free Income Fund
      Van Kampen American Capital New York Tax Free Income Fund

Van Kampen American Capital Trust

      Van Kampen American Capital High Yield Fund
      Van Kampen American Capital Short-Term Global Income Fund
      Van Kampen American Capital Strategic Income Fund

Van Kampen American Capital Equity Trust

      Van Kampen American Capital Utility Fund
      Van Kampen American Capital Value Fund
      Van Kampen American Capital Great American Companies Fund
      Van Kampen American Capital Growth Fund
      Van Kampen American Capital Prospector Fund
      Van Kampen American Capital Aggressive Growth Fund

Van Kampen American Capital Pennsylvania Tax Free Income Fund
Van Kampen American Capital Tax Free Money Fund
Van Kampen American Capital Foreign Securities Fund

The Explorer Institutional Trust

      Explorer Institutional Active Core Fund
      Explorer Institutional Limited Duration Fund

Van Kampen American Capital Navigator Funds

      Emerging Markets Equity Portfolio
      Emerging Markets Fixed Income Portfolio
      U.S. Quality Equity Portfolio

                                       2
<PAGE>

Van Kampen American Capital Exchange Fund
Van Kampen American Capital Municipal Income Trust
Van Kampen American Capital California Municipal Trust
Van Kampen American Capital High Income Trust

Van Kampen American Capital High Income Trust II
Van Kampen American Capital Investment Grade Municipal Trust
Van Kampen American Capital Prime Rate Income Trust
Van Kampen American Capital Municipal Trust
Van Kampen American Capital California Quality Municipal Trust

Van Kampen American Capital Florida Quality Municipal Trust
Van Kampen American Capital New York Quality Municipal Trust
Van Kampen American Capital Ohio Quality Municipal Trust
Van Kampen American Capital Pennsylvania Quality Municipal Trust
Van Kampen American Capital Trust for Insured Municipals

Van Kampen American Capital Trust for Investment Grade Municipals
Van Kampen American Capital Trust for Investment Grade California Municipals
Van Kampen American Capital Trust for Investment Grade Florida Municipals
Van Kampen American Capital Trust for Investment Grade New Jersey Municipals
Van Kampen American Capital Trust for Investment Grade New York Municipals

Van Kampen American Capital Trust for Pennsylvania Municipals
Van Kampen American Capital Municipal Opportunity Trust
Van Kampen American Capital Advantage Municipal Income Trust
Van Kampen American Capital Advantage Pennsylvania Municipal Income Trust
Van Kampen American Capital Strategic Sector Municipal Trust

Van Kampen American Capital Value Municipal Income Trust
Van Kampen American Capital California Value Municipal Income Trust
Van Kampen American Capital Massachusetts Value Municipal Income Trust
Van Kampen American Capital New Jersey Value Municipal Income Trust
Van Kampen American Capital New York Value Municipal Income Trust

Van Kampen American Capital Ohio Value Municipal Income Trust
Van Kampen American Capital Pennsylvania Value Municipal Income Trust
Van Kampen American Capital Municipal Opportunity Trust II

                                       3
<PAGE>


Van Kampen American Capital Florida Municipal Opportunity Trust
Van Kampen American Capital Advantage Municipal Income Trust II
Van Kampen American Capital Select Sector Municipal Trust
Van Kampen American Capital Bond Fund
Van Kampen American Capital Convertible Securities Fund
Van Kampen American Capital Income Trust

                                       4
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(9)(B)
<SEQUENCE>11
<FILENAME>c93084a1exv99wx9yxby.txt
<DESCRIPTION>AMENDMENT TO CUSTODIAN AGREEMENT
<TEXT>
<PAGE>

                                                                  EXHIBIT (9)(b)

                         AMENDMENT TO CUSTODIAN CONTRACT

         This Amendment to the Custodian Contract made as of May 24, 2001 by and
between each fund or series of a fund listed on Appendix A which evidences its
agreement to be bound hereby by executing a copy of this Amendment (each such
Fund is individually hereinafter referred to as the "Fund") and State Street
Bank and Trust Company (the "Custodian"). Capitalized terms used in this
Amendment without definition shall have the respective meanings given to such
terms in the Custodian Contract referred to below.

         WHEREAS, the Fund and the Custodian entered into a Custodian Contract
Agreement dated as of August 1, 1997 (the "Contract");

         WHEREAS, the Fund is authorized to issue shares in separate series,
with each such series representing interests in a separate portfolio of
securities and other assets, and the Fund has made each fund or series of a fund
listed on Appendix A subject to the Contract (each such series, together with
all other series subsequently established by the Fund and made subject to the
Contract in accordance with the terms thereof, shall be referred to as a
"Portfolio", and, collectively, the "Portfolios");

         WHEREAS, the Fund and the Custodian desire to amend certain provisions
of the Contract to reflect revisions to Rule 17f-5 ("Rule 17f-5") and the
adoption of Rule 17f-7 ("Rule 17f-7") promulgated under the Investment Company
Act of 1940, as amended (the "1940 Act"); and

         WHEREAS, the Fund and the Custodian desire to amend and restate certain
other provisions of the Contract relating to the custody of assets of each of
the Portfolios held outside of the United States.

         NOW THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements hereinafter contained, the parties hereby agree to
amend the Contract, pursuant to the terms thereof, as follows:

I.       Article 3 of the Contract is hereby deleted, and Articles 4 through 22
         of the Contract are hereby renumbered, as of the effective date of this
         Amendment, as Articles 5 through 23, respectively.

II.      New Articles 3 and 4 of the Contract are hereby added, as of the
         effective date of this Amendment, as set forth below.



<PAGE>

3.       PROVISIONS RELATING TO RULES 17f-5 AND 17f-7

3.1. DEFINITIONS. Capitalized terms in this Amendment shall have the following
meanings:

"Country Risk" means all factors reasonably related to the systemic risk of
holding Foreign Assets in a particular country including, but not limited to,
such country's political environment, economic and financial infrastructure
(including any Eligible Securities Depository operating in the country),
prevailing or developing custody and settlement practices, and laws and
regulations applicable to the safekeeping and recovery of Foreign Assets held in
custody in that country.

"Eligible Foreign Custodian" has the meaning set forth in section (a)(1) of Rule
17f-5, including a majority-owned or indirect subsidiary of a U.S. Bank (as
defined in Rule 17f-5), a bank holding company meeting the requirements of an
Eligible Foreign Custodian (as set forth in Rule 17f-5 or by other appropriate
action of the U.S. Securities and Exchange Commission (the "SEC")), or a foreign
branch of a Bank (as defined in Section 2(a)(5) of the 1940 Act) meeting the
requirements of a custodian under Section 17(f) of the 1940 Act; the term does
not include any Eligible Securities Depository.

"Eligible Securities Depository" has the meaning set forth in section (b)(1) of
Rule 17f-7.

"Foreign Assets" means any of the Portfolios' investments (including foreign
currencies) for which the primary market is outside the United States and such
cash and cash equivalents as are reasonably necessary to effect the Portfolios'
transactions in such investments.

"Foreign Custody Manager" has the meaning set forth in section (a)(3) of Rule
17f-5.

3.2. THE CUSTODIAN AS FOREIGN CUSTODY MANAGER.

         3.2.1 DELEGATION TO THE CUSTODIAN AS FOREIGN CUSTODY MANAGER. The Fund,
by resolution adopted by its Board of Trustees (the "Board"), hereby delegates
to the Custodian, subject to Section (b) of Rule 17f-5, the responsibilities set
forth in this Section 3.2 with respect to Foreign Assets of the Portfolios held
outside the United States, and the Custodian hereby accepts such delegation as
Foreign Custody Manager with respect to the Portfolios.

         3.2.2 COUNTRIES COVERED. The Foreign Custody Manager shall be
responsible for performing the delegated responsibilities defined below only
with respect to the countries and custody arrangements for each such country
listed on Schedule A to this Contract, which list of countries may be amended
from time to time by the Fund with the agreement of the Foreign Custody Manager.
The Foreign Custody Manager shall list on Schedule A the Eligible Foreign
Custodians selected by the Foreign Custody Manager to maintain the assets of the
Portfolios, which list of Eligible Foreign Custodians may be



                                       2
<PAGE>

amended from time to time in the sole discretion of the Foreign Custody Manager.
The Foreign Custody Manager will provide amended versions of Schedule A in
accordance with Section 3.2.5 hereof.

Upon the receipt by the Foreign Custody Manager of Proper Instructions to open
an account or to place or maintain Foreign Assets in a country listed on
Schedule A, and the fulfillment by the Fund, on behalf of the Portfolios, of the
applicable account opening requirements for such country, the Foreign Custody
Manager shall be deemed to have been delegated by the Board on behalf of the
Portfolios responsibility as Foreign Custody Manager with respect to that
country and to have accepted such delegation. Execution of this Amendment by the
Fund shall be deemed to be a Proper Instruction to open an account, or to place
or maintain Foreign Assets, in each country listed on Schedule A in which the
Custodian has previously placed or currently maintains Foreign Assets pursuant
to the terms of the Contract. Following the receipt of Proper Instructions
directing the Foreign Custody Manager to close the account of a Portfolio with
the Eligible Foreign Custodian selected by the Foreign Custody Manager in a
designated country, the delegation by the Board on behalf of the Portfolios to
the Custodian as Foreign Custody Manager for that country shall be deemed to
have been withdrawn and the Custodian shall immediately cease to be the Foreign
Custody Manager of the Portfolios with respect to that country.

The Foreign Custody Manager may withdraw its acceptance of delegated
responsibilities with respect to a designated country upon written notice to the
Fund. Thirty days (or such longer period to which the parties agree in writing)
after receipt of any such notice by the Fund, the Custodian shall have no
further responsibility in its capacity as Foreign Custody Manager to the Fund
with respect to the country as to which the Custodian's acceptance of delegation
is withdrawn.

         3.2.3 SCOPE OF DELEGATED RESPONSIBILITIES:

                  (a) SELECTION OF ELIGIBLE FOREIGN CUSTODIANS. Subject to the
provisions of this Section 3.2, the Foreign Custody Manager may place and
maintain the Foreign Assets in the care of the Eligible Foreign Custodian
selected by the Foreign Custody Manager in each country listed on Schedule A, as
amended from time to time. In performing its delegated responsibilities as
Foreign Custody Manager to place or maintain Foreign Assets with an Eligible
Foreign Custodian, the Foreign Custody Manager shall determine that the Foreign
Assets will be subject to reasonable care, based on the standards applicable to
custodians in the country in which the Foreign Assets will be held by that
Eligible Foreign Custodian, after considering all factors relevant to the
safekeeping of such assets, including, without limitation the factors specified
in Rule 17f-5(c)(1).

                  (b) CONTRACTS WITH ELIGIBLE FOREIGN CUSTODIANS. The Foreign
Custody Manager shall determine that the contract governing the foreign custody
arrangements with each Eligible Foreign Custodian selected by the Foreign
Custody Manager will satisfy the requirements of Rule 17f-5(c)(2).



                                       3
<PAGE>

                  (c) MONITORING. In each case in which the Foreign Custody
Manager maintains Foreign Assets with an Eligible Foreign Custodian selected by
the Foreign Custody Manager, the Foreign Custody Manager shall establish a
system to monitor (i) the appropriateness of maintaining the Foreign Assets with
such Eligible Foreign Custodian and (ii) the contract governing the custody
arrangements established by the Foreign Custody Manager with the Eligible
Foreign Custodian. In the event the Foreign Custody Manager determines that the
custody arrangements with an Eligible Foreign Custodian it has selected are no
longer appropriate, the Foreign Custody Manager shall notify the Board in
accordance with Section 3.2.5 hereunder.

         3.2.4 GUIDELINES FOR THE EXERCISE OF DELEGATED AUTHORITY. For purposes
of this Section 3.2, the Board shall be deemed to have considered and determined
to accept such Country Risk as is incurred by placing and maintaining the
Foreign Assets in each country for which the Custodian is serving as Foreign
Custody Manager of the Portfolios.

         3.2.5 REPORTING REQUIREMENTS. The Foreign Custody Manager shall report
the withdrawal of the Foreign Assets from an Eligible Foreign Custodian and the
placement of such Foreign Assets with another Eligible Foreign Custodian by
providing to the Board an amended Schedule A at the end of the calendar quarter
in which an amendment to such Schedule has occurred. The Foreign Custody Manager
shall make written reports notifying the Board of any other material change in
the foreign custody arrangements of the Portfolios described in this Section 3.2
after the occurrence of the material change.

         3.2.6 STANDARD OF CARE AS FOREIGN CUSTODY MANAGER OF A PORTFOLIO. In
performing the responsibilities delegated to it, the Foreign Custody Manager
agrees to exercise reasonable care, prudence and diligence such as a person
having responsibility for the safekeeping of assets of management investment
companies registered under the 1940 Act would exercise.

         3.2.7 REPRESENTATIONS WITH RESPECT TO RULE 17f-5. The Foreign Custody
Manager represents to the Fund that it is a U.S. Bank as defined in section
(a)(7) of Rule 17f-5. The Fund represents to the Custodian that the Board has
determined that it is reasonable for the Board to rely on the Custodian to
perform the responsibilities delegated pursuant to this Contract to the
Custodian as the Foreign Custody Manager of the Portfolios.

         3.2.8 EFFECTIVE DATE AND TERMINATION OF THE CUSTODIAN AS FOREIGN
CUSTODY MANAGER. The Board's delegation to the Custodian as Foreign Custody
Manager of the Portfolios shall be effective as of the date hereof and shall
remain in effect until terminated at any time, without penalty, by written
notice from the terminating party to the non-terminating party. Termination will
become effective thirty (30) days after receipt by the non-terminating party of
such notice. The provisions of Section 3.2.2 hereof shall govern the delegation
to and termination of the Custodian as Foreign Custody Manager of the Portfolios
with respect to designated countries.



                                       4
<PAGE>

3.3 ELIGIBLE SECURITIES DEPOSITORIES.

         3.3.1 ANALYSIS AND MONITORING. The Custodian shall (a) provide the Fund
(or its duly-authorized investment manager or investment adviser) with an
analysis of the custody risks associated with maintaining assets with the
Eligible Securities Depositories set forth on Schedule B hereto in accordance
with section (a)(1)(i)(A) of Rule 17f-7, and (b) monitor such risks on a
continuing basis, and promptly notify the Fund (or its duly-authorized
investment manager or investment adviser) of any material change in such risks,
in accordance with section (a)(1)(i)(B) of Rule 17f-7.

         3.3.2 STANDARD OF CARE. The Custodian agrees to exercise reasonable
care, prudence and diligence in performing the duties set forth in Section
3.3.1.

4.       DUTIES OF THE CUSTODIAN WITH RESPECT TO PROPERTY OF THE PORTFOLIOS HELD
         OUTSIDE THE UNITED STATES.

4.1 DEFINITIONS. Capitalized terms in this Article 4 shall have the following
meanings:

"Foreign Securities System" means an Eligible Securities Depository listed on
Schedule B hereto.

"Foreign Sub-Custodian" means a foreign banking institution serving as an
Eligible Foreign Custodian.

4.2. HOLDING SECURITIES. The Custodian shall identify on its books as belonging
to the Portfolios the foreign securities held by each Foreign Sub-Custodian or
Foreign Securities System. The Custodian may hold foreign securities for all of
its customers, including the Portfolios, with any Foreign Sub-Custodian in an
account that is identified as belonging to the Custodian for the benefit of its
customers, provided however, that (i) the records of the Custodian with respect
to foreign securities of the Portfolios which are maintained in such account
shall identify those securities as belonging to the Portfolios and (ii), to the
extent permitted and customary in the market in which the account is maintained,
the Custodian shall require that securities so held by the Foreign Sub-Custodian
be held separately from any assets of such Foreign Sub-Custodian or of other
customers of such Foreign Sub-Custodian.

4.3. FOREIGN SECURITIES SYSTEMS. Foreign securities shall be maintained in a
Foreign Securities System in a designated country through arrangements
implemented by the Custodian or a Foreign Sub-Custodian, as applicable, in such
country.

4.4. TRANSACTIONS IN FOREIGN CUSTODY ACCOUNT.

         4.4.1. DELIVERY OF FOREIGN ASSETS. The Custodian or a Foreign
Sub-Custodian shall release and deliver foreign securities of the Portfolios
held by the Custodian or such Foreign Sub-Custodian, or in a Foreign Securities
System account, only upon receipt of



                                       5
<PAGE>

Proper Instructions, which may be continuing instructions when deemed
appropriate by the parties, and only in the following cases:

         (i)      upon the sale of such foreign securities for the Portfolio in
                  accordance with commercially reasonable market practice in the
                  country where such foreign securities are held or traded,
                  including, without limitation: (A) delivery against
                  expectation of receiving later payment; or (B) in the case of
                  a sale effected through a Foreign Securities System, in
                  accordance with the rules governing the operation of the
                  Foreign Securities System;

         (ii)     in connection with any repurchase agreement related to foreign
                  securities;

         (iii)    to the depository agent in connection with tender or other
                  similar offers for foreign securities of the Portfolios;

         (iv)     to the issuer thereof or its agent when such foreign
                  securities are called, redeemed, retired or otherwise become
                  payable;

         (v)      to the issuer thereof, or its agent, for transfer into the
                  name of the Custodian (or the name of the respective Foreign
                  Sub-Custodian or of any nominee of the Custodian or such
                  Foreign Sub-Custodian) or for exchange for a different number
                  of bonds, certificates or other evidence representing the same
                  aggregate face amount or number of units;

         (vi)     to brokers, clearing banks or other clearing agents for
                  examination or trade execution in accordance with market
                  custom; provided that in any such case the Foreign
                  Sub-Custodian shall have no responsibility or liability for
                  any loss arising from the delivery of such securities prior to
                  receiving payment for such securities except as may arise from
                  the Foreign Sub-Custodian's own negligence or willful
                  misconduct;

         (vii)    for exchange or conversion pursuant to any plan of merger,
                  consolidation, recapitalization, reorganization or
                  readjustment of the securities of the issuer of such
                  securities, or pursuant to provisions for conversion contained
                  in such securities, or pursuant to any deposit agreement;

         (viii)   in the case of warrants, rights or similar foreign securities,
                  the surrender thereof in the exercise of such warrants, rights
                  or similar securities or the surrender of interim receipts or
                  temporary securities for definitive securities;

         (ix)     for delivery as security in connection with any borrowing by
                  the Portfolios requiring a pledge of assets by the Portfolios;

         (x)      in connection with trading in options and futures contracts,
                  including delivery as original margin and variation margin;



                                       6
<PAGE>

         (xi)     in connection with the lending of foreign securities; and

         (xii)    for any other purpose, but only upon receipt of Proper
                  Instructions specifying the foreign securities to be delivered
                  and naming the person or persons to whom delivery of such
                  securities shall be made.

         4.4.2. PAYMENT OF PORTFOLIO MONIES. Upon receipt of Proper
Instructions, which may be continuing instructions when deemed appropriate by
the parties, the Custodian shall pay out, or direct the respective Foreign
Sub-Custodian or the respective Foreign Securities System to pay out, monies of
a Portfolio in the following cases only:

         (i)      upon the purchase of foreign securities for the Portfolio,
                  unless otherwise directed by Proper Instructions, by (A)
                  delivering money to the seller thereof or to a dealer therefor
                  (or an agent for such seller or dealer) against expectation of
                  receiving later delivery of such foreign securities; or (B) in
                  the case of a purchase effected through a Foreign Securities
                  System, in accordance with the rules governing the operation
                  of such Foreign Securities System;

         (ii)     in connection with the conversion, exchange or surrender of
                  foreign securities of the Portfolio;

         (iii)    for the payment of any expense or liability of the Portfolio,
                  including but not limited to the following payments: interest,
                  taxes, investment advisory fees, transfer agency fees, fees
                  under this Contract, legal fees, accounting fees, and other
                  operating expenses;

         (iv)     for the purchase or sale of foreign exchange or foreign
                  exchange contracts for the Portfolio, including transactions
                  executed with or through the Custodian or its Foreign
                  Sub-Custodians;

         (v)      in connection with trading in options and futures contracts,
                  including delivery as original margin and variation margin;

         (vi)     for payment of part or all of the dividends received in
                  respect of securities sold short;

         (vii)    in connection with the borrowing or lending of foreign
                  securities; and

         (viii)   for any other purpose, but only upon receipt of Proper
                  Instructions specifying the amount of such payment and naming
                  the person or persons to whom such payment is to be made.

         4.4.3. MARKET CONDITIONS. Notwithstanding any provision of this
Contract to the contrary, settlement and payment for Foreign Assets received for
the account of the Portfolios and delivery of Foreign Assets maintained for the
account of the Portfolios



                                       7
<PAGE>

may be effected in accordance with the customary established securities trading
or processing practices and procedures in the country or market in which the
transaction occurs, including, without limitation, delivering Foreign Assets to
the purchaser thereof or to a dealer therefor (or an agent for such purchaser or
dealer) with the expectation of receiving later payment for such Foreign Assets
from such purchaser or dealer.

The Custodian shall provide to the Board the information with respect to custody
and settlement practices in countries in which the Custodian employs a Foreign
Sub-Custodian described on Schedule C hereto at the time or times set forth on
such Schedule. The Custodian may revise Schedule C from time to time, provided
that no such revision shall result in the Board being provided with
substantively less information than had been previously provided hereunder.

4.5. REGISTRATION OF FOREIGN SECURITIES. The foreign securities maintained in
the custody of a Foreign Sub-Custodian (other than bearer securities) shall be
registered in the name of the applicable Portfolio or in the name of the
Custodian or in the name of any Foreign Sub-Custodian or in the name of any
nominee of the foregoing, and the Fund on behalf of such Portfolio agrees to
hold any such nominee harmless from any liability as a holder of record of such
foreign securities. The Custodian or a Foreign Sub-Custodian shall not be
obligated to accept securities on behalf of a Portfolio under the terms of this
Contract unless the form of such securities and the manner in which they are
delivered are in accordance with reasonable market practice.

4.6 BANK ACCOUNTS. The Custodian shall identify on its books as belonging to the
Fund cash (including cash denominated in foreign currencies) deposited with the
Custodian. Where the Custodian is unable to maintain, or market practice does
not facilitate the maintenance of, cash on the books of the Custodian, a bank
account or bank accounts shall be opened and maintained outside the United
States on behalf of a Portfolio with a Foreign Sub-Custodian. All accounts
referred to in this Section shall be subject only to draft or order by the
Custodian (or, if applicable, such Foreign Sub-Custodian) acting pursuant to the
terms of this Agreement to hold cash received by or from or for the account of
the Portfolio. Cash maintained on the books of the Custodian (including its
branches, subsidiaries and affiliates), regardless of currency denomination, is
maintained in bank accounts established under, and subject to the laws of, The
Commonwealth of Massachusetts.

4.7. COLLECTION OF INCOME. The Custodian shall use reasonable commercial efforts
to collect all income and other payments with respect to the Foreign Assets held
hereunder to which the Portfolios shall be entitled and shall credit such
income, as collected, to the applicable Portfolio. In the event that
extraordinary measures are required to collect such income, the Fund and the
Custodian shall consult as to such measures and as to the compensation and
expenses of the Custodian relating to such measures.

4.8 SHAREHOLDER RIGHTS. With respect to the foreign securities held pursuant to
this Article 4, the Custodian will use reasonable commercial efforts to
facilitate the exercise of voting and other shareholder rights, subject always
to the laws, regulations and practical constraints that may exist in the country
where such securities are issued. The



                                       8
<PAGE>

Fund acknowledges that local conditions, including lack of regulation, onerous
procedural obligations, lack of notice and other factors may have the effect of
severely limiting the ability of the Fund to exercise shareholder rights.

4.9. COMMUNICATIONS RELATING TO FOREIGN SECURITIES. The Custodian shall transmit
promptly to the Fund written information with respect to materials received by
the Custodian via the Foreign Sub-Custodians from issuers of the foreign
securities being held for the account of the Portfolios (including, without
limitation, pendency of calls and maturities of foreign securities and
expirations of rights in connection therewith). With respect to tender or
exchange offers, the Custodian shall transmit promptly to the Fund written
information with respect to materials so received by the Custodian from issuers
of the foreign securities whose tender or exchange is sought or from the party
(or its agents) making the tender or exchange offer. The Custodian shall not be
liable for any untimely exercise of any tender, exchange or other right or power
in connection with foreign securities or other property of the Portfolios at any
time held by it unless (i) the Custodian or the respective Foreign Sub-Custodian
is in actual possession of such foreign securities or property and (ii) the
Custodian receives Proper Instructions with regard to the exercise of any such
right or power, and both (i) and (ii) occur at least three business days prior
to the date on which the Custodian is to take action to exercise such right or
power.

4.10. LIABILITY OF FOREIGN SUB-CUSTODIANS. Each agreement pursuant to which the
Custodian employs a Foreign Sub-Custodian shall, to the extent possible, require
the Foreign Sub-Custodian to exercise reasonable care in the performance of its
duties, and to indemnify, and hold harmless, the Custodian from and against any
loss, damage, cost, expense, liability or claim arising out of or in connection
with the Foreign Sub-Custodian's performance of such obligations. At the Fund's
election, the Portfolios shall be entitled to be subrogated to the rights of the
Custodian with respect to any claims against a Foreign Sub-Custodian as a
consequence of any such loss, damage, cost, expense, liability or claim if and
to the extent that the Portfolios have not been made whole for any such loss,
damage, cost, expense, liability or claim.

4.11. TAX LAW. The Custodian shall have no responsibility or liability for any
obligations now or hereafter imposed on the Fund, the Portfolios or the
Custodian as custodian of the Portfolios by the tax law of the United States or
of any state or political subdivision thereof. It shall be the responsibility of
the Fund to notify the Custodian of the obligations imposed on the Fund with
respect to the Portfolios or the Custodian as custodian of the Portfolios by the
tax law of countries other than those mentioned in the above sentence, including
responsibility for withholding and other taxes, assessments or other
governmental charges, certifications and governmental reporting. The sole
responsibility of the Custodian with regard to such tax law shall be to use
reasonable efforts to assist the Fund with respect to any claim for exemption or
refund under the tax law of countries for which the Fund has provided such
information.

4.12. LIABILITY OF CUSTODIAN. Except as may arise from the Custodian's own
negligence or willful misconduct or the negligence or willful misconduct of a
Sub-Custodian, the Custodian shall be without liability to the Fund for any
loss, liability, claim or expense resulting from or caused by anything which is
part of Country Risk.



                                       9
<PAGE>

The Custodian shall be liable for the acts or omissions of a Foreign
Sub-Custodian to the same extent as set forth with respect to sub-custodians
generally in the Contract and, regardless of whether assets are maintained in
the custody of a Foreign Sub-Custodian or a Foreign Securities System, the
Custodian shall not be liable for any loss, damage, cost, expense, liability or
claim resulting from nationalization, expropriation, currency restrictions, or
acts of war or terrorism, or any other loss where the Sub-Custodian has
otherwise acted with reasonable care.

III.     Except as specifically superseded or modified herein, the terms and
         provisions of the Contract shall continue to apply with full force and
         effect. In the event of any conflict between the terms of the Contract
         prior to this Amendment and this Amendment, the terms of this Amendment
         shall prevail. If the Custodian is delegated the responsibilities of
         Foreign Custody Manager pursuant to the terms of Article 3 hereof, in
         the event of any conflict between the provisions of Articles 3 and 4
         hereof, the provisions of Article 3 shall prevail.


                    [Remainder of page intentionally blank.]



                                       10
<PAGE>

         IN WITNESS WHEREOF, each of the parties has caused this Amendment to be
executed in its name and behalf by its duly authorized representative as of the
date first above written.



WITNESSED BY:                   STATE STREET BANK and TRUST COMPANY




                                By:
- ---------------------------            -----------------------------------------
Raelene S. LaPlante             Name:  Ronald E. Logue
V.P. and Assoc. Counsel         Title: Vice Chairman and Chief Operating Officer





WITNESSED BY:                   EACH OF THE FUNDS LISTED ON
                                APPENDIX A




                                By:
- ---------------------------            -----------------------------------------
Sara L. Badler                  Name:  A. Thomas Smith III
Assistant Secretary             Title: Vice President and Secretary





                                       11
<PAGE>

                                   APPENDIX A
                               As of May 24, 2001


Van Kampen Comstock Fund
Van Kampen Corporate Bond Fund
Van Kampen Emerging Growth Fund
Van Kampen Enterprise Fund
Van Kampen Equity Income Fund
Van Kampen Government Securities Fund
Van Kampen Growth and Income Fund
Van Kampen Harbor Fund
Van Kampen High Income Corporate Bond Fund

VAN KAMPEN LIFE INVESTMENT TRUST
On behalf of its series
     Aggressive Growth Portfolio
     Asset Allocation Portfolio
     Comstock Portfolio
     Domestic Income portfolio
     Emerging Growth Portfolio
     Enterprise Portfolio
     Global Equity Portfolio
     Government Portfolio
     Growth and income Portfolio
     Money Market portfolio
     Select Growth Portfolio
     Strategic Stock Portfolio
     Technology Portfolio

Van Kampen Limited Maturity Government Fund
Van Kampen Pace Fund
Van Kampen Real Estate Securities Fund
Van Kampen Reserve Fund

VAN KAMPEN TAX-EXEMPT TRUST
On behalf of its series
     Van Kampen Technology Fund

Van Kampen U.S. Government Trust for Income

VAN KAMPEN EQUITY TRUST II
On behalf of its series
     Van Kampen Tax Managed Equity Growth Fund
     Van Kampen Technology Fund



                                        i
<PAGE>

                                   APPENDIX A
                               As of May 24, 2001


Van Kampen Municipal Income Trust
Van Kampen California Municipal Trust
Van Kampen High Income Trust
Van Kampen High Income Trust II
Van Kampen Investment Grade Municipal Trust

Van Kampen Prime Rate Income Trust
Van Kampen Senior Income Trust
Van Kampen Senior Floating Rate Fund

Van Kampen Municipal Trust
Van Kampen California Quality Municipal Trust
Van Kampen Florida Quality Municipal Trust
Van Kampen New York Quality Municipal Trust
Van Kampen Ohio Quality Municipal Trust
Van Kampen Pennsylvania Quality Municipal Trust
Van Kampen Trust for Insured Municipals
Van Kampen Trust for Investment Grade Municipals
Van Kampen Trust for Investment Grade California Municipals

Van Kampen Trust for Investment Grade Florida Municipals
Van Kampen Trust for Investment Grade New Jersey Municipals
Van Kampen Trust for Investment Grade New York Municipals
Van Kampen Trust for Investment Grade Pennsylvania Municipals
Van Kampen Municipal Opportunity Trust

Van Kampen Advantage Municipal Income Trust
Van Kampen Advantage Pennsylvania Municipal Income Trust
Van Kampen Strategic Sector Municipal Trust

Van Kampen Value Municipal Income Trust
Van Kampen California Value Municipal Income Trust
Van Kampen Massachusetts Value Municipal Income Trust
Van Kampen New York Value Municipal Income Trust
Van Kampen Ohio Value Municipal Income Trust
Van Kampen Pennsylvania Value Municipal Income Trust

Van Kampen Municipal Opportunity Trust II
Van Kampen Advantage Municipal Income Trust II
Van Kampen Select Sector Municipal Trust

Van Kampen Bond Fund
Van Kampen Income Trust



                                       ii
<PAGE>

                                   APPENDIX A
                               As of May 24, 2001


VAN KAMPEN U.S. GOVERNMENT TRUST
On behalf of its series
     Van Kampen U.S. Government Fund

VAN KAMPEN TAX FREE TRUST
On behalf of its series
     Van Kampen Insured Tax Free Income Fund
     Van Kampen Tax Free High Income Fund
     Van Kampen California Insured Tax Free Fund
     Van Kampen Municipal Income Fund
     Van Kampen Intermediate Term Municipal Income Fund
     Van Kampen Florida Insured Tax Free Income Fund
     Van Kampen New York Insured Tax Free Income Fund

VAN KAMPEN TRUST
On behalf of its series
     Van Kampen High Yield Fund
     Van Kampen Managed Short Term Income Fund

VAN KAMPEN EQUITY TRUST
On behalf of its series
     Van Kampen Utility Fund
     Van Kampen Growth Fund
     Van Kampen Aggressive Growth Fund
     Van Kampen Small Cap Value Fund
     Van Kampen Small Cap Growth Fund
     Van Kampen Small Company Growth Fund
     Van Kampen Select Growth Fund
     Van Kampen Value Opportunities Fund

Van Kampen Pennsylvania Tax Free Income Fund
Van Kampen Tax Free Money Fund


Van Kampen Exchange Fund




                                       iii
<PAGE>

                                  STATE STREET                        SCHEDULE A
                             GLOBAL CUSTODY NETWORK
                                  SUBCUSTODIANS


<Table>
<Caption>
COUNTRY                    SUBCUSTODIAN
<S>                       <C>

Argentina                  Citibank, N.A.


Australia                  Westpac Banking Corporation


Austria                    Erste Bank der Osterreichischen
                           Sparkassen AG


Bahrain                    HSBC Bank Middle East
                           (as delegate of The Hongkong and
                           Shanghai Banking Corporation Limited)


Bangladesh                 Standard Chartered Bank


Belgium                    Fortis Bank nv-sa


Bermuda                    The Bank of Bermuda Limited


Bolivia                    Citibank, N. A.


Botswana                   Barclays Bank of Botswana Limited


Brazil                     Citibank, N.A.


Bulgaria                   ING Bank N.V.


Canada                     State Street Trust Company Canada


Chile                      Citibank, N.A.


People's Republic          The Hongkong and Shanghai
of China                   Banking Corporation Limited,
                           Shanghai and Shenzhen branches


Colombia                   Cititrust Colombia S.A. Sociedad Fiduciaria
</Table>




12/11/01                               1
<PAGE>

                                  STATE STREET                        SCHEDULE A
                             GLOBAL CUSTODY NETWORK
                                  SUBCUSTODIANS


<Table>
<Caption>
COUNTRY                    SUBCUSTODIAN
<S>                       <C>

Costa Rica                 Banco BCT S.A.


Croatia                    Privredna Banka Zagreb d.d


Cyprus                     The Cyprus Popular Bank Ltd.


Czech Republic             Ceskoslovenska Obchodni
                           Banka, A.S.


Denmark                    Den Danske Bank


Ecuador                    Citibank, N.A.


Egypt                      Egyptian British Bank S.A.E.
                           (as delegate of The Hongkong
                           and Shanghai Banking Corporation
                           Limited)


Estonia                    Hansabank


Finland                    Merita Bank Plc.


France                     BNP Paribas, S.A.


Germany                    Dresdner Bank AG


Ghana                      Barclays Bank of Ghana Limited


Greece                     National Bank of Greece S.A.


Hong Kong                  Standard Chartered Bank


Hungary                    Citibank Rt.
</Table>




12/11/01                               2
<PAGE>

                                  STATE STREET                        SCHEDULE A
                             GLOBAL CUSTODY NETWORK
                                  SUBCUSTODIANS


<Table>
<Caption>
COUNTRY                    SUBCUSTODIAN
<S>                       <C>

Iceland                    Icebank Ltd.


India                      Deutsche Bank AG

                           The Hongkong and Shanghai
                           Banking Corporation Limited


Indonesia                  Standard Chartered Bank


Ireland                    Bank of Ireland


Israel                     Bank Hapoalim B.M.


Italy                      BNP Paribas, Italian Branch


Ivory Coast                Societe Generale de Banques
                           en Cote d'Ivoire


Jamaica                    Scotiabank Jamaica Trust and Merchant
                           Bank Ltd.


Japan                      The Fuji Bank, Limited

                           The Sumitomo Bank, Limited


Jordan                     HSBC Bank Middle East
                           (as delegate of The Hongkong and
                           Shanghai Banking Corporation Limited)


Kazakhstan                 HSBC Bank Kazakhstan


Kenya                      Barclays Bank of Kenya Limited


Republic of Korea          The Hongkong and Shanghai Banking
                           Corporation Limited
</Table>




12/11/01                               3
<PAGE>

                                  STATE STREET                        SCHEDULE A
                             GLOBAL CUSTODY NETWORK
                                  SUBCUSTODIANS


<Table>
<Caption>
COUNTRY                    SUBCUSTODIAN
<S>                       <C>

Latvia                     A/s Hansabanka


Lebanon                    HSBC Bank Middle East
                           (as delegate of The Hongkong and
                           Shanghai Banking Corporation Limited)


Lithuania                  Vilniaus Bankas AB


Malaysia                   Standard Chartered Bank Malaysia Berhad


Mauritius                  The Hongkong and Shanghai
                           Banking Corporation Limited


Mexico                     Citibank Mexico, S.A.


Morocco                    Banque Commerciale du Maroc


Namibia                    Standard Bank Namibia Limited               -


Netherlands                Fortis Bank (Nederland) N.V.


New Zealand                ANZ Banking Group (New Zealand) Limited


Nigeria                    Stanbic Merchant Bank Nigeria Limited


Norway                     Christiania Bank og Kreditkasse ASA


Oman                       HSBC Bank Middle East
                           (as delegate of The Hongkong and
                           Shanghai Banking Corporation Limited)


Pakistan                   Deutsche Bank AG


Palestine                  HSBC Bank Middle East
                           (as delegate of The Hongkong and
                           Shanghai Banking Corporation Limited)
</Table>



12/11/01                               4
<PAGE>

                                  STATE STREET                        SCHEDULE A
                             GLOBAL CUSTODY NETWORK
                                  SUBCUSTODIANS


<Table>
<Caption>
COUNTRY                    SUBCUSTODIAN
<S>                       <C>

Panama                     BankBoston, N.A.


Peru                       Citibank, N.A.


Philippines                Standard Chartered Bank


Poland                     Citibank (Poland) S.A.


Portugal                   Banco Comercial Portugues


Qatar                      HSBC Bank Middle East
                           (as delegate of The Hongkong and
                           Shanghai Banking Corporation Limited)

Romania                    ING Bank N.V.


Russia                     Credit Suisse First Boston AO - Moscow
                           (as delegate of Credit Suisse
                           First Boston - Zurich)


Singapore                  The Development Bank of Singapore Limited


Slovak Republic            Ceskoslovenska Obchodni Banka, A.S.


Slovenia                   Bank Austria Creditanstalt d.d. - Ljubljana


South Africa               Standard Bank of South Africa Limited


Spain                      Banco Santander Central Hispano S.A.


Sri Lanka                  The Hongkong and Shanghai
                           Banking Corporation Limited


Swaziland                  Standard Bank Swaziland Limited
</Table>




12/11/01                               5
<PAGE>

                                  STATE STREET                        SCHEDULE A
                             GLOBAL CUSTODY NETWORK
                                  SUBCUSTODIANS


<Table>
<Caption>
COUNTRY                    SUBCUSTODIAN
<S>                       <C>

Sweden                     Skandinaviska Enskilda Banken


Switzerland                UBS AG


Taiwan - R.O.C.            Central Trust of China


Thailand                   Standard Chartered Bank


Trinidad & Tobago          Republic Bank Limited


Tunisia                    Banque Internationale Arabe de Tunisie


Turkey                     Citibank, N.A.


Ukraine                    ING Bank Ukraine


United Kingdom             State Street Bank and Trust Company,
                           London Branch


Uruguay                    BankBoston, N.A.


Venezuela                  Citibank, N.A.


Vietnam                    The Hongkong and Shanghai
                           Banking Corporation Limited


Zambia                     Barclays Bank of Zambia Limited


Zimbabwe                   Barclays Bank of Zimbabwe Limited
</Table>



12/11/01                               6
<PAGE>

                                   STATE STREET                       SCHEDULE B
                             GLOBAL CUSTODY NETWORK
                    DEPOSITORIES OPERATING IN NETWORK MARKETS


<Table>
<Caption>
         COUNTRY                                              DEPOSITORIES
<S>                                                          <C>

         Argentina                                            Caja de Valores S.A.


         Australia                                            Austraclear Limited

                                                              Reserve Bank Information and
                                                              Transfer System


         Austria                                              Oesterreichische Kontrollbank AG
                                                              (Wertpapiersammelbank Division)


         Belgium                                              Caisse Interprofessionnelle de Depots et
                                                              de Virements de Titres, S.A.

                                                              Banque Nationale de Belgique


         Brazil                                               Companhia Brasileira de Liquidacao e Custodia


         Bulgaria                                             Central Depository AD

                                                              Bulgarian National Bank


         Canada                                               Canadian Depository for Securities Limited


         Chile                                                Deposito Central de Valores S.A.


         People's Republic                                    Shanghai Securities Central Clearing &
         of China                                             Registration Corporation

                                                              Shenzhen Securities Central Clearing Co., Ltd.


         Colombia                                             Deposito Centralizado de Valores


         Costa Rica                                           Central de Valores S.A.
</Table>



10/12/00                               1
<PAGE>

                                   STATE STREET                       SCHEDULE B
                             GLOBAL CUSTODY NETWORK
                    DEPOSITORIES OPERATING IN NETWORK MARKETS


<Table>
<Caption>
         COUNTRY                                              DEPOSITORIES
<S>                                                          <C>

         Croatia                                              Ministry of Finance

                                                              National Bank of Croatia

                                                              Sredisnja Depozitarna Agencija d.d.


         Czech Republic                                       Stredisko cennych papiru

                                                              Czech National Bank


         Denmark                                              Vaerdipapircentralen (Danish Securities Center)


         Egypt                                                Misr for Clearing, Settlement, and Depository


         Estonia                                              Eesti Vaartpaberite Keskdepositoorium


         Finland                                              Finnish Central Securities Depository


         France                                               Societe Interprofessionnelle pour la Compensation
                                                              des Valeurs Mobilieres


         Germany                                              Clearstream Banking AG, Frankfurt


         Greece                                               Bank of Greece,
                                                              System for Monitoring Transactions in
                                                              Securities in Book-Entry Form

                                                              Apothetirion Titlon AE - Central Securities
         Depository


         Hong Kong                                            Central Clearing and Settlement System

                                                              Central Moneymarkets Unit


         Hungary                                              Kozponti Elszamolohaz es Ertektar
                                                              (Budapest) Rt. (KELER)
</Table>



10/12/00                               2
<PAGE>

                                   STATE STREET                       SCHEDULE B
                             GLOBAL CUSTODY NETWORK
                    DEPOSITORIES OPERATING IN NETWORK MARKETS


<Table>
<Caption>
         COUNTRY                                              DEPOSITORIES
<S>                                                          <C>

         India                                                National Securities Depository Limited

                                                              Central Depository Services India Limited

                                                              Reserve Bank of India


         Indonesia                                            Bank Indonesia

                                                              PT Kustodian Sentral Efek Indonesia


         Ireland                                              Central Bank of Ireland
                                                              Securities Settlement Office


         Israel                                               Tel Aviv Stock Exchange Clearing
                                                              House Ltd. (TASE Clearinghouse)


         Italy                                                Monte Titoli S.p.A.

                                                              Banca d'Italia


         Ivory Coast                                          Depositaire Central - Banque de Reglement


         Jamaica                                              Jamaica Central Securities Depository


         Japan                                                Japan Securities Depository Center (JASDEC)
                                                              Bank of Japan Net System


         Kazakhstan                                           Central Depository of Securities


         Kenya                                                Central Bank of Kenya


         Republic of Korea                                    Korea Securities Depository


         Latvia                                               Latvian Central Depository
</Table>



10/12/00                               3
<PAGE>

                                   STATE STREET                       SCHEDULE B
                             GLOBAL CUSTODY NETWORK
                    DEPOSITORIES OPERATING IN NETWORK MARKETS


<Table>
<Caption>
         COUNTRY                                              DEPOSITORIES
<S>                                                          <C>

         Lebanon                                              Custodian and Clearing Center of
                                                              Financial Instruments for Lebanon
                                                              and the Middle East (Midclear) S.A.L.
                                                              Banque du Liban


         Lithuania                                            Central Securities Depository of Lithuania


         Malaysia                                             Malaysian Central Depository Sdn. Bhd.

                                                              Bank Negara Malaysia,
                                                              Scripless Securities Trading and Safekeeping
                                                              System


         Mauritius                                            Central Depository and Settlement Co. Ltd.

                                                              Bank of Mauritius


         Mexico                                               S.D. INDEVAL
                                                              (Instituto para el Deposito de Valores)


         Morocco                                              Maroclear


         Netherlands                                          Nederlands Centraal Instituut voor
                                                              Giraal Effectenverkeer B.V. (NECIGEF)


         New Zealand                                          New Zealand Central Securities
                                                              Depository Limited


         Nigeria                                              Central Securities Clearing System Limited


         Norway                                               Verdipapirsentralen (Norwegian Central
                                                              Securities Depository)


         Oman                                                 Muscat Depository & Securities
                                                              Registration Company, SAOC
</Table>



10/12/00                               4
<PAGE>

                                   STATE STREET                       SCHEDULE B
                             GLOBAL CUSTODY NETWORK
                    DEPOSITORIES OPERATING IN NETWORK MARKETS


<Table>
<Caption>
         COUNTRY                                              DEPOSITORIES
<S>                                                          <C>

         Pakistan                                             Central Depository Company of Pakistan Limited

                                                              State Bank of Pakistan


         Palestine                                            Clearing Depository and Settlement, a department
                                                              of the Palestine Stock Exchange


         Peru                                                 Caja de Valores y Liquidaciones, Institucion de
                                                              Compensacion y Liquidacion de Valores S.A


         Philippines                                          Philippine Central Depository, Inc.

