Schedule 14A Information required in proxy statement.
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

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[ X ] Preliminary Proxy Statement
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[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.149-11(c) or
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Dean Witter Premier Income Trust . . . . . . . . . . . . . . . .
(Name of Registrant as Specified in its Charter)

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(Name of Person(s) Filing Proxy Statement)

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[ ] Fee computed on table below per Exchange Act Rules
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2) Aggregate number of securities to which transaction applies:

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PRELIMINARY PROXY STATEMENT
TO BE FILED WITH THE SECURITIES & EXCHANGE COMMISSION

DEAN WITTER PREMIER INCOME TRUST

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 22, 1994

A Special Meeting of Shareholders of DEAN WITTER PREMIER INCOME TRUST (the
"Trust"), an unincorporated business trust organized under the laws of the
Commonwealth of Massachusetts, will be held in the Conference Center,
Forty-Fourth Floor, 2 World Trade Center, New York, New York 10048, on
December 22, 1994, at 10:00 a.m., New York City time, for the following
purposes:
1. To approve or disapprove a new sub-advisory agreement between Dean
Witter InterCapital Inc. ("InterCapital" or the "Investment Manager") and
BlackRock Financial Management L.P. ("BlackRock" or the "Sub-Adviser"); and
2. To transact such other business as may properly come before the Meeting
or any adjournments thereof.

Shareholders of record as of the close of business on October 20, 1994 are
entitled to notice of and to vote at the Meeting. If you cannot be present in
person, your management would greatly appreciate your filling in, signing and
returning the enclosed proxy promptly in the envelope provided for that
purpose.

In the event that the necessary quorum to transact business at the Meeting
or the vote required to approve or reject any proposal is not obtained, the
persons named as proxies may propose one or more adjournments of the meeting
for a total of not more than 60 days in the aggregate to permit further
solicitation of proxies. Any such adjournment will require the affirmative
vote of the holders of a majority of the Trust's shares present in person or
by proxy at the Meeting. The persons named as proxies will vote in favor of
such adjournment those proxies which they are entitled to vote in favor of
Proposal 1 and will vote against any such adjournment those proxies to be
voted against that proposal.

SHELDON CURTIS,
Secretary

October 31, 1994
New York, New York

IMPORTANT
YOU CAN HELP AVOID THE NECESSITY AND EXPENSE OF SENDING FOLLOW-UP LETTERS
TO ENSURE A QUORUM BY PROMPTLY RETURNING THE ENCLOSED PROXY. IF YOU ARE
UNABLE TO BE PRESENT IN PERSON, PLEASE FILL IN, SIGN AND RETURN THE ENCLOSED
PROXY IN ORDER THAT THE NECESSARY QUORUM MAY BE REPRESENTED AT THE MEETING.
THE ENCLOSED ENVELOPE REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.

DEAN WITTER PREMIER INCOME TRUST

TWO WORLD TRADE CENTER, NEW YORK, NEW YORK 10048

PROXY STATEMENT

SPECIAL MEETING OF SHAREHOLDERS
DECEMBER 22, 1994

This statement is furnished in connection with the solicitation of proxies
by the Board of Trustees (the "Board") of DEAN WITTER PREMIER INCOME TRUST
(the "Trust"), for use at the Special Meeting of Shareholders of the Trust to
be held on December 22, 1994 (the "Meeting"), and at any adjournments
thereof.

If the enclosed form of proxy is properly executed and returned in time to
be voted at the Meeting, the proxies named therein will vote the shares
represented by the proxy in accordance with the instructions marked thereon.
Unmarked proxies will be voted in favor of Proposal 1 as set forth in the
attached Notice of Special Meeting of Shareholders. A proxy may be revoked at
any time prior to its exercise by any of the following: written notice or
revocation to the Secretary of the Trust, execution and delivery of a later
dated proxy to the Secretary of the Trust, or attendance and voting at the
Meeting.

Shareholders of record as of the close of business on October 20, 1994,
the record date for the determination of Shareholders entitled to notice of
and to vote at the Meeting, are entitled to one vote for each share held and
a fractional vote for a fractional share. On October 20, 1994, there were
outstanding shares of beneficial interest of the Trust, all with $.01 par
value.

The Trustees and officers of the Trust,
together, owned less than 1% of the Trust's outstanding shares on that date.
The percentage ownership of shares of beneficial interest of the Trust
changes from time to time depending on purchases and redemptions by
Shareholders and the total number of shares outstanding.

The cost of soliciting proxies for the Meeting will be borne by BlackRock.
The Trust will not be required to bear any of such expenses. The solicitation
of proxies will be by mail, which may be supplemented by solicitation by
mail, telephone or otherwise through Trustees and officers of the Trust and
officers and regular employees of Dean Witter Reynolds Inc. ("DWR"), without
special compensation, or by proxy solicitors paid by BlackRock. The first
mailing of this proxy statement is expected to be made on or about October
31, 1994.

All information contained in this Proxy Statement concerning the Trust,
the Investment Manager or affiliates of the Investment Manager has been
supplied by each of such persons, respectively. All information contained in
this Proxy Statement regarding BlackRock or PNC Bank, N.A. ("PNC") or their
respective affiliates has been supplied by BlackRock or PNC, respectively.
(1) APPROVAL OR DISAPPROVAL OF A NEW SUB-ADVISORY AGREEMENT BETWEEN
DEAN WITTER INTERCAPITAL INC. AND BLACKROCK FINANCIAL MANAGEMENT L.P.

BACKGROUND

Pursuant to an investment management agreement (the "Investment Management
Agreement") entered into by the Trust and Dean Witter InterCapital Inc.
("InterCapital" or the "Investment Manager"), the

Investment Manager has entered into a sub-advisory agreement (the "Current
Sub-Advisory Agreement") with BlackRock Financial Management L.P. (the
"Sub-Adviser") to furnish investment advisory services to the Trust. The
Current Sub-Advisory Agreement, dated June 30, 1993, was initially approved
by the Board, including all of the Independent Trustees then serving, at a
special meeting held on January 12, 1993. The Current Sub-Advisory Agreement
was approved by Shareholders at a special meeting of Shareholders on January
12, 1993, called for such purpose.

On June , 1994, the Sub-Adviser entered into a definitive agreement to
sell the Sub-Adviser to PNC, located in Pittsburgh, for $240 million in the
form of cash and notes (the "Acquisition"). The Acquisition, which is subject
to bank regulatory approval, is expected to close on or prior to the end of
1994 and is subject to various conditions. After the closing of the
Acquisition, the Sub-Adviser will retain its name and will continue to
operate out of its New York office. All members of the Sub-Adviser's
management team have agreed to sign long-term employment contracts with PNC
and will be responsible for managing the day-to-day affairs of the
Sub-Adviser. Following the closing of the Acquisition, the Sub-Adviser will
become a wholly owned indirect corporate subsidiary of PNC Management &
Research, the holding company for PNC's asset management business.

PNC is a wholly owned indirect subsidiary of PNC Bank Corp., a publicly
owned multibank holding company incorporated under the laws of the
Commonwealth of Pennsylvania in 1983 and registered under the Federal Bank
Holding Company of 1956. PNC's banking subsidiaries are located in
Pennsylvania, Kentucky, Delaware, Ohio, Indiana and Massachusetts. As of June
30, 1994, PNC was ranked the eleventh largest bank holding company in the
U.S. based on total assets of $64 billion.

PNC provides a comprehensive range of financial products and services
including banking, corporate banking, investment banking and investment
management and trust. The banking subsidiaries of PNC engage in retail
banking, commercial banking, trust banking, investment management and other
financial services and securities-related activities. PNC's financial
services related subsidiaries provide a broad range of services including
investment advisory, securities brokerage, mortgage banking, credit card
processing, credit-related insurance underwriting, leasing and data
processing. PNC manages approximately $21.6 billion of mutual fund assets
across 53 portfolios in three mutual fund families.

