<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 16, 2000
REGISTRATION NOS.: 2-74980
811-3326
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM N-1A
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933 /X/
PRE-EFFECTIVE AMENDMENT NO. / /
POST-EFFECTIVE AMENDMENT NO. 21 /X/
AND/OR
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY
ACT OF 1940 /X/
AMENDMENT NO. 22 /X/
------------------------
MORGAN STANLEY DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST
(A MASSACHUSETTS BUSINESS TRUST)
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
TWO WORLD TRADE CENTER
NEW YORK, NEW YORK 10048
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (212) 392-1600
BARRY FINK, ESQ.
TWO WORLD TRADE CENTER
NEW YORK, NEW YORK 10048
(NAME AND ADDRESS OF AGENT FOR SERVICE)
------------------------------
COPY TO:
STUART M. STRAUSS, ESQ.
MAYER BROWN & PLATT
1675 BROADWAY
NEW YORK, NEW YORK 10019
--------------------
APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING:
As soon as practicable after this Post-Effective Amendment becomes effective.
IT IS PROPOSED THAT THIS FILING WILL BECOME EFFECTIVE (CHECK APPROPRIATE BOX)
___ immediately upon filing pursuant to paragraph (b)
_X_ on March 20, 2000 pursuant to paragraph (b)
___ 60 days after filing pursuant to paragraph (a)
___ on (date) pursuant to paragraph (a) of rule 485.
AMENDING THE PROSPECTUS AND UPDATING FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PROSPECTUS - MARCH 20, 2000
Morgan Stanley Dean Witter
U.S. GOVERNMENT MONEY MARKET TRUST
[COVER PHOTO]
A MONEY MARKET FUND THAT SEEKS TO PROVIDE
SECURITY OF PRINCIPAL, HIGH CURRENT
INCOME AND LIQUIDITY
The Securities and Exchange Commission has not approved or disapproved these
securities or passed upon
the adequacy of this PROSPECTUS. Any representation to the contrary is a
criminal offense.
<PAGE>
CONTENTS
<TABLE>
<S> <C> <C>
The Fund Investment Objectives................................. 1
Principal Investment Strategies....................... 1
Principal Risks....................................... 2
Past Performance...................................... 3
Fees and Expenses..................................... 3
Fund Management....................................... 4
Shareholder Information Pricing Fund Shares................................... 5
How to Buy Shares..................................... 5
How to Exchange Shares................................ 7
How to Sell Shares.................................... 9
Distributions......................................... 12
Tax Consequences...................................... 12
Financial Highlights ...................................................... 14
Financial Statements --
January 31, 2000 ...................................................... 15
Our Family of Funds ...................................................... Inside Back Cover
THIS PROSPECTUS CONTAINS IMPORTANT INFORMATION ABOUT THE FUND. PLEASE READ
IT CAREFULLY AND KEEP IT FOR FUTURE REFERENCE.
</TABLE>
<PAGE>
[Sidebar]
MONEY MARKET
A MUTUAL FUND HAVING THE GOAL TO SELECT SECURITIES TO PROVIDE CURRENT INCOME
WHILE SEEKING TO MAINTAIN A STABLE SHARE PRICE OF $1.00.
YIELD
THE FUND'S YIELD REFLECTS THE ACTUAL INCOME THE FUND PAYS TO YOU EXPRESSED AS A
PERCENTAGE OF THE FUND'S SHARE PRICE. BECAUSE THE FUND'S INCOME FROM ITS
PORTFOLIO SECURITIES WILL FLUCTUATE, THE INCOME IT IN TURN DISTRIBUTES TO YOU
AND THE FUND'S YIELD WILL VARY.
[End Sidebar]
THE FUND
[ICON] INVESTMENT OBJECTIVES
- --------------------------------------------------------------------------------
Morgan Stanley Dean Witter U.S. Government Money Market Trust (the
"Fund") is a money market fund that seeks to provide security of
principal, high current income and liquidity.
[ICON] PRINCIPAL INVESTMENT STRATEGIES
- --------------------------------------------------------------------------------
The Fund will invest in high quality, short-term U.S. Government
securities. The Fund's "Investment Manager," Morgan Stanley Dean
Witter Advisors Inc., seeks to maintain the Fund's share price at
$1.00. The share price remaining stable at $1.00 means that the
Fund would preserve the principal value of your investment.
The U.S. Government securities that the Fund may purchase include:
- U.S. Treasury bills, notes and bonds, all of which
are direct obligations of the U.S. Government.
- Securities issued by agencies and
instrumentalities of the U.S. Government which are
backed by the full faith and credit of the United
States. Among the agencies and instrumentalities
issuing these obligations are the Government
National Mortgage Association and the Federal
Housing Administration.
- Securities issued by agencies and
instrumentalities which are not backed by the full
faith and credit of the United States, but whose
issuing agency or instrumentality has the right to
borrow, to meet its obligations, from the U.S.
Treasury. Among these agencies and
instrumentalities are the Federal National
Mortgage Association, the Federal Home Loan
Mortgage Corporation and the Federal Home Loan
Banks.
- Securities issued by agencies and
instrumentalities which are backed solely by the
credit of the issuing agency or instrumentality.
Among these agencies and instrumentalities is the
Federal Farm Credit System.
The Fund also may invest up to 10% of its assets in FDIC insured
certificates of deposit of banks and saving and loan institutions.
The Fund's policies discussed above are fundamental. These policies
may not be changed without shareholder approval. In addition to the
fundamental investment policies, the Fund may invest in repurchase
agreements. Repurchase agreements are contracts in which a
financial institution sells a security and agrees to buy it back on
a specific date (usually within 7 days) and at a higher price,
which reflects an agreed-upon interest rate.
1
<PAGE>
[ICON] PRINCIPAL RISKS
- --------------------------------------------------------------------------------
There is no assurance that the Fund will achieve its investment
objectives.
CREDIT AND INTEREST RATE RISKS. A principal risk of investing in the
Fund is associated with its U.S. Government securities investments,
which are subject to two types of risks: credit risk and interest
rate risk. Credit risk refers to the possibility that the issuer of
a security will be unable to make interest payments and repay the
principal on its debt. Interest rate risk, another risk of debt
securities, refers to fluctuations in the value of a fixed-income
security resulting from changes in the general level of interest
rates.
Credit risk is minimal with respect to the Fund's U.S. Government
securities investments. Repurchase agreements involve a greater
degree of credit risk. The Investment Manager, however, actively
manages the Fund's assets to reduce the risk of losing any
principal investment as a result of credit or interest rate risks.
In addition, federal regulations require money market funds, such
as the Fund, to invest only in debt obligations of high quality and
short maturities.
Shares of the Fund are not bank deposits and are not insured or
guaranteed by the FDIC or any other government agency. Although the
Fund seeks to preserve the value of your investment at $1.00 per
share, if it is unable to do so, it is possible to lose money by
investing in the Fund.
2
<PAGE>
[Sidebar]
ANNUAL TOTAL RETURNS
THIS CHART SHOWS HOW THE PERFORMANCE OF THE FUND'S SHARES HAS VARIED FROM YEAR
TO YEAR OVER THE PAST 10 CALENDAR YEARS.
AVERAGE ANNUAL
TOTAL RETURNS
THIS TABLE SHOWS THE FUND'S AVERAGE ANNUAL RETURNS.
ANNUAL FUND
OPERATING EXPENSES
THESE EXPENSES ARE DEDUCTED FROM THE FUND'S ASSETS AND ARE BASED ON EXPENSES
PAID FOR THE FISCAL YEAR ENDED JANUARY 31, 2000.
[End Sidebar]
[ICON] PAST PERFORMANCE
- --------------------------------------------------------------------------------
The bar chart and table below provide some indication of the risks of
investing in the Fund. For the Fund's most recent 7-day annualized
yield, you may call (800) 869-NEWS. The Fund's past performance does
not indicate how the Fund will perform in the future.
ANNUAL TOTAL RETURNS - CALENDAR YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
1990 7.35%
`91 5.37%
`92 3.03%
`93 2.29%
`94 3.22%
`95 5.02%
`96 4.47%
`97 4.63%
`98 4.71%
`99 4.38%
</TABLE>
During the periods shown in the bar chart, the highest return for a
calendar quarter was 1.83% (quarter ended March 31, 1990) and the
lowest return for a calendar quarter was 0.55% (quarter ended
June 30, 1993).
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS (AS OF DECEMBER 31, 1999)
- -----------------------------------------------------------------------------
PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
<S> <C> <C> <C>
- -----------------------------------------------------------------------------
U.S. Government Money Market 4.38% 4.64% 4.44%
- -----------------------------------------------------------------------------
</TABLE>
[ICON] FEES AND EXPENSES
- --------------------------------------------------------------------------------
The Fund is a no-load fund. The Fund does not impose any sales
charges and does not impose account or exchange fees. The table below
briefly describes the fees and expenses that you may pay if you buy
and hold shares of the Fund.
<TABLE>
<S> <C>
ANNUAL FUND OPERATING EXPENSES
- ----------------------------------------------------------------------
Management Fee 0.45%
- ----------------------------------------------------------------------
Distribution and service (12b-1) fees 0.08%
- ----------------------------------------------------------------------
Other expenses 0.31%
- ----------------------------------------------------------------------
Total annual Fund operating expenses 0.84%
- ----------------------------------------------------------------------
</TABLE>
3
<PAGE>
[Sidebar]
MORGAN STANLEY DEAN WITTER ADVISORS INC.
THE INVESTMENT MANAGER IS WIDELY RECOGNIZED AS A LEADER IN THE MUTUAL FUND
INDUSTRY AND TOGETHER WITH MORGAN STANLEY DEAN WITTER SERVICES COMPANY INC., ITS
WHOLLY-OWNED SUBSIDIARY, HAD APPROXIMATELY $155 BILLION IN ASSETS UNDER
MANAGEMENT AS OF FEBRUARY 29, 2000.
[End Sidebar]
EXAMPLE
This example is intended to help you compare the cost of investing in
the Fund with the cost of investing in other mutual funds.
The example assumes that you invest $10,000 in the Fund, your
investment has a 5% return each year, and the Fund's operating
expenses remain the same. Although your actual costs may be higher or
lower, the table below shows your costs at the end of each period
based on these assumptions.
<TABLE>
<CAPTION>
---------------------------------------------------
1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C>
---------------------------------------------------
$86 $268 $466 $1,037
---------------------------------------------------
</TABLE>
[ICON] FUND MANAGEMENT
- --------------------------------------------------------------------------------
The Fund has retained the Investment Manager -- Morgan Stanley Dean
Witter Advisors Inc. -- to provide administrative services, manage
its business affairs and invest its assets, including the placing
of orders for the purchase and sale of portfolio securities. The
Investment Manager is a wholly-owned subsidiary of Morgan Stanley
Dean Witter & Co., a preeminent global financial services firm that
maintains leading market positions in each of its three primary
businesses: securities, asset management and credit services. Its
main business office is located at Two World Trade Center, New
York, NY 10048.
The Fund pays the Investment Manager a monthly management fee as
full compensation for the services and facilities furnished to the
Fund, and for Fund expenses assumed by the Investment Manager. The
fee is based on the Fund's average daily net assets. For the fiscal
year ended January 31, 2000 the Fund accrued total compensation to
the Investment Manager amounting to 0.45% of the Fund's average
daily net assets.
4
<PAGE>
[Sidebar]
CONTACTING A
FINANCIAL ADVISOR
IF YOU ARE NEW TO THE ]MORGAN STANLEY DEAN WITTER FAMILY OF FUNDS AND WOULD LIKE
TO CONTACT A FINANCIAL ADVISOR, CALL (877) 937-MSDW (TOLL-FREE) FOR THE
TELEPHONE NUMBER OF THE MORGAN STANLEY DEAN WITTER OFFICE NEAREST YOU.
YOU MAY ALSO ACCESS OUR OFFICE LOCATOR ON OUR INTERNET SITE AT:
WWW.MSDW.COM/INDIVIDUAL/FUNDS
[End Sidebar]
SHAREHOLDER INFORMATION
[ICON] PRICING FUND SHARES
- --------------------------------------------------------------------------------
The price of Fund shares, called "net asset value," is based on the
amortized cost of the Fund's portfolio securities. The amortized cost
valuation method involves valuing a debt obligation in reference to
its cost, rather than market forces.
The net asset value per share of the Fund is determined once daily at
4:00 p.m. Eastern time on each day that the New York Stock Exchange
is open (or, on days when the New York Stock Exchange closes prior to
4:00 p.m., at such earlier time). Shares will not be priced on days
that the New York Stock Exchange is closed.
[ICON] HOW TO BUY SHARES
- --------------------------------------------------------------------------------
You may open a new account to buy Fund shares or buy additional
Fund shares for an existing account in several ways. When you buy
Fund shares, the shares are purchased at the next share price
calculated after we receive your purchase order accompanied by
federal or other immediately available funds. You begin earning
dividends the business day after the shares are purchased. We
reserve the right to reject any order for the purchase of Fund
shares.
<TABLE>
<CAPTION>
MINIMUM INVESTMENT AMOUNTS
--------------------------------------------------------------------------------------------
MINIMUM INVESTMENT
-------------------------
INVESTMENT OPTIONS INITIAL ADDITIONAL
<S> <C> <C> <C>
--------------------------------------------------------------------------------------------
Regular Accounts:
$ 1,000 $ 50
--------------------------------------------------------------------------------------------
Individual Retirement
Accounts: Regular IRAs
$ 1,000 $ 50
Education IRAs
$ 500 $ 50
--------------------------------------------------------------------------------------------
EASYINVEST-SM-
(Automatically from your
checking or savings account
or Money Market Fund)
not available $100
--------------------------------------------------------------------------------------------
</TABLE>
There is no minimum investment amount if you purchase Fund shares
through: (1) the Investment Manager's mutual fund asset allocation
plan, (2) a program, approved by the Fund's distributor, in which
you pay an asset-based fee for advisory, administrative and/or
brokerage services, or (3) employer-sponsored employee benefit plan
accounts. In addition, the Fund will waive the minimum initial
investment for the automatic reinvestment of distributions from
certain unit investment trusts.
5
<PAGE>
<TABLE>
<CAPTION>
INVESTMENT
OPTIONS PROCEDURES
<S> <C>
--------------------------------------------------------------------------------
Contact Your NEW ACCOUNTS AND SUBSEQUENT INVESTMENTS
Financial Advisor You may buy Fund shares by contacting your Morgan Stanley
Dean Witter Financial Advisor or other authorized financial
ICON representative. Your Financial Advisor will assist you,
step-by-step, with the procedures to invest in the Fund.
--------------------------------------------------------------------------------
By Mail NEW ACCOUNTS
ICON To open a new account to buy Fund shares:
- Complete and sign the attached Application.
- Make out a check for the investment amount to: Morgan
Stanley Dean Witter U.S. Government Money Market Trust.
- Mail the Application and check to Morgan Stanley Dean
Witter Trust FSB at P.O. Box 1040, Jersey City, NJ 07303.
------------------------------------------------------------
SUBSEQUENT INVESTMENTS
To buy additional shares for an existing Fund account:
- Write a "letter of instruction" to the Fund specifying the
name(s) on the account, the account number and the social
security or tax identification number, and the additional
investment amount. The letter must be signed by the
account owner(s).
- Make out a check for the investment amount to: Morgan
Stanley Dean Witter U.S. Government Money Market Trust.
- Mail the letter and check to Morgan Stanley Dean Witter
Trust FSB at the same address as for new accounts.
--------------------------------------------------------------------------------
By wire NEW ACCOUNTS
ICON To open a new account to buy Fund shares:
- Mail the attached Application, completed and signed, to
Morgan Stanley Dean Witter Trust FSB at P.O. Box 1040,
Jersey City, NJ 07303.
- Before sending instructions by wire, call us at
(800) 869-NEWS advising us of your purchase and to confirm
we have received your Application (at that time we will
provide you with a new account number).
- Wire the instructions specifying the name of the Fund and
your account number, along with the additional investment
amount, to The Bank of New York, for credit to the account
of "Morgan Stanley Dean Witter Trust FSB, Harborside
Financial Center, Plaza Two, Jersey City, NJ 07303,
Account No. 8900188413."
(When you buy Fund shares, wire purchase instructions
received by Morgan Stanley Dean Witter Trust FSB prior to
12:00 noon Eastern time are normally effective that day and
wire purchase instructions received after 12:00 noon are
normally effective the next business day.)
------------------------------------------------------------
SUBSEQUENT INVESTMENTS
To buy additional shares for an existing Fund account:
- Before sending instructions by wire, call us at
(800) 869-NEWS advising us of your purchase.
- Wire the instructions specifying the name of the Fund and
your account number, along with the investment amount, to
The Bank of New York, for credit to the account of Morgan
Stanley Dean Witter Trust FSB in the same manner as
opening an account.
(Also, when you buy additional Fund shares, wire purchase
instructions received by Morgan Stanley Dean Witter Trust
FSB prior to 12:00 noon Eastern time are normally effective
that day and wire purchase instructions received after
12:00 noon are normally effective the next business day.)
--------------------------------------------------------------------------------
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
INVESTMENT
OPTIONS PROCEDURES
<S> <C>
--------------------------------------------------------------------------------
EASYINVEST -SM- NEW ACCOUNTS
(Automatically This program is not available to open a new Fund account or
from your a new account of another Money Market Fund.
checking or ------------------------------------------------------------
savings SUBSEQUENT INVESTMENTS
account) EASYINVEST-SM- is a purchase plan that allows you to
transfer money automatically from your checking or savings
account to an existing Fund account on a
ICON
semi-monthly, monthly or quarterly basis. Contact your
Morgan Stanley Dean Witter Financial Advisor for further
information about this service.
--------------------------------------------------------------------------------
</TABLE>
ADDITIONAL PURCHASE INFORMATION. If you are a customer of Dean
Witter Reynolds or another authorized dealer of Fund shares, you
may upon request: (a) have the proceeds from the sale of listed
securities invested in Fund shares the day after you receive the
proceeds; and (b) pay for the purchase of certain listed securities
by automatic sale of Fund shares that you own. If you are a
customer of Dean Witter Reynolds or another authorized dealer of
the Fund's shares, you may have cash balances in your securities
account of $1,000 or more automatically invested in shares of the
Fund on the next business day after the balance is accrued in your
account. Cash balances of less than $1,000 may be automatically
invested in Fund shares on a weekly basis.
PLAN OF DISTRIBUTION. The Fund has adopted a Plan of Distribution in
accordance with Rule 12b-1 under the Investment Company Act of
1940. The Plan allows the Fund to pay distribution fees of up to
0.15% of its average daily net assets for the sale and distribution
of Fund shares. It also allows the Fund to pay for services to
shareholders. Because these fees are paid out of the Fund's assets
on an ongoing basis, over time these fees will increase the cost of
your investment and may cost you more than paying other types of
sales charges.
[ICON] HOW TO EXCHANGE SHARES
- --------------------------------------------------------------------------------
PERMISSIBLE FUND EXCHANGES. You may only exchange shares of the Fund
for shares of other continuously offered Morgan Stanley Dean Witter
Funds if the Fund shares were acquired in an exchange of shares
initially purchased in a Multi-Class Fund or an FSC Fund (subject
to a front-end sales charge). In that case, the shares may be
subsequently re-exchanged for shares of the same Class of any
Multi-Class Fund or FSC Fund or for shares of another Money Market
Fund, a No-Load Fund, North American Government Income Trust, or
Short-Term U.S. Treasury Trust. Of course, if an exchange is not
permitted, you may sell shares of the Fund and buy another fund's
shares with the proceeds.
See the inside back cover of this PROSPECTUS for each Morgan
Stanley Dean Witter Fund's designation as a Multi-Class Fund, FSC
Fund, No-Load Fund or Money Market Fund. If a Morgan Stanley Dean
Witter Fund is not listed, consult the inside back cover of that
fund's prospectus for its designation. For purposes of exchanges,
shares of FSC Funds are treated as Class A shares of a Multi-Class
Fund.
7
<PAGE>
The current prospectus for each fund describes its investment
objective(s), policies and investment minimums, and should be read
before investing.
EXCHANGE PROCEDURES. You can process an exchange by contacting your
Morgan Stanley Dean Witter Financial Advisor or other authorized
financial representative. Otherwise, you must forward an exchange
privilege authorization form to the Fund's transfer agent -- Morgan
Stanley Dean Witter Trust FSB -- and then write the transfer agent or
call (800) 869-NEWS to place an exchange order. You can obtain an
exchange privilege authorization form by contacting your Financial
Advisor or other authorized financial representative or by calling
(800) 869-NEWS.
An exchange to any Morgan Stanley Dean Witter Fund (except a Money
Market Fund) is made on the basis of the next calculated net asset
values of the Funds involved after the exchange instructions are
accepted. When exchanging into a Money Market Fund, the Fund's shares
are sold at their next calculated net asset value and the Money
Market Fund's shares are purchased at their net asset value on the
following business day.
The Fund may terminate or revise the exchange privilege upon
required notice. The check writing privilege is not available for
Money Market Fund shares you acquire in an exchange.
TELEPHONE EXCHANGES. For your protection when calling Morgan Stanley
Dean Witter Trust FSB, we will employ reasonable procedures to
confirm that exchange instructions communicated over the telephone
are genuine. These procedures may include requiring various forms
of personal identification such as name, mailing address, social
security or other tax identification number. Telephone instructions
also may be recorded.
Telephone instructions will be accepted if received by the Fund's
transfer agent between 9:00 a.m. and 4:00 p.m. Eastern time on any
day the New York Stock Exchange is open for business. During
periods of drastic economic or market changes, it is possible that
the telephone exchange procedures may be difficult to implement,
although this has not been the case with the Fund in the past.
MARGIN ACCOUNTS. If you have pledged your Fund shares in a margin
account, contact your Morgan Stanley Dean Witter Financial Advisor
or other authorized financial representative regarding restrictions
on the exchange of such shares.
EXCHANGING SHARES OF ANOTHER FUND SUBJECT TO A CONTINGENT DEFERRED
SALES CHARGE ("CDSC"). There are special considerations when you
exchange shares subject to a CDSC of another Morgan Stanley Dean
Witter Fund for shares of the Fund. When determining the length of
time you held the shares and the corresponding CDSC rate, any
period (starting at the end of the month) during which you held
shares of the Fund WILL NOT BE COUNTED. Thus, in effect the
"holding period" for purposes of calculating the CDSC is frozen
upon exchanging into the Fund. Nevertheless, if shares subject to a
CDSC are exchanged for shares of the Fund, you will receive a
credit when you sell the
8
<PAGE>
shares equal to the distribution (12b-1) fees, if any, you paid on
those shares while in the Fund up to the amount of any applicable
CDSC. See the prospectus of the fund that charges the CDSC for more
details.
LIMITATIONS ON EXCHANGES. Certain patterns of exchanges may result
in the Fund limiting or prohibiting, at its discretion, additional
purchases and/or exchanges. Determinations in this regard may be
based on the frequency or dollar amount of previous exchanges. The
Fund will notify you in advance of limiting your exchange
privileges.
For further information regarding exchange privileges, you should
contact your Morgan Stanley Dean Witter Financial Advisor or call
(800) 869-NEWS.
[ICON] HOW TO SELL SHARES
- --------------------------------------------------------------------------------
You can sell some or all of your Fund shares at any time. Your
shares will be sold at the next share price calculated after we
receive your order to sell as described below.
<TABLE>
<CAPTION>
OPTIONS PROCEDURES
<S> <C>
--------------------------------------------------------------------------------
Contact your To sell your shares, simply call your Morgan Stanley Dean
Financial Advisor Witter Financial Advisor or other authorized financial
ICON representative.
------------------------------------------------------------
Payment will be sent to the address to which the account is
registered or deposited in your brokerage account.
--------------------------------------------------------------------------------
Check-writing You may order a supply of blank checks by requesting them on
Option the investment application or by contacting your Morgan
ICON Stanley Dean Witter Financial Advisor.
------------------------------------------------------------
Checks may be written in any amount not less than $500. You
must sign checks exactly as their shares are registered. If
the account is a joint account, the check may contain one
signature unless the joint owners have specified on an
investment application that all owners are required to sign
checks.
------------------------------------------------------------
Payment of check proceeds normally will be made on the next
business day after we receive your check in proper form.
Shares purchased by check (including a certified or bank
cashier's check) are not normally available to cover
redemption checks until fifteen days after Morgan Stanley
Dean Witter Trust FSB receives the check used for
investment. A check will not be honored in an amount
exceeding the value of the account at the time the check is
presented for payment.
--------------------------------------------------------------------------------
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
OPTIONS PROCEDURES
<S> <C>
--------------------------------------------------------------------------------
Systematic If your investment in all of the Morgan Stanley Dean Witter
Withdrawal Plan Family of Funds has a total market value of at least
ICON $10,000, you may elect to withdraw amounts of $25 or more,
or in any whole percentage of a Fund's balance (provided the
amount is at least $25), on a monthly, quarterly,
semi-annual or annual basis, from any Fund with a balance of
at least $1,000. Each time you add a Fund to the plan, you
must meet the plan requirements.
------------------------------------------------------------
To sign up for the Systematic Withdrawal Plan, contact your
Morgan Stanley Dean Witter Financial Advisor or call
(800) 869-NEWS. You may terminate or suspend your plan at
any time. Please remember that withdrawals from the plan are
sales of shares, not Fund "distributions," and ultimately
may exhaust your account balance. The Fund may terminate or
revise the plan at any time.
------------------------------------------------------------
When you sell Fund shares through the Systematic Withdrawal
Plan, the shares may be subject to a contingent deferred
sales charge ("CDSC") if they were obtained in exchange for
shares subject to a CDSC of another Morgan Stanley Dean
Witter Fund. The CDSC, however, will be waived in an amount
up to 12% annually of the Fund's value, although Fund shares
with no CDSC will be sold first, followed by those with the
lowest CDSC. As such, the waiver benefit will be reduced by
the amount of your shares that are not subject to a CDSC.
See the prospectus of the Fund that charges the CDSC for
more details.
--------------------------------------------------------------------------------
By Letter You may also sell your shares by writing a "letter of
ICON instruction" that includes:
- your account number;
- the dollar amount or the number of shares you wish to
sell; and
- the signature of each owner as it appears on the account.
------------------------------------------------------------
If you are requesting payment to anyone other than the
registered owner(s) or that payment be sent to any address
other than the address of the registered owner(s) or
pre-designated bank account, you will need a signature
guarantee. You can obtain a signature guarantee from an
eligible guarantor acceptable to Morgan Stanley Dean Witter
Trust FSB. (You should contact Morgan Stanley Dean Witter
Trust FSB at (800)869-NEWS for a determination as to whether
a particular institution is an eligible guarantor.) A notary
public CANNOT provide a signature guarantee. Additional
documentation may be required for shares held by a
corporation, partnership, trustee or executor.
------------------------------------------------------------
Mail the letter to Morgan Stanley Dean Witter Trust FSB at
P.O. Box 983, Jersey City, NJ 07303.
------------------------------------------------------------
A check will be mailed to the name(s) and address in which
the account is registered, or otherwise according to your
instructions.
--------------------------------------------------------------------------------
By Telephone or To sell shares by telephone or wire, first complete a
Wire telephone redemption application designating a bank account.
ICON Redemptions for more than $1,000 will be wired to your bank
ICON account (your bank may charge a fee for this service). For
redemptions for less than $1,000, a check will be mailed to
your bank account. For more information or to request a
telephone redemption application, call Morgan Stanley Dean
Witter Trust FSB at (800) 869-NEWS.
--------------------------------------------------------------------------------
</TABLE>
PAYMENT FOR SOLD SHARES. After we receive your complete instructions
to sell as described above, a check will be mailed to you within
seven days, although we will attempt to make payment within one
business day. Payment may also be sent to your brokerage account.
10
<PAGE>
Payment may be postponed or the right to sell your shares
suspended, however, under unusual circumstances. If you request to
sell shares that were recently purchased by check, your sale will
not be effected until it has been verified that the check has been
honored.
INVOLUNTARY SALES. The Fund reserves the right, on sixty days'
notice, to sell the shares of any shareholder whose shares, due to
sales by the shareholder, have a value below $500. However, before
the Fund sells your shares in this manner, we will notify you and
allow you sixty days to make an additional investment in an amount
that will increase the value of your account to at least the
required amount before the sale is processed.
MONEY MARKET FUND AUTOMATIC SALE PROCEDURES. If you maintain a
brokerage account with Dean Witter Reynolds or another authorized
dealer of Fund shares, you may elect to have your Fund shares
automatically sold from your account to satisfy amounts you owe as
a result of purchasing securities or other transactions in your
brokerage account.
If you elect to participate by notifying Dean Witter Reynolds or
another authorized dealer of Fund shares, your brokerage account
will be scanned each business day prior to the close of business
(4:00 p.m. Eastern time). After any cash balances in the account
are applied, a sufficient number of Fund shares may be sold to
satisfy any amounts you are obligated to pay to Dean Witter
Reynolds or another authorized dealer of fund shares.
Sales will be effected on the business day before the date you are
obligated to make payment, and Dean Witter Reynolds or another
authorized dealer of Fund shares will receive the sale proceeds on
the following day.
EASYINVEST -SM- -- AUTOMATIC REDEMPTION. You may invest in shares of
certain other Morgan Stanley Dean Witter Funds by subscribing to
EASYINVEST -SM-, an automatic purchase plan that provides for the
automatic investment of any amount from $100 to $5,000 in shares of
the specified fund. Under EASYINVEST -SM-, you may direct that a
sufficient number of shares of the Fund be automatically sold and
the proceeds transferred to Morgan Stanley Dean Witter Trust FSB,
on a semi-monthly, monthly or quarterly basis, for investment in
shares of the specified fund. Sales of your Fund shares will be
made on the business day preceding the investment date and Morgan
Stanley Dean Witter Trust FSB will receive the proceeds for
investment on the day following the sale date.
MARGIN ACCOUNTS. If you have pledged your Fund shares in a margin
account, contact your Morgan Stanley Dean Witter Financial Advisor
or other authorized financial representative regarding restrictions
on the sale of such shares.
11
<PAGE>
[Sidebar]
TARGETED DIVIDENDS-SM-
YOU MAY SELECT TO HAVE YOUR FUND DISTRIBUTIONS AUTOMATICALLY INVESTED IN ANOTHER
MORGAN STANLEY DEAN WITTER FUND THAT YOU OWN. CONTACT YOUR MORGAN STANLEY DEAN
WITTER FINANCIAL ADVISOR FOR FURTHER INFORMATION ABOUT THIS SERVICE.
[End Sidebar]
[ICON] DISTRIBUTIONS
- --------------------------------------------------------------------------------
The Fund passes substantially all of its earnings along to its
investors as "distributions." The Fund earns interest from
fixed-income investments. These amounts are passed along to Fund
shareholders as "income dividend distributions." The Fund may realize
capital gains whenever it sells securities for a higher price than it
paid for them. These amounts may be passed along as "capital gain
distributions;" the Investment Manager does not anticipate that there
will be significant capital gain distributions.
The Fund declares income dividends payable on each
day the New York Stock Exchange is open for
business. Capital gains, if any, are distributed
periodically.
Distributions are reinvested automatically in
additional shares of the Fund (rounded to the last
1/100 of a share) and automatically credited to your
account unless you request in writing that
distributions be paid in cash. If you elect the cash
option, the Fund will reinvest the additional shares
and credit your account during the month, then
redeem the credited amount no later than the last
business day of the month, and mail a check to you
no later than seven business days after the end of
the month. No interest will accrue on uncashed
checks. If you wish to change how your distributions are paid, your
request should be received by the Fund's transfer agent, Morgan
Stanley Dean Witter Trust FSB, at least five business days prior to
the record date of the distributions.
[ICON] TAX CONSEQUENCES
- --------------------------------------------------------------------------------
As with any investment, you should consider how your Fund investment
will be taxed. The tax information in this PROSPECTUS is provided as
general information. You should consult your own tax professional
about the tax consequences of an investment in the Fund.
Unless your investment in the Fund is through a tax-deferred
retirement account, such as a 401(k) plan or IRA, you need to be
aware of the possible tax consequences when the Fund makes
distributions.
Your distributions are normally subject to federal and state income
tax when they are paid, whether you take them in cash or reinvest
them in Fund shares. A distribution also may be subject to local
income tax. Any income dividend distributions and any short-term
capital gain distributions are taxable to you as ordinary income. Any
long-term capital gain distributions are taxable as long-term capital
gains, no matter how long you have owned shares in the Fund.
Every January, you will be sent a statement (IRS Form 1099-DIV)
showing the taxable distributions paid to you in the previous year.
The statement provides information on your dividends and capital
gains for tax purposes.
12
<PAGE>
When you open your Fund account, you should provide your social
security or tax identification number on your investment application.
By providing this information, you will avoid being subject to a
federal backup withholding tax of 31% on taxable distributions and
sale proceeds. Any withheld amount would be sent to the IRS as an
advance tax payment.
13
<PAGE>
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand the Fund's
financial performance for the past 5 fiscal years of the Fund. Certain
information reflects financial results for a single Fund share throughout each
year. The total returns in the table represent the rate an investor would have
earned or lost on an investment in the Fund (assuming reinvestment of all
dividends and distributions).
This information has been audited by PricewaterhouseCoopers LLP, independent
accountants, whose report, along with the Fund's financial statements, is
included in this PROSPECTUS.