                                                              Registry of Scripless Securities
                                                              (ROSS) of the Bureau of Treasury


         Poland                                               National Depository of Securities
                                                              (Krajowy Depozyt Papierow Wartos<180>ciowych SA)

                                                              Central Treasury Bills Registrar


         Portugal                                             Central de Valores Mobiliarios


         Qatar                                                Central Clearing and Registration (CCR), a
                                                              department of the Doha Securities Market


         Romania                                              National Securities Clearing, Settlement and
                                                              Depository Company

                                                              Bucharest Stock Exchange Registry Division

                                                              National Bank of Romania


         Singapore                                            Central Depository (Pte) Limited

                                                              Monetary Authority of Singapore
</Table>



10/12/00                               5
<PAGE>

                                   STATE STREET                       SCHEDULE B
                             GLOBAL CUSTODY NETWORK
                    DEPOSITORIES OPERATING IN NETWORK MARKETS


<Table>
<Caption>
         COUNTRY                                              DEPOSITORIES
<S>                                                          <C>

         Slovak Republic                                      Stredisko cennych papierov

                                                              National Bank of Slovakia


         Slovenia                                             Klirinsko Depotna Druzba d.d.


         South Africa                                         Central Depository Limited

                                                              Share Transactions Totally Electronic
                                                              (STRATE) Ltd.


         Spain                                                Servicio de Compensacion y
                                                              Liquidacion de Valores, S.A.

                                                              Banco de Espana, Central de Anotaciones en Cuenta


         Sri Lanka                                            Central Depository System (Pvt) Limited


         Sweden                                               Vardepapperscentralen  VPC AB
                                                              (Swedish Central Securities Depository)


         Switzerland                                          SegaIntersettle AG (SIS)


         Taiwan - R.O.C.                                      Taiwan Securities Central Depository Co., Ltd.


         Thailand                                             Thailand Securities Depository Company Limited


         Tunisia                                              Societe Tunisienne Interprofessionelle pour la
                                                              Compensation et de Depots des Valeurs Mobilieres


         Turkey                                               Takas ve Saklama Bankasi A.S. (TAKASBANK)

                                                              Central Bank of Turkey
</Table>



10/12/00                               6
<PAGE>

                                   STATE STREET                       SCHEDULE B
                             GLOBAL CUSTODY NETWORK
                    DEPOSITORIES OPERATING IN NETWORK MARKETS


<Table>
<Caption>
         COUNTRY                                              DEPOSITORIES
<S>                                                          <C>

         Ukraine                                              National Bank of Ukraine

         United Kingdom                                       Central Gilts Office and
                                                              Central Moneymarkets Office


         Venezuela                                            Banco Central de Venezuela


         Zambia                                               LuSE Central Shares Depository Limited

                                                              Bank of Zambia
</Table>


TRANSNATIONAL

         Euroclear

         Clearstream Banking AG




10/12/00                               7
<PAGE>

                                   SCHEDULE C

                               MARKET INFORMATION

<Table>
<Caption>
PUBLICATION/TYPE OF INFORMATION                           BRIEF DESCRIPTION
- -------------------------------                           -----------------
(FREQUENCY)


<S>                                         <C>
The Guide to Custody in World Markets       An overview of safekeeping and settlement practices and procedures
(annually)                                  in each market in which State Street Bank and Trust Company offers
                                            custodial services.

Global Custody Network Review               Information relating to the operating history and structure of
(annually)                                  depositories and subcustodians located in the markets in which State
                                            Street Bank and Trust Company offers custodial services, including
                                            transnational depositories.

Global Legal Survey                         With respect to each market in which State Street Bank and Trust
(annually)                                  Company offers custodial services, opinions relating to whether
                                            local law restricts (i) access of a fund's independent public
                                            accountants to books and records of a Foreign Sub-Custodian or
                                            Foreign Securities System, (ii) the Fund's ability to recover in the
                                            event of bankruptcy or insolvency of a Foreign Sub-Custodian or
                                            Foreign Securities System, (iii) the Fund's ability to recover in
                                            the event of a loss by a Foreign Sub-Custodian or Foreign Securities
                                            System, and (iv) the ability of a foreign investor to convert cash
                                            and cash equivalents to U.S. dollars.

Subcustodian Agreements                     Copies of the subcustodian contracts State Street Bank and Trust
(annually)                                  Company has entered into with each subcustodian in the markets in
                                            which State Street Bank and Trust Company offers subcustody services
                                            to its US mutual fund clients.

Network Bulletins (weekly):                 Developments of interest to investors in the markets in which State
                                            Street Bank and Trust Company offers custodial services.

Foreign Custody Advisories (as
necessary):                                 With respect to markets in which State Street Bank and Trust Company
                                            offers custodial services which exhibit special custody risks,
                                            developments which may impact State Street's ability to deliver
                                            expected levels of service.
</Table>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(11)
<SEQUENCE>12
<FILENAME>c93084a1exv99wx11y.txt
<DESCRIPTION>OPINION AND CONSENT OF SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
<TEXT>
<PAGE>
                                                                   EXHIBIT 11

            [LETTERHEAD OF SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP]


                                  May 5, 2005



Van Kampen Municipal Trust
1221 Avenue of the Americas
New York, New York  10020

         Re:      Van Kampen Municipal Trust
                  Registration Statement on Form N-14


Ladies and Gentlemen:

         We have acted as special counsel to Van Kampen Municipal Trust, a
voluntary association with transferable shares organized and existing under and
by virtue of the laws of The Commonwealth of Massachusetts (commonly referred to
as a "Massachusetts business trust") (the "Fund"), in connection with the
preparation of the Fund's Registration Statement on Form N-14 (the "Registration
Statement") filed under the Securities Act of 1933, as amended (the "1933 Act"),
with the Securities and Exchange Commission (the "Commission"). The Registration
Statement relates to the registration under the 1933 Act of common shares of
beneficial interest of the Fund, par value $0.01 per share (the "Common
Shares"), and auction preferred shares of the Fund, par value $0.01 per share,
liquidation preference $25,000 per share (the "Preferred Shares"), to be issued
pursuant to an Agreement and Plan of Reorganization (the "Agreement and Plan of
Reorganization") between the Fund, and Van Kampen Investment Grade Municipal
Trust, a Massachusetts business trust (collectively, the "Shares").

         This opinion is delivered in accordance with the requirements of Item
16 of Form N-14 under the 1933 Act.

         In connection with this opinion, we have examined the originals or
copies, certified or otherwise identified to our satisfaction, of (i)
Registration Statement, as filed with the Commission on March 18, 2005 and as it
is proposed to be amended by Pre-Effective Amendment No. 1 to be filed on or
about May 5, 2005, under the 1933 Act, (ii) the Declaration of Trust (the
"Declaration of Trust"), By-Laws and Certificate of Vote of Trustees
Establishing Preferred Shares of the Fund, each as amended to date, (iii) a
specimen certificate representing the Common Shares, (iv) a specimen certificate
representing the Preferred Shares, (v) the resolutions adopted by the Board of
Trustees of the Fund relating to the Agreement and Plan of Reorganization, the
authorization and issuance of the Shares pursuant to the Agreement and Plan of
Reorganization, the filing of the Registration Statement and any amendments or
supplements thereto and related matters, (vi) a draft of the Agreement and Plan
of Reorganization and (vii) such other

<PAGE>


documents as we have deemed necessary or appropriate as a basis for the opinions
set forth herein.

         In such examination we have assumed the legal capacity of natural
persons, the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified, conformed, photostatic, or other copies
and the authenticity of the originals of such latter documents. As to any facts
material to such opinion which were not independently established, we have
relied on statements or representations of officers and other representatives of
the Fund or others.

         Based upon and subject to the foregoing, we are of the opinion that
when (i) the Registration Statement shall have become effective and (ii) the
issuance of Shares by the Fund pursuant to the Agreement and Plan of
Reorganization has been validly authorized and, assuming certificates therefor
have been duly executed, countersigned, registered and delivered, or the
shareholders' accounts have been duly credited, and the Shares represented
thereby have been fully paid for, such Shares will be validly issued, fully paid
and, subject to the statements set forth below regarding the liability of a
shareholder of a Massachusetts business trust, nonassessable.

         Pursuant to certain decisions of the Supreme Judicial Court of The
Commonwealth of Massachusetts, shareholders of a Massachusetts business trust
may, in certain circumstances, be assessed or held personally liable as partners
for the obligations of a Massachusetts business trust. Even if the Fund were
held to be a partnership, however, the possibility of the holders of Shares
incurring personal liability for financial losses of the Fund appears remote
because (A) Article V, Section 5.1 of the Declaration of Trust contains an
express disclaimer of liability for holders of shares of beneficial interest of
the Fund, including the Shares, for the obligations of the Fund and provides
that the Fund shall hold each holder of such shares harmless from, and shall
indemnify such holder against, all loss and expense arising solely from being or
having been a holder of such shares and (B) Article V, Section 5.5 of the
Declaration of Trust requires that a recitation of such disclaimer be included
in every written obligation, contract, instrument, certificate, share, other
security of the Fund or undertaking made or issued by the trustees of the Fund.

         We hereby consent to the filing of this opinion with the Commission as
Exhibit 11 to the Registration Statement. We also consent to the reference to
our firm under the heading "Legal Matters" in the Registration Statement. In
giving this consent, we do not hereby admit that we are in the category of
persons whose consent is required under Section 7 of the 1933 Act or the rules
and regulations of the Commission.

                                  Very truly yours,

                                  /s/ Skadden, Arps, Slate, Meagher & Flom LLP



                                       2
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(13)(A)
<SEQUENCE>13
<FILENAME>c93084a1exv99wx13yxay.txt
<DESCRIPTION>TRANSFER AGENCY AND SERVICE AGREEMENT
<TEXT>
<PAGE>
                                                                   EXHIBIT 13(a)

                      Transfer Agency and Service Agreement

                                     Between

                       Certain Van Kampen Closed-End Funds

                                       and

                           EquiServe Trust Company .A.

                                       and

                                 EquiServe Inc.

<PAGE>

Table of Contents

<TABLE>
<S>                                                                                               <C>
Section 1.   Certain Definitions............................................................       4

Section 2.   Appointment of Agent...........................................................       5

Section 3.   Standard Services..............................................................       6

Section 4.   Dividend Disbursing Services...................................................       7

Section 5.   Optional Services and Standards................................................       8

Section 6.   Fees and Expenses..............................................................       8

Section 7.   Representations and Warranties of Transfer Agent...............................

Section 8.   Representations and Warranties of Customers....................................

Section 9.   Indemnification/Limitation of Liability........................................      11

Section 10.  Damages........................................................................      13

Section 11.  Standard Care..................................................................      13

Section 12.  Responsibilities of the Transfer Agent.........................................      13

Section 13.  Covenants of the Customers and Transfer Agent..................................      15

Section 14.  Data Access and Propreitary Information........................................

Section 15.  Confidentiality................................................................      16

Section 16.  Term and Termination                                                                 17

Section  7.  Assignment.....................................................................      18

Section 18.  Unaffiliated Third Parties.....................................................      19
</TABLE>

<PAGE>

<TABLE>
<S>                                                                                               <C>
Section 19.     Miscellaneous.

Section 19.1    Notice

Section 19.2    Successors.....................................................................   20

Section 19.3    Amendments.....................................................................   20

Section 19.4    Severability...................................................................   20

Section 19.5    Governing Law..................................................................   20

Section 19.6    Force Majeure..................................................................   20

Section 19.7    Descriptive Headings...........................................................   20

Section 19.8    Third Party Beneficiaries

Section 19.9    Survival

Section 19.10   Priorities.....................................................................   21

Section 19.11   Merger of Agreement.

Section 19.12   Counterparts...................................................................   21
</TABLE>

                                       3
<PAGE>

      AGREEMENT made as of the 1st day of January, 2002, by and among Certain
Van Kampen Closed-End Funds as set forth in Appendix A, having their principal
office and place of business at One Parkview Plaza, Oakbrook Terrace, Illinois
60181 (collectively, the "Customers," or individually, the "Customer"), and
EquiServe Trust Company, N .A. and EquiServe Limited Partnership (collectively,
the "Transfer Agent").

      NOW THEREFORE, in consideration of the mutual covenants herein contained,
the parties hereto agree as follows:

1.    CERTAIN DEFINITIONS.

      (a) "Account" or "Accounts" shall mean the account of each Shareholder
             which account shall hold any full or fractional shares of Stock
             held by such Shareholder and/or outstanding funds or tax reporting
             to be done.

      (b) "Additional Services" shall mean any and all services which are not
             Services as set forth in the Fee and Service Schedule, but
             performed by Transfer Agent upon request of Customers.

      (c) "Agreement" shall mean this agreement and any and all exhibits or
             schedules attached hereto and any and all amendments or
             modifications, which may from time to time be executed.

      (d) "Annual Period" shall mean each twelve (12) month period commencing on
             the Effective Date and, thereafter, on each anniversary of the
             Effective Date.

      (e) "Closed Account" shall mean an account with a zero share balance, no
             outstanding funds or no reportable tax information.

      (f) "Dividend Reinvestment Plan" and "Direct Stock Purchase Plan shall
             mean the services as set forth in Section 4 and in the Fee and
             Service Schedule.

      (g) "Effective Date" shall mean the date first stated above.

      (h) "Enrollment Materials" shall mean the Plan brochure, enrollment card
             and other materials prepared by Transfer Agent for distribution to
             Participants.

      (i) "Fee and Service Schedule" shall mean the fees and services set forth
             in the "Fee and Service Schedule" attached hereto.

      (j) "Optional Services" shall mean all services described in Section 5.

      (k) "Services" shall mean any and all services as further described herein
             and in the "Fee and Service Schedule" or other schedules attached
             hereto.

4

<PAGE>

      (l) "Shares" shall mean common stock of the Customer authorized by the
             Customer's Declaration of Trust.

2.    APPOINTMENT OF AGENT

      2.1 The Customers hereby appoints the Transfer Agent to act as sole
transfer agent and registrar for all Shares in accordance with the terms and
conditions hereof, and the Transfer Agent accepts said appointment.

      2.2 In connection with the appointing of Transfer Agent as the transfer
agent and registrar for the Customers, the Customers has previously filed the
following documents with the Transfer Agent:

                        Copies of Registration Statements and amendments
                    thereto, filed with the Securities and Exchange Commission
                    for initial public offerings;

                        Specimens of all forms of outstanding stock
                    certificates, in forms approved by the Boards of Trustees of
                    the Customers, with a certificate of the Secretary of each
                    Customer as to such approval;

                        Specimens of the Signatures of the officers of the
                    Customers authorized to sign stock certificates and
                    individuals authorized to sign written instructions and
                    requests; and

            (d)   An opinion of counsel for each Customer with respect to:

                     (i)   Each Customer's organization and existence under the
                           laws of its state of organization.

                     (ii)  The status of all Shares of stock of each Customer
                           covered by the appointment under the Securities Act
                           of 1933, as amended, and any other applicable federal
                           or state statute; and

                     (iii) That all issued Shares are, and all unissued shares
                           will be, when issued, validly issued, fully paid and
                           non-assessable.

      2.3 Transfer Agent may adopt as part of its records all lists of holders,
records of each Customer's stock, books, documents and records which have been
employed by any former agent of the Customer for the maintenance of the ledgers
for such shares, provided such ledger is certified by an officer of Customer or
the prior transfer agent to be true, authentic and complete.

      2.4 Customers shall, if applicable, inform Transfer Agent as to (i) the
existence or termination of any restrictions on the transfer of Shares and in
the application to or removal from any certificate of stock of any legend
restricting the transfer of such Shares

5

<PAGE>

or the substitution for such certificate of a certificate without such legend,
(ii) any authorized but unissued Shares reserved for specific purposes, (iii)
any outstanding shares which are exchangeable for Shares and the basis for
exchange, (iv) reserved Shares subject to option and the details of such
reservation and (v) special instructions regarding dividends and information of
foreign holders.

      2.5 Transfer Agent represents that it is engaged in an independent
business and will perform its obligations under this Agreement as an agent of
Customers.

      2.6 Customers shall deliver to Transfer Agent an appropriate supply of
stock certificates, which certificates shall provide a signature panel for use
by an officer of or authorized signor for Transfer Agent to sign as transfer
agent and registrar, and which shall state that such certificates are only valid
after being countersigned and registered.

3.    STANDARD SERVICES.

      3.1   The Transfer Agent will perform the following services:

      In accordance with the procedures established form time to time by
agreement between the Customers and the Transfer Agent, the Transfer Agent
shall:

   (a) issue and record the appropriate number of Shares as authorized and hold
       such shares in the appropriate shareholder ("Shareholder") account;

   (b) effect transfers of Shares by the registered owners thereof upon receipt
       of appropriate documentation;

   (c) prepare and transmit payments for dividends and distributions declared by
       the respective Customer, provided good funds for said dividends or
       distributions are received by the Transfer Agent prior to or on the
       scheduled mailing date for said dividends or distributions;

   (d) act as agent for Shareholders pursuant to the dividend reinvestment plan,
       and other investment programs as amended from time to time in accordance
       with the terms of the agreements relating thereto to which the Transfer
       Agent is or will be a party; and

   (e) issue replacement certificates for those certificates alleged to have
       been lost, stolen or destroyed upon receipt by the Transfer Agent of an
       open penalty surety bond satisfactory to it and holding it, the Customers
       harmless, absent notice to the Customers and the Transfer Agent that such
       certificates have been acquired by a bona fide purchaser. The Transfer
       Agent, at its option, may issue replacement certificates in place of
       mutilated stock certificates upon presentation thereof without such
       indemnity. Further, the Transfer Agent may at its sole option accept
       indemnification from a Customers to issue replacement certificates for
       those

6

<PAGE>
       certificates alleged to have been lost, stolen or destroyed in lieu of an
       open penalty bond.

   (f) issue replacement checks and place stop on original checks based on
       shareholder's representation that a check was not received or was lost.
       Such stops and replacement will be deemed to have been made at the
       request of Customers and Customers shall be responsible for all losses
       or claims resulting from such replacement.

      3.2 Customary Services. The Transfer Agent shall perform all the customary
services of a transfer agent, dividend disbursing agent, agent of dividend
reinvestment plan, cash purchase plan and other investment programs as described
in Section 3.1 consistent with those requirements in effect as of the date of
this Agreement and in compliance with applicable laws as set forth in Section
3.3; provided, however, the Transfer Agent shall not be required to take
shareholder telephone calls or respond to written shareholder inquiries. All
such shareholder inquiries in writing or by telephone shall be handled by
Customers. Any correspondence or telephone inquiries from shareholders received
by the Transfer Agent will be forwarded to Customers. The detailed services and
definition, frequency, limitations and associated costs (if any) are set out in
the attached fee and service schedule ("Fee and Service Schedule").

      3.3 Compliance with Laws. The Customers agrees the Transfer Agent is
obligated to comply with all applicable federal, state and local laws and
regulations, codes, order and government rules in the performance of its duties
hereunder this Agreement.

      3.4 Unclaimed Property and Lost Shareholders. The Transfer Agent shall
report unclaimed property to each state in compliance with state law and Section
17Ad-17 of the Exchange Act of 1934 as amended (the "Exchange Act") for lost
shareholders. If the Customers are not in compliance with applicable state laws,
there will be no charge for the first two years for this service; provided that
after the first two years, the Transfer Agent will charge Customers its then
standard fee plus any out-of-pocket expenses.

      3.5 Compliance with Office of Foreign Asset Control ("OFAC") Regulation.
Ensure compliance with OFAC laws.

4.    DIVIDEND DISBURSING SERVICES.

      4.1 Upon receipt of a written notice from the President, any Vice
President, Assistant Secretary, Treasurer or Assistant Treasurer of a Customer
declaring the payment of a dividend, Transfer Agent shall disburse such dividend
payments provided that on or before the mail date for such payment, Customers
furnishes Transfer Agent with sufficient funds. The payment of such funds to
Transfer Agent for the purpose of being available for the payment of dividend
checks from time to time is not intended by Customers to confer any rights in
such funds on Customer shareholders whether in trust or in contract or
otherwise.

7

<PAGE>

      4.2 Customers hereby authorizes Transfer Agent to stop payment of checks
issued in payment of dividends, but not presented for payment, when the payees
thereof allege either that they have not received the checks or that such checks
have been mislaid, lost, stolen, destroyed or, through no fault of theirs, are
otherwise beyond their control and cannot be produced by them for presentation
and collection, and Transfer Agent shall issue and deliver duplicate checks in
replacement thereof, and Customers shall indemnify Transfer Agent against any
loss or damage resulting from reissuance of the checks.

      4.3 Transfer Agent is hereby authorized to deduct from all dividends
declared by Customers and disbursed by Transfer Agent, as dividend disbursing
agent, the tax required to be withheld pursuant to Sections 1441, 1442 and 3406
of the Internal Revenue Code of 1986, as amended, or by any Federal or State
statutes subsequently enacted, and to make the necessary return and payment of
such tax in connection therewith.

5.    OPTIONAL SERVICES AND STANDARDS.

            5               Optional Services

                            To the extent that a Customer elects to engage the
                        Transfer Agent to provide the services listed below the
                        Customers shall engage the Transfer Agent to provide
                        such services upon terms and fees to be agreed upon by
                        the parties:

                  a.        Employee Plan Services;

                  b.        Employee Share Purchase Programs;

                  c.        Corporate Actions (including inter alia, odd lot buy
                        backs, exchanges, mergers, redemptions, subscriptions,
                        capital reorganization, coordination of post-merger
                        services and special meetings); and

                  d.        Shareholder written and telephone inquiry
                            services.

6.    FEES AND EXPENSES.

      6.1 Fee and Service Schedules. Customers agrees to pay Transfers Agent
fees for services performed pursuant to this Agreement as set forth in the Fee
and Service Schedule attached hereto, for the Initial Term of the Agreement.

      6.2 COLA. After the Initial Term of the Agreement, providing that service
mix and volumes remain constant, the fees listed in the Fee and Service Schedule
shall be increased by the accumulated change in the National Employment Cost
Index for Service Producing Industries (Finance, Insurance, Real Estate) for the
preceding years of the contract, as published by the Bureau of Labor Statistics
of the United States Department of Labor. Fees will be increased on this basis
on each successive contract anniversary thereafter.

8

<PAGE>

      6.3 Adjustments. Notwithstanding Section 6.1 above, fees, and the
out-of-pocket expenses and advances identified under Section 6.4 below, may be
changed from time to time as agreed upon in writing between the Transfer Agent
and the Customers.

      6.4 Out-of-Pocket Expenses. In addition to the fees paid under Section 6.1
above, the Customer agrees to reimburse the Transfer Agent for out-of-pocket
expenses, including but not limited to postage, forms, telephone, microfilm,
microfiche, taxes, records storage, exchange and broker fees, or advances
incurred by the Transfer Agent for the items set out in Exhibit A attached
hereto. Out-of-pocket expenses may include the costs to Transfer Agent of
administrative expenses. In addition, any other expenses incurred by the
Transfer Agent at the request or with the consent of the Customers, will be
reimbursed by the applicable Customer.

      6.5 Conversion Funds. Conversion funding required by any out of proof
condition caused by a prior agents' services shall be advanced to Transfer Agent
prior to the commencement of services.

      6.6 Postage. Postage for mailing of dividends, proxies, Customers reports
and other mailings to all shareholder accounts shall be advanced to the Transfer
Agent by the Customers prior to commencement of the mailing date of such
materials.

      6.7 Invoices. The Customers agrees to pay all fees and reimbursable
expenses upon receipt of the respective billing notice, except for any fees or
expenses that are subject to good faith dispute. In the event of such a dispute,
the Customers may only withhold that portion of the fee or expense subject to
the good faith dispute. The Customers shall notify the Transfer Agent in writing
within twenty-one (21) calendar days following the receipt of each billing
notice if the Customer disputing any amounts in good faith. If the Customer does
not provide such notice of dispute within the required time, the billing notice
will be deemed accepted by the Customer. The Customer shall settle such disputed
amounts within five (5) days of the day on which the parties agree on the amount
to be paid by payment of the agreed amount. If no agreement is reached, then
such disputed amounts shall be settled as may be required by law or legal
process.

      6.8 Taxes. Customers shall pay all sales or use taxes in lieu thereof with
respect to the Services (if applicable) provided by Transfer Agent under this
Agreement.

      6.9 Late Payments.

      (a) If any undisputed amount in an invoice of the Transfer Agent (for fees
or reimbursable expenses) is not paid when due, the Customers shall pay the
Transfer Agent interest thereon (from the due date to the date of payment) at a
per annum rate equal to one percent (1.0%) plus the Prime Rate (that is, the
base rate on corporate loans posted by large domestic Transfer Agents) published
by The Wall Street Journal (or, in the event such rate is not so published, a
reasonably equivalent published rate selected by Customers on the first day of
publication during the month when such amount was due.

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Notwithstanding any other provision hereof, such interest rate shall be no
greater than permitted under applicable provisions of Massachusetts or New
Jersey law.

      (b) The failure by Customers to pay an invoice within 90 days after
receipt of such invoice or the failure by the Customers to timely pay two
consecutive invoices shall constitute a material breach pursuant to Section
16.2(a)(i) below. The Transfer Agent may terminate this Agreement for such
material breach immediately and shall not be obligated to provide the Customers
with 30 days to cure such breach.

      6.10 Services Required by Legislation. Services required by legislation or
regulatory mandate that become effective after the effective date of this
Agreement shall not be part of the standard services, and shall be billed by
appraisal.

      6.11 Overtime Charges. Overtime charges will be assessed in the event of a
late delivery to the Transfer Agent of Customers material for mailings to
shareholders, unless the mail date is rescheduled. Such material includes, but
is not limited to, proxy statements, quarterly and annual reports, dividend
enclosures and news releases.

                REPRESENTATIONS AND WARRANTIES OF TRANSFER AGENT.

      The Transfer Agent represents and warrants to the Customers that:

      7.1 EquiServe Trust Company, N.A. is a federally chartered limited purpose
national bank duly organized under the laws of the United States and EquiServe
Limited Partnership is a limited partnership validly existing and in good
standing under the laws of the State of Delaware;

      7.2 It is duly qualified to carry on its business in The Commonwealth of
Massachusetts;

      7.3 It is empowered under applicable laws and by its Charter and/or
By-Laws to enter into and perform this Agreement;

      7.4 All requisite corporate proceedings have been taken to authorize it to
enter into and perform this Agreement; and

      7.5 It has and will continue to have access to the necessary facilities,
equipment and personnel to perform its duties and obligations under this
Agreement.

      7.6 It will comply with all applicable sections of the Securities Exchange
Act of 1934 necessary to enter into and perform this Agreement.

      7.7 It has and will continue to have a disaster recovery plan which may be
reviewed by Customers upon request.

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8.    REPRESENTATIONS AND WARRANTIES OF CUSTOMERS.

      The Customers represents and warrants to the Transfer Agent that:

      8.1 Customers are duly organized, existing and in good standing under the
laws of Massachusetts;

      8.2 It is empowered under applicable laws and by its Declaration of Trust
and By-Laws to enter into and perform this Agreement;

      8.3 All corporate proceedings required by said Declaration of Trust, and
By-Laws and applicable law have been taken to authorize it to enter into and
perform this Agreement; and

      8.4 A registration statement under the Securities Act of 1933, as amended
(the "1933 Act") was filed prior to the initial offering of any Shares, and all
appropriate state securities law filings were made within respect to all Shares
of the Customers; information to the contrary will result in immediate
notification to the Transfer Agent.

9.    INDEMNIFICATION.

      9.1 The Transfer Agent shall not be responsible for, and the applicable
Customer shall indemnify and hold the Transfer Agent harmless from and against,
any and all losses, claims, damages, costs, charges, counsel fees and expenses,
payments, expenses and liability arising out of or attributable to:

            (a) All actions of the Transfer Agent or its agents or
      subcontractors required to be taken pursuant to this Agreement, provided
      such actions are taken in good faith and without negligence or willful
      misconduct;

            (b) The Customer's lack of good faith, negligence or willful
      misconduct or the breach of any representation or warranty of the
      Customers hereunder;

            (c) The reliance or use by the Transfer Agent or its agents or
      subcontractors of information, records and documents which (i) are
      received by the Transfer Agent or its agents or subcontractors and
      furnished to it by or on behalf of the Customer, and (ii) have been
      prepared and/or maintained by the Customer or any other person or firm on
      behalf of the Customer. Such other person or firm shall include any former
      transfer agent or former registrar, or co-transfer agent or co-registrar
      or any current registrar where the Transfer Agent is not the current
      registrar;

            (d) The reliance or use by the Transfer Agent or its agents or
      subcontractors of any paper or document reasonably believed to be genuine
      and to have been signed by the proper person or persons including
      Shareholders;

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            (e) The reliance on, or the carrying out by the Transfer Agent or
      its agents or subcontractors of any instructions or requests of the
      Customer's or Customer's representatives;

            (f) The offer or sale of Shares in violation of any federal or state
      securities laws requiring that such shares be registered or in violation
      of any stop order or other determination or ruling by any federal or state
      agency with respect to the offer or sale of such Shares;

            (g) The negotiations and processing of checks, including checks made
      payable to prospective or existing shareholders which are tendered to the
      Transfer Agent for the purchase of shares (commonly known as "third party
      checks");

            (h) Any actions taken or omitted to be taken by any former agent of
      Customer and arising from Transfer Agent's reliance on the certified list
      of holders; and

            (i) The negotiation, presentment, delivery or transfer of shares
      through the Direct Registration System Profile System.

      9.2 At any time the Transfer Agent may apply to any officer of the
applicable Customer for instruction, and may consult with legal counsel with
respect to any matter arising in connection with the services to be performed by
the Transfer Agent under this Agreement, and Transfer Agent and its agents and
subcontractors shall not be liable and shall be indemnified by such Customer for
any action taken or omitted by it in reliance upon such instructions or upon the
advice or opinion of such counsel. The Transfer Agent, its agents and
subcontractors shall be protected and indemnified in acting upon any paper or
document reasonably believed to be genuine and to have been signed by the proper
person or persons, or upon any instruction, information, data, records or
documents provided the Transfer Agent or its agents or subcontractors by
telephone, in person, machine readable input, telex, CRT data entry or similar
means authorized by such Customer, and shall not be held to have notice of any
change of authority of any person, until receipt of written notice thereof from
the Customer. The Transfer Agent, its agents and subcontractors shall also be
protected and indemnified in recognizing stock certificates which are reasonably
believed to bear the proper manual or facsimile signatures of officers of the
Customer, and the proper countersignature of any former transfer agent or former
registrar, or of a co-transfer agent or co-registrar.

      9.3 In order that the indemnification provisions contained in this Section
shall apply, upon the assertion of a claim for which the Customer may be
required to indemnify the Transfer Agent, the Transfer Agent shall promptly
notify the Customer of such assertion, and shall keep the Customer advised with
respect to all developments concerning such claim. The Customer shall have the
option to participate with the Transfer Agent in the defense of such claim or to
defend against said claim in its own

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name or the name of the Transfer Agent. The Transfer Agent shall in no case
compromise any claim or make any compromise in any case in which the Customer
may be required to indemnify it except with the Customer's prior written
consent.

10.   DAMAGES.

      NEITHER PARTY SHALL BE LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL OR
CONSEQUENTIAL DAMAGES OF ANY NATURE WHATSOEVER, INCLUDING, BUT NOT LIMITED TO,
LOSS OF ANTICIPATED PROFITS, OCCASIONED BY A BREACH OF ANY PROVISION OF THIS
AGREEMENT EVEN IF APPRISED OF THE POSSIBILITY OF SUCH DAMAGES.

11.   STANDARD OF CARE.

      The Transfer Agent shall at all times act in good faith and agrees to use
its best efforts within reasonable time limits to insure the accuracy of all
services performed under this Agreement, but assumes no responsibility and shall
not be liable for loss or damage due to errors unless said errors are caused by
its negligence, bad faith or willful misconduct or that of its employees, agents
or subcontractors.

12.   RESPONSIBILITIES OF THE TRANSFER AGENT.

      The Transfer Agent undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions, by all of which the
Customers, by its acceptance hereof, shall be bound:

      12.1 Whenever in the performance of its duties hereunder the Transfer
Agent shall deem it necessary or desirable that any fact or matter be proved or
established prior to taking or suffering any action hereunder, such fact or
matter may be deemed to be conclusively proved and established by a certificate
signed by the Chairman of the Board, the President, any Vice President, the
Treasurer, any Assistant treasurer, the Secretary or any Assistant Secretary of
the applicable Customer and delivered to the Transfer Agent. Such certificate
shall be full authorization to the Transfer Agent for any action taken or
suffered in good faith by it under the provisions of this Agreement in reliance
upon such certificate.

      12.2 The Customers agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may reasonably be required
by the Transfer Agent for the carrying out, or performing by the Transfer Agent
of the provisions of this Agreement.

      12.3 Transfer Agent, any of its affiliates or subsidiaries, and any
stockholder, director, officer or employee of the Transfer Agent may buy, sell
or deal in the securities of the Customers or become pecuniary interested in any
transaction in which the Customers may be interested, or contract with or lend
money to the Customers or otherwise act as fully and freely as though it were
not appointed as agent under this

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Agreement. Nothing herein shall preclude the Transfer Agent from acting in any
other capacity for the Customers or for any other legal entity.

      12.4 No provision of this Agreement shall require the Transfer Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of its rights if
it shall believe in good faith that repayment of such funds or adequate
indemnification against such risk or liability is not reasonably assured to it.

13.   COVENANTS OF THE CUSTOMERS AND TRANSFER AGENT.

13.1  Customers Corporate Authority. The Customers have previously furnished or
      will furnish to the Transfer Agent the following:

            (a)   A copy of the Declaration of Trust and By-Laws of each
                  Customer;

            (b)   Copies of all material amendments to each Customer's
                  Declaration of Trust or By-Laws made after the date of this
                  Agreement, promptly after such amendments are made; and

            (c)   A certificate of each Customer as to the Shares authorized
                  issued and outstanding as well as a description of all
                  reserves of unissued shares relating to the exercise of
                  options warrants or a conversion of debentures or otherwise.

13.2  Transfer Agent Facilities. The Transfer Agent hereby agrees to establish
      and maintain facilities and procedures reasonably acceptable to the
      Customers for the safekeeping of stock certificates, check forms and
      facsimile signature imprinting devices, if any, and for the preparation,
      use, and recordkeeping of such certificates, forms and devices.

13.3  Records. The Transfer Agent shall keep records relating to the services to
      be performed hereunder, in the form and manner as it may deem advisable.
      The Transfer Agent agrees that all such records prepared or maintained by
      it relating to the services performed hereunder are the property of the
      Customers and will be preserved, maintained and made available in
      accordance with the requirements of law, and will be surrendered promptly
      to the Customers on and in accordance with its request.

13.4  Confidentiality. The Transfer Agent and the Customers agree that all
      books, records, information and data pertaining to the business of the
      other party which are exchanged or received pursuant to the negotiation or
      the carrying out of this Agreement shall remain confidential, and shall
      not be voluntarily disclosed to any other person, except as may be
      required by law. If disclosure is requested upon alleged authority of law,
      the party to whom disclosure is requested shall provide prompt notice of
      such request to the other party to enable such other party to seek
      appropriate protective order or other remedy. If, in the absence of a
      protective order or other remedy or waiver of the

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terms of this provision, the party to whom disclosure is requested determines in
good faith that it is required by law to disclose any books, records,
information or data pertaining to the business of the other party, it may do so
without any liability.

13.5  Non-Solicitation of Transfer Agent Employees. Customers shall not attempt
      to hire or assist with the hiring of an employee of EquiServe or
      affiliated companies or encourage any employee to terminate their
      relationship with EquiServe or its affiliated companies.

13.6  Notification. Customers shall notify Transfer Agent as soon as possible in
      advance of any stock split, stock dividend similar event which may affect
      the Stock, and any bankruptcy, insolvency, moratorium or other proceeding
      regarding Customers affecting the enforcement of creditors' rights.
      Notwithstanding any other provision of the Agreement to the contrary,
      Transfer Agent will have no obligation to perform any Services under the
      Agreement subsequent to the commencement of any bankruptcy, insolvency,
      moratorium or other proceeding regarding Customers affecting the
      enforcement of creditor' rights unless Transfer Agent receives assurance
      satisfactory to it that it will receive full payment for such services.
      Further, Customers may not assume the Agreement after the filing of a
      bankruptcy petition without Transfer Agent's written consent.

14.   DATA ACCESS AND PROPRIETARY INFORMATION.

14.1  The Customers acknowledge that the data bases, computer programs, screen
      formats, report formats, interactive design techniques, and documentation
      manuals furnished to the Customers by the Transfer Agent as part of the
      ability to access certain related data ("Customers Data") maintained by
      the Transfer Agent on data bases under the control and ownership of the
      Transfer Agent or other third party ("Data Access Services") constitute
      copyrighted, trade secret, or other proprietary information (collectively,
      "Proprietary Information") of substantial value to the Transfer Agent or
      other third party. In no event shall Proprietary Information be deemed
      Customers Data. The Customers agree to treat all Proprietary Information
      as proprietary to the Transfer Agent and further agree that it shall not
      divulge any Proprietary Information to any person or organization except
      as may be provided hereunder. Without limiting the foregoing, the
      Customers agree for themselves and its employees and agents:

            (a)   to access Customers Data solely from locations as may be
                  designated in writing by the Transfer Agent and solely in
                  accordance with the Transfer Agent's applicable user
                  documentation;

            (b)   to refrain from copying or duplicating in any way the
                  Proprietary Information;

            (c)   to refrain from obtaining unauthorized access to any portion
                  of the

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      Proprietary Information, and if such access is inadvertently obtained, to
      inform the Transfer Agent in a timely manner of such fact and dispose of
      such information in accordance with the Transfer Agent's instructions;

            (d)   to refrain from causing or allowing the data acquired
                  hereunder from being retransmitted to any other computer
                  facility or other location, except with the prior written
                  consent of the Transfer Agent;

            (e)   that the Customers shall have access only to those authorized
                  transactions agreed upon by the parties; and

            (f)   to honor all reasonable written requests made by the Transfer
                  Agent to protect at the Transfer Agent's expense the rights of
                  the Transfer Agent in Proprietary Information at common law,
                  under federal copyright law and under other federal or state
                  law.

      Each party shall take reasonable efforts to advise its employees of their
obligations pursuant to this Section 14.

14.2  If any Customer notifies the Transfer Agent that any of the Data Access
      Services do not operate in material compliance with the most recently
      issued user documentation for such services, the Transfer Agent shall
      endeavor in a timely manner to correct such failure. Organizations from
      which the Transfer Agent may obtain certain data included in the Data
      Access Services are solely responsible for the contents of such data and
      the Customers agrees to make no claim against the Transfer Agent arising
      out of the contents of such third party data, including, but not limited
      to, the accuracy thereof. DATA, ACCESS SERVICES AND ALL COMPUTER PROGRAMS
      AND SOFTWARE SPECIFICATIONS USED IN CONNECTION THEREWITH ARE PROVIDED ON
      AN AS IS, AS AVAILABLE BASIS. THE TRANSFER AGENT EXPRESSLY DISCLAIMS ALL
      WARRANTIES EXCEPT THOSE EXPRESSLY STATED HEREIN INCLUDING, BUT NOT LIMITED
      TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR
      PURPOSE.

14.3  If the transactions available to the Customers include the ability to
      originate electronic instructions to the Transfer Agent in order to (i)
      effect the transfer or movement of cash or shares or (ii) transmit
      Shareholder information or other information, then in such event the
      Transfer Agent shall be entitled to rely on the validity and authenticity
      of such instructions without undertaking any further inquiry as long as
      such instructions are undertaken in conformity with security procedures
      established by the Transfer Agent from time to time.

15.   CONFIDENTIALITY.

15.1  The Transfer Agent and the Customers agree that they will not, at any time
      during the term of this Agreement or after its termination, reveal,
      divulge, or make known to any person, firm, corporation or other business
      organization, any Customers'

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lists, trade secrets, cost figures and projections, profit figures and
projections, or any other secret or confidential information whatsoever, whether
of the Transfer Agent, the Customers, used or gained by the Transfer Agent or
the Customers during performance under this Agreement. The Customers and the
Transfer Agent further covenant and agree to retain all such knowledge and
information acquired during and after the term of this Agreement respecting such
lists, trade secrets, or any secret or confidential information whatsoever in
trust for the sole benefit of the Transfer Agent or the Customers and their
successors and assigns. The above prohibition of disclosure shall not apply to
the extent that the Transfer Agent must disclose such data to its sub-contractor
or Customers agent for purposes of providing services under this Agreement.

15.2  In the event that any requests or demands are made for the inspection of
      the Shareholder records of the Customers, other than request for records
      of Shareholders pursuant to standard subpoenas from state or federal
      government authorities (e.g., in divorce and criminal actions), the
      Transfer Agent will endeavor to notify the Customers and to secure
      instructions from an authorized officer of the Customers as to such
      inspection. The Transfer Agent expressly reserves the right, however, to
      exhibit the Shareholder records to any person whenever it is advised by
      counsel that it may be held liable for the failure to exhibit the
      Shareholder records to such person or if required by law or court order.

15.3  PRIVACY ACT INFORMATION DEFINITION:

            (a) DEFINITION: Transfer Agent may receive information from Customer
or may come into possession of information that Customer is required to protect
under Title V of the Graham-Leach-Bliley Act of 1999 ("Privacy Act") in
connection with providing services to Customer under this Agreement. For
purposes of this Agreement, "Privacy Act Information" shall mean the following
types of information and other information of a similar nature (whether or not
reduced to writing): Shareholder information, non public personal information
including "personally identifiable financial information" whether provided
directly by the Shareholder in connection with obtaining a service or obtained
from other sources, Shareholder financial information, Shareholder names and
other information related to Shareholders.

            (b) OWNERSHIP: All notes, data, reference, materials, memoranda,
documentation and records, in any way incorporating or reflecting any of the
Privacy Act Information shall belong exclusively at all times to Customer and
Transfer Agent agrees to turn over all copies of such materials in Transfer
Agent's control or possession to Customer upon request or upon termination of
this Agreement, subject to applicable law.

            (c) CONFIDENTIALITY: Transfer Agent agrees during the term of this
Agreement and thereafter to hold in confidence and not to directly or indirectly
reveal, report, publish, disclose or transfer any of the Privacy Act Information
to any person or entity, or utilize any of the Privacy Act Information for any
purpose, except in connection with providing services hereunder or as required
by law; provided, however, Transfer Agent may disclose such Privacy Act
Information to its third-party vendors for purposes of

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performing services for Customer provides such third party vendors are
contractually bound to keep such information confidential.

16.   TERM AND TERMINATION.

16.1  Term. The initial term of this Agreement (the "Initial Term") shall be for
      the period January 1, 2002 until July 31, 2004, unless terminated pursuant
      to the provisions of this Section 16. Unless a terminating party gives
      written notice to the other party one hundred twenty (120) days before the
      expiration of the Initial Term this Agreement will renew automatically
      from year to year ("Renewal Term"). If after the Initial Term, any party
      to this Agreement may terminate this Agreement by providing notice to the
      other parties one hundred twenty (120) days prior to the anticipated
      termination date. One hundred twenty (120) days before the expiration of
      the Initial Term or a Renewal Term the parties to this Agreement will
      agree upon a Fee Schedule for the upcoming Renewal Term.

16.2  Early Termination. Notwithstanding anything contained in this Agreement to
      the contrary, should a Customer desire to move any of the services
      provided by the Transfer Agent for the Customers hereunder to a successor
      service provider prior to the expiration of the then current Initial or
      Renewal Term, or without the required notice period, the Transfer Agent
      shall make a good faith effort to facilitate the conversion on such prior
      date, however, there can be no guarantee that the Transfer Agent will be
      able to facilitate a conversion of services on such prior date. In
      connection with the foregoing, should services be converted to a successor
      service provider, or if the Customer is liquidated or its assets merged or
      purchased or the like with another entity which does not utilize the
      services of the Transfer Agent, the fees payable to the Transfer Agent
      shall be calculated as if the services had remained with the Transfer
      Agent until the expiration of the then current Initial or Renewal Term and
      calculated at existing rates on the date notice of termination was given
      to the Transfer Agent, and the payment of fees to the Transfer Agent as
      set forth herein shall be accelerated to the date prior to the conversion
      or termination of services. Section 16.2 shall not apply if the Transfer
      Agent is terminated for cause under Section 16.4(a) of this Agreement.

16.3  Expiration of Term. After the expiration of the Initial Term or Renewal
      Term whichever currently in effect, should either party exercise its right
      to terminate, all reasonable out-of-pocket expenses or costs associated
      with the movement of records and material will be borne by the Customer.
      Additionally, the Transfer Agent reserves the right to charge for any
      other reasonable expenses associated with such termination and a
      de-conversion/transition fee in an amount equal to 10% of the aggregate
      fees incurred by Customer during the immediately preceding twelve (12)
      month period, provided, however, such fee shall in no event be less one
      thousand dollars.

16.4  Termination. This Agreement may be terminated in accordance with the
      following:

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                  (a)   at any time by the parties upon a material breach of the
                        representation and warranties of Section 7, or of a
                        covenant or term of this Agreement by the other which is
                        not cured within a period not to exceed thirty (30) days
                        after the date of written notice thereof by the other
                        party;

                  (b)   by Transfer Agent, at any time, in the event that during
                        the term if this Agreement, a bankruptcy or insolvency
                        proceeding is filed by or against a Customer or a
                        trustee or receiver is appointed for any substantial
                        part of Customer's property (and in a case of
                        involuntary bankruptcy, insolvency or receivership
                        proceeding, there is entered an order for relief, or
                        order appointing a receiver or some similar order or
                        decree and Customer does not succeed in having such
                        order lifted or stayed within sixty (60) days from the
                        date of its entry), or Customer makes an assignment of
                        all or substantially all of its property for the benefit
                        of creditors or ceases to conduct its operations in the
                        normal course or business.

