Utility Stock Series 1
File No. 33-7583
Investment Company Act No. 811-5065
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 10
TO FORM S-6
For Registration Under the Securities Act of 1933 of Securities
of Unit Investment Trusts Registered on Form N-8B-2
A. Exact name of Trust:
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
B. Name of Depositor:
DEAN WITTER REYNOLDS INC.
C. Complete address of Depositor's principal executive
office:
DEAN WITTER REYNOLDS INC.
Two World Trade Center
New York, New York 10048
D. Name and complete address of agent for service:
Mr. Michael D. Browne
Dean Witter Reynolds Inc.
Unit Trust Department
Two World Trade Center, 59th Floor
New York, New York 10048
Copy to:
Kenneth W. Orce, Esq.
Cahill Gordon & Reindel
80 Pine Street
New York, New York 10005
Check box if it is proposed that this filing should
/x/ become effective immediately upon filing pursuant to
paragraph(b) of Rule 485.
<PAGE>
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
Cross Reference Sheet
Pursuant to Rule 404(c) of Regulation C
under the Securities Act of 1933
(Form N-8B-2 Items required by Instruction 1
as to Prospectus on Form S-6)
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
I. Organization and General Information
1. a) Name of Trust Front Cover
b) Title of securities issued
2. Name and address of Depositor Table of Contents
3. Name and address of Trustee Table of Contents
4. Name and address of principal Table of Contents
Underwriter
5. Organization of Trust Introduction
6. Execution and termination of Introduction;
Trust Agreement Administration of the
Trust -- Termination
7. Changes of name *30
8. Fiscal Year Included in Form N-8B-2
9. Litigation *30
II. General Description of the Trust
and Securities of the Trust
10. General Information regarding
Trust's Securities and Rights
of Holders
a) Type of Securities Rights of Unit Holders --
(Registered or Bearer) Unit Holders
b) Type of Securities Administration of the
(Cumulative or Trust -- Distributions
Distributive)
c) Rights of Holders as to Rights of Unit Holders --
Withdrawal or Redemption Unit Holders; Redemption;
Public Offering of Units-
Secondary Market;
Exchange Option
d) Rights of Holders as to Public Offering of
conversion, transfer, etc. Units -- Secondary
Market; Exchange Option;
Redemption; Rights of
Unit Holders-Unit Holders
e) Lapses or defaults with *30
respect to periodic payment
plan certificates
f) Voting rights as to Rights of Unit Holders-
Securities under the Certain Limitations;
Indenture Administration of the
Trust -- Amendment; --
Termination
g) Notice to Holders as to
change in:
1) Assets of Trust Administration of the
Trust -- Portfolio
Supervision; The Trust-
Summary Description of
the Portfolio
2) Terms and Conditions Administration of the
of Trust's Securities Trust -- Amendment
3) Provisions of Trust Administration of the
Trust -- Amendment
4) Identity of Depositor Resignation, removal and
and Trustee Liability -- Regarding
the Trustee; -- Regarding
the Sponsor
h) Consent of Security Holders
required to change:
1) Composition of assets Administration of the
of Trust Trust -- Amendment
2) Terms and conditions Administration of the
of Trust's Securities Trust -- Amendment
3) Provisions of Indenture Administration of the
Trust -- Amendment
4) Identity of Depositor *30
and Trustee
11. Type of securities comprising The Trust-Summary
units Description of the
Portfolio; - Objectives
and Securities Selection
12. Type of securities comprising *30
periodic payment certificates
13. a) Load, fees, expenses, etc. Public Offering of
Units -- Public Offering
Price; - Volume Discount;
Exchange Option; Expenses
and Charges
b) Certain information *30
regarding periodic payment
certificates
c) Certain percentages Public Offering of
Units -- Public Offering
Price; -- Profit of
Sponsor; -- Volume
Discount; Exchange Option
d) Certain other fees, etc. Rights of Unit Holders --
payable by holders Unit Holders
e) Certain profits receivable Public Offering of Units
by depositor, principal -- Profit of Sponsor
underwriters, trustee or
affiliated persons
f) Ratio of annual charges *30
to income
14. Issuance of trust's securities Introduction
15. Receipt and handling of Public Offering of Units-
payments from purchasers Profit of Sponsor
16. Acquisition and disposition Introduction; Administra-
of underlying securities tion of the Trust --
Portfolio Supervision;
The Trust -- Objectives
and Securities Selection
17. Withdrawal or redemption Redemption; Public
Offering of Units --
Secondary Market;
Exchange Option; Rights
of Unit Holders
18. a) Receipt and disposition Administration of the
of income Trust
b) Reinvestment of The Trust Reinvestment
distributions Program
c) Reserves or special fund Administration of the
Trust-Distributions
d) Schedule of distribution *30
19. Records, accounts and report Administration of the
Trust; Resignation,
Removal and Liability
20. Certain miscellaneous Administration of the
provisions of the trust Trust -- Amendment;
agreement -- Termination --
Resignation, Removal and
Liability -- Regarding
the Trustee; -- Regarding
the Sponsor
21. Loans to security holders *30
22. Limitations on liability Resignation, Removal and
Liability
23. Bonding arrangements Included on Form N-8B-2
24. Other material provisions of *30
trust agreement
III. Organization Personnel and
Affiliated Persons of Depositor
25. Organization of Depositor Miscellaneous -- Sponsor
26. Fees received by Depositor Public Offering of Units-
Profit of Sponsor
27. Business of Depositor Miscellaneous -- Sponsor;
and Included in Form N-
8B-2
28. Certain information as to *30
officials and affiliated
persons of Depositor
29. Voting securities of Depositor Included in Form N-8B-2
30. Persons controlling Depositor *30
31. Payments by Depositor for *30
certain other services
32. Payments by Depositor for *30
certain other services
rendered to trust
33. Remuneration of employees of *30
Depositor for certain services
rendered to trust
34. Remuneration of other *30
persons for certain services
rendered to trust
IV. Distribution and Redemption of Securities
35. Distribution of trust's Public Offering of Units-
securities by states Public Distribution
36. Suspension of sales of *30
trust's securities
37. Revocation of authority to *30
distribute
38. a) Method of distribution Public Offering of Units
b) Underwriting agreements
c) Selling agreements
39. a) Organization of principal Miscellaneous -- Sponsor
underwriter
b) N.A.S.D. membership of
principal underwriter
40. Certain fees received by Public Offering of Units-
principal underwriter Profit of Sponsor
41. a) Business of principal Miscellaneous -- Sponsor
underwriter
b) Branch officers of principal *30
underwriter
c) Salesman of principal *30
underwriter
42. Ownership of trust's securities *30
by certain persons
43. Certain brokerage commissions *30
received by principal
underwriter
44. a) Method of valuation Public Offering of Units
-- Public Offering Price;
-- Secondary Market
b) Schedule as to offering *30
price
c) Variation in offering Public Offering of Units-
price to certain persons -- Volume Discount;
Exchange Option
45. Suspension of redemption rights *30
46. a) Redemption valuation Public Offering of Units-
Secondary Market;
Redemption -- Right of
Redemption; --
Computation of Redemption
Value
b) Schedule as to redemption *30
price
47. Maintenance of position in See items 10(d), 44 and
underlying securities 46
V. Information concerning the Trustee or Custodian
48. Organization and regulation Miscellaneous -- Trustee
of Trustee
49. Fees and expenses of Trustee The Trust -- Income and
Distributions; Expenses
and Charges
50. Trustee's lien Expenses and Charges
VI. Information concerning Insurance
of Holders of Securities
51. a) Name and address of *30
Insurance Company
b) Type of policies *30
c) Type of risks insured and *30
excluded
d) Coverage of policies *30
e) Beneficiaries of policies *30
f) Terms and manner of *30
cancellation
g) Method of determining *30
premiums
h) Amount of aggregate *30
premiums paid
i) Who receives any part of *30
premiums
j) Other material provisions *30
of the Trust relating to
insurance
VII. Policy of Registrant
52. a) Method of selecting and Administration of
eliminating securities the Trust -- Portfolio
from the Trust Supervision; The Trust
-- Objectives and
Securities Selection;
- Summary Description
of the Portfolio
b) Elimination of securities *30
from the Trust
c) Policy of Trust regarding Administration of the
substitution and Trust -- Portfolio
elimination of securities Supervision; The Trust --
Objectives and Securities
Selection; -- Summary
Description of the
Portfolio
d) Description of any Administration of the
fundamental policy of the Trust -- Portfolio
Trust Supervision; the Trust --
Objectives and Securities
Selection; -- Summary
Description of the
Portfolio
53. a) Taxable status of the Tax Status of the Trust
Trust
b) Qualification of the *30
Trust as regulated
investment company
VIII. Financial and Statistical Information
54. Information regarding the *30
Trust's past ten fiscal years
55. Certain information regarding *30
periodic payment plan
certificates
56. Certain information regarding *30
periodic payment plan
certificates
57. Certain information regarding *30
periodic payment plan
certificates
58. Certain information regarding *30
periodic payment plan
certificates
59. Financial statements Statement of Financial
(Instruction 1(c) to Form S-6) Condition; Statements of
Operations; Statements of
Changes in Net Assets
<PAGE>
LOGO
DEAN WITTER SELECT
EQUITY TRUST
UTILITY STOCK SERIES 1
(A Unit Investment Trust)
This Trust was formed for the purpose of providing current income
through investment in a fixed portfolio consisting primarily of
publicly traded common stocks, and, to a lesser extent,
cumulative preferred stocks, issued by domestic public utility
companies. The value of the Units of the Trust will fluctuate
with the value of the portfolio of underlying Securities.
Minimum Purchase: 1,000 Units.
The Initial Public Offering of Units in the Trust has been
completed. The Units offered hereby are issued and outstanding
Units which have been acquired by the Sponsor either by purchase
from the Trustee of Units tendered for redemption or in the
Secondary Market.
Sponsor: LOGO DEAN WITTER REYNOLDS INC.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
Read and retain this Prospectus for future reference.
Units of the Trust are not deposits or obligations of, or
guaranteed or endorsed by, any bank, and the Units are not
federally insured by the Federal Deposit Insurance Corporation,
Federal Reserve Board, or any other agency.
Prospectus dated May 22, 1997
<PAGE>
THIS PROSPECTUS DOES NOT CONTAIN ALL OF THE INFORMATION WITH
RESPECT TO THE INVESTMENT COMPANY SET FORTH IN ITS REGISTRATION
STATEMENT AND EXHIBITS RELATING THERETO WHICH HAVE BEEN FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.,
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT
OF 1940, AND TO WHICH REFERENCE IS HEREBY MADE.
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
TABLE OF CONTENTS
Page
Table of Contents . . . . . . . . . . . . . . . . . . A-1
Summary of Essential Information. . . . . . . . . . . A-3
Introduction. . . . . . . . . . . . . . . . . . . . . 1
The Trust . . . . . . . . . . . . . . . . . . . . . . 2
Special Considerations . . . . . . . . . . . . . 2
Summary Description of the Portfolio . . . . . . 3
Certain Risks Affecting Securities
of Utilities Companies . . . . . . . . . . . . 5
Objectives and Securities Selection. . . . . . . 8
Income and Distributions . . . . . . . . . . . . 10
Tax Status of the Trust . . . . . . . . . . . . . . . 11
Public Offering of Units. . . . . . . . . . . . . . . 15
Public Offering Price. . . . . . . . . . . . . . 15
Public Distribution. . . . . . . . . . . . . . . 16
Secondary Market . . . . . . . . . . . . . . . . 16
Profit of Sponsor. . . . . . . . . . . . . . . . 17
Volume Discount. . . . . . . . . . . . . . . . . 17
Exchange Option . . . . . . . . . . . . . . . . . . . 18
The Trust Reinvestment Program. . . . . . . . . . . . 20
Redemption. . . . . . . . . . . . . . . . . . . . . . 22
Right of Redemption. . . . . . . . . . . . . . . 22
Computation of Redemption Value. . . . . . . . . 24
Postponement of Redemption . . . . . . . . . . . 25
Rights of Unit Holders. . . . . . . . . . . . . . . . 25
Unit Holders . . . . . . . . . . . . . . . . . . 25
Certain Limitations. . . . . . . . . . . . . . . 26
Expenses and Charges. . . . . . . . . . . . . . . . . 26
Fees . . . . . . . . . . . . . . . . . . . . . . 26
Other Charges. . . . . . . . . . . . . . . . . . 27
Administration of the Trust . . . . . . . . . . . . . 28
Records and Accounts . . . . . . . . . . . . . . 28
Distributions. . . . . . . . . . . . . . . . . . 28
Portfolio Supervision. . . . . . . . . . . . . . 29
Reports to Unit Holders. . . . . . . . . . . . . 31
Amendment. . . . . . . . . . . . . . . . . . . . 32
Termination. . . . . . . . . . . . . . . . . . . 33
Resignation, Removal and Liability. . . . . . . . . . 33
Regarding the Trustee. . . . . . . . . . . . . . 33
Regarding the Sponsor. . . . . . . . . . . . . . 34
Miscellaneous . . . . . . . . . . . . . . . . . . . . 35
Sponsor. . . . . . . . . . . . . . . . . . . . . 35
Trustee. . . . . . . . . . . . . . . . . . . . . 35
Legal Opinions . . . . . . . . . . . . . . . . . 35
Auditors. . . . . . . . . . . . . . . . . . . . . . . 36
Independent Auditors' Report. . . . . . . . . . . . . F-1
Sponsor:
Dean Witter Reynolds Inc.
Two World Trade Center
New York, New York 10048
Trustee:
The Chase Manhattan Bank
270 Park Avenue
New York, New York 10071
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS WITH RESPECT TO THIS INVESTMENT COMPANY NOT
CONTAINED IN THIS PROSPECTUS; AND ANY INFORMATION OR
REPRESENTATION NOT CONTAINED HEREIN MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO BUY, SECURITIES
IN ANY STATE TO ANY PERSON TO WHOM IT IS NOT LAWFUL TO MAKE SUCH
OFFER IN SUCH STATE.