<TABLE>
<CAPTION>
FOR THE YEAR ENDED JANUARY 31, 2000 1999 1998 1997 1996
<S> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------
SELECTED PER SHARE DATA:
- ---------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ------- ------- ------- -------
Net investment income 0.044 0.045 0.046 0.043 0.049
Less dividends from net investment income (0.044) (0.045) (0.046) (0.043) (0.049)
- ---------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
- ---------------------------------------------------------------------------------------------------------
TOTAL RETURN 4.48% 4.63% 4.67% 4.41% 5.00%
- ---------------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS:
- ---------------------------------------------------------------------------------------------------------
Expenses 0.84% 0.94% 1.02% 1.11% 1.09%
- ---------------------------------------------------------------------------------------------------------
Net investment income 4.34% 4.50% 4.53% 4.29% 4.86%
- ---------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA:
- ---------------------------------------------------------------------------------------------------------
Net assets, end of period, in millions $1,081 $1,017 $891 $927 $903
- ---------------------------------------------------------------------------------------------------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
14
<PAGE>
MORGAN STANLEY DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST
PORTFOLIO OF INVESTMENTS JANUARY 31, 2000
<TABLE>
<CAPTION>
ANNUALIZED
PRINCIPAL DESCRIPTION YIELD
AMOUNT IN AND ON DATE OF
THOUSANDS MATURITY DATE PURCHASE VALUE
- ----------------------------------------------------------------------------------------------------------------
<C> <S> <C> <C>
U.S. GOVERNMENT AGENCIES (98.0%)
$135,212 Federal Farm Credit Bank
02/08/00-09/12/00........................................... 4.94-6.09% $ 132,996,357
495,737 Federal Home Loan Banks
02/01/00-07/05/00........................................... 4.95-5.95 491,120,293
242,731 Federal Home Loan Mortgage Corp.
02/03/00-09/01/00........................................... 5.54-6.02 240,988,910
196,696 Federal National Mortgage Assoc.
02/02/00-07/20/00........................................... 5.57-5.99 194,041,783
--------------
TOTAL U.S. GOVERNMENT AGENCIES
(AMORTIZED COST $1,059,147,343)...................................................... 1,059,147,343
--------------
U.S. GOVERNMENT OBLIGATION (0.8%)
9,000 U.S. Treasury Bill 03/02/00
(AMORTIZED COST $8,962,950)................................. 5.06 8,962,950
--------------
REPURCHASE AGREEMENTS (2.1%)
20,000 Banc of America Securities LLC due 02/01/00 (dated 01/31/00;
proceeds $20,003,217) (A) (IDENTIFIED COST $20,000,000)..... 5.79 20,000,000
2,115 The Bank of New York due 02/01/00
(dated 01/31/00; proceeds $2,115,439) (b)
(IDENTIFIED COST $2,115,101)................................ 5.75 2,115,101
--------------
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL REPURCHASE AGREEMENTS
(IDENTIFIED COST $22,115,101)........................................................... 22,115,101
---------------
TOTAL INVESTMENTS
(IDENTIFIED COST $1,090,225,394) (C).................................................... 100.9% 1,090,225,394
LIABILITIES IN EXCESS OF OTHER ASSETS................................................... (0.9) (9,645,622)
----- ---------------
NET ASSETS.............................................................................. 100.0% $ 1,080,579,772
----- ---------------
----- ---------------
</TABLE>
- ---------------------
(a) Collaterized by $17,175,016 FMAC 5.50% - 10.50% due 6/01/00 - 1/01/30
valued at $5,462,152 and by $19,434,255 FNMA 0.0% - 9.50% due 3/28/00 -
12/1/29 valued at $14,937,849.
(b) Collateralized by $1,981,382 U.S. Treasury Note 5.25% due 05/15/02 valued
at $1,897,505 and by $251,549 U.S. Treasury Note 7.50% due 05/15/02 valued
at $259,902.
(c) Cost is the same for federal income tax purposes.
SEE NOTES TO FINANCIAL STATEMENTS
15
<PAGE>
MORGAN STANLEY DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST
FINANCIAL STATEMENTS
STATEMENT OF ASSETS AND LIABILITIES
JANUARY 31, 2000
<TABLE>
<S> <C>
ASSETS:
Investments in securities, at value
(identified cost $1,090,225,394).......................................................... $1,090,225,394
Cash........................................................................................ 90,000
Receivable for:
Shares of beneficial interest sold...................................................... 457,217
Interest................................................................................ 3,555
Prepaid expenses and other assets........................................................... 139,559
--------------
TOTAL ASSETS........................................................................... 1,090,915,725
--------------
LIABILITIES:
Payable for:
Shares of beneficial interest repurchased............................................... 9,402,725
Investment management fee............................................................... 405,957
Plan of distribution fee................................................................ 91,721
Accrued expenses and other payables......................................................... 435,550
--------------
TOTAL LIABILITIES...................................................................... 10,335,953
--------------
NET ASSETS............................................................................. $1,080,579,772
==============
COMPOSITION OF NET ASSETS:
Paid-in-capital............................................................................. $1,080,577,772
Accumulated undistributed net investment income............................................. 2,000
--------------
NET ASSETS............................................................................. $1,080,579,772
==============
NET ASSET VALUE PER SHARE,
1,080,577,772 SHARES OUTSTANDING (UNLIMITED SHARES AUTHORIZED OF $.01 PAR VALUE).......... $1.00
==============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
16
<PAGE>
MORGAN STANLEY DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST
FINANCIAL STATEMENTS, CONTINUED
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED JANUARY 31, 2000
<TABLE>
<S> <C>
NET INVESTMENT INCOME:
INTEREST INCOME................................................................................ $54,473,807
-----------
EXPENSES
Investment management fee...................................................................... 4,688,933
Transfer agent fees and expenses............................................................... 2,812,787
Plan of distribution fee....................................................................... 795,443
Shareholder reports and notices................................................................ 225,030
Registration fees.............................................................................. 146,524
Professional fees.............................................................................. 71,922
Custodian fees................................................................................. 59,306
Trustees' fees and expenses.................................................................... 18,294
Other.......................................................................................... 11,284
-----------
TOTAL EXPENSES............................................................................ 8,829,523
-----------
NET INVESTMENT INCOME..................................................................... $45,644,284
===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
17
<PAGE>
MORGAN STANLEY DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST
FINANCIAL STATEMENTS, CONTINUED
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
JANUARY 31, 2000 JANUARY 31, 1999
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income................................................... $ 45,644,284 $ 41,848,979
Net realized gain....................................................... -- 40,360
-------------- --------------
NET INCREASE....................................................... 45,644,284 41,889,339
-------------- --------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income................................................... (45,643,923) (41,849,500)
Net realized gain....................................................... -- (40,360)
-------------- --------------
TOTAL DIVIDENDS AND DISTRIBUTIONS.................................. (45,643,923) (41,889,860)
-------------- --------------
Net increase from transactions in shares of beneficial interest......... 63,114,648 126,893,998
-------------- --------------
NET INCREASE....................................................... 63,115,009 126,893,477
NET ASSETS:
Beginning of period..................................................... 1,017,464,763 890,571,286
-------------- --------------
END OF PERIOD
(INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF $2,000 AND $1,639,
RESPECTIVELY)....................................................... $1,080,579,772 $1,017,464,763
============== ==============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
18
<PAGE>
MORGAN STANLEY DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST
NOTES TO FINANCIAL STATEMENTS JANUARY 31, 2000
1. ORGANIZATION AND ACCOUNTING POLICIES
Morgan Stanley Dean Witter U.S. Government Money Market Trust (the "Fund"), is
registered under the Investment Company Act of 1940, as amended (the "Act"), as
a diversified, open-end management investment company. The Fund's investment
objectives are security of principal, high current income and liquidity. The
Fund was organized as a Massachusetts business trust on November 18, 1981 and
commenced operations on February 17, 1982.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures. Actual results could differ from
those estimates.
The following is a summary of significant accounting policies:
A. VALUATION OF INVESTMENTS -- Portfolio securities are valued at amortized
cost, which approximates market value.
B. ACCOUNTING FOR INVESTMENTS -- Security transactions are accounted for on the
trade date (date the order to buy or sell is executed). Realized gains and
losses on security transactions are determined by the identified cost method.
Premiums are amortized and discounts are accreted over the life of the
respective securities.
C. FEDERAL INCOME TAX STATUS -- It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
D. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- The Fund records dividends and
distributions as of the close of each business day.
2. INVESTMENT MANAGEMENT AGREEMENT
Pursuant to an Investment Management Agreement with Morgan Stanley Dean Witter
Advisors Inc. (the "Investment Manager"), the Fund pays the Investment Manager a
management fee, accrued daily and payable monthly, by applying the following
annual rates to the net assets of the Fund determined as of the close of each
business day: 0.50% to the portion of the daily net assets not exceeding $500
million; 0.425% to the portion of the daily net assets exceeding $500 million
but not exceeding $750 million; 0.375% to the portion of the daily net assets
exceeding $750 million but not exceeding $1 billion; 0.35% to the portion of the
daily net assets exceeding $1 billion but not exceeding $1.5 billion; 0.325% to
the portion of the daily net assets exceeding $1.5 billion but not
19
<PAGE>
MORGAN STANLEY DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST
NOTES TO FINANCIAL STATEMENTS JANUARY 31, 2000, CONTINUED
exceeding $2 billion; 0.30% to the portion of the daily net assets exceeding $2
billion but not exceeding $2.5 billion; 0.275% to the portion of the daily net
assets exceeding $2.5 billion but not exceeding $3 billion; and 0.25% to the
portion of the daily net assets exceeding $3 billion.
Under the terms of the Agreement, the Investment Manager maintains certain of
the Fund's books and records and furnishes, at its own expense, office space,
facilities, equipment, clerical, bookkeeping and certain legal services and pays
the salaries of all personnel, including officers of the Fund who are employees
of the Investment Manager. The Investment Manager also bears the cost of
telephone services, heat, light, power and other utilities provided to the Fund.
3. PLAN OF DISTRIBUTION
Morgan Stanley Dean Witter Distributors Inc. (the "Distributor"), an affiliate
of the Investment Manager, is the distributor of the Fund's shares and, in
accordance with a Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under
the Act, finances certain expenses in connection therewith.
Under the Plan, the Distributor bears the expense of all promotional and
distribution related activities on behalf of the Fund, except for expenses that
the Trustees determine to reimburse, as described below. The following
activities and services may be provided by the Distributor, and other selected
broker-dealers under the Plan: (1) compensation to, and expenses of, Morgan
Stanley Dean Witter Financial Advisors and other selected broker-dealers; (2)
sales incentives and bonuses to sales representatives and to marketing personnel
in connection with promoting sales of the Fund's shares; (3) expenses incurred
in connection with promoting sales of the Fund's shares; (4) preparing and
distributing sales literature; and (5) providing advertising and promotional
activities, including direct mail solicitation and television, radio, newspaper,
magazine and other media advertisements.
The Fund is authorized to reimburse the Distributor for specific expenses the
Distributor incurs or plans to incur in promoting the distribution of the Fund's
shares. The amount of each monthly reimbursement payment may in no event exceed
an amount equal to a payment at the annual rate of 0.15% of the Fund's average
daily net assets during the month. Expenses incurred by the Distributor pursuant
to the Plan in any fiscal year will not be reimbursed by the Fund through
payments accrued in any subsequent fiscal year. For the year ended January 31,
2000, the distribution fee was accrued at the annual rate of 0.08%.
4. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES
The cost of purchases and proceeds from sales/maturities of portfolio securities
for the year ended January 31, 2000 aggregated $12,629,521,746 and
$12,616,296,283, respectively.
20
<PAGE>
MORGAN STANLEY DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST
NOTES TO FINANCIAL STATEMENTS JANUARY 31, 2000, CONTINUED
Morgan Stanley Dean Witter Trust FSB, an affiliate of the Investment Manager and
Distributor, is the Fund's transfer agent. At January 31, 2000, the Fund had
transfer agent fees and expenses payable of approximately $244,000.
The Fund has an unfunded noncontributory defined benefit pension plan covering
all independent Trustees of the Fund who will have served as independent
Trustees for at least five years at the time of retirement. Benefits under this
plan are based on years of service and compensation during the last five years
of service. Aggregate pension costs for the year ended January 31, 2000 included
in Trustees' fees and expenses in the Statement of Operations amounted to
$5,918. At January 31, 2000, the Fund had an accrued pension liability of
$51,850 which is included in accrued expenses in the Statement of Assets and
Liabilities.
5. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest, at $1.00 per share, were as
follows:
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
JANUARY 31, 2000 JANUARY 31, 1999
----------------- -----------------
<S> <C> <C>
Shares sold...................................................... 2,203,424,057 2,239,344,299
Shares issued in reinvestment of dividends....................... 45,490,746 41,717,140
Acquisition of Dean Witter Retirement Series -- U.S. Government
Money Market Series............................................. -- 837,211
---------------- ----------------
2,248,914,803 2,281,898,650
Shares repurchased............................................... (2,185,800,155) (2,155,004,652)
---------------- ----------------
Net increase..................................................... 63,114,648 126,893,998
================ ================
</TABLE>
6. ACQUISITION OF DEAN WITTER RETIREMENT SERIES -- U.S. GOVERNMENT MONEY MARKET
SERIES
As of the close of business on September 11, 1998, the Fund acquired all the net
assets of Dean Witter Retirement Series -- U.S. Government Money Market Series
("Retirement U.S. Government") pursuant to a plan of reorganization approved by
shareholders of Retirement U.S. Government on August 19, 1998. The acquisition
was accomplished by a tax-free exchange of 837,211 shares of the Fund at a net
asset value of $1.00 per share for 837,211 shares of Retirement U.S. Government.
The net assets of the Fund and Retirement U.S. Government immediately before the
acquisition were $942,511,862 and $837,211, respectively. Immediately after the
acquisition, the combined net assets of the Fund amounted to $943,349,073.
21
<PAGE>
MORGAN STANLEY DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE SHAREHOLDERS AND TRUSTEES
OF MORGAN STANLEY DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST
In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and the financial highlights (appearing in the "Financial
Highlights" table on page 14 of this Prospectus) present fairly, in all material
respects, the financial position of Morgan Stanley Dean Witter U.S. Government
Money Market Trust (the "Fund") at January 31, 2000, the results of its
operations for the year then ended, the changes in its 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, in conformity with accounting
principles generally accepted in the United States. These financial statements
and financial highlights (hereafter referred to as "financial statements") are
the responsibility of the Fund's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States, which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits, which included confirmation of securities at
January 31, 2000 by correspondence with the custodian, provide a reasonable
basis for the opinion expressed above.
PricewaterhouseCoopers LLP
1177 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10036
MARCH 7, 2000
22
<PAGE>
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23
<PAGE>
NOTES
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24
<PAGE>
MORGAN STANLEY DEAN WITTER
FAMILY OF FUNDS
The Morgan Stanley Dean Witter Family of Funds offers
investors a wide range of investment choices. Come on
in and meet the family!
- --------------------------------------------------------------------------------
GROWTH FUNDS
- ---------------------------------
Aggressive Equity Fund
American Opportunities Fund
Capital Growth Securities
Developing Growth Securities
Growth Fund
Market Leader Trust
Mid-Cap Equity Trust
Next Generation Trust
Small Cap Growth Fund
Special Value Fund
21st Century Trend Fund
THEME FUNDS
Financial Services Trust
Health Sciences Trust
Information Fund
Natural Resource Development Securities
GLOBAL/INTERNATIONAL FUNDS
Competitive Edge Fund - "Best Ideas"
Portfolio
European Growth Fund
Fund of Funds - International Portfolio
International Fund
International SmallCap Fund
Japan Fund
Latin American Growth Fund
Pacific Growth Fund
- --------------------------------------------------------------------------------
GROWTH AND INCOME FUNDS
- ---------------------------------
Balanced Growth Fund
Balanced Income Fund
Convertible Securities Trust
Dividend Growth Securities
Equity Fund
Fund of Funds - Domestic Portfolio
Income Builder Fund
Mid-Cap Dividend Growth Securities
S&P 500 Index Fund
S&P 500 Select Fund
Strategist Fund
Total Market Index Fund
Total Return Trust
Value Fund
Value-Added Market Series/Equity Portfolio
THEME FUNDS
Real Estate Fund
Utilities Fund
GLOBAL FUNDS
Global Dividend Growth Securities
Global Utilities Fund
- --------------------------------------------------------------------------------
INCOME FUNDS
- ---------------------------------
GOVERNMENT INCOME FUNDS
Federal Securities Trust
Short-Term U.S. Treasury Trust
U.S. Government Securities Trust
DIVERSIFIED INCOME FUNDS
Diversified Income Trust
CORPORATE INCOME FUNDS
High Yield Securities
Intermediate Income Securities
Short-Term Bond Fund (NL)
GLOBAL INCOME FUNDS
North American Government Income Trust
World Wide Income Trust
TAX-FREE INCOME FUNDS
California Tax-Free Income Fund
Hawaii Municipal Trust (FSC)
Limited Term Municipal Trust (NL)
Multi-State Municipal Series Trust (FSC)
New York Tax-Free Income Fund
Tax-Exempt Securities Trust
- --------------------------------------------------------------------------------
MONEY MARKET FUNDS
- ---------------------------------
TAXABLE MONEY MARKET FUNDS
Liquid Asset Fund (MM)
U.S. Government Money Market Trust (MM)
TAX-FREE MONEY MARKET FUNDS
California Tax-Free Daily Income Trust (MM)
New York Municipal Money Market Trust (MM)
Tax-Free Daily Income Trust (MM)
There may be Funds created after this PROSPECTUS was published. Please consult
the inside back cover of a new Fund's PROSPECTUS for its designation, e.g.,
Multi-Class Fund or Money Market Fund.
Unless otherwise noted, each listed Morgan Stanley Dean Witter Fund, except for
North American Government Income Trust and Short-Term U.S. Treasury Trust, is a
Multi-Class Fund. A Multi-Class Fund is a mutual fund offering multiple Classes
of shares. The other types of funds are: NL - No-Load (Mutual) Fund; MM - Money
Market Fund; FSC - A mutual fund sold with a front-end sales charge and a
distribution (12b-1) fee.
<PAGE>
2 3 0 --
for office use only
[LOGO]
APPLICATION
MORGAN STANLEY DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST
Send to: Morgan Stanley Dean Witter Trust FSB (the "Transfer Agent"), P.O. Box
1040, Jersey City, NJ 07303
[REMOVE APPLICATION CAREFULLY]
<TABLE>
<S> <C>
INSTRUCTIONS For assistance in completing this application, telephone Morgan Stanley Dean Witter Trust FSB at (800) 869-NEWS
(toll-free).
TO REGISTER
SHARES 1.
(please print)
---------------------------------------------------------------------------------------------------------------
First Name Last Name
- -As joint
tenants,
use line 2.
1 & 2 ---------------------------------------------------------------------------------------------------------------
First Name Last Name
(Joint tenants with rights of survivorship unless otherwise
specified)
------------------------
Social Security Number
- -As custodian
for a minor, 3.
use lines 1 &
3
---------------------------------------------------------------------------------------------------------------
Minor's Name
Under the________Uniform Gifts to Minors Act ---------------------------
Minor's Social Security Number
State of Residence of Minor
- -In the name of a
corporation, 4.
trust,
partnership
or other ---------------------------------------------------------------------------------------------------------------
institutional Name of Corporation, Trust (including trustee name(s)) or Other Organization
investors, use
line 4
If Trust, Date of Trust Instrument:____________ Tax Identification
Number__________
ADDRESS
---------------------------------------------------------------------------------------------------------------
City State Zip Code
TO PURCHASE
SHARES:
Minimum Initial / / CHECK (enclosed) $__________ (Make Payable to Morgan Stanley Dean Witter U.S. Government Money Market
Investment: Trust)
$1,000 / / WIRE* On__________ MF*________
(Date) (Control number, this transaction)
----------------------------------------------------------------------------------------------------------
Name of Bank Branch
----------------------------------------------------------------------------------------------------------
Address
----------------------------------------------------------------------------------------------------------
Telephone Number
* For an initial investment made by wiring funds, obtain a control number by calling: (800) 869-NEWS
(toll-free).
Your bank should wire to:
Bank of New York for credit to account of Morgan Stanley Dean Witter Trust FSB
Account Number: 8900188413
Re: Morgan Stanley Dean Witter U.S. Government Money Market Trust
Account Of:______________________
(Investor's Account as Registered at the Transfer Agent)
Control or Account Number:______________________
(Assigned by Telephone)
OPTIONAL SERVICES
NOTE: If you are a current shareholder of Morgan Stanley Dean Witter
U.S. Government Money Market Trust, please indicate your fund
account number here.
[ 2 ] [ 3 ] [ 0 ] -
------------------------------------------------
DIVIDENDS All dividends will be reinvested daily in additional shares, unless the following option is selected:
/ / Pay income dividends by check at the end of each month.
WRITE YOUR OWN / / Send an initial supply of checks.
CHECK FOR JOINT ACCOUNTS:
/ / CHECK THIS BOX IF ALL OWNERS ARE REQUIRED TO SIGN CHECKS.
</TABLE>
<PAGE>
<TABLE>
<S> <C>
/ / Morgan Stanley Dean Witter Trust FSB is hereby authorized to honor telephonic or other instructions, without
PAYMENT TO signature guarantee, from any person for the redemption of any or all shares of Morgan Stanley Dean Witter U.S.
PREDESIGNATED Government Money Market Trust held in my (our) account provided that proceeds are transmitted only to the
BANK ACCOUNT following bank account. (Absent its own negligence, neither Morgan Stanley Dean Witter U.S. Government Money
Market Trust nor Morgan Stanley Dean Witter Trust FSB (the "Transfer Agent") shall be liable for any
redemption caused by unauthorized instruction(s)):
Bank Account
must be in
same name as
shares are
registered ------------------------------------------------------------------------------- ------------------------------
NAME & BANK ACCOUNT NUMBER BANK'S ROUTING TRANSMIT CODE
(ASK YOUR BANK)
Minimum Amount: -------------------------------------------------------------------------------
$1,000 NAME OF BANK
-------------------------------------------------------------------------------
ADDRESS OF BANK
( )
-------------------------------------------------------------------------------
TELEPHONE NUMBER OF BANK
SIGNATURE AUTHORIZATION
FOR ALL ACCOUNTS NOTE: RETAIN A COPY OF THIS DOCUMENT FOR YOUR RECORDS. ANY MODIFICATION OF THE INFORMATION BELOW WILL REQUIRE AN
AMENDMENT TO THIS FORM. THIS DOCUMENT IS IN FULL FORCE AND EFFECT UNTIL ANOTHER DULY EXECUTED FORM IS RECEIVED BY
THE TRANSFER AGENT.
The "Transfer Agent" is hereby authorized to act as agent for the registered owner of shares of Morgan Stanley
Dean Witter U.S. Government Money Market Trust (the "Fund") in effecting redemptions of shares and is authorized
to recognize the signature(s) below in payment of funds resulting from such redemptions on behalf of the
registered owners of such shares. The Transfer Agent shall be liable only for its own negligence and not for
default or negligence of its correspondents, or for losses in transit. The Fund shall not be liable for any
default or negligence of the Transfer Agent.
I (we) certify to my (our) legal capacity, or the capacity of the investor named above, to invest in and redeem
shares of, and I (we) acknowledge receipt of a current prospectus of, Morgan Stanley Dean Witter U.S. Government
Money Market Trust and (we) further certify my (our) authority to sign and act for and on behalf of the investor.
Under penalties of perjury, I certify (1) that the number shown on this form is my correct taxpayer identification
number and (2) that I am not subject to backup withholding either because I have not been notified that I am
subject to backup withholding as a result of a failure to report all interest or dividends, or the Internal
Revenue Service has notified me that I am no longer subject to backup withholding. (Note: You must cross out item
(2) above if you have been notified by IRS that you are currently subject to backup withholding because of
underreporting interest or dividends on your tax return.)
For Individual, Joint and Custodial Accounts for Minors, Check Applicable Box:
/ / I am a United States Citizen. / / I am not a United States Citizen.
SIGNATURE(S) (IF JOINT TENANTS, ALL MUST SIGN)
</TABLE>
<TABLE>
<S> <C> <C>
------------------------------------------------ ------------------------------------------------
SIGNATURE MUST BE KEPT WITHIN ABOVE AREA SIGNATURE MUST BE KEPT WITHIN ABOVE AREA
-------------------------------------------------------- --------------------------------------------------------
SIGNATURE MUST BE KEPT WITHIN ABOVE AREA SIGNATURE MUST BE KEPT WITHIN ABOVE AREA
Name(s) must be
signed
exactly the same SIGNED THIS_______________DAY OF__________, 20____.
as shown on
lines 1 to 4 on
the reverse
side of this FOR CORPORATIONS, TRUSTS, PARTNERSHIPS AND OTHER ORGANIZATIONS
application
The following named persons are currently officers/trustees/general partners/other authorized signatories of the
Registered Owner, and any_____* of them ("Authorized Person(s)") is/are currently authorized under the applicable
governing document to act with full power to sell, assign or transfer securities of the the Fund for the
Registered Owner and to execute and deliver any instrument necessary to effectuate the authority hereby conferred:
NAME/TITLE SIGNATURE
</TABLE>
<TABLE>
<S> <C> <C>
In addition,
complete
Section A or B -------------------------------------------------------- --------------------------------------------------------
below.
-------------------------------------------------------- --------------------------------------------------------
SIGNATURE MUST BE KEPT WITHIN ABOVE AREA SIGNATURE MUST BE KEPT WITHIN ABOVE AREA
-------------------------------------------------------- --------------------------------------------------------
SIGNATURE MUST BE KEPT WITHIN ABOVE AREA SIGNATURE MUST BE KEPT WITHIN ABOVE AREA
-------------------------------------------------------- --------------------------------------------------------
SIGNATURE MUST BE KEPT WITHIN ABOVE AREA SIGNATURE MUST BE KEPT WITHIN ABOVE AREA
SIGNED THIS____________DAY OF____________, 20____.
The Transfer Agent may, without inquiry, act only upon the instruction of ANY PERSON(S) purporting to be (an)
Authorized Person(s) as named in the Certification Form last received by the Transfer Agent. The Transfer Agent
and the Fund shall not be liable for any claims, expenses (including legal fees) or losses resulting from the
Transfer Agent having acted upon any instruction reasonably believed genuine.
------------------------------------------------------------------------------------------------------------------
*INSERT A NUMBER. UNLESS OTHERWISE INDICATED, THE TRANSFER AGENT MAY HONOR INSTRUCTIONS OF ANY ONE OF THE PERSONS
NAMED ABOVE.
</TABLE>
<TABLE>
<S> <C>
SECTION (A) NOTE: EITHER A SIGNATURE GUARANTEE OR CORPORATE SEAL IS REQUIRED.
CORPORATIONS AND
INCORPORATED
ASSOCIATIONS ONLY. I, ____________, Secretary of the Registered Owner, do hereby certify that at a meeting on
SIGN ABOVE AND COM- ____________ at which a quorum was present throughout, the Board of Directors of the
PLETE THIS corporation/the officers of the association duly adopted a resolution, which is in full force and
SECTION effect and in accordance with the Registered Owner's charter and by-laws, which resolution did the
following: (1) empowered the above-named Authorized Person(s) to effect securities transactions
for the Registered Owner on the terms described above; (2) authorized the Secretary to certify,
from time to time, the names and titles of the officers of the Registered Owner and to notify the
Transfer Agent when changes in office occur; and (3) authorized the Secretary to certify that such
a resolution has been duly adopted and will remain in full force and effect until the Transfer
Agent receives a duly executed amendment to the Certification Form.
SIGNATURE
GUARANTEE** Witness my hand on behalf of the corporation/association this ______ day of ____________, 20____.
(or Corporate Seal)
--------------------------------------------------------------------------------------------------
Secretary**
The undersigned officer (other than the Secretary) hereby certifies that the foregoing instrument
has been signed by the Secretary of the
corporation/association.
SIGNATURE
GUARANTEE** --------------------------------------------------------------------------------------------------
(or Corporate Seal) Certifying Officer of the Corporation or Incorporated Association**
SECTION (B) ALL NOTE: A SIGNATURE GUARANTEE IS REQUIRED.
OTHER
INSTITUTIONAL --------------------------------------------------------------------------------------------------
INVESTORS Certifying
SIGNATURE Trustee(s)/General Partner(s)/Other(s)**
GUARANTEE**
--------------------------------------------------------------------------------------------------
SIGN ABOVE AND COM- Certifying
PLETE THIS SECTION Trustee(s)/General Partner(s)/Other(s)**
--------------------------------------------------------------------------------------------------
**SIGNATURE(S) MUST BE GUARANTEED BY AN ELIBIGLE GUARANTOR
</TABLE>
<TABLE>
<S> <C>
DEALER Above signature(s) guaranteed. Prospectus has been delivered by undersigned to above-named applicant(s).
(if any)
Completion by
dealer only ---------------------------------------------------- ----------------------------------------------------
Firm Name Office Number-Account Number at Dealer-A/E Number
---------------------------------------------------- ----------------------------------------------------
Address Account Executive's Last Name
---------------------------------------------------- ----------------------------------------------------
City, State, Zip Code Branch Office
</TABLE>
- -Registered Trademark- 2000 Morgan Stanley Dean Witter Distributors Inc.
<PAGE>
PROSPECTUS - MARCH 20, 2000
Additional information about the Fund's investments is available in the Fund's
ANNUAL AND SEMI-ANNUAL REPORTS TO SHAREHOLDERS (the current annual report is
included in this PROSPECTUS). The Fund's STATEMENT OF ADDITIONAL INFORMATION
also provides additional information about the Fund. The STATEMENT OF ADDITIONAL
INFORMATION is incorporated herein by reference (legally is part of this
PROSPECTUS). For a free copy of any of these documents, to request other
information about the Fund, or to make shareholder inquiries, please call:
(800) 869-NEWS
You also may obtain information about the Fund by calling your Morgan Stanley
Dean Witter Financial Advisor or by visiting our Internet site at:
www.msdw.com/individual/funds
Information about the Fund (including the STATEMENT OF ADDITIONAL INFORMATION)
can be viewed and copied at the Securities and Exchange Commission's Public
Reference Room in Washington, DC. Information about the Reference Room's
operations may be obtained by calling the SEC at (202) 942-8090. Reports and
other information about the Fund are available on the EDGAR Database on the
SEC's Internet site (www.sec.gov) and copies of this information may be
obtained, after paying a duplicating fee, by electronic request at the following
e-mail address: [email protected], or by writing the Public Reference Section
of the SEC, Washington, DC 20549-0102.
TICKER SYMBOL: DWGXX
(THE FUND'S INVESTMENT COMPANY ACT FILE NO. IS 811-3326)
Morgan Stanley Dean Witter
U.S. GOVERNMENT
MONEY MARKET TRUST
[BACK COVER PHOTO]
A MONEY MARKET FUND THAT
SEEKS TO PROVIDE SECURITY
OF PRINCIPAL, HIGH CURRENT
INCOME AND LIQUIDITY
<PAGE>
<TABLE>
<S> <C>
STATEMENT OF ADDITIONAL INFORMATION MORGAN STANLEY
MARCH 20, 2000 DEAN WITTER
U.S. GOVERNMENT
MONEY MARKET
TRUST
</TABLE>
- --------------------------------------------------------------------------------
This STATEMENT OF ADDITIONAL INFORMATION is not a PROSPECTUS. The PROSPECTUS
(dated March 20, 2000) for the Morgan Stanley Dean Witter U.S. Government Money
Market Trust may be obtained without charge from the Fund at its address or
telephone number listed below or from Dean Witter Reynolds at any of its branch
offices.
Morgan Stanley Dean Witter
U.S. Government Money Market Trust
Two World Trade Center
New York, New York 10048
(800) 869-NEWS
<PAGE>
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
I. Fund History............................................. 4
II. Description of the Fund and Its Investments and Risks... 4
A. Classification......................................... 4
B. Investment Strategies and Risks........................ 4
C. Fund Policies/Investment Restrictions.................. 6
III. Management of the Fund................................. 7
A. Board of Trustees...................................... 7
B. Management Information................................. 7
C. Compensation........................................... 12
IV. Control Persons and Principal Holders of Securities..... 14
V. Investment Management and Other Services................. 14
A. Investment Manager..................................... 14
B. Principal Underwriter.................................. 15
C. Services Provided by the Investment Manager............ 15
D. Rule 12b-1 Plan........................................ 16
E. Other Service Providers................................ 18
F. Codes of Ethics....................................... 18
VI. Brokerage Allocation and Other Practices................ 18
A. Brokerage Transactions................................. 18
B. Commissions............................................ 19
C. Brokerage Selection.................................... 19
D. Directed Brokerage..................................... 20
E. Regular Broker-Dealers................................. 20
VII. Capital Stock and Other Securities..................... 20
VIII. Purchase, Redemption and Pricing of Shares............ 21
A. Purchase/Redemption of Shares.......................... 21
B. Offering Price......................................... 21
IX. Taxation of the Fund and Shareholders................... 23
X. Underwriters............................................. 24
XI. Calculation of Performance Data......................... 24
XII. Financial Statements................................... 25
</TABLE>
2
<PAGE>
GLOSSARY OF SELECTED DEFINED TERMS
- --------------------------------------------------------------------------------
The terms defined in this glossary are frequently used in this STATEMENT OF
ADDITIONAL INFORMATION (other terms used occasionally are defined in the text of
the document).
"CUSTODIAN"--The Bank of New York.
"DEAN WITTER REYNOLDS"--Dean Witter Reynolds Inc., a wholly-owned broker-dealer
subsidiary of MSDW.
"DISTRIBUTOR"--Morgan Stanley Dean Witter Distributors Inc., a wholly-owned
broker-dealer subsidiary of MSDW.
"FINANCIAL ADVISORS"--Morgan Stanley Dean Witter authorized financial services
representatives.
"FUND"--Morgan Stanley Dean Witter U.S. Government Money Market Trust, a
registered open-end investment company.
