<PAGE>
Utility Stock Series 7
File No. 33-41971
Investment Company Act No. 811-5065
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 3
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 7
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
<PAGE>
The Registrant has registered an indefinite number of
Units of Beneficial Interest pursuant to Rule 24f-2
promulgated under the Investment Company Act of 1940,
as amended. On February 27, 1995, the Registrant
filed the Rule 24f-2 Notice for its most recent
fiscal year.
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 7
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 <F30>
8. Fiscal Year Included in Form N-8B-2
9. Litigation <F30>
II. General Description of the Trust
and Securities of the Trust
10. General Information regarding
Trust's Securities and Rights
of Holders
____________________
<F30> Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
(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 <F30>
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
____________________
<F30> Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
4. Identity of Depositor Resignation, removal and
Liability -- Regarding
the Trustee;
-- Regarding the Sponsor
and Trustee
(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 <F30>
and Trustee
11. Type of securities comprising The Trust-Summary
units Description of the
Portfolio; - Objectives
and Securities Selection
12. Type of securities comprising <F30>
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 <F30>
regarding periodic payment
certificates
(c) Certain percentages Public Offering of
Units -- Public Offering
Price;
-- Profit of Sponsor;
-- Volume Discount;
Exchange Option
____________________
<F30> Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
(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 <F30>
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 Offer-
ing 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 <F30>
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
____________________
<F30> Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
-- Resignation, Removal
and Liability
-- Regarding the Trustee;
-- Regarding the Sponsor
21. Loans to security holders <F30>
22. Limitations on liability Resignation, Removal and
Liability
23. Bonding arrangements Included on Form N-8B-2
24. Other material provisions of <F30>
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 <F30>
officials and affiliated
persons of Depositor
29. Voting securities of Depositor Included in Form N-8B-2
30. Persons controlling Depositor <F30>
31. Payments by Depositor for <F30>
certain other services
32. Payments by Depositor for <F30>
certain other services
rendered to trust
33. Remuneration of employees of <F30>
Depositor for certain services
rendered to trust
____________________
<F30> Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
34. Remuneration of other <F30>
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 <F30>
trust's securities
37. Revocation of authority to <F30>
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 <F30>
underwriter
(c) Salesman of principal <F30>
underwriter
42. Ownership of trust's securities <F30>
by certain persons
43. Certain brokerage commissions <F30>
received by principal underwriter
44. (a) Method of valuation Public Offering of Units
-- Public Offering Price;
-- Secondary Market
____________________
<F30> Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
(b) Schedule as to offering <F30>
price
(c) Variation in offering Public Offering of Units-
price to certain persons -- Volume Discount;
Exchange Option
45. Suspension of redemption rights <F30>
46. (a) Redemption valuation Public Offering of Units-
Secondary Market;
Redemption
-- Right of Redemption;
-- Computation of
Redemption Value
(b) Schedule as to redemption <F30>
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 <F30>
Insurance Company
(b) Type of policies <F30>
(c) Type of risks insured and <F30>
excluded
(d) Coverage of policies <F30>
____________________
<F30> Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
(e) Beneficiaries of policies <F30>
(f) Terms and manner of <F30>
cancellation
(g) Method of determining <F30>
premiums
(h) Amount of aggregate <F30>
premiums paid
(i) Who receives any part of <F30>
premiums
(j) Other material provisions <F30>
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 <F30>
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
____________________
<F30> Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
53. a) Taxable status of the Tax Status of the Trust
Trust
b) Qualification of the <F30>
Trust as regulated
investment company
VIII. Financial and Statistical Information
54. Information regarding the <F30>
Trust's past ten fiscal years
55. Certain information regarding <F30>
periodic payment plan
certificates
56. Certain information regarding <F30>
periodic payment plan
certificates
57. Certain information regarding <F30>
periodic payment plan
certificates
58. Certain information regarding <F30>
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
____________________
<F30> Not applicable, answer negative or not required.
<PAGE>
LOGO
Dean Witter Select Equity Trust
UTILITY STOCK SERIES 7
(A Unit Investment Trust)
The objectives of the Trust are to provide consistent current
income, potential for growth of income and capital appreciation
through investment in a fixed portfolio consisting of publicly
traded common stocks issued by domestic investor-owned 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.