<PAGE>
<TABLE>
<CAPTION>
SUMMARY OF ESSENTIAL INFORMATION
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
As of March 31, 1997
Number of Units ..........................................................................34,424,254
Fractional Undivided Interest in the Trust Represented by Each Unit ......................1/34,424,254
Public Offering Price Per 1,000 Units:
Aggregate Value of Securities in the Trust ...........................................$31,064,905.00
Divided by 34,424,524 Units (times 1,000) ............................................$ 902.41
Plus Sales Charge<F1> of 4.25% of Public Offering Price (4.439% of net amount invested
in Securities) ..................................................................... 40.06
Public Offering Price per 1,000 Units ................................................ 942.47
Plus amount per 1,000 Units of Undistributed Principal and Net Investment Income ..... 9.16
Total ...........................................................................$ 951.63
Sponsor's Repurchase Price per 1,000 Units and Redemption Price per 1,000 Units (based
on the value of the underlying Securities, $40.06 less than the Public Offering
Price per 1,000 Units) plus undistributed principal and net investment income ........$ 911.57
<S> <S> <C>
Evaluation Time ............................. Close of trading on the New York Stock Exchange
(currently 4:00PM New York time).
Monthly Record Dates ........................ The first day of each month.
Monthly Distribution Dates .................. The fifteenth day of each month.
Minimum Capital Distribution Amount ......... No distribution (other than capital gain
distribution) need be made from the Capital
Account if the balance therein is less than
$5.00 per 1,000 Units outstanding.
Mandatory Termination Date .................. January 1, 2012.
Discretionary Liquidation Amount ............ The Trust may be terminated by the Sponsor if
the value of the Portfolio of the Trust at any
time is less than $31,213,941.
Trustee's Fee (including estimated expenses). $2.15 per 1,000 Units.
Sponsor's Annual Portfolio Supervision Fee .. Maximum of $.25 per 1,000 Units.
<F1>Volume purchasers of Units are entitled to a reduced sales charge. See: "Public Offering of Units -
Volume Discount" in this Prospectus.
A-3
</TABLE>
<PAGE>
SUMMARY OF ESSENTIAL INFORMATION
(Continued)
THE TRUST -- The Dean Witter Select Equity Trust,
Utility Stock Series 1 (the "Trust") is a unit investment trust
composed primarily of dividend paying publicly traded common and,
to a lesser extent, preferred stocks issued by domestic public
utility companies (the "Securities"). The objective of the Trust
is the current receipt of income. The payment of dividends on
the Securities in the Trust is dependent on the amounts made
available by each issuer for distribution and the decisions of
its board of directors. Declaration of dividends will generally
depend upon several factors, including the financial condition of
the issuers and general economic conditions. Therefore, there is
no guarantee that the objective of the Trust will be achieved.
Investors should also be aware that as a result of the Trust's
investment in companies whose principal business activities fit
into one sector of the market, an investment in the Trust can be
expected to experience greater fluctuations in value than other
trusts which invest in a broader range of industries and market
segments. Under certain circumstances, the Sponsor may direct
the Trustee to reinvest certain surplus moneys in the Capital
Account in additional Securities.
MONTHLY DISTRIBUTIONS -- Monthly distributions of
income (but not capital gains) received by the Trust will be made
on or shortly after the fifteenth day of each month.
Alternatively, Unit Holders may elect to have their monthly
distributions reinvested in the Trust Reinvestment Program (see:
"The Trust Reinvestment Program"). Distributions of net realized
capital gains, if any, will be made annually within 30 days of
the end of the Trust's taxable year (see: "Administration of the
Trust -- Distributions").
PUBLIC OFFERING PRICE -- The Public Offering Price per
1,000 Units is calculated daily, computed on the basis of the
aggregate evaluation of the underlying Securities next computed
after receipt of a purchase order divided by the number of Units
outstanding times 1,000, plus a sales charge of 4.439% of such
evaluation per 1,000 Units (the net amount invested); this
results in a sales charge of 4.25% of the Public Offering Price.
The sales charge is reduced on a graduated scale for sales
involving at least $100,000 (see: "Public Offering of Units --
Volume Discount").
MARKET FOR UNITS -- The Sponsor, though not obligated
to do so, intends to maintain a market for the Units. If such
market is not maintained, a Unit Holder will be able to dispose
of its Units through redemption at prices based on the aggregate
value of the underlying Securities (see: "Redemption"). Market
conditions may cause such prices to be greater or less than the
amount paid for Units.
SPECIAL CONSIDERATIONS -- An investment in Units of the
Trust should be made with an understanding of the risks inherent
in an investment in common stocks, including risks associated
with the rights of holders of common stock to receive payments
from issuers; such rights are inferior to those of creditors and
holders of debt obligations or preferred stock. Additionally,
holders of common stock have rights to receive dividends only
when, as and if declared by the issuer's board of directors.
Because the common stocks in the Portfolio have been chosen for
their high current income, it is unlikely that such securities
will experience significant dividend growth during the life of
the Trust. Investors should also be aware that the value of the
underlying Securities in the Portfolio may fluctuate in
accordance with changes in the value of common stocks generally
and changes in the value of common stocks of the public utility
industry in particular. The Trust is considered to be
concentrated in gas and electric public utility stocks (100% of
the aggregate market value of the Trust). In addition, the
issuers of all of the Securities in the Portfolio face
construction, regulatory, operating and financial risks
associated with the construction and operation of nuclear
generating facilities. (See: "The Trust -- Special
Considerations" and "The Trust -- Summary Description of the
Portfolio".)
In addition to the risks inherent in the investment in
any trust containing equity securities such as those discussed
above, there are certain risks involved in investing in the Trust
due to its concentration in stocks of one industry. The Trust's
concentration in securities of a single or several industry
sectors means that the Trust's performance is closely related to
the specific industry conditions as well as general market
conditions experienced in all sectors of the economy as a whole.
As a result, changes in the economic conditions affecting the
selected sectors will tend to have a greater impact on the value
of Units of this Trust than on Units of trusts which invest in a
broader based portfolio of stocks. These factors may result in a
potentially greater return, but may also tend to make the value
of the Units more volatile than other investments. An increase
in market interest rates may result in a decline in value of the
Securities in the Portfolio of the Trust.
SPECIAL CHARACTERISTICS OF THE TRUST -- The Portfolio
of the Trust consists of twenty-one (21) issues of Securities:
all twenty-one (21) of which are common stocks (100% of the
aggregate market value of the Trust on April 30, 1997). All
twenty-one issues of Securities were issued by gas and electric
public utilities companies. (See: "The Trust -- Summary
Description of the Portfolio" and "Schedule of Portfolio
Securities".)
The Trust will be terminated and liquidated on
January 1, 2012, regardless of market conditions at that time
(See Administration of the Trust -- Termination").
On April 30, 1997, the aggregate market value of the
Securities in the Trust was $29,646,160.73, including cash.
MINIMUM PURCHASE -- 1,000 Units.
<PAGE>
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
INTRODUCTION
The Dean Witter Select Equity Trust, Utility Stock
Series 1 (the "Trust") was created on April 2, 1987 (the "Date of
Deposit"), by deposit of certain securities (the "Securities")
under the laws of the State of New York pursuant to a Trust
Indenture (the "Indenture") and a Standard Terms and Conditions
of Trust (the "Agreement") (collectively, the "Indenture and
Agreement"), between Dean Witter Reynolds Inc. (the "Sponsor")
and United States Trust Company of New York (the "Trustee"). The
Sponsor is a principal operating subsidiary of Dean Witter,
Discover & Co. ("DWDC"), a publicly-held corporation. (See:
"Miscellaneous -- Sponsor", herein.) The purpose and objective
of the Trust is to provide current income through investment in a
fixed portfolio of Securities (the "Portfolio") consisting of
dividend paying publicly traded common stock and preferred stock
issued by domestic public utility companies. There is no
assurance that this objective will be met because the payment of
dividends is dependent upon the amount each issuer has available
for distribution and the decisions of its board of directors.
The Trust was created simultaneously with the deposit
of the Securities by the Sponsor with the Trustee and the
execution of the Indenture and Agreement. The Trustee then
immediately delivered to the Sponsor certificates of beneficial
interest (the "Certificates") representing the units (the
"Units") comprising the entire ownership of the Trust. Through
this Prospectus, the Sponsor is offering the Units for sale to
the public. The holders of Certificates (the "Unit Holders")
will have the right to have their Units redeemed at a price based
on the market value of the Securities (the "Redemption Value") if
they cannot be sold in the over-the-counter market which the
Sponsor, although not obligated to, proposes to maintain.
On April 30, 1997, each Unit represented the fractional
undivided interest in the Securities and net income of the Trust,
set forth under "Summary of Essential Information". Thereafter,
if any Units are redeemed, the amount of Securities in the
Portfolio will be reduced, and the fractional undivided interest
represented by each remaining Unit in the balance of the Trust
will be increased. However, if additional Units are issued by
the Trust the aggregate value of the Securities in the Portfolio
will be increased by amounts allocable to such additional Units
and the fractional undivided interest in the balance will be
decreased. In both cases, the actual interest in the Trust
represented by each Unit will remain unchanged. Units will
remain outstanding until redeemed upon tender to the Trustee by
any Unit Holder (which may include the Sponsor) or until the
termination of the Trust pursuant to the Indenture and Agreement.
Additional Units may be issued after the initial Date
of Deposit in respect of additional Securities deposited in the
Trust by the Sponsor and the reinvestment of distributions of the
Trust (see: "The Trust Reinvestment Program"). Because of
possible market fluctuations, the purchase price to the Trust of
such additional Securities may differ from the original purchase
price of the Securities in the Portfolio. If such additional
Securities are purchased at a higher price than the Securities
originally deposited, then the amounts includible in the taxable
income of the Trust in proportion to the asset value of the Trust
will be reduced for all Unit Holders, not just the Unit Holders
of such additional Units. Conversely, if such additional
Securities are purchased at a lower price than the Securities
originally deposited, then the amounts includible in the taxable
income of the Trust in proportion to the asset value of the Trust
will be increased for all Unit Holders not just the Unit Holders
of such additional Units.
From July 14, 1987 to November 3, 1989, the calculation
of the Public Offering Price and the Redemption Value per Unit
was in error. In addition, in the past, certain Unit Holders may
have received distributions from the Income Account which
exceeded the proper amount due them. However, the Trustee has
concluded that neither the error nor the over-distribution had a
material effect on the financial condition of the Trust or the
amount of the Public Offering Price or the Redemption Value per
Unit. It is possible that the Trustee may seek reimbursement
from such Unit Holders in the form of a reduction in the current
and future distributions from the Income Account.
THE TRUST
Special Considerations
An investment in Units of the Trust should be made with
an understanding of the risks which an investment in publicly-
traded common and preferred stock issued by domestic utility
companies may entail, including the risk that the value of the
Portfolio and hence of the Units will decline with decreases in
the market value of the Securities. The Trust will be
terminated and liquidated on the Mandatory Termination Date, as
set forth under "Summary of Essential Information", and the
Securities will be sold, regardless of market conditions at that
time. The Trust may be terminated earlier under certain
conditions (see: "Administration of the Trust -- Termination").
Summary Description of the Portfolio
As used herein, the terms "Common Stocks" and
"Preferred Stocks" refer to the common stocks and the preferred
stocks, respectively, deposited in the Trust and described under
"Schedule of Portfolio Securities". The term "Securities" refers
to the Common Stocks and the Preferred Stocks and any additional
common and preferred stocks subsequently acquired by the Trust
pursuant to the Indenture and Agreement.
An investment in Units of the Trust should be made with
an understanding of the risks inherent in an investment in equity
securities, including risks arising from the fact that holders of
common and preferred stocks have rights to receive payments from
the issuers of those stocks that are generally inferior to those
of creditors of, or holders of debt obligations issued by, such
issuers. Furthermore, the rights of holders of common stocks
generally are inferior to the rights of holders of preferred
stocks. Holders of common stocks of the type held in the
Portfolio have a right to receive dividends only when and if, and
in the amounts, declared by the issuer's board of directors and
to participate in amounts available for distribution by the
issuer only after all other claims on the issuer have been paid
or provided for. By contrast, holders of preferred stocks have
the right to receive dividends at a fixed rate when and as
declared by the issuer's board of directors, normally on a
cumulative basis, but do not participate in other amounts
available for distribution by the issuing corporation.
Cumulative preferred stock dividends must be paid before common
stock dividends, and any cumulative preferred stock dividend
omitted is added to future dividends payable to the holders of
such cumulative preferred stock. Preferred stocks are also
entitled to rights on liquidation which are senior to those of
common stocks. For these reasons, preferred stocks entail less
risk than common stocks. However, neither preferred nor common
stocks represent an obligation or liability of the issuer and
therefore do not offer any assurance of income or provide the
degree of protection of capital of debt securities. The issuance
of debt securities (as compared with both preferred and common
stock) and preferred stock (as compared with common stock) will
create prior claims for payment of principal and interest (in the
case of debt securities) and dividends and liquidation
preferences (in the case of preferred stock) which could
adversely affect the ability and inclination of the issuer to
declare or pay dividends on its common stock or the rights of
holders of common stock with respect to assets of the issuer upon
liquidation or bankruptcy. Further, unlike debt securities which
typically have a stated principal amount payable at maturity
(which value will be subject to market fluctuations prior
thereto), or preferred stocks which typically have liquidation
preference and which may have stated optional or mandatory
redemption provisions, common stocks have neither a fixed
principal amount nor a maturity date and have values which are
subject to market fluctuations for as long as the common stocks
remain outstanding. The value of the securities in the Portfolio
thus may be expected to fluctuate over the entire life of the
Trust. The Sponsor may direct the Trustee to dispose of
securities and purchase substitute securities under certain
specified circumstances (see: "Administration of the Trust --
Portfolio Supervision"). However, Securities may not be disposed
of solely as a result of normal fluctuations in market value.