"INVESTMENT MANAGER"--Morgan Stanley Dean Witter Advisors Inc., a wholly-owned
investment advisor subsidiary of MSDW.
"INDEPENDENT TRUSTEES"--Trustees who are not "interested persons" (as defined by
the Investment Company Act) of the Fund.
"MORGAN STANLEY & CO."--Morgan Stanley & Co. Incorporated, a wholly-owned
broker-dealer subsidiary of MSDW.
"MORGAN STANLEY DEAN WITTER FUNDS"--Registered investment companies (i) for
which the Investment Manager serves as the investment advisor and (ii) that hold
themselves out to investors as related companies for investment and investor
services.
"MSDW"--Morgan Stanley Dean Witter & Co., a preeminent global financial services
firm.
"MSDW SERVICES COMPANY"--Morgan Stanley Dean Witter Services Company Inc., a
wholly-owned fund services subsidiary of the Investment Manager.
"TRANSFER AGENT"--Morgan Stanley Dean Witter Trust FSB, a wholly-owned transfer
agent subsidiary of MSDW.
"TRUSTEES"--The Board of Trustees of the Fund.
3
<PAGE>
I. FUND HISTORY
- --------------------------------------------------------------------------------
The Fund was organized as a Massachusetts business trust, under a
Declaration of Trust, on November 18, 1981, with the name Sears U.S. Government
Money Market Trust. On March 21, 1983, the Fund's name was changed to Dean
Witter/Sears U.S. Government Money Market Trust. On February 19, 1993, the
Fund's name was changed to Dean Witter U.S. Government Money Market Trust.
Effective June 22, 1998, the Fund's name was changed to Morgan Stanley Dean
Witter U.S. Government Money Market Trust.
II. DESCRIPTION OF THE FUND AND ITS INVESTMENTS AND RISKS
- --------------------------------------------------------------------------------
A. CLASSIFICATION
The Fund is an open-end, diversified management investment company whose
investment objectives are security of principal, high current income and
liquidity.
B. INVESTMENT STRATEGIES AND RISKS
The following discussion of the Fund's investment strategies and risks
should be read with the sections of the Fund's PROSPECTUS titled "Principal
Investment Strategies" and "Principal Risks."
REPURCHASE AGREEMENTS. The Fund may invest in repurchase agreements. When
cash may be available for only a few days, it may be invested by the Fund in
repurchase agreements until such time as it may otherwise be invested or used
for payments of obligations of the Fund. These agreements, which may be viewed
as a type of secured lending by the Fund, typically involve the acquisition by
the Fund of debt securities from a selling financial institution such as a bank,
savings and loan association or broker-dealer. The agreement provides that the
Fund will sell back to the institution, and that the institution will
repurchase, the underlying security serving as collateral at a specified price
and at a fixed time in the future, usually not more than seven days from the
date of purchase. The Fund will accrue interest from the institution until the
time when the repurchase is to occur. Although this date is deemed by the Fund
to be the maturity date of a repurchase agreement, the maturities of securities
subject to repurchase agreements are not subject to any limits.
While repurchase agreements involve certain risks not associated with direct
investments in debt securities, the Fund follows procedures designed to minimize
such risks. These procedures include effecting repurchase transactions only with
large, well-capitalized and well-established financial institutions, whose
financial condition will be continuously monitored. In addition, the value of
the collateral underlying the repurchase agreement will always be at least equal
to the resale price which consists of the acquisition price paid to the seller
of the securities plus the accrued resale premium which is defined as the amount
specified in the repurchase agreement or the daily amortization of the
difference between the acquisition price and the resale price specified in the
repurchase agreement. Such collateral will consist entirely of securities that
are direct obligations of, or that are fully guaranteed as to principal and
interest by, the United States or any agency thereof, and/or certificates of
deposit, bankers' acceptances which are eligible for acceptance by a Federal
Reserve Bank, and, if the seller is a bank, mortgage related securities (as such
term is defined in section 3(a)(41) of the Securities Exchange Act of 1934 that,
at the time the repurchase agreement is entered into, are rated in the highest
rating category by the Requisite NRSROs (as defined under Rule 2a-7 of the
Investment Company Act of 1940). Additionally, Upon an Event of Insolvency (as
defined under Rule 2a-7) with respect to the seller, the collateral must qualify
the repurchase agreement for preferential treatment under a provision of
applicable insolvency law providing an exclusion from any automatic stay of
creditors' rights against the seller. In the event of a default or bankruptcy by
a selling financial institution, the Fund will seek to liquidate such
collateral. However, the exercising of the Fund's right to liquidate such
collateral could involve certain costs or delays and, to the extent that
proceeds from any sale upon a default of the obligation to repurchase were less
than the repurchase price, the Fund could suffer a loss. It is the current
policy of the Fund not to invest in repurchase agreements that do not mature
within seven days if any such investment, together with any other illiquid
assets held by the Fund, amount to more than 10% of its total assets. The Fund's
investments in repurchase agreements may at times be substantial when, in the
view of the Fund's investment manager, liquidity or other considerations
warrant.
4
<PAGE>
REVERSE REPURCHASE AGREEMENTS. The Fund may also use reverse repurchase
agreements as part of its investment strategy. Reverse repurchase agreements
involve sales by the Fund of portfolio assets concurrently with an agreement by
the Fund to repurchase the same assets at a later date at a fixed price.
Generally, the effect of such a transaction is that the Fund can recover all or
most of the cash invested in the portfolio securities involved during the term
of the reverse repurchase agreement, while it will be able to keep the interest
income associated with those portfolio securities. Such transactions are only
advantageous if the interest cost to the Fund of the reverse repurchase
transaction is less than the cost of obtaining the cash otherwise. Opportunities
to achieve this advantage may not always be available, and the Fund intends to
use the reverse repurchase technique only when it will be to its advantage to do
so. The Fund will establish a segregated account with its custodian bank in
which it will maintain cash or cash equivalents or other portfolio securities
equal in value to its obligations in respect of reverse repurchase agreements.
Reverse repurchase agreements are considered borrowings by the Fund and for
purposes other than meeting redemptions may not exceed 5% of the Fund's total
assets.
LENDING PORTFOLIO SECURITIES. The Fund may lend its portfolio securities to
brokers, dealers and other financial institutions, provided that the loans are
callable at any time by the Fund, and are at all times secured by cash or cash
equivalents, which are maintained in a segregated account pursuant to applicable
regulations and that are equal to at least 100% of the market value, determined
daily, of the loaned securities. The advantage of these loans is that the Fund
continues to receive the income on the loaned securities while at the same time
earning interest on the cash amounts deposited as collateral, which will be
invested in short-term obligations. The Fund will not lend its portfolio
securities if such loans are not permitted by the laws or regulations of any
state in which its shares are qualified for sale and will not lend more than 10%
of the value of its total assets.
As with any extensions of credit, there are risks of delay in recovery and,
in some cases, even loss of rights in the collateral should the borrower of the
securities fail financially. However, these loans of portfolio securities will
only be made to firms deemed by the Fund's management to be creditworthy and
when the income which can be earned from such loans justifies the attendant
risks. Upon termination of the loan, the borrower is required to return the
securities to the Fund. Any gain or loss in the market price during the loan
period would inure to the Fund.
When voting or consent rights which accompany loaned securities pass to the
borrower, the Fund will follow the policy of calling the loaned securities, to
be delivered within one day after notice, to permit the exercise of the rights
if the matters involved would have a material effect on the Fund's investment in
the loaned securities. The Fund will pay reasonable finder's, administrative and
custodial fees in connection with a loan of its securities.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES. From time to time the Fund may
purchase securities on a when-issued or delayed delivery basis. When these
transactions are negotiated, the price is fixed at the time of the commitment,
but delivery and payment can take place a month or more after the date of
commitment. While the Fund will only purchase securities on a when-issued,
delayed delivery with the intention of acquiring the securities, the Fund may
sell the securities before the settlement date, if it is deemed advisable. The
securities so purchased or sold are subject to market fluctuation and no
interest or dividends accrue to the purchaser prior to the settlement date.
At the time the Fund makes the commitment to purchase or sell securities on
a when-issued, delayed delivery, it will record the transaction and thereafter
reflect the value, each day, of such security purchased, or if a sale, the
proceeds to be received, in determining its net asset value. At the time of
delivery of the securities, their value may be more or less than the purchase or
sale price. An increase in the percentage of the Fund's assets committed to the
purchase of securities on a when-issued, delayed delivery may increase the
volatility of its net asset value. The Fund will also establish a segregated
account on the Fund's books in which it will continually maintain cash or cash
equivalents or other liquid portfolio securities equal in value to commitments
to purchase securities on a when-issued or delayed delivery basis.
YEAR 2000. The investment management services provided to the Fund by the
Investment Manager and the services provided to shareholders by the Distributor
and the Transfer Agent depend on the smooth functioning of their computer
systems. Many computer software systems in use today were
5
<PAGE>
designed in such a way that they may not be able to recognize the year 2000, but
revert to 1900 or some other date, due to the manner in which dates were encoded
and calculated. That failure could have a negative impact on the handling of
securities trades, pricing and account services.
Improperly functioning trading systems may result in settlement problems and
liquidity issues. Corporate and governmental data processing errors could result
in production problems for individual issuers and overall economic
uncertainties. Operations ran smoothly from the last week in December through
the first few weeks of January, but the year 2000 issue may yet have an adverse
impact on financial market participants and other entities, including the
issuers whose securities are contained in the Fund's portfolio.
C. FUND POLICIES/INVESTMENT RESTRICTIONS
The investment objectives, policies and restrictions listed below have been
adopted by the Fund as fundamental policies. Under the Investment Company Act of
1940 (the "Investment Company Act"), a fundamental policy may not be changed
without the vote of a majority of the outstanding voting securities of the Fund.
The Investment Company Act defines a majority as the lesser of (a) 67% or more
of the shares present at a meeting of shareholders, if the holders of 50% of the
outstanding shares of the Fund are present or represented by proxy; or (b) more
than 50% of the outstanding shares of the Fund. For purposes of the following
restrictions: (i) all percentage limitations apply immediately after a purchase
or initial investment; and (ii) any subsequent change in any applicable
percentage resulting from market fluctuations or other changes in total or net
assets does not require elimination of any security from the portfolio.
The Fund will:
1. Seek to provide security of principal, high current income and
liquidity.
The Fund may not:
1. Purchase common stocks, preferred stocks, warrants, other equity
securities, corporate bonds, municipal bonds or industrial revenue bonds.
2. Borrow money, except from banks for temporary or emergency
purposes, including the meeting of redemption requests which might otherwise
require the untimely disposition of securities; or through its transactions
in reverse repurchase agreements. Borrowing in the aggregate, including
reverse repurchase agreements, may not exceed 20%, and borrowing for
purposes other than meeting redemptions may not exceed 5% of the value of
the Fund's total assets (including the amount borrowed), less liabilities
(not including the amount borrowed) at the time the borrowing is made.
Borrowings in excess of 5% will be repaid before additional investments are
made.
3. Pledge, hypothecate, mortgage or otherwise encumber its assets,
except in an amount up to 10% of the value of its net assets, but only to
secure borrowings for temporary or emergency purposes.
4. Sell securities short or purchase securities on margin.
5. Write or purchase put or call options.
6. Underwrite the securities of other issuers or purchase restricted
securities except insofar as the Fund may enter into any repurchase or
reverse repurchase agreements.
6
<PAGE>
7. Purchase or sell real estate, real estate investment trust
securities, commodities or commodity contracts or oil and gas interests.
8. Make loans to others, except: (a) by the purchase of qualified debt
obligations; (b) lending portfolio securities; and (c) by investment in
repurchase agreements referred to above and in the Prospectus.
9. Issue senior securities as defined in the Act except insofar as the
Fund may be deemed to have issued a senior security by reason of: (a)
entering into any repurchase or reverse repurchase agreement; (b) borrowing
money in accordance with restrictions described above; or (c) lending
portfolio securities.
10. Purchase securities of other investment companies, except in
connection with a merger, consolidation, reorganization or acquisition of
assets.
11. Lend its portfolio securities in excess of 10% of its total assets.
Any loans of portfolio securities will be made according to guidelines
established by the Trustees, including maintenance of cash collateral of the
borrower equal at all times to the current market value of the securities
loaned.
Notwithstanding any other investment policy or restriction, the Fund may
seek to achieve its investment objective by investing all or substantially all
of its assets in another investment company having substantially the same
investment objective and policies as the Fund.
III. MANAGEMENT OF THE FUND
- --------------------------------------------------------------------------------
A. BOARD OF TRUSTEES
The Board of Trustees of the Fund oversees the management of the Fund but
does not itself manage the Fund. The Trustees review various services provided
by or under the direction of the Investment Manager to ensure that the Fund's
general investment policies and programs are properly carried out. The Trustees
also conduct their review to ensure that administrative services are provided to
the Fund in a satisfactory manner.
Under state law, the duties of the Trustees are generally characterized as a
duty of loyalty and a duty of care. The duty of loyalty requires a Trustee to
exercise his or her powers in the interest of the Fund and not the Trustee's own
interest or the interest of another person or organization. A Trustee satisfies
his or her duty of care by acting in good faith with the care of an ordinarily
prudent person and in a manner the Trustee reasonably believes to be in the best
interest of the Fund and its shareholders.
B. MANAGEMENT INFORMATION
TRUSTEES AND OFFICERS. The Board of the Fund consists of eight (8)
Trustees. These same individuals also serve as directors or trustees for all of
the Morgan Stanley Dean Witter Funds. Six Trustees (75% of the total number)
have no affiliation or business connection with the Investment Manager or any of
its affiliated persons and do not own any stock or other securities issued by
the Investment Manager's parent company, MSDW. These are the "non-interested" or
"independent" Trustees. The other two Trustees (the "management Trustees") are
affiliated with the Investment Manager.
7
<PAGE>
The Trustees and executive officers of the Fund, their principal business
occupations during the last five years and their affiliations, if any, with the
Investment Manager, and with the Morgan Stanley Dean Witter Funds (there were 93
such funds as of the calendar year ended December 31, 1999), are shown below.
<TABLE>
<CAPTION>
NAME, AGE, POSITION WITH FUND AND ADDRESS PRINCIPAL OCCUPATIONS DURING LAST FIVE YEARS
- --------------------------------------------- -----------------------------------------------
<S> <C>
Michael Bozic (59) .......................... Vice Chairman of Kmart Corporation (since
Trustee December 1998); Director or Trustee of the
c/o Kmart Corporation Morgan Stanley Dean Witter Funds; formerly
3100 West Big Beaver Road Chairman and Chief Executive Officer of Levitz
Troy, Michigan Furniture Corporation (November 1995-November
1998) and President and Chief Executive Officer
of Hills Department Stores (May 1991-July
1995); formerly variously Chairman, Chief
Executive Officer, President and Chief
Operating Officer (1987-1991) of the Sears
Merchandise Group of Sears, Roebuck and Co.;
Director of Weirton Steel Corporation.
Charles A. Fiumefreddo* (66) ................ Chairman, Director or Trustee and Chief
Chairman of the Board, Executive Officer of the Morgan Stanley Dean
Chief Executive Officer and Trustee Witter Funds; formerly Chairman, Chief
Two World Trade Center Executive Officer and Director of the
New York, New York Investment Manager, the Distributor and MSDW
Services Company; Executive Vice President and
Director of Dean Witter Reynolds; Chairman and
Director of the Transfer Agent; formerly
Director and/or officer of various MSDW
subsidiaries (until June 1998).
Edwin J. Garn (67) .......................... Director or Trustee of the Morgan Stanley Dean
Trustee Witter Funds; formerly United States
c/o Huntsman Corporation Senator (R-Utah) (1974-1992) and Chairman,
500 Huntsman Way Senate Banking Committee (1980-1986); formerly
Salt Lake City, Utah Mayor of Salt Lake City, Utah (1971-1974);
formerly Astronaut, Space Shuttle Discovery
(April 12-19, 1985); Vice Chairman, Huntsman
Corporation (chemical company); Director of
Franklin Covey (time management systems), BMW
Bank of North America, Inc. (industrial loan
corporation), United Space Alliance (joint
venture between Lockheed Martin and the Boeing
Company) and Nuskin Asia Pacific (multilevel
marketing); member of the board of various
civic and charitable organizations.
Wayne E. Hedien (66) ........................ Retired; Director or Trustee of the Morgan
Trustee Stanley Dean Witter Funds; Director of The PMI
c/o Mayer, Brown & Platt Group, Inc. (private mortgage insurance);
Counsel to the Independent Trustees Trustee and Vice Chairman of The Field Museum
1675 Broadway of Natural History; formerly associated with
New York, New York the Allstate Companies (1966-1994), most
recently as Chairman of The Allstate
Corporation (March 1993-December 1994) and
Chairman and Chief Executive Officer of its
wholly-owned subsidiary, Allstate Insurance
Company (July 1989-December 1994); director of
various other business and charitable
organizations.
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
NAME, AGE, POSITION WITH FUND AND ADDRESS PRINCIPAL OCCUPATIONS DURING LAST FIVE YEARS
- --------------------------------------------- -----------------------------------------------
<S> <C>
Dr. Manuel H. Johnson (51) .................. Senior Partner, Johnson Smick International,
Trustee Inc., a consulting firm; Co-Chairman and a
c/o Johnson Smick International, Inc. founder of the Group of Seven Council (G7C), an
1133 Connecticut Avenue, N.W. international economic commission; Chairman of
Washington, D.C. the Audit Committee and Director or Trustee of
the Morgan Stanley Dean Witter Funds; Director
of Greenwich Capital Markets, Inc.
(broker-dealer) and NVR, Inc. (home
construction); Chairman and Trustee of the
Financial Accounting Foundation (oversight
organization of the Financial Accounting
Standards Board); formerly Vice Chairman of the
Board of Governors of the Federal Reserve
System (1986-1990) and Assistant Secretary of
the U.S. Treasury.
Michael E. Nugent (63) ...................... General Partner, Triumph Capital, L.P., a
Trustee private investment partnership; Chairman of the
c/o Triumph Capital, L.P. Insurance Committee and Director or Trustee of
237 Park Avenue the Morgan Stanley Dean Witter Funds; formerly
New York, New York Vice President, Bankers Trust Company and BT
Capital Corporation (1984-1988); director of
various business organizations.
Philip J. Purcell* (56) ..................... Chairman of the Board of Directors and Chief
Trustee Executive Officer of MSDW, Dean Witter Reynolds
1585 Broadway and Novus Credit Services Inc.; Director of the
New York, New York Distributor; Director or Trustee of the Morgan
Stanley Dean Witter Funds; Director of American
Airlines, Inc. and its parent company, AMR
Corporation; Director and/ or officer of
various MSDW subsidiaries.
John L. Schroeder (69) ...................... Retired; Chairman of the Derivatives Committee
Trustee and Director or Trustee of the Morgan Stanley
c/o Mayer Brown & Platt Dean Witter Funds; Director of Citizens
Counsel to the Independent Trustees Utilities Company (telecommunications, gas,
1675 Broadway electric and water utilities company); formerly
New York, New York Executive Vice President and Chief Investment
Officer of the Home Insurance Company (August
1991-September 1995).
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
NAME, AGE, POSITION WITH FUND AND ADDRESS PRINCIPAL OCCUPATIONS DURING LAST FIVE YEARS
- --------------------------------------------- -----------------------------------------------
<S> <C>
Mitchell M. Merin (46) ...................... President and Chief Operating Officer of Asset
President Management of MSDW (since December 1998);
Two World Trade Center President and Director (since April 1997) and
New York, New York Chief Executive Officer (since June 1998) of
the Investment Manager and MSDW Services
Company; Chairman, Chief Executive Officer and
Director of the Distributor (since June 1998);
Chairman and Chief Executive Officer (since
June 1998) and Director (since January 1998) of
the Transfer Agent; Director of various MSDW
subsidiaries; President of the Morgan Stanley
Dean Witter Funds (since May 1999); Trustee of
various Van Kampen investment companies (since
December 1999); previously Chief Strategic
Officer of the Investment Manager and MSDW
Services Company and Executive Vice President
of the Distributor (April 1997-June 1998), Vice
President of the Morgan Stanley Dean Witter
Funds (May 1997-April 1999), and Executive Vice
President of Dean Witter, Discover & Co.
Barry Fink (45) ............................. Executive Vice President (since December 1999)
Vice President, Secretary and General Counsel and Secretary and General Counsel (since
Two World Trade Center February 1997) and Director (since July 1998)
New York, New York of the Investment Manager and MSDW Services
Company; Executive Vice President (since
December 1999) and Assistant Secretary and
Assistant General Counsel (since February 1997)
of the Distributor; Assistant Secretary of Dean
Witter Reynolds (since August 1996); Vice
President, Secretary and General Counsel of the
Morgan Stanley Dean Witter Funds (since
February 1997); previously First Vice President
(June 1993-February 1997), Vice President and
Assistant Secretary and Assistant General
Counsel of the Investment Manager and MSDW Ser-
vices Company, Senior Vice President of the
Distributor (March 1997-December 1999) and
Assistant Secretary of the Morgan Stanley Dean
Witter Funds.
Jonathan R. Page (53) ....................... Senior Vice President of the Investment Manager
Vice President and Director of the Money Market Group of the
Two World Trade Center Investment Manager; Vice President of various
New York, New York Morgan Stanley Dean Witter Funds.
Thomas F. Caloia (53) ....................... First Vice President and Assistant Treasurer of
Treasurer the Investment Manager and MSDW Services Com-
Two World Trade Center pany; Treasurer of the Morgan Stanley Dean
New York, New York Witter Funds.
</TABLE>
- ------------------------
*Denotes Trustees who are "interested persons" of the Fund as defined by the
Investment Company Act.
10
<PAGE>
In addition, RONALD E. ROBISON, Executive Vice President, Chief
Administrative Officer and Director of the Investment Manager and MSDW Services
Company, ROBERT S. GIAMBRONE, Senior Vice President of the Investment Manager,
MSDW Services Company, the Distributor and the Transfer Agent and Director of
the Transfer Agent, JOSEPH J. MCALINDEN, Executive Vice President and Chief
Investment Officer of the Investment Manager and Director of the Transfer Agent,
PETER M. AVELAR, Director of the High Yield Group and Senior Vice President of
the Investment Manager, PAUL D. VANCE, Director of the Growth and Income Group
and Senior Vice President of the Investment Manager, and JAMES F. WILLISON,
Director of the Tax-Exempt Fixed Income Group and Senior Vice President of the
Investment Manager, are Vice Presidents of the Fund.
In addition, MARILYN K. CRANNEY, TODD LEBO, LOU ANNE D. MCINNIS, CARSTEN
OTTO and RUTH ROSSI, First Vice Presidents and Assistant General Counsels of the
Investment Manager and MSDW Services Company, and NATASHA KASSIAN, Assistant
Vice President and Assistant General Counsel of the Investment Manager and MSDW
Services Company, are Assistant Secretaries of the Fund.
INDEPENDENT DIRECTORS/TRUSTEES AND THE COMMITTEES. Law and regulation
establish both general guidelines and specific duties for the independent
directors/trustees. The Morgan Stanley Dean Witter Funds seek as independent
directors/trustees individuals of distinction and experience in business and
finance, government service or academia; these are people whose advice and
counsel are in demand by others and for whom there is often competition. To
accept a position on the Funds' boards, such individuals may reject other
attractive assignments because the Funds make substantial demands on their time.
All of the Independent Trustees serve as members of the Audit Committee. In
addition, three of the directors/trustees, including two independent
directors/trustees, serve as members of the Derivatives Committee and the
Insurance Committee.
The independent directors/trustees are charged with recommending to the full
board approval of management, advisory and administration contracts, Rule 12b-1
plans and distribution and underwriting agreements; continually reviewing Fund
performance; checking on the pricing of portfolio securities, brokerage
commissions, transfer agent costs and performance, and trading among Funds in
the same complex; and approving fidelity bond and related insurance coverage and
allocations, as well as other matters that arise from time to time. The
independent directors/trustees are required to select and nominate individuals
to fill any independent director/trustee vacancy on the board of any Fund that
has a Rule 12b-1 plan of distribution. Most of the Morgan Stanley Dean Witter
Funds have a Rule 12b-1 plan.
The Audit Committee is charged with recommending to the full board the
engagement or discharge of the Fund's independent accountants; directing
investigations into matters within the scope of the independent accountants'
duties, including the power to retain outside specialists; reviewing with the
independent accountants the audit plan and results of the auditing engagement;
approving professional services provided by the independent accountants and
other accounting firms prior to the performance of the services; reviewing the
independence of the independent accountants; considering the range of audit and
non-audit fees; reviewing the adequacy of the Fund's system of internal
controls; and preparing and submitting Committee meeting minutes to the full
board.
The board of each Fund has a Derivatives Committee to approve parameters for
and monitor the activities of the Fund with respect to derivative investments,
if any, made by the Fund.
Finally, the board of each Fund has formed an Insurance Committee to review
and monitor the insurance coverage maintained by the Fund.
ADVANTAGES OF HAVING SAME INDIVIDUALS AS INDEPENDENT DIRECTORS/TRUSTEES FOR
ALL MORGAN STANLEY DEAN WITTER FUNDS. The independent directors/trustees and
the Funds' management believe that having the same independent
directors/trustees for each of the Morgan Stanley Dean Witter Funds avoids the
duplication of effort that would arise from having different groups of
individuals serving as independent directors/trustees for each of the Funds or
even of sub-groups of Funds. They believe that having the same individuals serve
as independent directors/trustees of all the Funds tends to increase their
knowledge and expertise regarding matters which affect the Fund complex
generally and enhances
11
<PAGE>
their ability to negotiate on behalf of each Fund with the Fund's service
providers. This arrangement also precludes the possibility of separate groups of
independent directors/trustees arriving at conflicting decisions regarding
operations and management of the Funds and avoids the cost and confusion that
would likely ensue. Finally, having the same independent directors/trustees
serve on all Fund boards enhances the ability of each Fund to obtain, at modest
cost to each separate Fund, the services of independent directors/trustees, of
the caliber, experience and business acumen of the individuals who serve as
independent directors/trustees of the Morgan Stanley Dean Witter Funds.
TRUSTEE AND OFFICER INDEMNIFICATION. The Fund's Declaration of Trust
provides that no Trustee, officer, employee or agent of the Fund is liable to
the Fund or to a shareholder, nor is any Trustee, officer, employee or agent
liable to any third persons in connection with the affairs of the Fund, except
as such liability may arise from his/her or its own bad faith, willful
misfeasance, gross negligence or reckless disregard of his/her or its duties. It
also provides that all third persons shall look solely to the Fund property for
satisfaction of claims arising in connection with the affairs of the Fund. With
the exceptions stated, the Declaration of Trust provides that a Trustee,
officer, employee or agent is entitled to be indemnified against all liability
in connection with the affairs of the Fund.
C. COMPENSATION
The Fund pays each Independent Trustee an annual fee of $800 plus a per
meeting fee of $50 for meetings of the Board of Trustees, the Independent
Trustees or Committees of the Board of Trustees attended by the Trustee (the
Fund pays the Chairman of the Audit Committee an additional annual fee of $750
and the Chairmen of the Derivatives and Insurance Committees additional annual
fees of $500). If a Board meeting and a meeting of the Independent Trustees or a
Committee meeting, or a meeting of the Independent Trustees and/or more than one
Committee meeting, take place on a single day, the Trustees are paid a single
meeting fee by the Fund. The Fund also reimburses such Trustees for travel and
other out-of-pocket expenses incurred by them in connection with attending such
meetings. Trustees and officers of the Fund who are or have been employed by the
Investment Manager or an affiliated company receive no compensation or expense
reimbursement from the Fund for their services as Trustee.
The following table illustrates the compensation that the Fund paid to its
Independent Trustees for the fiscal year ended January 31, 2000.
FUND COMPENSATION
<TABLE>
<CAPTION>
AGGREGATE
COMPENSATION
NAME OF INDEPENDENT TRUSTEE FROM THE FUND
- --------------------------- -------------
<S> <C>
Michael Bozic............................................... $1,550
Edwin J. Garn............................................... 1,600
Wayne E. Hedien............................................. 1,600
Dr. Manuel H. Johnson....................................... 2,288
Michael E. Nugent........................................... 2,058
John L. Schroeder........................................... 2,058
</TABLE>
12
<PAGE>
The following table illustrates the compensation paid to the Fund's
Independent Trustees for the calendar year ended December 31, 1999 for services
to the 93 Morgan Stanley Dean Witter Funds that were in operation at December
31, 1999.
CASH COMPENSATION FROM MORGAN STANLEY DEAN WITTER FUNDS
<TABLE>
<CAPTION>
TOTAL CASH
COMPENSATION
FOR SERVICES TO
93 MORGAN
STANLEY
DEAN WITTER
NAME OF INDEPENDENT TRUSTEE FUNDS
- --------------------------- ---------------
<S> <C>
Michael Bozic............................................... $134,600
Edwin J. Garn............................................... 138,700
Wayne E. Hedien............................................. 138,700
Dr. Manuel H. Johnson....................................... 208,638
Michael E. Nugent........................................... 193,324
John L. Schroeder........................................... 193,324
</TABLE>
As of the date of this STATEMENT OF ADDITIONAL INFORMATION, 55 of the Morgan
Stanley Dean Witter Funds, including the Fund, have adopted a retirement program
under which an independent director/ trustee who retires after serving for at
least five years (or such lesser period as may be determined by the Board) as an
independent director/trustee of any Morgan Stanley Dean Witter Fund that has
adopted the retirement program (each such Fund referred to as an "Adopting Fund"
and each such director/trustee referred to as an "Eligible Trustee") is entitled
to retirement payments upon reaching the eligible retirement age (normally,
after attaining age 72). Annual payments are based upon length of service.
Currently, upon retirement, each Eligible Trustee is entitled to receive
from the Adopting Fund, commencing as of his or her retirement date and
continuing for the remainder of his or her life, an annual retirement benefit
(the "Regular Benefit") equal to 30.22% of his or her Eligible Compensation plus
0.5036667% of such Eligible Compensation for each full month of service as an
independent director/ trustee of any Adopting Fund in excess of five years up to
a maximum of 60.44% after ten years of service. The foregoing percentages may be
changed by the Board.(1) "Eligible Compensation" is one-fifth of the total
compensation earned by such Eligible Trustee for service to the Adopting Fund in
the five year period prior to the date of the Eligible Trustee's retirement.
Benefits under the retirement program are accrued as expenses on the books of
the Adopting Funds. Such benefits are not secured or funded by the Adopting
Funds.
The following table illustrates the retirement benefits accrued to the
Fund's Independent Trustees by the Fund for the fiscal year ended January 31,
2000 and by the 55 Morgan Stanley Dean Witter Funds (including the Fund) for the
year ended December 31, 1999, and the estimated retirement benefits for the
Independent Trustees, to commence upon their retirement, from the Fund as of
January 31, 2000 and from the 55 Morgan Stanley Dean Witter Funds as of December
31, 1999.
- ------------------------
(1) An Eligible Trustee may elect alternative payments of his or her retirement
benefits based upon the combined life expectancy of the Eligible Trustee
and his or her spouse on the date of such Eligible Trustee's retirement. In
addition, the Eligible Trustee may elect that the surviving spouse's
periodic payment of benefits will be equal to a lower percentage of the
periodic amount when both spouses were alive. The amount estimated to be
payable under this method, through the remainder of the later of the lives
of the Eligible Trustee and spouse, will be the actuarial equivalent of the
Regular Benefit.
13
<PAGE>
RETIREMENT BENEFITS FROM THE FUND AND ALL MORGAN STANLEY DEAN WITTER FUNDS
<TABLE>
<CAPTION>
FOR ALL ADOPTING FUNDS
----------------------------- ESTIMATED ANNUAL
ESTIMATED RETIREMENT BENEFITS BENEFITS
CREDITED ACCRUED AS EXPENSES UPON RETIREMENT(2)
YEARS ESTIMATED --------------------- --------------------
OF SERVICE AT PERCENTAGE OF BY ALL FROM FROM ALL
RETIREMENT ELIGIBLE BY THE ADOPTING THE ADOPTING
NAME OF INDEPENDENT TRUSTEE (MAXIMUM 10) COMPENSATION FUND FUNDS FUND FUNDS
- --------------------------- ------------- ------------- -------- ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Michael Bozic............. 10 60.44% $377 $20,933 $ 907 $ 50,588
Edwin J. Garn............. 10 60.44 553 31,737 909 50,675
Wayne E. Hedien........... 9 51.37 709 39,566 771 43,000
Dr. Manuel H. Johnson..... 10 60.44 241 13,129 1,360 75,520
Michael E. Nugent......... 10 60.44 415 23,175 1,209 67,209
John L. Schroeder......... 8 50.37 805 41,558 955 52,994
</TABLE>
- ------------------------
(2) Based on current levels of compensation. Amount of annual benefits also
varies depending on the Trustee's elections described in Footnote (1) on
page 13.
IV. CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
- --------------------------------------------------------------------------------
The following owned 5% or more of the outstanding shares of the Fund on
March 3, 2000: Mellon Bank N.A., Mutual Funds, P.O. Box 3198, Pittsburgh PA
15230, as trustee of the Morgan Stanley Dean Witter START Plan, an employee
benefit plan established under Sections 401(a) and 401(k) of the Internal
Revenue Code for the benefit of certain employees of MSDW and its subsidiaries
- -- 13.15%.
As of the date of this STATEMENT OF ADDITIONAL INFORMATION, the aggregate
number of shares of beneficial interest of the Fund owned by the Fund's officers
and Trustees as a group was less than 1% of the Fund's shares of beneficial
interest outstanding.