The Current Sub-Advisory Agreement, as required by Section 15 of the
Investment Company Act of 1940, as amended (the "1940 Act"), provides for its
automatic termination in the event of its assignment. Any change of control
of the Sub-Adviser, including the sale of the Sub-Adviser to PNC pursuant to
the terms of the Acquisition, could be deemed to be an assignment and,
therefore, the automatic termination of the Current Sub-Advisory Agreement.

APPROVAL OF NEW SUB-ADVISORY AGREEMENT

In order to assure continuity of investment advisory services to the Trust
by the Sub-Adviser after the Acquisition, the Board met in person on October
20, 1994, for the purpose of considering whether it would be in the best
interests of the Trust and its shareholders for InterCapital to enter into a
new sub-advisory agreement with the Sub-Adviser (the "New Sub-Advisory
Agreement") to take effect upon consummation of the Acquisition. At its
meeting, and for the reasons discussed below (see "The Board's
Consideration"), the Board, including each of the Trustees who are not
"interested persons" of the Trust, as that term is defined in the 1940 Act
(the "Independent Trustees") , unanimously approved the New Sub-Advisory
Agreement and recommended it for approval by Shareholders. The New
Sub-Advisory Agreement is identical to the Current Sub-Advisory Agreement
except for the effective date and the stated expiration date.

THE BOARD, INCLUDING ALL OF THE INDEPENDENT TRUSTEES, RECOMMENDS THAT
SHAREHOLDERS APPROVE THE NEW SUB-ADVISORY AGREEMENT TO REPLACE THE CURRENT
SUB-ADVISORY AGREEMENT UPON CONSUMMATION OF THE ACQUISITION.

THE BOARD'S CONSIDERATION

At its meeting on October 20, 1994, the Board, including each of the
Independent Trustees, considered the possible effects on the Trust as a
result of the Acquisition and evaluated the New Sub-Advisory Agreement. The
Independent Trustees requested and received all information they deemed
necessary to their evaluation of the terms of the New Sub-Advisory Agreement.
In evaluating the effect of the Acquisition on the Sub-Adviser, the Board
viewed as significant the fact that the ability of the Sub-Adviser to
continue to provide quality investment advisory services will likely be
unaffected by the Acquisition because the members of Sub-Adviser's management
team have all agreed to sign long-term contracts with PNC and will continue
to be responsible for managing the day-to-day affairs of the Sub-Adviser. The
Board also took note of the financial resources available to the Sub-Adviser
through PNC subsequent to the Acquisition. The Board considered the nature,
quality and extent of services provided by the Sub-Adviser to the Trust and
the benefits derived by the Sub-Adviser. The Board also considered
comparative fees, expenses and performance information with respect to
investment companies similar to the Trust. In addition, the Board discussed
and reviewed the terms and provisions of the New Sub-Advisory Agreement.
Specifically, the Board noted that the fees payable under the New
Sub-Advisory Agreement are identical to the fees presently in effect under
the Current Sub-Advisory Agreement.

Based upon the Board's review and evaluations of these materials and its
consideration of all factors deemed relevant, the Board determined that the
New Sub-Advisory Agreement is reasonable, fair and in the best interests of
the Trust and its Shareholders. Accordingly, the Board, including all of the
Independent Trustees, approved the New Sub-Advisory Agreement and voted to
recommend its approval to the Trust's Shareholders.

THE SUB-ADVISORY AGREEMENT

The Current Sub-Advisory Agreement requires that the Sub-Adviser provide
the Trust with investment advisory services with respect to investments in
the Trust's portfolio securities and to obtain and evaluate such information
and advice relating to the economy, securities markets and securities as it
deems necessary or useful to discharge its duties under the Current
Sub-Advisory Agreement. Under the Current Sub-Advisory Agreement, the
Sub-Adviser is charged with the responsibility of making the determination as
to which securities the Trust should purchase or sell or otherwise dispose of
and with the timing of those decisions. All securities transactions are
periodically reviewed by the Investment Manager and are, in every instance,
subject to the overall supervision of the Investment Manager. The Trustees
review the portfolio of the Trust at their semiannual portfolio review
meetings.

The Current Sub-Advisory Agreement provides that the Sub-Adviser shall, at
its own expense, maintain such staff and employ or retain such personnel and
consult with such other persons as it shall, from time to time, determine to
be necessary or useful in the performance of its obligations under the
Current Sub-Advisory Agreement. The Sub-Adviser also bears other costs of
rendering the investment advisory services performed by it pursuant to the
Current Sub-Advisory Agreement, including such clerical help and bookkeeping
services as it may require.

In return for the services it renders under the Current Sub-Advisory
Agreement, the Sub-Adviser is paid by the Investment Manager monthly
compensation equal to 40% of the Investment Manager's compensation

receivable pursuant to the Investment Management Agreement. Any subsequent
change in the Investment Management Agreement which has the effect of raising
or lowering the compensation of the Investment Manager will have the
concomitant effect of raising or lowering the fee payable to the Sub-Adviser.
During the fiscal year ended October 31, 1994, the Investment Manager accrued
to the Sub-Adviser compensation under the Sub-Advisory Agreement of $ .

The Current Sub-Advisory Agreement provides that the operating expenses of
the Trust are subject to applicable limitations under rules and regulations
of states where the Trust is authorized to sell its shares. In the event the
operating expenses of the Trust, including amounts payable to the Investment
Manager pursuant to the Investment Management Agreement, exceed the expense
limitations applicable to the Trust imposed by the securities laws or
regulations thereunder, the Sub-Adviser will reduce its advisory fee to the
extent of 40% of such excess. During the fiscal year ended October 31, 1994,
the Trust's expenses did not exceed the expense limitations applicable to the
Trust.

The Investment Manager and Sub-Adviser have agreed, pursuant to the
Current Sub-Advisory Agreement, that neither the Investment Manager nor the
Sub-Adviser nor any of their affiliates which contain the names "Dean Witter"
or "BlackRock," respectively, will undertake to act as investment adviser or
sub-adviser for any U.S. registered open-end investment company other than
the Trust, which is sold primarily to retail investors and which utilizes the
same techniques utilized by the Sub-Adviser in connection with its
sub-advisory services to the Trust and whose investment objective and
policies and general asset allocation are the same as those of the Trust and
which is sponsored, distributed or managed by a U.S. registered broker-dealer
or one of its affiliates.

The Current Sub-Advisory Agreement provides that the Trust, to the full
extent permitted by applicable law, shall indemnify the Sub-Adviser and each
of the Sub-Adviser's partners, officers, employees and agents who was or is a
party or is threatened to be made a party to any threatened, pending, or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative (other than an action by or in the right of the Trust) by
reason of the fact that he is or was a Trustee, partner, officer, employee,
or agent of the Trust or the Sub-Adviser acting in its capacity as
Sub-Adviser (an "Indemnified Person"). The indemnification shall be against
expenses, including attorneys' fees, judgments, fines, and amounts paid in
settlement, actually and reasonably incurred by him in connection with the
action, suit, or proceeding, if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Trust, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.