Payment and Life of the Preferred Stocks in the Trust.
Because certain of the preferred stocks included in the Portfolio
from time to time may be redeemed or may be sold under certain
circumstances described herein, no assurance can be given that
the Trust will retain for any length of time its present size,
composition and return. (See: "Redemption" and "Administration
of the Trust -- Portfolio Supervision".) Many of these preferred
stocks may be subject to redemption prior to their stated final
redemption date pursuant to optional refunding or sinking fund
redemption provisions or otherwise. In general, optional
refunding redemption provisions are more likely to be exercised
when the value of a preferred stock is at a premium over par or
stated value than when it is at a discount from par or stated
value. Generally, the value of a preferred stock will be at a
premium over par or stated value when market interest rates fall
below the rate of return on the stocks. Certain preferred stocks
in the Portfolio may be subject to redemption pursuant to sinking
fund provisions early in the life of the Trust. These provisions
are designed to redeem a significant portion of an issue
gradually over the life of the issue; obligations to be redeemed
are generally chosen by lot or redeemed proportionately. The
"Schedule of Portfolio Securities" contains a listing of the
sinking fund and optional redemption provisions with respect to
the preferred stocks. The Indenture authorizes, but does not
require, the Sponsor, as part of its administrative function, to
instruct the Trustee to reinvest amounts realized from the
redemption of any preferred stock in substitute Securities (see:
"Administration of the Trust -- Portfolio Supervision").
Certain Risks Affecting Securities of Utilities Companies
Revenues of issuers in the utilities industry are
typically derived from power generating facilities, and include
revenues from the sale of electricity generated and distributed
by power agencies using hydroelectric, nuclear, fossil fuel or
other power sources. Certain aspects of the operation of such
facilities, particularly with regard to generation and
transmission at the wholesale level, are regulated by the Federal
Energy Regulatory Commission ("FERC"); more extensive regulation
(affecting retail rate structures) is provided by state public
service commissions. Special risk considerations include:
restrictions on operations and increased costs and delays
attributable to environmental statutes and regulations; the
difficulties of the utilities in financing or refinancing large
construction programs and of the capital markets in absorbing
utility debt and equity securities; fluctuations in fuel supplies
and costs, and costs associated with conversion to alternate fuel
sources; uncertainties with regard to demand projections due to
changing economic conditions, implementation of energy
conservation measures and competitive cogeneration projects; and
other technical and cost factors. Scientific breakthroughs in
fusion energy and superconductive materials could cause current
technologies for the generation and transmission of electricity
to become obsolete during the life of the Securities. Issuers
relying upon hydroelectric generation may encounter contests when
applying for periodic renewal of licenses from FERC to operate
dams. Issuers relying upon coal as a fuel source may be subject
to significant costs and operating restrictions to comply with
emission standards which have been adopted to alleviate the
problems associated with acid rain. Issuers relying upon fossil
fuel sources and located in air quality regions designated as
nonattainment areas may become subject to pollution control
measures (which could include abandonment of construction
projects in progress, plant shutdowns or relocation of
facilities) ordered pursuant to the Clean Air Act. In addition,
Securities of Utilities Companies are sometimes secured by
payments to be made to state and local joint action power
agencies pursuant to "take or pay" agreements. The inability of
an Issuer to pass on certain of its costs to its customers,
whether due to government regulation, judicial decisions or for
other reasons, may have a negative impact on the financial
standing of such Issuer and, therefore, may have a negative
impact on the Securities of such Issuer contained in the Trust.
In addition, the Clean Air Act, affects nearly all electric power
facilities that burn oil or coal. Current and future
environmental legislation, regulations or other governmental
actions may increase the cost of utility service. The Sponsor is
unable to predict the ultimate form that any such future
legislation, regulations or other governmental action may take or
the resulting impact on the Securities.
Some of the issuers of Securities in the Portfolio may
own, operate or participate on a contractual basis with nuclear
generating facilities, which are licensed and regulated by the
Nuclear Regulatory Commission (the "NRC"). Nuclear generating
projects have experienced substantial cost increases,
construction delays and licensing difficulties. Issuers of
Securities may incur substantial expenditures as a result of
complying with NRC requirements. Additional considerations
include: the frequency and duration of plant shutdowns and
associated costs due to maintenance or safety considerations; the
problems and associated costs related to the use and disposal of
radioactive materials and wastes in compliance with Federal and
local law; the implementation of emergency evacuation plans for
areas surrounding nuclear facilities; and other issues associated
with construction, licensing, regulation, operation and eventual
decommissioning of such facilities. These Securities may be
subject to industry-wide fluctuations in market value as a
consequence of market perception of certain highly publicized
events, as in the Washington Public Power Supply System's
defaults on its Project 4 and 5 revenue bonds and the 1988
bankruptcy filing by the Public Service Corporation of New
Hampshire. Federal, state or municipal government authorities,
or voters by initiative, may from time to time impose additional
regulations or take such other governmental action which might
cause delays in the licensing, construction or operation of
nuclear power plants, or the suspension or cessation of
operations of facilities which have been or are being financed by
proceeds of certain Securities. Such delays, suspensions or
other action may affect the payments on such Securities.
Gas and Electric Public Utility Industry. The Trust is
considered to be "concentrated" in stocks of the gas and electric
public utility industry. In view of this, an investment in the
Trust should be made with an understanding of the problems
inherent in that industry. Utilities are generally subject to
extensive regulation by state utility commissions which, for
example, establish the rates which may be charged and the
appropriate rate of return on an approved asset base, which must
be approved by the state commissions. Certain utilities have had
difficulty from time to time persuading regulators, who are
subject to political pressures, to grant rate increases necessary
to maintain an adequate return on investment and voters in many
states have the ability to impose limits on rate adjustments (for
example, by initiative or referendum). Any unexpected
limitations could negatively affect the profitability of
utilities whose budgets are planned far in advance. Also,
changes in certain accounting standards implemented by the
Financial Accounting Standards Board could cause significant
write-downs of assets and reductions in earnings for many
investor-owned utilities. Certain of the issuers of the
Securities in the Portfolio may own or operate nuclear
generating facilities. Governmental authorities may from time to
time review existing, and impose additional, requirements
governing the licensing, construction and operation of nuclear
power plants. In addition, gas pipeline and distribution
companies have had difficulties in adjusting to short and surplus
energy supplies, enforcing or being required to comply with long-
term contracts and avoiding litigation from their customers, on
the one hand, or suppliers, on the other. Other problems include
difficulty in financing large construction programs during
inflationary periods, rising costs of transportation to transport
fossil fuels, the uncertainty of transmission service costs,
changes in tax laws which may adversely affect a utility's
ability to operate in a profitable manner, recent reductions in
estimates for future demand for electricity and gas in certain
regions, uncertain availability and increased cost of capital,
steady rises in fuel costs and costs associated with converting
to alternate sources of fuel for electric generation,
restrictions on operations and increased costs and delays
attributable to environmental considerations and regulations,
difficulty of raising capital in adequate amounts on reasonable
terms in periods of high inflation and unsettled capital markets,
the greatly increased costs and reduced availability of certain
types of fuel, the occasionally reduced availability and high
cost of natural gas for resale, the effects of energy
conservation, the effects of a national energy policy and lengthy
delays and greatly increased costs. Other problems include those
associated with the design, construction, licensing, regulation
and operation of nuclear facilities for electric generation
(particularly in the aftermath of the Three Mile Island
incident), such as the problems associated with the use of
radioactive materials and the disposal of radioactive wastes.
There are substantial differences between the regulatory policies
and practices of various jurisdictions, and any given regulatory
agency may make major shifts in policy from time to time. There
is no assurance that regulatory authorities will in the future
grant rate increases or that any such increases will be adequate
to permit the payment of dividends on common stocks.
Additionally, existing and possible future regulatory legislation
may make it even more difficult for these utilities to obtain
adequate rate relief. The National Energy Policy Act (the "Act")
is expected to have a significant impact on the electric utility
industry. The Act provides increased access to electric
transmission systems by independent power producers and other
suppliers and purchasers of electricity. These changes are
expected to increase competition in the energy supply and
generation business. Such increased competition may result in a
reduction in the income of the issuers of the Securities in the
portfolio, the value of such Securities, such issuers ability to
pay dividends and a decline of the economic viability of such
issuers.
Each of the problems referred to above could adversely
affect the ability and the inclination of public utilities to
declare or to pay dividends and the ability of holders of common
stock to realize any value from the assets of the issuer upon
liquidation or bankruptcy. All of the electric and gas utilities
which are issuers of the Securities in the Trust Portfolio have
been experiencing one or more of these problems in varying
degrees. Moreover, price disparities within selected utility
groups and discrepancies in relation to averages and indices have
occurred frequently for reasons not directly related to the
general movement of price levels of utility common stocks.
Causes of these disparities and discrepancies include changes in
the overall demand for or supply of various securities (including
the potentially depressing effect of new stock offerings), and
changes in investment objectives, market expectations or cash
requirements of other purchasers and sellers of securities.
The Public Utility Holding Company Act of 1935 (the
"1935 Act") regulates, among other things, certain acquisitions
of voting securities of electric utility companies and gas
utility companies by any one who is an "affiliate" of a public
utility company (a person or organized group of persons that
directly or indirectly owns, controls or holds with power to vote
5% or more of the outstanding voting securities of a public
utility company). In addition, the 1935 Act requires a "holding
company" (among other categories, a company which directly or
indirectly owns, controls or holds with power to vote 10% or more
of the outstanding voting securities of a public utility company
or a "holding company") to register as such with the Securities
and Exchange Commission and be otherwise subject to certain
restrictions on the acquisition of securities and other interests
in public utility companies. In order to avoid becoming an
"affiliate", the Dean Witter Select Equity Trust has adopted an
investment restriction that it will not purchase securities of a
public utility company if by reason thereof the Dean Witter
Select Equity Trust, including this and all prior and subsequent
series of the Dean Witter Select Equity Trust, would hold 5% or
more of the outstanding voting securities of the issuer.
Nevertheless, if the Dean Witter Select Equity Trust were
considered to be a member of an organized group of persons, the
1935 Act might limit the Dean Witter Select Equity Trust's
acquisitions of the voting securities of public utility companies
by reason of the control by the group of 5% or more of the voting
securities of a public utility company. The Sponsor believes
that even if this and all subsequent series of the Dean Witter
Select Equity Trust are appropriately included in a group, it is
unlikely that the holdings of such group will aggregate as much
as 5% of the voting securities of any public utility company.
Objectives and Securities Selection
The objective of the Trust is the current receipt of
income through an investment in a fixed diversified portfolio of
Securities. There is, of course, no guarantee that the Trust's
objective will be achieved.
In selecting the Common and Preferred Stocks for
deposit in the Portfolio of the Trust on the Date of Deposit, the
following factors, among others, were considered by the Sponsor:
(i) the quality of the Common and Preferred Stocks (based upon
the Sponsor's judgment as to the possible risk of dividend
impairment and as to the potential for dividend growth taking
into account an appraisal relating to the maintenance and growth
of earnings in the light of the past performance of the issuer),
(ii) the yield and price of the Common and Preferred Stocks
relative to other public utility common stocks of comparable
quality and (iii) the variety of the utility stocks in the
Portfolio, taking into account the availability in the market of
utility issues which meet the Trust's quality, yield and price
criteria.
The yield and price of utility common stocks of the
type deposited in the Trust are dependent on a variety of
factors, including money market conditions, general conditions of
the corporate bond and equity markets, size of a particular
offering and capital structure of the issuer. Each issuer of
Securities has paid a cash dividend on its common stock
continually for several years. However, as discussed above,
continued payment of, or increase or decrease in, dividends is
voluntary and subject to many factors and thus cannot be assured.
(See: "Schedule of Portfolio Securities" for information with
respect to the percentage of the Portfolio represented by each
Common and Preferred Stock.) Throughout the life of the Trust it
is expected that these Portfolio percentages will be maintained
as far as practicable (subject to adjustment as stated in
"Administration of the Trust -- Portfolio Supervision").
Therefore, each Unit will continue to represent a fractional
undivided interest in a portfolio of substantially the same
securities subject to such adjustment.
The Trust consists of the Securities listed under
"Schedule of Portfolio Securities", as may continue to be held
from time to time in the Trust, and any additional and substitute
Securities acquired and held by the Trust pursuant to the
provisions of the Indenture (including provisions with respect to
the reinvestment of Trust distributions of Unit Holders who have
elected such reinvestment), together with undistributed income
therefrom and undistributed and uninvested cash realized from the
disposition of Securities (see: "Administration of the Trust").
Neither the Sponsor nor the Trustee shall be liable in any way
for any default, failure or defect in any of the Securities.
Because certain Securities from time to time may be
sold or their percentage reduced under certain circumstances
described herein, no assurance can be given that the Trust will
retain for any length of time its present size and composition
(see: "Administration of the Trust -- Portfolio Supervision").
The Indenture authorizes, but does not require, the Sponsor, as
part of its administrative function, to instruct the Trustee to
reinvest the net proceeds of the sale of Securities in substitute
Securities to the extent that such proceeds are not required for
the redemption of Units.
The Trust is organized as a unit investment trust and
not as a management investment company. Therefore, neither the
Trustee nor the Sponsor has the authority to manage the Trust's
assets fully in an attempt to take advantage of various market
conditions to improve the Trust's net asset value and, further,
the Securities in the Portfolio may be disposed of only under
limited circumstances. (See: "Administration of the Trust --
Portfolio Supervision".)