V. INVESTMENT MANAGEMENT AND OTHER SERVICES
- --------------------------------------------------------------------------------
A. INVESTMENT MANAGER
The Investment Manager to the Fund is Morgan Stanley Dean Witter Advisors
Inc., a Delaware corporation, whose address is Two World Trade Center, New York,
NY 10048. The Investment Manager is a wholly-owned subsidiary of MSDW, a
Delaware corporation. MSDW is a preeminent global financial services firm that
maintains leading market positions in each of its three primary businesses:
securities, asset management and credit services.
Pursuant to an Investment Management Agreement (the "Management Agreement")
with the Investment Manager, the Fund has retained the Investment Manager to
provide administrative services and manage the investment of the Fund's assets,
including the placing of orders for the purchase and sale of portfolio
securities. The Fund pays the Investment Manager monthly compensation calculated
daily by applying the following annual rates to the net assets of the Fund,
determined as of the close of business on every business day: 0.50% of the
portion of the daily net assets not exceeding $500 million; 0.425% of the
portion of the daily net assets exceeding $500 million but not exceeding $750
million; 0.375% of the portion of the daily net assets exceeding $750 million
but not exceeding $1 billion; 0.35% of the portion of the daily net assets
exceeding $1 billion but not exceeding $1.5 billion; 0.325% of the portion of
the daily net assets exceeding $1.5 billion but not exceeding $2 billion; 0.30%
of the portion of the daily net assets exceeding $2 billion but not exceeding
$2.5 billion; 0.275% of the portion of the daily net assets exceeding $2.5
billion but not exceeding $3 billion; and 0.25% of the portion of the daily net
assets exceeding $3 billion.
For the fiscal years ended January 31, 1998, 1999 and 2000, the Investment
Manager accrued total compensation under the Management Agreement in the amounts
of $4,108,339, $4,236,205 and $4,688,933, respectively.
14
<PAGE>
The Investment Manager has retained its wholly-owned subsidiary, MSDW
Services Company, to perform administrative services for the Fund.
B. PRINCIPAL UNDERWRITER
The Fund's principal underwriter is the Distributor (which has the same
address as the Investment Manager). In this capacity, the Fund's shares are
distributed by the Distributor. The Distributor has entered into a selected
dealer agreement with Dean Witter Reynolds, which through its own sales
organization sells shares of the Fund. In addition, the Distributor may enter
into similar agreements with other selected broker-dealers. The Distributor, a
Delaware corporation, is a wholly-owned subsidiary of MSDW.
The Fund and the Distributor have agreed to indemnify each other against
certain liabilities, including liabilities under the Securities Act. Under the
Distribution Agreement, the Distributor uses its best efforts in rendering
services to the Fund, but in the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of its obligations, the Distributor is
not liable to the Fund or any of its shareholders for any error of judgment or
mistake of law or for any act or omission or for any losses sustained by the
Fund or its shareholders.
C. SERVICES PROVIDED BY THE INVESTMENT MANAGER
The Investment Manager manages the investment of the Fund's assets,
including the placing of orders for the purchase and sale of portfolio
securities. The Investment Manager obtains and evaluates the information and
advice relating to the economy, securities markets, and specific securities as
it considers necessary or useful to continuously manage the assets of the Fund
in a manner consistent with its investment objective.
Under the terms of the Management Agreement, in addition to managing the
Fund's investments, the Investment Manager maintains certain of the Fund's books
and records and furnishes, at its own expense, the office space, facilities,
equipment, clerical help, bookkeeping and certain legal services as the Fund may
reasonably require in the conduct of its business, including the preparation of
prospectuses, proxy statements and reports required to be filed with federal and
state securities commissions (except insofar as the participation or assistance
of independent accountants and attorneys is, in the opinion of the Investment
Manager, necessary or desirable). In addition, the Investment Manager pays the
salaries of all personnel, including officers of the Fund, who are employees of
the Investment Manager. The Investment Manager also bears the cost of telephone
service, heat, light, power and other utilities provided to the Fund.
Expenses not expressly assumed by the Investment Manager under the
Management Agreement or by the Distributor, will be paid by the Fund. These
expenses include, but are not limited to: expenses of the Plan of Distribution
pursuant to Rule 12b-1; charges and expenses of any registrar, custodian, stock
transfer and dividend disbursing agent; brokerage commissions; taxes; engraving
and printing share certificates; registration costs of the Fund and its shares
under federal and state securities laws; the cost and expense of printing,
including typesetting, and distributing prospectuses of the Fund and supplements
thereto to the Fund's shareholders; all expenses of shareholders' and Trustees'
meetings and of preparing, printing and mailing of proxy statements and reports
to shareholders; fees and travel expenses of Trustees or members of any advisory
board or committee who are not employees of the Investment Manager or any
corporate affiliate of the Investment Manager; all expenses incident to any
dividend, withdrawal or redemption options; charges and expenses of any outside
service used for pricing of the Fund's shares; fees and expenses of legal
counsel, including counsel to the Trustees who are not interested persons of the
Fund or of the Investment Manager (not including compensation or expenses of
attorneys who are employees of the Investment Manager); fees and expenses of the
Fund's independent accountants; membership dues of industry associations;
interest on Fund borrowings; postage; insurance premiums on property or
personnel (including officers and Trustees) of the Fund which inure to its
benefit; extraordinary expenses (including, but not limited to, legal claims and
liabilities and litigation costs and any indemnification relating thereto); and
all other costs of the Fund's operation.
15
<PAGE>
The Management Agreement provides that in the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations thereunder, the Investment Manager is not liable to the Fund or any
of its investors for any act or omission by the Investment Manager or for any
losses sustained by the Fund or its investors.
The Management Agreement will remain in effect from year to year, provided
continuance of the Management Agreement is approved at least annually by the
vote of the holders of a majority, as defined in the Investment Company Act, of
the outstanding shares of the Fund, or by the Trustees; provided that in either
event such continuance is approved annually by the vote of a majority of the
Trustees, including a majority of the Independent Trustees.
D. RULE 12b-1 PLAN
In accordance with a Plan of Distribution pursuant to Rule 12b-1 under the
Investment Company Act between the Fund and the Distributor, the Distributor
provides certain services in connection with the promotion of sales of Fund
shares (the "Plan").
The Plan provides that the Distributor bears the expense of all promotional
and distribution related activities on behalf of the Fund, except for expenses
that the Trustees determine to reimburse, as described below. The following
activities and services may be provided by the Distributor under the Plan: (1)
compensation to and expenses of Dean Witter Reynolds' and other selected
Broker-Dealers' Financial Advisors and other employees, including overhead and
telephone expenses; (2) sales incentives and bonuses to sales representatives
and to marketing personnel in connection with promoting sales of the Fund's
shares; (3) expenses incurred in connection with promoting sales of the Fund's
shares; (4) preparing and distributing sales literature; and (5) providing
advertising and promotional activities, including direct mail solicitation and
television, radio, newspaper, magazine and other media advertisements.
The Investment Manager will compensate Financial Advisors at an annual rate
of 0.025% of the value of shares of the Fund acquired by exchange from an MSDW
Open-end Fund provided that the shares exchanged would otherwise have been
eligible for the payment of a retention fee. Such eligible shares must have been
purchased after January 1, 2000 and held for at least one year. Shares owned in
variable annuities, closed-end fund shares held in 401(k) plans where the
Transfer Agent or Dean Witter Reynolds' Retirement Plan Services is either
recordkeeper or trustee are not eligible for a retention fee.
The retention fees are paid by the Investment Manager from its own assets,
which may include profits from investment management fees payable under the
Management Agreement, as well as from borrowed funds.
Dean Witter Reynolds' Financial Advisors are paid an annual residual
commission, currently a residual of up to 0.10% of the current value of the
respective accounts for which they are the Financial Advisors of record. The
residual is a charge which reflects residual commissions paid by Dean Witter
Reynolds to its Financial Advisors and Dean Witter Reynolds' expenses associated
with the servicing of shareholders' accounts, including the expenses of
operating Dean Witter Reynolds' branch offices in connection with the servicing
of shareholders' accounts, which expenses include lease costs, the salaries and
employee benefits of operations and sales support personnel, utility costs,
communications costs and the costs of stationery and supplies and other expenses
relating to branch office serving of shareholder accounts.
The Fund is authorized to reimburse specific expenses incurred or to be
incurred in promoting the distribution of the Fund's shares. Reimbursement is
made through payments at the end of each month. The amount of each monthly
payment may in no event exceed an amount equal to a payment at the annual rate
of 0.15 of 1% of the Fund's average daily net assets during the month. No
interest or other financing charges will be incurred for which reimbursement
payments under the Plan will be made. In addition, no interest charges, if any,
incurred on any distribution expense incurred by the Distributor or other
selected dealers pursuant to the Plan, will be reimbursable under the Plan. In
the case of all expenses other than expenses representing a residual to
Financial Advisors, such amounts shall be
16
<PAGE>
determined at the beginning of each calendar quarter by the Trustees, including
a majority of the Independent 12b-1 Trustees. Expenses representing a residual
to Financial Advisors may be reimbursed without prior determination. In the
event that the Distributor proposes that monies shall be reimbursed for other
than such expenses, then in making quarterly determinations of the amounts that
may be expended by the Fund, the Investment Manager provides and the Trustees
review a quarterly budget of projected incremental distribution expenses to be
incurred on behalf of the Fund, together with a report explaining the purposes
and anticipated benefits of incurring such expenses. The Trustees determine
which particular expenses, and the portions thereof, that may be borne by the
Fund, and in making such a determination shall consider the scope of the
Distributor's commitment to promoting the distribution of the Fund's shares.
The Fund reimbursed $795,443 to the Distributor pursuant to the Plan which
amounted to .08% of the Fund's average daily net assets for the fiscal year
ended January 31, 2000. Based upon the total amounts spent by the Distributor
during the period, it is estimated that the amount paid by the Fund to the
Distributor for distribution was spent in approximately the following ways: (i)
advertising -- $-0-; (ii) printing and mailing PROSPECTUSES to other than
current shareholders -- $-0-; (iii) compensation to underwriters -- $-0-; (iv)
compensation to dealers --$-0-; (v) compensation to sales personnel -- $-0-; and
(vi) other, which includes payments to Dean Witter Reynolds for expenses
substantially all of which relate to compensation of sales personnel and
associated overhead expenses -- $795,443. No payments under the Plan were made
for interest, carrying or other financing charges.
Under the Plan, the Distributor uses its best efforts in rendering services
to the Fund, but in the absence of willful misfeasance, bad faith, gross
negligence or reckless disregard of its obligations, the Distributor is not
liable to the Fund or any of its shareholders for any error of judgment or
mistake of law or for any act or omission or for any losses sustained by the
Fund or its shareholders.
Under the Plan, the Distributor provides the Fund, for review by the
Trustees, and the Trustees review, promptly after the end of each calendar
quarter, a written report regarding the incremental distribution expenses
incurred on behalf of the Fund during such calendar quarter, which report
includes (1) an itemization of the types of expenses and the purposes therefore;
(2) the amounts of such expenses; and (3) a description of the benefits derived
by the Fund. In the Trustees' quarterly review of the Plan they consider its
continued appropriateness and the level of compensation provided therein.
No interested person of the Fund nor any Independent Trustee has any direct
financial interest in the operation of the Plan except to the extent that the
Distributor, the Investment Manager, Dean Witter Reynolds, MSDW Services Company
or certain of their employees may be deemed to have such an interest as a result
of benefits derived from the successful operation of the Plan or as a result of
receiving a portion of the amounts expended thereunder by the Fund.
On an annual basis, the Trustees, including a majority of the Independent
Trustees, consider whether the Plan should be continued. Prior to approving the
most recent continuation of the Plan, the Trustees requested and received from
the Distributor and reviewed all the information which they deemed necessary to
arrive at an informed determination. In making their determination to continue
the Plan, the Trustees considered: (1) the Fund's experience under the Plan and
whether such experience indicates that the Plan is operating as anticipated;
(2) the benefits the Fund had obtained, was obtaining and would be likely to
obtain under the Plan, including that: (a) the Plan is essential in order to
implement the Fund's method of distribution and to enable the Fund to continue
to grow and avoid a pattern of net redemptions which, in turn, are essential for
effective investment management; and (b) without the reimbursement of
distribution and account maintenance expenses of Dean Witter Reynolds' branch
offices made possible by the 12b-1 fees, Dean Witter Reynolds could not
establish and maintain an effective system for distribution, servicing of Fund
shareholders and maintenance of shareholder accounts; and (3) what services had
been provided and were continuing to be provided under the Plan to the Fund and
its shareholders. Based upon their review, the Trustees, including each of the
Independent Trustees, determined that continuation of the Plan would be in the
best interest of the Fund and would have a reasonable likelihood of continuing
to benefit the Fund and its shareholders. In the Trustees' quarterly review of
the Plan, they will consider its continued appropriateness and the level of
compensation provided therein.
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The Plan may not be amended to increase materially the amount to be spent
for the services described therein without approval by the shareholders of the
Fund, and all material amendments to the Plan must also be approved by the
Trustees in the manner described above. The Plan may be terminated at any time,
without payment of any penalty, by vote of a majority of the Independent
Trustees or by a vote of a majority of the outstanding voting securities of the
Fund (as defined in the Investment Company Act) on not more than thirty days'
written notice to any other party to the Plan. So long as the Plan is in effect,
the election and nomination of Independent Trustees shall be committed to the
discretion of the Independent Trustees.
E. OTHER SERVICE PROVIDERS
(1) TRANSFER AGENT/DIVIDEND-PAYING AGENT
Morgan Stanley Dean Witter Trust FSB is the transfer agent for the Fund's
shares and the Dividend Disbursing Agent for payment of dividends and
distributions on Fund shares and Agent for shareholders under various investment
plans. The principal business address of the Transfer Agent is Harborside
Financial Center, Plaza Two, Jersey City, NJ 07311.
(2) CUSTODIAN AND INDEPENDENT ACCOUNTANTS
The Bank of New York, 100 Church Street, New York, NY 10007 is the Custodian
for the Fund's assets. Any of the Fund's cash balances with the Custodian in
excess of $100,000 are unprotected by federal deposit insurance. These balances
may, at times, be substantial.
PricewaterhouseCoopers LLP, 1177 Avenue of the Americas, New York, NY 10036
serves as the independent accountants of the Fund. The independent accountants
are responsible for auditing the annual financial statements of the Fund.
(3) AFFILIATED PERSONS
The Transfer Agent is an affiliate of the Investment Manager, and of the
Distributor. As Transfer Agent and Dividend Disbursing Agent, the Transfer
Agent's responsibilities include maintaining shareholder accounts, disbursing
cash dividends and reinvesting dividends, processing account registration
changes, handling purchase and redemption transactions, mailing prospectuses and
reports, mailing and tabulating proxies, processing share certificate
transactions, and maintaining shareholder records and lists. For these services,
the Transfer Agent receives a per shareholder account fee from the Fund and is
reimbursed for its out-of-pocket expenses in connection with such services.
F. CODES OF ETHICS
The Fund, the Investment Manager and the Distributor have each adopted a
Code of Ethics pursuant to Rule 17j-1 under the Investment Company Act. The
Codes of Ethics are designed to detect and prevent improper personal trading.
The Codes of Ethics permit personnel subject to the Codes to invest in
securities, including securities that may be purchased, sold or held by the
Fund, subject to a number of restrictions and controls including prohibitions
against purchases of securities in an Initial Public Offering and a preclearance
requirement with respect to personal securities transactions.
VI. BROKERAGE ALLOCATION AND OTHER PRACTICES
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A. BROKERAGE TRANSACTIONS
Subject to the general supervision of the Trustees, the Investment Manager
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 brokerage commissions, if any. Purchases and sales of portfolio securities
are normally transacted through issuers, underwriters or major dealers in U.S.
Government securities acting as principals. Such transactions are made 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.
During the fiscal years ended January 31, 1998, 1999 and 2000, the Fund paid
no such brokerage commissions or concessions.
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B. COMMISSIONS
Pursuant to an order of the SEC, the Fund may effect principal transactions
in certain money market instruments with Dean Witter Reynolds. The Fund will
limit its transactions with Dean Witter Reynolds to U.S. Government and
Government Agency Securities. The transactions will be effected with Dean Witter
Reynolds only when the price available from Dean Witter Reynolds is better than
that available from other dealers.
During the fiscal years ended January 31, 1998, 1999 and 2000, the Fund did
not effect any principal transactions with Dean Witter Reynolds.
Brokerage transactions in securities listed on exchanges or admitted to
unlisted trading privileges may be effected through Dean Witter Reynolds, Morgan
Stanley & Co. and other affiliated brokers and dealers. In order for an
affiliated broker or dealer to effect any portfolio transactions on an exchange
for the Fund, the commissions, fees or other remuneration received by the
affiliated broker or dealer 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 the
affiliated broker or dealer 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 Trustees, including the Independent
Trustees, have adopted procedures which are reasonably designed to provide that
any commissions, fees or other remuneration paid to an affiliated broker or
dealer are consistent with the foregoing standard. The Fund does not reduce the
management fee it pays to the Investment Manager by any amount of the brokerage
commissions it may pay to an affiliated broker or dealer.
During the fiscal years ended January 31, 1998, 1999 and 2000, the Fund paid
no brokerage commissions to an affiliated broker or dealer.
C. BROKERAGE SELECTION
The policy of the Fund regarding purchases and sales of securities for its
portfolio is that primary consideration will be given to obtaining the most
favorable prices and efficient executions of transactions.
In seeking to implement the Fund's policies, the Investment Manager effects
transactions with those brokers and dealers who the Investment Manager believes
provide the most favorable prices and are capable of providing efficient
executions. If the Investment Manager believes the prices and executions 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 Fund or the Investment Manager. The 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.
The information and services received by the Investment Manager from brokers
and dealers may be of benefit to the Investment Manager in the management of
accounts of some of its other clients and may not in all cases benefit the Fund
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 thereby reduce its expenses,
it is of indeterminable value and the Fund does not reduce the management fee it
pays to the Investment Manager by any amount that may be attributable to the
value of such services.
Subject to the principle of obtaining best price and execution, the
Investment Manager may consider a broker-dealer's sales of shares of the Fund as
a factor in selecting from among those broker-dealers qualified to provide
comparable prices and execution on the Fund's portfolio transactions. The Fund
does not, however, require a broker-dealer to sell shares of the Fund in order
for it to be considered to execute portfolio transactions, and will not enter
into any arrangement whereby a specific amount or
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percentage of the Fund's transactions will be directed to a broker which sells
shares of the Fund to customers. The Trustees review, periodically, the
allocation of brokerage orders to monitor the operation of these policies.
The Investment Manager currently serves as investment manager to a number of
clients, including other investment companies, and may in the future act as
investment manager or advisor to others. It is the practice of the Investment
Manager to cause purchase and sale transactions to be allocated among the Fund
and others whose assets it manages in such manner as it deems equitable. In
making such allocations among the Fund and other client accounts, various
factors may be considered, including 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 Fund and other client accounts. In the case of certain initial
and secondary public offerings, the Investment Manager utilizes a pro rata
allocation process based on the size of the Morgan Stanley Dean Witter Funds
involved and the number of shares available from the public offering.
D. DIRECTED BROKERAGE
During the fiscal year ended January 31, 2000, the Fund did not pay any
brokerage commissions to brokers because of research services provided.
E. REGULAR BROKER-DEALERS
During the fiscal year ended January 31, 2000, the Fund did not purchase
securities issued by brokers or dealers that were among the ten brokers or the
ten dealers which executed transactions for or with the Fund in the largest
dollar amounts during the year. At January 31, 2000, the Fund did not own any
securities issued by any of such issuers.
VII. CAPITAL STOCK AND OTHER SECURITIES
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The shareholders of the Fund are entitled to a full vote for each full share
of beneficial interest held. The Fund is authorized to issue an unlimited number
of shares of beneficial interest. All shares of beneficial interest of the Fund
are of $0.01 par value and are equal as to earnings, assets and voting
privileges.
The Fund's Declaration of Trust permits the Trustees to authorize the
creation of additional series of shares (the proceeds of which would be invested
in separate, independently managed portfolios) and additional Classes of shares
within any series. The Trustees have not presently authorized any such
additional series or Classes of shares other than as set forth in the
PROSPECTUS.
The Fund is not required to hold annual meetings of shareholders and in
ordinary circumstances the Fund does not intend to hold such meetings. The
Trustees may call special meetings of shareholders for action by shareholder
vote as may be required by the Investment Company Act or the Declaration of
Trust. Under certain circumstances, the Trustees may be removed by the actions
of the Trustees. In addition, under certain circumstances, the shareholders may
call a meeting to remove the Trustees and the Fund is required to provide
assistance in communicating with shareholders about such a meeting. The voting
rights of shareholders are not cumulative, so that holders of more than 50
percent of the shares voting can, if they choose, elect all Trustees being
selected, while the holders of the remaining shares would be unable to elect any
Trustees.
Under Massachusetts law, shareholders of a business trust may, under certain
limited circumstances, be held personally liable as partners for the obligations
of the Fund. However, the Declaration of Trust contains an express disclaimer of
shareholder liability for acts or obligations of the Fund, requires that notice
of such Fund obligations include such disclaimer, and provides for
indemnification out of the Fund's property for any shareholder held personally
liable for the obligations of the Fund. Thus, the risk of a shareholder
incurring financial loss on account of shareholder liability is limited to
circumstances in which the Fund itself would be unable to meet its obligations.
Given the above limitations on shareholder
20
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personal liability, and the nature of the Fund's assets and operations, the
possibility of the Fund being unable to meet its obligations is remote and thus,
in the opinion of Massachusetts counsel to the Fund, the risk to Fund
shareholders of personal liability is remote.
All of the Trustees have been elected by the shareholders of the Fund, most
recently at a Special Meeting of Shareholders held on May 21, 1997. The Trustees
themselves have the power to alter the number and the terms of office of the
Trustees (as provided for in the Declaration of Trust), and they may at any time
lengthen or shorten their own terms or make their terms of unlimited duration
and appoint their own successors, provided that always at least a majority of
the Trustees has been elected by the shareholders of the Fund.
VIII. PURCHASE, REDEMPTION AND PRICING OF SHARES
- --------------------------------------------------------------------------------
A. PURCHASE/REDEMPTION OF SHARES
Information concerning how Fund shares are offered to the public (and how
they are redeemed and exchanged) is provided in the Fund's PROSPECTUS.
TRANSFER AGENT AS AGENT. With respect to the redemption or repurchase of
Fund shares, the application of proceeds to the purchase of new shares in the
Fund or any other Morgan Stanley Dean Witter Funds and the general
administration of the exchange privilege, the Transfer Agent acts as agent for
the Distributor and for the shareholder's authorized broker-dealer, if any, in
the performance of such functions. With respect to exchanges, redemptions or
repurchases, the Transfer Agent shall be liable for its own negligence and not
for the default or negligence of its correspondents or for losses in transit.
The Fund shall not be liable for any default or negligence of the Transfer
Agent, the Distributor or any authorized broker-dealer.
The Distributor and any authorized broker-dealer have appointed the Transfer
Agent to act as their agent in connection with the application of proceeds of
any redemption of Fund shares to the purchase of shares of any other Morgan
Stanley Dean Witter Fund and the general administration of the exchange
privilege. No commission or discounts will be paid to the Distributor or any
authorized broker-dealer for any transaction pursuant to the exchange privilege.
REDEMPTIONS. A check drawn by a shareholder against his or her account in
the Fund constitutes a request for redemption of a number of shares sufficient
to provide proceeds equal to the amount of the check. Payment of the proceeds
will normally be made on the next business day after receipt by the Transfer
Agent of the check in proper form. If a check is presented for payment to the
Transfer Agent by a shareholder or payee in person, the Transfer Agent will make
payment by means of a check drawn on the Fund's account or, in the case of a
shareholder payee, to the shareholder's predesignated bank account, but will not
make payment in cash.
B. OFFERING PRICE
The price of Fund shares, called "net asset value," is based on the value of
the Fund's portfolio securities.
The Fund utilizes the amortized cost method in valuing its portfolio
securities for purposes of determining the net asset value of its shares. The
Fund utilizes the amortized cost method in valuing its portfolio securities even
though the portfolio securities may increase or decrease in market value,
generally in connection with changes in interest rates. The amortized cost
method of valuation involves valuing a security at its cost at the time of
purchase adjusted by a constant amortization to maturity of any discount or
premium, regardless of the impact of fluctuating interest rates on the market
value of the instrument. While this method provides certainty in valuation, it
may result in periods during which value, as determined by amortized cost, is
higher or lower than the price the Fund would receive if it sold the investment.
During such periods, the yield to investors in the Fund may differ somewhat from
that obtained in a similar company which uses market-to-market values for all of
its portfolio securities. For example, if the use of amortized cost resulted in
a lower (higher) aggregate portfolio value on a particular day, a prospective
investor in the Fund would be able to obtain a somewhat higher (lower) yield
than
21
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would result from investment in such a similar company and existing investors
would receive less (more) investment income. The purpose of this method of
calculation is to facilitate the maintenance of a constant net asset value per
share of $1.00.
The use of the amortized cost method to value the portfolio securities of
the Fund and the maintenance of the per share net asset value of $1.00 is
permitted pursuant to Rule 2a-7 of the Act (the "Rule") and is conditioned on
its compliance with various conditions contained in the Rule including: (a) the
Trustees are obligated, as a particular responsibility within the overall duty
of care owed to the Fund's shareholders, to establish procedures reasonably
designed, taking into account current market conditions and the Fund's
investment objectives, to stabilize the net asset value per share as computed
for the purpose of distribution and redemption at $1.00 per share; (b) the
procedures include (i) calculation, at such intervals as the Trustees determine
are appropriate and as are reasonable in light of current market conditions, of
the deviation, if any, between net asset value per share using amortized cost to
value portfolio securities and net asset value per share based upon available
market quotations with respect to such portfolio securities; (ii) periodic
review by the Trustees of the amount of deviation as well as methods used to
calculate it; and (iii) maintenance of written records of the procedures, and
the Trustees' considerations made pursuant to them and any actions taken upon
such consideration; (c) the Trustees should consider what steps should be taken,
if any, in the event of a difference of more than 1/2 of 1% between the two
methods of valuation; and (d) the Trustees should take such action as they deem
appropriate (such as shortening the average portfolio maturity, realizing gains
or losses, withholding dividends or, as provided by the Declaration of Trust,
reducing the number of outstanding shares of the Fund) to eliminate or reduce to
the extent reasonably practicable material dilution or other unfair results to
investors or existing shareholders which might arise from differences between
the two method of valuation.
Generally, for purposes of the procedures adopted under the Rule, the
maturity of a portfolio security is deemed to be the period remaining
(calculated from the trade date or such other date on which the Fund's interest
in the instrument is subject to market action) until the date on which in
accordance with the terms of the security the principal amount must
unconditionally be paid, or in the case of a security called for redemption, the
date on which the redemption payment must be made.
A variable rate security that is subject to a demand feature is deemed to
have a maturity equal to the period remaining until the principal amount can be
recovered through demand. A floating rate security that is subject to a demand
feature is deemed to have a maturity equal to the period remaining until the
principal amount can be recovered through demand.
An "NRSRO" is a nationally recognized statistical rating organization. The
term "Requisite NRSROs" means (i) any two NRSROs that have issued a rating with
respect to a security or class of debt obligations of an issuer, or (ii) if only
one NRSRO has issued a rating with respect to such security or issuer at the
time a fund purchases or rolls over the security, that NRSRO.
An Eligible Security is generally defined in the Rule to mean (i) a rated
security with a remaining maturity of 397 calendar days or less that has
received a rating from the Requisite NRSROs in one of the two highest short-term
rating categories (within which there may be sub-categories or gradations
indicating relative standing); or (ii) An Unrated Security that is of comparable
quality to a security meeting the requirements of (1) above, as determined by
Trustees; (iii) In addition, in the case of a security that is subject to a
Demand Feature or Guarantee: (A) The Guarantee has received a rating from an
NRSRO or the Guarantee is issued by a guarantor that has received a rating from
an NRSRO with respect to a class of debt obligations (or any debt obligation
within that class) that is comparable in priority and security to the Guarantee,
unless: (1) the Guarantee is issued by a person that directly or indirectly,
controls, is controlled by or is under a common control with the issuer of the
security subject to the Guarantee (other than a sponsor or a Special Purpose
Entity with respect to an Asset Backed Security: (2) the security subject to the
Guarantee is a repurchase agreement that is Collateralized Fully; or (3) the
Guarantee itself is a Government Security and (B) the issuer of the Demand
Feature, or another institution, has undertaken promptly to notify the holder of
the security in the event the Demand Feature
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or Guarantee is substituted with another Demand Feature or Guarantee (if such
substitution is permissible under the terms of the Demand Feature or Guarantee).
The Fund will limit its investments to securities that meet the requirements for
Eligible Securities.
As permitted by the Rule, the Trustees have delegated to the Fund's
Investment Manager the authority to determine which securities present minimal
credit risks and which unrated securities are comparable in quality to rated
securities.
Also, as required by the Rule, the Fund will limit its investments in
securities, other than Government securities, so that, at the time of purchase:
(a) except as further limited in (b) below with regard to certain securities, no
more than 5% of its total assets will be invested in the securities of any one
issuer; and (b) with respect to Eligible Securities that have received a rating
in less than the highest category by any one of the NRSROs whose ratings are
used to qualify the security as an Eligible Security, or that have been
determined to be of comparable quality: (i) no more than 5% in the aggregate of
the Fund's total assets in all such securities, and (ii) no more than the
greater of 1% of total assets, or $1 million, in the securities on any one
issuer.
The Rule further requires that the Fund limit its investments to U.S.
dollar-denominated instruments which the Trustees determine present minimal
credit risks and which are Eligible Securities. The Rule also requires the Fund
to maintain a dollar-weighted average portfolio maturity (not more than 90 days)
appropriate to its objective of maintaining a stable net asset value of $1.00
per share and precludes the purchase of any instrument with a remaining maturity
of more than 397 days. Should the disposition of a portfolio security result in
a dollar-weighted average portfolio maturity of more than 90 days, the Fund will
invest its available cash in such a manner as to reduce such maturity to 90 days
or less a soon as is reasonably practicable.
If the Trustees determine that it is no longer in the best interests of the
Fund and its shareholders to maintain a stable price of $1 per share or if the
Trustees believe that maintaining such price no longer reflects a market-based
net asset value per share, the Trustees have the right to change from an
amortized cost basis of valuation to valuation based on market quotations. The
Fund will notify shareholders of the Fund of any such change.
IX. TAXATION OF THE FUND AND SHAREHOLDERS
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The Fund intends to distribute all of its daily net investment income (and
net short-term capital gains, if any) to shareholders of record as of the close
of business the preceding business day. Net income, for dividend purposes,
includes accrued interest and amortization of acquisition, original issue and
market discount, plus or minus any short-term gains or losses realized on sales
of portfolio securities, less the amortization of market premium and the
estimated expenses of the Fund. Net income will be calculated immediately prior
to the determination of net asset value per share of the Fund.
The Trustees of the Fund may revise the dividend policy, or postpone the
payment of dividends, if the Fund should have or anticipate any large unexpected
expense, loss or fluctuation in net assets which, in the opinion of the
Trustees, might have a significant adverse effect on shareholders. On occasion,
in order to maintain a constant $1.00 per share net asset value, the Trustees
may direct that the number of outstanding shares be reduced in each
shareholder's account. Such reduction may result in taxable income to a
shareholder in excess of the net increase (i.e., dividends, less such
reductions), if any, in the shareholder's account for a period of time.
Furthermore, such reduction may be realized as a capital loss when the shares
are liquidated.
It has been and remains the Trust's policy and practice that, if checks for
dividends or distributions paid in cash remain uncashed, no interest will accrue
on amounts represented by such uncashed checks.
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INVESTMENT COMPANY TAXATION. The Fund has qualified and intends to remain
qualified as a regulated investment company under Subchapter M of the Internal
Revenue Code. If so qualified, the Fund will not be subject to federal income
taxes, provided that it distributes all of its taxable net investment income and
all of its net realized gains.
Gains or losses on sales of securities held by the Fund will be long-term
capital gains or losses if the securities have a tax holding period of more than
one year. Gains or losses on the sale of securities with a tax holding period of
one year or less will be short-term gains or losses.
Under present Massachusetts law, the Fund is not subject to any
Massachusetts income tax during any fiscal year in which the Fund qualifies as a
regulated investment company. The Fund might be subject to Massachusetts income
taxes for any taxable year in which it does not so qualify as a regulated
investment company.
The Fund may be subject to tax or taxes in certain states where it does
business. Furthermore, in those states which have income tax laws, the tax
treatment of the Fund and of shareholders with respect to distributions by the
Fund may differ from federal tax treatment.
TAXATION OF DIVIDENDS AND DISTRIBUTIONS. Shareholders will normally be
subject to federal income tax, and any state and local income taxes, on
dividends paid from interest income derived from taxable securities and on
distributions of realized net short-term capital gains and long-term capital
gains. Interest and realized net short-term capital gains distributions are
taxable to the shareholder as ordinary dividend income regardless of whether the
shareholder receives such distributions in additional shares or in cash. Since
the Trust's income is expected to be derived entirely from interest rather than
dividends, none of such distributions will be eligible for the federal dividends
received deduction available to corporations. Realized net long-term capital
gains distributions, if any, are taxable as long-term capital gains, regardless
of how long the shareholder has held the Fund shares and regardless of whether
the distribution is received in additional shares or in cash. Realized net
long-term capital gains distributions are not eligible for the dividends
received deduction.
Shareholders who are not citizens or residents of the United States and
certain foreign entities may be subject to withholding of United States tax on
distributions made by the Fund of any taxable interest income and short-term
capital gains.