The Current Sub-Advisory Agreement also provides that the Trust shall
indemnify any Indemnified Person who was or is a party or is threatened to be
made a party to any threatened, pending or completed action or suit by or on
behalf of the Trust to obtain a judgment or decree in its favor by reason of
the fact that he is or was a Trustee, officer, employee, or agent of the
Trust or the Sub-Adviser acting in its capacity as Sub-Adviser. The
indemnification shall be against expenses, including attorneys' fees actually
and reasonably incurred by him in connection with the defense or settlement
of the action or suit, if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Trust; except that no indemnification shall be made in respect of any claim,
issue, or matter as to which the person has been adjudged to be liable for
negligence or misconduct in the performance of his duty to the Trust, except
to the extent that the court in which the action or suit was brought, or a
court of equity in the county in which the Trust has its principal office,
determines upon application that, despite the adjudication of liability but
in view of all circumstances of the case, the person is fairly and reasonably
entitled to indemnity for those expenses which the court shall deem proper,
provided such Indemnified Person is not adjudged to be liable by reason of
his willful misfeasance, bad faith, gross negligence or reckless disregard of
the duties involved in the conduct of his office.

The Current Sub-Advisory Agreement provides that it shall continue in
effect until April 30, 1994 and that, after its initial period of
effectiveness, it will continue from year to year thereafter provided such
continuance is approved at least annually by the vote of a majority, as
defined in the 1940 Act, of the outstanding voting securities of the Trust or
by the Trustees of the Trust, and, in either event, by the vote cast in
person by a majority of such Trustees who are not parties to the Current
Sub-Advisory Agreement or "interested persons" of any such party (as defined
in the 1940 Act) at a meeting called for the purpose of voting on such
approval. The Current Sub-Advisory Agreement was last continued on April 8,
1994.

The Current Sub-Advisory Agreement also provides that it may be terminated
at any time by the Sub-Adviser, the Investment Manager, the Trustees of the
Trust or by a vote of the majority of the outstanding voting securities of
the Trust, in each instance without the payment of any penalty, on thirty
days notice and will automatically terminate upon assignment.

THE INVESTMENT MANAGER

Dean Witter InterCapital ("InterCapital") is the Trust's investment
manager. InterCapital maintains its offices at Two World Trade Center, New
York, New York 10048. InterCapital, which was incorporated in July, 1992 is a
wholly-owned subsidiary of Dean Witter, Discover & Co. ("DWDC"), a balanced
financial services organization providing a broad range of nationally
marketed credit and investment products. In an internal reorganization which
took place in January, 1993, InterCapital assumed the investment advisory,
management and administrative activities previously performed by the
InterCapital Division of DWR. InterCapital also manages and advises or
administers portfolios of other investment companies and pension plans and
other institutional and individual investors.

The Principal Executive Officers and Directors of InterCapital, and their
principal occupations, are:

Philip J. Purcell, Chairman of the Board of Directors and Chief Executive
Officer of DWDC and DWR and Director of InterCapital, Dean Witter Services
Company Inc. ("DWSC") and Distributors; Richard M. De Martini, President and
Chief Operating Officer of Dean Witter Capital and Director of DWSC, DWR,
Distributors and InterCapital; James F. Higgins, President and Chief
Operating Officer of Dean Witter Financial and Director of DWSC, DWR,
Distributors and InterCapital; Charles A. Fiumefreddo, Executive Vice
President and Director of DWR and Chairman of the Board of Directors and
Chief Executive Officer and Director of InterCapital, DWSC and Distributors;
Christine A. Edwards, Executive Vice President, Secretary, General Counsel
and Director of DWSC, DWR and Distributors, and Director of InterCapital; and
Thomas C. Schneider, Executive Vice President, Chief Financial Officer and
Director of DWSC, DWR, Distributors and InterCapital.

Messrs. Fiumefreddo and Purcell also serve as Trustees of the Trust.
Messrs. Fiumefreddo and Purcell, and certain other officers of the Trust own
securities of DWDC which, in the aggregate, constitute less than 1% of the
securities of each class outstanding.

The business address of the foregoing Directors and Executive Officers is
Two World Trade Center, New York, New York 10048.

InterCapital and its wholly-owned subsidiary, DWSC, serve in various
investment management advisory, management and administrative capacities to
investment companies and pension plans and other institutional and individual
investors. Appendix I lists the investment companies for which InterCapital
provides investment management or investment advisory services and sets forth
the net assets and fees payable by such companies.

DWDC has its offices at Two World Trade Center, New York, New York 10048.
There are various lawsuits pending against DWDC involving material amounts
which, in the opinion of its management, will be resolved with no material
effect on the consolidated financial position of the company.

THE SUB-ADVISER

The Sub-Adviser, BlackRock Financial Management L.P., formerly Blackstone
Financial Management L.P., is a Delaware limited partnership with offices at
345 Park Avenue, New York, New York 10154. The Sub-Adviser was organized in
April 1988 by Laurence D. Fink, Ralph L. Schlosstein and partners of The
Blackstone Group ("Blackstone"), a private investment bank. The Sub-Adviser's
general partner is BFM Management Partners L.P. ("BFM Management"), a
Delaware limited partnership. [Need to provide the address of BFM
Management]. The general partner of BFM Management is BFM Management Corp., a
Delaware corporation, whose stock is owned by Messrs. Fink and Schlosstein.
The Sub-Adviser currently serves as investment adviser to individual and
institutional fixed income investors in the United States and overseas
through several funds and separately managed accounts with combined total
assets in excess of $24 billion. The Sub-Adviser serves as investment manager
to the investment companies listed on Appendix II. Appendix II also sets
forth the net assets and fees payable by such companies for which the
Sub-Adviser provides investment advisory services.

The Principal Executive Officers and Directors of the Sub-Adviser and
their principal occupations are as follows The business address of the
foregoing Directors and Executive Officers is 345 Park Avenue, New York, NY
10154:

NAME POSITION
--------------------- -------------------------
CHAIRMAN OF THE BOARD AND

Laurence D. Fink Chief Executive Officer
Ralph L. Schlosstein President
Robert S. Kapito Vice Chairman
Henry Gabbay Chief Operating Officer

The Trust's policies regarding purchases and sales of securities for its
portfolio and its brokerage practices are described in Appendix III attached
to this Proxy Statement.

VOTE REQUIRED

The New Sub-Advisory Agreement must be approved at the Meeting by a
majority of outstanding voting securities of the Trust. Such a majority means
the affirmative vote of the holders of (a) 67% or more of the shares of the
Trust present, in person or by proxy, at the Meeting, if the holders of more
than 50% of the outstanding shares are so present, or (b) more than 50% of
the outstanding shares of the Trust, whichever is less. If so approved, the
New Sub-Advisory Agreement will become effective upon the closing of the
Acquisition and will continue in effect for an initial term expiring April
30, 1995. In the event the Shareholders do not approve the new Sub-Advisory
Agreement by the required majority vote, the Board will take such action as
it deems to be in the best interests of the Trust and its Shareholders, which
may include calling a special meeting of Shareholders to vote on another new
sub-advisory agreement.

ADDITIONAL INFORMATION

In the event that the necessary quorum to transact business at the Meeting
or the vote required to approve or reject any proposal is not obtained, the
persons named as proxies may propose one or more adjournments of the Meeting
for a total of not more than 60 days in the aggregate to permit further
solicitation of proxies. Any such adjournment will require the affirmative
vote of the holders of a majority of the Trust's shares present in person or
by proxy at the Meeting. The persons named as proxies will vote in favor of
such adjournment those proxies which they are entitled to vote in favor of
Proposal 1 and will vote against any such adjournment those proxies required
to be voted against that proposal.

SHAREHOLDERS PROPOSALS

The Trust does not hold regular shareholders meetings. Proposals of
Shareholders intended to be presented at the next meeting of Shareholders
must be received a reasonable time prior to the mailing of the proxy
materials sent in connection with the meeting, for inclusion in the proxy
statement for that meeting.