Income and Distributions
The net annual income per 1,000 Units is determined by
subtracting from the annual dividend income of the Securities in
the Trust Portfolio the estimated annual expenses (total
estimated annual Trustee's, Sponsor's and administrative fees and
expenses) and dividing by the number of Units outstanding times
1,000. The net annual income per 1,000 Units will change as the
issuers of the Securities change their dividend rate, as the
Securities are sold, as substitute or additional Securities are
purchased, or as the expenses of the Trust change.
There is no assurance that any dividends will be
declared or paid in the future on the Securities currently on
deposit or to be deposited subsequently in the Trust.
Record Dates are the first day of each month and
Distribution Dates are the fifteenth day of each month (or the
next business day thereafter if the fifteenth is not a business
day). The monthly distribution per Unit will be an amount equal
to approximately one-twelfth of the amount of the estimated net
annual dividend income per Unit to be received by the Trust
during the ensuing twelve months and will be distributed on or
shortly after each Distribution Date to Unit Holders of record on
the preceding Record Date. Distributions of net realized capital
gain, if any, will be made annually, within 30 days after the end
of the Trust's taxable year. Under certain circumstances, the
Trustee may make additional distributions in any calendar year
in order to avoid the imposition of Federal or state excise taxes
or to continue or otherwise maintain the Trust's qualification as
a regulated investment company under subchapter M of the Internal
Revenue Code of 1986, as amended (see: "Tax Status of the
Trust").
Distributions for any Unit Holder of record who has not
elected to participate in the Trust's Reinvestment Program (see:
"The Trust Reinvestment Program") shall automatically be mailed
to such holder. Distributions for the account of beneficial
owners of Units registered in "street name" and held by the
Sponsor shall be made to the investment account of such
beneficial owners maintained with the Sponsor. Beneficial owners
who wish to receive distributions on Units directly from the
Trustee must have such Units registered in their own names.
Normally, dividends on the Securities in the Trust are
paid on a quarterly basis. Further, because dividends on the
Securities are not received by the Trust at a constant rate
throughout the year, any monthly distribution made by the Trustee
may be more or less than the amount credited to the Income
Account as of the Record Date. In order to eliminate
fluctuations in distributions resulting from such variances, the
Trustee is required by the Indenture to advance such amounts as
may be necessary to provide distributions of approximately equal
amounts, subject to monthly adjustments by the Trustee to reflect
dividends actually being paid. The Trustee will be reimbursed,
without interest, for any such advances from funds available from
the Income Account on the next ensuing Record Date. Funds which
are available for future distributions are held by the Trustee in
non-interest-bearing accounts and are therefore available for use
by, and will be of benefit to, the Trustee.
TAX STATUS OF THE TRUST
The following discussion offers only a brief outline of
the federal income tax consequences of investing in the Trust.
Investors should consult their own tax advisors for more detailed
information and for information regarding the impact of state,
local or foreign taxes upon such an investment.
The Trust has elected and intends to continue to
qualify to be taxed as a regulated investment company under
Subchapter M of the Internal Revenue Code of 1986, as amended
(the "Code"). Generally, to qualify as a regulated investment
company for a taxable year the Trust must derive at least 90% of
its income from certain specified sources, including interest,
dividends, gains from the disposition of securities, and other
income derived with respect to its business of investing in
securities. In addition, the Trust must derive less than 30% of
its gross income from the disposition of securities held for less
than three months, must meet certain diversification criteria
regarding Trust investment, and must distribute annually at least
90% of its investment company taxable income. For any year in
which the Trust qualifies for taxation as a regulated investment
company, (a) the Trust is not taxed on income distributed to its
shareholders in the form of dividends or capital gains
distributions and (b) if the Trust is the record holder of stock
on the record date for a dividend payable with respect to that
stock, the dividend must be included in the gross income of the
Trust as determined for federal income tax purposes on the later
of (1) the date the stock became ex-dividend with respect to such
dividend or (2) the date the Trust acquired the stock. If, in
any taxable year, the Trust were to fail to qualify as a
regulated investment company under the Code, the Trust would be
taxed for that year in the same manner as an ordinary corporation
and distributions to its shareholders would not be deductible by
the Trust in computing its taxable income. In addition, in the
event of a failure to qualify as a regulated investment company
for a taxable year, that year's Trust distributions, to the
extent derived from current or accumulated earnings and profits,
would be taxable to the recipient shareholders as ordinary income
dividends, even if those distributions might otherwise have been
considered distributions of capital gains.
If the Trust fails to distribute in each calendar year
at least (i) 98% of its ordinary income for such calendar year
and (ii) 98% of its capital gain net income (both long-term and
short-term) for the 12 months ended October 31 of such calendar
year (or December 31, if the Trust qualifies to so elect and does
so), the Trust will be subject to a 4% excise tax on
undistributed income if income tax on such income has not been
paid by the Trust. In addition, the Trust will be subject to
such excise tax on any portion (not taxed to the Trust) of the
respective 2% balances which are not distributed during the
succeeding calendar year.
If the Trust fails to qualify as a regulated investment
company for any year, it must pay out its earnings and profits
accumulated in that year (less the interest charge mentioned
below, if applicable) and may be required to pay an interest
charge to the Treasury on 50% of such earnings and profits before
it can again qualify as a regulated investment company.
Generally, distributions paid by the Trust, whether or
not reinvested, are treated as received in the taxable year of
the distribution; however, any amounts designated for
distribution by the Trust with respect to October, November or
December of any calendar year as payable to Unit Holders of
record on a specified date in such month and which are actually
paid during January of the following year, will be treated as
received on December 31 of the preceding year. The Indenture and
Agreement require current distribution to Unit Holders of the
entire net income and net capital gain, if any, of the Trust and
cash proceeds of redemptions, mergers, liquidations of issuers or
sales representing recovery of cost (to the extent that the
proceeds of sales or other dispositions are not reinvested or
used to redeem Units) of underlying Securities in the Trust. In
kind receipts of the Trust in mergers and liquidations may be
either retained or sold and the proceeds, if sold, will be either
(i) distributed to Unit Holders or (ii) retained by the Trustee
with the proceeds of such sale credited to the Income and/or
Capital Accounts and (unless applied for purchase of securities
pursuant to the Indenture) distributed to Unit Holders in the
manner provided in the Indenture. Securities received in a
liquidation or merger will not be retained if such retention
would jeopardize the characterization of the Trust as a regulated
investment company for Federal income tax purposes.
Distributions to Unit Holders (other than capital gain
distributions) will be taxable as ordinary income to such Unit
Holders to the extent paid from interest, dividends, and net
short-term capital gains includible in the Trust's gross income
for the taxable year with respect to which the distribution is
made less the sum of the Trust's allocable deductible expenses.
To the extent that such distributions to a Unit Holder with
respect to any year are not taxable as ordinary income or as
capital gain distributions, the amount of such distributions will
be treated as a return of capital and will reduce the Unit
Holder's basis in his or her Units and, to the extent that they
exceed such Unit Holder's basis, will generally be taxed as a
capital gain.
It is anticipated that part of the distributions of the
Trust will be taxable as ordinary income to Unit Holders and that
substantially all of the distributions which are taxable as
ordinary income to Unit Holders will, under present law,
constitute dividends for purposes of the 70% deduction allowed to
certain corporations with respect to dividends received, as
discussed below. This deduction is allowed to corporations other
than corporations, such as "S" corporations, which are not
eligible for such deduction because of their special
characteristics. Dividends received by corporations are not
deductible for purposes of special taxes such as the accumulated
earnings tax and the personal holding company tax.
Under existing law, only the amount of the Trust's
dividend distributions (exclusive of capital gain dividends) that
are designated as dividends by the Trust and which do not exceed
the aggregate amount of dividends received by the Trust will
qualify for the 70% dividends-received deduction for
corporations. Dividends received by the Trust will be considered
dividends for this purpose only if such dividends would qualify
for the 70% dividends-received deduction if such deduction were
available to regulated investment companies.
Individual investors should note that the Code places a
floor of 2% of adjusted gross income on miscellaneous itemized
deductions, including investment expenses. The Code directs the
Secretary of the Treasury to prescribe regulations prohibiting
indirect deduction through a pass-through entity (such as the
Trust) of amounts not allowable as a deduction under this rule if
paid or incurred directly by an individual.
Temporary regulations applicable to "nonpublicly
offered regulated investment companies" have been issued. Under
these temporary regulations, in general, (i) specified expenses
of the regulated investment company or, at the election of the
regulated investment company, 40% of its expenses, exclusive of
expenses which are specifically excluded from miscellaneous
itemized deductions if incurred by an individual, are allocated
among its shareholders who are "affected investors" (i.e.,
individuals, estates, trusts and pass-through entities having
such shareholders), and (ii) such investors are treated as having
received or accrued dividends in an aggregate amount equal to the
investor's share of such expenses and to have incurred investment
expenses in the same aggregate amount. These computations are
made on a calendar year basis and the allocation of such expenses
among affected investors may be done by the regulated investment
company on any reasonable basis (which basis, if utilizing
distributions to affected investors, may exclude some of such
distributions).
The Code provides, however, that the 2% floor rule will
not apply to indirect deductions through a publicly offered
regulated investment company. The term "publicly offered
regulated investment company" is defined as meaning a regulated
investment company the shares of which are "continuously offered"
or regularly traded on an established securities market or "held
by or for no fewer than 500 persons at all times during the
taxable year." The Sponsor is unable to state whether or not the
Trust will qualify in the future for treatment as a "publicly
offered regulated investment company."
Gain or loss will be realized by each Unit Holder to
the extent that the proceeds of redemption (or distributions
received upon liquidation of his or her Units) exceed or are less
than the Unit Holder's tax cost basis in the Units which are
redeemed (or in respect of which the liquidating distributions
are made). Distributions in kind are taken into account for this
purpose at their fair market value when distributed.
Distributions of net capital gain (designated as such
by the Trust) will be taxable to Unit Holders as long-term
capital gain regardless of the length of time the Units have been
held by a Unit Holder. A redemption of Units will be a taxable
event for a Unit Holder and, depending on the circumstances, may
give rise to gain or loss. Under the Code, net capital gain
(i.e., the excess of net long-term capital gain over net short-
term capital loss) of individuals, estates and trusts is subject
to a maximum nominal tax rate of 28%. Such net capital gain may,
however, result in a disallowance of itemized deductions and/or
affect a personal exemption phase-out.
The Code disallows the dividends-received deduction in
full for corporations with respect to stock, including Trust
Units (which are considered as stock for this purpose), held for
45 days or less (90 days or less in the case of certain
preference stock), exclusive of days on which the holder's risk
of loss is diminished. Sections 246 and 246A of the Code also
contain limitations on the eligibility of dividends for the 70%
dividends-received deduction (in addition to the limitation
discussed above). These limitations may be applicable to
dividends received by a Unit Holder depending on the Unit
Holder's individual circumstances. Accordingly, Unit Holders
which are corporations should consult their own tax advisors in
this regard.
Information with respect to the Federal income tax
status of each year's distributions will be supplied to Unit
Holders.
The Trust is required to withhold U.S. federal income
tax at the rate of 31% of all taxable distributions payable to
holders of Trust Units who fail to provide the Trust with their
correct taxpayer identification numbers or to make required
certifications, or who have been notified by the Internal Revenue
Service that they are subject to backup withholding. Backup
withholding is not an additional tax. Any amounts withheld may
be credited against U.S. federal income tax liability of a holder
of a Trust Unit.
Distributions paid to foreign Unit Holders which do not
constitute income effectively connected with the conduct of a
trade or business within the United States by the distributee
will be subject to United States federal withholding taxes at a
30% rate or a lesser rate established by treaty unless the
distribution is a capital gain dividend. Foreign Unit Holders
should consult their own tax counsel with respect to United
States tax consequences of ownership of Units.
Investors are advised to consult their own tax advisors
with respect to the application to their own circumstances of
the above-described general taxation rules and with respect to
the state, local or foreign tax consequences to them of an
investment in Trust Units.
Units of the Trust may be suited for purchase by
Individual Retirement Accounts and pension plans, profit sharing
and other qualified retirement plans. Investors considering
participation in any such plan should consult their attorneys or
other tax advisors with respect to the establishment and
maintenance of any such plan.
PUBLIC OFFERING OF UNITS
Public Offering Price
The Public Offering Price of the Units is computed by
adding to the aggregate market value of the Portfolio Securities
(as determined by the Trustee) next computed after receipt of a
purchase order, divided by the number of Units outstanding, the
sales charge shown in "Summary of Essential Information". The
Public Offering Price per Unit is calculated to five decimal
places and rounded up or down to three decimal places. A
proportionate share of the amount in the Income Account (other
than money required to be distributed to Unit Holders on a
Distribution Date and money required to redeem tendered Units) on
the date of delivery of Units to the purchaser is added to the
Public Offering Price. The Public Offering Price on any
particular date will vary in accordance with fluctuations in the
market value of the Securities, the amount of available cash on
hand in the Trust and the amount of certain accrued fees and
expenses.
As more fully described in the Indenture, the aggregate
market value of the Securities is determined on each business day
by the Trustee based on closing sale prices on the day the
valuation is made or, if there are no such reported sales, taking
into account the same factors referred to under "Redemption --
Computation of Redemption Value". Determinations are effective
for transactions effected subsequent to the last preceding
determination.
Public Distribution
Units acquired by the Sponsor in the secondary market
referred to below may be offered to the public by this Prospectus
at the then current Public Offering Price determined as provided
above.
The Sponsor intends to qualify Units in states selected
by the Sponsor for sale by the Sponsor and from time to time may
offer Units for sale through dealers who are members of the
National Association of Securities Dealers, Inc.