      16.5 Records. Upon receipt of written notice of termination, the parties
will use commercially practicable efforts to effect an orderly termination of
this Agreement. Without limiting the foregoing, Transfer Agent will deliver
promptly to Customers, in machine readable form on media as reasonably requested
by Customers, all stockholder and other records, files and data supplied to or
compiled by Transfer Agent on behalf of Customers.

17.   ASSIGNMENT.

17.1  The Transfer Agent may, without further consent of the Customers assign
      its right and obligations hereunto to any affiliated and registered
      transfer agent under Section 17(A)(c)(2) of the Securities and Exchange
      Act. The Transfer Agent may not assign its rights or obligation without
      the written consent of the Customer.

17.2  The Transfer Agent may, without further consent on the part of Customers,
      subcontract with other subcontractors for telephone and mailing services
      as may be required from time to time; provided, however, that the Transfer
      Agent shall be as fully responsible to the Customers for the acts and
      omissions of any subcontractor as it is for its acts and omissions.

17.3  This Agreement shall inure to the benefit of and be binding upon the
      parties and their respective permitted successors and assigns.

18.   UNAFFILIATED THIRD PARTIES.

      Nothing herein shall impose any duty upon the Transfer Agent in connection
with or make the Transfer Agent liable for the actions or omissions to act of
unaffiliated third parties such as, by way of example and not limitation,
airborne services, the U.S. mails

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and telecommunication companies, provided, if the Transfer Agent selected such
company, the Transfer Agent shall have exercised due care in selecting the same.

19.   MISCELLANEOUS.

                    Notices.

      Any notice or communication by the Transfer Agent or the Customers to the
other is duly given if in writing and delivered in person or mailed by first
class mail, postage prepaid, telex, telecopier or overnight air courier
guaranteeing next day delivery, to the other's address:

                           If to the Customers:

                           Van Kampen Closed-End Funds
                           C/O Van Kampen Investments Inc.
                           One Parkview Plaza
                           Oakbrook Terrace, IL 60181
                           Telecopy No.: ( ) xxx-xxxx
                           Attn: General Counsel

                           If to the Transfer Agent:

                           EquiServe Trust Company, N.A.

                           c/o EquiServe Limited Partnership
                           150 Royall Street
                           Canton, MA 02021
                           Telecopy No.: (781) 575-4188
                           Attn: President

      The Transfer Agent and the Customers may, by notice to the other,
designate additional or different addresses for subsequent notices or
communications.

                    Successors.

      All the covenants and provisions of this agreement by or for the benefit
of the Customers or the Transfer Agent shall bind and inure to the benefit of
their respective successors and assigns hereunder.

                    Amendments.

      This Agreement may be amended or modified by a written amendment executed
by both parties hereto and authorized or approved by a resolution of the Board
of Directors of the Customers.

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                    Severability.

      If any term, provision, covenant or restriction of this Agreement is held
by a court of competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provision, covenants and restrictions
of this Agreement shall remain in full force and effect and shall in no way be
affected, impaired or invalidated.

                    Governing Law.

      This Agreement shall be governed by the laws of The Commonwealth of
Massachusetts.

                    Force Majeure.

      Notwithstanding anything to the contrary contained herein, Transfer Agent
shall not be liable for any delays or failures in performance resulting from
acts beyond its reasonable control including, without limitation, acts of God,
shortage of supply, breakdowns or malfunctions, interruptions or malfunction of
computer facilities, or loss of data due to power failures or mechanical
difficulties with information storage or retrieval systems, labor difficulties,
war, or civil unrest.

                    Descriptive Headings.

      Descriptive headings of the several sections of this Agreement are
inserted for convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.

                    Third Party Beneficiaries.

      The provisions of this Agreement are intended to benefit only the Transfer
Agent and their respective permitted successors and assigns. No rights shall be
granted to any other person by virtue of this agreement, and there are no third
party beneficiaries hereof.

                    Survival.

      All provisions regarding indemnification, warranty, liability and limits
thereon, and confidentiality and protection of proprietary rights and trade
secrets shall survive the termination of this Agreement.

   19.10 Priorities.

      In the event of any conflict, discrepancy, or ambiguity between the terms
and conditions contained in this Agreement and any schedules or attachments
hereto, the terms and conditions contained in this Agreement shall take
precedence.

21

<PAGE>

Kampen America Capital, Inc. dated November 12, 1997 and May 14, 1998 (attached
as Exhibit C), which shall be part of this Agreement for all Customers.

   19.12 Counterparts.

      This Agreement may be executed in any number of counterparts and each of
such counterparts shall for all purposes be deemed to be an original, and all
such counterparts shall together constitute but one and the same instrument.

      IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be executed by one of its officers thereunto duly authorized, all as of the
date first written above.

                                         CERTAIN VAN KAMPEN CLOSED END FUNDS

                                         By: /s/ John L Sullivan
                                             ---------------------------------
                                         Name: John L Sullivan
                                         Title: Treasurer

                                         EQUISERVE, INC.
                                         EQUISERVE TRUST COMPANY, N.A.

                                         ON BEHALF OF BOTH ENTITIES:

                                         By: /s/ Dennis V. Moccia
                                             ---------------------------------
                                         Name: Dennis V. Moccia
                                         Title: Managing Director

22

<PAGE>

                            FEE AND SERVICE SCHEDULE
                           FOR STOCK TRANSFER SERVICES

                                     BETWEEN

                       CERTAIN VAN KAMPEN CLOSED END FUNDS

                                       AND

                                 EQUISERVE, INC.

                                       AND

                         EQUISERVE TRUST COMP ANY, N.A.

      TERM

      This Fee and Service Schedule is by and between, EquiServe, Inc. and
EquiServe Trust Company" N.A. (collectively, the "Transfer Agent") and Certain
Van Kampen Closed End Funds (hereinafter referred to collectively as the
("Customers"), or individually as the Customer), whereby the Transfer Agent will
perform the following services for the Common Stock of each Customer.

      The term of this Fee and Service Schedule shall be for a period commencing
from January 1, 2002, the effective date of this Fee and Service Schedule, for a
period of two years and seven months, ending July 31, 2004.

      FEES AND SERVICES

Transfer Agent and Registrar Fee

            $ 750.00   Per Month Per Customer

            $   6.00   Per Open Registered Shareholder Account Per Annum

            $   0.00   Per Closed Shareholder Account Per Annum, up to 20,000
                       closed accounts per year. Closed accounts maintained in
                       excess of 20,000 will be billed at $5.00 per account
                       per annum.

            $  0.50    Per Participant Dividend Reinvestment or Cash Investment
                       Transaction

      Includes the standard Transfer Agent and Registrar services as stated in
the following sections:

                  Administrative Services

                  -     Annual administrative services as Transfer Agent and
                        Registrar for Customers Assignment of Account
                        Administrator and Administrative Support Coordinator

                  -     Remote inquiry access to shareholder records (technology
                        and access charges to be billed separately as
                        out-of-pocket pass-through expenses)

                                     Page 1
<PAGE>
      ACCOUNT MAINTENANCE

      -     Maintaining record shareholder accounts to include the
            following services:

            -     Processing of new shareholder accounts

            -     Posting address changes and other routine file
                  maintenance adjustments

            -     Posting all transactions, including debit and
                  credit certificates to the stockholder file

            -     Researching and responding to registered
                  shareholder inquiries (former American Capital
                  funds only)

            -     Purging closed accounts on an annual basis

      CERTIFICATE ISSUANCE

      -     Issuance, cancellation and registration of up to 5,000
            certificates per fund per annum, additional to be billed
            at $1.25 each, to include the following services:

            -     Production and mailing of daily transfer reports

            -     Processing of all legal transfers including New
                  York window and mail items

            -     Combining certificates into large and/or smaller
                  denominations

            -     Replacing lost certificates

            -     Placing, maintaining and removing stop-transfer
                  notations

      ANNUAL MEETING SERVICES

      -     Preparing a full stockholder list as of the Annual
            Meeting Record Date

      -     Printing and addressing proxy cards for all registered
            shareholders

      -     Enclosing and mailing proxy card, proxy statement,
            return envelope and Annual Report to all registered
            shareholders

      -     Receiving, opening and examining returned proxies

      -     Tabulating returned proxies

      -     Attending Annual Meeting as Inspector of Election
            (Travel expenses billed as incurred)

      -     Preparing a final Annual Meeting List reflecting how
            each account has voted on each proposal

      MAILING AND REPORTING SERVICES

      -     Preparing a set of mailing labels for registered
            shareholders per fund three (3) times per annum

      -     Preparing three (3) standard reports per Customer at the
            Customer's discretion per annum

      DIVIDEND SERVICES

      As Dividend Disbursing Agent and Paying Agent (checks to be
      drawn on State Street Bank and funding must be via ACH on the
      mail date), State Street will perform the following dividend
      related services:

                                     Page 2
<PAGE>

      -     Preparing and mailing up to 12 dividend checks per annum
            (check includes address change feature) with an
            additional enclosure with each dividend check

      -     Direct deposit of dividends via ACH (Additional fee of
            $150.00 per fund per dividend will be billed for ACH
            services)

      -     Preparing a hardcopy dividend list as of each dividend
            record date

      -     Preparing and filing Federal Information Returns (Form
            1099) of dividends paid in a year and mailing a
            statement to each stockholder

      -     Preparing and filing State Information Returns of
            dividends paid in a year to stockholders resident within
            such state

      -     Preparing and filing annual withholding return (Form
            1042) and payments to the government of income taxes
            withheld from Non-Resident Aliens

      -     Replacing lost dividend checks

      -     Providing photocopies of canceled checks when requested

      -     Reconciling paid and outstanding checks

            Coding "undeliverable" accounts to suppress mailing
            dividend checks to same, per SEC regulations

            Processing and recordkeeping of accumulated uncashed
            dividends

            Furnishing requested dividend information to
            stockholders

            Performing the duties as required by the Interest and
            Dividend Tax Compliance Act of 1983

      DIVIDEND REINVESTMENT SERVICES

      -     Processing reinvestment and/or cash investment
            transactions of Dividend Reinvestment Plan (DRP)
            participant accounts

      -     Preparing and mailing up to 12 dividend reinvestment/
            cash investment statements annually with an additional
            enclosure to each DRP participant

      -     Maintaining DRP accounts and establishing new
            participant accounts Processing termination/sale
            requests

      -     Processing withdrawal requests

      -     Supplying summary reports for each reinvestment/investment to Fund
            Preparing and mailing Form 1099, Form 1042, and Form 1099B to
            participants and related filings with the IRS

                                     Page 3
<PAGE>

                                ITEMS NOT COVERED

ADDITIONAL SERVICES

Items not included in the fees and services set forth in this Fee and Service
Schedule including, but not limited to, services associated with the payment of
a stock dividend, rights offering, corporate reorganization, or any services
associated with a special project are to be billed separately, on an appraisal
basis.

Services required by legislation or regulatory fiat which become effective after
the date of acceptance of this Fee and Service Schedule shall not be a part of
the Standard Services and shall be billed by appraisal. All additional services
not specifically covered under this Fee and Service Schedule will be billed by
appraisal, as applicable.

OUT OF POCKET EXPENSES

All direct out-of-pocket expenses will be billed as incurred. A list of
applicable out-of-pocket expenses is attached as Exhibit A.

                                   ACCEPTANCE

In witness whereof, the parties hereto have caused this Fee and Service Schedule
to be executed by their respective officers, hereunto duly agreed and
authorized, as of the effective date of this Fee and Service Schedule.

EQUISERVE, INC.                                 CERTAIN VAN KAMPEN CLOSED END
EQUISERVE TRUST COMPANY, N.A.                   FUNDS

On Behalf of Both Entities:

By: /s/ Dennis V. Moccia                  By: /s/ John L Sullivan
    ---------------------------               -------------------------------
Name: Dennis V. Moccia                    Name: John L Sullivan
Title: Managing Director                  Title: Treasurer

      THIS FEE AND SERVICE SCHEDULE SHALL SERVE AS AN ATTACHMENT TO THE TRANSFER
AGENCY AND STOCK TRANSFER SERVICES AGREEMENT BETWEEN THE PARTIES.

                                     Page 4
<PAGE>

                                    EXHIBIT A
                             OUT OF POCKET EXPENSES

      Out of pocket expenses associated with, but not limited to, the following
are NOT included in the fees quoted in this Fee and Service Schedule and are
billable as incurred.

POSTAGE (Outgoing and Business Reply)
ENVELOPES
LABELS
FORMS, STATIONERY AND PROXY CARDS
FULFILLMENT
PROXY PROOF SET-UP
RECORD RETENTION
INSURANCE PREMIUMS (Mailing certificates)
DELIVERY AND FREIGHT CHARGES (including overnight delivery; Airborne Express,
FedEx, etc.)
TYPESETTING (proxy cards, due diligence mailings, etc.)
DESTRUCTION OF EXCESS/OBSOLETE MATERIAL
DTC TRADE TRANSACTIONS EXPENSES (Treasury buybacks, etc.)
CUSTODY SETTLEMENT CHARGES
TELEPHONE USAGE AND LINE EXPENSES
LOST SHAREHOLDER PROGRAM DATABASE SEARCH

PLEASE NOTE:

Other out of pocket expenses could be incurred depending on the services
utilized.

Good funds to cover postage expenses in excess of $5,000 for shareholder
mailings must be received in full by 12:00 p.m. Eastern Time on the scheduled
mailing date. Postage expenses less than $5,000 will be billed as incurred.

SKU numbers are required on all material received for mailing. A special
handling fee of $10.00 per box will be assessed for all material not marked with
a SKU number. Such material includes, but is not limited to: proxy statements,
annual and quarterly reports, and news releases. Overtime charges will be
assessed in the event of late delivery of material for mailings to shareholders
unless the mail date is rescheduled. Please see attached Exhibit B regarding
packaging and shipping materials to EquiServe.

                                     Page 5
<PAGE>

                                    EXHIBIT B

                     SPECIFICATIONS FOR PACKING AND SHIPPING
                             MATERIALS TO EQUISERVE

      PLEASE FOLLOW THESE PACKING AND SHIPPING GUIDELINES TO HELP US HANDLE YOUR
MATERIALS MOST EFFICIENTLY. FOR SPECIFICS CONCERNING YOUR COMPANY'S MAILING,
PLEASE CONTACT YOUR CLIENT SERVICES TEAM.

      DELIVERY TIMING:

      Please ship your materials to arrive according to the schedule listed
      below. Some larger mailings will require more time. If more time is
      needed, our client service team will work with you to schedule the
      appropriate amount of time for processing your mailing.

            1 -10,000        Noon 2 business days prior to the mail date

            10,000 -25,000   By 5 p.m. 3 business days prior to the mail date

            25,000 -50,000   By 5 p.m. 4 business days prior to the mail date

            50,001 +         Acct. Manager will establish delivery schedule with
                             Client and Output Services

- -     SHIPPING ADDRESSES:

            EQUISERVE: Raritan Center, 118 Fernwood Avenue, Edison NJ 08837-3857

            OUTPUT TECHNOLOGY SOLUTIONS: Eastern Region, 46 Harvard Street,
            Westwood MA 02090-2398

            OUTPUT TECHNOLOGY SOLUTIONS: Hartford Region, 125 Ellington Road So.
            Windsor CT 06074-4112

            CIC: 130 Commerce Road, Carlstadt NJ 07072

            STANDARD REGISTER: Affiliated Warehouse, Inc., 353 Howard St,
            Brockton MA 02302

- -     RECEIVING HOURS:

      Monday through Friday, 8:00 a.m. to 4:00 p.m.

      WITH ADVANCE NOTICE, WE OFFER EXTENDED DOCK HOURS DURING PROXY SEASON. TO
      ARRANGE EXTENDED HOURS (AFTER 4:00 P.M. AND WEEKENDS) PLEASE CONTACT YOUR
      CLIENT SERVICES TEAM.

- -     DOCUMENTATION:

      Every shipment, including courier deliveries, needs proper documentation:
      a delivery receipt AND a packing list. Both should include the following
      information:

            1.    NAME OF CLIENT

            2.    DESCRIPTION OF MATERIAL

            3.    SKU OR FORM NUMBER (SEE ATTACHED)

            4.    TOTAL NUMBER OF BOXES/PACKAGES DELIVERED

            5.    QUANTITY PER BOX/PACKAGE

            6.    TOTAL NUMBER OF PIECES DELIVERED/VOLUME

            7.    IDENTIFICATION OF PARTIAL SHIPMENT

            8.    PURCHASE ORDER NUMBER IF AVAILABLE

                                     Page 6
<PAGE>

            You can prepare one document and make copies to use for both
            purposes. Attach the packing list to the outside of one box in an
            envelope or plastic pouch.

PACKING POINTERS:

      DO NOT SHRINK-WRAP MATERIALS INDIVIDUALLY OR IN BUNDLES. THIS INCLUDES
      ANNUAL REPORTS. Use Only paper bands if sending banded material. Please do
      not use string, strapping or rubber bands. When bundling or grouping
      material, please make sure that ALL pieces in the bundle or group face in
      the same direction. Box or package each type of enclosure separately. DO
      NOT MIX ENCLOSURES IN CARTONS.

      Label cartons to show the type of material and number of pieces.
      Attach a sample of the material to the outside of each carton.
      Maximum weight per carton should not exceed 50 lbs.

- -     QUARTERLY REPORTS, FOLDED PROXY STATEMENTS AND NEWSLETTERS:

      Paper-band material in groups of 50 to 100.
      Use paper bands that are at least 2-1/2 to 3 inches wide.
      Place cardboard sheets between each layer.
      To eliminate the need for cardboard, you can crisscross the groups of
      reports or statements.

- -     ANNUAL REPORTS AND FLAT PROXY STATEMENTS:

      Layer in groups of 50 Annual Reports.
      DO NOT SHRINK-WRAP INDIVIDUAL PIECES OR GROUPS OF PIECES.
      Place cardboard sheets between each layer.
      To eliminate the need for cardboard, you can crisscross the groups of
      reports or statements.

      DO NOT PLACE LAYERS OF PAPER OR CARDBOARD BETWEEN INDIVIDUAL REPORTS.

- -     USING SKIDS:

      Place only one type of material on each skid. If you load cartons on a
      skid, each carton should contain the same number of pieces.

      Maximum skid size: 40" x 48"
      Maximum height: 54" - including pallet
      Maximum weight: 3,000 lbs.

      Pallet must be forklift accessible on the 40" side.
      Pallet and contents should be shrink-wrapped to prevent spillage

- -     USING SKID PACKS OR POWER PACKS:

      Most printers are able to wrap material neatly and securely on skids
      without using cartons. We strongly recommend this packing method,
      especially for clients with shareholder bases of more than 40,000.

      Skid packs, also known as Power packs or Gaylords, cut expenses and
      processing time. Unnecessary cartons cost money, delay processing and must
      be disposed of for recycling. Skid packs can be used for nearly any kind
      of mailing enclosure, including quarterly and annual reports, proxy
      statements and newsletters.

      Using skid packs or Power packs (continued):

                                     Page 7
<PAGE>

      Ship only 90% of your material on skid packs. Ship the remaining 10% in
      cartons. We will use the skid packs first for better inventory control and
      easier return shipping of leftover material.

      Have your printer shrink-wrap the cardboard sides of each skid pack for
      added protection against inclement weather. (Don't shrink-wrap individual
      items or bundles of items.)

      SURPLUS MATERIAL: We regret that we do not have warehousing facilities to
      store surplus material after your mail date. Please let your client
      service team know BEFORE your mailing whether you would like us to dispose
      of your material or ship it back at your expense. Special arrangements can
      be made by contacting your client services team.

                                     Page 8
<PAGE>

                             SKU NUMBER INFORMATION

WHAT IS A SKU NUMBER?

     A SKU number is a unique Stock Keeping Unit Number assigned and printed on
     each different type of material mailed. It is anticipated that all print
     vendors will begin incorporating unique and different Stock Keeping Unit
     Numbers on all material delivered to Print/Mail locations.

WHY UTILIZE SKU NUMBERS?

     In an effort to continuously improve service to our mutual clients,
     enhanced quality control practices for inventory tracking purposes have
     been implemented at Print/Mail locations. Improved client specific
     inventory tracking is made possible through the identification of a unique
     stock tracking number by printers.

WHO ASSIGNS THE SKU NUMBER?

     The recommended SKU Number pattern is as follows: Company number or Issue
     ID (client identification numbers) followed by the specific material
     abbreviation, and the current year. This number will be communicated by the
     client for whom the material is being printed, and assigned by the Account
     Administrator at EquiServe. If you need additional information on a SKU
     Number, please contact the Account Administrator at EquiServe (781)
     575-2000.

             SAMPLE SKU NUMBER PATTERNS:

             THE ABC COMPANY 1998 ANNUAL REPORT              "0707-AR-98"
XYZ Financial 1998 Proxy Statement "XYZCM- PS- 98"

      ARE THERE SPECIFIC LIMITATIONS AND PRINTING CONSIDERATIONS? YES!
         CHARACTER LIMITATION OF 15 SPACES.

      -  DASHES RECOMMENDED (TO BETTER SEPARATE KEY INFORMATION).

      -  EACH DASH REPRESENTS A CHARACTER LIMITATION.

      -  POSITION OF NUMBER:

                  Booklet style material; reverse side of document, lower right
                  corner.

                  One page material; front of document, lower right corner.

                                     Page 9
<PAGE>

                                   APPENDIX A

Van Kampen Advantage Municipal Income Trust
Van Kampen Advantage Municipal Income Trust II
Van Kampen Advantage Pennsylvania Municipal Income Trust
Van Kampen Bond
Van Kampen California Municipal Trust
Van Kampen California Quality Municipal Trust
Van Kampen California Value Municipal Income Trust
Van Kampen Florida Quality Municipal Trust
Van Kampen High Income Trust
Van Kampen High Income Trust II
Van Kampen Income Trust
Van Kampen Investment Grade Municipal Trust
Van Kampen Massachusetts Value Municipal Income Trust
Van Kampen Municipal Income Trust
Van Kampen Municipal Opportunity Trust
Van Kampen Municipal Opportunity Trust II
Van Kampen Municipal Trust
Van Kampen New York Quality Municipal Trust
Van Kampen New York Value Municipal Income Trust
Van Kampen Ohio Quality Municipal Trust
Van Kampen Ohio Value Municipal Income Trust
Van Kampen Pennsylvania Quality Municipal Trust
Van Kampen Pennsylvania Value Municipal Income Trust
Van Kampen Select Sector Municipal Trust
Van Kampen Strategic Sector Municipal Trust
Van Kampen Trust for Investment Grade California Municipals
Van Kampen Trust for Investment Grade Florida Municipals
Van Kampen Trust for Investment Grade Municipals
Van Kampen Trust for Investment Grade New Jersey Municipals
Van Kampen Trust for Investment Grade New York Municipals
Van Kampen Trust for Investment Grade Pennsylvania Municipals
Van Kampen Trust for Insured Municipals
Van Kampen Value Municipal Income Trust
Van Kampen Senior Income Trust
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(13)(B)
<SEQUENCE>14
<FILENAME>c93084a1exv99wx13yxby.txt
<DESCRIPTION>AUCTION AGENCY AGREEMENT
<TEXT>
<PAGE>
                                                                   EXHIBIT 13(b)

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


                            AUCTION AGENCY AGREEMENT


                                     between


                       VAN KAMPEN MERRITT MUNICIPAL TRUST


                                       and


                              BANKERS TRUST COMPANY


                          Dated as of December 10, 1991



                                   Relating to


                 Auction Preferred Shares, Series A, B, C and D


                                       of


                       VAN KAMPEN MERRITT MUNICIPAL TRUST


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







<PAGE>





                                TABLE OF CONTENTS
<TABLE>
<CAPTION>

                                                                                                             PAGE
<S>               <C>                                                                                        <C>
SECTION 1         DEFINITIONS AND RULES OF CONSTRUCTION..........................................................1

                  1.1      Terms Defined by Reference to
                             APS Provisions......................................................................1

                  1.2      Terms Defined Herein..................................................................1

                  1.3      Rules of Construction.................................................................3

SECTION 2         THE AUCTION....................................................................................3

                  2.1      Purpose; Incorporation by Reference of Auction
                             Procedures and Settlement Procedures................................................3

                  2.2      Preparation of Each Auction; Maintenance of
                             Registry of Beneficial Owners.......................................................4

                  2.3      Information Concerninq Rates..........................................................7

                  2.4      Auction Schedule......................................................................11

                  2.5      Designation of Special Dividend Period................................................12

                  2.6      Allocation of Taxable Income..........................................................14

                  2.7      Failure to Deposit....................................................................15

                  2.8      Broker-Dealers........................................................................17

                  2.9      Ownership of Shares of APS............................................................18

                  2.10     Access to and Maintenance of
                             Auction Records.....................................................................18

                  2.11     Dividend and Redemption Price Deposit.................................................19

SECTION 3         THE AUCTION AGENT AS DIVIDEND
                    AND REDEMPTION PRICE DISBURSING AGENT........................................................19

SECTION 4         THE AUCTION AGENT AS TRANSFER AGENT
                    AND REGISTRAR................................................................................20

                  4.1      Issue Of Share Certificates...........................................................20

</TABLE>



                                       i
<PAGE>


<TABLE>


<S>               <C>                                                                                        <C>
                  4.2      Registration of Transfer of Shares....................................................20

                  4.3      Removal of Legend on Restricted Shares................................................20

                  4.4      Lost Share Certificates...............................................................20

                  4.5      Disposition of Cancelled
                             Certificates; Record Retention......................................................20

                  4.6      Share Transfer Books..................................................................21

                  4.7      Return of Funds.......................................................................21

SECTION 5         REPRESENTATIONS AND WARRANTIES OF THE FUND.....................................................21

SECTION 6         THE AUCTION AGENT..............................................................................23

                  6.1      Duties and Responsibilities...........................................................23

                  6.2      Rights of the Auction Agent...........................................................23

                  6.3      Auction Agent's Disclaimer............................................................24

                  6.4      Compensation, Expenses and
                             Indemnification.....................................................................24

SECTION 7         MISCELLANEOUS..................................................................................25

                  7.1      Term of Agreement.....................................................................25

                  7.2      Communications........................................................................25

                  7.3      Entire Agreement......................................................................26

                  7.4      Benefits..............................................................................27

                  7.5      Amendment; Waiver.....................................................................27

                  7.6      Successors and Assigns................................................................27

                  7.7      Limitation of Liability...............................................................27

                  7.8      Severability..........................................................................27

                  7.9      Execution in Counterparts.............................................................27

                  7.10     Governing Law.........................................................................28

</TABLE>


                                       ii

<PAGE>





                                    EXHIBITS

EXHIBIT A - Broker-Dealer Agreement
EXHIBIT B - Form of Master Purchaser's Letter
EXHIBIT C - Settlement Procedures
EXHIBIT D - Form of APS Provisions
EXHIBIT E - Form of Notice of Auction Dates
EXHIBIT F - Form of Notice of Proposed Change of Length of Rate
                Period
EXHIBIT G - Form of Notice of Change of Length of Rate Period
EXHIBIT H - Form of Notice of Determination Not to Change Length of
                Rate Period
EXHIBIT I - Form of Notice of Cure of Failure to Deposit
EXHIBIT J - Form of Notice of Subsequent Cure of Failure to Deposit
EXHIBIT K - Form of Notice of Capital Gain and Taxable Ordinary
                Income Dividend




                                      iii
<PAGE>





                  AUCTION AGENCY AGREEMENT dated as of December 10, 1991 between
VAN KAMPEN MERRITT MUNICIPAL TRUST, a Massachusetts business trust (the "Fund"),
and Bankers Trust Company, a New York banking corporation (the "Auction
Agent").

                  WHEREAS, the Fund proposes to issue four series of preferred
shares of beneficial interest, par value $.01 per share, liquidation preference
$50,000 per share, designated Auction Preferred Shares (the "APS") pursuant to
the APS Provisions (as hereinafter defined) and desires that the Auction Agent
perform certain duties in connection with the APS upon the terms and subject to
the conditions of this Agreement, and hereby appoints the Auction Agent to act
in the capacities set forth in this Agreement.

                  NOW, THEREFORE, in consideration of the premises and the
mutual covenants contained herein, the Fund and the Auction Agent agree as
follows:

1.       Definitions and Rules of Construction.


                  1.1 Terms Defined by Reference to APS Provisions. Capitalized
terms not defined herein shall have the respective meanings specified in the APS
Provisions.

                  1.2 Terms Defined Herein. As used herein and in the Settlement
Procedures, the following terms shall have the following meanings, unless the
context otherwise requires:

                           (a) "Agent Member" of any Person shall mean the
member of, or participant in, the Securities Depository that will act on behalf
of a Bidder and is identified as such in such Bidder's Master Purchaser's
Letter.

                           (b) "APS Provisions" shall mean the Certificate of
Vote of the Fund's Board of Trustees establishing the series of shares of APS
pursuant to the Amended and Restated Declaration of Trust of the Fund and
attached hereto as Exhibit D.

                           (c) "Auction" shall have the meaning specified in
Section 2.1 hereof.



<PAGE>





                           (d) "Auction Procedures" shall mean the auction
procedures constituting Part II of the form of APS provisions.

                           (e) "Authorized Officer" shall mean each Senior Vice
President, Vice President, Assistant Vice President, Assistant Treasurer and
Assistant Secretary of the Auction Agent and every other officer or employee of
the Auction Agent designated as an "Authorized Officer" for purposes hereof in a
communication to the Fund.

                           (f) "Broker-Dealer" shall mean any broker-dealer,
commercial bank or other entity permitted by law to perform the functions of a
Broker-Dealer that is a member of, or a participant in, the Securities
Depository or is an affiliate of such member or participant, has been selected
by the Fund and has entered into a Broker-Dealer Agreement that remains
effective.

                           (g) "Broker-Dealer Agreement" shall mean each
agreement among the Fund, the Auction Agent and a Broker-Dealer substantially in
the form attached hereto as Exhibit A.

                           (h) "Existing Holder," when used with respect to
shares of any series of APS, shall mean a Person who has signed a Master
Purchaser's Letter and is listed as the beneficial owner of such shares of APS
in the records of the Auction Agent.

                           (i) "Fund Officer" shall mean the Chairman of the
Board of Trustees of the Fund, the President, each Vice President (whether or
not designated by a number or word or words added before or after the title
"Vice President"), the Secretary, the Treasurer, each Assistant Secretary and
each Assistant Treasurer of the Fund and every other officer or employee of the
Fund designated as a "Fund Officer" for purposes hereof in a notice to the
Auction Agent.

                           (j) "Master Purchaser's Letter" shall mean a letter
addressed to the Fund, the Auction Agent, a Broker-Dealer and an Agent Member,
substantially in the form attached hereto as Exhibit B.

                           (k) "Potential Holder," when used with respect to
shares of any series of APS, shall mean any Person, including any Existing
Holder of shares of such


                                       2
<PAGE>





series of APS, (i) who shall have executed a Master Purchaser's Letter and (ii)
who may be interested in acquiring shares of such series of APS (or, in the
case of an Existing Holder of shares of such series of APS, additional shares
of such series of APS).

                           (l) "Settlement Procedures" shall mean the Settlement
Procedures attached hereto as Exhibit C.

                           (m) "Underwriters" shall mean Goldman, Sachs & Co.,
Smith Barney, Harris Upham & Co., PaineWebber Incorporated, Prudential
Securities Incorporated and any other person named as an underwriter of the APS
in the Underwriting Agreement or any schedule thereto.

                           (n) "Underwriting Agreement" shall mean the
Underwriting Agreement dated December 5, 1991 among the Fund and the
Underwriters.

                  1.3 Rules of Construction. Unless the context or use indicates
another or different meaning or intent, the following rules shall apply to the
construction of this Agreement:

                           (a) Words importing the singular number shall include
the plural number and vice versa.

                           (b) The captions and headings herein are solely for
convenience of reference and shall not constitute a part of this Agreement nor
shall they affect its meaning, construction or effect.

                           (c) The words "hereof", "herein", "hereto" and other
words of similar import refer to this Agreement as a whole.

                           (d) All references herein to a particular time of day
shall be to New York City time.

2.       The Auction.

                  2.1 Purpose; Incorporation by Reference of Auction Procedures
and Settlement Procedures. (a) The APS Provisions provide that the Applicable
Rate per annum for each series of APS for each Subsequent Dividend Period after
the Initial Dividend Period with respect to each series of APS shall, except
under certain conditions, be equal to the rate per annum that a bank or trust
company


                                       3
<PAGE>





appointed by the Fund advises has resulted on the Business Day preceding the
first day of such Subsequent Dividend Period from implementation of the Auction
Procedures for such series. Each periodic implementation of the Auction
Procedures is hereinafter referred to as an "Auction." The Board of Trustees
has adopted a resolution appointing Bankers Trust Company as Auction Agent for
purposes of the Auction Procedures for each series of the APS. The Auction Agent
accepts such appointment and agrees to follow the procedures set forth in this
Section 2 and the Auction Procedures for the purpose of determining the
Applicable Rate for each series of APS for each Subsequent Dividend Period
thereof for which the Applicable Rate is to be determined by an Auction.

                           (b) All of the provisions contained in the Auction
Procedures and the Settlement Procedures are incorporated herein by reference in
their entirety and shall be deemed to be a part hereof to the same extent as if
such provisions were fully set forth herein.

                  2.2 Preparation of Each Auction; Maintenance of Registry of
Beneficial Owners. (a) Not later than seven days prior to the first Auction Date
for the first series of APS, the Fund shall provide the Auction Agent with a
list of the Broker-Dealers and a manually signed copy of each Broker-Dealer
Agreement for execution by the Auction Agent. Not later than seven days prior to
any Auction Date for any series of APS for which any change in such list of
Broker-Dealers is to be effective, the Fund will notify the Auction Agent in
writing of such change and, if any such change involves the addition of a
Broker-Dealer to such list, shall cause to be delivered to the Auction Agent for
execution by the Auction Agent a Broker-Dealer Agreement signed by such
Broker-Dealer; provided, however, that if the Fund proposes to designate any
Special Dividend Period of any series of APS pursuant to Section 4 of Part I of
the APS Provisions, not later than 11:00 A.M., New York City time, on the
Business Day next preceding the Auction next preceding the first day of such
Special Dividend Period, the Fund shall provide the Auction Agent with a list of
the Broker-Dealers for such series and a manually signed copy of each
Broker-Dealer Agreement or a new Schedule A to the Broker-Dealer Agreement
(which Schedule A shall replace and supersede any previous Schedule A to such
Broker-Dealer Agreement) with each Broker-Dealer for such series. The Auction
Agent and the Fund shall have entered into a Broker-

                                       4

<PAGE>





Dealer Agreement with each Broker-Dealer prior to the participation of any such
Broker-Dealer in any Auction.

                           (b) In the event that any Auction Date for any series
of APS shall be changed after the Auction Agent shall have given the notice
referred to in clause (vi) of paragraph (a) of the Settlement Procedures, or
after the notice referred to in Section 2.5(a) hereof, if applicable, the
Auction Agent, by such means as the Auction Agent deems practicable, shall give
notice of such change to the Broker-Dealers for such series not later than the
earlier of 9:15 A.M. on the new Auction Date or 9:15 A.M. on the old Auction
Date.

                           (c)   (i)  The Auction Agent shall maintain
         a registry of the beneficial owners of the shares of each series of APS
         who shall constitute Existing Holders of shares of such series of APS
         for purposes of Auctions and shall indicate thereon the identity of
         the respective Broker-Dealer of each Existing Holder, if any, on whose
         behalf such Broker-Dealer submitted the most recent Order in any
         Auction which resulted in such Existing Holder continuing to hold or
         purchasing shares of such series of APS. The Auction Agent shall keep
         such registry current and accurate. The Fund shall provide or cause
         to be provided to the Auction Agent at or prior to the Date of Original
         Issue of each series of APS a list of the initial Existing Holders of
         the shares of each such series, the number of shares purchased by each
         such Existing Holder and the respective Broker-Dealer of each such
         Existing Holder or the affiliate thereof through which each such
         Existing Holder purchased such shares. The Auction Agent shall advise
         the Fund in writing whenever the number of Existing Holders is 500 or
         more. The Auction Agent may rely upon, as conclusive evidence of the
         identities of the Existing Holders of shares of any series of APS, (A)
         such list, (B) the results of Auctions and (C) notices from any
         Existing Holder, the Agent Member of any Existing Holder or the
         Broker-Dealer of any Existing Holder as described in the first
         sentence of Section 2.2(c)(iii) hereof.

                                       5
<PAGE>





                                    (ii) In the event of any partial redemption
         of any series of APS, the Auction Agent shall, at least two Business
         Days prior to the next Auction for such series, request the Agent
         Member of each Existing Holder of shares of APS of such series to
         disclose to the Auction Agent (upon selection by such Agent Member of
         the Existing Holders whose shares of APS of such series are to be
         redeemed) the number of shares of APS of such series, if any, of such
         Existing Holder which are subject to such redemption, provided the
         Auction Agent has been furnished with the name and telephone number of
         a person or department at such Agent Member from which it shall
         request such information. Upon any refusal of an Agent Member to
         release such information, the Auction Agent shall deliver to such Agent
         Member a facsimile copy of the Existing Holder's Master Purchaser's
         Letter, which authorizes and instructs such Agent Member to release
         such information to the Auction Agent. In the absence of receiving any
         such information with respect to an Existing Holder, from such
         Existing Holder's Agent Member or otherwise, the Auction Agent may
         continue to treat such Existing Holder as the beneficial owner of the
         number of shares of APS of such series shown in the Auction Agent's
         registry.

                                    (iii) The Auction Agent shall be required to
         register a transfer of shares of APS of any series from an Existing
         Holder of such shares of APS to another Person only if such transfer is
         made to a Person that has delivered, or on whose behalf has been
         delivered, a signed Master Purchaser's Letter to the Auction Agent and
         if (A) such transfer is pursuant to an Auction or (B) the Auction
         Agent has been notified in writing (I) in a notice substantially in the
         form of Exhibit D to the Broker-Dealer Agreements by such Existing
         Holder, the Agent Member of such Existing Holder or the Broker-Dealer
         of such Existing Holder of such transfer or (II) in a notice
         substantially in the form of Exhibit E to the Broker-Dealer Agreements
         by the Broker-Dealer of any Person that purchased or sold such APS in
         an Auction


                                       6
<PAGE>





         of the failure of such shares of APS to be transferred as a result of
         such Auction. The Auction Agent is not required to accept any such
         notice for an Auction unless it is received by the Auction Agent by
         3:00 P.M. on the Business Day preceding such Auction.

                                    (iv) The Auction Agent is not required to
         accept the Master Purchaser's Letter of any Potential Holder who
         wishes to submit a Bid for the first time in an Auction or of any
         Potential Holder or Existing Holder who wishes to amend its Master
         Purchaser's Letter unless such letter or amendment is received by the
         Auction Agent by 3:00 P.M. on the Business Day preceding such Auction.

                           (d) The Auction Agent may request the Broker-Dealers,
as set forth in the Broker-Dealer Agreements, to provide the Auction Agent with
a list of their respective customers that such Broker-Dealers believe are
Existing Holders of shares of any series of APS. The Auction Agent shall keep
confidential such registry of Existing Holders and shall not disclose the
identities of the Existing Holders of such shares of APS to any Person other
than the Fund and the Broker-Dealer that provided such information.

                  2.3 Information Concerninq Rates. (a) The Applicable
Percentage on the date of this Agreement for APS is 110%. If there is any change
in the credit rating of APS by either of the rating agencies (or substitute or
successor rating agencies) referred to in the definition of "Applicable
Percentage" resulting in any change in the Applicable Percentage for APS after
the date of this Agreement, the Fund shall notify the Auction Agent in writing
of such change in the Applicable Percentage prior to 12:00 Noon on the Business
Day prior to the next Auction Date for any series of APS succeeding such
change. If the Fund designates all or a portion of any dividend on shares of any
series of APS to consist of net capital gains or other income taxable for
federal income tax purposes, it will indicate, in its notice in the form of
Exhibit K hereto to the Auction Agent pursuant to Section 2.6 hereof, the
Applicable Percentage for such series to be in effect for the Auction Date on
which the dividend rate for such dividend is to be fixed. In determining the
Maximum Rate for any series of APS on any Auction


                                       7
<PAGE>




Date as set forth in Section 2.3(b)(i) hereof, the Auction Agent shall be
entitled to rely on the last Applicable Percentage for APS of which it has most
recently received notice from the Fund (or, in the absence of such notice, the
percentage set forth in the first sentence of this paragraph (a)), except that
if the Fund shall have notified the Auction Agent of an Applicable Percentage to
be in effect for an Auction Date in accordance with the preceding sentence, the
Applicable Percentage in effect for the next succeeding Auction Date of any
series of APS shall be, unless the Fund notifies the Auction Agent of a change
in the Applicable Percentage for such succeeding Auction Date pursuant to this
Section 2.3(a), the Applicable Percentage that was in effect on the first
preceding Auction Date for APS with respect to which the dividend, the rate
for which was fixed on such Auction Date, did not include any net capital gains
or other income taxable for federal income tax purposes.

                           (b) (i) On each Auction Date for any series of APS,
         the Auction Agent shall deter-mine the Maximum Rate for such series.
         The Maximum Rate for any series of APS on any Auction Date shall be:

                                    (A) in the case of any Auction Date which is
                           not the Auction Date immediately prior to the first
                           day of any proposed Special Dividend Period
                           designated by the Fund pursuant to Section 4 of Part
                           I of the APS Provisions, the product of (1) the "AA"
                           Composite Commercial Paper Rate on such Auction Date
                           for the next Rate Period of such series and (2) the
                           Applicable Percentage on such Auction Date, unless
                           such series has or had a Special Dividend Period
                           (other than a Special Dividend Period of 28 Rate
                           Period Days or less) and an Auction at which
                           Sufficient Clearing Bids existed has not yet occurred
                           for a Minimum Dividend Period of such series after
                           such Special Dividend Period, in which case the
                           higher of:

                                             (1) the dividend rate on shares of
                                    such series for the then-ending Rate Period,
                                    and

                                       8

<PAGE>





                                             (2) the product of x) the higher of
                                    (I) the "AA" Composite Commercial Paper
                                    Rate on such Auction Date for the
                                    then-ending Rate Period of such series, if
                                    such Rate Period consists of less than four
                                    Dividend Periods, or the Treasury Rate on
                                    such Auction Date for such Rate Period, if
                                    such Rate Period consists of four or more
                                    Dividend Periods and (II) the "AA" Composite
                                    Commercial Paper Rate on such Auction Date
                                    for such Special Dividend Period of such
                                    series, if such Special Dividend Period is
                                    less than four Dividend Periods, or the
                                    Treasury Rate on such Auction Date for such
                                    Special Dividend Period, if such Special
                                    Dividend Period consists of four or more
                                    Dividend Periods, and (y) the Applicable
                                    Percentage on such Auction Date; or

                                    (B) in the case of any Auction Date which is
                           the Auction Date immediately prior to the first day
                           of any proposed Special Dividend Period designated
                           by the Fund pursuant to Section 4 of Part I of the
                           APS Provisions, the product of (1) the highest of (x)
                           the "AA" Composite Commercial Paper Rate on such
                           Auction Date for the then-ending Rate Period of such
                           series, if such Rate Period consists of four or more
                           Dividend Periods, or the Treasury Rate on such
                           Auction Date for such Rate Period, if such Rate
                           Period consists of four or more Dividend Periods, (y)
                           the "AA" Composite Commercial Paper Rate on such
                           Auction Date for such Special Dividend Period of such
                           series for which the Auction is being held, if such
                           Special Dividend Period consists of less than four
                           Dividend Periods, or the Treasury Rate on such
                           Auction Date for such Special Dividend Period of
                           such series for which the Auction is being held, if
                           such Special Dividend Period consists of less than
                           four Dividend Periods, and (z) the "AA" Composite


                                       9
<PAGE>





                           Commercial Paper Rate on such Auction Date for
                           Minimum Dividend Periods and (2) the Applicable
                           Percentage on such Auction Date.

         Not later than 9:30 A.M. on each Auction Date, the Auction Agent shall
         notify the Fund and the Broker-Dealers of the Maximum Rate so
         determined and the "AA" Composite Commercial Paper Rate(s) and Treasury
         Rate(s), as the case may be, used to make such determination.

                           (ii) From and after a Failure to Deposit by the Fund
         during any Rate Period of any series of APS, until such failure is
         cured and a late charge, if applicable, is paid, in accordance with
         subparagraph (c)(i) of Section 2 of Part I of the APS Provisions, on
         the first day of each Rate Period of such series the Auction Agent
         shall determine the Treasury Rate for such Rate Period with four or
         more Dividend Periods and the "AA" Composite Commercial Paper Rate for
         Minimum Dividend Periods and Rate Periods with less than four Dividend
         Periods. Not later than 9:30 A.M. on each such first day, the Auction
         Agent shall notify the Fund of the applicable "AA" Composite
         Commercial Paper Rate and Treasury Rate.

                           (iii) If any "AA" Composite Commercial Paper Rate or
         Treasury Rate, as the case may be, is not quoted on an interest basis,
         the Auction Agent shall convert the quoted rate to the interest
         equivalent thereof as set forth in the definition of such rate in the
         APS Provisions if the rate obtained by the Auction Agent is quoted on a
         discount basis, or if such rate is quoted on a basis other than an
         interest or discount basis the Auction Agent shall convert the quoted
         rate to an interest rate after consultation with the Fund as to the
         method of such conversion.

