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PAINEWEBBER MUTUAL FUNDS
PROSPECTUS SUPPLEMENT
DATED NOVEMBER 6, 1995
The following information revises the information contained in the Prospectuses
of the Funds listed below:
For purchases of Fund shares made on or after November 10, 1995, the
following changes to the Funds' Class A, Class B and Class D shares
will be in effect:
a. Class A Shares. Class A shares of each Fund purchased without an
initial sales charge due to the sales charge waiver for purchases of $1
million or more and held less than one year are subject to a contingent
deferred sales charge ("CDSC") upon redemption. The holding period of
Class A shares of a Fund acquired through an exchange with another
PaineWebber mutual fund ("PW Fund") is calculated from the date the
Class A shares of that PW Fund were initially purchased without a sales
charge. The Class A CDSC equals 1% of the lower of: (a) the net asset
value of the shares at the time of purchase or (b) the net asset value
of the shares at the time of redemption. Class A shares of each Fund
held one year or longer and Class A shares of each Fund acquired
through reinvestment of dividends or capital gains distributions are
not subject to this CDSC. The CDSC for Class A shares of each Fund is
waived for redemptions in connection with the systematic withdrawal
plan, subject to the limitations described below.
b. Class B Shares. The description of the calculation of the CDSC for
Class B shares of each Fund has been modified slightly. The maximum
CDSC for Class B shares of each Fund equals 5% of the lower of: (a) the
net asset value of the shares at the time of purchase or (b) the net
asset value of the shares at the time of redemption. Class B shares of
each Fund held six years or longer and Class B shares acquired through
reinvestment of dividends or capital gains distributions are not
subject to the CDSC. The CDSC for Class B shares of each Fund is waived
under the circumstances described in that Fund's Prospectus. Class B
shares of each Fund convert into Class A shares as described in that
Fund's Prospectus.
c. Class C Shares (Formerly Class D shares). Effective November 10,
1995, all Class D shares will be renamed Class C shares.
Class C shares of each Fund held less than one year will be subject to
a CDSC on redemptions. The holding period of Class C shares of a Fund
acquired through an exchange with another PW Fund is calculated from
the date the Class C shares of that PW Fund were initially purchased.
The CDSC on Class C shares equals 0.75% (with respect to fixed income
funds, including, PaineWebber California Tax-Free Income Fund,
PaineWebber Global Income Fund, PaineWebber High Income Fund,
PaineWebber Investment Grade Income Fund, PaineWebber Low Duration U.S.
Government Income Fund, PaineWebber Municipal High Income Fund,
PaineWebber National Tax-Free Income Fund, PaineWebber New York
Tax-Free Income Fund, PaineWebber Strategic Income Fund and PaineWebber
U.S. Government Income Fund) or 1.00% (with respect to equity funds,
including PaineWebber Balanced Fund, PaineWebber Capital Appreciation
Fund, PaineWebber Growth Fund, PaineWebber Growth and Income Fund,
PaineWebber Small Cap Value Fund and PaineWebber Utility Income Fund)
of the lower of: (a) the net asset value of the shares at the time of
purchase or (b) the net asset value of the shares at the time of
redemption. Redemptions of Class C shares of a Fund acquired through an
exchange and held less than one year will be subject to the same CDSC
that would have been imposed on Class C shares of the PW Fund
originally purchased that were subsequently exchanged into Class C
shares of the Fund. Class C shares of each Fund held one year or longer
and Class C shares of each Fund acquired through reinvestment of
dividends or capital gains are not subject to the CDSC. The CDSC for
Class C shares of each Fund is waived for redemptions in connection
with the systematic withdrawal plan, subject to the limitations
described below.
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d. Waivers for Systematic Withdrawal Plan. Shareholders who own Class A
shares or Class C shares (formerly Class D shares) of a Fund with a
value of $5,000 or more may have PaineWebber redeem a portion of their
shares monthly, quarterly or semi-annually under the systematic
withdrawal plan. Shareholders who participate in the systematic
withdrawal plan must elect to have all dividends reinvested in
additional shares of the same Class. The minimum amount for all
withdrawals of Class A or Class C shares is $100. Provided that the
shareholder does not withdraw an amount exceeding 12% in the first year
after purchase of his or her "Initial Account Balance," a term that
means the value of the Fund account at the time the shareholder elects
to participate in the systematic withdrawal plan, no CDSC is imposed on
such withdrawals within the first year after purchase for (1) Class A
shares purchased pursuant to the sales charge waiver for purchases of
$1 million or more and (2) Class C shares. Class A or Class C
shareholders' participation in the systematic withdrawal plan will
terminate automatically if the Initial Account Balance (plus the net
asset value on the date of purchase of Fund shares acquired after the
election to participate in the systematic withdrawal plan) less
aggregate redemptions made other than pursuant to the systematic
withdrawal plan, is less than $5,000. No changes have been made to the
systematic withdrawal plan with respect to Class B shares.
The Prospectuses of the following PaineWebber Mutual Funds are supplemented by
this supplement:
NAME OF FUND DATE OF PROSPECTUS
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PaineWebber Balanced Fund July 1, 1995, as revised
August 14, 1995
PaineWebber California Tax-Free Income July 1, 1995,
Fund as supplemented
September 7, 1995
PaineWebber Capital Appreciation Fund August 1, 1995
PaineWebber Global Income Fund March 1, 1995, as
supplemented August 3, 1995
PaineWebber Growth Fund January 1, 1995
PaineWebber Growth and Income Fund May 12, 1995, as
supplemented June 21, 1995
PaineWebber High Income Fund April 1, 1995, as
supplemented
June 21, 1995
PaineWebber Investment Grade Income Fund April 1, 1995, as
supplemented June 21, 1995
PaineWebber Low Duration U.S. Government April 1, 1995, as
Income Fund supplemented June 21, 1995,
and August 17, 1995
PaineWebber Money Market Fund July 1, 1995
PaineWebber Municipal High Income Fund July 1, 1995,
as supplemented
September 7, 1995
PaineWebber National Tax-Free Fund June 1, 1995,
as supplemented
September 7, 1995
PaineWebber New York Tax-Free Income Fund July 1, 1995,
as supplemented
September 7, 1995
PaineWebber Small Cap Value Fund December 1, 1994, as
supplemented June 21, 1995
PaineWebber Strategic Income Fund June 1, 1995
PaineWebber U.S. Government Income Fund April 1, 1995, as
supplemented June 21, 1995
PaineWebber Utility Income Fund April 1, 1995, as
supplemented June 21, 1995
This Prospectus Supplement does not replace any prior supplements to the
Prospectuses listed above.