Secondary Market
While not obligated to do so, it is the Sponsor's
present intention to maintain, at its expense, a secondary market
for Units of this series of the Dean Witter Select Equity Trust
and to continuously offer to repurchase Units from Unit Holders
at the Sponsor's Repurchase Price. The Sponsor's Repurchase
Price is computed by adding to the aggregate value of the
Securities in the Trust any cash on hand in the Trust including
dividends receivable on stocks trading ex-dividend (other than
money required to redeem tendered Units and cash deposited by the
Sponsor to purchase Securities or cash held in the Reserve
Account) and deducting therefrom expenses of the Trustee, the
Sponsor, counsel and taxes, if any, and cash held for
distribution to Unit Holders of record as of a date on or prior
to the evaluation; and then dividing the resulting sum by the
number of Units outstanding, as of the date of such computation.
There is no refund of the sales charge, nor is any additional
sales charge incurred, when a Unit Holder tenders Units. Any
Units repurchased by the Sponsor at the Sponsor's Repurchase
Price may be reoffered to the public by the Sponsor at the then
current Public Offering Price, plus accrued distribution amounts.
Any profit or loss resulting from the resale of such Units will
belong to the Sponsor.
If the supply of Units exceeds demand (or for any other
business reason), the Sponsor may, at any time, occasionally,
from time to time, or permanently, discontinue the repurchase of
Units of this series at the Sponsor's Repurchase Price. In such
event, although under no obligation to do so, the Sponsor may, as
a service to Unit Holders, offer to repurchase Units at the
"Redemption Value". Alternatively, Unit Holders may redeem their
Units through the Trustee.
Profit of Sponsor
The Sponsor receives a sales charge on Units sold to
the public and to dealers. Cash, if any, received by the Sponsor
from the Unit Holders prior to the settlement date for purchase
of Units or prior to the payment for Securities upon their
delivery may be used in the Sponsor's business subject to
applicable regulations and may be of benefit to the Sponsor.
The Sponsor may also realize profits (or sustain
losses) while maintaining a secondary market in the Units, in the
amount of any difference between the prices at which the Sponsor
buys Units and the prices at which the Sponsor resells such Units
(such prices include a sales charge) or the prices at which the
Sponsor redeems such Units, as the case may be.
Volume Discount
Although under no obligation to do so, the Sponsor
intends to permit volume purchasers of Units to purchase Units at
a reduced sales charge. The volume discount is available due to
the realization of economies of scale in sales effort and sales-
related expenses involved in volume purchases. The Sponsor may
at any time change the amount by which the sales charge is
reduced, or may discontinue the discount altogether.
The sales charge is 4.25% of the Public Offering Price
(4.439% of the net amount invested). A discount in the sales
charge is available to volume purchasers of Units due to the
realization of economies of scale in sales effort and sales-
related expenses in volume purchases. The sales charge will be
reduced pursuant to the following graduated scale for sales to
any person of at least $100,000:
Percent of Public Percent of Net
Aggregate Value of Units Offering Price Amount Invested
Less than $100,000 . . . . . . 4.25% 4.439%
$ 100,000 to $249,999 . . . . 4.00% 4.167%
$ 250,000 to $499,999 . . . . 3.50% 3.627%
$ 500,000 to $999,999 . . . . 3.00% 3.093%
$1,000,000 or more . . . . . . 2.00% 2.041%
The reduced sales charges, as shown above, will be
available only on purchases of Units of this Trust on any one day
by the same person, partnership or corporation (other than a
dealer). Concurrent purchases of units of any other Dean Witter
Trust will not be aggregated for purposes of meeting the volume
discount requirement.
Units held in the name of the purchaser's spouse or in
the name of a purchaser's child under the age of 21 are deemed
for the purposes hereof to be registered in the name of the
purchaser. The reduced sales charges are also applicable to a
trustee or other fiduciary, including a partnership or
corporation, purchasing Units for a single trust estate or single
fiduciary account.
EXCHANGE OPTION
Unit Holders of any Dean Witter Trust or any holders of
units of any other unit investment trust (collectively,
"Holders") may elect to exchange any or all of their units of
each series of the Dean Witter Select Equity Trust for units of
one or more of any series of the Dean Witter Select Equity Trust
or for units of any additional Dean Witter Trusts, that may from
time to time be made available for such exchange by the Sponsor
(the "Exchange Trusts"). Such Units may be acquired at prices
based on reduced sales charges per Unit. The purpose of such
reduced sales charges is to permit the Sponsor to pass on to the
Holder who wishes to exchange Units the cost savings resulting
from such exchange of Units. The cost savings result from
reductions in time and expense related to advice, financial
planning and operational expense required for the Exchange
Option. The following Exchange Trusts are currently available:
the Dean Witter Select Municipal Trust, the Dean Witter Select
Government Trust, the Dean Witter Select Equity Trust, the Dean
Witter Select Investment Trust and the Dean Witter Select
Corporate Trust.
Each Exchange Trust has a different investment
objective; a Holder should read the prospectus for the applicable
Exchange Trust carefully to determine the investment objective
prior to exercise of this option.
This option will be available provided the Sponsor
maintains a secondary market in units of the applicable Exchange
Trust and provided that units of the applicable Exchange Trust
are available for sale and are lawfully qualified for sale in the
state in which the Holder is a resident. While it is the
Sponsor's present intention to maintain a secondary market for
the units of all such trusts, there is no obligation on its part
to do so. Therefore, there is no assurance that a market for
units will in fact exist on any given date on which a Holder
wishes to sell or exchange Units; thus, there is no assurance
that the Exchange Option will be available to any Holder. The
Sponsor reserves the right to modify, suspend or terminate this
option at any time without further notice to Unit Holders. In
the event the Exchange Option is not available to a Unit Holder
at the time such Unit Holder wishes to exercise it, the Unit
Holder will be immediately notified and no action will be taken
with respect to its Units without further instruction from the
Unit Holder.
Exchanges will be effected in whole units only. Any
excess proceeds from the surrender of a Unit Holder's Units will
be returned. Alternatively, Unit Holders will be permitted to
make up any difference between the amount representing the Units
being submitted for exchange and the amount representing the
Units being acquired up to the next highest number of whole
Units.
An exchange of Units pursuant to the Exchange Option
will constitute a "taxable event" under the Code, i.e., a Holder
will recognize a gain or loss at the time of exchange. A Unit
Holder who exchanges Units of one Trust for units of another
Trust should consult his or her tax advisor regarding the extent
to which such exchange results in the recognition of a loss for
Federal and/or state or local income tax purposes.
To exercise the Exchange Option, a Unit Holder should
notify the Sponsor of its desire to use the proceeds from the
sale of its Units to purchase units of one or more of the
Exchange Trusts. If units of the applicable outstanding series
of the Exchange Trust are at that time available for sale, the
Holder may select the series or group of series for which such
Units are to be exchanged. The Holder will be provided with a
current prospectus or prospectuses relating to each series in
which interest is indicated.
The exchange transaction will operate in a manner
essentially identical to any secondary market transaction, i.e.,
Units will be repurchased at a price equal to the aggregate bid
side evaluation per Unit of the Securities in the Portfolio, plus
accrued interest. Units of the Exchange Trust will be sold to
the Unit Holder at a price equal to the evaluation per unit of
the securities in that portfolio, plus accrued interest and the
applicable sales charge of $25 per Unit (or per 1,000 Units in
the case of a unit priced at about $1.00) or 2.5% of the Public
Offering Price where the cost per Unit is significantly less than
$1.00. If a Unit Holder has held its Units for less than a five-
month period, the sales charge shall be the greater of (i) $25 or
(ii) the difference between the original sales charge on the
Units owned and the sales charge on the Exchange Trust.
THE TRUST REINVESTMENT PROGRAM
Distributions of income are made to Unit Holders
monthly and distributions of capital gain net income are made
annually. The Unit Holder has the option, however, of either
receiving its monthly income and annual capital gain checks from
the Trustee or participating in the reinvestment program (the
"Program"), described briefly below. Participation in the
reinvestment program is conditioned on such Program's lawful
qualification for sale in the state in which the Unit Holder is a
resident. Upon enrollment in the reinvestment program, the
Trustee will direct monthly income distributions and capital and
net capital gains distributions, if any, as described below.
A Unit Holder (including any Unit Holder which is a
broker or nominee of a bank or other financial institution) may
indicate to the Trustee or by notice to the Unit Holder's account
executive or sales representative, that such Unit Holder wishes
monthly distributions to be automatically invested in additional
Units of the Trust. The Unit Holder's completed notice of
election to participate in the Program must be received by the
Trustee at least ten days prior to the Record Date applicable to
any distribution in order for the Program to be in effect as to
such distribution. Distributions, to the extent reinvested in
the Trust, will be used by the Trustee at the direction of the
Sponsor to credit additional Units to each participating Unit
Holder's account. Additional Units will be made available in the
following manner: the Trustee will use the distributions either
(1) to purchase existing Units from the Sponsor, to the extent
they are available, or (2) to purchase additional Securities in
proportions sufficient to maintain, as closely as practicable,
the proportionate relationship between the number of shares of
each Security in the Trust immediately prior to the purchase. In
the event that contracts to purchase such additional Securities
fail, the Sponsor shall have the ability to direct the Trustee to
purchase substitute Securities from the list maintained by it
with the Trustee. The additional Securities so purchased will be
the basis for the Trustee to issue new Units to Unit Holders
participating in the Program. Purchases made pursuant to the
Program will be at the applicable Public Offering Price for Units
of the Trust, less the sales charge, on (or as soon as possible
after) the close of business on the Distribution Date. Under the
Program, the Trust will pay the distributions to the Trustee
which in turn will purchase for the Unit Holder full Units of the
Trust at the price and time indicated above. Unit Holders
participating in the Program who have accounts at Dean Witter
will receive information regarding their participation in the
Program directly from Dean Witter rather than from the Trustee.
Those Unit Holders holding definitive Certificates for Units will
receive information regarding their participation in the Program
from the Trustee. Any Unit Holders who do not currently maintain
an account at Dean Witter and are holding definitive Certificates
may contact a local Dean Witter Reynolds sales office about
establishing an account.
The Trustee will issue Certificates for whole Units
purchased through the Program only if the Unit Holder so
requests. Certificates will not be issued for fractional Units
under any circumstances. If, after the maximum number of full
Units have been issued or credited at the applicable price, there
remains a portion of the distribution which is not sufficient to
purchase a full Unit at such price, the Trustee shall hold such
cash, without interest, for the benefit of such Unit Holder and
shall apply such cash on the next Distribution Date, along with
any distributions then made, toward the purchase of additional
full Units in accordance with the Program. When Certificates are
not issued directly to the Unit Holder, Dean Witter will credit
each Unit Holder's account with the number of Units purchased
with such Unit Holder's reinvested distribution. Each Unit
Holder will receive account statements both annually and after
each Program transaction to provide the Unit Holder with a record
of the total number of Units. Participation in the Program
relieves the Unit Holder of responsibility for safekeeping of
Certificates for Units purchased under the Program, and, should
such Unit Holder sell such Units, eliminates the need to deliver
Certificates. The Unit Holder may at any time request the
Trustee (at the Trust's cost) to issue Certificates for full
Units purchased under the Program. The cost of administering the
Program will be borne by each participant and such cost will be
deducted from such Unit Holder's distribution amount prior to the
purchase of its additional Units.
In the event that, during the period from (and
including) a Record Date to (and including) a Distribution Date,
a Unit Holder causes its entire holdings to be issued in
certificate form, or transferred to another's ownership, the
pending distribution, plus any accumulated cash held by the
Trustee pursuant to the Program for the benefit of the Unit
Holder, will be mailed in cash to the Unit Holder on that
Distribution Date. Subsequent distributions will be reinvested
in accordance with the Program, except that if ownership has been
transferred, the new holder must request reinvestment as provided
above.
A Unit Holder may elect to terminate participation in
the Trust Reinvestment Program at any time by notifying the
Trustee in a written format acceptable to the Trustee. Should
the Trustee be so notified, it will upon written confirmation
commence making monthly income distributions and annual capital
gain distributions by check to such Unit Holder. Both the
Sponsor and the Trustee reserve the right at any time to suspend,
modify or discontinue the offering of the Trust Reinvestment
Program, upon 30 days' written notice to all Program
participants.
REDEMPTION
Right of Redemption
A Unit Holder who wishes to dispose of Units is advised
to inquire through its broker or bank as to current market prices
for Units in order to determine if there is an over-the-counter
price in excess of the Redemption Value per Unit or Sponsor's
Repurchase Price.
On the seventh calendar day following the tender to the
Trustee of Certificates representing Units to be redeemed (or if
the seventh calendar day is not a business day, on the first
business day prior thereto) the Unit Holder will be entitled to
receive monies per Unit equal to the Redemption Price per Unit,
as determined as of the Evaluation Time next following such
tender.
During the period in which the Sponsor maintains a
secondary market for Units, the Sponsor may repurchase any Unit
presented for tender to the Trustee for redemption no later than
the close of business on the second business day following such
presentation.
The Trustee is irrevocably authorized in its
discretion, if the Sponsor does not elect to repurchase any Unit
tendered for redemption or if the Sponsor itself tenders Units
for redemption, in lieu of redeeming Units presented for tender
at the Redemption Value, to sell such Units in the over-the-
counter market for the account of a tendering Unit Holder at
prices which will return to the Unit Holder monies, net after
brokerage commissions, transfer taxes and other charges, equal to
or in excess of the Redemption Value for such Units. In the
event of any such sale, the Trustee will pay the net proceeds
thereof to the Unit Holder on the day such Unit Holder would
otherwise be entitled to receive payment of the Redemption Value.