After the end of each calendar year, shareholders will be sent information
on their dividends and capital gain distributions for tax purposes, including
the portion taxable as ordinary income, the portion taxable as long-term capital
gains and the amount of any dividends eligible for the federal dividends
received deduction for corporations.
Shareholders are urged to consult their own tax advisors regarding specific
questions as to federal, state or local taxes.
X. UNDERWRITERS
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The Fund's shares are offered to the public on a continuous basis. The
Distributor, as the principal underwriter of the shares, has certain obligations
under the Distribution Agreement concerning the distribution of the shares.
These obligations and the compensation the Distributor receives are described
above in the sections titled "Principal Underwriter" and "Rule 12b-1 Plan."
XI. CALCULATION OF PERFORMANCE DATA
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The Fund's current yield for the seven days ending January 31, 2000 was
4.90%. The seven day effective yield on January 31, 2000, was 5.02% assuming
daily compounding.
The Fund's annualized current yield, as may be quoted from time to time in
advertisements and other communications to shareholders and potential investors,
is computed by determining, for a stated seven-day period, the net change,
exclusive of capital changes and including the value of additional
24
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shares purchased with dividends and any dividends declared therefrom (which
reflect deductions of all expenses of the Fund such as management fees), in the
value of a hypothetical pre-existing account having a balance of one share at
the beginning of the period, and dividing the difference by the value of the
account at the beginning of the base period to obtain the base period return,
and then multiplying the base period return by (365/7).
The Fund's annualized effective yield, as may be quoted from time to time in
advertisements and other communications to shareholders and potential investors,
is computed by determining (for the same stated seven-day period as for the
current yield), the net change, exclusive of capital changes and including the
value of additional shares purchased with dividends and any dividends declared
therefrom (which reflect deductions of all expenses of the Fund such as
management fees), in the value of a hypothetical pre-existing account having a
balance of one share at the beginning of the period, and dividing the difference
by the value of the account at the beginning of the base period to obtain the
base period return, and then compounding the base period return by adding 1,
raising the sum to a power equal to 365 divided by 7, and subtracting 1 from the
result.
The yields quoted in any advertisement or other communication should not be
considered a representation of the yields of the Fund in the future since the
yield is not fixed. Actual yields will depend not only on the type, quality and
maturities of the investments held by the Fund and changes in interest rates on
such investments, but also on changes in the Fund's expenses during the period.
Yield information may be useful in reviewing the performance of the Fund and
for providing a basis for comparison with other investment alternatives.
However, unlike bank deposits or other investments which typically pay a fixed
yield for a stated period of time, the Fund's yield fluctuates.
The Fund may also advertise the growth of hypothetical investments of
$10,000, $50,000 and $100,000 in shares of the Fund by adding the sum of all
distributions on 10,000, 50,000 or 100,000 shares of the Fund since inception to
$10,000, $50,000 and $100,000, as the case may be. Investments of $10,000,
$50,000 and $100,000 in the Fund at inception (February 17, 1982) would have
grown to $28,136, $140,680 and $281,360, respectively, at January 31, 2000.
XII. FINANCIAL STATEMENTS
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EXPERTS. The financial statements of the Fund for the fiscal year ended
January 31, 2000 included in the PROSPECTUS and incorporated by reference in
this STATEMENT OF ADDITIONAL INFORMATION have been so included and incorporated
in reliance on the report of PricewaterhouseCoopers LLP, independent
accountants, given on the authority of said firm as experts in auditing and
accounting.
*****
This STATEMENT OF ADDITIONAL INFORMATION and the PROSPECTUS do not contain
all of the information set forth in the REGISTRATION STATEMENT the Fund has
filed with the SEC. The complete REGISTRATION STATEMENT may be obtained from the
SEC.
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MORGAN STANLEY DEAN WITTER
U.S. GOVERNMENT MONEY MARKET MONEY MARKET TRUST
PART C OTHER INFORMATION
ITEM 23. EXHIBITS
1(a). Declaration of Trust of the Registrant, dated November 18, 1981, is
incorporated by reference to Exhibit 1(a) of Post-Effective Amendment
No. 16 to the Registration Statement on Form N-1A, filed on March 15,
1996.
1(b). Amendment to the Declaration of Trust of the Registrant, dated January
18, 1983, is incorporated by reference to Exhibit 1(b) of
Post-Effective Amendment No. 16 to the Registration Statement on Form
N-1A, filed on March 15, 1996.
1(c). Amendment to the Declaration of Trust of the Registrant, dated May 18,
1984, is incorporated by reference to Exhibit 1(c) of Post-Effective
Amendment No. 16 to the Registration Statement on Form N-1A, filed on
March 15, 1996.
1(d). Amendment to the Declaration of Trust of the Registrant, dated June
22, 1984, is incorporated by reference to Exhibit 1(d) of
Post-Effective Amendment No. 16 to the Registration Statement on Form
N-1A, filed on March 15, 1996.
1(e). Amendment to the Declaration of Trust of the Registrant, dated
February 19, 1993, is incorporated by reference to Exhibit 1(e) of
Post-Effective Amendment No. 16 to the Registration Statement on Form
N-1A, filed on March 15, 1996.
1(f). Amendment to the Declaration of Trust of the Registrant, dated June
22, 1998, is incorporated by reference to Exhibit 1 of Post-Effective
Amendment No. 19 to the Registration Statement on Form N-1A, filed on
January 27, 1999.
2. Amended and Restated By-Laws of the Registrant, dated May 1, 1999,
filed herein.
3. Not applicable.
4. Amended Investment Management Agreement between the Registrant and
Morgan Stanley Dean Witter Advisors Inc., dated April 30, 1998, is
incorporated by reference to Exhibit 5 of Post-Effective Amendment No.
19 to the Registration Statement on Form N-1A, filed on January 27,
1999.
5(a). Form of Distribution Agreement between the Registrant and Morgan
Stanley Dean Witter Distributors Inc., dated May 31, 1997, is
incorporated by reference to Exhibit 6 of Post-Effective Amendment No.
18 to the Registration Statement on Form N-1A, filed on March 2, 1998.
5(b). Form of Selected Dealers Agreement between Morgan Stanley Dean Witter
Distributors Inc. and Dean Witter Reynolds Inc., dated January 4,
1993, is incorporated by reference to Exhibit 6(b) of Post-Effective
Amendment No. 14 to the Registration Statement on Form N-1A, filed on
March 11, 1994.
<PAGE>
6. Amended and Restated Retirement Plan for Non-Interested Trustees or
Directors, dated May 8, 1997, is incorporated by reference to Exhibit
6 of Post-Effective Amendment No. 20 to the Registration Statement on
Form N-1A, filed on March 29, 1999.
7(a). Form of Custody Agreement between The Bank of New York and the
Registrant, dated September 20, 1991, is incorporated by reference to
Exhibit 8 of Post-Effective Amendment No. 16 to the Registration
Statement on Form N-1A, filed on March 15, 1996.
7(b). Amendment to the Custody Agreement between The Bank of New York and
the Registrant, dated April 17,1996, is incorporated by reference to
Exhibit 8 of Post-Effective Amendment No. 17 to the Registration
Statement on Form N-1A, filed on March, 18, 1997.
8(a). Amended and Restated Transfer Agency Agreement between the Registrant
and Morgan Stanley Dean Witter Trust FSB, dated June 22, 1998, is
incorporated by reference to Exhibit 8 of Post-Effective Amendment No.
19 to the Registration Statement on Form N-1A, filed on January 27,
1999.
8(b). Amended Services Agreement between Morgan Stanley Dean Witter Advisors
Inc. and Morgan Stanley Dean Witter Services Company Inc., dated June
22, 1998, is incorporated by reference to Exhibit 9 of Post-Effective
Amendment No. 19 to the Registration Statement on Form N-1A, filed on
January 27, 1999.
9. Opinion of Latham, Watkins & Hills, dated February 8, 1982, filed
herein.
10. Consent of Independent Accountants, filed herein.
11. Not applicable.
12. Not applicable.
13. Amended and Restated Plan of Distribution pursuant to Rule 12b-1
between the Registrant and Morgan Stanley Dean Witter Distributors
Inc., dated July 28, 1997, is incorporated by reference to Exhibit 15
of Post-Effective Amendment No. 18 to the Registration Statement on
Form N-1A, filed on March 2, 1998.
14. Not Applicable
15. Not Applicable
16(a). Code of Ethics of Morgan Stanley Dean Witter Advisors Inc.,
Morgan Stanley Dean Witter Services Company Inc. and
Morgan Stanley Dean Witter Distributors Inc., filed herein.
16(b). Code of Ethics of the Morgan Stanley Dean Witter Funds, filed
herein.
Other. Powers of Attorney of Trustees are incorporated by reference to
Exhibit (Other) of Post-Effective Amendment No. 15 to the Registration
Statement on Form N-1A, filed on March 17,1995 and to Exhibit (Other)
of Post-Effective Amendment No. 18 to the Registration Statement on
Form N-1A, filed on March 2, 1998.
2
<PAGE>
Item 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND.
None
Item 25. INDEMNIFICATION.
Pursuant to Section 5.3 of the Registrant's Declaration of Trust and under
Section 4.8 of the Registrant's By-Laws, the indemnification of the Registrant's
trustees, officers, employees and agents is permitted if it is determined that
they acted under the belief that their actions were in or not opposed to the
best interest of the Registrant, and, with respect to any criminal proceeding,
they had reasonable cause to believe their conduct was not unlawful. In
addition, indemnification is permitted only if it is determined that the actions
in question did not render them liable by reason of willful misfeasance, bad
faith or gross negligence in the performance of their duties or by reason of
reckless disregard of their obligations and duties to the Registrant. Trustees,
officers, employees and agents will be indemnified for the expense of litigation
if it is determined that they are entitled to indemnification against any
liability established in such litigation. The Registrant may also advance money
for these expenses provided that they give their undertakings to repay the
Registrant unless their conduct is later determined to permit indemnification.
Pursuant to Section 5.2 of the Registrant's Declaration of Trust and
paragraph 8 of the Registrant's Investment Management Agreement, neither the
Investment Manager nor any trustee, officer, employee or agent of the Registrant
shall be liable for any action or failure to act, except in the case of bad
faith, willful misfeasance, gross negligence or reckless disregard of duties to
the Registrant.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") may be permitted to trustees, officers and
controlling persons of the Registrant pursuant to the foregoing provisions or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a trustee, officer, or controlling
person of the Registrant in connection with the successful defense of any
action, suit or proceeding) is asserted against the Registrant by such trustee,
officer or controlling person in connection with the shares being registered,
the Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act, and will be governed by the final adjudication of such
issue.
The Registrant hereby undertakes that it will apply the
indemnification provision of its by-laws in a manner consistent with Release
11330 of the Securities and Exchange Commission under the Investment Company Act
of 1940, so long as the interpretation of Sections 17(h) and 17(i) of such Act
remains in effect.
Registrant, in conjunction with the Investment Manager, Registrant's
Trustees, and other registered investment management companies managed by the
Investment Manager, maintains insurance on behalf of any person who is or was a
Trustee, officer, employee, or agent of Registrant, or who is or was serving at
the request of Registrant as a trustee, director, officer, employee or agent of
another trust or corporation, against any liability asserted against him and
incurred by him or arising out of his position. However, in no event will
Registrant
3
<PAGE>
maintain insurance to indemnify any such person for any act for which Registrant
itself is not permitted to indemnify him.
Item 26. BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISOR
See "The Fund and Its Management" in the Prospectus regarding the
business of the investment advisor. The following information is given regarding
officers of Morgan Stanley Dean Witter Advisors Inc. ("MSDW Advisors"). MSDW
Advisors is a wholly-owned subsidiary of Morgan Stanley Dean Witter & Co.
The term "Morgan Stanley Dean Witter Funds" refers to the following
registered investment companies:
<TABLE>
<CAPTION>
CLOSED-END INVESTMENT COMPANIES
<S> <C>
(1) Morgan Stanley Dean Witter California Insured Municipal Income Trust
(2) Morgan Stanley Dean Witter California Quality Municipal Securities
(3) Morgan Stanley Dean Witter Government Income Trust
(4) Morgan Stanley Dean Witter High Income Advantage Trust
(5) Morgan Stanley Dean Witter High Income Advantage Trust II
(6) Morgan Stanley Dean Witter High Income Advantage Trust III
(7) Morgan Stanley Dean Witter Income Securities Inc.
(8) Morgan Stanley Dean Witter Insured California Municipal Securities
(9) Morgan Stanley Dean Witter Insured Municipal Bond Trust
(10) Morgan Stanley Dean Witter Insured Municipal Income Trust
(11) Morgan Stanley Dean Witter Insured Municipal Securities
(12) Morgan Stanley Dean Witter Insured Municipal Trust
(13) Morgan Stanley Dean Witter Municipal Income Opportunities Trust
(14) Morgan Stanley Dean Witter Municipal Income Opportunities Trust II
(15) Morgan Stanley Dean Witter Municipal Income Opportunities Trust III
(16) Morgan Stanley Dean Witter Municipal Income Trust
(17) Morgan Stanley Dean Witter Municipal Income Trust II
(18) Morgan Stanley Dean Witter Municipal Income Trust III
(19) Morgan Stanley Dean Witter Municipal Premium Income Trust
(20) Morgan Stanley Dean Witter New York Quality Municipal Securities
(21) Morgan Stanley Dean Witter Prime Income Trust
(22) Morgan Stanley Dean Witter Quality Municipal Income Trust
(23) Morgan Stanley Dean Witter Quality Municipal Investment Trust
(24) Morgan Stanley Dean Witter Quality Municipal Securities
OPEN-END INVESTMENT COMPANIES
(1) Active Assets California Tax-Free Trust
(2) Active Assets Government Securities Trust
(3) Active Assets Institutional Money Trust
(4) Active Assets Money Trust
(5) Active Assets Premier Money Trust
(6) Active Assets Tax-Free Trust
(7) Morgan Stanley Dean Witter 21st Century Trend Fund
(8) Morgan Stanley Dean Witter Aggressive Equity Fund
(9) Morgan Stanley Dean Witter American Opportunities Fund
(10) Morgan Stanley Dean Witter Balanced Growth Fund
(11) Morgan Stanley Dean Witter Balanced Income Fund
4
<PAGE>
(12) Morgan Stanley Dean Witter California Tax-Free Daily Income Trust
(13) Morgan Stanley Dean Witter California Tax-Free Income Fund
(14) Morgan Stanley Dean Witter Capital Growth Securities
(15) Morgan Stanley Dean Witter Competitive Edge Fund, "BEST IDEAS PORTFOLIO"
(16) Morgan Stanley Dean Witter Convertible Securities Trust
(17) Morgan Stanley Dean Witter Developing Growth Securities Trust
(18) Morgan Stanley Dean Witter Diversified Income Trust
(19) Morgan Stanley Dean Witter Dividend Growth Securities Inc.
(20) Morgan Stanley Dean Witter Equity Fund
(21) Morgan Stanley Dean Witter European Growth Fund Inc.
(22) Morgan Stanley Dean Witter Federal Securities Trust
(23) Morgan Stanley Dean Witter Financial Services Trust
(24) Morgan Stanley Dean Witter Fund of Funds
(25) Morgan Stanley Dean Witter Global Dividend Growth Securities
(26) Morgan Stanley Dean Witter Global Utilities Fund
(27) Morgan Stanley Dean Witter Growth Fund
(28) Morgan Stanley Dean Witter Hawaii Municipal Trust
(29) Morgan Stanley Dean Witter Health Sciences Trust
(30) Morgan Stanley Dean Witter High Yield Securities Inc.
(31) Morgan Stanley Dean Witter Income Builder Fund
(32) Morgan Stanley Dean Witter Information Fund
(33) Morgan Stanley Dean Witter Intermediate Income Securities
(34) Morgan Stanley Dean Witter International Fund
(35) Morgan Stanley Dean Witter International SmallCap Fund
(36) Morgan Stanley Dean Witter Japan Fund
(37) Morgan Stanley Dean Witter Latin American Growth Fund
(38) Morgan Stanley Dean Witter Limited Term Municipal Trust
(39) Morgan Stanley Dean Witter Liquid Asset Fund Inc.
(40) Morgan Stanley Dean Witter Market Leader Trust
(41) Morgan Stanley Dean Witter Mid-Cap Dividend Growth Securities
(42) Morgan Stanley Dean Witter Mid-Cap Equity Trust
(43) Morgan Stanley Dean Witter Multi-State Municipal Series Trust
(44) Morgan Stanley Dean Witter Natural Resource Development Securities Inc.
(45) Morgan Stanley Dean Witter New York Municipal Money Market Trust
(46) Morgan Stanley Dean Witter New York Tax-Free Income Fund
(47) Morgan Stanley Dean Witter Next Generation Trust
(48) Morgan Stanley Dean Witter North American Government Income Trust
(49) Morgan Stanley Dean Witter Pacific Growth Fund Inc.
(50) Morgan Stanley Dean Witter Real Estate Fund
(51) Morgan Stanley Dean Witter S&P 500 Index Fund
(52) Morgan Stanley Dean Witter S&P 500 Select Fund
(53) Morgan Stanley Dean Witter Select Dimensions Investment Series
(54) Morgan Stanley Dean Witter Select Municipal Reinvestment Fund
(55) Morgan Stanley Dean Witter Short-Term Bond Fund
(56) Morgan Stanley Dean Witter Short-Term U.S. Treasury Trust
(57) Morgan Stanley Dean Witter Small Cap Growth Fund
(58) Morgan Stanley Dean Witter Special Value Fund
(59) Morgan Stanley Dean Witter Strategist Fund
(60) Morgan Stanley Dean Witter Tax-Exempt Securities Trust
(61) Morgan Stanley Dean Witter Tax-Free Daily Income Trust
(62) Morgan Stanley Dean Witter Total Market Index Fund
5
<PAGE>
(63) Morgan Stanley Dean Witter Total Return Trust
(64) Morgan Stanley Dean Witter U.S. Government Money Market Trust
(65) Morgan Stanley Dean Witter U.S. Government Securities Trust
(66) Morgan Stanley Dean Witter Utilities Fund
(67) Morgan Stanley Dean Witter Value-Added Market Series
(68) Morgan Stanley Dean Witter Value Fund
(69) Morgan Stanley Dean Witter Variable Investment Series
(70) Morgan Stanley Dean Witter World Wide Income Trust
</TABLE>
<TABLE>
<CAPTION>
NAME AND POSITION WITH OTHER SUBSTANTIAL BUSINESS, PROFESSION, VOCATION
MORGAN STANLEY DEAN OR EMPLOYMENT, INCLUDING NAME, PRINCIPAL ADDRESS
WITTER ADVISORS INC. AND NATURE OF CONNECTION
- ----------------------- --------------------------------------------------
<S> <C>
Mitchell M. Merin President and Chief Operating Officer of Asset
President, Chief Management of Morgan Stanley Dean Witter & Co.
Executive Officer and ("MSDW); Chairman, Chief Executive Officer and
Director Director of Morgan Stanley Dean Witter
Distributors Inc. ("MSDW Distributors") and
Morgan Stanley Dean Witter Trust FSB ("MSDW
Trust"); President, Chief Executive Officer and
Director of Morgan Stanley Dean Witter Services
Company Inc. ("MSDW Services"); President of the
Morgan Stanley Dean Witter Funds; Executive Vice
President and Director of Dean Witter Reynolds
Inc. ("DWR"); Director of various MSDW
subsidiaries; Trustee of various Van Kampen
investment companies.
Barry Fink Assistant Secretary of DWR; Executive Vice
Executive Vice President, President, Secretary, General Counsel and
Secretary, General Director of MSDW Services; Executive Vice
Counsel and Director President, Assistant Secretary and Assistant
General Counsel of MSDW Distributors;Vice
President, Secretary and General Counsel of the
Morgan Stanley Dean Witter Funds.
Joseph J. McAlinden Vice President of the Morgan Stanley Dean Witter Funds;
Executive Vice President Director of MSDW Trust.
and Chief Investment
Officer
Ronald E. Robison Executive Vice President, Chief Administrative Officer
Executive Vice President, and Director of MSDW Services; Vice President of the
Chief Administrative Morgan Stanley Dean Witter Funds.
Officer and Director
Edward C. Oelsner, III
Executive Vice President
Joseph R. Arcieri Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
6
<PAGE>
NAME AND POSITION WITH OTHER SUBSTANTIAL BUSINESS, PROFESSION, VOCATION
MORGAN STANLEY DEAN OR EMPLOYMENT, INCLUDING NAME, PRINCIPAL ADDRESS
WITTER ADVISORS INC. AND NATURE OF CONNECTION
- ----------------------- --------------------------------------------------
Peter M. Avelar Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of the High
Yield Group
Mark Bavoso Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
Douglas Brown
Senior Vice President
Rosalie Clough
Senior Vice President
and Director of Marketing
Richard Felegy
Senior Vice President
Sheila A. Finnerty Vice President of Morgan Stanley Dean Witter Prime
Senior Vice President Income Trust.
Edward F. Gaylor Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
Robert S. Giambrone Senior Vice President of MSDW Services, MSDW
Senior Vice President Distributors and MSDW Trust and Director of
MSDW Trust; Vice President of the
Morgan Stanley Dean Witter Funds.
Rajesh K. Gupta Vice President of various Morgan Stanley Dean Witter
Senior Vice President, Funds.
Director of the Taxable
Fixed Income Group and
Chief Administrative Officer -
Investments
Kenton J. Hinchliffe Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
Kevin Hurley Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
Jenny Beth Jones Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
Michelle Kaufman Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
7
<PAGE>
NAME AND POSITION WITH OTHER SUBSTANTIAL BUSINESS, PROFESSION, VOCATION
MORGAN STANLEY DEAN OR EMPLOYMENT, INCLUDING NAME, PRINCIPAL ADDRESS
WITTER ADVISORS INC. AND NATURE OF CONNECTION
- ----------------------- --------------------------------------------------
John B. Kemp, III President of MSDW Distributors.
Senior Vice President
Anita H. Kolleeny Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of Sector
Rotation
Jonathan R. Page Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of the Money
Market Group
Ira N. Ross Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
Guy G. Rutherfurd, Jr. Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of the Growth
Group
Rochelle G. Siegel Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
James Solloway
Senior Vice President
Katherine H. Stromberg Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
Paul D. Vance Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of the Growth
and Income Group
Elizabeth A. Vetell
Senior Vice President
and Director of Shareholder
Communication
James F. Willison Vice President of various Morgan Stanley Dean Witter
Senior Vice President Funds.
and Director of the
Tax-Exempt Fixed
Income Group
8
<PAGE>
NAME AND POSITION WITH OTHER SUBSTANTIAL BUSINESS, PROFESSION, VOCATION
MORGAN STANLEY DEAN OR EMPLOYMENT, INCLUDING NAME, PRINCIPAL ADDRESS
WITTER ADVISORS INC. AND NATURE OF CONNECTION
- ----------------------- --------------------------------------------------
Raymond A. Basile
First Vice President
Thomas F. Caloia First Vice President and Assistant Treasurer of
First Vice President MSDW Services; Assistant Treasurer of MSDW
and Assistant Distributors; Treasurer and Chief Financial and Accounting
Treasurer Officer of the Morgan Stanley Dean Witter Funds.
Thomas Chronert
First Vice President
Marilyn K. Cranney Assistant Secretary of DWR; First Vice President and
First Vice President Assistant Secretary of MSDW Services; Assistant
and Assistant Secretary Secretary of MSDW Distributors and the Morgan Stanley
Dean Witter Funds.
Salvatore DeSteno First Vice President of MSDW Services.
First Vice President
Peter W. Gurman
First Vice President
Michael Interrante First Vice President and Controller of MSDW Services;
First Vice President Assistant Treasurer of MSDW Distributors; First Vice
and Controller President and Treasurer of MSDW Trust.
David Johnson
First Vice President
Stanley Kapica
First Vice President
Douglas J. Ketterer
First Vice President
Todd Lebo First Vice President and Assistant Secretary of MSDW
First Vice President and Services; Assistant Secretary of MSDW Distributors and
Assistant Secretary the Morgan Stanley Dean Witter Funds.
Lou Anne D. McInnis First Vice President and Assistant Secretary of MSDW
First Vice President and Services; Assistant Secretary of MSDW Distributors and
Assistant Secretary the Morgan Stanley Dean Witter Funds.
Carsten Otto First Vice President and Assistant Secretary of MSDW
First Vice President Services; Assistant Secretary of MSDW Distributors and
and Assistant Secretary the Morgan Stanley Dean Witter Funds.
9
<PAGE>
NAME AND POSITION WITH OTHER SUBSTANTIAL BUSINESS, PROFESSION, VOCATION
MORGAN STANLEY DEAN OR EMPLOYMENT, INCLUDING NAME, PRINCIPAL ADDRESS
WITTER ADVISORS INC. AND NATURE OF CONNECTION
- ----------------------- --------------------------------------------------
Carl F. Sadler
First Vice President
Ruth Rossi First Vice President and Assistant Secretary of MSDW
First Vice President Services; Assistant Secretary of MSDW Distributors and
and Assistant Secretary the Morgan Stanley Dean Witter Funds.
James P. Wallin
First Vice President
Robert Abreu
Vice President
Dale Albright
Vice President
Joan G. Allman
Vice President
Andrew Arbenz Vice President of Morgan Stanley Dean Witter Global
Vice President Utilities Fund.
Armon Bar-Tur Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
Maurice Bendrihem
Vice President and
Assistant Controller
Thomas A. Bergeron
Vice President
Philip Bernstein
Vice President
Dale Boettcher
Vice President
Michelina Calandrella
Vice President
Ronald Caldwell
Vice President
Joseph Cardwell
Vice President
10
<PAGE>
NAME AND POSITION WITH OTHER SUBSTANTIAL BUSINESS, PROFESSION, VOCATION
MORGAN STANLEY DEAN OR EMPLOYMENT, INCLUDING NAME, PRINCIPAL ADDRESS
WITTER ADVISORS INC. AND NATURE OF CONNECTION
- ----------------------- --------------------------------------------------
Liam Carroll
Vice President
Philip Casparius
Vice President
Annette Celenza
Vice President
Aaron Clark
Vice President
William Connerly
Vice President
Michael J. Davey
Vice President
David Dineen Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
Glen H. Frey Vice President of Morgan Stanley Dean Witter Information
Vice President Fund.
Jeffrey D. Geffen
Vice President
Sandra Gelpieryn
Vice President
Charmaine George
Vice President
Michael Geringer
Vice President
Gail Gerrity-Burke
Vice President
Peter Gewirtz
Vice President
Ellen Gold
Vice President
Stephen Greenhut
Vice President
11
<PAGE>
NAME AND POSITION WITH OTHER SUBSTANTIAL BUSINESS, PROFESSION, VOCATION
MORGAN STANLEY DEAN OR EMPLOYMENT, INCLUDING NAME, PRINCIPAL ADDRESS
WITTER ADVISORS INC. AND NATURE OF CONNECTION
- ----------------------- --------------------------------------------------
Trey Hancock
Vice President
Laury A. Haskamp
Vice President
Matthew T. Haynes Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
Peter Hermann Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
David T. Hoffman
Vice President
Thomas G. Hudson II
Vice President
Kevin Jung Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
Carol Espejo-Kane
Vice President
Nancy Karole-Kennedy
Vice President
Paula LaCosta Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
Kimberly LaHart
Vice President
Thomas Lawlor
Vice President
Gerard J. Lian Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
Cameron J. Livingstone
Vice President
Nancy Login
Vice President
Sharon Loguercio
Vice President
12
<PAGE>
NAME AND POSITION WITH OTHER SUBSTANTIAL BUSINESS, PROFESSION, VOCATION
MORGAN STANLEY DEAN OR EMPLOYMENT, INCLUDING NAME, PRINCIPAL ADDRESS
WITTER ADVISORS INC. AND NATURE OF CONNECTION
- ----------------------- --------------------------------------------------
Steven MacNamara
Vice President
Catherine Maniscalco Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
Peter R. McDowell
Vice President
Albert McGarity
Vice President
Teresa McRoberts Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
Mark Mitchell
Vice President
Julie Morrone Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
Mary Beth Mueller
Vice President
David Myers Vice President of Morgan Stanley Dean Witter Natural
Vice President Resource Development Securities Inc.
James Nash
Vice President
Richard Norris
Vice President
Hilary A. O'Neill
Vice President
Mori Paulson
Vice President
Anne Pickrell
Vice President
Frances Roman
Vice President
Dawn Rorke
Vice President
13
<PAGE>
NAME AND POSITION WITH OTHER SUBSTANTIAL BUSINESS, PROFESSION, VOCATION
MORGAN STANLEY DEAN OR EMPLOYMENT, INCLUDING NAME, PRINCIPAL ADDRESS
WITTER ADVISORS INC. AND NATURE OF CONNECTION
- ----------------------- --------------------------------------------------
John Roscoe Vice President of Morgan Stanley Dean Witter
Vice President Real Estate Fund.
Hugh Rose
Vice President
Robert Rossetti Vice President of Morgan Stanley Dean Witter Competitive
Vice President Edge Fund.
Sally Sancimino
Vice President
Deborah Santaniello
Vice President
Patrice Saunders
Vice President
Howard A. Schloss Vice President of Morgan Stanley Dean Witter Federal
Vice President Securities Trust.
Alison M. Sharkey
Vice President
Peter J. Seeley Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
Ronald B. Silvestri Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
Robert Stearns
Vice President
Naomi Stein
Vice President
William Stevens
Vice President
Michael Strayhorn
Vice President
Marybeth Swisher
Vice President
Michael Thayer
Vice President
14
<PAGE>
NAME AND POSITION WITH OTHER SUBSTANTIAL BUSINESS, PROFESSION, VOCATION
MORGAN STANLEY DEAN OR EMPLOYMENT, INCLUDING NAME, PRINCIPAL ADDRESS
WITTER ADVISORS INC. AND NATURE OF CONNECTION
- ----------------------- --------------------------------------------------
Robert Vanden Assem
Vice President
David Walsh
Vice President
Alice Weiss Vice President of various Morgan Stanley Dean Witter
Vice President Funds.
John Wong
Vice President
</TABLE>
The principal address of MSDW Advisors, MSDW Services, MSDW
Distributors, DWR, and the Morgan Stanley Dean Witter Funds is Two World Trade
Center, New York, New York 10048. The principal address of MSDW is 1585
Broadway, New York, New York 10036. The principal address of MSDW Trust is 2
Harborside Financial Center, Jersey City, New Jersey 07311.
Item 27. PRINCIPAL UNDERWRITERS
(a) Morgan Stanley Dean Witter Distributors Inc. ("MSDW Distributors"), a
Delaware corporation, is the principal underwriter of the Registrant. MSDW
Distributors is also the principal underwriter of the following investment
companies:
<TABLE>
<S> <C>
(1) Active Assets California Tax-Free Trust
(2) Active Assets Government Securities Trust
(3) Active Assets Institutional Money Trust
(4) Active Assets Money Trust
(5) Active Assets Premier Money Trust
(6) Active Assets Tax-Free Trust
(7) Morgan Stanley Dean Witter 21st Century Trend Fund
(8) Morgan Stanley Dean Witter Aggressive Equity Fund
(9) Morgan Stanley Dean Witter American Opportunities Fund
(10) Morgan Stanley Dean Witter Balanced Growth Fund
(11) Morgan Stanley Dean Witter Balanced Income Fund
(12) Morgan Stanley Dean Witter California Tax-Free Daily Income Trust
(13) Morgan Stanley Dean Witter California Tax-Free Income Fund
(14) Morgan Stanley Dean Witter Capital Growth Securities
(15) Morgan Stanley Dean Witter Competitive Edge Fund, "BEST IDEAS PORTFOLIO"
(16) Morgan Stanley Dean Witter Convertible Securities Trust
(17) Morgan Stanley Dean Witter Developing Growth Securities Trust
(18) Morgan Stanley Dean Witter Diversified Income Trust
(19) Morgan Stanley Dean Witter Dividend Growth Securities Inc.
(20) Morgan Stanley Dean Witter Equity Fund
(21) Morgan Stanley Dean Witter European Growth Fund Inc.
(22) Morgan Stanley Dean Witter Federal Securities Trust
(23) Morgan Stanley Dean Witter Financial Services Trust
15
<PAGE>
(24) Morgan Stanley Dean Witter Fund of Funds
(25) Morgan Stanley Dean Witter Global Dividend Growth Securities
(26) Morgan Stanley Dean Witter Global Utilities Fund
(27) Morgan Stanley Dean Witter Growth Fund
(28) Morgan Stanley Dean Witter Hawaii Municipal Trust
(29) Morgan Stanley Dean Witter Health Sciences Trust
(30) Morgan Stanley Dean Witter High Yield Securities Inc.
(31) Morgan Stanley Dean Witter Income Builder Fund
(32) Morgan Stanley Dean Witter Information Fund
(33) Morgan Stanley Dean Witter Intermediate Income Securities
(34) Morgan Stanley Dean Witter International Fund
(35) Morgan Stanley Dean Witter International SmallCap Fund
(36) Morgan Stanley Dean Witter Japan Fund
(37) Morgan Stanley Dean Witter Latin American Growth Fund
(38) Morgan Stanley Dean Witter Limited Term Municipal Trust
(39) Morgan Stanley Dean Witter Liquid Asset Fund Inc.
(40) Morgan Stanley Dean Witter Market Leader Trust
(41) Morgan Stanley Dean Witter Mid-Cap Dividend Growth Securities
(42) Morgan Stanley Dean Witter Mid-Cap Equity Trust
(43) Morgan Stanley Dean Witter Multi-State Municipal Series Trust
(44) Morgan Stanley Dean Witter Natural Resource Development Securities Inc.