                           (iv) If any "AA" Composite Commercial Paper Rate is
         to be based on rates supplied by Commercial Paper Dealers and one or
         more of the Commercial Paper Dealers shall not provide a quotation for
         the determination of


                                       10
<PAGE>





         such "AA" Composite Commercial Paper Rate, the Auction Agent shall
         immediately notify the Fund so that the Fund can determine whether to
         select a Substitute Commercial Paper Dealer or Substitute Commercial
         Paper Dealers to provide the quotation or quotations not being supplied
         by any Commercial Paper Dealer or Commercial Paper Dealers. The Fund
         shall promptly advise the Auction Agent of any such selection.

                           (v) If any Treasury Rate is to be based on rates
         supplied by U.S. Government Securities Dealers and one or more of the
         U.S. Government Securities Dealers shall not provide a quotation for
         the determination of such Treasury Rate, the Auction Agent shall
         immediately notify the Fund so that the Fund can determine whether to
         select a Substitute U.S. Government Securities Dealer or Substitute
         U.S. Government Securities Dealers to provide the quotation or
         quotations not being supplied by any U.S. Government Securities Dealer
         or U.S. Government Securities Dealers. The Fund shall promptly advise
         the Auction Agent of any such selection.

                  (c) The greater of the maximum marginal regular federal
individual income tax rate applicable to ordinary income or the maximum marginal
regular federal corporate income tax rate (the "Highest Marginal Rate") on the
date of this Agreement is 34%. If there is any change in the Highest Marginal
Rate, the Fund shall notify the Auction Agent in writing of such change prior
to 12:00 Noon on the Business Day prior to the next Auction Date for APS
succeeding such change. In determining the Maximum Rate for any series of APS on
any Auction Date, the Auction Agent shall be entitled to rely on the Highest
Marginal Rate of which it has most recently received notice from the Fund (or,
in the absence of such notice, the percentage set forth in the first sentence of
this paragraph (c)).

         2.4 Auction Schedule. The Auction Agent shall conduct Auctions in
accordance with the schedule set forth below. Such schedule may be changed by
the Auction Agent with the consent of the Fund, which consent shall not be
unreasonably withheld. The Auction Agent shall give written notice of any such
change to each Broker-Dealer. Such notice shall be given prior to the close of


                                       11
<PAGE>





business on the Business Day next preceding the first Auction Date on which any
such change shall be effective.

<TABLE>
<CAPTION>

                       Time                                                    Event
                       ----                                                    -----
<S>                                                      <C>
By 9:30 A.M.                                             Auction Agent advises the Fund and Broker-Dealers
                                                         of the applicable Maximum Rate and the "AA"
                                                         Composite Commercial Paper Rate(s) and Treasury
                                                         Rate(s), as the case may be, used in determining
                                                         such Maximum Rate as set forth in Section 2.3(b)(i)
                                                         hereof.

9:30 A.M. -- 1:30 P.M.                                   Auction Agent assembles information communicated
                                                         to it by Broker-Dealers as provided in Section
                                                         2(a) of the Auction Procedures.  Submission
                                                         Deadline is 1:30 P.M.

Not earlier than 1:30 P.M.                               Auction Agent makes determinations pursuant to
                                                         Section 3(a) of the Auction Procedures.

By approximately 3:00 P.M.                               Auction Agent advises Fund of results of Auction
                                                         as provided in Section 3(b) of the Auction
                                                         Procedures.  Submitted Bids and Submitted Sell
                                                         Orders are accepted and rejected and shares of
                                                         APS allocated as provided in Section 4 of the
                                                         Auction Procedures.  Auction Agent gives notice
                                                         of Auction results as set forth in paragraph (a)
                                                         of the Settlement Procedures.

</TABLE>

         2.5 Designation of Special Dividend Period. (a) The APS Provisions will
provide that, subject to the Fund's option to designate a Special Dividend
Period as


                                       12
<PAGE>



referred to in paragraph (b) of this section 2.5, (i) each Rate Period of any
series of APS will be a Minimum Dividend Period (a duration of 7 Rate Period
Days, subject to certain exceptions with respect to APS Series A and Aps Series
C and a duration of 28 Rate Period Days, subject to certain exceptions with
respect to APS Series B and APS Series D) and (ii) each Rate Period following a
Rate Period of any series of APS that is other than a Minimum Dividend Period
will be a Minimum Dividend Period. Not less than 10 nor more than 20 days
prior to the last day of any such Rate Period that is not a Minimum Dividend
Period, (i) the Fund shall deliver to the Auction Agent a notice of the
Auction Date of the next succeeding Auction for such series in the form of
Exhibit E hereto and (ii) the Auction Agent shall deliver such notice by
first-class mail, postage prepaid, to each Existing Holder of shares of such
series at the address specified in such Existing Holder's Master Purchaser's
Letter and to the Broker-Dealers for such series as promptly as practicable
after its receipt of such notice from the Fund.

                  (b) Pursuant to the APS Provisions, the Fund may, at its
option, designate a Special Dividend Period for any series of APS in the manner
described in Section 4 of Part I of the APS Provisions.

                           (i) If the Fund proposes to designate any succeeding
         Subsequent Dividend Period of any series of APS as a Special Dividend
         Period, (A) the Fund shall deliver to the Auction Agent a notice of
         such proposed Special Dividend Period in the form of Exhibit F hereto
         not less than 20 nor more than 30 days prior to the first day of such
         proposed Special Dividend Period and (B) the Auction Agent on behalf of
         the Fund shall deliver such notice by first-class mail, postage
         prepaid, to each Existing Holder of shares of such series of APS at the
         address specified in such Existing Holder's Master Purchaser's Letter
         and to the Broker-Dealers for such series as promptly as practicable
         after its receipt of such notice from the Fund.

                           (ii) If the Board of Trustees determines to designate
         such succeeding Subsequent Dividend Period as a Special Dividend


                                       13
<PAGE>





         Period, (A) the Fund shall deliver to the Auction Agent a notice of
         such determination in the form of Exhibit G hereto not later than 11:00
         A.M. on the second Business Day next preceding the first day of such
         proposed Special Dividend Period and (B) the Auction Agent shall
         deliver such notice to the Broker-Dealers for such series not later
         than 3:00 P.M. on such second Business Day.

                           (iii) If the Fund shall deliver to the Auction Agent
         a notice stating that the Fund has determined not to exercise its
         option to designate such succeeding Subsequent Dividend Period as a
         Special Dividend Period with respect to which it has delivered a notice
         in the form of Exhibit F hereto not later than 11:00 A.M. on the second
         Business Day next preceding the first day of such proposed Special
         Dividend Period, or shall fail to timely deliver either such notice or
         a notice in the form of Exhibit G hereto, the Auction Agent shall
         deliver a notice in the form of Exhibit H hereto to the Broker-Dealers
         for such series not later than 3:00 P.M. on such second Business Day.

Such change in the length of any Rate Period shall not occur if (a) on the
Auction Date next preceding the first day of such Special Dividend Period
Sufficient Clearing Bids shall not exist or (b) a Failure to Deposit shall have
occurred prior to such change with respect to shares of such series of APS and
shall not have been cured in accordance with the APS Provisions.

         2.6 Allocation of Taxable Income. The Fund may, at its option,
designate all or a portion of any dividend on shares of any series of APS to
consist of net capital gains or other income taxable for federal income tax
purposes by delivering to the Auction Agent a notice in the form of Exhibit K
hereto of such designation 15 days prior to the Auction Date on which the
Applicable rate for such dividend is to be fixed. The Auction Agent will deliver
such notice to the Broker-Dealers for such series on the Business Day following
its receipt of such notice from the Fund. Within two Business Days after any
Auction Date involving the allocation of income taxable for federal income tax
purposes, the Auction Agent shall


                                       14
<PAGE>





notify each Broker-Dealer for the related series as to the dollar amount per
share of such taxable income and income exempt from federal income taxation
included in the related dividend.

         2.7 Failure to Deposit. (a) If:


                           (i) any Failure to Deposit shall have occurred with
         respect to shares of any series of APS during any Rate Period thereof
         (other than any Special Dividend Period consisting of four or more
         Dividend Periods or any Rate Period succeeding any Special Dividend
         Period consisting of four or more Dividend Periods during which a
         Failure to Deposit occurred that has not been cured); and

                           (ii) prior to 12:00 Noon, New York City time, on the
         third Business Day next succeeding the date on which such Failure to
         Deposit occurred, such Failure to Deposit shall have been cured in
         accordance with the next succeeding sentence and the Fund shall have
         paid to the Auction Agent a late charge equal to the sum of (A) if such
         Failure to Deposit consisted of the failure timely to pay to the
         Auction Agent the full amount of dividends with respect to any Dividend
         Period on the shares of such series, an amount computed by multiplying
         (1) 200% of the "AA" Composite Commercial Paper Rate for the Rate
         Period during which such Failure to Deposit occurs on the Dividend
         Payment Date for such Dividend Period by (2) a fraction, the numerator
         of which shall be the number of days for which such Failure to Deposit
         has not been cured in accordance with the next succeeding sentence
         (including the day such Failure to Deposit occurs and excluding the day
         such Failure to Deposit is cured) and the denominator of which shall be
         365, and applying the rate obtained against the aggregate liquidation
         preference of the outstanding shares of such series of APS and (B) if
         such Failure to Deposit consisted of the failure timely to pay to the
         Auction Agent the Optional Redemption Price or Mandatory Redemption
         Price, as the case may be, of the shares of such series of APS, if
         any, for which Notice of Redemption


                                       15
<PAGE>





         has been given by the Fund pursuant to paragraph (b) of Section 3 of
         Part I of the APS Provisions, an amount computed by multiplying (x)
         200% of the "AA" Composite Commercial Paper Rate for the Rate Period
         during which such Failure to Deposit occurs on the redemption date by
         (y) a fraction, the numerator of which shall be the number of days for
         which such Failure to Deposit was not cured in accordance with the next
         succeeding sentence (including the day such Failure to Deposit occurs
         and excluding the day such Failure to Deposit was cured) and the
         denominator of which shall be 365, and applying the rate obtained
         against the aggregate liquidation preference of the outstanding shares
         of such series of APS to be redeemed,

then the Auction Agent shall deliver a notice in the form of Exhibit I hereto by
first-class mail, postage prepaid, to the Broker-Dealers for such series not
later than one Business Day after its receipt of the payment from the Fund
curing such Failure to Deposit and such late charge. A Failure to Deposit with
respect to any series of APS shall have been cured (if such Failure to Deposit
is not solely due to the willful failure of the Fund to make the required
payment to the Auction Agent) with respect to any Rate Period thereof if, not
later than 12:00 Noon, New York City time, on the fourth Business Day preceding
the Auction Date for the Rate Period subsequent to such Rate Period, the Fund
shall have paid to the Auction Agent (A) all accumulated and unpaid dividends on
the shares of such series of APS and (B) without duplication, the Optional
Redemption Price or Mandatory Redemption Price, as the case may be, for the
shares of such series of APS, if any, for which Notice of Redemption has been
given by the Fund pursuant to paragraph (b) of Section 3 of Part I of the APS
Provisions.

                           (b) If:

                                    (i) any Failure to Deposit shall have
                  occurred with respect to shares of any series of APS during a
                  Rate Period thereof (other than any Special Dividend Period
                  consisting of four or more Dividend Periods or any Rate
                  Period succeeding any Special Dividend Period consisting of
                  four or more Dividend


                                       16
<PAGE>





                  periods during which a Failure to Deposit occurred that has
                  not been cured), and, prior to 12:00 Noon on the third
                  Business Day next succeeding the date on which such Failure
                  to Deposit occurred, such Failure to Deposit shall not have
                  been cured within the meaning of the last sentence of Section
                  2.7(a) hereof and the Fund shall not have paid to the Auction
                  Agent the late charge described in such Section 2.7(a), but
                  such Failure to Deposit shall subsequently be so cured; or

                                    (ii) any Failure to Deposit shall have
                  occurred with respect to shares of any series of APS during a
                  Special Dividend Period consisting of four or more Dividend
                  Periods, or during any Rate Period succeeding any Special
                  Dividend Period consisting of four or more Dividend Periods
                  during which a Failure to Deposit occurred, and such Failure
                  to Deposit shall subsequently have been cured within the
                  meaning of the last sentence of Section 2.7(a) hereof,

then the Auction Agent shall deliver a notice in the form of Exhibit J hereto to
the Broker-Dealers for such series not later than one Business Day after the
receipt of the payment from the Fund during such Failure to Deposit.
Notwithstanding the foregoing, the Auction Agent shall conduct an Auction on an
Auction Date which occurs simultaneously with the date of commencement of a
Failure to Deposit.

         2.8 Broker-Dealers. (a) Not later than 12:00 Noon on each Auction Date
for any series of APS, the Fund shall pay to the Auction Agent an amount in cash
equal to the aggregate fees payable to the Broker-Dealers for such series
pursuant to Section 2.8 of the Broker-Dealer Agreements for such series. The
Auction Agent shall apply such moneys as set forth in Section 2.8 of each such
Broker-Dealer Agreement.

                  (b) The Fund shall obtain the consent of the Auction Agent
prior to selecting any Person to act as a Broker-Dealer, which consent shall not
be unreasonably withheld.


                                       17
<PAGE>





                  (c) The Auction Agent shall terminate any Broker-Dealer
Agreement as set forth therein if so directed by the Fund, provided that at
least one Broker-Dealer Agreement would be in effect for each series of APS
after such termination.

                  (d) Subject to the Auction Agent's having consented to the
selection of the relevant Broker-Dealer pursuant to Section 2.8(b) hereof, the
Auction Agent shall from time to time enter into such Broker-Dealer Agreements
with one or more Broker-Dealers as the Fund shall request, and shall enter into
such schedules to any such Broker-Dealer Agreements as the Fund shall request,
which schedules, among other things, shall set forth the series of APS to which
such Broker-Dealer Agreement relates.

         2.9 Ownership of Shares of APS. The Fund shall notify the Auction Agent
if the Fund or any affiliate of the Fund acquires any shares of APS of any
series. Neither the Fund nor any affiliate of the Fund shall submit any Order in
any Auction for APS, except as set forth in the next sentence. Any Broker-Dealer
that is an affiliate of the Fund may submit Orders in Auctions, but only if such
Orders are not for its own account. For purposes of this Section 2.9, a
Broker-Dealer shall not be deemed to be an affiliate of the Fund solely because
one or more of the directors or executive officers of such Broker-Dealer or of
any Person controlled by, in control of or under common control with such
Broker-Dealer is also a trustee of the Fund. The Auction Agent shall have no
duty or liability with respect to enforcement of this Section 2.9.

         2.10 Access to and Maintenance of Auction Records. The Auction Agent
shall, upon the receipt of prior written notice from the Fund, afford to the
Fund access at reasonable times during normal business hours to all books,
records, documents and other information concerning the conduct and results of
Auctions. The Auction Agent shall maintain records relating to any Auction for a
period of six years after such Auction, and such records shall, in reasonable
detail, accurately and fairly reflect the actions taken by the Auction Agent
hereunder.

                                       18

<PAGE>





         2.11 Dividend and Redemption Price Deposit. The Fund shall pay to the
Auction Agent, not later than 12:00 noon, New York City time, (A) on the
Business Day next preceding any Dividend Payment Date for such series, in funds
available on such Dividend Payment Date in The City of New York, New York, the
full amount of any dividend (whether or not earned or declared) to be paid on
such Dividend Payment Date on any share of such series (B) on the Business Day
next preceding any redemption date in funds available on such redemption date
for such series in The City of New York, New York, the Redemption Price to be
paid on such redemption date for any share of such series after notice of
redemption is given as set forth in the Certificate of Vote.

3. The Auction Agent as Dividend and
      Redemption Price Disbursing Agent.


         The Auction Agent, as dividend and redemption price disbursing agent,
shall pay to the Holders of shares of APS of any series (i) on each Dividend
Payment Date for such series, dividends on the shares of APS of such series,
(ii) on any date fixed for redemption of shares of APS of any series, the
Redemption Price of any shares of such series called for redemption and (iii)
any late charge related to any payment of dividends or Redemption Price, in
each case after receipt of the necessary funds from the Fund with which to pay
such dividends, Redemption Price or late charge. The amount of dividends for
any Rate Period for any series of APS to be paid by the Auction Agent to the
Holders of such shares of such series will be determined by the Fund as set
forth in Section 2 of Part I of the APS Provisions with respect to such series.
The Redemption Price of any shares to be paid by the Auction Agent to the
Holders will be determined by the Fund as set forth in Section 3 of Part I of
the APS Provisions with respect to such series. The Fund shall notify the
Auction Agent in writing of a decision to redeem shares of any series of APS at
least five days prior to the date a notice of redemption is required to be
mailed to the Holders of the shares to be redeemed by paragraph (b) of Section 3
of Part I of the APS Provisions. Such notice by the Fund to the Auction Agent
shall contain the information required by paragraph (b) of Section 3 of Part I
of the APS Provisions to be stated in the notice of redemption required to be
mailed by the Fund to such Holders.

                                       19

<PAGE>





4. The Auction Agent as Transfer Agent and Registrar.

         4.1 Issue of Share Certificates. Upon the Date of Original Issue of
each series of APS, one certificate representing all of the shares of such
series issued on such date shall be issued by the Fund and, at the request of
the Fund, registered in the name of Cede & Co. and Countersigned by the Auction
Agent.

         4.2 Registration of Transfer of Shares. Shares of each series of APS
shall be registered solely in the name of the Securities Depository or its
nominee.

         4.3 Removal of Legend on Restricted Shares. All requests for removal of
legends on shares of any series of APS indicating restrictions on transfer shall
be accompanied by an opinion of counsel stating that such legends may be removed
and such shares freely transferred, such opinion to be delivered under cover of
a letter from a Fund Officer authorizing the Auction Agent to remove the legend
on the basis of said opinion.

         4.4 Lost Share Certificates. The Auction Agent shall issue and register
replacement certificates for certificates represented to have been lost, stolen
or destroyed upon the fulfillment of such requirements as shall be deemed
appropriate by the Fund and the Auction Agent, subject at all times to
provisions of law, the By-Laws of the Fund governing such matters and
resolutions adopted by the Fund with respect to lost securities. The Auction
Agent may issue new certificates in exchange for and upon the cancellation of
mutilated certificates. Any request by the Fund to the Auction Agent to issue a
replacement or new certificate pursuant to this Section 4.4 shall be deemed to
be a representation and warranty by the Fund to the Auction Agent that such
issuance will comply with such provisions of law and the By-Laws and resolutions
of the Fund.

         4.5 Disposition of Cancelled Certificates; Record Retention. The
Auction Agent shall retain all share certificates which have been cancelled in
transfer or exchange and all accompanying documentation in accordance with
applicable rules and regulations of the Securities and Exchange Commission for
two calendar years. Upon the expiration of this two-year period, the Auction
Agent shall deliver to the Fund the cancelled certificates and accompanying
documentation. The Fund also


                                       20
<PAGE>





shall undertake to furnish to the Securities and Exchange Commission and to the
Board of Governors of the Federal Reserve System, upon demand, at either the
principal office or at any regional office, complete, correct and current hard
copies of any and all such records. There-after such records shall not be
destroyed by the Fund without the concurrence of the Auction Agent.

         4.6 Share Transfer Books. For so long as the Auction Agent, Bankers
Trust Company is acting as the transfer agent for any series of APS pursuant to
this Agreement, it shall maintain a share transfer book containing a list of
the Holders of the shares of each series of APS, the number of shares of each
series held by such Holders and the address of each Holder. The Auction Agent
shall record in such share transfer books any change of address of a Holder upon
notice by such Holder. In case of any request or demand for the inspection of
the share transfer books of the Fund or any other books in the possession of the
Auction Agent, the Auction Agent will notify the Fund and secure instructions as
to permitting or refusing such inspection. The Auction Agent reserves the
right, however, to exhibit the share transfer books or other books to any
Person in case it is advised by its counsel that its failure to do so would be
unlawful.

         4.7 Return of Funds. Any funds deposited with the Auction Agent
hereunder by the Fund for any reason, including but not limited to redemption of
shares of APS of any series, that remain unpaid after ninety days shall be
repaid to the Fund upon the written request of the Fund, together with interest,
if any, earned thereon.

5. Representations and Warranties of the Fund.

         The Fund represents and warrants to the Auction Agent that:

                  (a) the Fund has been duly organized and is subsisting as a
voluntary association with transferable shares (commonly referred to as a
business trust) under the laws of The Commonwealth of Massachusetts and has all
necessary power and authority to execute and deliver this Agreement and to
authorize, create and issue the shares of each series of APS;

                                       21

<PAGE>





                  (b) this Agreement has been duly and validly authorized,
executed and delivered by the Fund and, assuming due authorization, execution
and delivery by the Auction Agent, constitutes the legal, valid and binding
obligation of the Fund subject, as to enforceability, to bankruptcy,
insolvency, reorganization, moratorium, receivership or similar laws, whether
statutory or decisional, relating to or affecting creditors' rights and to
general equitable principles (regardless of whether enforcement is sought in
equity or at law);

                  (c) the form of the certificate evidencing the shares of APS
complies with all applicable laws of The Commonwealth of Massachusetts;

                  (d) the shares of APS, when issued, delivered and paid for on
the Date of Original Issue as contemplated by the Underwriting Agreement, will
have been duly authorized, validly issued, fully paid and nonassessable, except
as provided under Massachusetts law:

                  (e) assuming the Underwriters comply with their obligations
under the Underwriting Agreement and that the purchasers of the APS comply with
their obligations in the Master Purchaser's Letter, no consent, authorization
or order of, or filing or registration with, any court, governmental agency or
official (except such as have been obtained and such as may be required under
the Securities Act of 1933, as amended, or the Investment Company Act of 1940,
as amended, or under the blue sky or state securities laws) is required in
connection with the execution and delivery of this Agreement or the issuance of
the shares of the APS; and

                  (f) the issuance and sale of the APS, the execution, delivery
and performance of this Agreement, compliance by the Fund with all provisions
hereof, and the consummation of the transactions contemplated hereby or by the
Underwriting Agreement or the Broker-Dealer Agreements, will not conflict with,
constitute a breach of any of the terms or provisions of, or a default under, or
result in the creation or imposition of any material lien, charge or encumbrance
upon any of the assets of the Fund pursuant to the terms of any agreement,
indenture or instrument to which the Fund is a party or by which the Fund is
bound, or result in a violation of the Declaration of Trust, APB Provisions or
By-Laws of the Fund or


                                       22
<PAGE>
of any order, rule or regulation of any court or governmental agency having
jurisdiction over the Fund or its property which conflict, breach, default, lien
or violation, individually or in the aggregate, would have a material adverse
effect on the business, financial position or results of operations of the
Fund.

6. The Auction Agent.

         6.1 Duties and Responsibilities. (a) The Auction Agent is acting solely
as agent for the Fund hereunder and owes no fiduciary duties to any other
Person by reason of this Agreement.

                  (b) The Auction Agent undertakes to perform such duties and
only such duties as are specifically set forth in this Agreement and the
Broker-Dealer Agreements, and no implied covenants or obligations shall be read
into this Agreement against the Auction Agent.

                  (c) In the absence of bad faith or gross negligence on its
part, the Auction Agent shall not be liable for any action taken, suffered, or
omitted or for any error of judgment made by it in the performance of its duties
under this Agreement except that the Auction Agent shall be liable for any error
of judgment made in good faith if the Auction Agent shall have been grossly
negligent in ascertaining the pertinent facts.

                  (d) Any funds deposited with the Auction Agent hereunder by
the Fund for any reason, including the payment of dividends or the redemption of
shares of APS of any series, that remain with the Auction Agent after 90 days
shall be repaid to the Fund upon the written request of the Fund, together with
interest, if any, earned thereon.

         6.2 Rights of the Auction Agent. (a) The Auction Agent may rely and
shall be protected in acting or refraining from acting upon any communication
authorized hereby and upon any written instruction, notice, request, direction,
consent, report, certificate, share certificate or other instrument, paper or
document believed by it to be genuine. The Auction Agent shall not be liable
for acting upon any telephone communication authorized hereby which the Auction
Agent believes in good faith to have been given by the Fund or by any
Broker-Dealer.


                                       23
<PAGE>

The Auction Agent may record telephone communications with the Fund or with any
Broker-Dealer.

                  (b) The Auction Agent may consult with counsel reasonably
acceptable to the Fund and the advice of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon.

                  (c) The Auction Agent shall not be required to advance,
expend or risk its own funds or other-wise incur or become exposed to financial
liability in the performance of its duties hereunder.

                  (d) The Auction Agent may perform its duties and exercise its
rights hereunder either directly or by or through agents or attorneys and shall
not be responsible for any misconduct on the part of any agent or attorney
appointed by it with due care hereunder except as set forth above in Section
6.1(c).

         6.3 Auction Agent's Disclaimer. The Auction Agent makes no
representation as to the validity or adequacy of this Agreement (except as to
the Auction Agent's duties hereunder and as to the due authorization, execution
and delivery of this Agreement), the Broker-Dealer Agreements (except as to the
Auction Agent's duties thereunder) or the shares of any series of APS.

         6.4 Compensation, Expenses and Indemnification. (a) The Fund shall pay
the Auction Agent from time to time reasonable compensation for all services
rendered by it under this Agreement and the Broker-Dealer Agreements in such
amounts as may be agreed to by the Fund and the Auction Agent from time to time.

                  (b) The Fund shall reimburse the Auction Agent upon its
request for all reasonable expenses, disbursements and advances incurred or
made by the Auction Agent in accordance with any provision of this Agreement and
the Broker-Dealer Agreements (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except any expense or
disbursement attributable to its gross negligence or bad faith.

                                       24

<PAGE>





                  (c) The Fund shall indemnify the Auction Agent for and hold it
harmless against, any loss, liability or expense incurred without gross
negligence or bad faith on its part, arising out of or in connection with its
agency under this Agreement and the Broker-Dealer Agreements, including the
costs and expenses of defending itself against any claim or liability in
connection with its exercise or performance of its duties hereunder and
thereunder for which indemnification is provided by this subsection.

7. Miscellaneous.

         7.1 Term of Agreement. (a) The term of this Agreement is unlimited
unless it shall be terminated as provided in this Section 7.1. The Fund may
terminate this Agreement any time by so notifying the Auction Agent in writing,
provided that the Fund has entered into an agreement in substantially the form
of this Agreement with a successor auction agent. The Auction Agent may
terminate this Agreement upon written notice to the Fund, such termination to be
effective on the earlier of (i) the date specified in such notice which shall
not be earlier than 90 days after the giving of such notice or (ii) the date on
which a successor trust company is appointed by the Fund pursuant to an
agreement containing substantially the same terms and conditions as this
Agreement.

                  (b) Except as otherwise provided in this paragraph (b), the
respective rights and duties of the Fund and the Auction Agent under this
Agreement shall cease upon termination of this Agreement. The Fund's obligations
under Section 6.4 hereof and its representations and warranties contained in
Section 5 hereof and the Auction Agent's obligations and liabilities under
Sections 2.10 and 4.5 hereof shall survive the termination hereof. Upon
termination of this Agreement, the Auction Agent shall, at the Fund's request,
promptly deliver to the Fund copies of all books and records maintained by it
in connection with its duties hereunder.

         7.2 Communications. Except for (a) communications authorized to be by
telephone pursuant to this Agreement or the Auction Procedures and (b)
communications in connection with Auctions (other than those expressly
required to be in writing) and unless otherwise specified by the terms of this
Agreement all notices,


                                       25
<PAGE>





requests and other communications to any party hereunder shall be in writing
(including telecopy or similar writ- ing) given to such person at its address or
telecopy number set forth below:

If to the Company,                         Van Kampen Merritt
addressed:                                   Municipal Trust
                                           One Parkview Plaza
                                           Oakbrook Terrace, Illinois 60181

                                           Attention: Treasurer

                                           Telephone No.:   (708) 684-6000

                                           With a copy sent to:

                                           Dennis McDonnell
                                           One Parkview Plaza
                                           Oakbrook Terrace, Illinois 60181

                                           Telephone No.:   (708) 684-6330
                                           Telecopier No.:  (708) 684-5967

If to the Auction                          Bankers Trust Company
Agent, addressed:                          Corporate Trust and Agency Group
                                           Four Albany Street
                                           New York, New York 10006

                                           Attention:  Auction Rate Securities

                                           Telecopier No.:  (212) 250-6215
                                           Telephone No.:   (212) 250-6850

or to such other address as the party to whom the communication is addressed
shall have previously communicated to the other party. Communications shall be
given on behalf of the Fund by a Fund Officer and on behalf of the Auction Agent
by an Authorized Officer. Communications shall be effective when received at the
proper address.

         7.3 Entire Agreement. This Agreement contains the entire agreement
among the parties relating to the subject matter hereof, and there are no other
representations, endorsements, promises, agreements or understandings, oral,
written or inferred, between the parties.

                                       26

<PAGE>





         7.4 Benefits. Nothing herein, express or implied, shall give to any
Person, other than the Fund, the Auction Agent and their respective successors
and assigns, any benefit of any legal or equitable right, remedy or claim
hereunder.

         7.5 Amendment; Waiver. (a) This Agreement shall not be deemed or
construed to be modified, amended, rescinded, cancelled or waived, in whole or
in part, except by a written instrument signed by a duly authorized
representative of the party to be charged. The Fund shall notify the Auction
Agent and each Broker-Dealer of any change in the Fund's Declaration of Trust,
as amended and restated as of the date hereof, prior to the effective date of
any such change.

                  (b) Failure of either party hereto to exercise any right or
remedy hereunder in the event of a breach hereof by the other party shall not
constitute a waiver of any such rights or remedies with respect to any
subsequent breach.

         7.6 Successors and Assigns. This Agreement shall be binding upon, inure
to the benefit of, and be enforceable by, the respective successors of each of
the Fund and the Auction Agent.

         7.7 Limitation of Liability. Pursuant to the provisions of Article V,
Section 5.5 of the Fund's Declaration of Trust, as amended or restated as of
the date hereof, this Agreement is entered into by the trustees of the Fund not
individually, but as trustees under such Declaration of Trust and the
obligations of the Fund hereunder are not binding upon any such trustees or
shareholders of the Fund, individually, but bind only the trust estate.

         7.8 Severability. If any clause, provision or section hereof shall be
ruled invalid or unenforceable by any court of competent jurisdiction, the
invalidity or unenforceability of such clause, provision or section shall not
affect any of the remaining clauses, provisions or sections hereof.

         7.9 Execution in Counterparts. This Agreement may be executed in
several counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.

                                       27
<PAGE>





         7.10 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.




                                       28
<PAGE>





                  IN WITNESS WHEREOF, the parties hereto have caused this
Auction Agency Agreement to be duly executed and delivered by their proper and
duly authorized officers as of the date first above written.


                                         VAN KAMPEN MERRITT
                                           MUNICIPAL TRUST


                                         By /s/ Dennis J. McDonnell
                                           ------------------------
                                           Name:   Dennis J. McDonnell
                                           Title:  President


                                         BANKERS TRUST COMPANY


                                         By /s/ Anne Hartnett
                                           ---------------------------------
                                            Name:   Anne Hartnett
                                            Title:  Assistant Treasurer


<PAGE>





                                                                       EXHIBIT A







                                     FORM OF
                             BROKER-DEALER AGREEMENT



<PAGE>





                                                                       EXHIBIT B







                                     FORM OF
                            MASTER PURCHASER'S LETTER



<PAGE>





                                                                       EXHIBIT C







                              SETTLEMENT PROCEDURES



<PAGE>





                                                                       EXHIBIT D







                             FORM OF APS PROVISIONS



<PAGE>

                                                                       EXHIBIT E







                       VAN KAMPEN MERRITT MUNICIPAL TRUST

                           NOTICE OF AUCTION DATE FOR

                            AUCTION PREFERRED SHARES

                                     ("APS")


                  NOTICE IS HEREBY GIVEN that the Auction Date of the next
Auction for the APS Series __ of VAN KAMPEN MERRITT MUNICIPAL TRUST (the "Fund")
is scheduled to be __  and the next Dividend Payment Date for the Fund's APS
Series __  will be __.

                  [A Failure to Deposit in respect of the APS Series __
currently exists. If such Failure to Deposit is not cured prior to 12:00 Noon on
the fourth Business Day prior to the next scheduled Auction Date of the APS
Series __ as defined, the next Auction will not be held. Notice of the next
Auction for the APS Series ___ will be delivered when such Failure to Deposit is
cured.(1)


                                                     VAN KAMPEN MERRITT
                                                       MUNICIPAL TRUST



- --------
(1)      Include this language if a Failure to Deposit exists.

<PAGE>





                                                                       EXHIBIT F







                       VAN KAMPEN MERRITT MUNICIPAL TRUST

                          NOTICE OF PROPOSED CHANGE OF

                            LENGTH OF RATE PERIOD OF

                             ACTION PREFERRED SHARES

                                     ("APS")


                  NOTICE IS HEREBY GIVEN that VAN KAMPEN MERRITT MUNICIPAL TRUST
(the "Fund") may exercise its option to designate the Rate Period of its APS
Series ___ commencing [the first day of the proposed Special Dividend Period]
as a Special Dividend Period.

                  By 11:00 A.M. on the second Business Day next preceding the
first day of such proposed Special Dividend Period, the Fund will notify Bankers
Trust Company of either (a) its determination to exercise such option,
designating the length of such Special Dividend Period and the terms of the
Specific Redemption Provisions, if any, for such series or (b) its determination
not to exercise such option.


                                                     VAN KAMPEN MERRITT
                                                       MUNICIPAL TRUST



Dated:
      ---------------------


<PAGE>

                                                                       EXHIBIT G


                       VAN KAMPEN MERRITT MUNICIPAL TRUST

                  NOTICE OF CHANGE OF LENGTH OF RATE PERIOD OF

                            AUCTION PREFERRED SHARES

                                     ("APS")


                  NOTICE IS HEREBY GIVEN that VAN KAMPEN MERRITT MUNICIPAL TRUST
(the "Fund") has determined to designate the Rate Period of its APS Series __
commencing on [the first day of the Special Dividend Period] as a Special
Dividend Period.

                  The Special Dividend Period will be __ [days] [year[s]].

                  The Auction Date for the Special Dividend Period is (the
Business Day next preceding the first day of such Special Dividend Period).

                  [Specific Redemption Provisions, if applicable.]

                  As a result of the Special Dividend Period designation, the
amount of dividends payable on APS Series __ during the Special Dividend Period
will be based on a 360-day year.

                  The Special Dividend Period shall not commence if (a) on such
Auction Date Sufficient Clearing Bids shall not exist or (b) if a Failure to
Deposit shall have occurred prior to the first day thereof with respect to
shares of such series of APS.

                  The scheduled Dividend Payment Dates for such series of APS
during such Special Dividend Period will be ___________________________.

                                                     VAN KAMPEN MERRITT
                                                       MUNICIPAL TRUST


Dated:
      ---------------------


<PAGE>





                                                                       EXHIBIT H







                       VAN KAMPEN MERRITT MUNICIPAL TRUST

                      NOTICE OF DETERMINATION NOT TO CHANGE

                            LENGTH OF RATE PERIOD OF

                            AUCTION PREFERRED SHARES

                                     ("APS")


                  NOTICE IS HEREBY GIVEN that VAN KAMPEN MERRITT MUNICIPAL TRUST
(the "Fund") has determined not to exercise its option to designate a Special
Dividend Period of its APS Series __ and the next succeeding Dividend Period of
such series will be a Minimum Rate Period of __ days.


                               VAN KAMPEN MERRITT
                                 MUNICIPAL TRUST


Dated:
      ---------------------


<PAGE>





                                                                       EXHIBIT I







                       VAN KAMPEN MERRITT MUNICIPAL TRUST

                                NOTICE OF CURE OF

                              FAILURE TO DEPOSIT ON

                            AUCTION PREFERRED SHARES

                                     ("APS")


                  NOTICE IS HEREBY GIVEN that VAN KAMPEN MERRITT MUNICIPAL TRUST
(the "Fund") has cured its Failure to Deposit with respect to its APS Series __.
The dividend rate on the shares of APS Series __ for the current Dividend
Period is __% per annum, the Dividend Payment Date for the current Dividend
Period is scheduled to be __ and the next Auction Date is scheduled to be
__________________.

                               VAN KAMPEN MERRITT
                                 MUNICIPAL TRUST


Dated:
      ---------------------


<PAGE>





                                                                       EXHIBIT J


                       VAN KAMPEN MERRITT MUNICIPAL TRUST

                          NOTICE OF SUBSEQUENT CURE OF

                              FAILURE TO DEPOSIT ON

                            AUCTION PREFERRED SHARES

                                     ("APS")


                  NOTICE IS HEREBY GIVEN that VAN KAMPEN MERRITT MUNICIPAL TRUST
(the "Fund") has cured its Failure to Deposit with respect to its APS Series __.
The next Auction Date for the APS Series __ is scheduled to be on _____________.

                               VAN KAMPEN MERRITT
                                 MUNICIPAL TRUST


Dated:
      ---------------------


<PAGE>





                                                                       EXHIBIT K


                       VAN KAMPEN MERRITT MUNICIPAL TRUST

                                    NOTICE OF

                [CAPITAL GAINS] [AND] [TAXABLE ORDINARY INCOME](1)

                                  DIVIDEND FOR

                            AUCTION PREFERRED SHARES

                                     ("APS")


                  NOTICE IS HEREBY GIVEN that the amount of the dividend payable
on ______________ for the APS Series __ of VAN KAMPEN MERRITT MUNICIPAL TRUST
(the "Fund") will be determined by the Auction to be held on . Up to [$__A__](2)
[$__B__](3) per share of the dividend payable on such date as determined by
such Auction will consist of [capital gains](2) [ordinary income taxable for
federal income tax purposes].(3) If the dividend amount payable on such date as
determined by such Auction is less than [$__A__]2 [$__B__](3) per share, the
entire amount of the dividend will consist of [capital gains](2)

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

(1)      Include language with respect to capital gains, taxable ordinary income
         or both, depending on the character of the designation to be made with
         respect to the dividend(s).

(2)      Include bracketed material if a portion of the dividend will be
         designated capital gains.

(3)      Include bracketed material if a portion of the dividend will be
         designated ordinary income taxable for Federal income tax purposes and
         no portion of the dividend will be designated capital gains.

<PAGE>





[ordinary income taxable for federal income tax purposes](3). [To the extent
such dividend amount exceeds [$__A__] per share, any excess up to [$__B__] per
share will consist of ordinary income taxable for Federal income tax
purposes].(4) Accordingly, the aforementioned composition of the dividend
payable on ___________________________ should be considered in determining
Orders to be submitted with respect to the Auction to be held on
_____________________ . The Applicable Percentage in effect for such Auction
will be __%.



                               VAN KAMPEN MERRITT
                                 MUNICIPAL TRUST



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

(4)      Include bracketed material if a portion of the dividend will be
         designated capital gains and a portion will be designated ordinary
         income taxable for Federal income tax purposes.

         A   =    the maximum amount of capital gains allocated to such series
                  of APS to be included in such dividend, divided by the number
                  of shares of APS.

         B   =    the maximum amount of ordinary income taxable for Federal
                  income tax purposes allocated to such series of APS to be
                  included in such dividend, divided by the number of shares in
                  such series.


                                       2
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(13)(C)
<SEQUENCE>15
<FILENAME>c93084a1exv99wx13yxcy.txt
<DESCRIPTION>FORM OF BROKER-DEALER AGREEMENT
<TEXT>
<PAGE>

                                                                   EXHIBIT 13(c)








    ------------------------------------------------------------------------
                                     FORM OF

                             BROKER-DEALER AGREEMENT

                                     Between

                              BANKERS TRUST COMPANY

                                       and

                                    [       ]

                                 Dated as of [       ]

                                   Relating to

                            AUCTION PREFERRED SHARES

                                       of

                                 VAN KAMPEN [       ]
    ------------------------------------------------------------------------


<PAGE>


         BROKER-DEALER AGREEMENT dated as of [     ] between BANKERS TRUST
COMPANY (the "Auction Agent"), a New York banking corporation (not in its
individual capacity but solely as agent of Van Kampen [     ] (the "Fund")
pursuant to authority granted it in the Auction Agency Agreement, and [     ]
(together with its successors and assigns, ("BD").

         The Fund has issued in four series of shares of Auction Preferred
Shares, par value $.01 per share, liquidation preference $[ ] per share (the
"APS") pursuant to its Declaration of Trust, as amended by the Certificate of
Vote (the "Certificate").

         The Certificate will provide that, for each Subsequent Dividend Period
of any series of APS then outstanding, the Applicable Rate for such series for
such Subsequent Dividend Period shall, under certain conditions, be the rate per
annum that a bank or trust company appointed by the Fund advises results from
implementation of the Auction Procedures for such series. The Board of Trustees
has adopted a resolution appointing Bankers Trust Company as Auction Agent for
purposes of the Auction Procedures for each series of APS.

         The Auction Procedures require the participation of one or more
Broker-Dealers for each series of APS.

         NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein the Auction Agent and BD agree as follows:

1.       Definitions and Rules of Construction.

         1.1 Terms Defined by Reference to Statement.

         Capitalized terms not defined herein shall have the respective meanings
specified in the Certificate.

         1.2 Terms Defined Herein.


         As used herein and in the Settlement Procedures, the following terms
shall have the following meanings, unless the context otherwise requires:

             (a) "Auction" shall have the meaning specified in Section 2.1
hereof.

             (b) "Auction Agency Agreement" shall mean the Auction Agency
Agreement, dated as of [     ], between the fund and the Auction Agent
relating to the APS.

             (c) "Auction Procedures" shall mean the auction procedures
constituting Part II of the Certificate.


<PAGE>




              (d) "Authorized officer" shall mean each Senior Vice President,
Vice President, Assistant Vice President, Trust Officer, Assistant Treasurer and
Assistant Secretary of the Auction Agent assigned to its Corporate Trust and
Agency Group and every other officer or employee of the Auction Agent designated
as an "Authorized Officer" for purposes of this Agreement in a communication to
BD.

              (e) "BD Officer" shall mean each officer or employee of BD
designated as a "BD Officer" for purposes of this Agreement in a communication
to the Auction Agent.

              (f) "Broker-Dealer Agreement" shall mean this Agreement and any
substantially similar agreement between the Auction Agent and a Broker-Dealer.

              (g) "Certificate" shall mean the Certificate of Vote of Trustees
Establishing [ ] Series of Preferred Shares authorizing the issuance of APS
filed by the Fund with the office of the Secretary of The Commonwealth of
Massachusetts.

              (h) "Master Purchaser's Letter" shall mean a letter addressed to
the Fund, the Auction Agent, a Broker-Dealer and an Agent Member, substantially
in the form attached hereto as Exhibit A.

              (i) "Settlement Procedures" shall mean the Settlement Procedures
attached hereto as Exhibit B.

         1.3 Rules of Construction.

              Unless the context or use indicates another or different meaning
or intent, the following rules shall apply to the construction of this
Agreement:

             (a) Words importing the singular number shall include the plural
number and vice versa.

             (b) The captions and headings herein are solely for convenience of
reference and shall not constitute a part of this Agreement nor shall they
affect its meaning, construction or effect.

            (c) The words "hereof", "herein", "hereto", and other words of
similar import refer to this Agreement as a whole.

             (d) All references herein to a particular time of day shall be to
New York City time.

2.  The Auction.

         2.1 Purpose; Incorporation by Reference of Auction Procedures and
Settlement Procedures.


                                       3


<PAGE>


             (a) The provisions of the Auction Procedures will be followed by
the Auction Agent for the purpose of determining the Applicable Rate for any
Subsequent Dividend Period of any series of APS for which the Applicable Rate is
to be determined by an Auction. Each periodic operation of such procedures is
hereinafter referred to as an "Auction."

             (b) All of the provisions contained in the Auction Procedures and
the Settlement Procedures are incorporated herein by reference in their entirety
and shall be deemed to be a part hereof to the same extent as if such provisions
were fully set forth herein.

             (c) BD agrees to act as, and assumes the obligations of, and
limitations and restrictions placed upon, a Broker-Dealer under this Agreement
for each series of APS. BD understands that other Persons meeting the
requirements specified in the definition of "Broker-Dealer" contained in the
Auction Procedures may execute Broker-Dealer Agreements and Master Purchaser's
Letters and participate as Broker-Dealers in Auctions.

         2.2 Preparation for Each Auction.


             (a) Not later than [ ] A.M. on each Auction Date for the APS, the
Auction Agent shall advise the Broker-Dealers for such series by telephone of
the Maximum Rate therefor and the "AA" Composite Commercial Paper Rate(s) and
Treasury Rate(s), as the case may be, used in determining such Maximum Rate.

             (b) In the event that any Auction Date for the APS shall be changed
after the Auction Agent has given the notice referred to in clause (vi) of
paragraph (a) of the Settlement Procedures, or after the notice referred to in
Section 2.5(a) hereof, if applicable, the Auction Agent, by such means as the
Auction Agent deems practicable, shall give notice of such change to BD not
later than the earlier of [ ] A.M. on the new Auction Date or [ ] A.M. on the
old Auction Date.

             (c) The Auction Agent from time to time may request the
Broker-Dealers to provide the Auction Agent with a list of their respective
customers that such Broker-Dealers believe are Existing Holders of shares of
APS. BD shall comply with any such request, and the Auction Agent shall keep
confidential any such information so provided by BD and shall not disclose any
information so provided by BD to any Person other than the Fund and BD.

             (d) BD agrees to maintain a list of Potential Holders and to use
its best efforts to contact the Potential Holders on such list whom BD believes
may be interested in participating in such Auction on each Auction Date for the
purposes set forth in the Auction Procedures.