Although more favorable terms may or may not exist in
the secondary market or elsewhere, one or more Units represented
by a Certificate may be redeemed at the Redemption Value upon
tender of such Certificate to the Trustee at its corporate trust
office in the City of New York during business hours on a
business day, properly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Trustee (as
set forth in the Certificate), and executed by the Unit Holder or
its authorized attorney. A Unit Holder may tender Units for
redemption at any time after the settlement date for purchase,
whether or not such Unit Holder has received a definitive
Certificate. The Redemption Value per Unit is calculated as set
forth under "Computation of Redemption Value", herein. There is
no sales charge incurred when a Unit Holder tenders Units to the
Trustee for redemption.
Any amounts to be paid on redemption representing
income shall be withdrawn from the Income Account to the extent
funds are available. All other amounts paid on redemption shall
be withdrawn from the Capital Account. The Trustee is authorized
by the Agreement to sell Securities in order to provide funds for
redemption. To the extent Securities are sold, the size and
diversity of the Trust will be reduced. Such sales may be
required at a time when Securities would not otherwise be sold
and might result in lower prices than might otherwise be
realized. Moreover, due to the minimum principal amount in which
Securities may be required to be sold, the proceeds of such sales
may exceed the amount necessary for payment of Units redeemed.
Such excess proceeds will be distributed pro rata to all
remaining Unit Holders of record unless reinvested in substitute
Securities as directed by the Sponsor.
Securities to be sold for purposes of redeeming Units
will be selected from a list or by instructions supplied by the
Sponsor. The Securities to be sold will be selected so as to
maintain, as closely as practicable, the percentage relationship
between the number of shares of each Security in the Trust
immediately prior to the sale. Provision is made under the
Indenture for the Sponsor to specify minimum amounts in which
blocks of Securities are to be sold in order to obtain the best
price for the Trust. While such minimum amounts may vary from
time to time in accordance with market conditions, the Sponsor
believes that the minimum amounts which would be specified would
be 100 shares for readily marketable Securities.
Computation of Redemption Value
The Trust Evaluation per Unit is determined as of the
Evaluation Time stated under "Summary of Essential Information",
above, and (a) semiannually, on June 30 and December 31 of each
year (or the last business day prior thereto), (b) on any
business day as of the Evaluation Time next following the tender
of any Unit and (c) on any other business day desired by the
Sponsor or the Trustee:
1. by adding:
a) The aggregate value of Securities and Contract
Obligations in the Trust, as determined by the Trustee; and
b) Cash on hand in the Trust, including dividends
receivable on stocks trading ex-dividend other than money
deposited to purchase Contract Obligations or money credited
to the Reserve Account; and then,
2. by deducting from the resulting figure: amounts
representing any applicable taxes or governmental charges payable
by the Trust for the purpose of making an addition to the reserve
account (as defined in the Agreement, the "Reserve Account"),
amounts representing estimated accrued fees and expenses of the
Trust (including legal and auditing expenses), amounts
representing unpaid fees of the Trustee, the Sponsor and counsel
and monies held to redeem tendered Units and for distribution to
Unit Holders of record as of the business day prior to the
Evaluation being made on the days or dates set forth above; and
then,
3. by dividing the result of the above computation by
the total number of Units outstanding on the date of such
Evaluation. The resulting figure equals the Redemption Value for
each Unit.
The aggregate value of the Securities shall be
determined by the Trustee in good faith in the following manner:
if the Securities are listed on one or more national securities
exchanges, such evaluation shall generally be based on the
closing sale price on that day (unless the Trustee deems such
price inappropriate as a basis for evaluation) on the exchange
which is the principal market therefor (deemed to be the New York
Stock Exchange if the securities are listed thereon) or, if there
is no such appropriate closing sale price on such exchange, at
the mean between the closing bid and asked prices (unless the
Trustee deems such price inappropriate as a basis for valuation).
If the Securities are not so listed, or if so listed and the
principal market therefor is other than on such exchange or there
are no such closing bid and asked prices available, such
evaluation shall generally be made by the Trustee in good faith
based on the closing price on the over-the-counter market (unless
the Trustee deems such price inappropriate as a basis for
evaluation), or, if there is no such appropriate closing price,
in the following order of priority: (a) on current bid prices,
(b) if bid prices are not available, on the basis of current bid
prices for comparable securities, or (c) by the Trustee's
appraising the value of the securities in good faith on the bid
side of the market.
Postponement of Redemption
The right of redemption may be suspended and payment of
the Redemption Value per Unit postponed for more than seven
calendar days following a tender of Units for redemption (i) for
any period during which the New York Stock Exchange, Inc. is
closed, other than for customary weekend and holiday closings, or
(ii) for any period during which, as determined by the Securities
and Exchange Commission, either trading on the New York Stock
Exchange, Inc. is restricted or an emergency exists as a result
of which disposal or evaluation of the Securities is not
reasonably practicable, or (iii) for such other periods as the
Securities and Exchange Commission may by order permit. The
Trustee is not liable to any person or in any way for any loss or
damage that may result from any such suspension or postponement.
RIGHTS OF UNIT HOLDERS
Unit Holders
Each Unit Holder is deemed to be a beneficiary of the
Trust created by the Indenture and Agreement and each is vested
proportionately with the entire beneficial right, title and
interest in the Trust assets. A Unit Holder may at any time
tender its Certificate to the Trustee for redemption.
Ownership of Units is evidenced by registered
Certificates of Beneficial Interest issued in denominations of
one or more Units and executed by the Trustee and the Sponsor.
These Certificates are transferable or interchangeable upon
presentation at the corporate trust office of the Trustee,
properly endorsed or accompanied by an instrument of transfer
satisfactory to the Trustee and executed by the Unit Holder or
its authorized attorney, together with the payment of $2.00, if
required by the Trustee, or such other amount as may be
determined by the Trustee and approved by the Sponsor, and any
other tax or governmental charge imposed upon the transfer of
Certificates. The Trustee will replace any mutilated, lost,
stolen or destroyed Certificate upon proper identification,
satisfactory indemnity and payment of charges incurred. Any
mutilated Certificate must be presented to the Trustee before any
substitute Certificate will be issued.
Certain Limitations
The death or incapacity of any Unit Holder (or the
dissolution of the Sponsor) will not operate to terminate the
Trust nor entitle the legal representatives or heirs of such Unit
Holder to claim an accounting or to take any other action or
proceeding in any court for a partition or winding up of the
Trust.
No Unit Holder shall have the right to vote except with
respect to removal of the Trustee or amendment and termination of
the Trust. (See: "Administration of the Trust -- Amendment" and
"Administration of the Trust -- Termination".) Unit Holders
shall have no right to control the operation or administration of
the Trust in any manner, except upon the vote of 51% of the Unit
Holders outstanding at any time for purposes of amendment, or
termination of the Trust or discharge of the Trustee, all as
provided in the Agreement; however, no Unit Holder shall ever be
under any liability to any third party for any action taken by
the Trustee or the Sponsor.
EXPENSES AND CHARGES
Fees
The Sponsor's fee is earned for Portfolio supervisory
services, and is based upon the largest number of Units
outstanding at any time during the year. The Sponsor's fee is
not to exceed 25 cents per 1,000 Units of the Trust and may
exceed the actual costs of providing Portfolio supervisory
services for this Trust, but at no time will the total amount the
Sponsor receives for Portfolio supervisory services rendered to
all series of the Dean Witter Select Equity Trust in any calendar
year exceed the aggregate cost to it of supplying such services
in such year.
Under the Indenture and Agreement for its services as
Trustee and Evaluator, the Trustee will receive 84 cents per
1,000 Units, computed monthly on the basis of the largest number
of Units outstanding at any time during the preceding month.
Certain regular and recurring expenses of the Trust, including
certain mailing and printing expenses, are borne by the Trust.
In no event will the Trustee be paid less than $2,000 in any one
year.
The Sponsor's fee accrues monthly but is paid annually,
and the Trustee's fees are payable monthly on or before each
Distribution Date from the Income Account, to the extent funds
are available and thereafter from the Capital Account. Any of
such fees may be increased without approval of the Unit Holders
in proportion to increases under the classification "All Services
Less Rent" in the Consumer Price Index published by the United
States Department of Labor. The Trustee also receives benefits
to the extent that it holds funds on deposit in various non-
interest bearing accounts created under the Agreement.
Other Charges
The following additional charges are or may be incurred
by the Trust as more fully described in the Indenture and
Agreement: (a) fees of the Trustee for extraordinary services,
(b) expenses of the Trustee (including legal and auditing
expenses of the Trust's reinvestment program) and of counsel
designated by the Sponsor, (c) various governmental charges,
(d) expenses and costs of any action taken by the Trustee to
protect the Trust and the rights and interests of the Unit
Holders, (e) indemnification of the Trustee for any loss,
liability or expenses incurred by it in the administration of the
Trust without gross negligence, bad faith, willful malfeasance or
willful misconduct on its part or reckless disregard of its
obligations and duties, (f) indemnification of the Sponsor for
any losses, liabilities and expenses incurred in acting as
Sponsor or Depositor under the Agreement without gross
negligence, bad faith, willful malfeasance or willful misconduct
or reckless disregard of its obligations and duties,
(g) expenditures incurred in contacting Unit Holders upon
termination of the Trust, and (h) brokerage commissions or
charges incurred in connection with the purchase or sale of
additional or substitute Securities.
The fees and expenses set forth herein are payable out
of the Trust, and when so paid by or owing to the Trustee are
secured by a lien on the Trust. Dividends on the Securities are
expected to be sufficient to pay the estimated expenses of the
Trust. If the balances in the Income and Capital Accounts are
insufficient to provide for amounts payable by the Trust, the
Trustee has the power to sell Securities to pay such amounts.
To the extent Securities are sold, the size of the Trust will be
reduced and the proportions of the types of Securities may
change. Such sales might be required at a time when Securities
would not otherwise be sold and might result in lower prices than
might otherwise be realized. Moreover, due to the minimum
principal amount in which Securities may be required to be sold,
the proceeds of such sales may exceed the amount necessary for
the payment of such fees and expenses.
The accounts of the Trust will be audited not less than
annually by independent public accountants selected by the
Sponsor. The expenses of such audit will be an expense of the
Trust; however the Sponsor will bear the cost of any audit
expense which exceeds 50 cents per 1,000 Units during any period
in which the Sponsor maintains a secondary market for Units.
ADMINISTRATION OF THE TRUST
Records and Accounts
The Trustee will keep records and accounts of all
transactions of the Trust at its unit investment trust office at
4 New York Plaza, New York, New York 10004. These records and
accounts will be available for inspection by Unit Holders at
reasonable times during normal business hours. The Trustee will
additionally keep on file for inspection by Unit Holders an
executed copy of the Indenture and Agreement together with a
current list of the Securities then held in the Trust. In
connection with the storage and handling of certain Securities
deposited in the Trust, the Trustee is authorized to use the
services of Depository Trust Company. These services would
include safekeeping of the Securities, coupon-clipping, computer
book-entry transfer and institutional delivery services. The
Depository Trust Company is a limited purpose trust company
organized under the Banking Law of the State of New York, a
member of the Federal Reserve System and a clearing agency
registered under the Securities Exchange Act of 1934.
Distributions
Dividends payable to the Trust as a holder of record of
its Securities are credited by the Trustee to an Income Account,
as of the date on which the Trust is entitled to receive such
dividends. Other receipts, including amounts received upon the
sale, pursuant to the Indenture and Agreement, of rights to
purchase other Securities distributed on the Securities in the
Portfolio, are credited to a Capital Account. Any monthly income
distribution for each Unit Holder as of each Record Date will be
made on the next following Distribution Date or shortly
thereafter and shall consist of an amount equal to approximately
one-twelfth of the amount of net annual dividend income per Unit,
after deducting estimated expenses, plus such holder's pro rata
share of the distributable cash balance of the Capital Account
computed as of the close of business on the Record Date. The
first distribution for persons who purchase Units between a
Record Date and a Distribution Date will be made on the second
Distribution Date following their purchase of Units. Proceeds
received from the disposition of any of the Securities which are
not used for redemption of Units or to purchase substitute
Securities will be held in the Capital Account to be distributed
on the second succeeding Distribution Date following receipt of
such proceeds. No distribution need be made from the Capital
Account if the balance therein, exclusive of capital gains
therein, is less than $5.00 per 1,000 Units outstanding. A
Reserve Account may be created by the Trustee by withdrawing from
the Income or Capital Accounts, from time to time, such amounts
as it deems requisite to establish a reserve for any taxes or
other governmental charges that may be payable out of the Trust.
Funds held by the Trustee in the various accounts created under
the Indenture do not bear interest.
Distributions of net realized capital gains, if any,
will be made annually, within 30 days of the end of the Trust's
taxable year.
Portfolio Supervision
The original proportionate relationship between the
number of shares of each Security in the Trust will be adjusted
to reflect the occurrence of a stock dividend, a stock split or a
similar event which affects the capital structure of the issuer
of a Security in the Trust but which does not affect the Trust's
percentage ownership of the common stock equity of such issuer at
the time of such event.
The Portfolio of the Trust is not "managed" by the
Sponsor or the Trustee; their activities described below are
governed solely by the provisions of the Indenture and Agreement.
The Sponsor may direct the Trustee to dispose of Securities upon
failure to declare or pay anticipated cash dividends, institution
of certain materially adverse legal proceedings, default under
certain documents materially and adversely affecting future
declaration or payment of dividends, or the occurrence of other
materially adverse market or credit factors that in the opinion
of the Sponsor would make the retention of such Securities in the
Trust detrimental to the interests of the Unit Holders, or if the
disposition of such Securities is desirable in order to maintain
the qualification of the Trust as a regulated investment company
under the Internal Revenue Code. If a failure to declare or pay
cash dividends on any of the Securities occurs and if the
Sponsor does not, within 30 days after notification, instruct the
Trustee to sell or hold such Securities, the Indenture provides
that the Trustee shall promptly sell such Securities.