(45) Morgan Stanley Dean Witter New York Municipal Money Market Trust
(46) Morgan Stanley Dean Witter New York Tax-Free Income Fund
(47) Morgan Stanley Dean Witter Next Generation Trust
(48) Morgan Stanley Dean Witter North American Government Income Trust
(49) Morgan Stanley Dean Witter Pacific Growth Fund Inc.
(50) Morgan Stanley Dean Witter Prime Income Trust
(51) Morgan Stanley Dean Witter Real Estate Fund
(52) Morgan Stanley Dean Witter S&P 500 Index Fund
(53) Morgan Stanley Dean Witter S&P 500 Select Fund
(54) Morgan Stanley Dean Witter Short-Term Bond Fund
(55) Morgan Stanley Dean Witter Short-Term U.S. Treasury Trust
(56) Morgan Stanley Dean Witter Small Cap Growth Fund
(57) Morgan Stanley Dean Witter Special Value Fund
(58) Morgan Stanley Dean Witter Strategist Fund
(59) Morgan Stanley Dean Witter Tax-Exempt Securities Trust
(60) Morgan Stanley Dean Witter Tax-Free Daily Income Trust
(61) Morgan Stanley Dean Witter Total Market Index Fund
(62) Morgan Stanley Dean Witter Total Return Trust
(63) Morgan Stanley Dean Witter U.S. Government Money Market Trust
(64) Morgan Stanley Dean Witter U.S. Government Securities Trust
(65) Morgan Stanley Dean Witter Utilities Fund
(66) Morgan Stanley Dean Witter Value-Added Market Series
(67) Morgan Stanley Dean Witter Value Fund
(68) Morgan Stanley Dean Witter Variable Investment Series
(69) Morgan Stanley Dean Witter World Wide Income Trust
</TABLE>
(b) The following information is given regarding directors and officers of MSDW
Distributors not listed in Item 26 above. The principal address of MSDW
Distributors is Two World Trade Center, New York, New York 10048. Other than Mr.
Purcell, who is a Trustee of the Registrant, none of the following persons has
any position or office with the Registrant.
16
<PAGE>
<TABLE>
<CAPTION>
NAME POSITIONS AND OFFICE WITH MSDW DISTRIBUTORS
<S> <C>
Michael T. Gregg Vice President and Assistant Secretary.
James F. Higgins Director
Philip J. Purcell Director
John Schaeffer Director
Charles Vadala Senior Vice President and Financial Principal.
</TABLE>
Item 28. LOCATION OF ACCOUNTS AND RECORDS
All accounts, books and other documents required to be maintained by
Section 31(a) of the Investment Company Act of 1940 and the Rules thereunder are
maintained by the Investment Manager at its offices, except records relating to
holders of shares issued by the Registrant, which are maintained by the
Registrant's Transfer Agent, at its place of business as shown in the
prospectus.
Item 29. MANAGEMENT SERVICES
Registrant is not a party to any such management-related service contract.
Item 30. NOT APPLICABLE
17
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all of
the requirements for effectiveness of this Registration Statement pursuant to
Rule 485(b) under the Securities Act of 1933 and has duly caused this
Post-Effective Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of New York
and State of New York on the 15th day of March, 2000.
MORGAN STANLEY DEAN WITTER
U.S. GOVERNMENT MONEY MARKET TRUST
By: /s/ Barry Fink
-------------------------------
Barry Fink
Vice President and Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment No. 21 has been signed below by the following persons
in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
<S> <C> <C>
(1) Principal Executive Officer Chairman, Chief Executive Officer
and Trustee
By: /s/ Charles A. Fiumefreddo 03/15/00
--------------------------------
Charles A. Fiumefreddo
(2) Principal Financial Officer Treasurer and Principal
Accounting Officer
By: /s/ Thomas F. Caloia 03/15/00
--------------------------------
Thomas F. Caloia
(3) Majority of the Trustees
Charles A. Fiumefreddo (Chairman)
Philip J. Purcell
By: /s/ Barry Fink 03/15/00
--------------------------------
Barry Fink
Attorney-in-Fact
Michael Bozic Manuel H. Johnson
Edwin J. Garn Michael E. Nugent
Wayne E. Hedien John L. Schroeder
By: /s/ David M. Butowsky 03/15/00
--------------------------------
David M. Butowsky
Attorney-in-Fact
</TABLE>
<PAGE>
MORGAN STANLEY DEAN WITTER
U.S. GOVERNMENT MONEY MARKET TRUST
EXHIBIT INDEX
2. Amended and Restated By-Laws of the Registrant, dated May 1, 1999.
9. Opinion of Latham, Watkins & Hills, dated February 8, 1982.
10. Consent of Independent Accountants.
16(a). Code of Ethics of Morgan Stanley Dean Witter Advisors Inc.,
Morgan Stanley Dean Witter Services Company Inc. and
Morgan Stanley Dean Witter Distributors Inc.
16(b). Code of Ethics of the Morgan Stanley Dean Witter Funds.
<PAGE>
BY-LAWS
OF
MORGAN STANLEY DEAN WITTER
U.S. GOVERNMENT MONEY MARKET TRUST
AMENDED AND RESTATED AS OF MAY 1, 1999
ARTICLE I
DEFINITIONS
The terms "COMMISSION," "DECLARATION," "DISTRIBUTOR," "INVESTMENT ADVISER,"
"MAJORITY SHAREHOLDER VOTE," "1940 ACT," "SHAREHOLDER," "SHARES," "TRANSFER
AGENT," "TRUST," "TRUST PROPERTY," and "TRUSTEES" have the respective meanings
given them in the Declaration of Trust of Morgan Stanley Dean Witter U.S.
Government Money Market Trust dated November 18, 1981, as amended from time to
time.
ARTICLE II
OFFICES
SECTION 2.1. PRINCIPAL OFFICE. Until changed by the Trustees, the
principal office of the Trust in the Commonwealth of Massachusetts shall be
in the City of Boston, County of Suffolk.
SECTION 2.2. OTHER OFFICES. In addition to its principal office in the
Commonwealth of Massachusetts, the Trust may have an office or offices in the
City of New York, State of New York, and at such other places within and without
the Commonwealth as the Trustees may from time to time designate or the business
of the Trust may require.
ARTICLE III
SHAREHOLDERS' MEETINGS
SECTION 3.1. PLACE OF MEETINGS. Meetings of Shareholders shall be held at
such place, within or without the Commonwealth of Massachusetts, as may be
designated from time to time by the Trustees.
SECTION 3.2. MEETINGS. Meetings of Shareholders of the Trust shall be held
whenever called by the Trustees or the President of the Trust and whenever
election of a Trustee or Trustees by Shareholders is required by the provisions
of Section 16(a) of the 1940 Act, for that purpose. Meetings of Shareholders
shall also be called by the Secretary upon the written request of the holders of
Shares entitled to vote not less than twenty-five percent (25%) of all the votes
entitled to be cast at such meeting. Such request shall state the purpose or
purposes of such meeting and the matters proposed to be acted on thereat. The
Secretary shall inform such Shareholders of the reasonable estimated cost of
preparing and mailing such notice of the meeting, and upon payment to the Trust
of such costs, the Secretary shall give notice stating the purpose or purposes
of the meeting to all entitled to vote at such meeting. No meeting need be
called upon the request of the holders of Shares entitled to cast less than a
majority of all votes entitled to be cast at such meeting, to consider any
matter which is substantially the same as a matter voted upon at any meeting of
Shareholders held during the preceding twelve months.
SECTION 3.3. NOTICE OF MEETINGS. Written or printed notice of every
Shareholders' meeting stating the place, date, and purpose or purposes thereof,
shall be given by the Secretary not less than ten (10) nor more than ninety (90)
days before such meeting to each Shareholder entitled to vote at such meeting.
Such notice shall be deemed to be given when deposited in the United States
mail, postage prepaid, directed to the Shareholder at his address as it appears
on the records of the Trust.
SECTION 3.4. QUORUM AND ADJOURNMENT OF MEETINGS. Except as otherwise provided
by law, by the Declaration or by these By-Laws, at all meetings of Shareholders,
the holders of a majority of the Shares issued and outstanding and entitled to
vote thereat, present in person or represented by proxy, shall be
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<PAGE>
requisite and shall constitute a quorum for the transaction of business. In the
absence of a quorum, the Shareholders present or represented by proxy and
entitled to vote thereat shall have the power to adjourn the meeting from time
to time. The Shareholders present in person or represented by proxy at any
meeting and entitled to vote thereat also shall have the power to adjourn the
meeting from time to time if the vote required to approve or reject any proposal
described in the original notice of such meeting is not obtained (with proxies
being voted for or against adjournment consistent with the votes for and against
the proposal for which the required vote has not been obtained). The affirmative
vote of the holders of a majority of the Shares then present in person or
represented by proxy shall be required to adjourn any meeting. Any adjourned
meeting may be reconvened without further notice or change in record date. At
any reconvened meeting at which a quorum shall be present, any business may be
transacted that might have been transacted at the meeting as originally called.
SECTION 3.5. VOTING RIGHTS, PROXIES. At each meeting of Shareholders, each
holder of record of Shares entitled to vote thereat shall be entitled to one
vote in person or by proxy for each Share of beneficial interest of the Trust
and for the fractional portion of one vote for each fractional Share entitled to
vote so registered in his or her name on the records of the Trust on the date
fixed as the record date for the determination of Shareholders entitled to vote
at such meeting. Without limiting the manner in which a Shareholder may
authorize another person or persons to act for such Shareholder as proxy
pursuant hereto, the following shall constitute a valid means by which a
Shareholder may grant such authority:
(i) A Shareholder may execute a writing authorizing another person or
persons to act for such Shareholder as proxy. Execution may be
accomplished by the Shareholder or such Shareholder's authorized officer,
director, employee, attorney-in-fact or another agent signing such
writing or causing such person's signature to be affixed to such writing
by any reasonable means including, but not limited to, by facsimile or
telecopy signature. No written evidence of authority of a Shareholder's
authorized officer, director, employee, attorney-in-fact or other agent
shall be required; and
(ii) A Shareholder may authorize another person or persons to act for
such Shareholder as proxy by transmitting or authorizing the transmission
of a telegram or cablegram or by other means of telephonic, electronic or
computer transmission to the person who will be the holder of the proxy
or to a proxy solicitation firm, proxy support service organization or
like agent duly authorized by the person who will be the holder of the
proxy to receive such transmission, provided that any such telegram or
cablegram or other means of telephonic, electronic or computer
transmission must either set forth or be submitted with information from
which it can be determined that the telegram, cablegram or other
transmission was authorized by the Shareholder.
No proxy shall be valid after eleven months from its date, unless otherwise
provided in the proxy. At all meetings of Shareholders, unless the voting is
conducted by inspectors, all questions relating to the qualification of voters
and the validity of proxies and the acceptance or rejection of votes shall be
decided by the chairman of the meeting. In determining whether a telegram,
cablegram or other electronic transmission is valid, the chairman or inspector,
as the case may be, shall specify the information upon which he or she relied.
Pursuant to a resolution of a majority of the Trustees, proxies may be solicited
in the name of one or more Trustees or Officers of the Trust. Proxy
solicitations may be made in writing or by using telephonic or other electronic
solicitation procedures that include appropriate methods of verifying the
identity of the Shareholder and confirming any instructions given thereby.
SECTION 3.6. VOTE REQUIRED. Except as otherwise provided by law, by the
Declaration of Trust, or by these By-Laws, at each meeting of Shareholders at
which a quorum is present, all matters shall be decided by Majority Shareholder
Vote.
SECTION 3.7. 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 of any meeting of Shareholders may, and on the request
of any Shareholder or his proxy shall, appoint Inspectors of Election of the
meeting. 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
2
<PAGE>
as chairman. The Inspectors of Election shall determine the number of Shares
outstanding, the Shares represented at the 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 the 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. On request of
the chairman 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 3.8. INSPECTION OF BOOKS AND RECORDS. Shareholders shall have such
rights and procedures of inspection of the books and records of the Trust as are
granted to Shareholders under Section 32 of the Business Corporation Law of the
Commonwealth of Massachusetts.
SECTION 3.9. ACTION BY SHAREHOLDERS WITHOUT MEETING. Except as otherwise
provided by law, the provisions of these By-Laws relating to notices and
meetings to the contrary notwithstanding, any action required or permitted to be
taken at any meeting of Shareholders may be taken without a meeting if a
majority of the Shareholders entitled to vote upon the action consent to the
action in writing and such consents are filed with the records of the Trust.
Such consent shall be treated for all purposes as a vote taken at a meeting of
Shareholders.
SECTION 3.10. PRESENCE AT MEETINGS. Presence at meetings of shareholders
requires physical attendance by the shareholder or his or her proxy at the
meeting site and does not encompass attendance by telephonic or other electronic
means.
ARTICLE IV
TRUSTEES
SECTION 4.1. MEETINGS OF THE TRUSTEES. The Trustees may in their discretion
provide for regular or special meetings of the Trustees. Regular meetings of the
Trustees may be held at such time and place as shall be determined from time to
time by the Trustees without further notice. Special meetings of the Trustees
may be called at any time by the President and shall be called by the President
or the Secretary upon the written request of any two (2) Trustees.
SECTION 4.2. NOTICE OF SPECIAL MEETINGS. Written notice of special meetings
of the Trustees, stating the place, date and time thereof, shall be given not
less than two (2) days before such meeting to each Trustee, personally, by
telegram, by mail, or by leaving such notice at his place of residence or usual
place of business. If mailed, such notice shall be deemed to be given when
deposited in the United States mail, postage prepaid, directed to the Trustee at
his address as it appears on the records of the Trust. Subject to the provisions
of the 1940 Act, notice or waiver of notice need not specify the purpose of any
special meeting.
SECTION 4.3. TELEPHONE MEETINGS. Subject to the provisions of the 1940 Act,
any Trustee, or any member or members of any committee designated by the
Trustees, may participate in a meeting of the Trustees, or any such committee,
as the case may be, by means of a conference telephone or similar communications
equipment if all persons participating in the meeting can hear each other at the
same time. Participation in a meeting by these means constitutes presence in
person at the meeting.
SECTION 4.4. QUORUM, VOTING AND ADJOURNMENT OF MEETINGS. At all meetings of
the Trustees, a majority of the Trustees shall be requisite to and shall
constitute a quorum for the transaction of business. If a quorum is present, the
affirmative vote of a majority of the Trustees present shall be the act of the
Trustees, unless the concurrence of a greater proportion is expressly required
for such action by law, the Declaration or these By-Laws. If at any meeting of
the Trustees there be less than a quorum present, the Trustees present thereat
may adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall have been obtained.
SECTION 4.5. ACTION BY TRUSTEES WITHOUT MEETING. The provisions of these
By-Laws covering notices and meetings to the contrary notwithstanding, and
except as required by law, any action required or permitted to be taken at any
meeting of the Trustees may be taken without a meeting if a consent in
3
<PAGE>
writing setting forth the action shall be signed by all of the Trustees entitled
to vote upon the action and such written consent is filed with the minutes of
proceedings of the Trustees.
SECTION 4.6. EXPENSES AND FEES. Each Trustee may be allowed expenses, if any,
for attendance at each regular or special meeting of the Trustees, and each
Trustee who is not an officer or employee of the Trust or of its investment
manager or underwriter or of any corporate affiliate of any of said persons
shall receive for services rendered as a Trustee of the Trust such compensation
as may be fixed by the Trustees. Nothing herein contained shall be construed to
preclude any Trustee from serving the Trust in any other capacity and receiving
compensation therefor.
SECTION 4.7. EXECUTION OF INSTRUMENTS AND DOCUMENTS AND SIGNING OF CHECKS AND
OTHER OBLIGATIONS AND TRANSFERS. All instruments, documents and other papers
shall be executed in the name and on behalf of the Trust and all checks, notes,
drafts and other obligations for the payment of money by the Trust shall be
signed, and all transfer of securities standing in the name of the Trust shall
be executed, by the Chairman, the President, any Vice President or the Treasurer
or by any one or more officers or agents of the Trust as shall be designated for
that purpose by vote of the Trustees; notwithstanding the above, nothing in this
Section 4.7 shall be deemed to preclude the electronic authorization, by
designated persons, of the Trust's Custodian (as described herein in Section
9.1) to transfer assets of the Trust, as provided for herein in Section 9.1.
SECTION 4.8. INDEMNIFICATION OF TRUSTEES, OFFICERS, EMPLOYEES AND AGENTS. (a)
The Trust shall indemnify any person 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, officer, employee, or agent of the Trust. 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 termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which 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 reasonable cause to
believe that his conduct was unlawful.
(b) The Trust shall indemnify any 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. 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
Trustee, officer, employee or agent 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.
(c) To the extent that a Trustee, officer, employee, or agent of the Trust
has been successful on the merits or otherwise in defense of any action, suit or
proceeding referred to in subsection (a) or (b) or in defense of any claim,
issue or matter therein, he shall be indemnified against expenses, including
attorneys' fees, actually and reasonably incurred by him in connection
therewith.
(d) (1) Unless a court orders otherwise, any indemnification under
subsections (a) or (b) of this section may be made by the Trust only as
authorized in the specific case after a determination that indemnification of
the Trustee, officer, employee, or agent is proper in the circumstances because
he has met the applicable standard of conduct set forth in subsections (a) or
(b).
4
<PAGE>
(2) The determination shall be made:
(i) By the Trustees, by a majority vote of a quorum which consists of
Trustees who were not parties to the action, suit or proceeding; or
(ii) If the required quorum is not obtainable, or if a quorum of
disinterested Trustees so directs, by independent legal counsel in a written
opinion; or
(iii) By the Shareholders.
(3) Notwithstanding any provision of this Section 4.8, no person shall be
entitled to indemnification for any liability, whether or not there is an
adjudication of liability, arising by reason of willful misfeasance, bad
faith, gross negligence, or reckless disregard of duties as described in
Section 17(h) and (i) of the Investment Company Act of 1940 ("disabling
conduct"). A person shall be deemed not liable by reason of disabling
conduct if, either:
(i) a final decision on the merits is made by a court or other body
before whom the proceeding was brought that the person to be indemnified
("indemnitee") was not liable by reason of disabling conduct; or
(ii) in the absence of such a decision, a reasonable determination, based
upon a review of the facts, that the indemnitee was not liable by reason of
disabling conduct, is made by either--
(A) a majority of a quorum of Trustees who are neither "interested
persons" of the Trust, as defined in Section 2(a)(19) of the Investment
Company Act of 1940, nor parties to the action, suit or proceeding, or
(B) an independent legal counsel in a written opinion.
(e) Expenses, including attorneys' fees, incurred by a Trustee, officer,
employee or agent of the Trust in defending a civil or criminal action, suit or
proceeding may be paid by the Trust in advance of the final disposition thereof
if:
(1) authorized in the specific case by the Trustees; and
(2) the Trust receives an undertaking by or on behalf of the Trustee,
officer, employee or agent of the Trust to repay the advance if it is not
ultimately determined that such person is entitled to be indemnified by the
Trust; and
(3) either, (i) such person provides a security for his undertaking, or
(ii) the Trust is insured against losses by reason of any lawful
advances, or
(iii) a determination, based on a review of readily available facts,
that there is reason to believe that such person ultimately will be
found entitled to indemnification, is made by either--
(A) a majority of a quorum which consists of Trustees who are
neither "interested persons" of the Trust, as defined in Section
2(a)(19) of the 1940 Act, nor parties to the action, suit or
proceeding, or
(B) an independent legal counsel in a written opinion.
(f) The indemnification provided by this Section shall not be deemed
exclusive of any other rights to which a person may be entitled under any
by-law, agreement, vote of Shareholders or disinterested Trustees or otherwise,
both as to action in his official capacity and as to action in another capacity
while holding the office, and shall continue as to a person who has ceased to be
a Trustee, officer, employee, or agent and inure to the benefit of the heirs,
executors and administrators of such person; provided that no person may satisfy
any right of indemnity or reimbursement granted herein or to which he may be
otherwise entitled except out of the property of the Trust, and no Shareholder
shall be personally liable with respect to any claim for indemnity or
reimbursement or otherwise.
5
<PAGE>
(g) The Trust may purchase and maintain insurance on behalf of any person who
is or was a Trustee, officer, employee, or agent of the Trust, against any
liability asserted against him and incurred by him in any such capacity, or
arising out of his status as such. However, in no event will the Trust purchase
insurance to indemnify any officer or Trustee against liability for any act for
which the Trust itself is not permitted to indemnify him.
(h) Nothing contained in this Section shall be construed to protect any
Trustee or officer of the Trust against any liability to the Trust or to its
security holders to which he would otherwise be subject by reason of willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of his office.
ARTICLE V
COMMITTEES
SECTION 5.1. EXECUTIVE AND OTHER COMMITTEES. The Trustees, by resolution
adopted by a majority of the Trustees, may designate an Executive Committee
and/or committees, each committee to consist of two (2) or more of the Trustees
of the Trust and may delegate to such committees, in the intervals between
meetings of the Trustees, any or all of the powers of the Trustees in the
management of the business and affairs of the Trust. In the absence of any
member of any such committee, the members thereof present at any meeting,
whether or not they constitute a quorum, may appoint a Trustee to act in place
of such absent member. Each such committee shall keep a record of its
proceedings.
The Executive Committee and any other committee shall fix its own rules or
procedure, but the presence of at least fifty percent (50%) of the members of
the whole committee shall in each case be necessary to constitute a quorum of
the committee and the affirmative vote of the majority of the members of the
committee present at the meeting shall be necessary to take action.
All actions of the Executive Committee shall be reported to the Trustees at
the meeting thereof next succeeding to the taking of such action.
SECTION 5.2. ADVISORY COMMITTEE. The Trustees may appoint an advisory
committee which shall be composed of persons who do not serve the Trust in any
other capacity and which shall have advisory functions with respect to the
investments of the Trust but which shall have no power to determine that any
security or other investment shall be purchased, sold or otherwise disposed of
by the Trust. The number of persons constituting any such advisory committee
shall be determined from time to time by the Trustees. The members of any such
advisory committee may receive compensation for their services and may be
allowed such fees and expenses for the attendance at meetings as the Trustees
may from time to time determine to be appropriate.
SECTION 5.3. COMMITTEE ACTION WITHOUT MEETING. The provisions of these
By-Laws covering notices and meetings to the contrary notwithstanding, and
except as required by law, any action required or permitted to be taken at any
meeting of any Committee of the Trustees appointed pursuant to Section 5.1 of
these By-Laws may be taken without a meeting if a consent in writing setting
forth the action shall be signed by all members of the Committee entitled to
vote upon the action and such written consent is filed with the records of the
proceedings of the Committee.
ARTICLE VI
OFFICERS
SECTION 6.1. EXECUTIVE OFFICERS. The executive officers of the Trust shall be
a Chairman, a President, one or more Vice Presidents, a Secretary and a
Treasurer. The Chairman shall be selected from among the Trustees but none of
the other executive officers need be a Trustee. Two or more offices, except
those of President and any Vice President, may be held by the same person, but
no officer shall execute, acknowledge or verify any instrument in more than one
capacity. The executive officers of the Trust shall be elected annually by the
Trustees and each executive officer so elected shall hold office until his or
her successor is elected and has qualified.
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<PAGE>
SECTION 6.2. OTHER OFFICERS AND AGENTS. The Trustees may also elect one or
more Assistant Vice Presidents, Assistant Secretaries and Assistant Treasurers
and may elect, or may delegate to the Chairman the power to appoint, such other
officers and agents as the Trustees shall at any time or from time to time deem
advisable.
SECTION 6.3. TERM AND REMOVAL AND VACANCIES. Each officer of the Trust shall
hold office until his or her successor is elected and has qualified. Any officer
or agent of the Trust may be removed by the Trustees whenever, in their
judgment, the best interests of the Trust will be served thereby, but such
removal shall be without prejudice to the contractual rights, if any, of the
person so removed.
SECTION 6.4. COMPENSATION OF OFFICERS. The compensation of officers and
agents of the Trust shall be fixed by the Trustees, or by the Chairman to the
extent provided by the Trustees with respect to officers appointed by the
Chairman.
SECTION 6.5. POWERS AND DUTIES. All officers and agents of the Trust, as
between themselves and the Trust, shall have such authority and perform such
duties in the management of the Trust as may be provided in or pursuant to these
By-Laws or, to the extent not so provided, as may be prescribed by the Trustees;
provided that no rights of any third party shall be affected or impaired by any
such By-Law or resolution of the Trustees unless such third party has knowledge
thereof.
SECTION 6.6. THE CHAIRMAN. The Chairman shall be the chief executive officer
of the Trust, shall preside at all meetings of the Shareholders and of the
Trustees, shall have general and active management of the business of the Trust,
shall see that all orders and resolutions of the Trustees are carried into
effect and, in connection therewith, shall be authorized to delegate to the
President or to one or more Vice Presidents such of his or her powers and duties
at such times and in such manner as he or she may deem advisable, shall be a
signatory on all Annual and Semi-Annual Reports as may be sent to Shareholders,
and shall perform such other duties as the Trustees may from time to time
prescribe.
SECTION 6.7. THE PRESIDENT. The President shall perform such duties as the
Trustees and the Chairman may from time to time prescribe and shall, in the
absence or disability of the Chairman, exercise the powers and perform the
duties of the Chairman. The President shall be authorized to delegate to one or
more Vice Presidents such of his or her powers and duties at such times and in
such manner as he or she may deem advisable.
SECTION 6.8. THE VICE PRESIDENTS. The Vice Presidents shall be of such number
and shall have such titles as may be determined from time to time by the
Trustees. The Vice President, or, if there shall be more than one, the Vice
Presidents in such order as may be determined from time to time by the Trustees
or the Chairman, shall, in the absence or disability of the President, exercise
the powers and perform the duties of the President, and shall perform such other
duties as the Trustees or the Chairman may from time to time prescribe.
SECTION 6.9. THE ASSISTANT VICE PRESIDENTS. The Assistant Vice President, or,
if there shall be more than one, the Assistant Vice Presidents in such order as
may be determined from time to time by the Trustees or the Chairman, shall
perform such duties and have such powers as may be assigned them from time to
time by the Trustees or the Chairman.
SECTION 6.10. THE SECRETARY. The Secretary shall attend all meetings of the
Trustees and all meetings of the Shareholders and record all the proceedings of
the meetings of the Shareholders and of the Trustees in a book to be kept for
that purpose, and shall perform like duties for the standing committees when
required. He or she shall give, or cause to be given, notice of all meetings of
the Shareholders and special meetings of the Trustees, and shall perform such
other duties and have such powers as the Trustees or the Chairman may from time
to time prescribe. He or she shall keep in safe custody the seal of the Trust
and affix or cause the same to be affixed to any instrument requiring it, and,
when so affixed, it shall be attested by his or her signature or by the
signature of an Assistant Secretary.
SECTION 6.11. THE ASSISTANT SECRETARIES. The Assistant Secretary, or, if
there shall be more than one, the Assistant Secretaries in such order as may be
determined from time to time by the Trustees or the Chairman, shall, in the
absence or disability of the Secretary, perform the duties and exercise the
powers of the Secretary and shall perform such duties and have such other powers
as the Trustees or the Chairman may from time to time prescribe.
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SECTION 6.12. THE TREASURER. The Treasurer shall be the chief financial
officer of the Trust. He or she shall keep or cause to be kept full and accurate
accounts of receipts and disbursements in books belonging to the Trust, and he
or she shall render to the Trustees and the Chairman, whenever any of them
require it, an account of his or her transactions as Treasurer and of the
financial condition of the Trust, and he or she shall perform such other duties
as the Trustees or the Chairman may from time to time prescribe.
SECTION 6.13. THE ASSISTANT TREASURERS. The Assistant Treasurer, or, if there
shall be more than one, the Assistant Treasurers in such order as may be
determined from time to time by the Trustees or the Chairman, shall, in the
absence or disability of the Treasurer, perform the duties and exercise the
powers of the Treasurer and shall perform such other duties and have such other
powers as the Trustees or the Chairman may from time to time prescribe.
SECTION 6.14. DELEGATION OF DUTIES. Whenever an officer is absent or
disabled, or whenever for any reason the Trustees may deem it desirable, the
Trustees may delegate the powers and duties of an officer or officers to any
other officer or officers or to any Trustee or Trustees.
ARTICLE VII
DIVIDENDS AND DISTRIBUTIONS
Subject to any applicable provisions of law and the Declaration, dividends
and distributions upon the Shares may be declared at such intervals as the
Trustees may determine, in cash, in securities or other property, or in Shares,
from any sources permitted by law, all as the Trustees shall from time to time
determine.
Inasmuch as the computation of net income and net profits from the sales of
securities or other properties for federal income tax purposes may vary from the
computation thereof on the records of the Trust, the Trustees shall have power,
in their discretion, to distribute as income dividends and as capital gain
distributions, respectively, amounts sufficient to enable the Trust to avoid or
reduce liability for federal income taxes.
ARTICLE VIII
CERTIFICATES OF SHARES
SECTION 8.1. CERTIFICATES OF SHARES. Certificates for Shares of each series
or class of Shares shall be in such form and of such design as the Trustees
shall approve, subject to the right of the Trustees to change such form and
design at any time or from time to time, and shall be entered in the records of
the Trust as they are issued. Each such certificate shall bear a distinguishing
number; shall exhibit the holder's name and certify the number of full Shares
owned by such holder; shall be signed by or in the name of the Trust by the
President, or a Vice President, and countersigned by the Secretary or an
Assistant Secretary or the Treasurer and an Assistant Treasurer of the Trust;
shall be sealed with the seal; and shall contain such recitals as may be
required by law. Where any certificate is signed by a Transfer Agent or by a
Registrar, the signature of such officers and the seal may be facsimile, printed
or engraved. The Trust may, at its option, determine not to issue a certificate
or certificates to evidence Shares owned of record by any Shareholder.
In case any officer or officers who shall have signed, or whose facsimile
signature or signatures shall appear on, any such certificate or certificates
shall cease to be such officer or officers of the Trust, whether because of
death, resignation or otherwise, before such certificate or certificates shall
have been delivered by the Trust, such certificate or certificates shall,
nevertheless, be adopted by the Trust and be issued and delivered as though the
person or persons who signed such certificate or certificates or whose facsimile
signature or signatures shall appear therein had not ceased to be such officer
or officers of the Trust.
No certificate shall be issued for any share until such share is fully paid.
SECTION 8.2. LOST, STOLEN, DESTROYED AND MUTILATED CERTIFICATES. The
Trustees may direct a new certificate or certificates to be issued in place
of any certificate or certificates theretofore issued by the
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<PAGE>
Trust alleged to have been lost, stolen or destroyed, upon satisfactory proof of
such loss, theft, or destruction; and the Trustees may, in their discretion,
require the owner of the lost, stolen or destroyed certificate, or his legal
representative, to give to the Trust and to such Registrar, Transfer Agent
and/or Transfer Clerk as may be authorized or required to countersign such new
certificate or certificates, a bond in such sum and of such type as they may
direct, and with such surety or sureties, as they may direct, as indemnity
against any claim that may be against them or any of them on account of or in
connection with the alleged loss, theft or destruction of any such certificate.
ARTICLE IX
CUSTODIAN
SECTION 9.1. APPOINTMENT AND DUTIES. The Trust shall at times employ a bank
or trust company having capital, surplus and undivided profits of at least five
million dollars ($5,000,000) as custodian with authority as its agent, but
subject to such restrictions, limitations and other requirements, if any, as may
be contained in these By-Laws and the 1940 Act:
(1) to receive and hold the securities owned by the Trust and deliver the
same upon written or electronically transmitted order;
(2) to receive and receipt for any moneys due to the Trust and deposit the
same in its own banking department or elsewhere as the Trustees may direct;
(3) to disburse such funds upon orders or vouchers;
all upon such basis of compensation as may be agreed upon between the Trustees
and the custodian. If so directed by a Majority Shareholder Vote, the custodian
shall deliver and pay over all property of the Trust held by it as specified in
such vote.
The Trustees may also authorize the 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 sub-custodian shall be a bank or trust company organized under
the laws of the United States or one of the states thereof and having capital,
surplus and undivided profits of at least five million dollars ($5,000,000).
SECTION 9.2. CENTRAL CERTIFICATE SYSTEM. Subject to such rules, regulations
and orders as the Commission may adopt, the Trustees may direct the custodian to
deposit all or any part of the securities owned by the Trust in a system for the
central handling of securities established by a national securities exchange or
a national securities association registered with the Commission under the
Securities Exchange Act of 1934, or such other person as may be permitted by the
Commission, or otherwise in accordance with the 1940 Act, pursuant to which
system all securities of any particular class or series of any issuer deposited
within the system are treated as fungible and may be transferred or pledged by
bookkeeping entry without physical delivery of such securities, provided that
all such deposits shall be subject to withdrawal only upon the order of the
Trust.
ARTICLE X
WAIVER OF NOTICE
Whenever any notice of the time, place or purpose of any meeting of
Shareholders, Trustees, or of any committee is required to be given in
accordance with law or under the provisions of the Declaration or these By-Laws,
a waiver thereof in writing, signed by the person or persons entitled to such
notice and filed with the records of the meeting, whether before or after the
holding thereof, or actual attendance at the meeting of shareholders, Trustees
or committee, as the case may be, in person, shall be deemed equivalent to the
giving of such notice to such person.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. LOCATION OF BOOKS AND RECORDS. The books and records of the
Trust may be kept outside the Commonwealth of Massachusetts at such place or
places as the Trustees may from time to time determine, except as otherwise
required by law.
