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VAN KAMPEN AMERICAN CAPITAL
SUPPLEMENT DATED JANUARY 2, 1998 TO THE
PROSPECTUS DATED MARCH 28, 1997, AS PREVIOUSLY SUPPLEMENTED ON
AUGUST 4, 1997
VKAC HIGH YIELD MUNICIPAL FUND
PROSPECTUS DATED APRIL 30, 1997, AS PREVIOUSLY SUPPLEMENTED ON
AUGUST 4, 1997
VKAC CALIFORNIA INSURED TAX FREE FUND
VKAC FLORIDA INSURED TAX FREE INCOME FUND
VKAC INSURED TAX FREE INCOME FUND
VKAC INTERMEDIATE TERM MUNICIPAL INCOME FUND
VKAC MUNICIPAL INCOME FUND
VKAC NEW YORK TAX FREE INCOME FUND
VKAC PENNSYLVANIA TAX FREE INCOME FUND
VKAC TAX FREE HIGH INCOME FUND
Pursuant to the Fund's Prospectus, the Fund's Class A shares may be
purchased at net asset value under certain defined circumstances by certain
classes or groups of investors. Certain net asset value categories described in
the section "NAV PURCHASE OPTIONS" under "PURCHASE OF SHARES -- CLASS A SHARES
- -- OTHER PURCHASE PROGRAMS" have been amended as follows:
(2) Current or retired directors, officers and employees of Morgan Stanley
Group Inc. and any of its subsidiaries, employees of an investment subadviser to
any fund described in (1) above or an affiliate of such subadviser, and such
persons' families and their beneficial accounts.
(3) Directors, officers, employees and registered representatives of
financial institutions that have a selling group agreement with the Distributor
and their spouses and children under 21 years of age when purchasing for any
accounts they beneficially own, or, in the case of any such financial
institution, when purchasing for retirement plans for such institution's
employees; provided that such purchases are otherwise permitted by such
institutions.
(4) Registered investment advisers who charge a fee for their services,
trust companies and bank trust departments investing on their own behalf or on
behalf of their clients. The Distributor may pay Participating Dealers through
which purchases are made an amount up to 0.50% of the amount invested, over a
12-month period.
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(5) Trustees and other fiduciaries purchasing shares for retirement plans
which invest in multiple fund families through broker-dealer retirement plan
alliance programs that have entered into agreements with the Distributor and
which are subject to certain minimum size and operational requirements. Trustees
and other fiduciaries should refer to the Statement of Additional Information
for further detail with respect to such alliance programs.
An additional net asset value category, as described below, has been added
as item number 6 and the remaining items shall be renumbered accordingly.
(6) Beneficial owners of shares of Participating Funds held by a retirement
plan or held in a tax-advantaged retirement account who purchase shares of the
Fund with proceeds from distributions from such a plan or retirement account
other than distributions taken to correct an excess contribution.
As stated in the Fund's Prospectus, the Fund reserves the right to amend or
terminate the terms of offering shares of the Fund at net asset value at any
time.
The third paragraph of the section of the Prospectus captioned "PURCHASE OF
SHARES -- CLASS C SHARES -- WAIVER OF CONTINGENT DEFERRED SALES CHARGE" is
hereby amended as follows:
A commission or transaction fee of up to 1.00% of the purchase amount will
generally be paid to authorized dealers at the time of purchase. Authorized
dealers also will be paid ongoing commissions and transaction fees of up to
0.75% of the average daily net assets of the Fund's Class C shares generally
annually commencing in the second year after purchase. Additionally, the
Distributor may, from time to time, pay additional promotional incentives, in
the form of cash or other compensation, to authorized dealers that sell Class C
shares of the Fund.
The paragraph of the section of the Prospectus captioned "PURCHASE OF SHARES
- -- CLASS C SHARES -- WAIVER OF CONTINGENT DEFERRED SALES CHARGE" is hereby
amended as follows:
The CDSC is waived on redemptions of Class B shares and Class C shares (i)
following the death or disability (as defined in the Code) of a shareholder,
(ii) in connection with required minimum distributions from an IRA or other
retirement plan, (iii) pursuant to the Fund's systematic withdrawal plan but
limited to 12% annually of the initial value of the account; (iv) in
circumstances under which no commission or transaction fee is paid to authorized
dealers at the time of purchase of such shares; and (v) effected pursuant to the
right of the Fund to liquidate a shareholder's account as described herein under
"Redemption of Shares." The CDSC is also waived on redemptions of Class C shares
as it relates to the reinvestment of redemption proceeds in shares of the same
class of the Fund within 180 days after redemption. See the Statement of
Additional Information for further discussion of waiver provisions.