FINANCIAL STATEMENTS OF THE INVESTMENT
MANAGER AND THE SUB-ADVISER

The balance sheet of InterCapital, annexed hereto as Exhibit A, is
required by Rule 20a-2 under the 1940 Act, as is that of the Sub-Adviser,
annexed hereto as Exhibit B. THESE ARE NOT FINANCIAL STATEMENTS OF THE TRUST.
THE TRUST'S FINANCIAL STATEMENTS ARE SET FORTH IN ITS ANNUAL REPORT FOR THE
FISCAL YEAR ENDED OCTOBER 31, 1993, COPIES OF WHICH HAVE PRECEDED OR ARE
ENCLOSED WITH THIS PROXY STATEMENT.

OTHER BUSINESS

The management knows of no other matters which may be presented at the
Meeting. However, if any matters not now known properly come before the
Meeting, it is the intention of the persons named in the enclosed form of
proxy to vote all shares that they are entitled to vote on any such matter,
utilizing such proxy in accordance with their best judgment on such matters.

By Order of the Board of Trustees
SHELDON CURTIS
Secretary

APPENDIX I

InterCapital serves as investment manager or investment adviser to the
following investment companies, with the net assets shown as of October 20,
1994:

(1) Dean Witter High Yield Securities Inc., with assets of approximately
$500 million, for an investment management fee at an annual rate of 0.50% on
assets up to $500 million, scaled down at various asset levels to 0.30% on
assets over $3 billion; (2) Dean Witter Liquid Asset Fund Inc., with assets
of approximately $8.6 billion, for an investment management fee at an annual
rate of 0.50% on assets up to $500 million, scaled down at various asset
levels to 0.248% on assets over $17.5 billion; (3) Dean Witter Tax-Exempt
Securities Trust, with assets of approximately $1.4 billion, for an
investment management fee at an annual rate of 0.50% on assets up to $500
million, scaled down at various assets levels to 0.325% on assets over $1.25
billion; (4) Dean Witter Tax-Free Daily Income Trust, with assets of
approximately $604 million, for an investment management fee at an annual
rate of 0.50% on assets up to $500 million, scaled down at various asset
levels to 0.25% on assets over $3 billion; (5) Dean Witter American Value
Fund, with assets of approximately $1.4 billion, for an investment management
fee at an annual rate of 0.625% on assets up to $250 million and 0.50% on
assets over $250 million; (6) Dean Witter Dividend Growth Securities Inc.,
with assets of approximately $6.8 billion, for an investment management fee
at an annual rate of 0.625% on assets up to $250 million, scaled down at
various asset levels to 0.325% on assets over $8 billion; (7) Dean Witter
Variable Investment Series, with assets of approximately $2.7 billion, for an
investment management fee at an annual rate of 1.0% (of which 40% is paid to
a Sub-Adviser) of the net assets of each of the European Growth Portfolio and
the Pacific Growth Portfolio, 0.75% of the net assets of the Global Dividend
Growth Portfolio, 0.65% of the net assets of the Capital Growth Portfolio,
0.65% of the net assets of the Utilities Portfolio up to $500 million and
0.55% of the net assets of the Portfolio over $500 million, 0.625% of the net
assets of the Dividend Growth Portfolio up to $500 million and 0.50% of the
net assets of the Portfolio over $500 million, and 0.50% of the net assets of
each of the other five Portfolios; (8) Dean Witter Select Municipal
Reinvestment Fund, with assets of approximately $93 million, for an
investment management fee at an annual rate of 0.50%; (9) Active Assets Money
Trust, with assets of approximately $4.4 billion, for an investment
management fee at an annual rate of 0.50% on assets up to $500 million,
scaled down at various asset levels to 0.25% on assets over $3 billion; (10)
Active Assets Tax-Free Trust, with assets of approximately $1.5 billion, for
an investment management fee at an annual rate of 0.50% on assets up to $500
million, scaled down at various asset levels to 0.25% on assets over $3
billion; (11) Active Assets California Tax-Free Trust, with assets of
approximately $282 million, for an investment management fee of 0.50% on
assets up to $500 million, scaled down at various levels to 0.25% on assets
over $3 billion; (12) Active Assets Government Securities Trust, with assets
of approximately $512 million, for an investment management fee at an annual
rate of 0.50% on assets up to $500 million, scaled down at various asset
levels to 0.25% on assets over $3 billion; (13) Dean Witter Natural Resource
Development Securities Inc., with assets of approximately $147 million, for
an investment management fee at an annual rate of 0.625% on assets up to $250
million and 0.50% on assets over $250 million; (14) Dean Witter U.S.
Government Money Market Trust, with assets of approximately $769 million, for
an investment management fee at an annual rate of 0.50% on assets up to $500
million, scaled down at various asset levels to 0.25% on assets over $3
billion; (15) Dean Witter Developing Growth Securities Trust, with assets of
approximately $307 million, for an investment management fee at an annual
rate of 0.50% on assets up to $500 million and 0.475% on assets over $500
million; (16) Dean Witter U.S. Government Securities Trust, with assets of
approximately $10.1 billion, for an investment management fee at an annual
rate of 0.50% on assets up to $1 billion, scaled down at various asset levels
to 0.30% on assets over $12.5 billion; (17) Dean Witter California Tax-Free
Income Fund, with assets of approximately $1.1 billion, for an investment
management fee at an annual rate of 0.55% on assets up to $500 million,
scaled down at various asset levels to 0.475% on assets over $1 billion; (18)
Dean Witter New York Tax-Free Income Fund, with assets of approximately $231
million, for an investment management fee at an annual rate of 0.55% on
assets up to

I-1

$500 million and 0.525% on assets over $500 million; (19) Dean Witter
Convertible Securities Trust, with assets of approximately $190 million, for
an investment management fee at an annual rate of 0.60% on assets up to $750
million, scaled down at various asset levels to 0.425% on assets over $3
billion; (20) Dean Witter Federal Securities Trust, with assets of
approximately $927 million, for an investment management fee at an annual
rate of 0.55% on assets up to $1 billion, scaled down at various asset levels
to 0.35% on assets over $12.5 billion; (21) InterCapital Income Securities
Inc., with assets of approximately $212 million, for an investment management
fee at an annual rate of 0.50%; (22) Dean Witter Value-Added Market Series,
with assets of approximately $475 million, for an investment management fee
at an annual rate of 0.50% on assets up to $500 million and 0.45% on assets
over $500 million; (23) Dean Witter Utilities Fund, with assets of
approximately $3.3 billion, for an investment management fee at an annual
rate of 0.65% on assets up to $500 million, scaled down at various asset
levels to 0.425% on assets over $5 billion; (24) Dean Witter California
Tax-Free Daily Income Trust, with assets of approximately $604 million, for
an investment management fee at an annual rate of 0.50% on assets up to $500
million, scaled down at various asset levels to 0.25% on assets over $3
billion; (25) Dean Witter Managed Assets Trust, with assets of approximately
$305 million, for an investment management fee at an annual rate of 0.60% on
assets up to $500 million and 0.55% on assets over $500 million; (26) High
Income Advantage Trust, with assets of approximately $504 million, for an
investment management fee at an annual rate of 0.75% on assets up to $250
million, scaled down at various asset levels to 0.30% on assets over $1
billion; (27) High Income Advantage Trust II, with assets of approximately
$225 million, for an investment management fee at an annual rate of 0.75% on
assets up to $250 million, scaled down at various asset levels to 0.30% on
assets over $1 billion; (28) High Income Advantage Trust III, with assets of
approximately $86 million, for an investment management fee at an annual rate
of 0.75% on assets up to $250 million, scaled down at various asset levels to
0.30% on assets over $1 billion; (29) Dean Witter Strategist Fund, with
assets of approximately $806 million, for an investment management fee at an
annual rate of 0.60% on assets up to $500 million, scaled down at various
asset levels to 0.50% on assets over $1 billion; (30) Dean Witter
Intermediate Income Securities, with assets of approximately $246 million,
for an investment management fee at an annual rate of 0.60% on assets up to
$500 million, scaled down at various asset levels to 0.30% on assets over $1
billion; (31) Dean Witter World Wide Income Trust, with assets of
approximately $201 million, for an investment management fee at an annual
rate of 0.75% on assets up to $250 million, scaled down at various asset
levels to 0.30% on assets over $1 billion; (32) Dean Witter Government Income
Trust, with assets of approximately $504 million, for an investment
management fee at an annual rate of 0.60%; (33) Dean Witter New York
Municipal Money Market Trust, with assets of approximately $44 million, for
an investment management fee at an annual rate of 0.50% on assets up to $500
million, scaled down at various asset levels to 0.25% on assets over $3
billion; (34) Dean Witter European Growth Fund Inc., with assets of
approximately $693 million, for an investment management fee at an annual
rate of 1.0% on assets up to $500 million and 0.95% on assets over $500
million (of which 40% is paid to a Sub-Adviser); (35) Dean Witter Capital
Growth Securities, with assets of approximately $485 million, for an
investment management fee at an annual rate of 0.65% on assets up to $500
million, scaled down at various asset levels to 0.475% on assets over $1.5
billion; (36) Dean Witter Precious Metals and Minerals Trust, with assets of
approximately $68 million, for an investment management fee at an annual rate
of 0.80%; (37) Dean Witter Global Short-Term Income Fund Inc., with assets of
approximately $198 million, for an investment management fee at an annual
rate of 0.55% on assets up to $500 million and 0.50% on assets over $500
million; (38) Dean Witter Pacific Growth Fund Inc., with assets of
approximately $1.4 billion, for an investment management fee at an annual
rate of 1.0% on assets up to $1 billion and 0.95% on assets over $1 billion
(of which 40% is paid to a Sub-Adviser); (39) InterCapital Insured Municipal
Bond Trust, with assets of approximately $119 million, for an investment
management fee at an annual rate of 0.35%; (40) InterCapital Quality
Municipal Investment Trust, with assets of approximately $418 million, for an
investment management fee at an annual rate of 0.35%; (41) InterCapital
Insured Municipal Trust, with assets of approximately $540 million, for an
investment management fee at an annual rate of 0.35%; (42) InterCapital
Quality Municipal