             (e) The Auction Agent is not required to accept the Master
Purchaser's Letter of any Potential Holder who wishes to submit a Bid for the
first time in an Auction or of any Potential Holder or Existing Holder who
wishes to amend its Master

                                       4

<PAGE>


Purchaser's Letter unless such letter or amendment is received by the Auction
Agent by [     ] P.M. on the Business Day preceding such Auction.

         2.3 Auction Schedule: Method of Submission of Orders.


             (a) The Fund and the Auction Agent shall conduct Auctions for APS
in accordance with the schedule set forth below. Such schedule may be changed by
the Auction Agent with the consent of the Fund, which consent shall not be
unreasonably withheld. The Auction Agent shall give written notice of any such
change to each Broker-Dealer. Such notice shall be given prior to the close of
business on the Business Day next preceding the first Auction Date on which such
change shall be effective.

<Table>
<Caption>
                         TIME                                                  EVENT
                         ----                                                  -----

<S>                                                     <C>
By [       ] A.M.                                       Auction Agent advises the Fund and the
                                                        Broker-Dealers of the applicable Maximum Rate and
                                                        the "AA" Composite Commercial Paper Rate(s) and
                                                        Treasury Rate(s), as the case may be, used in
                                                        determining such Maximum Rate as set forth in
                                                        Section 2.2 (a) hereof.

[       ] A.M. - [       ] P.M.                         Auction Agent assembles information communicated to
                                                        it by Broker-Dealers as provided in Section 3(a) of
                                                        the Auction Procedures. Submission Deadline is
                                                        [       ] P.M.

Not earlier than [       ] P.M.                         Auction Agent makes determinations pursuant to
                                                        Section 4(a) of the Auction Procedures.

By approximately [       ] P.M.                         Auction Agent advises Fund of results of Auction as
                                                        provided in Section 4(b) of the Auction Procedures.

                                                        Submitted Bids and Submitted Sell Orders are
                                                        accepted and rejected and shares of APS allocated
                                                        as provided in Section 5 of the Auction Procedures.

                                                        Auction Agent gives notice of Auction results as
                                                        set forth in Section 2.4 (a) hereof.
</Table>


                                       5

<PAGE>


             (b) BD agrees not to sell, assign or dispose of any share of APS to
any Person who has not delivered, or on whose behalf a Broker-Dealer has not
delivered, a signed Master Purchaser's Letter to the Auction Agent.

             (c) BD shall submit Orders to the Auction Agent in writing
substantially in the form attached hereto as Exhibit C. BD shall submit a
separate Order to the Auction Agent for each Potential Holder or Existing Holder
on whose behalf BD is submitting an order and shall not net or aggregate the
orders of different Potential Holders or Existing Holders on whose behalf BD is
submitting orders.

             (d) BD shall deliver to the Auction Agent (i) a written notice in
substantially the form attached hereto as Exhibit D or transfers of shares of
APS made through BD by an Existing Holder to another Person other than pursuant
to an Auction and shall deliver or cause to be delivered the related Master
Purchaser's Letter executed by such Person if such Person has not previously so
delivered a Master Purchaser's Letter and (ii) a written notice substantially in
the form attached hereto as Exhibit E, of the failure of any shares of APS to be
transferred to or by any Person that purchased or sold shares of APS through BD
pursuant to an Auction. The Auction Agent is not required to accept any such
notice for an Auction unless it is received by the Auction Agent by [ ] P.M. on
the Business Day preceding such Auction.

             (e) BD has delivered to the Auction Agent its executed Master
Purchaser's Letter. BD and other Broker-Dealers which have delivered duly
executed Master Purchaser's Letters may submit orders in Auctions for their own
accounts unless the Fund shall have notified BD and all other Broker-Dealers
that they may no longer do so, in which case Broker-Dealers may continue to
submit Hold Orders and Sell Orders for their own accounts.

             (f) BD agrees to handle its customers' Orders in accordance with
its duties under applicable securities laws and rules.

         2.4 Notices of Auction Results.


             (a) On each Auction Date for APS, the Auction Agent shall notify BD
by telephone of the results of the Auction as set forth in paragraph (a) of the
Settlement Procedures. By approximately [ ] A.M., on the Business Day next
succeeding such Auction Date, the Auction Agent shall confirm to BD in writing
the disposition of all orders submitted by BD in such Auction.

             (b) BD shall notify each Existing Holder or Potential Holder on
whose behalf BD has submitted an Order as set forth in paragraph (b) of the
Settlement Procedures and take such other action as is required of BD pursuant
to the Settlement Procedures.

         2.5 Designation of Special Dividend Period.


             (a) If the Fund delivers to the Auction Agent a notice of the
Auction Date for APS for a Rate Period thereof that next succeeds a Rate Period
that is

                                       6

<PAGE>


not a Minimum Dividend Period in the form of Exhibit E to the Auction Agency
Agreement; the Auction Agent shall deliver such notice to BD as promptly as
practicable after its receipt of such notice from the Fund.

             (b) If the Board of Trustees proposes to designate any succeeding
Subsequent Dividend Period of any series of APS as a Special Dividend Period and
the Fund delivers to the Auction Agent a notice of such proposed Special
Dividend Period in the form of Exhibit F to the Auction Agency Agreement, the
Auction Agent shall deliver such notice to BD as promptly as practicable after
its receipt of such notice from the Fund.

             (c) If the Board of Trustees determines to designate such
succeeding Subsequent Dividend Period as a Special Dividend Period, and the Fund
delivers to the Auction Agent a notice of such special Dividend Period in the
form of Exhibit G to the Auction Agency Agreement not later than [ ] A.M. on the
second Business Day next preceding the first day of such Rate Period, the
Auction Agent shall deliver such notice to BD not later than [ ] P.M. on such
second Business Day.

             (d) If the Fund shall deliver to the Auction Agent a notice not
later than [ ] A.M. on the second Business Day next preceding the first day of
any Rate Period stating that the Fund has determined not to exercise its option
to designate such succeeding Subsequent Dividend Period as a Special Dividend
Period, in the form of Exhibit H to the Auction Agency Agreement, or shall fail
to timely deliver either such notice or a notice in the form of Exhibit G to the
Auction Agency Agreement, the Auction Agent shall deliver a notice in the form
of Exhibit H to the Auction Agency Agreement to BD not later than [ ] P.M. on
such second Business Day.

         2.6 Allocation of Taxable Income.

         If the Fund delivers to the Auction Agent a notice in the form of
Exhibit K to the Auction Agency Agreement designating all or a portion of any
dividend on shares of any series of APS to consist of net capital gains or other
income taxable for Federal income tax purposes, the Auction Agent shall deliver
such notice to BD on the Business Day following its receipt of such notice from
the Fund. On or prior to the Auction Date referred to in such notice, BD will
contact each of its customers that BD believes to be an Existing Holder of
shares of APS or a Potential Holder interested in submitting an order with
respect to the Auction to be held on such Auction Date, and BD will notify such
customer of the contents of such notice. BD will be deemed to have notified such
Existing Holders and Potential Holders if, for each such Holder, (i) it makes a
reasonable effort to contact such Holder by telephone, and (ii) upon failing to
contact such Holder by telephone it mails written notification to such Holder at
the mailing address indicated in such Holder's most recently submitted Master
Purchaser's Letter or at such other address as is indicated in the account
records of BD.

         The Auction Agent shall be required to notify BD within two
Business Days after each Auction that involves an allocation of income taxable
for Federal income

                                       7

<PAGE>


tax purposes as to the dollar amount per share of such taxable income and income
exempt from Federal income taxation included in the related dividend.

         2.7 Failure to Deposit.

             (a) If:

                (i) any Failure to Deposit shall have occurred with respect to
     shares of APS during any Rate Period thereof (other than any Special
     Dividend Period consisting of [ ] or more Dividend Periods or any Rate
     Period succeeding any Special Dividend Period consisting of [ ] or more
     Dividend Periods during which a Failure to Deposit occurred that has not
     been cured); and (ii) prior to [ ] Noon on the third Business Day next
     succeeding the date on which such Failure to Deposit occurred, such Failure
     to Deposit shall have been cured as described in Section 2.7(a) of the
     Auction Agency Agreement and the Fund shall have paid to the Auction Agent
     a late charge as described in such Section 2.7(a);

then, the Auction Agent shall deliver a notice in the form of Exhibit I to the
Auction Agency Agreement by first-class mail, postage prepaid, to BD not later
than one Business Day after its receipt of the payment from the Fund curing such
Failure to Deposit and such late charge.

             (b) If:

                     (i) any Failure to Deposit shall have occurred with respect
     to shares of any series of APS during a Rate Period thereof (other than any
     Special Dividend Period consisting of [ ] or more Dividend Periods or any
     Rate Period succeeding any Special Dividend Period consisting of [ ] or
     more Dividend Periods during which a Failure to Deposit occurred that has
     not been cured), and, prior to [ ] on the third Business Day next
     succeeding the date on which such Failure to Deposit occurred, such Failure
     to Deposit shall not have been cured as described in Section 2.7(a) of the
     Auction Agency Agreement and the Fund shall not have paid to the Auction
     Agent the late charge described in such Section 2.7(a), but such Failure to
     Deposit shall subsequently be so cured; or

                     (ii) any Failure to Deposit shall have occurred with
     respect to shares of APS during a Special Dividend Period consisting of [ ]
     or more Dividend Periods, or during any Rate Period succeeding any Special
     Dividend Period consisting of [ ] or more Dividend Periods during which a
     Failure to Deposit occurred, and such Failure to Deposit shall subsequently
     have been cured within the meaning of Section 2.7(a) of the Auction Agency
     Agreement,





                                       8



<PAGE>


then the Auction Agent shall deliver a notice in the form of Exhibit J to the
Auction Agency Agreement to the Broker-Dealers for such series not later than
one Business Day after the receipt of the payment from the Fund curing such
Failure to Deposit.

         2.8 Service Charge to be Paid to BD.


         On the Business Day next succeeding each Auction Date, the Auction
Agent shall pay to BD from moneys received from the Fund an amount equal to the
product of (a) (i) in the case of any Auction Date immediately preceding a Rate
Period of such series consisting of less than [     ] Dividend Periods, [     ]
%, or (ii) in the case of any Auction Date immediately preceding a Rate Period
of such series consisting of [     ] or more Dividend Periods, a percentage
agreed upon in writing by the Fund and the Broker-Dealers times (b) a fraction,
the numerator of which is the number of days in the Rate Period therefor
beginning on such Business Day and the denominator of which is 365 if such Rate
Period is less than one year and 360 for all other Rate Periods, times (c)
$[     ] times (d) the sum of (1) the aggregate number of shares of such series
placed by BD in such Auction that were (A) the subject of Submitted Bids of
Existing Holders submitted by BD and continued to be held as a result of such
submission and (B) the subject of Submitted Bids of Potential Holders submitted
by BD and purchased as a result of such submission plus (ii) the aggregate
number of shares of such series subject to valid Hold Orders (determined in
accordance with paragraph (d) of Section 3 of the Auction Procedures) submitted
to the Auction Agent by BD plus (iii) the number of shares of APS deemed to be
subject to Hold Orders by Existing Holders pursuant to paragraph (c) of Section
3 of the Auction Procedures that were acquired by such Existing Holders through
BD.

         For purposes of subclause (d)(iii) of the foregoing paragraph, if any
Existing Holder who acquired shares of any series of APS through BD transfers
those shares to another Person other than pursuant to an Auction, then the
Broker-Dealer for the shares so transferred shall continue to be BD; provided,
however, that if the transfer was effected by, or if the transferee is, a
Broker-Dealer other than BD, then such Broker-Dealer shall be the Broker-Dealer
for such shares.

         2.9 Settlement.

             (a) If any Existing Holder on whose behalf BD has submitted a Bid
or Sell Order for shares of APS that was accepted in whole or in part fails to
instruct its Agent Member to deliver the shares of APS subject to such Bid or
Sell Order against payment therefor, BD shall instruct such Agent Member to
deliver such shares against payment therefor and BD may deliver to the Potential
Holder on whose behalf BD submitted a Bid for shares of APS that was accepted in
whole or in part a number of shares of APS of such series that is less than the
number of shares of APS of such series specified in such Bid to be purchased by
such Potential Holder. Notwithstanding the foregoing terms of this Section, any
delivery or non-delivery of shares of APS which represents any departure from
the results of an Auction for such series, as determined by the Auction Agent,
shall be of no effect unless and until the Auction Agent shall have been
notified of such delivery or non-delivery in accordance with the terms of
Section

                                       9

<PAGE>


2.3(d)(ii) hereof. The Auction Agent shall have no duty or liability with
respect to enforcement of this Section 2.9.

             (b) Neither the Auction Agent nor the Fund shall have any
responsibility or liability with respect to the failure of an Existing Holder, a
Potential Holder or its respective Agent Member to deliver shares of APS of any
series or to pay for shares of APS of any series sold or purchased pursuant to
the Auction Procedures or otherwise.

3.  The Auction Agent.

         3.1 Duties and Responsibilities.

             (a) The Auction Agent is acting solely as agent for the Fund
hereunder and owes no fiduciary duties to any other Person, other than the Fund,
by reason of this Agreement.

             (b) The Auction Agent undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement, and no implied
covenants or obligations shall be read into this Agreement against the Auction
Agent.

             (c) In the absence of bad faith or negligence on its part, the
Auction Agent shall not be liable for any action taken, suffered, or omitted or
for any error of judgment made by it in the performance of its duties under this
Agreement. The Auction Agent shall not be liable for any error or judgment made
in good faith unless the Auction Agent shall have been negligent in ascertaining
the pertinent facts.

         3.2 Rights of the Auction Agent.

             (a) The Auction Agent may rely and shall be protected in acting or
refraining from acting upon any communication authorized hereby and upon any
written instruction, notice, request, direction, consent, report, certificate,
share certificate or other instrument, paper or document believed in good faith
by it to be genuine. The Auction Agent shall not be liable for acting upon any
telephone communication authorized by this Agreement which the Auction Agent
believes in good faith to have been given by the Fund or by a Broker-Dealer. The
Auction Agent may record telephone communications with the Broker-Dealers.

             (b) The Auction Agent may consult with counsel of its choice and
the advice of such counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon.

             (c) The Auction Agent shall not be required to advance, expend or
risk its own funds or otherwise incur or become exposed to financial liability
in the performance of its duties hereunder.

         3.3 Auction Agent's Disclaimer.


                                       10

<PAGE>



         The Auction Agent makes no representation as to the validity or
adequacy of this Agreement, the Auction Agency Agreement or the shares of APS
of any series.

4.  Miscellaneous.

         4.1 Termination.

         Either party may terminate this Agreement at any time on five days'
notice to the other party, provided that neither BD nor the Auction Agent may
terminate this Agreement without first obtaining prior written consent of the
Fund to such termination, which consent shall not be unreasonably withheld. This
Agreement shall automatically terminate upon the termination of the Auction
Agency Agreement.

         4.2 Participant in Securities Depository; Payment of Dividends in
Same-Day Funds.


             (a) BD is, and shall remain for the term of this Agreement, a
member of, or participant in, the Securities Depository (or an affiliate of such
a member or participant).

             (b) BD represents that it (or if such BD does not act as Agent
Member, one of its affiliates) shall make all dividend payments on the APS
available in same-day funds on each Dividend Payment Date to customers that use
such BD or affiliate as Agent Member.

         4.3 Communications.

         Except for (i) communications authorized to be by telephone by this
Agreement or the Auction Procedures and (ii) communications in connection with
Auctions (other than those expressly required to be in writing), all notices,
requests and other communications to any party hereunder shall be in writing
(including telecopy or similar writing) and shall be given to such party,
addressed to it, at its address or telecopy number set forth below:

<Table>
<Caption>

<S>                                                     <C>
If to BD,                                               [Attention:                  ]
addressed:
                                                        Telecopier No.: (      )
                                                        Telephone No.:  (      )

If to the Auction                                       Bankers Trust Company
Agent, addressed:                                       Corporate Trust and Agency Group
                                                        Four Albany Street
                                                        New York, New York 10006
                                                        Attention: Auction Rate/
                                                        Remarketed Securities


</TABLE>



                                       11

<PAGE>

<TABLE>


<S>                                                     <C>
                                                        Telecopier No.: (      )
                                                        Telephone No.:  (      )
</Table>



or such other address or telecopy number as such party may hereafter specify for
such purpose by notice to the other parties. Each such notice, request or
communication shall be effective when delivered at the address specified herein.
Communications shall be given on behalf of BD by a BD Officer and on behalf of
the Auction Agent by an Authorized Officer. BD may record telephone
communications with the Auction Agent.

         4.4 Entire Agreement.

         This Agreement contains the entire agreement among the parties hereto
relating to the subject matter hereof, and there are no other representations,
endorsements, promises, agreements or understandings, oral, written or implied,
among the parties hereto relating to the subject matter hereof.

         4.5 Benefits.

         Nothing in this Agreement, express or implied, shall give to
any person, other than the Fund, the Auction Agent, BD and their respective
successors and assigns, any benefit of any legal or equitable right, remedy or
claim hereunder.

         4.6 Amendment; Waiver.

             (a) This Agreement shall not be deemed or construed to be modified,
amended, rescinded, cancelled or waived, in whole or in part, except by a
written instrument signed by a duly authorized representative of the party to be
charged.

             (b) Failure of any party hereto to exercise any right or remedy
hereunder in the event of a breach hereof by any other party shall not
constitute a waiver of any such right or remedy with respect to any subsequent
breach.

         4.7 Successors and Assigns.


         This Agreement shall be binding upon, inure to the benefit of, and be
enforceable by, the respective successors and assigns of each of the Auction
Agent and BD. This Agreement may not be assigned by either party hereto absent
the prior written consent of the other party; provided, however, that this
Agreement may be assigned by the Auction Agent to a successor Auction Agent
selected by the Fund without the consent of BD.

         4.8 Severability.

         If any clause, provision or section hereof shall be ruled invalid or
unenforceable by any court of competent jurisdiction, the invalidity or
unenforceability of such clause, provision or section shall not affect any of
the remaining clauses, provisions or sections hereof.


                                       12

<PAGE>


         4.9 Execution in Counterparts.


         This Agreement may be executed in several counterparts, each of which
shall be an original and all of which shall constitute but one and the same
instrument.

         4.10 Governing Law.


         This Agreement shall be governed by and construed in accordance with
the laws of the State of New York applicable to agreements made and to be
performed in said State.

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their proper and duly authorized officers as
of the date first above written.


<TABLE>

<S>                                                 <C>
                                                     [                                  ]




                                                     By
                                                        -----------------------------------------
                                                          Name:
                                                          Title:




                                                     [                                  ]




                                                     By
                                                        -----------------------------------------
                                                         Name:
                                                         Title:
</TABLE>



                                       13






</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(13)(D)(I)
<SEQUENCE>16
<FILENAME>c93084a1exv99wx13yxdyxiy.txt
<DESCRIPTION>LETTER OF REPRESENTATIONS
<TEXT>
<PAGE>
                                                                EXHIBIT 13(d)(i)






                                                     December 10, 1991





The Depository Trust Company
55 Water Street
New York, New York 10041

Attention:  General Counsel's Office

         Re:    Van Kampen Merritt Municipal Trust Auction
                Preferred Shares of Beneficial Interest ("APS")

Gentlemen:

         The purpose of this letter is to set forth certain matters relating to
the issuance and sale by Van Kampen Merritt Municipal Trust (the "Fund") of 1500
shares of each series of its preferred shares of beneficial interest, par value
$.01 per share, liquidation preference $50,000 per share, designated as Auction
Preferred Shares, Series A ("APS Series A"), Auction Preferred Shares, Series B
("APS Series B"), Auction Preferred shares, series C ("APS Series C"), and
Auction Preferred Shares, Series D ("APS Series D") (collectively, the APS
Series A, APS Series B, APS Series C and APS Series D are referred to herein as
the "APS"), pursuant to the Fund's Declaration of Trust (as defined below).
Pursuant to the auction agency agreement, dated as of December 10, 1991 (the
"Auction Agency Agreement"), between the Fund and Bankers Trust Company
("Bankers Trust"), Bankers Trust will act as the auction agent, transfer agent,
registrar and dividend and redemption price disbursing agent and agent for
certain notifications for the Fund in connection with the shares of each series
of APS (hereinafter referred to, when acting in any such capacity, as the
"Auction Agent").

         Pursuant to an underwriting agreement, dated December 5, 1991 ("AB
Underwriting Agreement"), among Goldman, Sachs & Co., Smith Barney, Harris Upham
& Co., PaineWebber Incorporated and Prudential Securities Incorporated (the
"Underwriters"), the Fund and Van Kampen Merritt Investment Advisory Corp. (the
"Adviser"), the Underwriters have agreed to purchase from the Fund, and the Fund
has agreed to issue and sell to the Underwriters, the shares of each of APS
Series A and APS Series B. Pursuant to a separate underwriting agreement, dated
December 5, 1991 ("CD Underwriting Agreement"), among the Underwriters, the Fund
and the Adviser, the Underwriters have agreed to purchase from the Fund, and the
Fund has agreed to issue and sell to the Underwriters, the shares of each of APS
Series C and APS Series D.

<PAGE>


The Depository Trust Company
December 10, 1991
Page 2

Pursuant to the requirements of the Securities Act of 1933, as amended, the Fund
has filed with the Securities and Exchange Commission a Registration Statement
on Form N-2 and a prospectus contained therein (the "Prospectus") concerning the
issuance of the APS, which includes, among other things, a description of the
role of The Depository Trust Company ("DTC") with respect to such APS. Attached
hereto is a copy of the Prospectus.

         Capitalized terms not otherwise defined herein shall have the
respective meanings set forth in the Declaration of Trust (as defined below), a
copy of which is attached hereto, unless the context otherwise requires.

         To induce DTC to accept the APS as eligible for deposit at DTC and to
act in accordance with its rules with respect to the APS, the Fund and the
Auction Agent agree with DTC as follows:

                  1. The Fund shall cause the Underwriters to deliver at the
         closings with respect to the AB Underwriting Agreement and the CD
         Underwriting Agreement, each of which is scheduled for December 10,
         1991, for deposit with DTC one share certificate with respect to each
         series of APS (each an "APS Certificate"), which certificate will
         represent the total number of shares of each respective series of APS
         issued and registered in the name of DTC's nominee, Cede & Co.
         ("Cede"), and each such APS Certificate shall remain in DTC's custody
         as provided herein.

                  2. The Fund's Declaration of Trust, as amended, including the
         Certificate of Vote (sometimes referred to herein together with the
         Fund's Declaration of Trust as the "Declaration of Trust") establishing
         the rights and preferences of the shares of each series of APS,
         provides for the solicitation of consents from and voting by Holders of
         the shares of each series of APS under certain circumstances. The Fund
         shall establish a record date for such purposes and give DTC notice of
         such record date not less than 15 calendar days in advance of such
         record date to the extent possible.

                  3. If fewer than all of the shares of any series of APS are to
         be redeemed pursuant to Part I, Section 4 of the Certificate of Vote,
         the number of shares of such series of APS to be redeemed shall be
         determined by the Board of Trustees of the Fund and the Fund shall
         notify the Auction Agent and DTC by 1:00 p.m., New York City time, (A)
         in the case of an optional redemption at least 30 days prior to the
         earliest date on which such redemption shall occur and (B) in the case
         of a mandatory redemption, if the Fund shall have received the relief
         from the Securities and Exchange Commission described in the Prospectus
         with respect to mandatory redemptions, on the second Business Day
         preceding the redemption date established by the Board of Trustees and
         specified in such notice. By the close of business on the day on which
         the Auction Agent receives a Notice of Redemption from the Fund, the
         Auction Agent will give telephonic notice to

<PAGE>

The Depository Trust Company
December 10, 1991
Page 3

         DTC, and the Auction Agent shall give DTC a hand delivered copy of such
         notice which will be marked "TIME CRITICAL" and shall include a copy
         addressed to Vice President, Reorganization Department (which call
         notice shall include the aggregate number of shares of such series of
         APS to be redeemed). Unless certificates representing the shares of
         such series of APS are held by Holders other than DTC or its nominee,
         DTC, upon receipt of a Notice of Redemption from the Auction Agent,
         will determine by lot the number of shares of such series of APS to be
         redeemed from the account of each Agent Member. DTC shall use its best
         efforts to complete such lottery and notify the Auction Agent of the
         results of such lottery by 10:00 a.m., New York City time, on the
         Business Day following the date on which DTC receives the call notice
         from the Auction Agent. DTC shall notify the Auction Agent by such time
         of each Agent Member that has credited to its DTC account shares of
         such series of APS that are selected for redemption by DTC and shall,
         using its best efforts, provide the Auction Agent with the names of the
         persons or departments at each such Agent Member to be contacted
         regarding such redemption. The Auction Agent will in turn determine by
         lot the number of shares of such series of APS to be redeemed from the
         accounts of the Existing Holders of shares of such series of APS whose
         Agent Members have been selected in sufficient time to enable the
         Auction Agent to notify the Broker-Dealer and such Existing Holders as
         provided in the Auction Agency Agreement.

                  4. The Declaration of Trust provides that the dividend rate
         for the shares of each series of APS may vary from time to time based
         upon the results of the implementation of the Auction Procedures set
         forth in Part II of the Certificate of Vote. The Auction Agent shall
         telecopy notice to Manager, Announcements, Dividends Department, The
         Depository Trust Company, at (212) 709-1264, of the Applicable Rate and
         the Dividend Payment Date with respect to the shares of each series of
         APS (the "Dividend Rate Notices") no later than the day following each
         Auction after implementation of such procedures and shall verify
         receipt by DTC of such notice by contacting the Supervisor,
         Announcements, Dividends Department, The Depository Trust Company, at
         (212) 709-1270. The Auction Agent shall make available, by telecopy,
         facsimile or other similar means, to Interactive Data Services, Inc.,
         or any other announcement service to which DTC may subscribe, the
         Applicable Rate and the Dividend Payment Date on each Auction Date
         after implementation of such procedures.

                  5. The Prospectus indicates that each purchaser of shares of
         any series of APS or its Broker-Dealer must sign a Master Purchaser's
         Letter which contains provisions restricting transfer of such APS. The
         Fund and the Auction Agent acknowledge that so long as Cede is the sole
         record owner of shares of any series of APS, it shall be entitled to
         all voting rights applicable to such APS and to receive the full amount
         of all dividends, liquidation proceeds and redemption proceeds payable
         with respect to such APS. The Fund and the Auction Agent acknowledge
         that DTC shall treat any Agent Member having shares of any series

<PAGE>


The Depository Trust Company
December 10, 1991
Page 4

         of APS credited to its DTC account as entitled to the full benefits of
         ownership of such APS even if the crediting of shares of such APS to
         the DTC accounts of such Agent Member results from transfers or
         failures to transfer in violation of the provisions of the Master
         Purchaser's Letter. Without limiting the generality of the preceding
         sentence, the Fund and the Auction Agent acknowledge that DTC shall
         treat any Agent Member having shares of any series of APS credited to
         its DTC account as entitled to receive dividends, distributions and
         voting rights, if any, in respect of such APS and, subject to section
         11 hereof, to receive certificates evidencing such APS if such
         certificates are to be issued in accordance with the Fund's Declaration
         of Trust. (The treatment by DTC of the effects of the crediting by it
         of shares of such series of APS to the accounts of Agent Members
         described in the preceding two sentences shall not affect the rights of
         the Fund, participants in Auctions relating to shares of such series of
         APS or purchasers, sellers or Holders of shares of such series of APS
         against any Agent Member.) DTC shall have no responsibility to
         ascertain that any transfer of shares of any series of APS is made in
         accordance with the provisions of the Master Purchaser's Letter.

                  6. All notices and payment advices sent to DTC shall contain
         the CUSIP number set forth in the respective APS Certificate.

                  7. Notices to DTC by facsimile transmission shall be sent to
         (212) 709-1093 or (212) 709-1094. Notices to DTC by any other means
         shall be sent to:

                  Manager, Reorganization Department
                  Reorganization Window
                  The Depository Trust Company
                  7 Hanover Square, 23rd Floor
                  New York, New York 10004

                  8. Dividend payments shall be received by Cede, as nominee of
         DTC, or its registered assigns in same-day funds on each payment date
         (or the equivalent in accordance with existing arrangements between the
         Fund or the Auction Agent and DTC). Such payments shall be made payable
         to the order of "Cede & Co." Absent any other existing arrangements
         such payments shall be addressed as follows:

                  Manager, Cash Receipts, Dividends
                  The Depository Trust Company
                  7 Hanover Square, 24th Floor
                  New York, New York 10004

                  9. Redemption payments shall be made in same-day funds by the
         Auction Agent in the manner set forth in the SDFS Paying Agent
         Operating Procedures (a copy of which previously has been furnished to
         the Auction Agent).


<PAGE>

The Depository Trust Company
December 10, 1991
Page 5

                  10. DTC may direct the Auction Agent to use any other
         telephone number for facsimile transmission, address or department of
         DTC as the number, address or department to which payments of
         dividends, redemption proceeds or notices may be sent.

                  11. In the event of a partial redemption necessitating a
         reduction in the number of outstanding shares of any series of APS,
         DTC, in its discretion, (a) may request the Fund to direct the Auction
         Agent to issue and authenticate a new APS Certificate with respect to
         the shares of the respective series of APS in exchange for surrender of
         the old APS Certificate with respect to such series or (b) shall make
         an appropriate notation on the APS Certificate with respect to such
         series indicating the date and amounts of such reduction in the
         outstanding shares of such series of APS, except in the case of a final
         redemption of shares of such series of APS in which case the APS
         Certificate with respect to such series must be surrendered to the
         Auction Agent prior to payment.

                  12. In the event that beneficial owners of shares of any
         series of APS shall be able to obtain certified shares, the Auction
         Agent may notify DTC of the availability of certificates representing
         the ownership of shares of such series of APS. In such event, the
         Auction Agent will issue, transfer and exchange APS Certificates with
         respect to such series as required by DTC and others in appropriate
         amounts.

                  13. Whenever DTC requests the Fund and the Auction Agent to do
         so, the Auction Agent and the Fund will cooperate with DTC in taking
         appropriate action to make available one or more separate certificates
         evidencing shares of any series of APS to any Agent Member having
         shares of such series of APS credited to its DTC account.

                  14. DTC may determine to discontinue providing its services as
         securities depository with respect to shares of any series of APS at
         any time by giving 90 days written notice to the Fund and the Auction
         Agent (at which time DTC will confirm with the Auction Agent the
         aggregate amount of outstanding shares of such series of APS). Under
         such circumstances, at DTC's request the Fund or the Auction Agent will
         cooperate with DTC in taking appropriate action to make available one
         or more separate certificates evidencing shares of such series of APS
         to any Agent Member having shares of such series of APS credited to its
         DTC account.

                  15. The Fund hereby authorizes DTC to provide to the Auction
         Agent position listings of its Agent Members with respect to shares of
         any series of APS from time to time at the request of the Auction
         Agent, and also authorizes DTC in the event of a partial redemption of
         shares of any series of APS to provide the Auction Agent, upon request,
         with the names of those Agent Members whose position in such APS has
         been selected for redemption by DTC. DTC agrees to


<PAGE>

The Depository Trust Company
December 10, 1991
Page 6


         use its best efforts to notify the Auction Agent of those Agent Members
         whose position in shares of such series of APS has been selected for
         redemption by DTC and to provide the Auction Agent with the names of
         the person or department at such Agent Members to contact regarding
         such redemption. The Fund authorizes the Auction Agent to provide DTC
         with such signatures, examples of signatures and authorizations to act
         as may be deemed necessary to DTC to permit DTC to discharge its
         obligations to its Agent Members and appropriate regulatory
         authorities.

                  This authorization, unless revoked by the Fund, shall continue
         with respect to shares of each series of APS while shares of each such
         series of APS are on deposit at DTC, until and unless the Auction Agent
         shall no longer be acting. In such event, the Fund shall provide DTC
         with similar evidence of authorization of any successor thereto to so
         act.

                  16. (a) The Prospectus indicates that the Fund may at any time
         designate a Special Dividend Period with respect to shares of any
         series of APS prior to the commencement of such Special Dividend
         Period. In the event of such designation, the Fund will notify DTC in
         writing at least seven days prior to the Auction Date relating to such
         Special Dividend Period of all details concerning the Special Dividend
         Period. If the new dividend for a Special Dividend Period is to be
         payable on more than one Dividend Payment Date, such notice shall state
         all such Dividend Payment Dates and payment factors associated with
         such Dividend Period. The Auction Agent shall also notify DTC of each
         upcoming Dividend Payment Date on the business day after the preceding
         Dividend Payment Date.

                      (b) The Fund will notify DTC, at least 10 business days
                  prior to the payment date for an Additional Dividend (as
                  defined in the Prospectus) in respect of shares of any series
                  of APS, of (i) the record date for Holders of shares of such
                  series of APS entitled to receive Additional Dividends, (ii)
                  the amount of Additional Dividends payable on a per share
                  basis to such Holders and (ii) the CUSIP number set forth on
                  the share certificate representing shares of such series of
                  APS.



<PAGE>


The Depository Trust Company
December 10, 1991
Page 7

         If you are in agreement with the terms of this Letter Agreement, please
execute the Letter Agreement in the space provided below.

                                        Very truly yours,

                                        VAN KAMPEN MERRITT
                                        MUNICIPAL TRUST


                                        By:/s Dennis J. McDonnell
                                           -----------------------------------
                                        Name: Dennis J. McDonnell
                                        Title: President


                                        BANKERS TRUST COMPANY
                                           as auction agent


                                        By:/s/ Anne Hartnett
                                           -----------------------------------
                                        Name: Anne Hartnett
                                        Title: Assistant Treasurer

Accepted as of the date first written above

THE DEPOSITORY TRUST COMPANY


By: /s/ Richard B. Nesson
    ---------------------------------
Name:   Richard B. Nesson
Title:

(enclosures)

cc:      Goldman, Sachs & Co.
         Smith Barney, Harris Upham & Co.
         PaineWebber Incorporated
         Prudential Securities Incorporated

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(13)(D)(II)
<SEQUENCE>17
<FILENAME>c93084a1exv99wx13yxdyxiiy.txt
<DESCRIPTION>FORM OF LETTER OF REPRESENTATIONS
<TEXT>
<PAGE>
                                                               EXHIBIT 13(d)(ii)


                          THE DEPOSITORY TRUST COMPANY
           A subsidiary of The Depository Trust & Clearing Corporation

                        ISSUER LETTER OF REPRESENTATIONS
          [To be Completed by Issuer and Co-Issuer(s), if applicable]

       ------------------------------------------------------------------
                [Name of Issuer and Co-Issuer(s), if applicable]

       ------------------------------------------------------------------
       [Security Description, including series designation if applicable]

       ------------------------------------------------------------------
                        [CUSIP Number of the Securities]

                                                          ----------------------
                                                                  [Date]

[For Municipal Issues:
   Underwriting Department--Eligibility; 25th Floor]
[For Corporate Issues:
   General Counsel's Office; 22nd Floor]
THE DEPOSITORY TRUST COMPANY
55 Water Street
New York, NY 10041-0099

Ladies and Gentlemen:

   This letter sets forth our understanding with respect to the Securities
represented by the CUSIP number referenced above (the "Securities"). Issuer
requests that The Depository Trust Company ("DTC") accept the Securities as
eligible for deposit at DTC. The DTC Participant,
                                                 ----------------------------
(manager, underwriter, or placement agent) will distribute the securities
through DTC.

   To induce DTC to accept the Securities as eligible for deposit at DTC, and to
act in accordance with DTC's Rules with respect to the Securities, Issuer
represents to DTC that Issuer will comply with the requirements applicable to it
stated in DTC's Operational Arrangements (found at WWW.DTCC.COM and
WWW.DTC.ORG), as they may be amended from time to time.

                                             Very truly yours,

Note:
- ----

Schedule A contains statements that
DTC believes accurately describe DTC,        ----------------------------------
the method of effecting book-entry                        (Issuer)
transfers of securities distributed       By:
through DTC, and certain related             ----------------------------------
matters.                                     (Authorized Officer's Signature)

Received and Accepted:                       ----------------------------------
THE DEPOSITORY TRUST COMPANY                           (Print Name)

By:
   ----------------------------------        ----------------------------------
                                                     (Street Address)


                                             ----------------------------------
                                            (City)  (State) (Country) (Zip Code)

                                             (   )
                                             ----------------------------------
                                                      (Phone Number)

                                             ----------------------------------
[DTCC THE DEPOSITORY TRUST &                          (E-mail Address)
 CLEARING CORPORATION]


<PAGE>


        Additional Signature Page to DTC Issuer Letter of Representation
                            for use with Co-Issuers


                  --------------------------------------------
                        [Name of Issuer and Co-issuer(s)]



In signing this Issuer letter of Representations dated as
of                                                        Co-Issuer
   -----------------------------, ------------------------
agrees to and shall be bound by all "Issuer" representations.




        -------------------------------------------------
                          (Co-Issuer)

By:
        -------------------------------------------------
                (Authorized Officer's Signature)


        -------------------------------------------------
                          (Print Name)


        -------------------------------------------------
                        (Street Address)


        -------------------------------------------------
        (City)        (State)    (Country)     (Zip Code)

        (   )
        -------------------------------------------------
                         (Phone Number)


        -------------------------------------------------
                        (E-mail Address)




                                                                         [03/05]


<PAGE>

                                                                     SCHEDULE  A

                                           (TO ISSUER LETTER OF REPRESENTATIONS)

                        SAMPLE OFFERING DOCUMENT LANGUAGE
                      DESCRIBING BOOK-ENTRY-ONLY ISSUANCE
                      -----------------------------------
             (PREPARED BY DTC--BRACKETED MATERIAL MAY BE APPLICABLE
                            ONLY TO CERTAIN ISSUES)

   1. The Depository Trust Company ("DTC"), New York, NY, will act as securities
depository for the securities (the "Securities"). The Securities will be issued
as fully-registered securities registered in the name of Cede & Co. (DTC's
partnership nominee) or such other name as may be requested by an authorized
representative of DTC. One fully-registered Security certificate will be issued
for [each issue of] the Securities, [each] in the aggregate principal amount of
such issue,and will be deposited with DTC. [If, however, the aggregate principal
amount of [any] issue exceeds $500 million, one certificate will be issued with
respect to each $500 million of principal amount, and an additional certificate
will be issued with respect to any remaining principal amount of such issue.]

   2. DTC, the world's largest securities depository, is a limited-purpose trust
company organized under the New York Banking Law, a "banking organization"
within the meaning of the New York Banking Law, a member of the Federal Reserve
System, a "clearing corporation" within the meaning of the New York Uniform
Commercial Code, and a "clearing agency" registered pursuant to the provisions
of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides
asset servicing for over 2.2 million issues of U.S. and non-U.S. equity issues,
corporate and municipal debt issues, and money market instruments from over 100
countries that DTC's participants ("Direct Participants") deposit with DTC. DTC
also facilitates the post-trade settlement among Direct Participants of sales
and other securities transactions in deposited securities, through electronic
computerized book-entry transfers and pledges between Direct Participants'
accounts. This eliminates the need for physical movement of securities
certificates. Direct Participants include both U.S. and non-U.S. securities
brokers and dealers, banks, trust companies, clearing corporations, and certain
other organizations. DTC is a wholly-owned subsidiary of The Depository Trust &
Clearing Corporation ("DTCC"). DTCC, in turn, is owned by a number of Direct
Participants of DTC and Members of the National Securities Clearing Corporation,
Fixed Income Clearing Corporation, and Emerging Markets Clearing Corporation
(NSCC, FICC, and EMCC, also subsidiaries of DTCC), as well as by the New York
Stock Exchange, Inc., the American Stock Exchange LLC, and the National
Association of Securities Dealers, Inc. Access to the DTC system is also
available to others such as both U.S. and non-U.S. securities brokers and
dealers, banks, trust companies, and clearing corporations that clear through or
maintain a custodial relationship with a Direct Participant, either directly or
indirectly ("Indirect Participants"). DTC has Standard & Poor's highest rating:
AAA. The DTC Rules applicable to its Participants are on file with the
Securities and Exchange Commission. More information about DTC can be found at
WWW.DTCC.COM and WWW.DTC.ORG.

   3. Purchases of Securities under the DTC system must be made by or through
Direct Participants, which will receive a credit for the Securities on DTC's
records. The ownership interest of each actual purchaser of each Security
("Beneficial Owner")is in turn to be recorded on the Direct and Indirect
Participants' records. Beneficial Owners will not receive written confirmation
from DTC of their purchase. Beneficial Owners are, however, expected to receive
written confirmations providing details of the transaction, as well as periodic
statements of their holdings, from the Direct or Indirect Participant through
which the Beneficial Owner entered into the transaction. Transfers of ownership
interests in the Securities are to be accomplished by entries made on the books
of Direct and Indirect Participants acting on behalf of Beneficial Owners.
Beneficial Owners will not receive certificates representing their ownership
interests in Securities, except in the event that use of the book-entry system
for the Securities is discontinued.

   4. To facilitate subsequent transfers, all Securities deposited by Direct
Participants with DTC are registered in the name of DTC's partnership nominee,
Cede & Co., or such other name as may be requested by an authorized
representative of DTC. The deposit of Securities with DTC and their registration
in the name of Cede & Co. or such other DTC nominee do not effect any change in
beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of
the Securities; DTC's records reflect only the identity


                                                                         [03/05]

<PAGE>



of the Direct Participants to whose accounts such Securities are credited, which
may or may not be the Beneficial Owners. The Direct and Indirect Participants
will remain responsible for keeping account of their holdings on behalf of their
customers.

   5. Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time. [Beneficial Owners of Securities may wish to
take certain steps to augment the transmission to them of notices of significant
events with respect to the Securities, such as redemptions, tenders, defaults,
and proposed amendments to the Security documents. For example, Beneficial
Owners of Securities may wish to ascertain that the nominee holding the
Securities for their benefit has agreed to obtain and transmit notices to
Beneficial Owners. In the alternative, Beneficial Owners may wish to provide
their names and addresses to the registrar and request that copies of notices be
provided directly to them.]

   [6. Redemption notices shall be sent to DTC. If less than all of the
Securities within an issue are being redeemed, DTC's practice is to determine by
lot the amount of the interest of each Direct Participant in such issue to be
redeemed.]

   7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or
vote with respect to Securities unless authorized by a Direct Participant in
accordance with DTC's Procedures. Under its usual procedures, DTC mails an
Omnibus Proxy to Issuer as soon as possible after the record date. The Omnibus
Proxy assigns Cede & Co.'s consenting or voting rights to those Direct
Participants to whose accounts Securities are credited on the record date
(identified in a listing attached to the Omnibus Proxy).

   8. Redemption proceeds, distributions, and dividend payments on the
Securities will be made to Cede & Co., or such other nominee as may be requested
by an authorized representative of DTC. DTC's practice is to credit Direct
Participants' accounts upon DTC's receipt of funds and corresponding detail
information from Issuer or Agent, on payable date in accordance with their
respective holdings shown on DTC's records. Payments by Participants to
Beneficial Owners will be governed by standing instructions and customary
practices, as is the case with securities held for the accounts of customers in
bearer form or registered in "street name," and will be the responsibility of
such Participant and not of DTC, Agent, or Issuer, subject to any statutory or
regulatory requirements as may be in effect from time to time. Payment of
redemption proceeds, distributions, and dividend payments to Cede & Co. (or such
other nominee as may be requested by an authorized representative of DTC) is the
responsibility of Issuer or Agent, disbursement of such payments to Direct
Participants will be the responsibility of DTC, and disbursement of such
payments to the Beneficial Owners will be the responsibility of Direct and
Indirect Participants.

   [9. A Beneficial Owner shall give notice to elect to have its Securities
purchased or tendered, through its Participant, to [Tender/Remarketing] Agent,
and shall effect delivery of such Securities by causing the Direct Participant
to transfer the Participant's interest in the Securities, on DTC's records, to
[Tender/Remarketing] Agent. The requirement for physical delivery of Securities
in connection with an optional tender or a mandatory purchase will be deemed
satisfied when the ownership rights in the Securities are transferred by Direct
Participants on DTC's records and followed by a book-entry credit of tendered
Securities to [Tender/Remarketing] Agent's DTC account.]

   10. DTC may discontinue providing its services as depository with respect to
the Securities at any time by giving reasonable notice to Issuer or Agent. Under
such circumstances, in the event that a successor depository is not obtained,
Security certificates are required to be printed and delivered.

   11. Issuer may decide to discontinue use of the system of book-entry-only
transfers through DTC (or a successor securities depository). In that event,
Security certificates will be printed and delivered to DTC.

   12. The information in this section concerning DTC and DTC's book-entry
system has been obtained from sources that Issuer believes to be reliable, but
Issuer takes no responsibility for the accuracy thereof.


                                                                         [03/05]





</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(13)(E)
<SEQUENCE>18
<FILENAME>c93084a1exv99wx13yxey.txt
<DESCRIPTION>ADMINISTRATION AGREEMENT
<TEXT>
<PAGE>
                                                                   EXHIBIT 13(e)

                            ADMINISTRATION AGREEMENT

         Agreement made as of May 31, 1997, as amended May 15, 2002 and June 1,
2004, between VAN KAMPEN MUNICIPAL TRUST, a Massachusetts business trust (the
"Fund"), and VAN KAMPEN FUNDS INC., a Delaware corporation (the "Administrator).