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<PAGE>
SECTION 11.2. RECORD DATE. The Trustees may fix in advance a date as the
record date for the purpose of determining the Shareholders entitled to (i)
receive notice of, or to vote at, any meeting of Shareholders, or (ii) receive
payment of any dividend or the allotment of any rights, or in order to make a
determination of Shareholders for any other proper purpose. The record date, in
any case, shall not be more than one hundred eighty (180) days, and in the case
of a meeting of Shareholders not less than ten (10) days, prior to the date on
which such meeting is to be held or the date on which such other particular
action requiring determination of Shareholders is to be taken, as the case may
be. In the case of a meeting of Shareholders, the meeting date set forth in the
notice to Shareholders accompanying the proxy statement shall be the date used
for purposes of calculating the 180 day or 10 day period, and any adjourned
meeting may be reconvened without a change in record date. In lieu of fixing a
record date, the Trustees may provide that the transfer books shall be closed
for a stated period but not to exceed, in any case, twenty (20) days. If the
transfer books are closed for the purpose of determining Shareholders entitled
to notice of a vote at a meeting of Shareholders, such books shall be closed for
at least ten (10) days immediately preceding the meeting.
SECTION 11.3. SEAL. The Trustees shall adopt a seal, which shall be in such
form and shall have such inscription thereon as the Trustees may from time to
time provide. The seal of the Trust may be affixed to any document, 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 attested
manually in the same manner and with the same effect as if done by a
Massachusetts business corporation under Massachusetts law.
SECTION 11.4. FISCAL YEAR. The fiscal year of the Trust shall end on such
date as the Trustees may by resolution specify, and the Trustees may by
resolution change such date for future fiscal years at any time and from time to
time.
SECTION 11.5. ORDERS FOR PAYMENT OF MONEY. All orders or instructions for the
payment of money of the Trust, and all notes or other evidences of indebtedness
issued in the name of the Trust, shall be signed by such officer or officers or
such other person or persons as the Trustees may from time to time designate, or
as may be specified in or pursuant to the agreement between the Trust and the
bank or trust company appointed as Custodian of the securities and funds of the
Trust.
ARTICLE XII
COMPLIANCE WITH FEDERAL REGULATIONS
The Trustees are hereby empowered to take such action as they may deem to be
necessary, desirable or appropriate so that the Trust is or shall be in
compliance with any federal or state statute, rule or regulation with which
compliance by the Trust is required.
ARTICLE XIII
AMENDMENTS
These By-Laws may be amended, altered, or repealed, or new By-Laws may be
adopted, (a) by a Majority Shareholder Vote, or (b) by the Trustees; provided,
however, that no By-Law may be amended, adopted or repealed by the Trustees if
such amendment, adoption or repeal requires, pursuant to law, the Declaration,
or these By-Laws, a vote of the Shareholders. 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.
ARTICLE XIV
DECLARATION OF TRUST
The Declaration of Trust establishing Morgan Stanley Dean Witter U.S.
Government Money Market Trust, dated November 18, 1981, 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 Morgan Stanley
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Dean Witter U.S. Government Money Market 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 Morgan Stanley Dean
Witter U.S. Government Money Market 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 Morgan Stanley Dean Witter U.S. Government Money Market Trust,
but the Trust Estate only shall be liable.
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<TABLE>
<S><C>
LATHAM, WATKINS & HILLS
ATTORNEYS AT LAW
PAUL R. WATKINS (1899-1973) 1333 NEW HAMPSHIRE AVENUE, N.W. NEWPORT BEACH OFFICE
DANA LATHAM (1898-1974) SUITE 1200 --------------------
-------- WASHINGTON, D.C. 20036 660 NEWPORT CENTER DRIVE, SUITE 1400
LOS ANGELES OFFICE TELEPHONE (202) 828-4400 NEWPORT BEACH, CALIFORNIA 92660
------------------ TELECOPIER (202) 828-4415 TELEPHONE (714) 752-9100
555 SOUTH FLOWER STREET TWX 710 822-9375 TELECOPIER (714) 759-8891
LOS ANGELES, CALIFORNIA 90071
TELEPHONE (213) 485-1234 SAN DIEGO OFFICE
CABLE ADDRESS LATHWAT ----------------
TWX 910 321-3733 225 BROADWAY, SUITE 2200
TELECOPIER (213) 680-2098 SAN DIEGO, CALIFORNIA 92101
TELEPHONE (714) 239-4414
TELECOPIER (714) 239-3624
</TABLE>
February 8, 1982
Sears U.S. Government Money
Market Trust
5 World Trade Center
New York, New York 10048
Re: REGISTRATION STATEMENT ON FORM N-1
Gentlemen:
At your request we have examined the Registration Statement on Form
N-1 (the "Registration Statement") which you have filed with the Securities and
Exchange Commission in connection with the registration under the Securities Act
of 1933, as amended, of an unlimited number of Shares of Beneficial Interest
(the "Shares") of the Sears U.S. Government Money Market Trust (the "Trust"). We
are familiar with the proceedings taken by you in connection with the
authorization, issuance and sale of the Shares. Additionally, we have examined
such documents and such questions of law and fact as we have considered
necessary or appropriate for purposes of this opinion. As to matters of
Massachusetts law, we have relied upon the opinion of Gaston Snow & Ely
Bartlett.
Based upon the foregoing, we are of the opinion that, subject to the
proceedings contemplated above being duly taken and completed by you, upon the
effective date of the Registration Statement, the Shares to be issued by you
pursuant to the Registration Statement, when issued from time to time in
accordance with the Trust's Declaration of Trust, will be legally and validly
issued, fully paid and nonassessable by the Trust.
We consent to your filing this opinion as an exhibit to the
Registration Statement and to the reference to our firm in the prospectus
included therein.
Very truly yours,
/s/ Latham, Watkins, & Hills
LATHAM, WATKINS & HILLS
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the use in this Registration Statement on Form N-1A of
our report dated March 7, 2000, relating to the financial statements and
financial highlights of Morgan Stanley Dean Witter U.S. Government Money
Market Trust, which appears in such Registration Statement. We also consent
to the references to us under the headings "Custodian and Independent
Accountants," "Experts" and "Financial Highlights" in such Registration
Statement.
/s/ PricewaterhouseCoopers LLP
- ------------------------------
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, New York 10036
March 16, 2000
<PAGE>
CODE OF ETHICS
- ------------------------
(Print Name)
MORGAN STANLEY DEAN WITTER ADVISORS INC.
MORGAN STANLEY DEAN WITTER SERVICES COMPANY INC.
MORGAN STANLEY DEAN WITTER DISTRIBUTORS INC.
Effective September 1, 1994 (as amended through March 1, 2000)
I. INTRODUCTION
Morgan Stanley Dean Witter Advisors Inc. ("MSDW Advisors"), a subsidiary of
Morgan Stanley Dean Witter & Co., is an investment adviser or manager of a
group of investment companies, referred to herein as the "Morgan Stanley
Dean Witter Funds." MSDW Advisors also serves as investment adviser to other
clients, including corporate pension funds, other institutions and
individuals ("MSDW Advisors Managed Accounts").
This Code of Ethics is adopted by MSDW Advisors in keeping with the general
principles and objectives set forth in Sections II and III below, and to
enforce the highest legal and ethical standards in light of its fiduciary
obligations to the Morgan Stanley Dean Witter Fund shareholders and to MSDW
Advisors' other clients. It has also been adopted by Morgan Stanley Dean
Witter Services Company Inc. ("Services"), a wholly owned subsidiary of MSDW
Advisors, and by Morgan Stanley Dean Witter Distributors Inc.
("Distributors"), a wholly-owned subsidiary of Morgan Stanley Dean Witter &
Co.), to apply to their Directors, officers and employees.
Employees, officers and Directors of MSDW Advisors, Services and
Distributors are also referred to the Morgan Stanley Dean Witter Policy
Statement on Insider Trading (attached), which is incorporated in this Code.
II. GENERAL PRINCIPLES
A. SHAREHOLDER AND CLIENT INTERESTS COME FIRST
Every officer, director or employee of MSDW Advisors, Services and
Distributors owes a fiduciary duty to the shareholders of the Morgan
Stanley Dean Witter Funds and to all other clients of MSDW Advisors. This
means that in every decision relating to investments, employees and
affiliates must recognize the needs and interests of the Morgan Stanley
Dean Witter Fund shareholders and other MSDW Advisors clients, and be
certain that at all times the interests of the shareholders and other
clients are placed ahead of any personal interest.
B. AVOID ACTUAL AND POTENTIAL CONFLICTS OF INTEREST
The restrictions and requirements of this Code of Ethics are designed to
prevent behavior which conflicts, potentially conflicts or raises the
appearance of actual or potential conflict with the interests of the
shareholders of the Morgan Stanley Dean Witter Funds and MSDW Advisors
Managed Account clients. It is of the utmost importance that the
personal securities transactions of employees and affiliates be
conducted in a manner consistent with both the letter and spirit of this
Code of Ethics, including these principles. Only then can an individual,
and MSDW Advisors, Services and Distributors as a whole, be certain to
avoid any actual or potential conflict of interest or any abuse of an
individual's position of trust and responsibility.
<PAGE>
C. AVOID UNDUE PERSONAL BENEFIT
MSDW Advisors, Services and Distributors employees and affiliates should
ensure that they do not acquire undue personal benefit or advantage as a
result of the performance of their normal duties as they relate to the
Morgan Stanley Dean Witter Funds and other MSDW Advisors clients.
Consistent with the first principle that the interests of the Morgan
Stanley Dean Witter Fund shareholders and other MSDW Advisors clients
must always come first is the fundamental standard that undue personal
advantage deriving from the management by MSDW Advisors of other
people's money is to be avoided.
III. OBJECTIVE
The Securities and Exchange Commission's code of ethics rule contained in
the Investment Company Act of 1940 makes it unlawful for certain persons
associated with investment advisers or principal underwriters of 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 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
maintain the behavior of certain individuals associated with MSDW Advisors,
Services and Distributors (herein called "Access Persons") within the
general principles set forth above, as well as to prevent such persons from
engaging in conduct proscribed by the code of ethics rule and Section 204A
of the Investment Advisers Act. The Compliance Officer or Compliance
Coordinator in MSDW Advisors Risk Management Department will identify all
Access Persons and notify them of their reporting obligations at the time
they become an Access Person. Access Persons include all directors,
officers and employees of MSDW Advisors, Services or Distributors except
those directors and officers of Distributors who meet the following three
criteria: (i) they do not devote substantially all working time to the
activities of MSDW Advisors, Services or Distributors; (ii) they do not, in
connection with their regular functions and duties, participate in, obtain
information with respect to, or make recommendations as to, the purchase
and sale of securities; and (iii) they do not have access to information
regarding the day-to-day investment activities of MSDW Advisors, Services
or Distributors (those Directors and officers must, however, file quarterly
transaction reports pursuant to Section V., sub-section D., below). An
Officer or employee of MSDW Advisors, Distributors or Services on leave is
not considered an Access Person hereunder, provided that during the period
such person is on leave, subparagraphs (ii) and (iii) in the preceding
sentence are applicable.
IV. GROUNDS FOR DISQUALIFICATION FROM EMPLOYMENT
Pursuant to the terms of Section 9 of the Investment Company Act of 1940, no
director, officer or employee of MSDW Advisors, Services or Distributors may
become, or continue to remain, an officer, director or employee, without an
exemptive order issued by the Securities and Exchange Commission, if such
director, officer or employee is, or becomes:
A. within the past ten years convicted of any felony or misdemeanor
involving the purchase or sale of any security or arising out of the
officer's or employee's conduct 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
B. permanently or temporarily enjoined by any court from acting 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 from 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.
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It is your obligation to immediately report any conviction or injunction to
the General Counsel of MSDW Advisors.
V. PERSONAL TRANSACTIONS IN SECURITIES
A. PROHIBITED CONDUCT
No Access Person shall buy or sell any security for his own account or
for an account in which he has, or as a result of the transaction
acquires, any direct or indirect beneficial ownership (referred to herein
as a "personal transaction") unless:
1. advance clearance of the transaction has been obtained; and
2. the transaction is reported in writing to MSDW Advisors in accordance
with the requirements of sub-section D below.
B. RESTRICTIONS AND LIMITATIONS ON PERSONAL SECURITIES TRANSACTIONS
The following restrictions and limitations govern investments and
personal securities transactions by Access Persons. Unless otherwise
indicated, all restrictions and limitations are applicable to all Access
Persons:
1. Securities purchased may not be sold at a profit until at least 60
days from the purchase trade date. In addition, securities sold may
not be purchased at a lower price until at least 60 days from the
sale trade date. Any violation will result in disgorgement of all
profits from the transactions.
2. No short sales are permitted.
3. No transactions in options or futures are permitted.
4. No Access Person may acquire any security in an Initial Public
Offering (IPO).
5a. Private placements of any kind may only be acquired with special
permission of the Code of Ethics Review Committee, and, if approved,
will be subject to continuous monitoring for possible future
conflict. Any Access Person wishing to request approval for private
placements must complete an MSDW Advisors Private Placement Approval
Request Form and submit the form to MSDW Advisors' Risk Management
Department. A copy of MSDW Advisors Private Placement Approval
Request Form, which may be revised at any time, is attached as
Exhibit A. Where the Code of Ethics Review Committee approves any
acquisition of private placements, its decision and reasons for
supporting the decision will be documented in a written report, which
is to be kept for five years in MSDW Advisors' Risk Management
Department after the end of the fiscal year in which the approval was
granted.
5b. Any Access Person who has a personal position in an issuer through a
private placement must affirmatively disclose that interest if such
Access Person is involved in consideration of any subsequent
investment decision regarding any security of that issuer or an
affiliate by any Morgan Stanley Dean Witter Fund or MSDW Advisors
Managed Account. In such event, the final investment decision shall
be independently reviewed by MSDW Advisor's Chief Investment Officer.
Written records of any such circumstance shall be maintained and sent
to the MSDW Advisors' Risk Management Department.
6. Access Persons with MSDW Online accounts are permitted to trade ONLY
between the hours of 9:30 a.m. and 4:00 p.m. (New York time). Trading
after hours is prohibited.
THE FOLLOWING RESTRICTIONS, 7a, 7b AND 7c, APPLY ONLY TO (I) PORTFOLIO
MANAGERS (AND ALL PERSONS REPORTING TO PORTFOLIO MANAGERS) AND
(II) PERSONNEL IN THE MSDW ADVISORS TRADING DEPARTMENT.
3
<PAGE>
7a. No purchase or sale transactions may be made in any security by any
portfolio manager (or person reporting to a portfolio manager) for a
period of thirty (30) days before or after that security is bought or
sold by any Morgan Stanley Dean Witter Fund (other than Morgan
Stanley Dean Witter Value-Added Market Series, Morgan Stanley Dean
Witter Select Dimensions Investment Series--Value-Added Portfolio,
Morgan Stanley Dean Witter Index Funds, or Portfolios) or MSDW
Advisors Managed Account for which such portfolio manager (or the
portfolio manager to whom such person reports) serves in that
capacity.
7b. No purchase or sale transactions may be made in any security traded
through the MSDW Advisors trading department by any person employed
in the MSDW Advisors trading department for a period of thirty (30)
days before or after that security is bought or sold by any Morgan
Stanley Dean Witter Fund (other than Morgan Stanley Dean Witter
Value-Added Market Series, Morgan Stanley Dean Witter Select
Dimensions Investment Series--Value-Added Portfolio, Morgan Stanley
Dean Witter Index Funds, or Portfolios) or MSDW Advisors Managed
Account.
7c. Any transactions by persons described in (a) and (b) above within
such enumerated period will 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 individual security transaction and the subsequent purchase or
sale price by a relevant MSDW Fund during the enumerated period, will
be subject to disgorgement.
IMPORTANT: Regardless of the limited applicability of Restriction 7,
MSDW Advisors' Risk Management Department monitors all transactions
by ALL Access Persons in order to ascertain any pattern of conduct
which may evidence conflicts or potential conflicts with the
principles and objectives of this Code, including a pattern of
frontrunning. On a quarterly basis, MSDW Advisors' Risk Management
Department will provide the MSDW Funds Boards of Directors with a
written report that (i) describes issues that arose during the
previous quarter under this Code and if applicable, each MSDW Funds'
Sub-Adviser's Code, including but not limited to, information about
material violations and sanctions imposed in response to the material
violations, and (ii) certifies that MSDW Advisors has adopted
procedures reasonably necessary to prevent Access Persons from
violating this Code.
C. ADVANCE CLEARANCE REQUIREMENT
1. PROCEDURES
(a) FROM WHOM OBTAINED
Subject to the limitations and restrictions of B above, advance
clearance of a personal transaction in a security must be
obtained from any two of the following officers of MSDW Advisors:
(1) CEO/President
(2) Chief Investment Officer
(3) Chief Administrative Officer
(4) General Counsel
(5) any other person so designated by the CEO or President,
provided, however, that no more than ten persons, at any
time, may be Clearing Officers.
These officers are referred to in this Code as "Clearing
Officers."
4
<PAGE>
Prior to obtaining the two signatures from the Clearing Officers,
the form must be approved by the MSDW Advisors Department
responsible for the type of security for which permission is
being sought, as follows:
<TABLE>
<S> <C>
1. Equity Trading --Equity Trading Department
2. Fixed-Income Corporate --Manager,Corporate Fixed-Income
Bonds
3. Municipal Bonds --Manager, Municipal Fixed-Income
4. Non-Investment Grade --Manager, High Yield Fixed-Income
("Junk") Bonds
5. Collateralized Mortgage --Manager, Government Fixed-Income
Obligations (CMOs) and
other non-exempt Mortgage
and Asset-Backed Securities
6. Convertible Securities --Manager, Convertible Securities
</TABLE>
Prior to obtaining the Clearing Officers' signatures the form
also must be reviewed and initialed by the MSDW Advisors' Risk
Management Department. A copy of MSDW Advisors Securities
Transaction Approval Form, which may be revised at any time, is
attached as Exhibit B.
The Clearing Officers will not sign unless the approvals of the
relevant investment department and MSDW Advisors' Risk Management
Department are indicated on the form. MSDW Advisors' Risk
Management Department has implemented procedures reasonably
designed to monitor purchases and sales effected pursuant to the
aforementioned pre-clearance procedures.
(b) TIME OF CLEARANCE
All approved securities transactions, whether executed through A
MSDW BROKERAGE ACCOUNT OR AN MSDW ONLINE ACCOUNT, must take
place, prior to 4:00 p.m. EST, on the same day that the complete
advance clearance is obtained. If the transaction is not
completed on the date of clearance, a new clearance must be
obtained, including one for any uncompleted portion.
Post-approval is NOT PERMITTED under the Code of Ethics. If it is
determined that a trade was completed before approval, it will be
considered a violation of the Code of Ethics.
(c) PERMITTED BROKERAGE ACCOUNTS
ALL SECURITIES TRANSACTIONS MUST BE THROUGH AN MSDW BROKERAGE
ACCOUNT OR AN MSDW ONLINE ACCOUNT; NO OTHER BROKERAGE ACCOUNTS
ARE PERMITTED UNLESS SPECIAL PERMISSION IS OBTAINED. If you
maintain accounts outside of MSDW, you must immediately transfer
your accounts to a MSDW branch. Failure to do so will be
considered a significant violation of the Code of Ethics. In the
event permission is granted to maintain an outside brokerage
account, it is the responsibility of the employee to arrange for
duplicate confirmations of all securities transactions and
monthly brokerage statements to be sent to the MSDW Advisors'
Risk Management Department.
Prior to opening an MSDW ONLINE ACCOUNT, Access Persons must
obtain approval from MSDW Advisors' Risk Management Department.
NO employee may open an MSDW Online account unless a completed
and signed copy of their MSDW Online account application and MSDW
Employee Account Request Form is submitted to MSDW Advisors' Risk
Management Department for approval. NO employee may apply for an
MSDW ONLINE ACCOUNT ONLINE. A copy of the MSDW Employee Account
Request Form, which may be revised at any time, is attached as
Exhibit C.
5
<PAGE>
(d) FORM
Clearance must be obtained by completing and signing the
Securities Transaction Approval Form provided for that purpose by
MSDW Advisors and obtaining the signature of the correct
Department indicated in sub-section C.1 (a) and any two of the
Clearing Officers. The form must also indicate the name of the
individual's Financial Advisor and the Branch Office Number,
whether the account is an MSDW Online Account, as well as other
required information.
If you have more than one account under your control, indicate on
the approval sheet for which account the trade is intended.
ADDITIONALLY, PLEASE ADVISE YOUR FINANCIAL ADVISOR OR MSDW ONLINE
TO SEND DUPLICATE COPIES OF YOUR CONFIRMATION SLIPS AND BROKER
STATEMENTS TO THE MSDW Advisors' Risk Management Department FOR
EACH ACCOUNT UNDER YOUR CONTROL.
(e) FILING
After all required signatures are obtained, the Securities
Transaction Approval Form must be filed with the Risk Management
Department of MSDW Advisors by noon of the day following
execution of the trade for filing in the respective individual's
Code of Ethics file. A copy is retained by the employee for his
or her records. (If a preclearance request is denied, a copy of
the form will be maintained with MSDW Advisors' Risk Management
Department.)
2. FACTORS CONSIDERED IN CLEARANCE OF PERSONAL TRANSACTIONS
In addition to the limitations and restrictions set forth under B
above, the Clearing Officers, in keeping with the general principles
and objectives of this Code of Ethics, may refuse to grant clearance
of a personal transaction in their sole discretion without being
required to specify any reason for the refusal. Generally, the
Clearing Officers will consider the following factors in determining
whether or not to clear a proposed transaction:
(a) Whether the amount or the nature of the transaction or person
making it is likely to affect the price or market of the
security.
(b) 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 Morgan Stanley Dean Witter Fund or
client.
(c) Whether the transaction is non-volitional on the part of the
individual.
3. EXEMPT SECURITIES
(a) The securities listed below are exempt from the restrictions of
sub-sections (B) (1) and (7), the advance clearance requirement
of sub-section C AND the quarterly and annual reporting
requirements of sub-section D. Therefore, it is not necessary to
obtain advance clearance for personal transactions in any of the
following securities nor is it necessary to report such
securities in the quarterly transaction reports or annual
securities holdings list:
(i) U.S. Government Securities;
(ii) Bank Certificates of Deposit;
(iii) Bankers' Acceptances;
(iv) Commercial Paper;
6
<PAGE>
(v) Purchases which are part of an automatic dividend
reinvestment plan (All employees with dividend reinvestment
plans must submit a memorandum to MSDW Advisors' Risk
Management Department and sales must be pre-approved); and
(vi) Open-end investment companies (mutual funds) (Closed-end
funds must be pre-approved).
(b) In addition, the following securities are exempt from the
restrictions of sub-sections B (1) and (7) and the advance
clearance requirement of sub-section C, but are subject to the
quarterly and annual reporting requirements of sub-section D:
(i) Unit Investment Trusts; and
(ii) Morgan Stanley Dean Witter & Co. stock (including exercise
of stock option grants), due to the fact that it may not be
purchased by any actively managed Morgan Stanley Dean Witter
Fund (other than index-type funds) or for any MSDW Advisors
Managed Account. The restrictions imposed by Morgan Stanley
Dean Witter & Co. on Senior Management and other persons in
connection with transactions in Morgan Stanley Dean Witter &
Co. stock are not affected by the exemption of Morgan Stanley
Dean Witter & Co. stock from the advance clearance
requirements of this Code, and continue in effect to the
extent applicable.
4. ACCOUNTS COVERED
Advance clearance must be obtained for any personal transaction in a
security by an Access Person if such Access Person has, or as a
result of the transaction acquires, any direct or indirect beneficial
ownership in the security.
The term "beneficial ownership" is defined by rules of the SEC which
will be applicable in all cases. Generally, under the SEC rules, a
person is regarded as having beneficial ownership of securities held
in the name of:
(a) a husband, wife or a minor child; OR
(b) a relative sharing the same house; OR
(c) anyone else if the Access Person:
(i) obtains benefits substantially equivalent to ownership of the
securities; or
(ii) can obtain ownership of the securities immediately or at
some future time.
5. EXEMPTION FROM CLEARANCE REQUIREMENT
Clearance is not required for any account over which the Access
Person has no influence or control. In case of doubt the Access
Person may state on the Securities Transaction Approval Form that he
or she disclaims any beneficial ownership in the securities involved.
D. REPORT OF TRANSACTIONS
1. TRANSACTIONS AND ACCOUNTS COVERED
(a) All securities transactions, except for transactions involving
exempt securities listed in Section V., sub-section C.3. (a) of
this Code must be reported in the next quarterly transaction
report after the transaction is effected. In addition, any new
brokerage account(s) opened during the quarter as well as the
date(s) the account(s) was opened must be reported.
(b) EVERY ACCESS PERSON MUST FILE A REPORT WHEN DUE EVEN IF SUCH
PERSON MADE NO PURCHASES OR SALES OF SECURITIES DURING THE PERIOD
COVERED BY THE REPORT.
7
<PAGE>
(c) Directors and officers who, pursuant to Section III, are exempt
from preclearance ARE subject to the quarterly reporting
requirements.
2. TIME OF REPORTING
(a) INITIAL HOLDINGS REPORT
Each Access Person must, at the time of becoming an Access
Person, provide an initial holdings report to the Compliance
Officer or Compliance Coordinator disclosing (i) all securities
beneficially owned by the Access Person listing the title of the
security, number of shares held, and principal amount of the
security (any privately-placed securities held must be reported)
(ii) the name of the broker dealer or financial institution where
the Access Person maintains a personal account and (iii) the date
the report is submitted by the Access Person. New employees will
be required to provide a listing of all non-exempt securities
holdings as of the date of commencement of employment as well as
a listing of all outside brokerage accounts. This report must be
provided no later than 10 days after a person becomes an Access
Person.
(b) QUARTERLY TRANSACTION REPORTS
Each Access Person must submit a quarterly report of all
securities transactions, except for transactions involving exempt
securities listed in Section V., sub-section C.3. (a) of this
Code, and any new accounts(s) opened during the quarter as well
as the date(s) the account(s) was opened within 10 calendar days
after the end of each calendar quarter.
(c) ANNUAL HOLDINGS REPORTS
The January Annual Listing of Securities Holdings Report requires
all Access Persons to provide an annual listing of holdings of
(i) all securities beneficially owned listing the title of the
security, number of shares held, and principal amount of the
security as of December 31 of the preceding year, except
securities exempt from pre-clearance AND reporting under Section
V., sub-section C. 3(a), (ii) the name of any broker dealer or
financial institution where the account(s) are maintained, as of
December 31 of the preceding year (a current listing will also be
required upon the effectiveness of this Code) and (iii) the date
the Report is submitted by the Access Person. The information
must be current as of a date not more than 30 days before the
report is submitted.
3. FORM OF REPORTING
The initial holdings report, quarterly transaction report and the
annual listing of holdings report must be on the appropriate forms
provided by MSDW Advisors or may consist of broker statements
(attached to the Report form or, if an MSDW account, the broker
statements formerly sent to MSDW Advisors' Risk Management
Department) which provide at least the same information. In the event
that MSDW Advisors already maintains a record of the required
information, an Access Person may satisfy this requirement by
(i) confirming in writing (which may include e-mail) the accuracy and
completeness of the record and disclose the beneficial ownership of
securities (if any) not listed on the account statement and
(ii) recording the date of the confirmation. Copies of MSDW Advisors'
initial holdings report, quarterly transaction report and the annual
listing of holdings report, which may be revised at any time, are
attached as Exhibits D, E, and F, respectively.
8
<PAGE>
4. RESPONSIBILITY TO REPORT
The responsibility for taking the initiative to report is imposed on
each individual required to make a report. Any effort by MSDW
Advisors to facilitate the reporting process does not change or alter
that responsibility.
5. WHERE TO FILE REPORT
All reports must be filed with the Risk Management Department of MSDW
Advisors.
6. RESPONSIBILITY TO REVIEW
MSDW Advisors' Risk Management Department's Compliance Officer or
Compliance Coordinator will review all initial holdings reports,
quarterly transaction reports, and annual listing of holdings reports
filed by Access Persons.
VI. REVIEW COMMITTEE
A Code of Ethics Review Committee, consisting of the CEO/ President, Chief
Investment Officer and the General Counsel of MSDW Advisors, will review and
consider any proper request of an Access Person 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
Access Person. The committee shall meet on an ad hoc basis, as deemed
necessary upon written request by an Access Person, stating the basis for
his or her request for relief. The committee's decision is solely within its
complete discretion.
VII. SERVICE AS DIRECTOR
No Access Person 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 Chinese Wall
procedures to isolate investment personnel serving as directors from making
investment decisions for Morgan Stanley Dean Witter Funds or MSDW Advisors
Managed Accounts concerning the company in question.
VIII. GIFTS
No Access Person 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 Morgan Stanley Dean Witter Fund or
MSDW Advisors Managed Account, not including occasional meals or tickets
to theater or sporting events or other similar entertainment.
IX. SANCTIONS
Upon discovering a violation of this Code, MSDW Advisors may impose such
sanctions as it deems appropriate, including, but not limited to, a
reprimand (orally or in writing), demotion, and suspension or termination of
employment. The CEO of MSDW Advisors, 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.
X. EFFECTIVE DATE
All employees, officers and Directors of MSDW Advisors, Services and
Distributors (whether or not Access Persons) are required to sign a copy of
this Code indicating their agreement to abide by the terms of this Code.
In addition, all employees, officers and Directors of MSDW Advisors, Services
and Distributors will be required to certify annually that (i) they have read
and understand the terms of this Code of Ethics 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 of
Ethics, including but
9
<PAGE>
not limited to the reporting of all brokerage accounts, the preclearance for
Access Persons and all non-exempt personal securities transactions in
accordance with this Code.
XI. EMPLOYEE CERTIFICATION
I have read and understand the terms of the above Code of Ethics. I
recognize the responsibilities and obligations, including but not limited to
my quarterly transaction, annual listing of holdings, and initial holdings
reporting obligations, incurred by me as a result of my being subject to
this Code of Ethics. I hereby agree to abide by the above Code of Ethics.
- -------------------------------------- ------------------------
(Signature) (Date)
- --------------------------------------
(Print name)
10
<PAGE>
EXHIBIT A
MORGAN STANLEY DEAN WITTER ADVISORS
PRIVATE PLACEMENT APPROVAL REQUEST
(ATTACH A COPY OF THE PRIVATE PLACEMENT MEMORANDUM, OFFERING MEMORANDUM OR ANY
OTHER RELEVANT DOCUMENTS)
______________________________ ____________________________
NAME (PLEASE PRINT) DEPARTMENT & JOB TITLE
1. Name of the sponsor's corporation, partnership or other entity (the
"Private Placement"):
___________________________________________________________________________
2. Is the sponsor's corporation or partnership: | | Public | | Private
3. Type of security or fund: _________________________________________________
4. Nature of participation (e.g. Stockholder, General Partner, Limited
Partner). Indicate all applicable:
___________________________________________________________________________
5. Planned date of transaction: ______________________________________________
6. Size of offering (if a fund, size of fund): _______________________________
7. Size of your participation (number of units/shares and dollar amount):
___________________________________________________________________________
8. Would the investment carry limited or unlimited liability?
| | Limited | | Unlimited
9. Would the investment require any use of MSDW Advisors' premises, facilities
or materials? | | Yes | | No
If "yes," please describe: ________________________________________________
10. Are other MSDW Advisors' personnel or clients involved? | | Yes | | No
If "yes," please describe: ________________________________________________
11. Describe the business to be conducted by the Private Placement:
___________________________________________________________________________
If Private Placement is a fund:
- Describe investment objectives of the fund (e.g. value, growth, core or
specialty)
_______________________________________________________________________
- Is this a permissible investment for an account or fund that you
manage? | | Yes | | No
If "yes", please describe which client or fund:
_______________________________________________________________________
12. Will you participate in any investment decisions for the Private Placement?
| | Yes | | No
If "Yes," please describe:
___________________________________________________________________________
13. Describe how you became aware of this Private Placement:
___________________________________________________________________________
14. Has this private placement been made available to an account or fund that
you manage? IF no, state why:
___________________________________________________________________________
15. To the best of your knowledge, will this Private Placement result in an
initial public offering ("IPO")? | | YES | | NO
- --------------------------------------------------------------------------------
I understand that approval, if granted, is based upon the information provided
herein and I agree to observe any conditions imposed upon such approval, I will
notify MSDW Advisors Risk Management Department in writing if any aspect of the
Private Placement is proposed to be changed (e.g., investment focus of fund,
compensation, involvement in organization's management) and I hereby acknowledge
that such changes may require further approvals, or disinvestment by me.
I represent (i) that I have read and understand the MSDW Advisors' Code of
Ethics (the "Code") with respect to personal trading and recognize that I am
subject thereto; (ii) that the above trade is in compliance with the Code;
(iii) that to the best of my knowledge that the above trade does not
represent a conflict of interest, or an appearance of a conflict of interest,
with any MSDW Client or MSDW Fund; and (iv) that I have no knowledge of any
pending client orders in this security nor is the above trade in a related
security which indirectly would result in a transaction in a security in
which there are pending client orders. Furthermore, I acknowledge that no
action should be taken by me to effect the trade(s) listed above until I have
received formal approval.
Signature_________________________ Date: ___________________
Date Received by Risk Management: _________________________
Approved: ________ Disapproved: __________ Date: ___________________
<PAGE>
EXHIBIT B
SECURITIES TRANSACTION APPROVAL FORM
MORGAN STANLEY DEAN WITTER ADVISORS INC.
MORGAN STANLEY DEAN WITTER SERVICES COMPANY INC.
MORGAN STANLEY DEAN WITTER DISTRIBUTORS INC.
<TABLE>
<S><C>
- ---------------------------------------------------------------------------------------------------------------------------
PRINT NAME DEPARTMENT NAME OF PORTFOLIO MANAGER TO WHOM YOU REPORT
IF INVESTMENT DEPARTMENT COMPLETE BOX ->
- ---------------------------------------------------------------------------------------------------------------------------
DEAN WITTER ACCOUNT NO./MSDW NAME OF FINANCIAL ADVISOR DEANWITTER BRANCH/MSDW ONLINE
ONLINE ACCOUNT NO.