I-2

Income Trust, with assets of approximately $847 million, for an investment
management fee at an annual rate of 0.35%; (43) Dean Witter Multi-State
Municipal Series Trust, with assets of approximately $466 million, for an
investment management fee at an annual rate of 0.35% of the net assets of
each Series; (44) Dean Witter Premier Income Trust, with assets of
approximately $51 million, for an investment management fee at an annual rate
of 0.50% (of which 40% is paid to a Sub-Adviser); (45) Dean Witter Short-Term
U.S. Treasury Trust, with assets of approximately $463 million, for an
investment management fee at an annual rate of 0.35%; (46) Dean Witter
Diversified Income Trust, with assets of approximately $392 million, for an
investment management fee at an annual rate of 0.40%; (47) Dean Witter Health
Sciences Trust, with assets of approximately $229 million, for an investment
management fee at an annual rate of 1.0%; (48) Dean Witter Retirement Series,
with assets of approximately $38 million, for an investment management fee at
an annual rate of 1.0% of the net assets of the Global Equity Series, 0.85%
of the net assets of each of the American Value Series, the Capital Growth
Series and the Strategist Series, 0.75% of the net assets of each of the
Dividend Growth Series and the Utilities Series, 0.65% of the net assets of
each of the U.S. Government Securities Series and the Intermediate Income
Securities Series, and 0.50% of the net assets of each of the Liquid Asset
Series, the U.S. Government Money Market Series and the Value-Added Market
Series; (49) InterCapital Insured Municipal Income Trust, with assets of
approximately $540 million, for an investment management fee at an annual
rate of 0.35%; (50) InterCapital California Insured Municipal Income Trust,
with assets of approximately $273 million, for an investment management fee
at an annual rate of 0.35%; (51) Dean Witter Global Dividend Growth
Securities, with assets of approximately $1.4 billion, for an investment
management fee at an annual rate of 0.75%; (52) InterCapital Quality
Municipal Securities, with assets of approximately $441 million, for an
investment management fee at an annual rate of 0.35%; (53) InterCapital
California Quality Municipal Securities, with assets of approximately $229
million, for an investment management fee at an annual rate of 0.35%; (54)
InterCapital New York Quality Municipal Securities, with assets of
approximately $104 million, for an investment management fee at an annual
rate of 0.35%; (55) Dean Witter Limited Term Municipal Trust, with assets of
approximately $135 million, for an investment management fee at an annual
rate of 0.50%; (56) Dean Witter Short-Term Bond Fund, with assets of
approximately $45 million, for an investment management fee at an annual rate
of 0.70%; (57) InterCapital Insured Municipal Securities, with assets of
approximately $146 million, for an investment management fee at an annual
rate of 0.35%; (58) InterCapital Insured California Municipal Securities,
with assets of approximately $64 million, for an investment management fee at
an annual rate of 0.35%; (59) Municipal Income Trust, with assets of
approximately $333 million, for an investment advisory fee at an annual rate
of 0.35% on assets up to $250 million and 0.25% on assets over $250 million;
(60) Municipal Income Trust II, with assets of approximately $288 million,
for an investment advisory fee at an annual rate of 0.40% on assets up to
$250 million and 0.30% on assets over $250 million; (61) Municipal Income
Trust III, with assets of approximately $64 million, for an investment
advisory fee at an annual rate of 0.40% on assets up to $250 million and
0.30% on assets over $250 million; (62) Municipal Income Opportunities Trust,
with assets of approximately $181 million, for an investment advisory fee at
an annual rate of 0.50%; (63) Municipal Income Opportunities Trust II, with
assets of approximately $177 million, for an investment advisory fee at an
annual rate of 0.50%; (64) Municipal Income Opportunities Trust III, with
assets of approximately $108 million, for an investment advisory fee at an
annual rate of 0.50%; (65) Municipal Premium Income Trust, with assets of
approximately $394 million, for an investment advisory fee at an annual rate
of 0.40%; (66) Prime Income Trust, with assets of approximately $283 million,
for an investment advisory fee at an annual rate of 0.90% on assets up to
$500 million and 0.85% on assets over $500 million; (67) Dean Witter Global
Utilities Fund, with assets of approximately $252 million, for an investment
management fee at an annual rate of 0.65%; (68) Dean Witter National
Municipal Securities, with assets of approximately $19 million, for an
investment advisory fee at an annual rate of 0.35%; (69) Dean Witter High
Income Securities, with assets of approximately $48 million, for an
investment advisory fee at an annual rate of 0.50%; (70) Dean Witter
International SmallCap Fund, with assets of approximately $77 million, for an
investment advisory fee at an annual rate of

I-3

1.25%; (71) Dean Witter Mid-Cap Growth Fund, with assets of approximately $75
million, for an investment advisory fee at an annual rate of 0.75%; and (72)
Dean Witter Select Dimensions Investment Series, a new investment company, for
an investment management fee at an annual rate of 0.625% of
the net assets of each of the Dividend Growth Portfolio and the American
Value Portfolio, 0.40% of the net assets of the Diversified Income Portfolio,
0.50% of the net assets of each of the Money Market Portfolio, the
Value-Added Market Series Portfolio and the Developing Growth Portfolio,
0.65% of the net assets of each of the North American Government Securities
Portfolio and the Utilities Portfolio, 0.75% of the net assets of the
Balanced Portfolio, 0.85% of the net assets of Core Equity Portfolio, 1.00%
of the net assets of the Global Equity Portfolio and 1.25% of the net assets
of the Emerging Markets Portfolio. InterCapital also serves as Investment
Adviser of Dean Witter World Wide Investment Trust and Dean Witter World Wide
Investment Fund, along with Daiwa International Capital Management Corp. and
NatWest Investment Management Limited. Dean Witter World Wide Investment
Trust had assets of approximately $570 million and InterCapital receives an
Investment Adviser's fee at an annual rate of 0.55% of the Trust's daily net
assets up to $500 million and 0.5225% of the Trust's daily net assets over
$500 million. Shares of Dean Witter World Wide Investment Fund, an investment
company organized under the laws of Luxembourg, are not offered for purchase
in the United States or to American citizens outside of the United States.
InterCapital also serves as sub-adviser to Templeton Global Opportunities
Trust, with assets of approximately $487 million, for which it receives a fee
of 0.25% per annum.