         WHEREAS, the Fund intends to operate as a closed-end management
investment company, and is so registered under the Investment Company act of
1940, as amended (the "1940 Act");

         WHEREAS, the Fund has authorized the issuance of its common shares of
beneficial interest, par value $.01 per share (the "Common Shares") and a class
of preferred shares of beneficial interest with preference rights, the relative
rights, terms and preferences of which are to be determined by the Board of
Trustees of the Fund (the "Preferred Shares") (holders of the Common Shares and
Preferred Shares are referred to collectively herein as the "Shareholders");

         WHEREAS, the Fund wishes to retain the Administrator to provide certain
administrative services to the Fund, under the terms and conditions stated
below, and the Administrator is willing to provide such services for the
compensation set forth below;

         NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties agree as follows:

         1. Appointment. The Fund hereby appoints the Administrator to
administer the Fund, and the Administrator accepts such appointment and agrees
that it will furnish the services set forth in paragraph 2 below.

         2. Services and Duties of the Administrator. Subject to the
supervision of the Fund's Board of Trustees (the "Board"), the Administrator
will:

                  (a) Prepare and assemble all reports required to be sent to
         the Fund Shareholders, and arrange for the printing and dissemination
         of such reports to Shareholders;

                  (b) Assemble all reports required to be filed with the
         Securities and Exchange Commission (the "SEC") on Form N-SAR, or such
         other form as the SEC may substitute for Form N-SAR, and file such
         completed form with the SEC;

                  (c) Arrange for the dissemination to Shareholders of the
         Fund's proxy materials and oversee the tabulation of proxies by the
         Fund's transfer agent;

                  (d) Negotiate the terms and conditions under which custodian
         services will be provided to the Fund and the fees to be paid by the
         Fund to its custodian (which may or may not be an affiliate of the
         Fund's investment adviser) in connection therewith;


<PAGE>


                  (e) Negotiate the terms and conditions under which dividend
         disbursing services will be provided to the Fund, and the fees to be
         paid by the Fund in connection therewith; review the provision of
         dividend disbursing services to the Fund;

                  (f) Determine the amounts available for distribution as
         dividends and distributions to be paid by the Fund to its Shareholders;
         prepare and arrange for the printing of dividend notices to
         Shareholders; and provide the Fund's dividend disbursing agent and
         custodian with such information as is required for such parties to
         effect the payment of dividends and distributions and to implement the
         Fund's dividend reinvestment plan;

                  (g) Provide Shareholder services to holders or potential
         holders of the Fund's securities including but not limited to
         responding to Shareholder requests for information;

                  (h) Assist in providing to the Fund's independent accountants
         such information as is necessary for such accountants to prepare and
         file the Fund's federal income and excise tax returns and the Fund's
         state and local tax returns;

                  (i) Assist the Fund's investment adviser in monitoring
         compliance of the Fund's operations with the 1940 Act and with its
         investment policies and limitations as currently in effect;

                  (j) In connection with the issuance of the Preferred Shares,
         calculate, monitor and provide the rating agencies such asset coverage
         and liquidity reports as the Board deems advisable with respect to
         obtaining a rating on the Preferred Shares;

                  (k) Oversee the maintenance of the Fund's books and records
         under Rule 31a-1 under the 1940 Act by the custodians and accounting
         agent, as applicable; and

                  (l) Make such reports and recommendations to the Board as the
         Board reasonably requests or deems appropriate.

         3. Public Inquiries. The Fund and the Administrator agree that the
Administrator will not be responsible for replying to questions or requests for
information concerning the Fund from Shareholders, brokers or the public. The
Fund will inform the Administrator of the party or parties to whom any such
questions or requests should be directed, and the Administrator will refer such
questions and requests to such party or parties.

         4. Compliance with the Fund's Governing Documents and Applicable Law.
In all matters relating to the performance of this Agreement, the Administrator
will act in conformity with the Declaration of Trust, By-Laws and registration
statements of the Fund and with the directions of the Board and Fund executive
officers and will conform

<PAGE>


to and comply with the requirements of the 1940 Act and all other applicable
federal or state laws and regulations.

         5. Service Not Exclusive. The Administrator's services hereunder are
not deemed to be exclusive, and the Administrator is free to render
administrative or other services to other funds or clients so long as the
Administrator's services under this Agreement are not impaired thereby.

         6. Use of Employees of the Investment Adviser. The Fund acknowledges
and agrees that the Administrator may, at its own cost, use employees of Van
Kampen Asset Management, the Fund's investment adviser, to perform a portion of
or all of the services required to be performed by the Administrator hereunder.

         7. Limitation of Liability of the Administrator. The Administrator will
not be liable for any error of judgment or mistake of law or for any loss
suffered by the Fund or its Shareholders in connection with the performance of
its duties under this Agreement, except a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the performance of its
duties or from reckless disregard by it of its duties under this Agreement.

         8. Limitation of Liability of the Trustees and Shareholders of the
Fund. Pursuant to the provisions of Article V, Section 5.5 of the Fund's
Declaration of Trust as amended or restated as of the date hereof, this
Agreement is entered into by the Board not individually, but as trustees under
such Declaration of Trust and the obligations of the Fund hereunder are not
binding upon any such trustees or Shareholders of the Fund, but bind only the
trust estate.

         9. Duration and Termination. This Agreement will become effective upon
the date hereabove written and shall continue in effect thereafter until
terminated without penalty by the Administrator or the Fund upon 30 days written
notice to the other and shall automatically terminate in the event of its
assignment as the term is defined in the 1940 Act.

         10. Amendment of this Agreement. No provision of this Agreement may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against which enforcement of the change, waiver or
discharge or termination is sought.

         11. Governing Law. This Agreement shall be construed in accordance with
the laws of the Commonwealth of Massachusetts and 1940 Act, without giving
effect to the principles of conflicts of law thereof. To the extent that the
applicable laws of the Commonwealth of Massachusetts conflict with the
applicable provisions of the 1940 Act, the latter shall control.

         12. Miscellaneous. The captions of this Agreement are included for
convenience of reference only and in no way define or delimit any of the
provisions hereof or otherwise affect their construction or effect. If any
provision of this Agreement


<PAGE>

shall be held or made invalid by a court decision, statute, rule or otherwise,
the remainder of this Agreement shall not be affected thereby.

         IN WITNESS WHEREOF, the parties hereto have caused this instrument to
be executed by their officers designated below, as amended on June 1, 2004.



                                        VAN KAMPEN MUNICIPAL TRUST



/s/      Stefanie V. Chang              By:       /s/ Ronald E. Robison
                                        Executive Vice President and Principal
                                        Executive Officer

                                        VAN KAMPEN FUNDS INC.



/s/      Mary E. Mullin                 By:      /s/ John L. Sullivan
                                                     Managing Director


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(13)(F)
<SEQUENCE>19
<FILENAME>c93084a1exv99wx13yxfy.txt
<DESCRIPTION>AMENDED AND RESTATED LEGAL SERVICES AGREEMENT
<TEXT>
<PAGE>
                                                                   EXHIBIT 13(f)

                              AMENDED AND RESTATED
                            LEGAL SERVICES AGREEMENT

      THIS AGREEMENT, dated as of September 1, 2002, by and between the parties
as set forth in Schedule 1, attached hereto and incorporated by reference
(designated collectively hereafter as the "Funds"), and VAN KAMPEN INVESTMENTS
INC., a Delaware corporation ("Van Kampen").

                              W I T N E S S E T H :

      WHEREAS, each of the Funds is registered as an investment company under
the Investment Company Act of 1940, as amended (the "1940 Act"); and

      WHEREAS, Van Kampen and its affiliates have the capability of providing
certain legal services to the Funds; and

      WHEREAS, each Fund desires to utilize Van Kampen and its affiliates in the
provision of such legal services; and

      WHEREAS, Van Kampen and its affiliates intend to provide staff in order to
accommodate the provision of all such services.

      NOW, THEREFORE, in consideration of the premises and the mutual covenants
spelled out herein, it is agreed between the parties hereto as follows:

1.    Appointment of Van Kampen. Van Kampen and/or personnel of affiliates of
      Van Kampen under the direction of Van Kampen shall provide each of the
      Funds the legal services (the "Legal Services") as set forth in Paragraph
      2 of this Agreement. Van Kampen accepts such appointments and agrees to
      furnish the Legal Services in return for the compensation provided in
      Paragraph 3 of this Agreement.

2.    Legal Services to be Provided. Van Kampen and/or personnel of affiliates
      of Van Kampen will provide to the Funds the following legal services,
      including without limitation: accurate maintenance of the Funds' corporate
      minute books and records, preparation and oversight of each Fund's
      regulatory reports and other information provided to shareholders as well
      as responding to day-to-day legal issues on behalf of the Funds. Van
      Kampen shall hire persons and/or supervise personnel of affiliates of Van
      Kampen (collectively

<PAGE>

      the "Legal Services Group") as needed to provide such Legal Services and
      in such numbers as may be agreed from time to time.

3.    Expenses and Reimbursement. The Legal Services expenses (the "Legal
      Services Expenses") for which Van Kampen may be reimbursed are salary and
      salary related benefits, including but not limited to bonuses, group
      insurance and other regular wages paid to the personnel of the Legal
      Services Group. Each member of the Legal Services Group will complete as
      of the last business day of each month, a time allocation sheet indicating
      the monthly time spent (reflected as a percentage) on matters relating to
      the Funds, on matters relating to other funds for which Van Kampen or its
      subsidiaries act as investment adviser and distributor ("Van Kampen
      Non-Participating Funds") and for other matters. The aggregate of time
      spent on matters for the Funds and Van Kampen Non-Participating Funds is
      referred to herein as the "Fund Percentage". Each member's Fund Percentage
      shall be multiplied by each member's individual Legal Service Expense; the
      resulting product for each member shall then be aggregated to arrive at
      the Legal Services Expenses that can be allocated as set forth in
      Paragraph 4 ("Allocable Legal Services Expenses"). The Legal Services
      Expenses will be paid by Van Kampen (or the affiliate of Van Kampen
      employing such Legal Services Group persons) and that portion of such
      Legal Services Expenses allocated to the Funds as set forth in Paragraph 4
      shall be reimbursed by the Funds. Van Kampen will tender to each Fund a
      monthly invoice within five business days of the last business day of each
      month which shall certify the total Legal Service Expenses expended and
      allocated to such Fund. Except as provided herein, Van Kampen will receive
      no other compensation in connection with Legal Services rendered in
      accordance with this Agreement, and Van Kampen and its affiliates will be
      responsible for all other expenses relating to the providing of Legal
      Services.

4.    Payment for Allocable Legal Services Expense Among the Funds. Each month,
      one half (50%) of the Allocable Legal Services Expenses incurred under the
      Agreement shall be attributable equally to each respective Fund and Van
      Kampen Non-Participating Fund. Van Kampen shall assume the costs of Legal
      Services Expenses for the Van Kampen Non-Participating Funds for which
      reimbursement is not received. The remaining one half (50%) of the
      Allocable Legal Services Expenses shall be in allocated (a) in the event
      services are attributable to specific funds (including the Van Kampen
      Non-Participating Funds) based on such specific time allocations; and (b)
      in the

                                       2
<PAGE>

      event services are attributable only to types of funds (i.e. closed-end
      and open-end funds), the relative amount of time spent on each type of
      fund and then further allocated between funds of that type on the basis of
      relative net assets at the end of the period.

5.    Maintenance of Records. All records maintained by Van Kampen in connection
      with the performance of its duties under this Agreement will remain the
      property of each respective Fund and will be preserved by Van Kampen for
      the periods prescribed in Section 31 of the 1940 Act and the rules
      thereunder or such other applicable rules that may be adopted from time to
      time under the 1940 Act. In the event of termination of the Agreement,
      such records will be promptly delivered to the respective Funds. Such
      records may be inspected by the respective Funds at reasonable times.

6.    Liability of Van Kampen. Van Kampen shall not be liable to any Fund for
      any action taken or thing done by it or its agents or contractors on
      behalf of the Fund in carrying out the terms and provisions of the
      Agreement if done in good faith and without negligence or misconduct on
      the part of Van Kampen, its agents or contractors.

7.    Indemnification By Funds. Each Fund will indemnify and hold Van Kampen
      harmless from all loss, cost, damage and expense, including reasonable
      expenses for legal counsel, incurred by Van Kampen resulting from (a) any
      claim, demand, action or suit in connection with Van Kampen's acceptance
      of this Agreement; (b) an action or omission by Van Kampen in the
      performance of its duties hereunder; (c) Van Kampen's acting upon
      instructions believed by it to have been executed by a duly authorized
      officer of the Fund; or (d) Van Kampen's acting upon information provided
      by the Fund in form and under policies agreed to by Van Kampen and the
      Fund. Van Kampen shall not be entitled to such indemnification in respect
      of action or omissions constituting negligence or willful misconduct of
      Van Kampen or its agents or contractors. Prior to admitting any claim
      against it which may be subject to this indemnification, Van Kampen shall
      give the Fund reasonable opportunity to defend against said claim on its
      own name or in the name of Van Kampen.

                                       3
<PAGE>

8.    Indemnification By Van Kampen. Van Kampen will indemnify and hold harmless
      each Fund from all loss, cost, damage and expense, including reasonable
      expenses for legal counsel, incurred by the Fund resulting from any claim,
      demand, action or suit arising out of Van Kampen's failure to comply with
      the terms of this Agreement or which arises out of the negligence or
      willful misconduct of Van Kampen or its agents or contractors; provided,
      that such negligence or misconduct is not attributable to the Funds, their
      agents or contractors. Prior to admitting any claim against it which may
      be subject to this indemnification, the Fund shall give Van Kampen
      reasonable opportunity to defend against said claim in its own name or in
      the name of such Fund.

9.    Further Assurances. Each party agrees to perform such further acts and
      execute such further documents as necessary to effectuate the purposes
      hereof.

10.   Dual Interests. It is understood that some person or persons may be
      directors, trustees, officers, or shareholders of both the Funds and Van
      Kampen (including Van Kampen's affiliates), and that the existence of any
      such dual interest shall not affect the validity hereof or of any
      transactions hereunder except as otherwise provided by a specific
      provision of applicable law.

11.   Execution, Amendment and Termination. The term of this Agreement shall
      begin as of the date first above written, and unless sooner terminated as
      herein provided, this Agreement shall remain in effect thereafter from
      year to year if such continuation is specifically approved at least
      annually by the Board of Trustees of each Fund, including a majority of
      the independent Trustees of each Fund. The Agreement may be modified or
      amended from time to time by mutual agreement between parties, and the
      Funds shall reimburse Van Kampen for its costs, expenses and disbursements
      payable under this Agreement to such date. This Agreement may be amended
      in the future to include as additional parties to the Agreement other
      investment companies for which Van Kampen, any subsidiary or affiliate
      serves as investment advisor or distributor.

12.   Assignment. Any interest of Van Kampen under this Agreement shall not be
      assigned or transferred, either voluntarily or involuntarily, by operation
      of

                                       4
<PAGE>

      law or otherwise, without the prior written consent of the Fund. This
      Agreement shall automatically and immediately terminate in the event of
      its assignment without the prior written consent of the Fund.

13.   Notice. Any notice under this agreement shall be in writing, addressed and
      delivered or sent by registered or certified mail, postage prepaid, to the
      other party at such address as such other party may designate for the
      receipt of such notices. Until further notice to the other parties, it is
      agreed that for this purpose the address of each Fund is 1 Parkview Plaza,
      Oakbrook Terrace, Illinois 60181, Attention: Treasurer and the address of
      Van Kampen, for this purpose is 1 Parkview Plaza, Oakbrook Terrace,
      Illinois 60181, Attention: Treasurer.

14.   Personal Liability. As provided for in the Declaration of Trust of the
      various Funds, under which the Funds are organized as unincorporated
      trusts under the laws of the State of Delaware, Massachusetts or
      Pennsylvania, as the case may be, the shareholders, trustees, officers,
      employees and other agents of the Fund shall not personally be bound by or
      liable for the matters set forth hereunder, nor shall resort be had to
      their private property for the satisfaction of any obligation or claim
      hereunder.

15.   Interpretative Provisions. In connection with the operations of this
      agreement, Van Kampen and the Funds may agree from time to time on such
      provisions interpretative of or in addition to the provisions of this
      Agreement as may in their opinion be consistent with the general tenor of
      this Agreement.

16.   State Law. This Agreement shall be construed and enforced in accordance
      with and governed by the laws of the State of Illinois.

17.   Captions. The captions in the Agreement are included for convenience of
      reference only and in no way define or limit any of the provisions hereof
      or otherwise affect their construction effect.

                                       5
<PAGE>

      IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
      as of the day and year first above written.

                                          ALL OF THE PARTIES SET FORTH
                                          IN SCHEDULE 1 ATTACHED HERETO

                                          By:      /s/ John Sullivan
                                              ----------------------------------
                                                   John Sullivan
                                                   Vice President and Treasurer

                                          VAN KAMPEN INVESTMENTS INC.

                                          By:      /s/ A. Thomas Smith
                                              ----------------------------------
                                                   A. Thomas Smith
                                                   Managing Director

                                       6
<PAGE>

                                   SCHEDULE 1
OPEN END FUNDS

VAN KAMPEN SERIES FUND, INC.

Van Kampen American Value Fund
Van Kampen Asian Equity Fund
Van Kampen Emerging Markets Fund
Van Kampen Equity Growth Fund
Van Kampen European Value Equity Fund
Van Kampen Focus Equity Fund
Van Kampen Global Equity Allocation Fund
Van Kampen Global Franchise Fund
Van Kampen Global Value Equity Fund
Van Kampen International Magnum Fund
Van Kampen Latin American Fund
Van Kampen Mid Cap Growth Fund
Van Kampen Value Fund
Van Kampen Worldwide High Income Fund

VAN KAMPEN U.S. GOVERNMENT TRUST

Van Kampen U.S. Government Fund

VAN KAMPEN TAX FREE TRUST

Van Kampen California Insured Tax Free Fund
Van Kampen Insured Tax Free Income Fund
Van Kampen Intermediate Term Municipal Income Fund
Van Kampen Municipal Income Fund
Van Kampen New York Tax Free Income Fund
Van Kampen Strategic Municipal Income Fund

Van Kampen Pennsylvania Tax Free Income Fund

VAN KAMPEN EQUITY TRUST

Van Kampen Aggressive Growth Fund
Van Kampen Growth Fund
Van Kampen Select Growth Fund
Van Kampen Small Cap Growth Fund
Van Kampen Small Cap Value Fund
Van Kampen Utility Fund
Van Kampen Value Opportunities Fund

VAN KAMPEN TRUST

Van Kampen High Yield Fund

VAN KAMPEN EQUITY TRUST II

Van Kampen Technology Fund
Van Kampen Tax Managed Equity Growth Fund
Van Kampen International Advantage Fund

Van Kampen Tax Free Money Fund

VAN KAMPEN LIFE INVESTMENT TRUST

Aggressive Growth Portfolio

                                       7
<PAGE>

CLOSED END FUNDS

Van Kampen Advantage Municipal Income Trust
Van Kampen Advantage Municipal Income Trust II
Van Kampen Advantage Pennsylvania Municipal Income Trust
Van Kampen California Municipal Trust
Van Kampen California Quality Municipal Trust
Van Kampen California Value Municipal Income Trust
Van Kampen Florida Quality Municipal Trust
Van Kampen High Income Trust
Van Kampen High Income Trust II
Van Kampen Investment Grade Municipal Trust
Van Kampen Massachusetts Value Municipal Income Trust
Van Kampen Municipal Income Trust
Van Kampen Municipal Opportunity Trust
Van Kampen Municipal Opportunity Trust II
Van Kampen Municipal Trust
Van Kampen New York Quality Municipal Trust
Van Kampen New York Value Municipal Income Trust
Van Kampen Ohio Quality Municipal Trust
Van Kampen Ohio Value Municipal Income Trust
Van Kampen Pennsylvania Quality Municipal Trust
Van Kampen Pennsylvania Value Municipal Income Trust
Van Kampen Prime Rate Income Trust
Van Kampen Select Sector Municipal Trust
Van Kampen Senior Floating Rate Fund
Van Kampen Senior Income Trust
Van Kampen Strategic Sector Municipal Trust
Van Kampen Trust for Insured Municipals
Van Kampen Trust for Investment Grade California Municipals
Van Kampen Trust for Investment Grade Florida Municipals
Van Kampen Trust for Investment Grade Municipals
Van Kampen Trust for Investment Grade New Jersey Municipals
Van Kampen Trust for Investment Grade New York Municipals
Van Kampen Trust for Investment Grade Pennsylvania Municipals
Van Kampen Value Municipal Income Trust

                                        8
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(13)(G)
<SEQUENCE>20
<FILENAME>c93084a1exv99wx13yxgy.txt
<DESCRIPTION>FUND ACCOUNTING AGREEMENT AND AMENDMENT THERETO
<TEXT>
<PAGE>
                                                                   EXHIBIT 13(g)


                            FUND ACCOUNTING AGREEMENT

      THIS AGREEMENT, dated May 31, 1997, by and between the parties set forth
in Schedule A hereto (designated collectively hereafter as the "Funds") and VAN
KAMPEN AMERICAN CAPITAL INVESTMENT ADVISORY CORP., a Delaware corporation
("Advisory Corp.").

                              W I T N E S S E T H:

      WHEREAS, each of the Funds is registered as a management investment
company under the Investment Company Act of 1940, as amended (the "1940 Act");
and

      WHEREAS, Advisory Corp. has the capability of providing certain accounting
services to the Funds; and

      WHEREAS, each desires to utilized Advisory Corp. in the provision of such
accounting services; and

      WHEREAS, Advisory Corp. intends to maintain its staff in order to
accommodate the provision of all such services.

      NOW THEREFORE, in consideration of the premises and the mutual covenants
spelled out herein, it is agreed between the parties hereto as follows:

1. Appointment of Advisory Corp.. As agent, Advisory Corp. shall provide each of
the Funds the accounting services ("Accounting Services") as set forth in
Paragraph 2 of this Agreement. Advisory Corp. accepts such appointment and
agrees to furnish the Accounting Services in return for the compensation
provided in Paragraph 3 of this Agreement.

2. Accounting Services to be Provided. Advisory Corp. will provide to each
respective Fund accounting related services in connection with the maintenance
of the financial records of such Fund, including without limitation: (i)
maintenance of the general ledger and other financial books and records; (ii)
processing of portfolio transactions; (iii) coordination of the valuation of
portfolio securities; (iv) calculation of the Fund's net asset value; (v)
coordination of financial and regulatory reporting; (vi) preparation of
financial reports for each Fund's Board of Trustees; (vii) coordination of tax
and financial compliance issues; (viii) the establishment and maintenance of
accounting policies; (ix) recommendations with respect to dividend policies; (x)
preparation of each Fund's financial reports and other accounting and tax
related notice information to shareholders; and (xi) the assimilation and
interpretation of accounting data for meaningful management review. Advisory
Corp. shall provide accurate maintenance of each Fund's financial books and
records as required by the applicable securities statutes and regulations, and
shall hire persons (collectively the "Accounting Service Group") as needed to
provide such Accounting Services.

                                        1
<PAGE>

3. Expenses and Reimbursements. Advisory Corp. shall be reimbursed by the Funds
for all costs and services incurred in connection with the provision of the
aforementioned Accounting Services ("Accounting Service Expenses"), including
but not limited to all salary and related benefits paid to the personnel of the
Accounting Service Group, overhead and expenses related to office space and
related equipment and out-of-pocket expenses.

   The Accounting Services Expenses will be paid by Advisory Corp. and
reimbursed by the Funds. Advisory Corp. will tender to each Fund a monthly
invoice as of the last business day of each month which shall certify the total
support service expenses expended. Except as provided herein, Advisory Corp.
will receive no other compensation in connection with Accounting Services
rendered in accordance with this Agreement.

4. Payment for Accounting Service Expenses Among the Funds. As to one quarter
(25%) of the Accounting Service Expenses incurred under the Agreement, the
expense shall be allocated between all Funds based on the number of classes of
shares of beneficial interest that each respective Fund has issued. As to the
remaining three quarters (75%) of the Accounting Service Expenses incurred under
the Agreement, the expense shall be allocated between all Funds based on their
relative net assets. For purposes of determining the percentage of expenses to
be allocated to any Fund, the liquidation preference of any preferred shares
issued by any such Fund shall not be considered a liability of such Fund for the
purposes of calculating relative net assets of such Fund.

5. Maintenance of Records. All records maintained by Advisory Corp. in
connection with the performance of its duties under this Agreement will remain
the property of each respective Fund and will be preserved by Advisory Corp. for
the periods prescribed in Section 31 of the 1940 Act and the rules thereunder or
such other applicable rules that may be adopted from time to time under the act.
In the event of termination of the Agreement, such records will be promptly
delivered to the respective Funds. Such records may be inspected by the
respective Funds at reasonable times.

6. Liability of Advisory Corp. Advisory Corp. shall not be liable to any Fund
for any action taken or thing done by it or its agents or contractors on behalf
of the fund in carrying out the terms and provisions of the Agreement if done in
good faith and without gross negligence or misconduct on the part of Advisory
Corp., its agents or contractors.

7. Indemnification By Funds. Each Fund will indemnify and hold Advisory Corp.
harmless from all lost, cost, damage and expense, including reasonable expenses
for legal counsel, incurred by Advisory Corp. resulting from: (a) any claim,
demand, action or suit in connection with Advisory Corp.'s acceptance of this
Agreement; (b) any action or omission by Advisory Corp. in the performance of
its duties hereunder; (c) Advisory Corp.'s acting upon instructions believed by
it to have been executed by a duly authorized officer of the Fund; or (d)
Advisory Corp.'s acting upon information provided by the Fund in form and under
policies agreed to by Advisory Corp. and the Fund. Advisory Corp. shall not be
entitled to such indemnification in respect of actions or omissions constituting
gross negligence or willful misconduct of Advisory Corp. or its agents or
contractors. Prior to confessing any claim against it which may be subject

                                       2
<PAGE>

to this indemnification, Advisory Corp. shall give the Fund reasonable
opportunity to defend against said claim in its own name or in the name of
Advisory Corp.

8. Indemnification By Advisory Corp. Advisory Corp. will indemnify and hold
harmless each Fund from all loss, cost, damage and expense, including reasonable
expenses for legal counsel, incurred by the Fund resulting from any claim,
demand, action or suit arising out of Advisory Corp.'s failure to comply with
the terms of this Agreement or which arises out of the gross negligence or
willful misconduct of Advisory Corp. or its agents or contractors; provided that
such negligence or misconduct is not attributable to the Funds, their agents or
contractors. Prior to confessing any claim against it which may be subject to
this indemnification, the Fund shall give Advisory Corp. reasonable opportunity
to defend against said claim in its own name or in the name of such Fund.

9. Further Assurances. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof.

10. Dual Interests. It is understood that some person or persons may be
directors, trustees, officers or shareholders of both the Funds and Advisory
Corp. (including Advisory Corp.'s affiliates), and that the existence of any
such dual interest shall not affect the validity hereof or of any transactions
hereunder except as otherwise provided by a specific provision of applicable
law.

11. Execution, Amendment and Termination. The term of this Agreement shall begin
as of the date first above written, and unless sooner terminated as herein
provided, this Agreement shall remain in effect through May, 1998, and
thereafter from year to year, if such continuation is specifically approved at
least annually by the Board of Trustees of each Fund, including a majority of
the independent Trustees of each Fund. This Agreement may be modified or amended
from time to time by mutual agreement between the parties hereto and may be
terminated after May, 1998, by at least sixty (60) days' written notice given by
one party to the others. Upon termination hereof, each Fund shall pay to
Advisory Corp. such compensation as may be due as of the date of such
termination and shall likewise reimburse Advisory Corp. for its costs, expenses
and disbursements payable under this Agreement to such date. This Agreement may
be amended in the future to include as additional parties to the Agreement other
investment companies for with Advisory Corp., any subsidiary or affiliate serves
as investment advisor or distributor if such amendment is approved by the
President of each Fund.

12. Assignment. Any interest of Advisory Corp. under this Agreement shall not be
assigned or transferred, either voluntarily or involuntarily, by operation of
law or otherwise, without the prior written consent of the Funds. This Agreement
shall automatically and immediately terminate in the event of its assignment
without the prior written consent of the Funds.

13. Notice. Any notice under this Agreement shall be in writing, addressed and
delivered or sent by registered or certified mail, postage prepaid, to the other
party at such address as such other party may designate for the receipt of such
notices. Until further notice to the other parties, it is agreed that for this
purpose the address of each Fund is One Parkview Plaza, Oakbrook Terrace,
Illinois 60181, Attention: President and that of Advisory Corp. for this purpose
is One

                                       3
<PAGE>

Parkview Plaza, Oakbrook Terrace, Illinois 60181, Attention: President.

14. Personal Liability. As provided for in the Agreement and Declaration of
Trust of the various Funds, under which the Funds are organized as
unincorporated trusts, the shareholders, trustees, officers, employees and other
agents of the Fund shall not personally be found by or liable for the matters
set forth hereto, nor shall resort be had to their private property for the
satisfaction of any obligation or claim hereunder.

15. Interpretative Provisions. In connection with the operation of this
Agreement, Advisory Corp. and the Funds may agree from time to time on such
provisions interpretative of or in addition to the provisions of this Agreement
as may in their joint opinion be consistent with the general tenor of this
Agreement.

16. State Law. This Agreement shall be construed and enforced in accordance with
and governed by the laws of the State of Illinois.

17. Captions. The captions in this Agreement are included for convenience of
reference only and in no way define or limit any of the provisions hereof or
otherwise affect their construction or effect.

    IN WITNESS WHEREOF, the parties have caused this amended and restated
Agreement to be executed as of the day and year first above written.

ALL OF THE PARTIES SET FORTH IN SCHEDULE A

By:       /s/ Ronald A. Nyberg
    --------------------------------
    Ronald A. Nyberg, Vice President

VAN KAMPEN AMERICAN CAPITAL INVESTMENT ADVISORY CORP.

By:     /s/ Dennis J. McDonnell
    ------------------------------
    Dennis J. McDonnell, President

                                        4
<PAGE>

                                   SCHEDULE A

I. FUNDS ADVISED BY VAN KAMPEN AMERICAN CAPITAL INVESTMENT ADVISORY CORP.
("INVESTMENT ADVISORY CORP.") (COLLECTIVELY, THE "FORMER VAN KAMPEN FUNDS"):

CLOSED END FUNDS

Van Kampen American Capital Municipal Income Trust
Van Kampen American Capital California Municipal Trust
Van Kampen American Capital High Income Trust
Van Kampen American Capital High Income Trust II
Van Kampen American Capital Investment Grade Municipal Trust
Van Kampen American Capital Municipal Trust
Van Kampen American Capital California Quality Municipal Trust
Van Kampen American Capital Florida Quality Municipal Trust
Van Kampen American Capital New York Quality Municipal Trust
Van Kampen American Capital Ohio Quality Municipal Trust
Van Kampen American Capital Pennsylvania Quality Municipal Trust
Van Kampen American Capital Trust For Insured Municipals
Van Kampen American Capital Trust For Investment Grade Municipals
Van Kampen American Capital Trust For Investment Grade California Municipals
Van Kampen American Capital Trust For Investment Grade Florida Municipals
Van Kampen American Capital Trust For Investment Grade New Jersey Municipals
Van Kampen American Capital Trust For Investment Grade New York Municipals
Van Kampen American Capital Trust For Investment Grade Pennsylvania Municipals
Van Kampen American Capital Municipal Opportunity Trust
Van Kampen American Capital Advantage Municipal Income Trust
Van Kampen American Capital Advantage Pennsylvania Municipal Income Trust
Van Kampen American Capital Strategic Sector Municipal Trust
Van Kampen American Capital Value Municipal Income Trust
Van Kampen American Capital California Value Municipal Income Trust
Van Kampen American Capital Massachusetts Value Municipal Income Trust
Van Kampen American Capital New Jersey Value Municipal Income Trust
Van Kampen American Capital New York Value Municipal Income Trust
Van Kampen American Capital Ohio Value Municipal Income Trust
Van Kampen American Capital Pennsylvania Value Municipal Income Trust
Van Kampen American Capital Municipal Opportunity Trust II
Van Kampen American Capital Florida Municipal Opportunity Trust
Van Kampen American Capital Advantage Municipal Income Trust II
Van Kampen American Capital Select Sector Municipal Trust

                                        1
<PAGE>

INSTITUTIONAL FUNDS

II. FUNDS ADVISED BY VAN KAMPEN AMERICAN CAPITAL MANAGEMENT, INC. ("MANAGEMENT,
INC.") (COLLECTIVELY, THE "FORMER VAN KAMPEN FUNDS"):

The Explorer Institutional Trust
 on behalf of its series
Explorer Institutional Active Core Fund
Explorer Institutional Limited Duration Fund

OPEN END FUNDS

III. FUNDS ADVISED BY VAN KAMPEN AMERICAN CAPITAL ASSET MANAGEMENT, INC.
("ASSET MANAGEMENT, INC.") (COLLECTIVELY, THE "FORMER AMERICAN CAPITAL
FUNDS"):

Van Kampen American Capital Comstock Fund ("Comstock Fund")
Van Kampen American Capital Corporate Bond Fund ("Corporate Bond Fund")
Van Kampen American Capital Emerging Growth Fund ("Emerging Growth Fund")
Van Kampen American Capital Enterprise Fund ("Enterprise Fund")
Van Kampen American Capital Equity Income Fund ("Equity Income Fund")
Van Kampen American Capital Global Managed Assets Fund ("Global Managed Assets
        Funds")
Van Kampen American Capital Government Securities Fund ("Government Securities
        Fund")
Van Kampen American Capital Government Target Fund ("Government Target Fund")
Van Kampen American Capital Growth and Income Fund ("Growth and Income Fund")
Van Kampen American Capital Harbor Fund ("Harbor Fund")
Van Kampen American Capital High Income Corporate Bond Fund ("High Income
        Corporate Bond Fund")
Van Kampen American Capital High Income Corporate Bond Fund ("High Income
        Corporate Bond Fund")

Van Kampen American Capital Life Investment Trust ("Life Investment Trust" or
     "LIT") on behalf of its Series

   Enterprise Portfolio ("LIT Enterprise Portfolio")
   Domestic Income Portfolio ("LIT Domestic Income Portfolio")
   Emerging Growth Portfolio  ("LIT Emerging Growth Portfolio")
   Government Portfolio ("LIT Government Portfolio")
   Asset Allocation Portfolio ("LIT Asset Allocation Portfolio")
   Money Market Portfolio ("LIT Money Market Portfolio")
   Real Estate Securities Portfolio ("LIT Real Estate Securities Portfolio")
   Growth and Income Portfolio ("LIT Growth and Income Portfolio")

Van Kampen American Capital Limited Maturity Government Fund ("Limited
        Maturity Government Fund")
Van Kampen American Capital Pace Fund ("Pace Fund")
Van Kampen American Capital Real Estate Securities Fund ("Real Estate
        Securities Fund")
Van Kampen American Capital Reserve Fund ("Reserve Fund")
Van Kampen American Capital Small Capitalization Fund ("Small
        Capitalization Fund")

                                     2
<PAGE>

Van Kampen American Capital Tax-Exempt Trust ("Tax-Exempt Trust")
on behalf of its Series
   Van Kampen American Capital High Yield Municipal Fund ("High Yield Municipal
   Fund")

Van Kampen American Capital U.S. Government Trust for Income ("U.S. Government
        Trust for Income")

IV. FUNDS ADVISED BY VAN KAMPEN AMERICAN CAPITAL INVESTMENT ADVISORY CORP.
("INVESTMENT ADVISORY CORP.") (COLLECTIVELY, THE "FORMER VAN KAMPEN FUNDS"):

Van Kampen American Capital U.S. Government Trust ("U.S. Government Trust")
   on behalf of its series
Van Kampen American Capital U.S. Government Fund ("U.S. Government Fund")

Van Kampen American Capital Tax Free Trust ("Tax Free Trust")
   on behalf of its series
Van Kampen American Capital Insured Tax Free Income Fund ("Insured Tax Free
        Income Fund")
Van Kampen American Capital Tax Free High Income Fund ("Tax Free High Income
        Fund")
Van Kampen American Capital California Insured Tax Free Fund ("California
        Insured Tax Free Fund")
Van Kampen American Capital Municipal Income Fund ("Municipal Income Fund")
Van Kampen American Capital Intermediate Term Municipal Income Fund
        (Intermediate Term Municipal Income Fund")
Van Kampen American Capital Florida Insured Tax Free Income Fund ("Florida
        Insured Tax Free Income Fund")
Van Kampen American Capital New Jersey Tax Free Income Fund ("New Jersey Tax
        Free Income Fund")
Van Kampen American Capital New York Tax Free Income Fund ("New York Tax Free
        Income Fund")
Van Kampen American Capital California Tax Free Income Fund ("California Tax
        Free Income Fund")
Van Kampen American Capital Michigan Tax Free Income Fund ("Michigan Tax Free
        Income Fund")
Van Kampen American Capital Missouri Tax Free Income Fund ("Missouri Tax Free
        Income Fund")
Van Kampen American Capital Ohio Tax Free Income Fund ("Ohio Tax Free Income
        Fund")

Van Kampen American Capital Trust ("VKAC Trust")
Van Kampen American Capital High Yield Fund ("High Yield Fund")
Van Kampen American Capital Short-Term Global Income Fund ("Short-Term Global
        Income Fund")
Van Kampen American Capital Strategic Income Fund ("Strategic Income Fund")

Van Kampen American Capital Equity Trust ("Equity Trust")

                                        3
<PAGE>

        on behalf of its series
Van Kampen American Capital Utility Fund ("Utility Fund")
Van Kampen American Capital Growth Fund ("Growth Fund")
Van Kampen American Capital Value Fund ("Value Fund")
Van Kampen American Capital Great American Companies Fund ("Great American
        Companies Fund")
Van Kampen American Capital Prospector Fund ("Prospector Fund")
Van Kampen American Capital Aggressive Growth Fund ("Aggressive Growth Fund")

Van Kampen American Capital Foreign Securities Fund ("Foreign Securities Fund")

Van Kampen American Capital Pennsylvania Tax Free Income Fund ("Pennsylvania Tax
        Free Income Fund")

Van Kampen American Capital Tax Free Money Fund ("Tax Free Money Fund")

                                        4
<PAGE>

                              AMENDMENT NUMBER SIX

                                     TO THE

                            FUND ACCOUNTING AGREEMENT

      THIS AMENDMENT NUMBER SIX, dated May 31, 2000, to the Fund Accounting
Agreement dated May 31, 1997 (the "Agreement") by and between the parties set
forth in Schedule A, attached hereto and incorporated by reference and Van
Kampen Investment Advisory Corp., a Delaware corporation ("Advisory Corp.").

                               W I T N E S S E T H

      WHEREAS, the Funds wish to amend the current Fund Accounting Agreement in
accordance with the terms set forth by the Boards of Trustees/Directors of the
Van Kampen Open End Funds at a Meeting held on April 17, 2000 and the Boards of
Trustees of the Van Kampen Closed End Funds at a Meeting held on May 30, 2000;

      NOW, THEREFORE, in consideration of the promises and mutual covenants
spelled out in the Agreement and herein, it is hereby agreed that the Agreement
be amended to add Section 13 and renumber the remaining Sections of the
Agreement as follows:

      13. Delegation of Accounting Services. Advisory Corp. may delegate the
      provision of all or a portion of the Advisory Services contemplated herein
      to such other parties as may be approved by the Board of each Fund. In the
      event of any such delegation, the Funds shall reimburse Advisory Corp. for
      expense related to those Accounting Services provided by Advisory Corp.,
      and shall pay such sub-accounting agents such compensation as may be
      agreed from time to time by the Funds and the sub-accounting agent. In the
      event of such delegation, Advisory Corp. shall oversee the activities of
      such sub-accounting agent on behalf of the Funds.

      14. Notice. Any notice under this Agreement shall be in writing, addressed
      and delivered or sent by registered or certified mail, postage prepaid, to
      the other party at such address as such other party may designate for the
      receipt of such notices. Until further notice to the other parties, it is
      agreed that for this purpose the address of each Fund is One Parkview
      Plaza, Oakbrook Terrace, Illinois 60181, Attention: President and that of
      Advisory Corp. for this purpose is One Parkview Plaza, Oakbrook Terrace,
      Illinois 60181, Attention: President.

                                        1
<PAGE>

      15. Personal Liability. As provided for in the Agreement and Declaration
      of Trust of the various Funds, under which the Funds are organized as
      unincorporated trusts, the shareholders, trustees, officers, employees and
      other agents of the Fund shall not personally be found by or liable for
      the matters set forth hereto, nor shall resort be had to their private
      property for the satisfaction of any obligation or claim hereunder.

      16. Interpretative Provisions. In connection with the operation of this
      Agreement, Advisory Corp. and the Funds may agree from time to time on
      such provisions interpretative of or in addition to the provisions of this
      Agreement as may in their joint opinion be consistent with the general
      tenor of this Agreement.

      17. State Law. This Agreement shall be construed and enforced in
      accordance with and governed by the laws of the State of Illinois.

      18. Captions. The captions in this Agreement are included for convenience
      of reference only and in no way define or limit any of the provisions
      hereof or otherwise affect their construction or effect.

      IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the day and year first above written.

ALL OF THE PARTIES SET FORTH IN SCHEDULE A

By:      /s/ A. Thomas Smith III
    -------------------------------
      A. Thomas Smith III
      Vice President and Secretary

VAN KAMPEN INVESTMENT ADVISORY CORP.

By:     /s/ John L. Sullivan
    ---------------------------
       John L. Sullivan
       Senior Vice President

                                       2
<PAGE>

                                   SCHEDULE A

I. FUNDS ADVISED BY VAN KAMPEN INVESTMENT ADVISORY CORP. ("INVESTMENT ADVISORY
   CORP.") (COLLECTIVELY, THE "INVESTMENT ADVISORY CORP. FUNDS")

   CLOSED END FUNDS

   Van Kampen Municipal Income Trust
   Van Kampen California Municipal Trust
   Van Kampen High Income Trust
   Van Kampen High Income Trust II
   Van Kampen Investment Grade Municipal Trust
   Van Kampen Municipal Trust
   Van Kampen California Quality Municipal Trust
   Van Kampen Florida Quality Municipal Trust
   Van Kampen New York Quality Municipal Trust
   Van Kampen Ohio Quality Municipal Trust
   Van Kampen Pennsylvania Quality Municipal Trust
   Van Kampen Trust For Insured Municipals
   Van Kampen Trust For Investment Grade Municipals
   Van Kampen Trust For Investment Grade California Municipals
   Van Kampen Trust For Investment Grade Florida Municipals
   Van Kampen Trust For Investment Grade New Jersey Municipals
   Van Kampen Trust For Investment Grade New York Municipals
   Van Kampen Trust For Investment Grade Pennsylvania Municipals
   Van Kampen Municipal Opportunity Trust
   Van Kampen Advantage Municipal Income Trust
   Van Kampen Advantage Pennsylvania Municipal Income Trust
   Van Kampen Strategic Sector Municipal Trust
   Van Kampen Value Municipal Income Trust
   Van Kampen California Value Municipal Income Trust
   Van Kampen Massachusetts Value Municipal Income Trust
   Van Kampen New Jersey Value Municipal Income Trust
   Van Kampen New York Value Municipal Income Trust
   Van Kampen Ohio Value Municipal Income Trust
   Van Kampen Pennsylvania Value Municipal Income Trust
   Van Kampen Municipal Opportunity Trust II
   Van Kampen Florida Municipal Opportunity Trust
   Van Kampen Advantage Municipal Income Trust II
   Van Kampen Select Sector Municipal Trust

   OPEN END FUNDS
   Van Kampen U.S. Government Trust ("U.S. Government Trust")
   on behalf of its series
      Van Kampen U.S. Government Fund ("U.S. Government Fund")

   Van Kampen Tax Free Trust ("Tax Free Trust")

                                       3
<PAGE>

   on behalf of its series
      Van Kampen Insured Tax Free Income Fund ("Insured Tax Free Income Fund")
      Van Kampen Tax Free High Income Fund ("Tax Free High Income Fund")
      Van Kampen California Insured Tax Free Fund ("California Insured Tax Free
      Fund")
      Van Kampen Municipal Income Fund ("Municipal Income Fund")
      Van Kampen Intermediate Term Municipal Income Fund (Intermediate Term
      Municipal Income Fund")
      Van Kampen Florida Insured Tax Free Income Fund ("Florida Insured Tax Free
      Income Fund")
      Van Kampen New York Tax Free Income Fund  ("New York Tax Free Income
      Fund")
      Van Kampen California Municipal Income Fund ("California Municipal Income
      Fund")
      Van Kampen Michigan Tax Free Income Fund ("Michigan Tax Free Income Fund")
      Van Kampen Missouri Tax Free Income Fund ("Missouri Tax Free Income Fund")
      Van Kampen Ohio Tax Free Income Fund ("Ohio Tax Free Income Fund")

   Van Kampen Trust ("VK Trust")
   on behalf of its series
      Van Kampen High Yield Fund ("High Yield Fund")
      Van Kampen Strategic Income Fund ("Strategic Income Fund")
      Van Kampen Managed Short Term Income Fun d ("Managed Short Term Income
      Fund")

   Van Kampen Equity Trust ("Equity Trust")
   on behalf of its series
      Van Kampen Utility Fund ("Utility Fund")
      Van Kampen Growth Fund ("Growth Fund")
      Van Kampen Aggressive Growth Fund ("Aggressive Growth Fund")
      Van Kampen Small Cap Value Fund ("Small Cap Value Fund")
      Van Kampen Small Company Growth Fund ("Small Company Growth Fund")
      Van Kampen Select Growth Fund ("Select Growth Fund")
      Van Kampen Small Cap Growth Fund ("Small Cap Growth Fund")

   Van Kampen Equity Trust II ("Equity Trust II")
   on behalf of its Series
      Van Kampen Tax Managed Equity Growth Fund

   Van Kampen Pennsylvania Tax Free Income Fund ("Pennsylvania Tax Free Income
   Fund")
   Van Kampen Tax Free Money Fund ("Tax Free Money Fund")

II. FUNDS ADVISED BY VAN KAMPEN ASSET MANAGEMENT INC.
    (COLLECTIVELY, THE "ASSET MANAGEMENT FUNDS")

   Van Kampen Comstock Fund ("Comstock Fund")
   Van Kampen Corporate Bond Fund ("Corporate Bond Fund")
   Van Kampen Emerging Growth Fund ("Emerging Growth Fund")
   Van Kampen Enterprise Fund ("Enterprise Fund")
   Van Kampen Equity Income Fund ("Equity Income Fund")



                                       4
<PAGE>

   Van Kampen Global Managed Assets Fund ("Global Managed Assets Funds")
   Van Kampen Government Securities Fund ("Government Securities Fund")
   Van Kampen Growth and Income Fund ("Growth and Income Fund")
   Van Kampen Harbor Fund ("Harbor Fund")
   Van Kampen High Income Corporate Bond Fund ("High Income Corporate Bond
   Fund")

   Van Kampen Life Investment Trust ("Life Investment Trust" or "LIT")
   on behalf of its Series
      Enterprise Portfolio ("LIT Enterprise Portfolio")
      Domestic Income Portfolio ("LIT Domestic Income Portfolio")
      Emerging Growth Portfolio ("LIT Emerging Growth Portfolio")
      Global Equity Portfolio ("LIT Global Equity Portfolio")
      Government Portfolio ("LIT Government Portfolio")
      Asset Allocation Portfolio ("LIT Asset Allocation Portfolio")
      Money Market Portfolio ("LIT Money Market Portfolio")
      Morgan Stanley Real Estate Securities Portfolio ("LIT Morgan Stanley Real
      Estate Securities Portfolio")
      Growth and Income Portfolio ("LIT Growth and Income Portfolio")
      Strategic Stock Portfolio ("LIT Strategic Stock Portfolio")
      Comstock Portfolio ("LIT Comstock Portfolio")

   Van Kampen Limited Maturity Government Fund ("Limited Maturity Government
   Fund")
   Van Kampen Pace Fund ("Pace Fund")
   Van Kampen Real Estate Securities Fund ("Real Estate Securities Fund")
   Van Kampen Reserve Fund ("Reserve Fund")

   Van Kampen Tax-Exempt Trust ("Tax-Exempt Trust")
   on behalf of its Series
     Van Kampen High Yield Municipal Fund ("High Yield Municipal Fund")

   Van Kampen Equity Trust II ("Equity Trust II")
   on behalf of its Series
     Van Kampen Technology Fund

   Van Kampen U.S. Government Trust for Income ("U.S. Government Trust for
   Income")

                                       5
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(14)
<SEQUENCE>21
<FILENAME>c93084a1exv99wx14y.txt
<DESCRIPTION>CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
<TEXT>
<PAGE>

                                                                      EXHIBIT 14


            CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


We consent to the use in this Pre-Effective Amendment No. 1 to Registration
Statement No. 333-123451 on Form N-14 under the Securities Act of 1933, of our
reports dated December 10, 2004, appearing in the Annual Reports of Van Kampen
Municipal Trust and Van Kampen Investment Grade Municipal Trust, for the year
ended October 31, 2004, included in the Statement of Additional Information
which is part of such Registration Statement, and to the references to us under
the headings "Independent Registered Public Accounting Firm" and "Form of
Agreement and Plan of Reorganization" included in the Statement of Additional
Information.