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
REQUEST FOR PERMISSION TO ENGAGE IN PERSONAL TRANSACTION
--------------------------------------------------------
I hereby request permission to effect a transaction in the security as
indicated below for my own account or other account in which I have a beneficial
interest or legal title. THE APPROVAL WILL BE EFFECTIVE ONLY FOR A TRANSACTION
COMPLETED PRIOR TO THE CLOSE OF BUSINESS ON THE DAY OF APPROVAL. ANY
TRANSACTION, OR PORTION THEREOF, NOT SO COMPLETED WILL REQUIRE A NEW APPROVAL.
NOTE: A SEPARATE FORM MUST BE USED FOR EACH SECURITY TRANSACTION. ADVISE YOUR
FINANCIAL ADVISOR/MSDW ONLINE TO SUPPLY DUPLICATE CONFIRMS AND STATEMENTS ON ALL
TRANSACTIONS TO: MORGAN STANLEY DEAN WITTER ADVISORS INC., RISK MANAGEMENT
DEPARTMENT, TWO WORLD TRADE CENTER, NEW YORK, N.Y. 10048
I AM FAMILIAR WITH AND AGREE TO ABIDE BY THE REQUIREMENTS SET FORTH IN THE
MORGAN STANLEY DEAN WITTER ADVISORS INC. CODE OF ETHICS AND PARTICULARLY THE
FOLLOWING:
1. In the case of a purchase, I agree that I will not sell the security at
a profit for a minimum of sixty days from the date of the purchase
transaction. In the case of a sale, I agree that I will not purchase
the security at a profit for a minimum of sixty days from the date of
the sale transaction. Any violation will result in disgorgement of all
profits from the transaction.
2. I represent that this security: (A) is not involved in an Initial
Public Offering (IPO) and (B) does not involve a short sale, futures or
option transaction.
3. For any private placement, I am aware that specific pre-approval must
be obtained from the Morgan Stanley Dean Witter Advisors Inc. Code of
Ethics Review Committee.
4. For (A) EQUITY PORTFOLIO MANAGERS AND PERSONS REPORTING TO EQUITY
PORTFOLIO MANAGERS: I am aware that I must obtain the equity
security's description page from Bloomberg and attach the
description to this preapproval form and a signature from Joe
McAlinden or Rajesh Gupta as one of my Approving Officers (in
their absence I shall obtain the initials of my immediate
supervisor). I am aware that in certain cases I may be
required to disgorge any profits from a transaction if a
Morgan Stanley Dean Witter Fund buys or sells the same
security within 30 days preceding or subsequent to my
transaction (see Section V.B. (7) of the Code of Ethics for a
complete description of the scope of this restriction).
(B) PORTFOLIO MANAGERS AND PERSONS REPORTING TO PORTFOLIO
MANAGERS: I am aware that I must obtain a signature from Joe
McAlinden or Rajesh Gupta as one of my Approving Officers (in
their absence I shall obtain the initials of my immediate
supervisor). I am aware that in certain cases I may be
required to disgorge any profits from a transaction if a
Morgan Stanley Dean Witter Fund buys or sells the same
security within 30 days preceding or subsequent to my
transaction (see Section V.B. (7) of the Code of Ethics for a
complete description of the scope of this restriction).
(C) PERSONNEL IN THE MORGAN STANLEY DEAN WITTER ADVISORS INC.
TRADING DEPARTMENT: I am aware that in certain cases I may be
required to disgorge any profits from a transaction if a
Morgan Stanley Dean Witter Fund buys or sells the same
security within 7 days preceding or subsequent to my
transaction (see Section V.B.(7) of the Code of Ethics for a
complete description of the scope of this restriction).
- --------------------------------------------------------------------------------
A. PURCHASE
<TABLE>
<S><C>
-----------------------------------------------------------------------------------------------------------
NAME OF SECURITY/SYMBOL CUSIP NUMBER FOR FIXED INCOME SECURITIES ONLY
-----------------------------------------------------------------------------------------------------------
NUMBER OF SHARES OR ORDER PRICE EXECUTION PRICE TOTAL PRICE
PRINCIPAL AMOUNT
-----------------------------------------------------------------------------------------------------------
HAVE YOU SOLD ANY SHARES OF THIS SECURITY WITHIN THE PAST SIXTY DAYS? NO | | YES | | IF YES, AT WHAT PRICE PER SHARE? $
- ------------------------------------------------------------------------------------------------------------------------------------
B. SALE
-----------------------------------------------------------------------------------------------------------
NAME OF SECURITY/SYMBOL CUSIP NUMBER FOR FIXED INCOME SECURITIES ONLY
-----------------------------------------------------------------------------------------------------------
NUMBER OF SHARES OR ORDER PRICE EXECUTION PRICE TOTAL PRICE DATE ACQUIRED UNIT PRICE AT
PRINCIPAL AMOUNT ACQUISITION
- ------------------------------------------------------------------------------------------------------------------------------------
| | CHECK BOX IF THE SECURITY IS OFFERED THROUGH A PRIVATE DATE: YOUR SIGNATURE:
PLACEMENT. IF SO, CONTACT THE MORGAN STANLEY DEAN WITTER
ADVISORS INC. RISK MANAGEMENT DEPARTMENT FIRST.
- ------------------------------------------------------------------------------------------------------------------------------------
PERMISSION: GRANTED:________ DATE: TRADING DEPARTMENT SIGNATURE: IF APPLICABLE, RISK MANAGEMENT
DEPARTMENT REVIEW:
DENIED: ________ _________________
- ------------------------------------------------------------------------------------------------------------------------------------
DATE: SIGNATURE - APPROVING OFFICER: DATE: SIGNATURE - APPROVING OFFICER:
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*IF SHARES BEING SOLD WERE PURCHASED ON MORE THAN ONE DATE, EACH ACQUISITION
DATE MUST BE LISTED FOR PURPOSES OF DETERMINING THE 60-DAY HOLDING PERIOD. THE
WHITE COPY OF THIS PREAPPROVAL FORM MUST BE RETURNED TO THE RISK MANAGEMENT
DEPARTMENT BY NOON OF THE DAY FOLLOWING EXECUTION OF THE TRADE.
WHITE -- RISK MANAGEMENT PINK -- EMPLOYEE COPY
<PAGE>
<TABLE>
<S><C>
EXHIBIT C
MORGAN STANLEY DEAN WITTER ADVISORS ("MSDW ADVISORS")
MSDW EMPLOYEE REQUEST FORM FOR
OPENING AN MSDW ONLINE BROKERAGE ACCOUNT
Please complete this form for all "employee accounts" you intend to maintain at Morgan Stanley
Dean Witter Online, Inc. ("MSDW Online"). Please make additional copies of this page as necessary
in order to include information for all your accounts. After MSDW Advisors' Risk Management
Department's review, this form will be returned to you.
_________________________________ ____________________________ _______________________
PRINT NAME EMPLOYEE ID # FAX #
_________________________________ __________________________________________________________
SOCIAL SECURITY # DEPARTMENT/BRANCH #
Check one of the following:
| | I am an MSDW employee | | I am a subcontractor/vendor
_______________________________________________________________________________
ACCOUNT INFORMATION
_______________________________________________________________________________
The following MSDW Online account is currently open or will be opened.
Account Title:______________________________________________________________
MSDW Online Account Number:_________________________________________________
(TO BE COMPLETED BY MSDW ONLINE)
Employee's relationship to account owner:___________________________________
| | This account is NOT independently managed; I am involved in the
investment decisions.(2)
| | This account is independently managed; I am NOT involved in the
investment decisions.(3)
Name of investment manager and relationship, if any:________________________
_______________________________________________________________________________
By signing below, you agree to abide by MSDW Advisors Employee Trading Policy and any desk or
division trading policy applicable to you with respect to any account maintained at MSDW Online.
DATE:_____________________________ SIGNATURE:_____________________________
PLEASE SEND DUPLICATE STATEMENTS & TRADE CONFIRMATIONS TO:
__________________________________________________________
MSDW ADVISORS
2 WORLD TRADE CENTER, 70TH FLOOR
NEW YORK, NY 10048
ATTN: RISK MANAGEMENT DEPARTMENT
_________________________________________________________________________________________________
TO MSDW ONLINE:
Pursuant to NYSE Rule 407, please accept this form as notification that MSDW Advisors has
approved the employee named above to maintain the account titled above with your firm. The
employee has a beneficial interest in such account. This account must be placed in the
appropriate employee account range, i.e., MSDW Advisors, Morgan Stanley Dean Witter Services
Company and Morgan Stanley Dean Witter Distributors, in order to permit appropriate review by
MSDW Advisors.
DATE:_____________________________ APPROVED BY: _______________________________
SIGNATURE
_______________________________
PRINT NAME
MSDW ADVISORS RISK MANAGEMENT
(1) An "employee" account means any brokerage account owned or controlled, in whole or in part,
directly or indirectly by you, whether held in your name individually, or jointly with
others, or not in your name at all. Refer to Section V. subsection C.4 Accounts Covered under
MSDW Advisors' Code of Ethics for further clarification. If you are unsure as to whether an
account is an employee account, MSDW Advisors, MSDW Services Company and MSDW Distributors
employees should call the Risk Management Department at 212-392-1534.
(2) Your participation in the selection of any investment, including mutual funds, means that the
account is NOT independently managed.
(3) You must not be involved in investment selections through recommendation, advice, and prior
review or otherwise, or you must be a passive beneficiary of the account in order to
represent that you are not involved in investment decisions for the account.
</TABLE>
<PAGE>
<TABLE>
<S><C>
EXHIBIT D
MORGAN STANLEY DEAN WITTER ADVISORS INC.
MORGAN STANLEY DEAN WITTER DISTRIBUTORS INC.
MORGAN STANLEY DEAN WITTER SERVICES COMPANY INC.
LISTING OF SECURITIES HOLDINGS AND BROKERAGE ACCOUNTS (INITIAL)
===============================================================
I hereby certify that the following is a complete listing of all securities
beneficially owned by me AS OF THE DATE HEREOF. I also hereby certify that, set forth below, is a
listing of all brokerage accounts and any other accounts holding securities maintained by me.
NOTE: The term "securities" includes all stocks, bonds, derivatives, private
placements, limited partnership interests, etc. Failure to fully disclose all securities, whether
or not held in a Morgan Stanley Dean Witter brokerage account or Morgan Stanley Dean Witter
Online account, will be considered a violation of the Code of Ethics.
=================================================================================================
TYPE OF SECURITY NUMBER OF
SHARES OR YEAR
I. TITLE OF SECURITY (Indicate if security PRINCIPAL ACQUIRED
is a Private AMOUNT
Placement etc.)
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
(Use additional sheet if necessary)
=================================================================================================
II. NAME OF BROKERAGE ACCOUNT LOCATION ACCOUNT NUMBER
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
_________________________________________________________________________________________________
(Use additional sheet if necessary)
_______________________________ __/__/__
(Sign Name) (Date)
_______________________________
(Print Name)
</TABLE>
<PAGE>
EXHIBIT E
MORGAN STANLEY DEAN WITTER ADVISORS INC.
MORGAN STANLEY DEAN WITTER DISTRIBUTORS INC.
MORGAN STANLEY DEAN WITTER SERVICES COMPANY INC.
QUARTERLY SECURITIES TRANSACTIONS - CONFIDENTIAL REPORT
_______________________________________________________
XXXXQUARTER 2000/ XXX.,XXX.,XXX.
The following lists all transactions in securities in which I had any direct or
indirect beneficial ownership during the last calendar quarter (excluding
securities exempted by Section V., sub-section C.3.(a) of the Morgan Stanley
Dean Witter Advisors Code of Ethics (revised March 1, 2000).
ANY TRANSACTIONS IN UNIT INVESTMENT TRUSTS OR MORGAN STANLEY DEAN WITTER & CO.
STOCK (INCLUDING EXERCISE OF STOCK OPTION GRANTS) MUST BE REPORTED ON THIS FORM.
IF ALL TRANSACTIONS LISTED BELOW WERE EXECUTED THROUGH MSDW AND ALL THE
APPLICABLE INFORMATION IS REFLECTED IN THE CONFIRMS PREVIOUSLY SENT, INDICATE SO
ON THIS FORM. *Use reverse side if additional space is needed.
IF NO TRANSACTIONS TOOK PLACE, WRITE "NONE".
<TABLE>
<CAPTION>
<S><C>
DATE OF NUMBER OF TITLE OF SECURITY UNIT PRICE TOTAL PRICE BROKER
TRANSACTION SHARES OR (INCLUDING, IF APPLICABLE,
PRINCIPAL INTEREST AND MATURITY RATE)
AMOUNT
Purchases and Acquisitions
__________________________
___________________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________________
Sales and Other Acquisitions
____________________________
___________________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________________
___________________________________________________________________________________________________________________________
</TABLE>
1) Did you submit a pre-approval request form for each of the securities
transactions listed above? YES___ NO___
2) Which DWR branch maintains your account? ____________________________________
3) Who is your Financial Advisor at the Branch? ________________________________
4) (For MSDW Advisors and Distributors Directors and Officers only) To your
knowledge, are you the beneficial owner of more than 1/2 of 1% of the
outstanding securities of any issuer? YES___ NO___
If yes, please specify: _____________________________________________________
_____________________________________________________________________________
5) HAVE YOU RECEIVED WRITTEN PERMISSION TO MAINTAIN BROKERAGE ACCOUNT FOR YOU OR
A MEMBER OF YOUR IMMEDIATE FAMILY AT A BROKER-DEALER OTHER THAN DWR? YES___
NO___
6) IF "YES", HAVE ALL TRANSACTIONS BEEN PRECLEARED AND REPORTED AS
REQUIRED BY THE CODE OF ETHICS? YES___ NO___
7) HAVE YOU OPENED ANY NEW ACCOUNTS THIS QUARTER? YES___ NO___ IF "YES", WHAT
DATE WAS THIS ACCOUNT(S) OPENED?_____________________________________________
_____________________________________________________________________________
WHAT IS THE NAME OF THE BROKER DEALER OR FINANCIAL INSTITUTION WITH WHOM YOU
ESTABLISHED THE ACCOUNT? ____________________________________________________
Date: ____/____/____ Name: _____________________ Signed: ______________________
RETURN THIS FORM TO: MORGAN STANLEY DEAN WITTER ADVISORS RISK MANAGEMENT
DEPARTMENT, 2 WTC/7O, BY 00/00/00. REV (03/00)
<PAGE>
EXHIBIT F
MORGAN STANLEY DEAN WITTER ADVISORS INC.
MORGAN STANLEY DEAN WITTER DISTRIBUTORS INC.
MORGAN STANLEY DEAN WITTER SERVICES COMPANY INC.
ANNUAL LISTING OF SECURITIES HOLDINGS AND BROKERAGE ACCOUNTS
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I hereby certify that the following is a complete listing of all securities
(other than open-end mutual funds and other exempt securities as described in
Section V., sub-section C.3. (a) of the Code of Ethics) beneficially owned (as
defined in Section V., sub-section C.4 of the Code of Ethics) by me AS OF THE
DATE HEREOF. I also hereby certify that, set forth below, is a listing of all
brokerage accounts and any other accounts holding securities maintained by me. I
also hereby certify that, the information contained below is current as of the
date indicated below.
NOTE: The term "securities" includes all stocks, bonds, derivatives,
private placements, limited partnership interests, etc. ANY TRANSACTIONS IN UNIT
INVESTMENT TRUSTS OR MORGAN STANLEY DEAN WITTER & CO. STOCK (INCLUDING EXERCISE
OF STOCK OPTION GRANTS) MUST BE REPORTED ON THIS FORM. Failure to fully disclose
all securities holdings, whether or not held in a Morgan Stanley Dean Witter
brokerage account or MSDW Online Account, will be considered a violation of the
Code of Ethics.
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NUMBER OF
SHARES OR YEAR
I. TITLE OF SECURITY TYPE OF SECURITY PRINCIPAL ACQUIRED
AMOUNT
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__________________________________________________________________________________________________________________
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(Use additional sheet if necessary)
II. NAME OF BROKERAGE ACCOUNT LOCATION ACCOUNT NUMBER
__________________________________________________________________________________________________________________
__________________________________________________________________________________________________________________
__________________________________________________________________________________________________________________
__________________________________________________________________________________________________________________
__________________________________________________________________________________________________________________
(Use additional sheet if necessary)
______________________________ __/__/__
(Sign Name) (Date)
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______________________________
(Print Name)
PLEASE RETURN THIS FORM TO : MORGAN STANLEY DEAN WITTER ADVISORS' RISK
MANAGEMENT DEPARTMENT, 2 WTC /7O, BY 00/10/00.
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MORGAN STANLEY DEAN WITTER FUNDS
CODE OF ETHICS
I. INTRODUCTION
This Code of Ethics is adopted by the investment companies listed on
Schedule A attached hereto, which list may be amended from time to time
(each a "Fund" and collectively the "Morgan Stanley Dean Witter Funds" or
the "Funds"), in compliance with Rule 17j-1 promulgated by the Securities
and Exchange Commission ("SEC") under the Investment Company Act of 1940, as
amended. This Code covers all persons who are "Access Persons," as that term
is defined in Rule 17j-1. To the extent that any such individuals are
"Access Persons" under the Code of Ethics of the Funds' Investment Advisor,
Investment Manager, or Sub-Advisor, as applicable (any such entity herein
referred to as "Investment Advisor"), whose Codes have also been established
pursuant to Rule 17j-1, compliance by such individuals with the provisions
of the Code of the applicable Investment Advisor shall constitute compliance
with this Code.
II. PERSONAL TRANSACTIONS
A. REPORTS OF TRANSACTIONS - INDEPENDENT DIRECTORS/TRUSTEES
An Independent Director/Trustee of a Morgan Stanley Dean Witter Fund
shall report quarterly to the Fund any personal transaction in a security if
he or she knows or should know at the time of entering into the transaction
that: (a) the Fund has engaged in a transaction in the same security within
the last 15 days, or is engaging in such transaction or is going to engage
in a transaction in the same security in the next 15 days, or (b) the Fund
or its Investment Advisor has within the last 15 days considered a
transaction in the same security or is considering a transaction in the
security or within the next 15 days is going to consider a transaction in
the security.
B. REPORTS OF TRANSACTIONS, BROKERAGE ACCOUNTS AND HOLDINGS - ACCESS
PERSONS WHO ARE NOT INDEPENDENT DIRECTORS/ TRUSTEES
An Access Person who is not an Independent Director/Trustee of a Morgan
Stanley Dean Witter Fund shall report all non-exempt securities transactions
and new brokerage accounts on a quarterly basis.
An Access Person who is not an Independent Director/Trustee of a Morgan
Stanley Dean Witter Fund shall provide an annual listing of holdings of (i)
all securities beneficially owned as of December 31 of the preceding year,
except securities exempt from pre-clearance and reporting under Section D.,
(2) hereof listing the title of the security, number of shares held, and
principal amount of the security, (ii) the name of any broker dealer or
financial institution where the account(s) are maintained, as of December 31
of the preceding year (a current listing will also be required upon the
effectiveness of this Code) and (iii) the date the Report is submitted by
the Access Person. The information must be current as of a date not more
than 30 days before the report is submitted. New Access Persons, who are not
Independent Directors/Trustees of a Morgan Stanley Dean Witter Fund, will be
required to provide a listing of all non-exempt securities holdings, with
the information set forth above, as of the date of commencement of
employment as well as a listing of all outside brokerage accounts no later
than ten days after that person becomes an Access Person.
C. REPORTS OF TRANSACTIONS, BROKERAGE ACCOUNTS AND HOLDINGS - GENERAL
Any quarterly report required under A or B above must be made within ten
days after the end of the calendar quarter in which the personal transaction
occurred. The report may be made on the form provided by the Investment
Advisor or may consist of a broker statement that provides at least the same
information. In the event that MSDW Advisors already maintains a record of
the required information, an Access Person may satisfy this requirement by
(i) confirming in writing (which may include e-mail) the accuracy and
completeness of the record and disclose the beneficial ownership of
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securities (if any) not listed on the account statement and (ii) recording
the date of the confirmation. Copies of the Investment Advisor's forms,
which may be revised at any time, are attached.
The Funds' Compliance Officer will identify and advise all Access
Persons, including the Independent Directors/Trustees, subject to the
reporting requirement under A or B above, of their reporting requirement.
Each report required under A or B above will be submitted for review by the
Compliance Officer or Compliance Coordinator in the Risk Management
Department of the Investment Advisor.
D. DEFINITIONS AND EXEMPTIONS
(1) DEFINITIONS
For purposes of this Code the term "personal transaction" means the
purchase or sale, or other acquisition or disposition, of a security for
the account of the individual making the transaction or for an account in
which he or she has, or as a result of the transaction acquires, any
direct or indirect beneficial ownership in a security.
The term "beneficial ownership" is defined by rules of the SEC.
Generally, under SEC rules a person is regarded as having beneficial
ownership of securities held in the name of:
(a) a husband, wife, or minor child;
(b) a relative sharing the same house;
(c) anyone else if the access person -
(i) obtains benefits substantially equivalent to ownership of the
securities; or
(ii) can obtain ownership of the securities immediately or at
some future time.
The term "Access Person" is defined by rules of the SEC as (i) any
director, officer, or general partner of a fund or of a fund's investment
adviser, or any employee of a fund or of a fund's investment adviser who,
in connection with his or her regular functions or duties, participates
in the selection of a fund's portfolio securities or who has access to
information regarding a fund's future purchases or sales of portfolio
securities; or (ii) any director, officer, or general partner of a
principal underwriter who in the ordinary course of business, makes,
participates in or obtains information regarding, the purchase or sale of
securities for the fund for which the principal underwriter acts, or
whose functions or duties in the ordinary course of business relate to
the making of any recommendation to the fund regarding the purchase or
sale of securities.
(2) EXEMPTIONS
No report is required for a personal transaction in any of the
following securities:
(i) Securities issued by the U.S. Government;
(ii) Bank certificates of deposit;
(iii) Bankers' acceptances;
(iv) Commercial paper;
(v) Open-end mutual fund shares.
Also, no report is required with respect to any account over which
the access person has no influence or control.
III. CODE VIOLATIONS
Any officer of a Morgan Stanley Dean Witter Fund who discovers a
violation or apparent violation of this Code by an access person shall bring
the matter to the attention of the Chief Executive Officer or General
Counsel of the Fund who shall then report the matter to the Board of
Directors or the Board of Trustees, as the case may be, of the fund. The
Board shall determine
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whether a violation has occurred and, if it so finds, may impose such
sanctions, if any, as it considers appropriate.
IV. ADMINISTRATION OF CODE OF ETHICS
On a quarterly basis, the Board of Directors or the Board of Trustees of
each of the Funds shall be provided with a written report by each of the
Funds and the Investment Advisors, that describes any new issues arising
under the Code of Ethics, including information on material violations of
the Code of Ethics or procedures and sanctions imposed, and certifies that
each Fund and the Investment Advisors have adopted procedures reasonably
necessary to prevent Access Persons from violating the Code of Ethics.
Rev. March 1, 2000
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MORGAN STANLEY DEAN WITTER FUNDS
AT
FEBRUARY 29, 2000
MONEY MARKET FUNDS
1. Active Assets California Tax-Free Trust ("AA CALIFORNIA")
2. Active Assets Government Securities Trust ("AA GOVERNMENT")
3. Active Assets Institutional Money Trust ("AA INSTITUTIONAL")
4. Active Assets Money Trust ("AA MONEY")
5. Active Assets Premier Money Trust ("AA PREMIER")
6. Active Assets Tax-Free Trust ("AA TAX-FREE")
7. Morgan Stanley Dean Witter California Tax-Free Daily Income Trust
("CALIFORNIA TAX-FREE DAILY")
8. Morgan Stanley Dean Witter Liquid Asset Fund Inc. ("LIQUID ASSET")
9. Morgan Stanley Dean Witter New York Municipal Money Market Trust ("NEW
YORK MONEY")
10. Morgan Stanley Dean Witter Tax-Free Daily Income Trust ("TAX-FREE
DAILY")
11. Morgan Stanley Dean Witter U.S. Government Money Market Trust
("GOVERNMENT MONEY")
EQUITY FUNDS
12. Morgan Stanley Dean Witter Aggressive Equity Fund ("AGGRESSIVE EQUITY")
13. Morgan Stanley Dean Witter American Opportunities Fund ("AMERICAN
OPPORTUNITIES")
14. Morgan Stanley Dean Witter Capital Growth Securities ("CAPITAL GROWTH")
15. Morgan Stanley Dean Witter Competitive Edge Fund ("COMPETITIVE EDGE")
16. Morgan Stanley Dean Witter Developing Growth Securities Trust
("DEVELOPING GROWTH")
17. Morgan Stanley Dean Witter Dividend Growth Securities Inc. ("DIVIDEND
GROWTH")
18. Morgan Stanley Dean Witter Equity Fund ("EQUITY FUND")
19. Morgan Stanley Dean Witter European Growth Fund Inc. ("EUROPEAN
GROWTH")
20. Morgan Stanley Dean Witter Financial Services Trust ("FINANCIAL
SERVICES")
21. Morgan Stanley Dean Witter Fund of Funds ("FUND OF FUNDS")
22. Morgan Stanley Dean Witter Global Dividend Growth Securities ("GLOBAL
DIVIDEND GROWTH")
23. Morgan Stanley Dean Witter Global Utilities Fund ("GLOBAL UTILITIES")
24. Morgan Stanley Dean Witter Growth Fund ("GROWTH FUND")
25. Morgan Stanley Dean Witter Health Sciences Trust ("HEALTH SCIENCES")
26. Morgan Stanley Dean Witter Income Builder Fund ("INCOME BUILDER")
27. Morgan Stanley Dean Witter Information Fund ("INFORMATION FUND")
28. Morgan Stanley Dean Witter International Fund ("INTERNATIONAL FUND")
29. Morgan Stanley Dean Witter International SmallCap Fund ("INTERNATIONAL
SMALLCAP")
30. Morgan Stanley Dean Witter Japan Fund ("JAPAN FUND")
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31. Morgan Stanley Dean Witter Latin American Growth Fund ("LATIN
AMERICAN")
32. Morgan Stanley Dean Witter Market Leader Trust ("MARKET LEADER")
33. Morgan Stanley Dean Witter Mid-Cap Dividend Growth Securities ("MID-CAP
DIVIDEND GROWTH")
34. Morgan Stanley Dean Witter Mid-Cap Equity Trust ("MID-CAP EQUITY")
35. Morgan Stanley Dean Witter Natural Resource Development Securities Inc.
("NATURAL RESOURCE")
36. Morgan Stanley Dean Witter Next Generation Trust ("NEXT GENERATION")
37. Morgan Stanley Dean Witter Pacific Growth Fund Inc. ("PACIFIC GROWTH")
38. Morgan Stanley Dean Witter Real Estate Fund ("REAL ESTATE")
39. Morgan Stanley Dean Witter Small Cap Growth Fund ("SMALL CAP GROWTH")
40. Morgan Stanley Dean Witter S&P 500 Index Fund ("S&P500 INDEX")
41. Morgan Stanley Dean Witter S&P 500 Select Fund ("S&P 500 SELECT")
42. Morgan Stanley Dean Witter Special Value Fund ("SPECIAL VALUE")
43. Morgan Stanley Dean Witter Tax-Managed Growth Fund ("TAX-MANAGED
GROWTH")
44. Morgan Stanley Dean Witter Total Market Index Fund ("TOTAL MARKET
INDEX")
45. Morgan Stanley Dean Witter Total Return Trust ("TOTAL RETURN")
46. Morgan Stanley Dean Witter 21st Century Trend Fund ("21ST CENTURY
TREND")
47. Morgan Stanley Dean Witter Utilities Fund ("UTILITIES FUND")
48. Morgan Stanley Dean Witter Value-Added Market Series ("VALUE-ADDED")
49. Morgan Stanley Dean Witter Value Fund ("VALUE FUND")
BALANCED FUNDS
50. Morgan Stanley Dean Witter Balanced Growth Fund ("BALANCED GROWTH")
51. Morgan Stanley Dean Witter Balanced Income Fund ("BALANCED INCOME")
ASSET ALLOCATION FUND
52. Morgan Stanley Dean Witter Strategist Fund ("STRATEGIST FUND")
FIXED-INCOME FUNDS
53. Morgan Stanley Dean Witter California Tax-Free Income Fund ("CALIFORNIA
TAX-FREE")
54. Morgan Stanley Dean Witter Convertible Securities Trust ("CONVERTIBLE
SECURITIES")
55. Morgan Stanley Dean Witter Diversified Income Trust ("DIVERSIFIED
INCOME")
56. Morgan Stanley Dean Witter Federal Securities Trust ("FEDERAL
SECURITIES")
57. Morgan Stanley Dean Witter Hawaii Municipal Trust ("HAWAII MUNICIPAL")
58. Morgan Stanley Dean Witter High Yield Securities Inc ("HIGH YIELD")
59. Morgan Stanley Dean Witter Intermediate Income Securities
("INTERMEDIATE INCOME")
60. Morgan Stanley Dean Witter Limited Term Municipal Trust ("LIMITED TERM
MUNICIPAL")
61. Morgan Stanley Dean Witter Multi-State Municipal Series Trust
("MULTI-STATE SERIES")
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62. Morgan Stanley Dean Witter New York Tax-Free Income Fund ("NEW YORK
TAX-FREE")
63. Morgan Stanley Dean Witter North American Government Income Trust
("NORTH AMERICAN GOVERNMENT")
64. Morgan Stanley Dean Witter Select Municipal Reinvestment Fund
("MUNICIPAL REINVESTMENT")
65. Morgan Stanley Dean Witter Short-Term Bond Fund ("SHORT-TERM BOND")
66. Morgan Stanley Dean Witter Short-Term U.S. Treasury Trust ("SHORT-TERM
TREASURY")
67. Morgan Stanley Dean Witter Tax-Exempt Securities Trust ("TAX-EXEMPT
SECURITIES")
68. Morgan Stanley Dean Witter U.S. Government Securities Trust
("GOVERNMENT SECURITIES")
69. Morgan Stanley Dean Witter World Wide Income Trust ("WORLD WIDE
INCOME")
SPECIAL PURPOSE FUNDS
70. Morgan Stanley Dean Witter Select Dimensions Investment Series ("SELECT
DIMENSIONS")
71. Morgan Stanley Dean Witter Variable Investment Series ("VARIABLE
INVESTMENT")
CLOSED-END FUNDS
72. Morgan Stanley Dean Witter California Insured Municipal Income Trust
("CALIFORNIA INSURED MUNICIPAL")
73. Morgan Stanley Dean Witter California Quality Municipal Securities
("CALIFORNIA QUALITY MUNICIPAL")
74. Morgan Stanley Dean Witter Government Income Trust ("GOVERNMENT
INCOME")
75. Morgan Stanley Dean Witter High Income Advantage Trust ("HIGH INCOME")
76. Morgan Stanley Dean Witter High Income Advantage Trust II ("HIGH INCOME
II")
77. Morgan Stanley Dean Witter High Income Advantage Trust III ("HIGH
INCOME III")
78. Morgan Stanley Dean Witter Income Securities Inc. ("INCOME SECURITIES")
79. Morgan Stanley Dean Witter Insured California Municipal Securities
("INSURED CALIFORNIA SECURITIES")
80. Morgan Stanley Dean Witter Insured Municipal Bond Trust ("INSURED
MUNICIPAL BOND")
81. Morgan Stanley Dean Witter Insured Municipal Income Trust ("INSURED
MUNICIPAL INCOME")
82. Morgan Stanley Dean Witter Insured Municipal Securities ("INSURED
MUNICIPAL SECURITIES")
83. Morgan Stanley Dean Witter Insured Municipal Trust ("INSURED MUNICIPAL
TRUST")
84. Morgan Stanley Dean Witter Municipal Income Opportunities Trust
("MUNICIPAL OPPORTUNITIES")
85. Morgan Stanley Dean Witter Municipal Income Opportunities Trust II
("MUNICIPAL OPPORTUNITIES II")
86. Morgan Stanley Dean Witter Municipal Income Opportunities Trust III
("MUNICIPAL OPPORTUNITIES III")
87. Morgan Stanley Dean Witter Municipal Income Trust ("MUNICIPAL INCOME")
88. Morgan Stanley Dean Witter Municipal Income Trust II ("MUNICIPAL INCOME
II")
89. Morgan Stanley Dean Witter Municipal Income Trust III ("MUNICIPAL
INCOME III")
90. Morgan Stanley Dean Witter Municipal Premium Income Trust ("MUNICIPAL
PREMIUM")
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91. Morgan Stanley Dean Witter New York Quality Municipal Securities ("NEW
YORK QUALITY MUNICIPAL")
92. Morgan Stanley Dean Witter Prime Income Trust ("PRIME INCOME")
93. Morgan Stanley Dean Witter Quality Municipal Income Trust ("QUALITY
MUNICIPAL INCOME")
94. Morgan Stanley Dean Witter Quality Municipal Investment Trust ("QUALITY
MUNICIPAL INVESTMENT")
95. Morgan Stanley Dean Witter Quality Municipal Securities ("QUALITY
MUNICIPAL SECURITIES")
TCW/DW TERM TRUSTS
AT
FEBRUARY 29, 2000
1. TCW/DW Term Trust 2000 ("TERM TRUST 2000")
2. TCW/DW Term Trust 2002 ("TERM TRUST 2002")
3. TCW/DW Term Trust 2003 ("TERM TRUST 2003")