I-4

APPENDIX II

BlackRock Financial Management L.P. serves as investment adviser or
subadviser for the following registered investment companies:

NET ASSETS AS CURRENT
OF 8/31/94 (IN ADVISORY FEE
ADVISER: THOUSANDS) RATE
--------------- --------------

THE BLACKROCK INCOME TRUST INC.* ................................ 473,305 0.65%
THE BLACKROCK TARGET TERM TRUST INC.* ........................... 901,373 0.45% (1)
THE BLACKROCK ADVANTAGE TERM TRUST INC.* ........................ 91,588 0.60% (2)
THE BLACKROCK STRATEGIC TERM TRUST INC.* ........................ 488,681 0.60% (3)
THE BLACKROCK 1998 TERM TRUST INC.* ............................. 545,089 0.50% (4)
THE BLACKROCK NORTH AMERICAN GOVERNMENT INCOME TRUST INC.* ..... 372,104 0.60%
THE BLACKROCK INVESTMENT QUALITY TERM TRUST INC.* ............... 318,083 0.60% (5)
THE BLACKROCK 1999 TERM TRUST INC.* ............................. 188,369 0.40%
THE BLACKROCK 2001 TERM TRUST INC.* ............................. 1,194,763 0.40%
THE BLACKROCK BROAD INVESTMENT GRADE 2009 TERM TRUST INC.* ..... 36,753 0.55%
THE BLACKROCK MUNICIPAL TARGET TERM TRUST INC.* ................. 478,333 0.35% (6)
THE BLACKROCK INSURED MUNICIPAL TERM TRUST INC.* ................ 267,928 0.35% (6)
THE BLACKROCK INSURED MUNICIPAL 2008 TERM TRUST INC.* .......... 403,332 0.35% (6)
THE BLACKROCK INVESTMENT QUALITY MUNICIPAL TRUST INC.* ......... 218,730 0.35% (6)
THE BLACKROCK CALIFORNIA INSURED MUNICIPAL 2008 TERM TRUST INC.* 152,902 0.35% (6)
THE BLACKROCK NEW YORK INSURED MUNICIPAL 2008 TERM TRUST INC.* . 166,267 0.35% (6)
THE BLACKROCK FLORIDA INSURED MUNICIPAL 2008 TERM TRUST INC.* .. 128,229 0.35% (6)
THE BLACKROCK FLORIDA INVESTMENT QUALITY MUNICIPAL TRUST INC.* . 14,478 0.35% (6)
THE BLACKROCK CALIFORNIA INVESTMENT QUALITY MUNICIPAL TRUST
INC.* .......................................................... 12,975 0.35% (6)
THE BLACKROCK NEW YORK INVESTMENT QUALITY MUNICIPAL TRUST INC.* 16,767 0.35% (6)
THE BLACKROCK NEW JERSEY INVESTMENT QUALITY MUNICIPAL TRUST
INC.* .......................................................... 12,796 0.35% (6)
THE BFM INSTITUTIONAL TRUST INC.** .............................. 0.30% (7)
INVESTMENT SUBADVISER:
THE BLACKROCK GOVERNMENT INCOME TRUST INC.** .................... 64,924 0.25%
DEAN WITTER PREMIER INCOME TRUST** .............................. 49,915 0.20%
SMITH BARNEY SHEARSON ADJUSTABLE RATE GOVERNMENT INCOME FUND** . 242,952 0.20%
ACCESSOR FUNDS, INC.--MORTGAGE SECURITIES PORTFOLIO** .......... 33,324 0.25% (8)
FRANK RUSSELL INVESTMENT COMPANY** .............................. 82,752 0.25% (9)
US AFFINITY TAX-FREE MUNICIPAL FUND** ........................... 2,120 0.20%(10)
<FN>
* Closed-End Registered Investment Company

** Open-End Registered Investment Company

(1) This advisory fee rate remains in effect until December 31, 1996.
Thereafter, the advisory fee rate changes to .30% per annum until the
fund terminates on or about December 31, 2000. From inception through
December 31, 1992 the advisory fee rate was .60%.

(2) This advisory fee rate remains in effect until December 31, 1995. From
January 1, 1996 until December 31, 2000, the advisory fee rate changes
to .50% per annum. Thereafter, the advisory fee rate changes to .40%
per annum until the fund terminates on or about December 31, 2005.

(3) This advisory fee rate remains in effect until December 31, 1994. From
January 1, 1995 until December 31, 1998, the advisory fee rate changes
to .45% per annum. Thereafter, the advisory fee rate changes to .30%
per annum until the fund terminates on or about December 31, 2002.

(4) This advisory fee rate remains in effect until December 31, 1994. From
January 1, 1995 until December 31, 1996, the advisory fee rate changes
to .40% per annum. Thereafter, the advisory fee rate changes to .30%
per annum until the fund terminates on or about December 31, 1998.

(5) This advisory fee rate remains in effect until December 31, 1998. From
January 1, 1999 until December 31, 2002, the advisory fee rate changes
to .50% per annum. Thereafter, the advisory fee rate changes to .40%
per annum until the fund terminates on or about December 31, 2004.

(6) The advisory fee rate is calculated as a percentage of total
investment assets for these funds.

(7) The BlackRock Institutional Trust is a series of no-load, open-end
mutual funds which currently consist of the Short Duration Portfolio
and the Core Fixed Income Portfolio. The Short Duration Portfolio's
advisory fee rate is .30%, while the Core Fixed Income Portfolio's
advisory fee rate is .35%. However the adviser currently has agreed to
waive .05% of the Core Fixed Income Portfolio's fee.

(8) Maximum fee that can be earned is .25% (Portion of fee is fixed and
balance based on performance).

(9) .25% of 1st $100 Million and .20% in excess of $100 Million.

(10) .20% of the funds average daily net assets up to $100 Million, .15%
next $200 Million, .125% of the next $300 Million, .10% of the next
$400 Million and .075% of such assets in excess of $1 Billion.

APPENDIX III

PORTFOLIO TRANSACTIONS AND BROKERAGE

Subject to the general supervision of the Board, the Investment Manager
and the Sub-Adviser are responsible for the investment decisions and the
placing of the orders for portfolio transactions for the Trust. The Trust's
portfolio transactions will occur primarily with issuers, underwriters or
major dealers acting as principals. Such transactions are normally on a net
basis and do not involve payment of brokerage commissions. The cost of
securities purchased from an underwriter usually includes a commission paid
by the issuer to the underwriters; transactions with dealers normally reflect
the spread between bid and asked prices. Options and futures transactions
will usually be effected through a broker and a commission will be charged.
During the fiscal year ended October 31, 1994, the Trust did not pay any
brokerage commissions.

