MITCHELL HUTCHINS/KIDDER, PEABODY
MUNICIPAL BOND FUND
Supplement to Prospectus Dated October 28, 1995
The board of trustees of Mitchell Hutchins/Kidder, Peabody Investment
Trust II ("Trust") has approved a Plan of Reorganization and Termination
("Reorganization") for submission to the shareholders of its series, Mitchell
Hutchins/Kidder, Peabody Municipal Fund ("Fund"), at a special meeting to be
held October 27, 1995. If the proposed Reorganization is approved and
implemented, all the Fund's assets will be acquired and its liabilities assumed
by PaineWebber National Tax-Free Income Fund ("PW Fund") in a tax-free
reorganization. As a result of the Reorganization, the two funds' assets would
be combined and each Fund shareholder would, on the closing date of the
transaction, receive a number of full and fractional shares of the corresponding
Class of shares of PW Fund having an aggregate value equal to the value of the
shareholder's holdings in the Fund. PW Fund is a series of PaineWebber Mutual
Fund Trust, an open-end management investment company organized as a
Massachusetts business trust. There can be no assurance that the Fund's
shareholders will approve the Reorganization.
The meeting of Fund shareholders to consider the proposed
Reorganization will be held on October 27, 1995. If the Reorganization is
approved, sales of all Classes of Fund shares will cease on October 27, 1995, so
that Fund shares will no longer be available for purchase or exchange starting
on October 30, 1995, through the closing date of the Reorganization. Redemptions
of Fund shares and exchanges of Fund shares for shares of another PaineWebber or
Mitchell Hutchins/Kidder, Peabody mutual fund may be effected through the
closing date of the Reorganization.
Supplement Dated: August 31, 1995
This Supplement does not supersede any previous supplements
to the Prospectus.