/S/ DELOITTE & TOUCHE LLP

Chicago, Illinois
May 3, 2005


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(16)
<SEQUENCE>22
<FILENAME>c93084a1exv99wx16y.txt
<DESCRIPTION>POWER OF ATTORNEY
<TEXT>
<PAGE>
                                                                      EXHIBIT 16


                               POWER OF ATTORNEY
                               -----------------

The undersigned,

1)       being officers and trustees/directors of:

         a)       each of the Van Kampen Open-End Trusts (the "Delaware Open-End
                  Trusts") as indicated on Schedule 1 attached hereto and
                  incorporated by reference, each a Delaware statutory trust,

         b)       the Van Kampen Pennsylvania Tax Free Income Fund (the
                  "Pennsylvania Open-End Trust"), a Pennsylvania trust, and

         c)       the Van Kampen Series Fund, Inc. (the "Corporation"), a
                  Maryland corporation, (collectively, the Delaware Open-End
                  Trusts, Pennsylvania Open-End Trust, and the Corporation are
                  referred to herein as the "Open-End Funds");

         d)       each of the Van Kampen Closed-End Trusts (the "Massachusetts
                  Closed-End Trusts") as indicated on Schedule 2 attached hereto
                  and incorporated by reference, each a Massachusetts business
                  trust,

         e)       each of the Van Kampen Income Trust and Van Kampen Bond Fund
                  (the "Delaware Closed-End Trusts"), each a Delaware statutory
                  trust,

         f)       each of the Van Kampen Pennsylvania Quality Municipal Trust,
                  Van Kampen Trust for Investment Grade Pennsylvania Municipals,
                  Van Kampen Advantage Pennsylvania Municipal Income Trust and
                  Van Kampen Pennsylvania Value Municipal Income Trust (the
                  "Pennsylvania Closed-End Trusts"), each a Pennsylvania trust
                  (collectively, the Massachusetts Closed-End Trusts, Delaware
                  Closed-End Trusts and Pennsylvania Closed-End Trusts are
                  referred to herein as the "Closed-End Funds");

2)       being officers and trustees, with the exception of Jerry D. Choate,
         Linda Hutton Heagy, R. Craig Kennedy, Mitchell M. Merin (Mr. Merin is
         president but not a trustee), Jack E. Nelson and Suzanne H. Woolsey,
         of:

         a)       each of the Van Kampen Senior Income Trust and Van Kampen
                  Senior Loan Fund (the "Senior Loan Funds"), each a
                  Massachusetts business trust;

3)       being officers and managing general partners of:

         a)       the Van Kampen Exchange Fund (the "Exchange Fund"), a
                  California Limited Partnership (collectively, the Open-End
                  Funds, Closed-End Funds, Senior Loan Funds and Exchange Fund
                  are referred to herein as the "Funds")


do hereby, in the capacities shown below, appoint Stefanie Chang Yu, Amy
Doberman and Lou Anne McInnis each of New York, New York, as agents and
attorneys-in-fact with full power of substitution and resubstitution, for each
of the undersigned, as fully to all intents as he or she might or could do in
person, for the purposes to execute and deliver, for and on behalf of the
undersigned, any Registration Statement on Form N-1A of the Open-End Funds or
Exchange Fund (including any and all amendments thereto), any Registration
Statement on Form N-2 of the Closed-End Funds or Senior Loan Funds (including
any and all amendments thereto), any Registration Statement on Form N-14 of the
Funds (including any and all amendments thereto) and any other document, upon
the advice of counsel, filed by each Fund with the Securities and Exchange
Commission pursuant to the provisions of the Securities Act of 1933, the
Securities Exchange Act of 1934 and the Investment Company Act of 1940.


<PAGE>


         This Power of Attorney may be executed in multiple counterparts, each
of which shall be deemed an original, but which taken together shall constitute
one instrument.

Dated: January 26, 2005


<TABLE>
<CAPTION>

        Signature                                               Title
        ---------                                               -----
<S>                                     <C>

/s/ Mitchell M. Merin
- ------------------------------          President and Trustee/Director/Managing General Partner
        Mitchell M. Merin

/s/ Ronald E. Robison
- ------------------------------          Executive Vice President and Principal Executive Officer
        Ronald E. Robison

/s/ James W. Garrett
- ------------------------------          Chief Financial Officer and Treasurer
        James W. Garrett

/s/ David C. Arch
- ------------------------------          Trustee/Director/Managing General Partner
        David C. Arch

/s/ Jerry D. Choate
- ------------------------------          Trustee/Director/Managing General Partner
        Jerry D. Choate

/s/ Rod Dammeyer
- ------------------------------          Trustee/Director/Managing General Partner
        Rod Dammeyer

/s/ Linda Hutton Heagy
- ------------------------------          Trustee/Director/Managing General Partner
        Linda Hutton Heagy

/s/ R. Craig Kennedy
- ------------------------------          Trustee/Director/Managing General Partner
        R. Craig Kennedy

/s/ Howard J Kerr
- ------------------------------          Trustee/Director/Managing General Partner
        Howard J Kerr

/s/ Jack E. Nelson
- ------------------------------          Trustee/Director/Managing General Partner
        Jack E. Nelson

/s/ Richard F. Powers, III
- ------------------------------          Trustee/Director/Managing General Partner
        Richard F. Powers, III

/s/ Hugo F. Sonnenschein
- ------------------------------          Trustee/Director/Managing General Partner
        Hugo F. Sonnenschein

/s/ Wayne W. Whalen
- ------------------------------          Trustee/Director/Managing General Partner
        Wayne W. Whalen

/s/ Suzanne H. Woolsey
- ------------------------------          Trustee/Director/Managing General Partner
        Suzanne H. Woolsey


</TABLE>

<PAGE>


                                   SCHEDULE 1
                                   ----------


VAN KAMPEN U.S. GOVERNMENT TRUST
VAN KAMPEN TAX FREE TRUST
VAN KAMPEN TRUST
VAN KAMPEN EQUITY TRUST
VAN KAMPEN EQUITY TRUST II
VAN KAMPEN TAX FREE MONEY FUND
VAN KAMPEN COMSTOCK FUND
VAN KAMPEN CORPORATE BOND FUND
VAN KAMPEN EMERGING GROWTH FUND
VAN KAMPEN ENTERPRISE FUND
VAN KAMPEN EQUITY AND INCOME FUND
VAN KAMPEN GOVERNMENT SECURITIES FUND
VAN KAMPEN GROWTH AND INCOME FUND
VAN KAMPEN HARBOR FUND
VAN KAMPEN HIGH YIELD FUND
VAN KAMPEN LIFE INVESTMENT TRUST
VAN KAMPEN LIMITED DURATION FUND
VAN KAMPEN PACE FUND
VAN KAMPEN REAL ESTATE SECURITIES FUND
VAN KAMPEN RESERVE FUND
VAN KAMPEN TAX-EXEMPT TRUST

                                   SCHEDULE 2
                                   ----------

VAN KAMPEN MUNICIPAL INCOME TRUST
VAN KAMPEN CALIFORNIA MUNICIPAL TRUST
VAN KAMPEN HIGH INCOME TRUST
VAN KAMPEN HIGH INCOME TRUST II
VAN KAMPEN INVESTMENT GRADE MUNICIPAL TRUST
VAN KAMPEN MUNICIPAL TRUST
VAN KAMPEN CALIFORNIA QUALITY MUNICIPAL TRUST
VAN KAMPEN FLORIDA QUALITY MUNICIPAL TRUST
VAN KAMPEN NEW YORK QUALITY MUNICIPAL TRUST
VAN KAMPEN OHIO QUALITY MUNICIPAL TRUST
VAN KAMPEN TRUST FOR INSURED MUNICIPALS
VAN KAMPEN TRUST FOR INVESTMENT GRADE MUNICIPALS
VAN KAMPEN TRUST FOR INVESTMENT GRADE CALIFORNIA MUNICIPALS
VAN KAMPEN TRUST FOR INVESTMENT GRADE FLORIDA MUNICIPALS
VAN KAMPEN TRUST FOR INVESTMENT GRADE NEW JERSEY MUNICIPALS
VAN KAMPEN TRUST FOR INVESTMENT GRADE NEW YORK MUNICIPALS
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
VAN KAMPEN ADVANTAGE MUNICIPAL INCOME TRUST
VAN KAMPEN STRATEGIC SECTOR MUNICIPAL TRUST
VAN KAMPEN VALUE MUNICIPAL INCOME TRUST
VAN KAMPEN CALIFORNIA VALUE MUNICIPAL INCOME TRUST
VAN KAMPEN MASSACHUSETTS VALUE MUNICIPAL INCOME TRUST
VAN KAMPEN NEW YORK VALUE MUNICIPAL INCOME TRUST
VAN KAMPEN OHIO VALUE MUNICIPAL INCOME TRUST
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST II
VAN KAMPEN ADVANTAGE MUNICIPAL INCOME TRUST II
VAN KAMPEN SELECT SECTOR MUNICIPAL TRUST


<PAGE>
                                                                      APPENDIX A

Approval of Authorization

RESOLVED, that Mr. Ronald E. Robison and Mr. James W. Garrett, Principal
Executive Officer and Chief Financial Officer, respectively, be and they hereby
are authorized to sign any registration statement or any supplement or amendment
thereto (a "Registration Statement") on behalf of the Funds pursuant to a power
of attorney, dated January 26, 2005, granted to each of the attorneys-in-fact
referenced therein; and

FURTHER RESOLVED, that the execution and filing of any Registration Statement
and the performance of such acts by such attorneys-in-fact shall be conclusive
evidence of approval thereof and authority therefore from each Fund and the
approval by each Fund of the documents so filed or action so taken.

Pursuant to the requirement of Rule 483 of the Securities Act of 1933, as
amended, the undersigned hereby certifies that the above resolutions were
approved by the Board of Trustees or Directors of the Funds on March 3, 2005.

/s/ Stefanie Chang Yu
- ---------------------
Stefanie Chang Yu
Secretary
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(17)(A)
<SEQUENCE>23
<FILENAME>c93084a1exv99wx17yxay.txt
<DESCRIPTION>CODE OF ETHICS OF THE INVESTMENT ADVISOR
<TEXT>
<PAGE>
                                                                  EXHIBIT 17(a)

[MORGAN STANLEY LOGO]


                      MORGAN STANLEY INVESTMENT MANAGEMENT
                                 CODE OF ETHICS

Effective June 15, 2004



- ---------------------------
(Print Name)

         The investment advisors, advisors, distribution companies and related
service companies listed on the attached Schedule A that operate within Morgan
Stanley Investment Management (each, a "Covered Company" and collectively,
"Investment Management") have adopted this Code of Ethics (the "Code"). The
principal objectives of the Code are (i) to provide policies and procedures
consistent with applicable law and regulation, including Rule 17j-1 under the
Investment Company Act of 1940, as amended (the "1940 Act"), and Section 204 A
of the Investment Advisers Act of 1940, as amended (the "Advisers Act"), and
(ii) make certain that the personal trading and other business activities of
Employees of Investment Management (defined in Section III. below) are conducted
in a manner consistent with applicable law and regulation and the general
principles set forth in the Code.

         Employees of Investment Management are also subject to the "Morgan
Stanley Code of Conduct -- Securities and Asset Management Businesses" (the
"Code of Conduct"), and the Morgan Stanley Code of Ethics and Business
Practices, which can be found on the Law Portal of the Morgan Stanley Today
intranet site. Employees are reminded that they are also subject to other Morgan
Stanley Investment Management policies, including policies on insider trading,
the receipt of gifts, the handling of all internally distributed proprietary and
confidential information, Morgan Stanley Investment Management Senior Loan
Firewall Procedures, and service as a director of a publicly traded company. All
internally distributed information is proprietary and confidential information
and should not be discussed with people outside of Morgan Stanley Investment
Management or shared with anybody outside of the Investment Department.

                                       i
<PAGE>




[MORGAN STANLEY LOGO]


                                    TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                        Page
                                                                                        ----

<S>     <C>                                                                             <C>
I.      Policy Highlights..................................................................1

II.     General Principles.................................................................2
        A.     Shareholder and Client Interests Come First.................................2
        B.     Avoid Actual and Potential Conflicts of Interest............................3

III.    Definitions........................................................................3
        A.     Access Persons..............................................................3
        B.     Covered Accounts............................................................3
        C.     Covered Securities..........................................................4
        D.     Investment Personnel........................................................4

IV.     Grounds for Disqualification from Employment.......................................4

V.      Personal Securities Transactions...................................................5
        A.     Prohibited Conduct..........................................................5
        B.     Restrictions and Limitations on Personal Securities Transactions............5
        C.     Exempt Securities...........................................................9
        D.     Pre-Clearance Requirement..................................................10
        E.     Permitted Brokerage Accounts and Accounts Holding Morgan Stanley/
                 Van Kampen Funds.........................................................13

VI.     Reporting Requirements............................................................15
        A.     Report of Transactions.....................................................15
        B.     Form of Reporting..........................................................17
        C.     Responsibility to Report...................................................18
        D.     Leave of Absence...........................................................18
        E.     Where to File Report.......................................................18
        F.     Responsibility to Review...................................................18

VII.    Code of Ethics Review Committee...................................................19

VIII.   Service as a Director and Outside Business Activities.............................19

IX.     Gifts.............................................................................19

X.      Sanctions.........................................................................20

XI.     Employee Certification............................................................20
</TABLE>

                                       ii


<PAGE>


[MORGAN STANLEY LOGO]


I.       Policy Highlights

         The Code is designed so that all acts, practices and courses of
         business engaged in by employees are conducted in accordance with the
         highest possible standards and to prevent abuses or even the appearance
         of abuses by Employees relating to their personal trading and other
         business activity. Compliance with the Code is a matter of
         understanding the basic requirements and making sure the steps the
         employee takes with respect to each personal securities transaction and
         his/her personal investment is in accordance with these requirements.
         This Section sets forth selected rules that frequently raise questions.
         These are by no means comprehensive and Employees must examine the
         specific sections of the Code for more details and are strongly urged
         to consult Compliance when questions arise:

         o     Shares of Morgan Stanley/Van Kampen open-end investment companies
               ("Affiliated Mutual Funds"), whether purchased, sold or exchanged
               in a brokerage account, directly through a transfer agent or in a
               401(k) or other retirement plan, including the Morgan Stanley
               401(k) plan, are exempt from pre-clearance requirements but are
               subject to holding and reporting requirements. AFFILIATED MUTUAL
               FUNDS MAY NOT BE SOLD, REDEEMED OR EXCHANGED UNTIL AT LEAST 60
               CALENDAR DAYS FROM THE PURCHASE TRADE DATE. SHARES IN THE SAME
               MUTUAL FUND MAY NOT BE REPURCHASED UNTIL AT LEAST 60 CALENDAR
               DAYS FROM THE SALE TRADE DATE. INVESTMENT PERSONNEL, DEFINED
               HEREIN, MAY NOT SELL, REDEEM OR EXCHANGE AFFILIATED MUTUAL FUNDS
               UNTIL AT LEAST 90 CALENDAR DAYS FROM THE PURCHASE TRADE DATE AND
               ARE SUBJECT TO THE REPURCHASE RESTRICTIONS ABOVE;

         o     Purchases and sales of shares in money market funds, including
               Morgan Stanley/Van Kampen money market funds, continue to be
               exempt from preclearance, minimum holding period and reporting
               requirements of the Code;

         o     Employees must maintain brokerage accounts at Morgan Stanley
               unless an exception is granted. All accounts for the purchase of
               Affiliated Mutual Funds must be pre-approved by the Compliance
               Department before opening;

         o     All Personal Securities Transactions must be pre-cleared through
               Compliance, except as set forth herein;

         o     Employees may only transact in MWD stock during designated window
               periods and all transactions must be pre-cleared. The
               restrictions imposed by Morgan Stanley on Senior Management and
               other persons in connection with transactions in MWD stock are in
               addition to this Code, and must be observed to the extent
               applicable;

         o     Exchange Traded Funds ("ETFs") and closed-end mutual funds must
               be pre-cleared and are subject to all other holding and reporting
               requirements;

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         o     Employees are prohibited from acquiring any security in an
               initial public offering (IPO) or any other public underwriting;

         o     Private placements, participation on the Board of any company and
               any outside business activities must be pre-approved by the Code
               of Ethics Review Committee;

         o     Employees may not sell Covered Securities under any circumstances
               unless they have been held for at least 30 days and they may not
               be sold at a profit until at least 60 calendar days from the
               purchase trade date;

         o     Employees may not repurchase any security sold by the Employee
               within the previous 30 days and may not repurchase such security
               within the previous 60 days if the purchase price is lower than
               any sale price within the 60-day period;

         o     Portfolio managers and research analysts and those who report to
               them, may not trade in a security if accounts they manage trade
               in the same security within the 7 days prior to or 7 days
               following the Employee's transaction;

         o     Employees are required to submit an Initial Holdings Report upon
               hire, Quarterly Transactions Reports and an Annual Report and
               Compliance Certification.


II.      General Principles

         A.    Shareholder and Client Interests Come First

               Every Employee owes a fiduciary duty to the shareholders of
               registered investment companies (each; a "Fund" and collectively,
               the "Funds") and to the Managed Account Clients (defined as
               clients other than registered investment companies including
               unregistered investment companies, institutional clients and
               individuals). This means that in every decision relating to
               investments, every Employee must recognize the needs and
               interests of the Fund shareholders and the Managed Account
               Clients, and be certain that at all times the interests of the
               Fund shareholders and other Managed Account Clients are placed
               ahead of any personal interest.

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         B.    Avoid Actual and Potential Conflicts of Interest

               The restrictions and requirements of the Code are designed to
               prevent behavior which actually or potentially conflicts, or
               raises the appearance of an actual or potential conflict, with
               the interests of the Fund shareholders or the Managed Account
               Clients. It is of the utmost importance that the Personal
               Securities Transactions of Employees be conducted in a manner
               consistent with both the letter and spirit of the Code to avoid
               any such conflict of interest and to prevent abuse of an
               Employee's position of trust and responsibility.

III.     Definitions

         A.    "Access Persons" shall include all directors, officers, and
               employees of Investment Management as well as certain other
               persons falling within such definition under Rule 17j-1 under the
               1940 Act and such other persons that may be so deemed by each
               Local Compliance Group from time to time, except those persons
               who are not officers and directors of an investment adviser under
               Investment Management and who meet the following criteria: (i)
               directors and officers of Morgan Stanley Distributors Inc.,
               Morgan Stanley Distribution Inc., Morgan Stanley & Co., and Van
               Kampen Funds Inc. (each a "Distributor" and collectively, the
               "Distributors") that do not devote substantially all of their
               working time to the activities (including distribution
               activities) of an investment adviser under Morgan Stanley
               Investment Management; (ii) directors and officers of the
               Distributors that do not, in connection with their regular
               functions and duties, participate in, obtain information with
               respect to, or make recommendations as to, or purchase and sell
               securities on behalf of a Fund or a Managed Account Client; and
               (iii) directors and officers of the Distributors that do not have
               access to information regarding the day-to-day investment
               activities of Investment Management shall not be deemed Access
               Persons. Such persons are, however, subject to the Code of
               Conduct. The Local Compliance Group for each Covered Company will
               identify all Access Persons of Investment Management and notify
               them of their pre-clearance and reporting obligations at the time
               they become an Access Person. Access Persons will be referred to
               as "Employees" throughout the Code. Employees with questions
               concerning their status as Access Persons are urged to consult
               with their Local Compliance Group.

         B.    "Covered Accounts" shall include any account in which an
               Employee has, or acquires any direct or indirect beneficial
               ownership in a security held in the account. Generally, an
               employee is regarded as having beneficial ownership of securities
               held in an account in the name of: (1) the individual; (2) a
               husband, wife or minor child; (3) a relative sharing the same
               house; (4) another person if the Employee obtains benefits
               substantially equivalent to ownership of the

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               securities; (ii) can obtain ownership of the securities
               immediately or at some future time; or (iii) can have investment
               discretion or otherwise can exercise control. In addition, as
               described in the Code, certain circumstances constitute
               Beneficial Ownership by an Employee of securities held by a
               trust.

         C.    "Covered Securities" shall include all securities, any option to
               purchase or sell, and any security convertible into or
               exchangeable for such securities. For example, Covered Securities
               also include, but are not limited to individual securities,
               open-end mutual funds, exchange traded funds, closed-end funds
               and unit investment trusts. Exemption from certain requirements
               of the Code may apply to designated Covered Securities, as set
               forth below. In addition, certain securities, such as money
               market funds, are exempt from the definition of "Covered
               Security" as explained in the Code.

         D.    "Investment Personnel" shall mean any Investment Management
               Employee who, in connection with his or her regular functions or
               duties, makes or participates in making recommendations regarding
               the purchase or sale of securities or anyone who, in connection
               with their job functions, has real-time knowledge of such
               recommendations. This includes, but is not limited to, portfolio
               managers, research analysts, and all persons reporting to
               portfolio managers and research analysts and personnel in the
               trading department, among others.

IV.      Grounds for Disqualification from Employment

         Pursuant to the terms of Section 9 of the 1940 Act, no director,
         officer or employee of a Covered Company, as listed in Schedule A may
         become, or continue to remain, an officer, director or employee without
         an exemptive order issued by the U.S. Securities and Exchange
         Commission if such director, officer or employee:

         o     within the past ten years has been convicted of any felony or
               misdemeanor (i) involving the purchase or sale of any security;
               or (ii) arising out of their conduct as an underwriter, broker,
               dealer, investment adviser, municipal securities dealer,
               government securities broker, government securities dealer,
               transfer agent, or entity or person required to be registered
               under the U.S. Commodity Exchange Act, or as an affiliated
               person, salesman or employee of any investment company, bank,
               insurance company or entity or person required to be registered
               under the Commodity Exchange Act; or

         o     is or becomes permanently or temporarily enjoined by any court
               from: (i) acting as an underwriter, broker, dealer, investment
               adviser, municipal securities dealer, government securities
               broker, government securities dealer, transfer agent, or entity
               or person required to be registered under the U.S. Commodity
               Exchange Act, or as an affiliated person, salesman or employee of
               any investment company,

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               bank, insurance company or entity or person required to be
               registered under the U.S. Commodity Exchange Act; or (ii)
               engaging in or continuing any conduct or practice in connection
               with any such activity or in connection with the purchase or sale
               of any security.

         It is your obligation to immediately report any conviction or
         injunction falling within the foregoing provisions to the Chief Legal
         or Compliance Officer of Investment Management.

V.       Personal Securities Transactions

         A.    Prohibited Conduct

               No Employee shall buy or sell any Covered Security (with the
               exception of those described in sub-section C. below) for a
               Covered Account (referred to herein as a "Personal Securities
               Transaction") unless:



               1.   pre-clearance of the transaction has been obtained; and the

               2.   transaction is reported in writing to the Local Compliance
                    Group in accordance with the requirements below.


         B.    Restrictions and Limitations on Personal Securities Transactions

               Except where otherwise indicated, the following restrictions and
               limitations govern Personal Securities Transaction:

               1.   Covered Securities purchased may not be sold until at least
                    30 calendar days from the purchase trade date and may not be
                    sold at a profit until at least 60 calendar days from the
                    purchase trade date. Covered Securities sold may not be
                    repurchased until at least 30 calendar days from the sale
                    trade date. In addition, Covered Securities sold may not be
                    purchased at a lower price until at least 60 calendar days
                    from the sale trade date. Any violation may result in
                    disgorgement of all profits from the transactions as well as
                    other possible sanctions.

               2.   Morgan Stanley/Van Kampen open-end Mutual Funds (excluding
                    money market funds), whether purchased in a brokerage
                    account, directly through a transfer agent or in a 401(k) or
                    other retirement plan, may not be sold, redeemed or
                    exchanged until at least 60 calendar days from the purchase
                    trade date. They may not be repurchased until at least 60
                    calendar days from the sale trade date. Investment Personnel
                    may not sell, redeem or exchange such mutual funds until at
                    least 90 calendar days from the purchase trade date and are
                    subject to the repurchase restrictions above;





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                    In the event of financial hardship, exceptions to this
                    section of the Code may be granted, but only with the prior
                    written approval of a Compliance Officer and the Employee's
                    supervisor and if the transaction is consistent with each
                    Fund prospectus.

               3.   No short sales are permitted.

               4.   No transactions in options or futures are permitted, except
                    that listed options may be purchased, and covered calls
                    written. No option may be purchased or written if the
                    expiration date is less than 60 calendar days from the date
                    of purchase. No option position may be closed at a profit
                    less than 60 calendar days from the date it is established.

               5.   No Employee may acquire any security in an initial public
                    offering (IPO) or any other public underwriting. No Employee
                    shall purchase shares of a Fund that is managed by a Covered
                    Company if such Fund is not generally available to the
                    public, unless the vehicle is designed for Morgan Stanley
                    employees and there is no intention of it becoming public in
                    the future.

               6a.  Private placements of any kind may only be acquired with
                    special permission from the Code of Ethics Review Committee
                    and if approved, will be subject to monitoring by the Local
                    Compliance Group. Any Employee wishing to request approval
                    for private placements must complete a Private Placement
                    Approval Request Form and submit the form to the Local
                    Compliance Group. A copy of the Private Placement Approval
                    Request Form, which may be revised from time to time, is
                    attached as EXHIBIT A. Where the Code of Ethics Review
                    Committee approves any acquisition of a private placement,
                    its decision and reasons for supporting the decision will be
                    documented in a written report, which is to be kept for five
                    years by the Local Compliance Group after the end of the
                    fiscal year in which the approval was granted.

               6b.  Any Employee who has a personal position in an issuer
                    through a private placement must affirmatively disclose that
                    interest if such employee is involved in considering any
                    subsequent investment decision by a Fund or Managed Account
                    regarding any security of that issuer or its affiliate(s).
                    In such event, the President or Chief Investment Officer of
                    Investment Management shall independently determine the
                    final investment decision. Written records of any such
                    circumstance shall be sent to the Local Compliance Group and
                    maintained for a period of five years after the end of the
                    fiscal year in which the approval was granted.


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                    Restrictions 7.a. and 7.b. apply only to portfolio managers
                    and research analysts (and all persons reporting to
                    portfolio managers and research analysts) of Investment
                    Management.

               7a.  No purchase or sale transaction may be made in any Covered
                    Security by any portfolio manager or research analyst (or
                    person reporting to a portfolio manager or research analyst)
                    for a period of 7 calendar days before or after that Covered
                    Security is bought or sold by any Fund (other than Morgan
                    Stanley Value-Added Market Series, Morgan Stanley Select
                    Dimensions Investment Series -- Value-Added Market
                    Portfolio, and Morgan Stanley index funds, or Portfolios) or
                    any Managed Account (other than index-based Managed
                    Accounts) for which such portfolio manager or research
                    analyst (or person reporting to a portfolio manager or
                    research analyst) serves in that capacity.

               7b.  The definition of portfolio manager shall also extend to any
                    person involved in determining the composition of the
                    portfolios of Funds that are UITs or who have knowledge of a
                    composition of a UIT portfolio prior to deposit. These
                    individuals shall not buy or sell a Covered Security within
                    7 calendar days before or after such Covered Security is
                    included in the initial deposit of a UIT portfolio.

               Restriction 7.c. applies only to personnel in the trading
               department of each Covered Company.

               7c.  No purchase or sale transaction may be made in any Covered
                    Security traded through the appropriate Covered Company's
                    trading desk(s) (as determined by the Local Compliance
                    Group) by any person on that trading desk at the same time
                    that any Fund (other than Morgan Stanley Value-Added Market
                    Series, Morgan Stanley Select Dimensions Investment
                    Series--Value-Added Market Portfolio, and Morgan Stanley
                    index funds, or Portfolios) or any Managed Account (other
                    than index-based Managed Accounts) has a pending purchase or
                    sale order in that same Covered Security.

               7d.  Any transaction by persons described in sub-sections 7.a.,
                    7.b., and 7.c. above within such enumerated period may be
                    required to be reversed, if applicable, and any profits or,
                    at the discretion of the Code of Ethics Review Committee,
                    any differential between the sale price of the Personal
                    Security Transaction and the subsequent purchase or sale
                    price by a relevant Fund or Managed Account during the
                    enumerated period, will be subject to disgorgement; other
                    sanctions may also be applied.

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               8.   No Employee shall purchase or sell any Covered Security
                    which to their knowledge at the time of such purchase or
                    sale: (i) is being considered for purchase or sale by a Fund
                    or a Managed Account; or (ii) is being purchased or sold by
                    a Fund or a Managed Account. With respect to portfolio
                    managers and research analysts (and all persons reporting to
                    portfolio managers and research analysts) of a Covered
                    Company, no such persons may purchase shares of a closed-end
                    investment company over which such person exercises
                    investment discretion.

               9.   If a Personal Securities Transaction is not executed on the
                    day pre-clearance is granted, it is required that
                    pre-clearance be sought again on a subsequent day (i.e.,
                    open orders, such as limit orders, good until cancelled
                    orders and stop-loss orders, must be pre-cleared each day
                    until the transaction is effected).(1)

               10.  Employees shall not participate in investment clubs.

               11.  Employees may only transact in MWD stock during designated
                    window periods. Also, such transactions must be pre-cleared
                    with Compliance. Holdings and transactions in MWD stock are
                    subject to the initial, quarterly and annual reporting
                    requirements as well as the 30-day holding period
                    restriction and the 60-day short swing profit
                    restriction(2). The restrictions imposed by Morgan Stanley
                    on Senior Management and other persons in connection with
                    transactions in MWD stock are in addition to this Code, and
                    must be observed to the extent applicable. Employees are
                    required to read the Code of Conduct for a listing of
                    specific restrictions and limitations relating to the
                    purchase or sale of MWD stock. Employees receiving MWD stock
                    or options through EICP and other plans may be subject to
                    certain trading restrictions and exemptions. Employees
                    should check Employment documents and consult with
                    compliance to address any questions.

               Important: Regardless of the limited applicability of
               Restrictions 7.a., 7.b., and 7.c. each Local Compliance Group
               monitors all transactions by Employees in all locations in order
               to ascertain any pattern of conduct that may evidence actual or
               potential conflicts with the principles and objectives of the
               Code, including a pattern of front-running. The Compliance Group
               of each Covered Company: (i) on a quarterly basis, will provide
               the Boards of Directors/Trustees of the Funds it manages with a
               written report that describes any issues that arose during the
               previous quarter under the Code and, if applicable, any Funds'
               Sub-Adviser's Code of Ethics, including but not limited to,
               information about material violations

- ----------
(1) In the case of trades in institutional markets where the market has already
closed, transactions must be executed by the next close of trading in that
market.

(2) In connection with the sale of MWD stock, periodic purchases through
employee sponsored equity purchase plans shall not be counted when calculating
the 30-day holding period restriction or the 60-day short swing profit
restriction.

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         and sanctions imposed in response to the material violations; and (ii)
         on an annual basis, will certify that each Covered Company has adopted
         procedures reasonably necessary to prevent its Employees from violating
         the Code. Also, as stated elsewhere in this Code, any violation of the
         foregoing restrictions may result in disgorgement of all profits from
         the transactions as well as other possible sanctions.

C.       Exempt Securities

         1.    The securities listed below are exempt from: (i) the holding
               period and other restrictions of this Section V., sub-sections
               B.1., B.2., B. 7a-d. and B.8.; (ii) the pre-clearance
               requirements; and (iii) the initial, quarterly and annual
               reporting requirements. Accordingly, it is not necessary to
               obtain pre-clearance for Personal Securities Transactions in any
               of the following securities, nor is it necessary to report such
               securities in the quarterly Transaction Reports or the Initial
               Holdings Report and Annual Compliance Certification:

               (a)  Direct obligations of the United States Government(3);
               (b)  Bank Certificates of Deposit;
               (c)  Bankers' Acceptances;
               (d)  Commercial Paper; and
               (e)  High Quality Short-Term Debt Instruments (which for these
                    purposes are repurchase agreements and any instrument that
                    has a maturity at issuance of fewer than 366 days that is
                    rated in one of the two highest categories by a Nationally
                    Recognized Statistical Rating Organization).
               (f)  Shares held in money market funds, including Morgan
                    Stanley/Van Kampen money market funds.
               (g)  Shares held in non-affiliated open-end Mutual Funds.

         2.    Transactions in redeemable Unit Investment Trusts are exempt from
               the restrictions contained in this Section V., sub-sections B.1.
               and B.7 and the pre-clearance requirement of Section V.,
               sub-section A., but are subject to the reporting requirements of
               Section VI., sub-section A.

         3.    Shares of Morgan Stanley/Van Kampen open-end mutual funds are
               exempt from the pre-clearance requirement of Section V,
               sub-section A, but are subject to the account opening
               restrictions of Section V, sub-section E, initial, quarterly and
               annual reporting requirements of Section VI,

- ----------
(3) Includes securities that carry full faith and credit of the U.S. Government
for the timely payment of principal and interest, such as Ginnie Maes, U.S.
Savings Bonds, and U.S. Treasuries. For international offices, the equivalent
shares in fixed income securities issued by the government of their respective
jurisdiction; however such securities are subject to the initial and annual
reporting requirements of sub-section D.

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         and the holding period restrictions contained in Section V, sub-section
         B. Exchange Traded Funds ("ETFs") and closed-end funds must be
         pre-cleared and are subject to all other reporting requirements.

4.       All Employees wishing to participate in an issuer's direct stock
         purchase plan or automatic dividend reinvestment plans must submit a
         memorandum to the Local Compliance Group stating the name and the
         amount to be invested in the plan. Any sale transactions from an
         automatic dividend reinvestment plan must be pre-cleared. Purchases
         under an issuer's direct stock purchase plan or automatic dividend
         reinvestment plan are exempt from the restrictions contained in this
         Section V, sub-sections B.1., B.7a-d. and B.8. and the pre-clearance
         requirement but are subject to the reporting requirements.

5.       Transactions in Morgan Stanley and Van Kampen mutual funds within the
         Morgan Stanley 401(k) Plan(4) are exempt from the pre-clearance
         requirement of Section V. sub-section A, but are subject to the
         initial, quarterly and annual reporting requirements of Section VI. and
         the holding period restrictions contained in Section V, sub-section B.

6.       Employees may maintain fully discretionary managed accounts provided
         that each of the following conditions are met: (i) the investment
         program is offered by Morgan Stanley; (ii) the portfolio manager's
         strategy/investment discipline/investment program offered/utilized is
         the same for both Employee and non-Employee client accounts; (iii)
         written permission is obtained from the Director of Compliance and the
         Chief Investment Officer (or their designees) prior to opening a fully
         discretionary account; (iv) written certification is obtained stating
         that there will be no communication between the portfolio manager and
         the Employee with regard to investment decisions prior to execution;
         and (v) Employee accounts will be treated no differently from
         non-Employee accounts. The Employee must designate duplicate copies of
         trade confirmations and statements to be sent to the Compliance
         Department. To the extent that an Employee directs trades for tax
         purposes, that Employee shall obtain pre-clearance for each transaction
         from his/her Local Compliance Group.


D.       Pre-Clearance Requirement

         1.    Personal Securities Transactions

               (a)      From Whom Obtained


- ----------
(4) This includes Morgan Stanley Retirement Plans that are equivalent to 401(k)
Plans in jurisdictions outside the United States.

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                        All Employees are required to obtain pre-clearance of
                        Personal Securities Transactions in Covered Securities.
                        Employees must complete the required Form, as described
                        below, and submit it to the Compliance Department for
                        approval.

                        A copy of the Personal Securities Transaction Approval
                        Form, which may be revised from time to time, is
                        attached as EXHIBIT B.

               (b)      Personal Securities Transaction Approval Process

                        Pre-clearance must be obtained by completing and signing
                        the Personal Securities Transaction Approval Form and
                        obtaining the proper pre-clearance signatures. The
                        Approval Form must also indicate, as applicable, the
                        name of the individual's financial advisor, the branch
                        office numbers, as well as other required information.

                        If an Employee has more than one Covered Account, the
                        Employee must indicate for which Covered Account the
                        trade is intended on the Personal Securities Transaction
                        Approval Form. Employees are required to have duplicate
                        copies of their trade confirmations and Covered Account
                        statements (which can be electronically transmitted)
                        sent to the Local Compliance Group for each Covered
                        Account the Employee has, or as a result of the
                        transaction acquires, any direct or indirect beneficial
                        ownership (as defined in sub-section E.3. below).

                        Employees are required to: (i) confirm that no open
                        orders exist in the same or related security with the
                        appropriate trading desk(s) (as determined by the Local
                        Compliance Group); and (ii) have the transaction
                        approved by the Local Compliance Group.

                        Portfolio managers and research analysts (or persons
                        reporting to portfolio managers or research analysts) of
                        Investment Management seeking pre-clearance for a
                        Personal Securities Transaction must obtain an
                        additional signature from a designated Senior Portfolio
                        Manager (prior to pre-clearance from the Local
                        Compliance Group). Trading desk personnel at any Covered
                        Company seeking pre-clearance for a Personal Securities
                        Transaction must obtain an additional signature from
                        their immediate supervisor prior to pre-clearance from
                        the Local Compliance Group.

               (c)      Filing and Approval

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                        After all required signatures are obtained, the Personal
                        Securities Transaction Approval Form must be filed with
                        the Local Compliance Group. The Employee should retain a
                        copy for his/her records.

                        Compliance will act on the request and notify the
                        Employee whether the request has been approved or
                        denied. If pre-clearance of a request is approved, it is
                        effective only for a transaction completed prior to the
                        close of business on the day of approval. Any
                        transaction not completed will require a new approval.

                        Each Local Compliance Group has implemented procedures
                        reasonably designed to monitor purchases and sales
                        effected pursuant to these pre-clearance procedures.

         2.    Factors Considered in Pre-Clearance of Personal Securities
               Transactions

               In reviewing any Personal Securities Transaction for
               pre-clearance, the following factors, among others, will
               generally be considered:

               o        Whether the amount or the nature of the transaction, or
                        the Employee making it, is likely to affect the price or
                        market of security that is held by a Fund or a Managed
                        Account Client.
               o        Whether the purchase or sale transaction of the Covered
                        Security by the Employee: (i) is being considered for
                        purchase or sale by a Fund or a Managed Account; or (ii)
                        is being purchased or sold by a Fund or a Managed
                        Account Client.
               o        Whether the individual making the proposed purchase or
                        sale is likely to benefit from purchases or sales being
                        made or considered on behalf of any Fund or a Managed
                        Account Client.
               o        Whether the transaction is non-volitional on the part of
                        the Employee.
               o        Whether the transaction is conducted in a manner that is
                        consistent with the Code to avoid any appearance of
                        impropriety.

               In addition to the requirements set forth in the Code, the Local
               Compliance Group and/or, if applicable, designated Senior
               Portfolio Manager/immediate trading room supervisor (as
               appropriate), in keeping with the general principles and
               objectives of the Code, may refuse to grant pre-clearance of a
               Personal Securities Transaction in their sole discretion without
               being required to specify any reason for the refusal.

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E.       Permitted Brokerage Accounts and Accounts Holding Morgan Stanley/Van
         Kampen Funds

         1.    Brokerage Accounts

               All securities transactions must be made through a Morgan Stanley
               brokerage account(5). No other brokerage accounts, including
               mutual fund accounts with brokerage capabilities, are permitted
               unless special permission is obtained from the Local Compliance
               Group. If an Employee maintains an account(s) outside of Morgan
               Stanley, that Employee must transfer his/her account(s) to a
               Morgan Stanley brokerage account as soon as practical (generally
               within 30 days). Failure to do so will be considered a
               significant violation of the Code. In the event permission to
               maintain an outside brokerage account is granted by the Local
               Compliance Group, it is the responsibility of the Employee to
               arrange for duplicate confirmations of all securities
               transactions and brokerage statements to be sent to the Local
               Compliance Group.

               Prior to opening a Morgan Stanley brokerage account, Employees
               must obtain approval from their Local Compliance Group. No
               Employee may open a brokerage account unless a completed and
               signed copy of a Morgan Stanley Employee Account Request Form
               attached as EXHIBIT C is submitted to the Local Compliance Group
               for approval. Employees are responsible for reporting their
               Morgan Stanley account number to the Local Compliance Group.

         2.    Accounts Holding Affiliated Mutual Funds

               The opening of an account for purchase of Affiliated Mutual Funds
               (other than participation in the Morgan Stanley 401(k) Plan) must
               be pre-approved by the Local Compliance Group. Duplicate
               confirmations of all transactions and statements must be sent to
               the Local Compliance Group. (See EXHIBIT C).

         3.    Accounts Covered

               An Employee must obtain pre-clearance for any Personal Securities
               Transaction if such Employee has, or as a result of the
               transaction acquires, any direct or indirect beneficial ownership
               in the security.

               The term "beneficial ownership" shall be interpreted with
               reference to the definition contained in the provisions of
               Section 16 of the Securities

- ----------
(5) Morgan Stanley brokerage account shall mean an account with an affiliated
Morgan Stanley broker in the Employee's local jurisdiction.

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               Exchange Act of 1934. Generally, a person is regarded as having
               beneficial ownership of securities held in the name of:

               (a)      the individual; or

               (b)      a husband, wife or a minor child; or

               (c)      a relative sharing the same house; or

               (d)      other person if the Employee: (i) obtains benefits
                        substantially equivalent to ownership of the securities;
                        (ii) can obtain ownership of the securities immediately
                        or at some future time; or (iii) can have investment
                        discretion or otherwise can exercise control.


               The following circumstances constitute Beneficial Ownership by an
               Employee of securities held by a trust:

               (a)      Ownership of securities as a trustee where either the
                        Employee or members of the Employee's immediate family
                        have a vested interest in the principal or income of the
                        trust.

               (b)      Estate or trust accounts in which the Employee has the
                        power to effect investment decisions, unless a specific
                        exemption is granted.

               (c)      Any Employee who is a settlor of a trust is required to
                        comply with all the provisions of the Code, unless
                        special exemption in advance is granted by the Local
                        Compliance Group and: (i) the Employee does not have any
                        direct or indirect beneficial interest in the trust;
                        (ii) the Employee does not have the direct or indirect
                        power to effect investment decisions for the trust, and
                        (iii) the consent of all the beneficiaries is required
                        in order for the Employee to revoke the trust.