The Investment Manager and the Sub-Adviser currently serve as investment
manager to a number of clients, including other investment companies, and may
in the future act as investment manager or adviser to others. It is the
practice of the Investment Manager and the Sub-Adviser to cause purchase or
sale transactions to be allocated among the Trust and others whose assets it
manages in such manner as it deems equitable. In making such allocations
among the Trust and other client accounts, the main factors considered are
the respective investment objectives, the relative size of portfolio holdings
of the same or comparable securities, the availability of cash for
investment, the size of investment commitments generally held and the
opinions of the persons responsible for managing the portfolios of the Trust
and other client accounts.

The policy of the Trust regarding purchases and sales of securities and
futures contracts for its portfolio is that primary consideration will be
given to obtaining the most favorable prices and efficient execution of
transactions. In seeking to implement the Trust's policies, the Investment
Manager and the Sub-Adviser effect transactions with those brokers and
dealers who the Investment Manager and the Sub-Adviser believe provide the
most favorable prices and are capable of providing efficient executions. If
the Investment Manager or the Sub-Adviser believes such price and execution
are obtainable from more than one broker or dealer, it may give consideration
to placing portfolio transactions with those brokers and dealers who also
furnish research and other services to the Trust or the Investment Manager
and/or the Sub-Adviser. Such services may include, but are not limited to,
any one or more of the following: information as to the availability of
securities for purchase or sale; statistical or factual information or
opinions pertaining to investment; wire services; and appraisals or
evaluations of portfolio securities. In transactions effected with a dealer,
acting as principal, who furnishes research services to the Trust, the Trust
will not purchase securities at a higher price, or sell securities at a lower
price, than would be the case if the dealer had not furnished such services.

The information and services received by the Investment Manager and the
Sub-Adviser from brokers and dealers may be of benefit to the Investment
Manager and the Sub-Adviser in the management of accounts of some of its other
clients and may not in all cases benefit the Trust directly. While the
receipt of such information and services is useful in varying degrees and
would generally reduce the amount of research or services otherwise performed
by the Investment Manager and the Sub-Adviser and thereby reduce its
expenses, it is of indeterminable value and the fees paid to the Investment
Manager and the Sub-Adviser are not reduced by any amount that may be
attributable to the value of such services.

Pursuant to an order of the Securities and Exchange Commission, the Trust
may effect principal transactions in certain money market instruments with
DWR. The Trust will limit its transactions with DWR to U.S. Government and
Government Agency Securities, Bank Money Instruments (i.e., Certificates of
Deposit and Bankers' Acceptances) and Commercial Paper. Such Transactions
will be effected with DWR only when the price available from DWR is better
than that available from other dealers.

III-1

Consistent with the policy described above, brokerage transactions in
securities listed on exchanges or admitted to unlisted trading privileges may
be effected through DWR. In order for DWR to effect portfolio transactions
for the Trust, the commissions, fees or other remuneration received by DWR
must be reasonable and fair compared to the commissions, fees or other
remuneration paid to other brokers in connection with comparable transactions
involving similar securities being purchased or sold on an exchange during a
comparable period of time. This standard would allow DWR to receive no more
than the remuneration which would be expected to be received by an
unaffiliated broker in a commensurate arm's-length transaction. Furthermore,
the Board, including a majority of the Independent Trustees, have adopted
procedures which are reasonably designed to provide that any commissions,
fees or other remuneration paid to DWR are consistent with the foregoing
standard. During the fiscal period ended October 31, 1993, the Trust paid no
brokerage commissions to DWR.

Section 11(a) of the Securities Exchange Act of 1934 generally limits
members of United States national securities and exchanges from executing
exchange transactions for their affiliates and institutional accounts which
they manage. Section 11(a)(1)(H) permits such exchange members to perform
functions other than executions in connection with securities transactions on
an exchange only if the affiliate or account expressly authorizes such member
to effect such transactions. To the extent Section 11(a) would apply to DWR
acting as broker for the Trust in any of its portfolio transactions executed
on any such securities exchange of which it is a member, appropriate
authorizations have been given.

III-2

EXHIBIT A

INDEPENDENT AUDITORS' REPORT

Board of Directors and Stockholders of
Dean Witter InterCapital Inc.:

We have audited the accompanying balance sheet of Dean Witter InterCapital
Inc. (the "Company") (a wholly-owned subsidiary of Dean Witter, Discover &
Co. ) as of December 31, 1993. This financial statement is the responsibility
of the Company's management. Our responsibility is to express an opinion on
this financial statement based on our audit.

We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statement is free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statement. 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 audit provides a reasonable basis
for our opinion.

In our opinion, such balance sheet presents fairly, in all material
respects, the financial position of Dean Witter InterCapital at December 31,
1993 in conformity with generally accepted accounting principles.

DELOITTE & TOUCHE LLP
February 28, 1994

A-1

DEAN WITTER INTERCAPITAL INC.
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1993
(IN THOUSANDS)

ASSET
Cash and cash equivalents ........................................................... $ 57,810
Management and administration fees receivable ....................................... 27,010
Investments ......................................................................... 7,644
Office facilities, at cost (less accumulated depreciation and amortization of
$5,122) ............................................................................ 3,892
Other assets ........................................................................ 18,176
----------
$114,532
==========
LIABILITIES AND STOCKHOLDER'S EQUITY
Income taxes payable (Note 3) ....................................................... $ 45,545
Dividends payable ................................................................... 12,662
Accrued compensation and employee benefits .......................................... 12,337
Payable to affiliate ................................................................ 4,000
Other liabilities ................................................................... 14,998
----------
Total liabilities ............................................................... 89,532
----------
Stockholder's equity:
Common stock, $.01 par value; 1,000 shares authorized and outstanding ............. --
Additional paid-in capital ......................................................... 10,000
Retained earnings .................................................................. 15,000
----------
Total stockholder's equity ...................................................... 25,000
----------
$114,532
==========

See notes to consolidated balance sheet.

A-2

DEAN WITTER INTERCAPITAL INC.
NOTES TO CONSOLIDATED BALANCE SHEET

1. INTRODUCTION AND BASIS OF PRESENTATION

The consolidated balance sheet includes the accounts of Dean Witter
InterCapital Inc. and its wholly-owned subsidiaries (the "Company"). The
Company is wholly-owned by Dean Witter, Discover & Co. ("DWDC"), which was
formerly a subsidiary of Sears, Roebuck and Co. ("Sears"). All material
intercompany balances and transactions with its subsidiaries have been
eliminated.

On March 1, 1993, DWDC completed an initial public offering of 33.8
million shares of its common stock at $27 per share. This transaction had the
effect of reducing Sears ownership in DWDC to 80.1 percent. On June 30, 1993,
Sears divested its remaining ownership of DWDC's common stock by means of a
special dividend to Sears shareholders.

On December 22, 1993, Dean Witter Reynolds Inc. ("DWR") transferred the
net assets of the Company in the form of a dividend to DWDC. Prior to
December 22, 1993, the Company was wholly-owned by DWR, a wholly-owned
subsidiary of DWDC.

The Company is a registered investment adviser under the Investment
Advisers Act of 1940. The Company sponsors and performs management and
administrative services for mutual funds, principally those sold by DWR ("DWR
funds"). The Company also performs such services for individual,
institutional, trust and estate accounts.

The Company commenced operations in January 1993 and assumed the advisory
business of DWR.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Cash equivalents consist of highly liquid investments not held for resale
with maturities, when purchased, of three months or less.

Fixed assets are generally depreciated utilizing accelerated methods over
useful lives of five to eight years. Leasehold improvements are amortized
over the lesser of the lease term or useful life.

3. INCOME TAXES

The Company provides deferred income taxes which result from recording
certain transactions in different years for tax and financial reporting
purposes.

Payments for income taxes are limited to those which would result from the
Company filing a separate federal income tax return.

The Company has available net operating loss carryforwards at December 31,
1993 in the amount of $112,200,000 which begin to expire in 2002.