The Sponsor is also authorized to instruct the Trustee
to reinvest the proceeds of the redemption or sale of any of the
Securities, exclusive of any capital gains, in substitute
Securities; provided, however, that proceeds of any sale of
Securities for materially adverse market factors may not be so
reinvested but will be distributed pro rata to Unit Holders on
the next Distribution Date. Proceeds received from Securities
sold for purposes of redemption of Units and in excess of the
amount needed for such purposes may not be reinvested in any year
during the term of the Trust in an amount exceeding 10% of the
aggregate value of the Securities in the Trust upon completion of
the Deposit Period. The substitute Securities must satisfy
certain conditions specified in the Indenture including, among
other conditions, requirements that the substitute Securities
shall be selected by the Sponsor from a list of securities
maintained by them, and updated from time to time, and that the
Securities shall be publicly-traded common and preferred stocks
issued by domestic public utility corporations; shall be issued
by an issuer subject to or exempt from the reporting requirements
under Section 13 or 15(d) of the Securities Exchange Act of 1934
(or similar provisions of law); and shall have, in the opinion of
the Sponsor, characteristics sufficiently similar to the
characteristics of the other Securities in the Trust as to be
acceptable for acquisition by the Trust. Such conditions also
require that the purchase of the substitute Securities will not
(i) disqualify the Trust as a "regulated investment company"
under the Internal Revenue Code, (ii) result in more than 25% of
the Portfolio of the Trust consisting of Securities of a single
issuer (or of two or more issuers which are affiliated persons as
such term is defined in the Investment Company Act of 1940) which
are not registered and are not being registered under the
Securities Act of 1933, or (iii) result in the Trust owning more
than 50% of any single issue which has been registered under the
Securities Act of 1933 or more than 5% of the outstanding voting
securities of any issuer.
The Trustee will follow a policy that it will place
securities transactions with a broker or dealer only if it
expects to obtain the most favorable prices and executions of
orders. Transactions in securities of the nature held in the
Trust are generally carried out in brokerage transactions (as
distinguished from principal transactions), and the Sponsor or
any of its affiliates may act as brokers therein if the Trustee
expects thereby to obtain the most favorable prices and
execution. The furnishing of statistical and research
information to the Trustee by any of the securities dealers
through which transactions are executed will not be considered in
placing securities transactions.
During the life of the Trust, the Sponsor, as part of
its administrative responsibilities, may make additions and
deletions to the list of substitute Securities and shall conduct
regular quarterly reviews to determine whether or not to
recommend the disposition of Securities pursuant to the
procedures under the Indenture and Agreement summarized above.
In addition, the Sponsor shall undertake to perform such other
reviews and procedures as it may deem necessary for it to make
the reinvestment recommendations and to give the consents and
directions, including directions as to voting on the underlying
Securities, required by the Indenture and Agreement. For the
administrative services in making such recommendations and giving
such consents and directions, and in making the reviews called
for in connection therewith, the Sponsor shall receive the
Portfolio supervisory fee referred to under "Expenses and
Charges -- Fees".
Reports to Unit Holders
With each distribution, the Trustee will furnish to the
Unit Holders a statement of the amount of income and other
receipts, if any, distributed, expressed in each case as a dollar
amount per Unit and a change of address card.
Within two months after the end of each calendar year,
the Trustee will furnish to each person who at any time during
such calendar year was a Unit Holder of record a statement
setting forth:
1. As to the Income and Capital Accounts:
a) the amount of income received on the Securities;
b) the amount paid for any purchase of substitute
Securities or for any Certificates redeemed;
c) the deductions for applicable taxes or other
governmental charges, if any, and fees and expenses of the
Sponsor, the Trustee and counsel;
d) the amounts reserved for the purchase of Contract
Securities; and
e) the net amount remaining after such payments and
deductions expressed both as a total dollar amount and as a
dollar amount per Unit outstanding on the last business day
of such calendar year.
2. The following information:
a) a list of the Securities disposed of or acquired
during the calendar year, and a list of the Securities as of
the last business day of such calendar year;
b) the number of Units outstanding on the last
business day of such calendar year;
c) the Unit Value (as defined in the Agreement) based
on the last Trust Evaluation made during such calendar year;
and
d) the amounts actually distributed during such
calendar year from the Income and Capital Accounts,
separately stated, expressed both as total dollar amounts
and as dollar amounts per Unit outstanding on the Record
Dates for such distributions.
Required United States federal income tax information
will also be filed and distributed.
Amendment
The Indenture and Agreement may be amended by the
Trustee and the Sponsor without the consent of Unit Holders (a)
to cure any ambiguity or to correct or supplement any provision
thereof which may be defective or inconsistent, (b) to change any
provision thereof as may be required by the Securities and
Exchange Commission or any successor governmental agency, (c) to
add or change any provision as may be necessary or advisable for
the continuing qualification of the Trust as a regulated
investment company under the Code, or (d) to make such other
provisions as shall not adversely affect the interest of the Unit
Holders; provided, however, that the Indenture and Agreement may
also be amended by the Sponsor and the Trustee (or the
performance of any of the provisions of the Agreement may be
waived) with the consent of Unit Holders evidencing 51% of the
Units at the time outstanding for the purposes of adding any
provisions to or changing in any manner or eliminating any of the
provisions of the Agreement or of modifying in any manner the
rights of Unit Holders. However, the Indenture and Agreement may
not be amended, without the consent of all Unit Holders then
outstanding, so as (1) to permit, except in accordance with the
terms and conditions of the Agreement, the acquisition of any
Securities other than those specified in the Indenture and
Agreement, or (2) to reduce the aforesaid percentage of Units the
holders of which are required to consent to certain of such
amendments and may not be amended so as to reduce the interest in
the Trust represented by Units evidenced by any Certificate
without the consent of the holder of such Certificate. The
Trustee shall promptly notify Unit Holders of the substance of
any such amendment.
Termination
The Indenture and Agreement provides that the Trust
will be terminated and liquidated on the Mandatory Termination
Date, as set forth under "Summary of Essential Information",
herein. Additionally, if the value of the Trust as shown by any
evaluation is less than thirty percent (30%) of the value of the
Securities deposited into the Trust during the Deposit Period,
the Trustee will, if directed by the Sponsor in writing,
terminate the Trust. The Trust may also be terminated at any
time by the written consent of 51% of the Unit Holders.
Upon termination, the Trustee will sell the Securities
then held in the Trust and credit the moneys derived from such
sale to the Capital and Income Accounts. The Trustee will then,
after deduction of any fees and expenses of the Trust and payment
into the Reserve Account of any amount required for taxes or
other governmental charges that may be payable by the Trust,
distribute to each Unit Holder, upon surrender for cancellation
of his Certificate after due notice of such termination, such
Unit Holder's pro rata share in the Income and Capital Accounts.
The sale of Securities in the Trust upon termination may result
in a lower amount than might otherwise be realized if such sale
were not required at such time. For this reason, among others,
the amount realized by a Unit Holder upon termination may be less
than the amount paid by such Unit Holder for Units.
RESIGNATION, REMOVAL AND LIABILITY
Regarding the Trustee
The Trustee shall be under no liability for any action
taken in good faith in reliance on prima facie properly executed
documents, or for the disposition of monies or Securities in the
Trust, or otherwise except for willful malfeasance, willful
misconduct, bad faith or gross negligence in the performance of
its duties or by reason of its reckless disregard of its
obligations and duties under the Indenture and Agreement. Nor
shall the Trustee be liable or responsible in any way for
depreciation or loss incurred by reason of the disposition of any
Securities by the Trustee required in order to pay compensation
of the Trustee or expenses and disbursements under the Agreement.
In the event of a failure of the Sponsor to act, the Trustee may
act under the Indenture and Agreement and shall not be liable for
any action taken by it in good faith. The Trustee shall not be
personally liable for any taxes or other governmental charges
imposed upon the Trust or in respect of the Securities or the
interest thereon. The Agreement also contains other customary
provisions limiting the liability of the Trustee and providing
for the indemnification of the Trustee for any loss or claim
accruing to it without gross negligence, bad faith, willful
misconduct, willful malfeasance or reckless disregard of its
duties and obligations under the Agreement on its part.
The Trustee or any successor may resign by executing an
instrument in writing, filing the same with the Sponsor and
mailing a copy of such notice or resignation to all Unit Holders
then of record. Upon receiving such notice the Sponsor will use
its best efforts to appoint a successor Trustee promptly. If the
Trustee becomes incapable of acting or becomes bankrupt or its
affairs are taken over by public authorities, the Sponsor may
remove the Trustee and appoint a successor as provided in the
Agreement. If within 30 days of the resignation of a Trustee no
successor has been appointed or, if appointed, has not accepted
the appointment, the retiring Trustee may apply to a court of
competent jurisdiction for the appointment of a successor. The
resignation or removal of a Trustee becomes effective only when
the successor Trustee accepts its appointment as such or when a
court of competent jurisdiction appoints a successor Trustee.
Regarding the Sponsor
The Sponsor shall be under no liability to the Trust or
to Unit Holders for taking any action or for refraining from any
action in good faith or for errors in judgment, nor shall the
Sponsor be liable or responsible in any way for depreciation or
loss incurred by reason of the disposition of any Security. The
Sponsor will, however, be liable for its own willful malfeasance,
willful misconduct, bad faith, gross negligence or reckless
disregard of its duties and obligations under the Agreement.
If at any time the Sponsor shall resign under the
Agreement or shall fail or be incapable of performing its duties
thereunder or shall become bankrupt or its affairs are taken over
by public authorities, the Agreement directs the Trustee to
either (1) appoint a successor Sponsor or Sponsors at rates of
compensation deemed reasonable by the Trustee, not exceeding
amounts prescribed by the Securities and Exchange Commission, or
(2) act as Sponsor itself without terminating the Indenture and
Agreement. The Trustee will promptly notify Unit Holders of any
such action.
MISCELLANEOUS
Sponsor
Dean Witter Reynolds Inc. ("Dean Witter") is a
corporation organized under the laws of the State of Delaware and
is a principal operating subsidiary of Dean Witter, Discover &
Co. ("DWDC"), a publicly-traded corporation. Dean Witter is a
financial services company that provides to its individual,
corporate, and institutional clients services as a broker in
securities and commodities, a dealer in corporate, municipal, and
government securities, an investment banker, an investment
adviser, and an agent in the sale of life insurance and various
other products and services. Dean Witter is a member firm of the
New York Stock Exchange, the American Stock Exchange, the Chicago
Board Options Exchange, other major securities exchanges and the
National Association of Securities Dealers, and is a clearing
member of the Chicago Board of Trade, the Chicago Mercantile
Exchange, the Commodity Exchange Inc., and other major commo-
dities exchanges. Dean Witter is currently servicing its clients
through a network of approximately 375 domestic and international
offices with approximately 7,500 account executives servicing
individual and institutional client accounts.
Trustee
The Trustee is The Chase Manhattan Bank, a New York
Bank, with its principal executive office located at 270 Park
Avenue, New York, New York 10017 and its unit investment trust
office at 4 New York Plaza, New York, New York 10004. The
Trustee is subject to supervision by the Comptroller of the
Currency, the Federal Deposit Insurance Corporation and the Board
of Governors of the Federal Reserve System. Unit Holders should
direct inquiries regarding distributions, address changes and
other matters relating to the administration of the Trust to the
Trustee at 1-800-428-8890.
Legal Opinions
Certain legal matters in connection with the Units
offered hereby have been passed upon by Cahill Gordon & Reindel,
a partnership including a professional corporation, 80 Pine
Street, New York, New York 10005, as special counsel for the
Sponsor.
AUDITORS
The Financial Statements and Schedule of Portfolio
Securities of this series of the Dean Witter Select Equity Trust
included in this Prospectus have been examined by Deloitte &
Touche LLP, certified public accountants, as stated in their
report as set forth in this Prospectus, and are included in
reliance upon such report given upon the authority of that firm
as experts in accounting and auditing.
<PAGE>
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
THE UNIT HOLDERS, SPONSOR AND TRUSTEE
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
We have audited the statement of financial condition and schedule of
portfolio securities of the Dean Witter Select Equity Trust Utility Stock
Series 1 as of March 31, 1997, and the related statements of operations and
changes in net assets for each of the three years in the period then ended.
These financial statements are the responsibility of the Trustee (see
Footnote (a)(1)). Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
Our procedures included confirmation of the securities owned as of March 31,
1997 as shown in the statement of financial condition and schedule of
portfolio securities by correspondence with The Chase Manhattan Bank, the
Trustee. An audit also includes assessing the accounting principles used
and the significant estimates made by the Trustee, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of the Dean Witter Select
Equity Trust Utility Stock Series 1 as of March 31, 1997, and the results of
its operations and the changes in its net assets for each of the three years
in the period then ended in conformity with generally accepted accounting
principles.