               It is the responsibility of the Employee to arrange for duplicate
               confirmations of all securities transactions and statements to be
               sent to the Local Compliance Group. The final determination of
               beneficial ownership is a question to be determined in light of
               the facts of each particular case. If there are any questions as
               to beneficial ownership, please contact your Local Compliance
               Group.

         4.    Accounts Exempt from Pre-approval Requirement

               Pre-approval is not required for any account where the Employee
               does not have direct or indirect beneficial ownership. In case of
               doubt as to whether

                                       14


<PAGE>




[MORGAN STANLEY LOGO]



               an account is a Covered Account, Employees must consult with
               their Local Compliance Group.

VI.      Reporting Requirements

         A.    Report of Transactions

               Employees are subject to several reporting requirements including
               an Initial Listing of Securities Holdings and Accounts when an
               Employee commences employment with Investment Management,
               Quarterly Securities Transactions and New Accounts Reports and an
               Annual Listing of Securities Holdings Report and Certification of
               Compliance. It is the responsibility of Employees to submit their
               reports in a timely manner. Compliance will notify Employees of
               their Quarterly and Annual Reporting obligations under the Code.

               1.       Initial Listing of Securities Holdings and Brokerage and
                        Morgan Stanley/Van Kampen Mutual Fund Accounts Report

                        When an Employee begins employment with Investment
                        Management he or she must provide an Initial Listing of
                        Securities Holdings and Brokerage Accounts Report to
                        their Local Compliance Group disclosing: (i) all Covered
                        Securities, including Affiliated Mutual Funds, and
                        private placement securities beneficially owned by the
                        Employee, listing the title of the security, number of
                        shares held, and principal amount of the security; (ii)
                        the name of the broker, dealer, bank or financial
                        institution where the Employee maintains a personal
                        account; and (iii) the date the report is submitted by
                        the Employee.

               2.       Quarterly Securities Transactions and New Brokerage
                        and Morgan Stanley/Van Kampen Mutual Fund Accounts
                        Reports

                        Quarterly Securities Transactions and New Brokerage and
                        Mutual Fund Accounts Reports must be submitted by
                        Employees within 10 calendar days after the end of each
                        calendar quarter. Any new brokerage account, any account
                        opened for the purchase of Morgan Stanley/Van Kampen
                        mutual funds, or any mutual fund account(s) with
                        brokerage capabilities opened during the quarter without
                        their Local Compliance Group's prior approval must also
                        be reported within 10 calendar days after the end of
                        each calendar quarter. (See EXHIBIT E.)

                        (a)   All Personal Securities Transactions in Covered
                              Securities, and all securities transactions in
                              Morgan Stanley/Van Kampen open-end mutual funds
                              must be reported in the next quarterly transaction
                              report after the transaction is effected. Please
                              note exceptions to

                                       15


<PAGE>




[MORGAN STANLEY LOGO]



                              this in sub-section (b) below. The quarterly
                              report shall contain the following information:

                              (i)     The date of the transaction, the title,
                                      interest rate and maturity date (if
                                      applicable), number of shares and
                                      principal amount of each security
                                      involved;

                              (ii)    The nature of the transaction (i.e.,
                                      purchase, sale, or any other type of
                                      acquisition or disposition);

                              (iii)   The price at which the purchase or sale
                                      was effected;

                              (iv)    The name of the broker, dealer, bank or
                                      other financial institution with, or
                                      through which, the purchase or sale was
                                      effected; and

                              (v)     The date the report was submitted to the
                                      Local Compliance Group by such person.


                              In addition, any new brokerage account, any
                              account opened for the purchase of Morgan
                              Stanley/Van Kampen mutual funds, or any mutual
                              fund account with brokerage capabilities opened
                              during the quarter without approval from the Local
                              Compliance Group must be reported. The report must
                              contain the following information:

                              (i)     The name of the broker, dealer, bank or
                                      other financial institution with whom the
                                      account was established; and

                              (ii)    The date the account was established.


                        (b)   Exemption from Filing Quarterly Report - An
                              Employee need not make a quarterly transaction
                              report if he/she: (i) maintains only a Morgan
                              Stanley brokerage account, Morgan Stanley/Van
                              Kampen direct account for the purchase of mutual
                              funds and/or Morgan Stanley 401(k) Plan and the
                              report would duplicate information contained in
                              the trade confirms, system generated reports or
                              account statements received by the Local
                              Compliance Group. In addition, the Employee must
                              not have opened any new brokerage accounts or
                              mutual fund accounts without obtaining approval
                              from their Local Compliance Group during the
                              quarter.

                                       16


<PAGE>


[MORGAN STANLEY LOGO]



         3.    Annual Listing of Securities Holdings Reports and Certification
               of Compliance

               The Annual Listing of Securities Holdings Report and
               Certification of Compliance requires all Employees to provide an
               annual listing of holdings of: (i) all Covered Securities
               beneficially owned and all Morgan Stanley/Van Kampen open-end
               mutual funds (excluding money market accounts), listing the title
               of the security, number of shares held, and principal amount of
               the security as of December 31 of the preceding year, (ii) the
               name of any broker, dealer, bank or financial institution where
               the account(s) in which these Covered Securities were maintained,
               as of December 31 of the preceding year; and (iii) the date the
               report is submitted. This report must be provided no later than
               30 calendar days after December 31 each year. In the case of
               Employees maintaining a Morgan Stanley brokerage
               account(s),Morgan Stanley/Van Kampen open-end mutual funds,
               and/or Morgan Stanley 401(k) Plan for which trade confirms,
               system generated reports or account statements are already
               received on a quarterly basis by the Local Compliance Group, an
               annual certification (Certification of Compliance) that the
               holdings information already provided to the Local Compliance
               Group accurately reflects all such holdings will satisfy the
               aforementioned requirement.

B.       Form of Reporting

         The Initial Listing of Securities Holdings and Brokerage Accounts
         Report, Quarterly Securities Transactions and New Brokerage Accounts
         Reports, and the Annual Listing of Securities Holdings Report and
         Certification of Compliance must be completed on the appropriate forms,
         attached as EXHIBITS D, E, AND F respectively, which would be provided
         by each Local Compliance Group. By not submitting a quarterly
         transaction report form, an Employee will be deemed to have represented
         that such person has: (i) executed reportable transactions only in
         accounts listed with the Local Compliance Group; or (ii) only traded
         securities exempt from the reporting requirements. Copies of the
         Initial Listing of Securities Holdings Report and Brokerage and Mutual
         Fund Accounts Report, Quarterly Securities Transactions and New
         Brokerage and Mutual Fund Accounts Reports, and the Annual Listing of
         Securities Holdings Report and Certification of Compliance, which may
         be revised from time to time, are attached as EXHIBITS D, E, AND F,
         respectively.

                                       17


<PAGE>

[MORGAN STANLEY LOGO]



C.       Responsibility to Report

         The responsibility for reporting is imposed on each Employee required
         to make a report. Any effort by a Covered Company to facilitate the
         reporting process does not change or alter that individual's
         responsibility.

D.       Leave of Absence

         Employees on leave of absence may not be subject to the pre-clearance
         and reporting provisions of the Code, provided that, during their leave
         period, they: (i) do not participate in, obtain information with
         respect to, make recommendations as to, or make the purchase and sale
         of securities on behalf of a Fund or a Managed Account Client; and (ii)
         do not have access to information regarding the day-to-day investment
         activities of Investment Management.

E.       Where to File Report

         All reports must be filed by Employees with their Local Compliance
         Group.

F.       Responsibility to Review

         Each Local Compliance Group will review all Initial Listing of
         Securities Holdings and Brokerage and Mutual Fund Accounts Reports,
         Quarterly Securities Transactions and New Brokerage and Morgan
         Stanley/Van Kampen Mutual Fund Accounts Reports, and Annual Listing of
         Securities Holdings Reports and Certification of Compliance, filed by
         Employees, as well as broker confirmations, system generated reports,
         and account statements.


                                       18


<PAGE>
[MORGAN STANLEY LOGO]



VII.     Code of Ethics Review Committee

         A Code of Ethics Review Committee, consisting of the President/Chief
         Operating Officer, Chief Investment Officer, Chief Legal Officer, Chief
         Compliance Officer and the Chief Administrative Officer -- Investments,
         of Morgan Stanley Investment Management or their designees will review
         and consider any proper request of an Employee for relief or exemption
         from any restriction, limitation or procedure contained herein
         consistent with the principles and objectives outlined in this Code.
         The Committee shall meet on an ad hoc basis, as it deems necessary,
         upon written request by an Employee stating the basis for the requested
         relief. The Committee's decision is within its sole discretion.

VIII.    Service as a Director and Outside Business Activities

         A.    Approval to Serve as a Director

               No Employee may serve on the board of any company without prior
               approval of the Code of Ethics Review Committee. If such approval
               is granted, it will be subject to the implementation of
               information barrier procedures to isolate any such person from
               making investment decisions for Funds or Managed Accounts
               concerning the company in question.

         B.    Approval to Engage in Outside Business Activities

               No Employee may engage in any outside business activities without
               prior approval of the Code of Ethics Review Committee. If such
               approval is granted, it is the responsibility of the Employee to
               notify Compliance immediately if any conflict or potential
               conflict of interest arises in the course of such activity.

         C.    Approval Process

               A copy of a Form for approval to serve as a Director and to
               engage in Outside Business Activities is attached as EXHIBIT G.
               This form should be completed and submitted to Compliance for
               processing.

IX.      Gifts

         No Employee shall accept directly or indirectly anything of value,
         including gifts and gratuities, in excess of $100 per year from any
         person or entity that does business with any Fund or Managed Account,
         not including occasional meals or tickets to theater or sporting events
         or other similar entertainment. Client entertainment expenses generally
         are not considered gifts if: (i) Firm personnel are present; (ii) a
         Firm client is present; and (iii) the entertainment is not so regular
         or frequent that it creates the appearance of impropriety.

                                       19


<PAGE>

[MORGAN STANLEY LOGO]




X.       Sanctions

         Upon discovering a violation of this Code, Investment Management may
         impose such sanctions as they deem appropriate, including a reprimand
         (orally or in writing), demotion, suspension or termination of
         employment and/or other possible sanctions. The President/Chief
         Operating Officer of Investment Management and the Chief Legal Officer
         or Chief Compliance Officer together, are authorized to determine the
         choice of sanctions to be imposed in specific cases, including
         termination of employment.

XI.      Employee Certification

         Employees are required to sign a copy of this Code indicating their
         understanding of, and their agreement to abide by the terms of this
         Code.

         In addition, Employees will be required to certify annually that: (i)
         they have read and understand the terms of this Code and recognize the
         responsibilities and obligations incurred by their being subject to
         this Code; and (ii) they are in compliance with the requirements of
         this Code, including but not limited to the reporting of all brokerage
         accounts, and the pre-clearance of all non-exempt Personal Securities
         Transactions in accordance with this Code.

                                       20


<PAGE>




[MORGAN STANLEY LOGO]


                                                                      SCHEDULE A

MORGAN STANLEY INVESTMENT ADVISORS INC.
MORGAN STANLEY INVESTMENT MANAGEMENT INC.
MORGAN STANLEY INVESTMENT MANAGEMENT LIMITED
MORGAN STANLEY INVESTMENT MANAGEMENT COMPANY
MORGAN STANLEY ASSET & INVESTMENT TRUST
         MANAGEMENT CO., LIMITED
MORGAN STANLEY INVESTMENT MANAGEMENT
         PRIVATE LIMITED
MORGAN STANLEY ALTERNATIVE INVESTMENT PARTNERS LP
MORGAN STANLEY AIP GP LP
MORGAN STANLEY HEDGE FUND PARTNERS GP LP
MORGAN STANLEY HEDGE FUND PARTNERS LP
MORGAN STANLEY SERVICES COMPANY INC.
MORGAN STANLEY DISTRIBUTORS INC.
MORGAN STANLEY DISTRIBUTION INC.
MORGAN STANLEY & CO. INCORPORATED
VAN KAMPEN ASSET MANAGEMENT
VAN KAMPEN ADVISORS INC.
VAN KAMPEN INVESTMENTS, INC.
VAN KAMPEN FUNDS INC.
VAN KAMPEN TRUST COMPANY
VAN KAMPEN INVESTOR SERVICES INC.



                                       21

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(17)(B)
<SEQUENCE>24
<FILENAME>c93084a1exv99wx17yxby.txt
<DESCRIPTION>CODE OF ETHICS OF THE FUND
<TEXT>
<PAGE>
                                                                   EXHIBIT 17(b)

CODE OF ETHICS

I. INTRODUCTION

         Each of the Van Kampen Open-End Funds currently offering shares to the
public, each Van Kampen Unit Investment Trust ("UIT") currently offering units
to the public, and each Van Kampen Closed-End Fund (each a "Fund" and
collectively the "Funds"), Van Kampen Asset Management Inc. ("Asset
Management"), Van Kampen Investment Advisory Corp. ("Advisory Corp."), Van
Kampen Advisors Inc. ("Advisors Inc."), and Van Kampen Management Inc.
("Management Inc.") (each of Asset Management, Advisory Corp., Advisors Inc. and
Management Inc. are sometimes referred herein as the "Adviser" or collectively
as the "Advisers") and Van Kampen Funds Inc. (the "Distributor") (the Advisers
and the Distributor are collectively referred to as "Van Kampen") has adopted
this Code of Ethics. The Advisers are fiduciaries that provide investment
advisory services to the Funds and private investment management accounts, and
the Distributor acts as the principal underwriter for the Funds and the sponsor
of Funds that are UITs, as the case may be.

I. GENERAL PRINCIPLES

         A.    Shareholder and Client Interests Come First

               Every trustee/director, officer and employee of a Fund and every
               director, officer and employee of Van Kampen owes a fiduciary
               duty to the investment account and the respective investors of
               such Fund or private investment management account (collectively,
               the "Clients"). This means that in every decision relating to
               investments, such persons must recognize the needs and interests
               of the Client and be certain that at all times the Clients'
               interests are placed ahead of any personal interest of such
               person.

         B.    Avoid Actual and Potential Conflicts of Interest

               The restrictions and requirements of this Code are designed to
               prevent behavior that conflicts, potentially conflicts or raises
               the appearance of an actual or potential conflict with the
               interests of Clients. It is of the utmost importance that the
               personal securities transactions of trustee/directors, officers
               and employees of a Fund and directors, officers and employees of
               Van Kampen be conducted in a manner consistent with both the
               letter and spirit of





                                       1
<PAGE>
               the Code, including these principles, to avoid any actual or
               potential conflict of interest or any abuse of such person's
               position of trust and responsibility.


         C.    Avoiding Personal Benefit

               1.  Trustee/directors, officers and employees of the Funds and
                   directors, officers and employees of Van Kampen should ensure
                   that they do not acquire personal benefit or advantage as a
                   result of the performance of their normal duties as they
                   relate to Clients. Consistent with the principle that the
                   interests of Clients must always come first is the
                   fundamental standard that personal advantage deriving from
                   management of Clients' money is to be avoided.

II. OBJECTIVE

         Section 17(j) of the Investment Company Act of 1940, as amended (the
"Investment Company Act"), makes it unlawful for certain persons associated with
investment companies to engage in conduct which is deceitful, fraudulent or
manipulative, or which involves false or misleading statements, in connection
with the purchase or sale of a security held or proposed to be acquired by an
investment company. In addition, Section 204A of the Investment Advisers Act of
1940, as amended (the "Investment Advisers Act"), requires investment advisers
to establish, maintain and enforce written policies and procedures designed to
prevent misuse of material non-public information. The objective of this Code
is to require trustee/directors, officers and employees of the Funds and
directors, officers and employees of Van Kampen to conduct themselves in
accordance with the general principles set forth above, as well as to prevent
trustee/directors, officers and employees of the Funds or the Distributor from
engaging in conduct prohibited by the Investment Company Act and directors,
officers and employees of the Advisers from engaging in conduct prohibited by
the Investment Company Act and the Investment Advisers Act.

III. DEFINITIONS

         A.    "Access Person," means (i) with respect to the Van Kampen
               Open-End and Closed-End Funds, (a) any trustee/director or
               officer of a Fund, (b) any director or officer of a Fund's
               Adviser, (c) any employee of a Fund or the Fund's Adviser (or any
               company in a control relationship to the Fund or Adviser) who, in
               connection with such person's regular functions or duties, makes,
               participates





                                       2
<PAGE>

               in, or obtains information regarding the purchase or sale of a
               Covered Security by a Client, or whose functions relate to the
               making of any recommendations with respect to such purchases or
               sales; (d) any natural person in a control relationship to the
               Fund or the Fund's Adviser who obtains information concerning
               recommendations made to a Client with regard to the purchase or
               sale of a Covered Security by such Client, and (e) any director
               or officer of the Distributor, who, in the ordinary course of
               business, makes, participates in or obtains information
               regarding, the purchase or sale of a Covered Security by a Client
               for which it acts as principal underwriter, or whose functions
               relate to the making of any recommendations with respect to such
               purchases or sales and (ii) with respect to UITs, (a) any
               officer, director or employee of the Distributor, when the
               Distributor is acting as the sponsor of a Fund that is a UIT,
               who, in connection with such person's regular functions or
               duties, makes, participates in, or obtains information regarding
               the purchase or sale of a Covered Security by a Client or whose
               functions relate to the making of any recommendations with
               respect to the composition of the Fund; and (b) and natural
               person in a control relationship to the Distributor who obtains
               information concerning recommendations made to a Client with
               regard to the purchase or sale of a Covered Security by such
               Client or the composition of the Fund.

         B.    "Beneficial Ownership" is interpreted in the same manner as it is
               under Rule 16a-1(a)(2) of the Securities Exchange Act of 1934, as
               amended (the "Exchange Act"), in determining whether a person is
               the beneficial owner of a security for purposes of Section 16 of
               the 1934 Act and the rules and regulations thereunder, which
               includes "any person who, directly or indirectly, through any
               contract, arrangement, understanding, relationship or otherwise,
               has or shares a direct or indirect pecuniary interest in" a
               security. The term "pecuniary interest" is further defined to
               mean "the opportunity, directly or indirectly, to profit or share
               in any profit derived from a transaction in the subject
               securities." "Beneficial ownership" includes (i) securities held
               by members of a person's immediate family sharing the same
               household and includes any child, stepchild, grandchild, parent,
               stepparent, grandparent, spouse, sibling, mother-in-law,
               father-in-law, son-in-law, daughter-in-law, brother-in-law, or
               sister-in-law" and includes adoptive relationships and (ii) a
               right to acquire securities through the exercise or conversion of
               any derivative security, whether or not presently exercisable.





                                       3
<PAGE>

               Any report required to be made by this Code may contain a
               statement that the report shall not be construed as an admission
               by the person making such report that he has any direct or
               indirect Beneficial Ownership in the security to which the report
               relates.

         C.    "Board of Directors/Trustees" means the directors/trustees of
               each Fund, or with respect to a Fund that is a UIT, the Fund's
               principal underwriter or sponsor.

         D.    "Chief Compliance Officer" is the individual set forth in Exhibit
               A.

         E.    "Client" means each Fund and each private management account or
               investment account over which Van Kampen exercises investment
               discretion.

         F.    "Code of Ethics Review Committee" consists of the individuals set
               forth in Exhibit A.

         G.    "Control" has the same meaning as in Section 2(a)(9) of the
               Investment Company Act.

         H.    "Covered Security" refers not only to the instruments set forth
               in Section 2(a)(36) of the Investment Company Act but to any
               instrument into which such instrument may be converted or
               exchanged, any warrant of any issuer that has issued the
               instrument and any option written relating to such instrument,
               provided, however, that it does not include: (a) any direct
               obligation of the United States Government, (b) banker's
               acceptances, bank certificates of deposit, commercial paper and
               high quality short- term debt instruments, including repurchase
               agreements, and (c) shares issued by any open-end investment
               companies registered under the Investment Company Act.

         I.    "Disinterested Trustee/Director" means a trustee or director of a
               Fund who is not an "interested person" of such Fund within the
               meaning of Section 2(a)(19) of the Investment Company Act.

         J.    "Employee Account" means any brokerage account or unit investment
               trust account in which the Van Kampen Employee has any direct or
               indirect beneficial ownership.

         K.    "General Counsel" is the individual set forth in Exhibit A.




                                       4
<PAGE>


         L.    "Initial Public Offering" means an offering of securities
               registered under the Securities Act of 1933, as amended (the
               "Securities Act"), the issuer of which, immediately before the
               registration, was not subject to the reporting requirements of
               sections 13 or 15(d) of the Securities Exchange Act of 1934, as
               amended (the "Exchange Act").

         M.    "Limited Offering" is an offering that is exempt from
               registration under the Securities Act pursuant to Section 4(2) or
               Section 4(6) of the Securities Act or pursuant to Rule 504, Rule
               505 or Rule 506 under the Securities Act.

         N.    "Portfolio Manager" means any person who exercises investment
               discretion on behalf of an Adviser for a Client, including those
               persons who are involved in determining, or have knowledge
               concerning, the composition of the portfolios of Funds that are
               UITs prior to deposit.

         O.    "Van Kampen Employee" includes any director, officer or employee
               of Van Kampen.

IV. STANDARDS OF CONDUCT FOR PERSONAL SECURITIES TRANSACTIONS

         A.    Van Kampen Employee Brokerage Accounts

               1.  All brokerage accounts of Van Kampen Employees must be
                   maintained through Morgan Stanley Dean Witter ("MSDW") and/or
                   Morgan Stanley Dean Witter Online ("MSDWO"). No other
                   brokerage accounts are permitted unless permission is granted
                   by the Chief Compliance Officer or General Counsel.

                   If any Van Kampen Employee maintains accounts outside MSDW or
                   MSDWO, such person must transfer such accounts to a MSDW
                   branch or MSDWO as soon as practicable from their date of
                   hire. If the transfer is not completed within 120 days, no
                   trading will be permitted in the account.

                   a)   Each Van Kampen Employee must identify and disclose on
                        his or her date of hire to the appropriate person in the
                        compliance department as set forth in Exhibit A, in
                        writing, of their MSDW and MSDWO brokerage accounts, or,
                        if applicable, their outside





                                       5
<PAGE>

                        brokerage accounts. The Van Kampen compliance department
                        shall direct, and the employee shall consent in writing
                        to such direction, the brokerage firm to provide
                        duplicate confirmations and account statements to the
                        Van Kampen compliance department.

                        (1)  Van Kampen Employees shall obtain written consent
                             from the appropriate person in the Van Kampen
                             compliance department as set forth in Exhibit A
                             before opening a brokerage account.

         B.    Pre-Clearance

               1.  Except as set forth below, all Van Kampen Employees must pre-
                   clear purchases or sales of Covered Securities in their
                   Employee Accounts with the appropriate person in the Van
                   Kampen compliance department as set forth in Exhibit A.

               2.  Exceptions from the Pre-Clearance Requirement

                   a)   Persons otherwise subject to pre-clearance are not
                        required to pre- clear the acquisition of the following
                        Covered Securities:

                       (1)  Covered Securities acquired through automatic
                            reinvestment plans.

                       (2)  Covered Securities acquired through employee
                            purchase plans.

                       (3)  Covered Securities acquired through the exercise of
                            rights issued by an issuer pro- rata to all holders
                            of a class of its securities, to the extent such
                            rights were acquired from such issuer, and sales of
                            such rights so acquired.

                       (4)  A purchase or sale of Covered Securities which is
                            non-volitional on the part of the Employee (for
                            example, a purchase or sale effected by an
                            investment manager for a pension or retirement





                                       6
<PAGE>

                             plan, other than an individual retirement account,
                             in which an Employee is a beneficiary).(3)

                        (5)  Morgan Stanley Dean Witter & Co. common stock
                             (including exercise of stock option grants),

                             (a)  The restrictions imposed by Morgan Stanley
                                  Dean Witter & Co. on senior management and
                                  other persons in connection with transactions
                                  in such stock are not affected by this
                                  exemption. (b) Transactions by Access Persons
                                  in Morgan Stanley Dean Witter & Co. common
                                  stock remain subject to the initial, quarterly
                                  and annual reporting requirements of Part V(D)
                                  of the Code.

                        (6)  Units in unit investment trusts. Transactions by
                             Access Persons in units of unit investment trusts
                             remain subject to the initial, quarterly and annual
                             reporting requirements of Part V(D) of the Code.



         3.    Pre-cleared securities transactions must be effected on a timely
               basis.

               a)  All approved Covered Securities transactions must take place
                   between the hours of 9:30 a.m. and 4:00 p.m. (New York time).
                   Trading after hours is prohibited. If the transaction is not
                   completed between 9:30 a.m. and 4:00 p.m. on the date of
                   pre-clearance, a new pre-clearance must be obtained.

               b)  Purchases through an issuer direct purchase plan must be pre-
                   cleared on the date the purchaser writes the check to the
                   issuer's agent.

                   (1)  Authorization for purchases through an issuer direct
                        purchase plan are effective until the issuer's agent
                        purchases the Covered Securities.







                                       7
<PAGE>

               4.  Pre-Clearance Procedure

                   a)   Van Kampen Employees shall pre- clear their transactions
                        by submitting a Trade Authorization Form (a copy of
                        which is attached as Exhibit B) to the appropriate
                        persons in the compliance department as set forth in
                        Exhibit A.

                        (1)  The compliance department shall pre- clear the
                             purchase or sale of a Covered Security if the
                             transaction does not violate the Code.

                             (a)  The compliance department shall verify that
                                  the transaction is in compliance with the
                                  Code.

                             (b)  The compliance department shall sign the Trade
                                  Authorization Form.

                             (c)  The compliance department shall communicate
                                  authorization of the trade to the Van Kampen
                                  Employee.

                             (d)  The time at which the trade authorization is
                                  communicated to the Van Kampen Employee shall
                                  be documented on the Trade Authorization Form
                                  by the Legal and Compliance Department.

                             (e)  The compliance department shall maintain the
                                  originally executed Trade Authorization Form.
                                  A copy of the executed Trade Authorization
                                  Form will be forwarded to the Van Kampen
                                  Employee.

                             (f)  The compliance department shall review all Van
                                  Kampen Employee duplicate confirmations and
                                  statements to verify that all personal
                                  transactions in Covered Securities have been
                                  properly pre-cleared.






                                       8
<PAGE>

               C.  Other Restrictions

                   1.   Van Kampen Employees shall not purchase or sell a
                        Covered Security on a day during which a Client, with
                        the exception of a UIT, has a pending purchase or sale
                        order in that same Covered Security, or with respect to
                        a UIT Client, on the initial date of deposit when the
                        UIT Client has a pending order in that same Covered
                        Security.

                   2.   Van Kampen Employee trades for which pre- clearance has
                        been obtained, including short sales and permissible
                        option trades, are subject to a 30- day holding period
                        from the trade date.

                   3.   Van Kampen Employees are prohibited from trading in
                        futures, options on futures, and forward contracts. Van
                        Kampen Employees may trade listed equity and index
                        options and equity warrants, however, there is a 30- day
                        holding period from the trade date. In addition, Van
                        Kampen Employees are also prohibited from trading in
                        warrants or options (with the exception of listed
                        warrants or options) on physical commodities and
                        currencies.

                   4.   Van Kampen Employees shall not enter into limit orders
                        that extend beyond one day.

                   5.   Van Kampen Employees shall not participate in an
                        investment club.

                   6.   Van Kampen Employees shall not purchase shares of an
                        investment company that is managed by Van Kampen if such
                        investment company is not generally available to the
                        public.

                   7.   Van Kampen Employees shall not purchase shares of an
                        open end investment company that is managed by Van
                        Kampen if as a result of such purchase the Van Kampen
                        Employee shall own 1% or more of the assets of such
                        investment company.

                   8.   Van Kampen Employees are prohibited from the following
                        activities unless they have obtained prior written
                        approval from the Code of Ethics Review Committee:





                                       9
<PAGE>

                        a)   Van Kampen Employees may not purchase a Covered
                             Security in a private placement or any other
                             Limited Offering.

                        b)   Van Kampen Employees may not serve on the boards of
                             directors of a public or private company. Requests
                             to serve on the board of a religious, charitable or
                             educational organization as set forth in Section
                             503(c) of the IRS Code will generally be approved.

                   9.   Van Kampen Employees shall not purchase Covered
                        Securities during an initial or secondary public
                        offering.

                   10.  Annual Reporting:

                        a)   Van Kampen Employees shall furnish to the Chief
                             Compliance Officer an annual affirmation that
                             he/she has received, read and understood the Van
                             Kampen Code of Ethics.


               D.  Responsibilities of Access Persons

                   The following prohibitions and reporting obligations are
                   applicable to Access Persons.


                   1.   Access Persons, with the exception of a Disinterested
                        Trustee/Director, shall not sell a Covered Security
                        purchased within the previous 60 calendar days from the
                        trade date, except that a Covered Security held for at
                        least 30 days from the trade date may be sold at a loss
                        or no gain. Any profits realized on trades executed
                        within the 60-day holding period shall be disgorged to
                        the Client or a charitable organization as determined by
                        the Chief Compliance Officer.

                   2.   Initial/Annual Reporting: Within ten days after becoming
                        an Access Person and thereafter, annually at the end of
                        the calendar year, each Access Person must furnish a
                        report to the Chief Compliance Officer showing (i) the
                        date of the report, (ii) the title, number of shares and
                        principal amount of each Covered Security in which the
                        Access Person has direct or indirect Beneficial
                        Ownership on the date such person





                                       10
<PAGE>

                        become an Access Person (for initial reports) or as of a
                        date no more than 30 days prior to the date of the
                        report (for annual reports) and (iii) the name of any
                        broker, dealer or bank with an account holding any
                        securities for the direct or indirect benefit of the
                        Access Person as of the date such person became an
                        Access Person (for initial reports) or as of a date no
                        more than 30 days prior to the date of the report (for
                        annual reports).

                        a)   Exclusion: A Disinterested Trustee/Director who
                             would be required to make this report solely by
                             reason of being a Fund trustee/director is excluded
                             from the initial and annual reporting requirement
                             for Access Persons.

                   3.   Quarterly Reporting: On a calendar quarterly basis, each
                        Access Person must furnish a report to the Chief
                        Compliance Officer within ten days after the end of each
                        calendar quarter, on forms sent to the Access Person
                        each quarter:

                        a)   With respect to any transactions in Covered
                             Securities that the Employee has made in the
                             previous calendar quarter in which the Access
                             Person had direct or indirect Beneficial Ownership,
                             a report showing (i) the date of the report; (ii)
                             the date of the transaction, the title, the
                             interest rate and maturity date (if applicable),
                             the number of shares, and the principal amount of
                             each Covered Security involved; (iii) the nature of
                             the transaction (i.e., purchase, sale or any other
                             type of acquisition or disposition); (iv) the price
                             at which the transaction was effected; and (v) the
                             name of the broker, dealer or bank with or through
                             which the transaction was effected; and

                        b)   With respect to any account established by the
                             Access Person in which any securities were held
                             during the quarter for direct or indirect benefit
                             of the Access Person, a report showing (i) the date
                             of the report; (ii) the name of the broker, dealer
                             or bank with which established the account; and
                             (iii) the date the account was established.






                                       11
<PAGE>

                        c)   Exclusion: A Disinterested Trustee/Director who
                             would be required to make this report solely by
                             reason of being a Fund trustee/director is excluded
                             from the quarterly reporting requirement for Access
                             Persons unless the trustee/director knew or, in the
                             ordinary course of fulfilling his or her official
                             duties as a Fund trustee/director, should have
                             known that during the 15- day period immediately
                             before or after the trustee/director's transaction
                             in a Covered Security, the Fund purchased or sold
                             the Covered Security, or the Fund or its investment
                             adviser considered purchasing or selling the
                             Covered Security.

                        d)   Exclusion: An Access Person need not make a
                             quarterly transaction report if the report would
                             duplicate information contained in broker trade
                             confirmations or account statements received by the
                             Fund, the Adviser and the Distributor with respect
                             to the Access Person in the time period required
                             above if all of the information required by that
                             paragraph is contained in the broker trade
                             confirmations or account statements, or in the
                             records of the Fund, the Adviser and the
                             Distributor. An Access Person may rely on this
                             exclusion only if he/she (1) maintains a MSDW
                             and/or MSDWO account, or outside account for which
                             the Access Person has a written exception; and (2)
                             has not opened any new brokerage account during the
                             quarter.

               A.  Additional Responsibilities of Portfolio Managers

                   In addition to the requirements set forth above for Van
                   Kampen Employees and Access Persons, the following additional
                   requirements are applicable to Portfolio Managers.

                   1.   A Portfolio Manager, including individuals involved in
                        determining the composition of the portfolios of Funds
                        that are UITs or who have knowledge of a composition of
                        a UIT portfolio before deposit (a "UIT Portfolio
                        Manager"), may not buy or sell a Covered Security within
                        7 calendar days before or after any Client, over which
                        such Portfolio Manager exercises investment discretion,
                        trades in such Covered Security.






                                       12
<PAGE>

                   2.   A Portfolio Manager may not purchase shares of a
                        closed-end investment company over which such Portfolio
                        Manager exercises investment discretion.



               A.  Insiders

                   1.   Each Van Kampen Employee shall comply with all laws and
                        regulations, and prohibitions against insider trading.
                        Trading on or communicating material non-public
                        information, or "inside information," of any sort,
                        whether obtained in the course of research activities,
                        through a Client relationship or otherwise, is strictly
                        prohibited.

                   2.   Van Kampen Employees shall not disclose any non-public
                        information relating to a Client's account portfolio or
                        transactions or to the investment recommendations of Van
                        Kampen, nor shall any Van Kampen Employee disclose any
                        non-public information relating to the business or
                        operations of the members of Van Kampen, unless properly
                        authorized to do so by the Chief Compliance Officer or
                        General Counsel.

                   3.   No Van Kampen Employee who is required to file a
                        statement of ownership pursuant to Section 16 of the
                        Exchange Act may purchase or sell or sell and purchase a
                        company- sponsored closed-end investment company within
                        a six month period and realize a profit on such
                        transaction.

               B.  Exceptions

                   1.   Notwithstanding the foregoing, the Chief Compliance
                        Officer or his or her designee, in keeping with the
                        general principles and objectives of this Code, may
                        refuse to grant clearance of a personal transaction in
                        their sole discretion without being required to specify
                        any reason for the refusal.

                   2.   Upon proper request by a Van Kampen Employee, a Code of
                        Ethics Review Committee (the "Committee") will consider
                        for relief or exemption from any restriction, limitation
                        or procedure contained herein, which restriction,
                        limitation or procedure is claimed to cause a hardship
                        for such Van





                                       13
<PAGE>

                        Kampen Employee. The Chief Compliance Officer will in
                        his sole discretion determine whether the request is
                        appropriate for consideration by the Committee. The
                        Committee shall meet on an ad hoc basis, as deemed
                        necessary upon the Van Kampen Employee's written request
                        outlining the basis for his or her request for relief.
                        The decision regarding such relief or exemption is
                        within the sole discretion of the Committee.

I. ADMINISTRATION OF THE CODE

               A.  The administration of this Code shall be the responsibility
                   of the Chief Compliance Officer or his or her designee whose
                   duties shall include:

                   1.   Continuously maintaining a list of all current Access
                        Persons who are under a duty to make reports or
                        pre-clear transactions under this Code.

                   2.   Providing each such person with a copy of this Code and
                        informing them of their duties and obligations
                        hereunder.

                   3.   Reviewing all quarterly securities transactions and
                        holdings reports required to be filed pursuant to this
                        Code, and maintaining a record of such review, including
                        the name of the compliance personnel performing the
                        review.

                   4.   Reviewing all initial and annual securities position
                        reports required to be filed pursuant to this Code, and
                        maintaining a record of such review, including the name
                        of the compliance personnel performing the review.

                   5.   Preparing listings of all transactions effected by
                        persons subject to reporting requirements under the Code
                        and comparing all reported personal securities
                        transactions with completed portfolio transactions of
                        the Client to determine whether a violation of this Code
                        may have occurred.

                   6.   Conducting such inspections or investigations as shall
                        reasonably be required to detect and report any apparent
                        violations of this Code to any person or persons
                        appointed by Van Kampen to deal with such information
                        and to the Fund's Board of Directors/Trustees.




                                       14
<PAGE>

                   7.   Submitting a written report, no less frequently than
                        annually, to the Board of Directors/Trustees of each
                        Fund and sponsor of Funds that are UITs containing a
                        description of issues arising under the Code or
                        procedures since the last report, including, but not
                        limited to, material violations of the Code or
                        procedures and sanctions imposed in response to material
                        violations.

                   8.   Submitting a certification, no less frequently than
                        annually, to the Board of Directors/Trustees of each
                        Fund from the Fund, the respective Adviser and the
                        Distributor that it has adopted procedures reasonably
                        necessary to prevent Access Persons from violating the
                        Code.

II. RECORDS

         The Fund, the Advisers and the Distributor shall, at its principal
places of business, maintain records of the following:

               A.  A copy of any code of ethics adopted by such entity that is
                   and has been in effect during the past five years must be
                   maintained in an easily accessible place;

               B.  A copy of any record or report of any violation of the code
                   of ethics of such entity and any action taken thereon
                   maintained in an easily accessible place for at least five
                   years after the end of the fiscal year in which the violation
                   occurs;

               C.  A copy of each report made by an Access Person as required by
                   this Code, including any information provided in lieu of the
                   reports and all Trade Authorization Forms, must be maintained
                   for at least five years after the end of the fiscal year in
                   which the report is made or the information is provided, the
                   first two years in an easily accessible place;

               D.  A record of all persons, currently or within the past five
                   years, who are or were required to make reports under this
                   Code, or who are or were responsible for reviewing these
                   reports, must be maintained in an easily accessible place;
                   and

               E.  A copy of each written report required to be provided to the
                   Board of Directors/Trustees of each Fund containing a
                   description of issues arising under the Code or procedures
                   since the last report,




                                       15
<PAGE>

                   including, but not limited to, material violations of the
                   Code or procedures and sanctions imposed in response to
                   material violations must be maintained for at least five
                   years after the end of the fiscal year in which it is made,
                   the first two years in an easily accessible place.

               F.  A Fund or investment adviser must maintain a record of any
                   decision, and the reasons supporting the decision, to approve
                   the acquisition by an Access Person of securities in an
                   Initial Public Offering or in a Limited Offering.

               G.  A copy of any decision and reasons supporting such decision
                   to approve a pre-clearance transaction pursuant to this Code,
                   made within the past five years after the end of the fiscal
                   year in which such approval is granted.

I. SANCTIONS

         Upon discovering a violation of this Code, Van Kampen may impose such
sanctions as it deems appropriate, including, but not limited to, a reprimand
(orally or in writing), fine, demotion, and suspension or termination of
employment. The General Counsel of Van Kampen, in his sole discretion, is
authorized to determine the choice of sanctions to be imposed in specific cases,
including termination of employment of any Employee.

II. APPROVAL OF CODE OF ETHICS

               A.  Van Kampen shall provide to the Board of Directors/Trustees
                   of each Fund and sponsor of Funds that are UITs the
                   following:

                   1.   A copy of the Fund's Code, the Adviser's Code and the
                        Distributor's Code for such Board's review and approval.

                   2.   Promptly, a copy of any amendments to such Codes.

                   3.   Upon request, copies of any reports made pursuant to the
                        Code by any person as to an investment company client.

                   4.   Immediately, without request by an investment company
                        client, all material information regarding any violation
                        of the Code by any person as to such investment company
                        client.







                                       16
<PAGE>

                   5.   Certification, no less frequently than annually, to the
                        Board of Directors/Trustees of each Fund from the Fund,
                        the respective Adviser and the Distributor that it has
                        adopted procedures reasonably necessary to prevent
                        Access Persons from violating the Code.

               B.  Prior to adopting this Code, the Board of Trustees/Directors
                   of each Fund, including a majority of Disinterested
                   Trustee/Directors, if applicable, reviewed and approved this
                   Code with respect to the Fund, each adviser of the Fund and
                   the Distributor of the Fund, including all procedures or
                   provisions related to the enforcement of this Code. The Board
                   based its approval of this Code on, among other things, (i)
                   certifications from the Fund, the respective Adviser and the
                   Distributor that it has adopted procedures reasonably
                   necessary to prevent violations of the Code and (ii) a
                   determination that such Code is adequate and contains
                   provisions reasonably necessary to prevent Access Persons
                   from engaging in any conduct prohibited by Rule 17j-1(b).

III. EFFECTIVE DATE

                   All Van Kampen Employees are required to sign a copy of this
Code indicating their agreement to abide by the terms of the Code.

                   In addition, Van Kampen Employees will be required to certify
annually that (i) they have read and understand the terms of this Code and
recognize the responsibilities and obligations incurred by their being subject
to this Code, and (ii) they are in compliance with the requirements of the Code.



Effective this 14th day of February, 2001.









                                       17
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.(99)
<SEQUENCE>25
<FILENAME>c93084a1exv99wx99y.txt
<DESCRIPTION>FORM OF PROXY CARD FOR THE TARGET FUND
<TEXT>
<PAGE>
                                                                      EXHIBIT 99



                      EVERY SHAREHOLDER'S VOTE IS IMPORTANT


                                            YOUR PROXY VOTE IS IMPORTANT!

                                            AND NOW YOU CAN VOTE YOUR PROXY ON
                                            THE PHONE, OR THE INTERNET.

                                            IT SAVES MONEY! TELEPHONE,
                                            FACSIMILE AND INTERNET VOTING SAVES
                                            POSTAGE COSTS. SAVINGS WHICH CAN
                                            HELP MINIMIZE EXPENSES.

                                            IT SAVES TIME! TELEPHONE AND
                                            INTERNET VOTING IS INSTANTANEOUS -
                                            24 HOURS A DAY.

                                            IT'S EASY! JUST FOLLOW THESE SIMPLE
                                            STEPS:

                                            1. READ YOUR PROXY STATEMENT AND
                                            HAVE IT AT HAND.

                                            2. CALL TOLL-FREE 1-866-241-6192,
                                            OR GO TO WEBSITE:
                                            HTTPS://VOTE.PROXY-DIRECT.COM

                                            3. FOLLOW THE RECORDED OR ON-SCREEN
                                            DIRECTIONS.

                                            4. DO NOT MAIL YOUR PROXY CARD WHEN
                                            YOU VOTE BY PHONE, OR INTERNET.



                  Please detach at perforation before mailing.


PROXY                       VAN KAMPEN XXXXXXXXX FUND                     PROXY

                 NOTICE OF JOINT SPECIAL MEETING OF SHAREHOLDERS
                           TO BE HELD ON JUNE 22, 2005

Notice is hereby given that a joint special meeting of shareholders (the
"Special Meeting") of Van Kampen XXXXXXX (the "Target Fund") will be held at the
offices of Van Kampen Investments Inc., 1 Parkview Plaza, Oakbrook Terrace,
Illinois 60181-5555 on June 22, 2005 at X:XX a.m. THIS PROXY IS SOLICITED ON
BEHALF OF THE TARGET FUND'S BOARD OF TRUSTEES.

THE BOARD OF TRUSTEES OF THE TARGET FUND REQUESTS THAT YOU VOTE YOUR SHARES BY
INDICATING YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD, DATING AND
SIGNING SUCH PROXY CARD AND RETURNING IT IN THE ENVELOPE PROVIDED, WHICH IS
ADDRESSED FOR YOUR CONVENIENCE AND NEEDS NO POSTAGE IF MAILED IN THE UNITED
STATES, OR BY RECORDING YOUR VOTING INSTRUCTIONS BY TELEPHONE OR VIA THE
INTERNET.

                                          VOTE VIA THE TELEPHONE: 1-866-241-6192
                                          VOTE VIA THE INTERNET:
                                          HTTPS://VOTE.PROXY-DIRECT.COM
                                          999 9999 9999 999


                                          NOTE: Please sign exactly as your name
                                          appears on this proxy card. All joint
                                          owners should sign. When signing as
                                          executor, administrator, attorney,
                                          trustee or guardian or as custodian
                                          for a minor, please give full title as
                                          such. If a corporation, please sign in
                                          full corporate name and indicate the
                                          signer's office. If a partner, sign in
                                          the partnership name.


                                          --------------------------------------
                                          Signature


                                          --------------------------------------
                                          Signature (if held jointly)


                                          --------------------------------------
                                          Date                        XXX XXXX
<PAGE>
                      EVERY SHAREHOLDER'S VOTE IS IMPORTANT












                        PLEASE SIGN, DATE AND RETURN YOUR
                                   PROXY TODAY




                  Please detach at perforation before mailing.



THE BOARD OF TRUSTEES RECOMMENDS THAT YOU VOTE FOR THE PROPOSALS.
PLEASE MARK VOTES AS IN THIS EXAMPLE: [X]


<TABLE>
<CAPTION>
                                                             FOR  AGAINST  ABSTAIN



<S>                                                          <C>  <C>      <C>
   1.  To approve an Agreement and Plan of Reorganization    [ ]    [ ]      [ ]
       between the Target Fund and the Acquiring Fund, the
       termination of Target Fund's registration under the
       Investment Company Act of 1940, as amended, and the
       dissolution of the Target Fund under applicable
       state law;

   2.  To transact such other business as may properly be
       presented at the Special Meeting or any adjournment
       thereof.
</TABLE>





                           YOUR VOTE IS IMPORTANT.
                PLEASE VOTE PROMPTLY BY SIGNING AND RETURNING
             THE ENCLOSED PROXY CARD OR BY RECORDING YOUR VOTING
                          INSTRUCTIONS BY TELEPHONE
            OR VIA THE INTERNET NO MATTER HOW MANY SHARES YOU OWN.

                                   XXX XXXX


</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