4. RELATED PARTY TRANSACTIONS

Certain administrative services are provided by DWR which are reimbursed
by the Company.

5. EMPLOYEE BENEFIT PLANS

Substantially all employees are covered by a non-contributory defined
benefit pension plan sponsored by DWR. Pension benefits are based on length
of service and average annual compensation.

A-3

Certain employees are covered by postretirement plans sponsored by DWR
that provide medical and life insurance for retirees and eligible dependents.
Eligibility for retiree medical and life benefits is generally based on a
combination of age and years of service at retirement.

The Company reimburses DWR for pension and other postretirement benefit
expenses.

6. LITIGATION

The Company has been named as a defendant in various lawsuits. It is the
opinion of management, after consultation with outside counsel, that the
resolution of such suits will not have a material adverse effect on the
consolidated financial condition of the Company.

7. FINANCIAL INSTRUMENTS FAIR VALUE INFORMATION

The estimated fair value amounts of financial instruments have been
determined by the Company using available market information and appropriate
valuation methodologies. Considerable judgment is required to develop
estimates of fair value.

Substantially all financial instruments on the Company's consolidated
balance sheet are carried at fair value or at amounts which approximate fair
value.

A-4

EXHIBIT B

BLACKROCK FINANCIAL MANAGEMENT L.P.

CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
AS OF DECEMBER 31, 1993
ASSETS

Cash and cash equivalents ..$ 7,931,040
Accounts receivable ......... 6,503,904
Investments, at market value 2,213,199
Property and equipment, net 3,827,819
Other assets ................ 1,642,528
------------
Total assets ............ $22,118,490
============

LIABILITIES AND PARTNERS' INTERESTS

Liabilities:
Accounts payable and accrued expenses ...... $14,814,444
Payable to affiliates ....................... 486,679
-------------
Total liabilities ........................ 15,301,123
-------------
Partners' interests:
Subordinated notes .......................... 1,477,674
Partners' capital:
General partner ............................ 2,898,340
Limited partners ........................... 2,441,353
-------------
Total partners' interests ................ 6,817,367
-------------
Total liabilities and partners'
interests ................................... $22,118,490
=============

See notes to consolidated statement of financial condition.

B-1

BLACKROCK FINANCIAL MANAGEMENT L.P.

NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION

1. THE PARTNERSHIP

BlackRock Financial Management L.P. ("BFM") provides investment management
services to registered investment companies, offshore funds and private
accounts for both domestic and international clients and portfolio advisory
services to companies in the financial services industry. The general partner
of BFM is BFM Management Partners L.P. ("BFM Management"). The general
partner of BFM Management is BFM Management Corp. Effective as of January 1,
1993, there was a reorganization of partnership interests in which certain
general and limited partners transferred their partnership interests to BFM
Management. Net income (loss) of BFM is allocated to its partners based on
specific profit sharing allocations.
BFM owns a 99% limited partnership interest in BFM International L.P. ("BFM
I") which provides investment management services for internationally based
clients. BFM International Inc. is the general partner of BFM I and is
controlled by certain partners of BFM.

2. SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation
The consolidated statement of financial condition includes the accounts of
BFM and BFM I (the "Partnership"). All interpartnership accounts have been
eliminated.
Cash and Cash Equivalents
The Partnership has defined cash and cash equivalents as cash and short-term,
highly liquid investments with maturities of three months or less.
Revenue Recognition
Investment management fees are recognized as earned under the Partnership's
Investment Advisory Agreements ("Agreements"). Under the Agreements,
investment management fees paid to the Partnership are based on a percentage
of the net assets managed by the Partnership. Under the Partnership's
portfolio advisory agreements, revenues are recognized over the terms of such
agreements.
Financial Instruments
Financial instruments are carried at fair value or at amounts which
approximate fair value. Cash and cash equivalents, accounts receivable and
payable to affiliates are carried at cost which approximates fair value.
Investments, consisting of shares of registered investment companies managed
by the Partnership, are valued at their quoted market value.
Property and Equipment
Property and equipment is recorded at cost. Depreciation is generally
provided on the straight-line method over an estimated useful life of five
years.
Income Taxes
Effective January 1, 1993, the Partnership adopted Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes". This change had
no significant impact on the consolidated statement of financial condition.

B-2

BLACKROCK FINANCIAL MANAGEMENT L.P.

NOTES TO CONSOLIDATED STATEMENT OF FINANCIAL CONDITION

3. PROPERTY AND EQUIPMENT

Property and equipment consists of the following:

Office and computer equipment $3,771,099
Furniture and fixtures ....... 1,302,349
Leasehold improvements ....... 144,157
------------
5,217,605
Less accumulated depreciation 1,389,786
------------
Property and equipment, net $3,827,819
============

4. SUBORDINATED NOTES

Under the terms of the BFM partnership agreement, a portion of undistributed
net operating income (as defined in the partnership agreement) is converted
into subordinated notes. Each subordinated note bears interest at LIBOR plus
1 percent per annum, payable semi-annually, and shall mature five years from
the date of issuance, subject to extension.

5. COMMITMENTS

The Partnership and an affiliate have an agreement, expiring in 1999, to
lease the Partnership's primary office space. Future minimum commitments
under this agreement, net of rental reimbursements from affiliates, are as
follows:

1994 ........$1,296,054
1995 ........ 1,317,396
1996 ........ 1,317,396
1997 ........ 1,317,396
1998 ........ 1,317,396
Thereafter . 219,783
------------
$6,785,421
============

Under the lease agreement, the Partnership and an affiliate are responsible
for certain escalation payments.

B-3

INDEPENDENT AUDITORS' REPORT

To the Partners of
BlackRock Financial Management L.P.:

We have audited the accompanying consolidated statement of financial
condition of BlackRock Financial Management L.P. and subsidiary (the
"Partnership") as of December 31, 1993. This financial statement is the
responsibility of the Partnership's management. Our responsibility is to
express an opinion on this financial statement based on our audit.

In our opinion, such consolidated financial statement presents fairly, in all
material respects, the financial position of BlackRock Financial Management
L.P. and subsidiary at December 31, 1993 in conformity with generally
accepted accounting principles.
DELOITTE & TOUCHE LLP
New York, New York
February 18, 1994

B-4

DEAN WITTER PREMIER INCOME TRUST
SPECIAL MEETING OF SHAREHOLDERS--DECEMBER 22, 1994

PROXY

The undersigned hereby appoints EDMUND C. PUCKHABER, SHELDON CURTIS,
ROBERT M. SCANLAN, or any of them, proxies, each with the power of
substitution, to vote on behalf of the undersigned at the Special Meeting of
Shareholders of the DEAN WITTER PREMIER INCOME TRUST on December 22, 1994 at
10:00 a.m., New York City time, and at any adjournment thereof, on the
proposal set forth in the Notice of Meeting dated October 31, 1994:

THIS PROXY IS SOLICITED BY THE TRUSTEES. THE TRUSTEES RECOMMEND A VOTE FOR
THE PROPOSAL LISTED ON THE REVERSE SIDE HEREOF. THE SHARES REPRESENTED HEREBY
WILL BE VOTED AS INDICATED OR FOR IF NO CHOICE IS INDICATED.

(Continued, and to be dated and signed on reverse side.)

1. APPROVAL OF NEW SUB-ADVISORY AGREEMENT BETWEEN DEAN WITTER INTERCAPITAL
INC. AND BLACKROCK FINANCIAL MANAGEMENT L.P.:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
and in their discretion in the transaction of any other business which may
properly come before the meeting.
062
Please sign personally. If the share is registered in more than one name,
each joint owner or each fiduciary should sign personally. Only authorized
officers should sign for corporations.
Dated
-------------------

-------------------
Signature

IMPORTANT: PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD IN THE ENCLOSED
ENVELOPE.