DELOITTE & TOUCHE LLP
May 15, 1997
New York, New York
F-1
</AUDIT-REPORT>
<PAGE>
STATEMENT OF FINANCIAL CONDITION
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
March 31, 1997
TRUST PROPERTY
Investments in securities at market value (cost $27,963,497)
(Note (a) and Schedule of Portfolio Securities Notes (3)
and (4)) $31,064,905
Dividend receivable 83,817
Cash 232,713
Receivable from Broker 63,092
Total 31,444,527
LIABILITY AND NET ASSETS
Less Liability:
Payable to Unit Holders 64,129
Net Assets:
Balance applicable to 34,424,254 Units
(Note (c)):
Capital plus net unrealized market
appreciation of $3,101,408 $31,064,905
Undistributed principal and net investment
income (Note (b)) 315,493
Net assets $31,380,398
Net asset value per Unit ($31,380,398 divided
by 34,424,254 Units) $0.9116
See notes to financial statements
F-2
<PAGE>
STATEMENTS OF OPERATIONS
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
For the years ended March 31,
1997 1996 1995
Investment income - dividends $2,318,929 $2,687,825 $3,091,341
Other income - - 44,436
Total income 2,318,929 2,687,825 3,135,777
Less:
Trustee's fees and expenses 84,714 91,029 84,834
Sponsor's fees 11,180 11,242 12,860
Total expenses 95,894 102,271 97,694
Investment income - net 2,223,035 2,585,554 3,038,083
Net (loss) gain on investments:
Realized gain on securities sold
or redeemed 957,568 818,965 1,059,008
Net unrealized market (deprecia-
tion) appreciation of invest-
ments (4,069,595) 4,962,892 (2,248,738)
Net (loss) gain on
investments (3,112,027) 5,781,857 (1,189,730)
Net (decrease) increase in net
assets resulting from operations $ (888,992) $8,367,411 $1,848,353
See notes to financial statements
F-3
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
For the years ended March 31,
1997 1996 1995
Operations:
Investment income - net $2,223,035 $ 2,585,554 $ 3,038,083
Realized gain on securities
sold or redeemed 957,568 818,965 1,059,008
Net unrealized market (deprecia-
tion) appreciation of
investments (4,069,595) 4,962,892 (2,248,738)
Net (decrease) increase
in net assets result-
ing from operations (888,992) 8,367,411 1,848,353
Distributions to Unit Holders
(Note (b)):
Principal (1,259,404) - (970,854)
Investment income - net (2,254,196) (2,610,222) (3,002,756)
Total distributions (3,513,600) (2,610,222) (3,973,610)
Capital Share Transactions:
Creation of 578,404 Units 558,285 - -
Redemption of 5,633,000 Units
5,803,750 Units and
5,445,000 Units, respec-
tively (5,433,814) (5,720,370) (4,700,052)
Accrued income on redemption (36,224) (36,709) (33,712)
Net capital share
transactions (4,911,753) (5,757,079) (4,733,764)
Net (decrease) increase in net
assets (9,314,345) 110 (6,859,021)
Net assets - beginning of year 40,694,743 40,694,633 47,553,654
Net assets - end of year (including
undistributed principal and net
investment income of $315,493
$400,301 and $466,297, respec-
tively) $31,380,398 $40,694,743 $40,694,633
See notes to financial statements
F-4
<PAGE>
NOTES TO FINANCIAL STATEMENTS
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
March 31, 1997
(a) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Trust is registered under the Investment Company Act of 1940 as a
Unit Investment Trust. The following is a summary of the significant
accounting policies of the Trust:
(1) Basis of Presentation
The Trustee has custody of and responsibility for all accounting and
financial books, records, financial statements and related data of
the Trust and is responsible for establishing and maintaining a
system of internal controls directly related to, and designed to
provide reasonable assurance as to the integrity and reliability
of, financial reporting of the Trust. The Trustee is also
responsible for all estimates and accruals reflected in the Trust's
financial statements. Under the Securities Act of 1933 ("the
Act"), as amended, the Sponsor is deemed to be an issuer of the
Trust Units. As such, the Sponsor has the responsibility of an
issuer under the Act with respect to financial statements of the
Trust included in the Trust's Registration Statement under the Act
and amendments thereto.
(2) Investments
Investments are stated at market value as determined by the Trustee,
based on the closing price on the New York Stock Exchange, on the
last day of trading during the period. The value on the date of
initial deposit (April 2, 1987) represents the cost of investments
to the Trust based on the closing sale price on the New York Stock
Exchange on the day prior to the date of deposit. The cost of
investments purchased subsequent to the date of initial deposit is
based on the closing sale price on date of purchase.
(3) Income Taxes
No provision for Federal income taxes has been made in the
accompanying financial statements because the Trust intends to
continue to qualify for the tax treatment applicable to "Regulated
Investment Companies" under the Internal Revenue Code. Under
existing law, if the Trust so qualifies, it will not be subject to
Federal income tax on net income and capital gains that are
distributed to Unit Holders.
(4) Expenses
The Trust pays annual Trustee's fees, including estimated expenses,
and annual Sponsor's portfolio supervision fees, and may incur
additional charges as explained under "Expenses and Charges - Fees"
and "- Other Charges" in this Prospectus.
F-5
<PAGE>
NOTES TO FINANCIAL STATEMENTS
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
March 31, 1997
(b) DISTRIBUTIONS
Distributions of dividend income and principal, if any, received by the
Trust are made to Unit Holders on a monthly basis and distributions of
net realized capital gains, if any, will be made annually, within 30
days after the end of the Trust's taxable year to Unit Holders of
record. Record Dates are the first day of each calendar month and
Distribution Dates are the fifteenth day of each month (or the next
business day thereafter if the fifteenth is not a business day). Upon
termination of the Trust, the Trustee will distribute, upon surrender of
Certificates for cancellation, to each Unit Holder its pro rata share of
the Trust's assets, less expenses, in the manner set forth under
"Distributions to Unit Holders" herein (See: "Administration of the
Trust - Distributions" in this Prospectus).
(c) ORIGINAL COST TO INVESTORS
The original cost to investors represents the aggregate initial public
offering price as of the respective dates of deposit, computed on the
basis set forth under "Public Offering of Units - Public Offering Price"
in this Prospectus.
A reconciliation of the original cost of Units to investors to the net
amount applicable to investors as of March 31, 1997 follows:
Cost of 1,000,000 Units at dates of deposit $ 992,980
Less: Gross underwriting commissions (sales charge) (44,680)
Net cost to investors at initial deposit 948,300
Cost to investors of Units created during deposit
period 103,098,171
Cost of substituted securities 22,400,684
Net unrealized market appreciation of investments 3,101,408
Cost of securities sold or redeemed (98,483,658)
Net amount applicable to investors $ 31,064,905
F-6
<PAGE>
NOTES TO FINANCIAL STATEMENTS
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
March 31, 1997
(d) OTHER INFORMATION
Selected data for a Unit of the Trust during each year:
For the years ended March 31,
1997 1996 1995
Principal distributions during
year $.0343 $ - $.0194
Net investment income distribu-
tions during year $.0603 $ .0613 $.0620
Net asset value at end of year $.9116 $1.0308 $.8987
Trust Units outstanding at
end of year 34,424,254 39,478,850 45,282,600
F-7
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE OF PORTFOLIO SECURITIES
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
March 31, 1997
Current Market Percentage of
Number Annual Price per Aggregate Market
Portfolio No. and Name of Issuer of Dividend Yield Share to Market Value Value
of Securities Contracted For Shares Shares Per Share<F2> <F3> Trust of Trust <F4><F5>
Common Stocks
<S> <C> <C> <C> <C> <C> <C> <C>
1. American Electric Power Company Inc. 44,056 $2.40 5.818% $41.250 5.850% $1,817,310
2. Northeast Utilities 63,764 1.00 12.698 7.875 1.616 502,141
3. Houston Industries Incorporated 67,730 1.50 7.186 20.875 4.551 1,413,864
4. PECO Energy Company (formerly
Philadelphia Electric Co.) 172,245 1.80 8.834 20.375 11.297 3,509,492
5. Portland General Corporation 56,361 1.28 3.670 34.875 6.327 1,965,590
6. Public Service Enterprise Group
Incorporated 30,763 2.16 8.229 26.250 2.599 807,529
7. Puget Sound Power & Light Company 57,158 1.84 7.287 25.250 4.646 1,443,240
8. Ohio Edison Company 188,811 1.50 7.101 21.125 12.840 3,988,632
9. Southern Company 82,129 1.30 6.154 21.125 5.585 1,734,975
10. Southwestern Public Service Company 16,603 2.20 6.132 35.875 1.917 595,633
11. Pacificorp 66,122 1.08 5.053 21.375 4.550 1,413,358
12. Washington Water Power Company 82,479 1.24 7.137 17.375 4.614 1,433,073
13. New York State Electric & Gas
Corporation 49,959 1.40 6.474 21.625 3.478 1,080,363
14. Western Resources Inc. 53,303 2.10 7.000 30.000 5.147 1,599,090
15. Boston Edison Company 24,554 1.88 7.162 26.250 2.075 644,542
16. Union Electric Company 37,422 2.54 6.888 36.875 4.442 1,379,936
17. DPL 25,655 1.36 5.637 24.125 1.992 618,927
18. CIPSCO, Inc. 33,655 2.08 5.880 35.375 3.832 1,190,546
19. PP&L Resources, Inc. 63,601 1.67 8.247 20.250 4.146 1,287,920
20. Cinergy Corporation 61,545 1.80 5.275 34.125 6.761 2,100,223
21. DTE Energy Co. 20,038 2.06 7.665 26.875 1.735 538,521
$31,064,905
See notes to schedule of portfolio securities
F-8
</TABLE>
<PAGE>
NOTES TO SCHEDULE OF PORTFOLIO SECURITIES
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 1
March 31, 1997
<F2> Based on the latest quarterly or semiannual declaration.
<F3> The Yield represents the Current Annual Dividend per Share divided
by the Market Price per Share.
<F4> Valuation of Securities by the Trustee was made on the basis of the
closing sale price on the New York Stock Exchange as of March 31,
1997 (the last trading date during the period).
<F5> At March 31, 1997, the net unrealized market appreciation of
Securities was comprised of the following:
Gross unrealized market appreciation $4,860,966
Gross unrealized market depreciation (1,759,558)
Net unrealized market appreciation $3,101,408
The aggregate cost of the Securities to the Trust for Federal income
tax purposes was $27,963,497 at March 31, 1997.
<F6> In order to comply with the requirements of a "regulated investment
company" under the Internal Revenue Code, the Sponsor instructed
the Trustee to sell 3,950 shares of Washington Water Power Company.
The proceeds of the sale were reinvested into the common stock of
DTE Energy Co.
F-9
<PAGE>
CONTENTS OF REGISTRATION STATEMENT
This registration statement comprises the following
documents:
The facing sheet.
The Cross Reference Sheet.
The Prospectus.
The signatures.
Consent of Independent Auditors; all other
consents were previously filed.
The following exhibit:
23. 1b. Consent of Independent Auditors.
27. Financial Data Schedule.
FINANCIAL STATEMENTS
1. Statement of Financial Condition, Statement of Operations
and Statement of Changes in Net Assets of the Trust, as
shown in the Prospectus.
<PAGE>
CONSENT OF COUNSEL
The consent of Counsel to the use of its name in the
Prospectus included in this Registration Statement is contained
in its opinion filed as an exhibit to this Registration
Statement.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933, the registrant, Dean Witter Select Equity Trust, Utility
Stock Series 1, 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 No. 10 to the Registration Statement to
be signed on its behalf by the undersigned, thereunto duly
authorized, all in The City of New York and State of New York on
the 22nd day of May, 1997.
DEAN WITTER SELECT EQUITY TRUST,
UTILITY STOCK SERIES 1
(Registrant)
By: DEAN WITTER REYNOLDS INC.
(Depositor)
Thomas Hines
Thomas Hines
Authorized Signatory
Pursuant to the requirements of the Securities Act of
1933, this Post-Effective Amendment No. 10 to the Registration
Statement has been signed on behalf of Dean Witter Reynolds Inc.,
the Depositor, by the following person in the following
capacities and by the following persons who constitute a majority
of the Depositor's Board of Directors in The City of New York and
State of New York on this 22nd day of May, 1997.
Name Office
Philip J. Purcell Chairman & Chief )
Executive Officer )
and Director )
Richard M. DeMartini Director
Robert J. Dwyer Director
Christine A. Edwards Director
Charles A. Fiumefreddo Director
James F. Higgins Director
Mitchell M. Merin Director
Stephen R. Miller Director
Richard F. Powers III Director
Thomas C. Schneider Director
William B. Smith Director
By:
Thomas Hines
Thomas Hines
Attorney-in-fact
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. TITLE OF DOCUMENT
23. 1b. Consent of Deloitte & Touche LLP
27. Financial Data Schedule
<PAGE>
<PAGE>
Exhibit 23.1b.
CONSENT OF INDEPENDENT AUDITORS
We consent to the use of our report dated May 15, 1997, accompanying the
financial statements of the Dean Witter Select Equity Trust Utility Stock
Series 1 included herein and to the reference to our Firm as experts under
the heading "Auditors" in the prospectus which is a part of this
registration statement.
DELOITTE & TOUCHE LLP
May 22, 1997
New York, New York
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND> THE SCHEDULE CONTAINS SUMMARY FINANCIAL
INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS FOR DEAN WITTER SELECT
EQUITY TRUST UTILITY STOCK SERIES
1 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS
<RESTATED>
<SERIES>
<NAME> DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES
<NUMBER> 1
<MULTIPLIER> 1
<FISCAL-YEAR-END> Mar-31-1997
<PERIOD-START> Apr-1-1996
<PERIOD-END> Mar-31-1997
<PERIOD-TYPE> YEAR
<INVESTMENTS-AT-COST> 27,963,497
<INVESTMENTS-AT-VALUE> 31,064,905
<RECEIVABLES> 146,909
<ASSETS-OTHER> 232,713
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 31,444,527
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 64,129
<TOTAL-LIABILITIES> 64,129
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 27,938,556
<SHARES-COMMON-STOCK> 34,424,254
<SHARES-COMMON-PRIOR> 39,478,850
<ACCUMULATED-NII-CURRENT> 340,434
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 3,101,408
<NET-ASSETS> 31,380,398
<DIVIDEND-INCOME> 2,318,929
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 95,894
<NET-INVESTMENT-INCOME> 2,223,035
<REALIZED-GAINS-CURRENT> 957,568
<APPREC-INCREASE-CURRENT> (4,069,595)
<NET-CHANGE-FROM-OPS> (888,992)
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 2,254,196
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 1,259,404
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 5,633,000
<SHARES-REINVESTED> 578,404
<NET-CHANGE-IN-ASSETS> (9,314,345)
<ACCUMULATED-NII-PRIOR> 425,807
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