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 September 28, 1995
<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 7
TABLE OF CONTENTS
Page
Table of Contents................................................. A-1
Summary of Essential Information.................................. A-3
Introduction...................................................... 1
The Trust......................................................... 3
Special Considerations...................................... 3
Summary Description of the Portfolio........................ 3
Certain Risks Affecting Securities of
Utilities Companies....................................... 5
Objectives and Securities Selection......................... 9
Income and Distributions.................................... 10
Tax Status of the Trust........................................... 11
Public Offering of Units.......................................... 16
Public Offering Price....................................... 16
Public Distribution......................................... 17
Secondary Market............................................ 17
Profit of Sponsor........................................... 18
Volume Discount............................................. 18
Exchange Option................................................... 19
Reinvestment Programs............................................. 21
Redemption........................................................ 22
Right of Redemption......................................... 22
Computation of Redemption Price............................. 24
Postponement of Redemption.................................. 25
Rights of Unit Holders............................................ 26
Unit Holders................................................ 26
Certain Limitations......................................... 26
Expenses and Charges.............................................. 27
Fees........................................................ 27
Other Charges............................................... 27
Administration of the Trust....................................... 28
Records and Accounts........................................ 28
Distribution................................................ 29
Portfolio Supervision....................................... 29
Voting of the Portfolio Securities.......................... 30
Reports to Unit Holders..................................... 30
Amendment................................................... 31
Termination................................................. 32
A-1
<PAGE>
Page
Resignation, Removal and Liability................................ 34
Regarding the Trustee....................................... 34
Regarding the Sponsor....................................... 35
Miscellaneous..................................................... 35
Sponsor..................................................... 35
Trustee..................................................... 35
Legal Opinions.............................................. 36
Auditors.......................................................... 36
Independent Auditors' Report........................... F-1
Sponsor:
Dean Witter Reynolds Inc.
2 World Trade Center
New York, New York 10048
Trustee:
The Chase Manhattan Bank (National Association)
1 Chase Manhatttan Plaza
New York, New York 10081
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.
A-2
<PAGE>
<TABLE>
<CAPTION>
SUMMARY OF ESSENTIAL INFORMATION
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 7
As of July 31, 1995
Number of Units ......................................................................... 24,775,000
Fractional Undivided Interest in the Trust Represented by Each Unit ..................... 1/24,775,000th
Public Offering Price Per 1,000 Units:
Aggregate Value of Securities in the Trust ........................................... $21,421,008.00
Divided by 24,775,000 Units (times 1,000) ............................................ $ 864.62
Plus Sales Charge<F1> of 3.25% of Public Offering Price (3.359% of net amount invested
in Securities) ...................................................................... 29.04
Public Offering Price per 1,000 Units ................................................ 893.66
Plus amount per 1,000 Units of Undistributed Principal and Net Investment Income...... 4.21
Total ........................................................................... $ 897.87
Sponsor's Repurchase Price per 1,000 Units and Redemption Price per 1,000 Units (based
on the value of the underlying Securities, $29.04 less than the Public Offering Price
per 1,000 Units) plus undistributed principal and net investment income .............. $ 868.83
<S> <C> <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 Principal Account if the
balance therein is less than $1.00 per 1,000
Units outstanding.
In-Kind Distribution Date .................... August 22, 1997.
Liquidation Period ........................... Not to exceed ten (10) business days after the In-Kind
Distribution Date.<F3>
Mandatory Termination Date ................... September 8, 1997.
Discretionary Liquidation Amount ............. The Indenture may be terminated by the Sponsor if the
value of the Trust at any time is less than
$15,843,792.
Trustee's Fee (including estimated expenses<F2> $1.34 per 1,000 Units.
Sponsor's Annual Portfolio Supervision Fee<F2> . Maximum of $.25 per 1,000 Units.
<FN>
<F1>Volume purchasers of Units are entitled to a reduced sales charge. See: "Public Offering of Units -
Volume Discount" in this Prospectus.
<F2>The fee accrues daily and is payable on each Distribution Date. Estimated dividends from the Securities,
based on the last dividends actually paid, are expected by the Sponsor to be sufficient to pay the estimated
expenses of the Trust. (See "Expenses and Charges" in this Prospectus.)
<F3>The final distribution will be made within three (3) business days following the receipt of proceeds from
the sale of all Portfolio Securities. (See "Administration of the Trust - Termination" in this Prospectus.)
A-3
</TABLE>
<PAGE>
SUMMARY OF ESSENTIAL INFORMATION
(Continued)
THE TRUST -- The Dean Witter Select Equity Trust,
Utility Stock Series 7 (the "Trust") is a unit investment trust
composed of publicly-traded common stocks (the "Securities").
The objectives of the Trust are to provide consistent current
income, potential for growth of income and capital appreciation
through investment in Securities issued by companies in the
public gas and electric utilities industry. The payment of
dividends on the Securities in the Trust is dependent on the
amounts each issuer has available 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
objectives 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. The Sponsor may, under the Indenture and Agreement
(as hereinafter defined), deposit additional Securities which
may result in a corresponding increase in the number of Units
outstanding. Prior to termination of the Trust, the Trustee
will begin to sell the Securities held in the Trust over a
period not to exceed 10 consecutive business days (the
"Liquidation Period"). Monies received upon such sale of
Securities will be held uninvested in non-interest bearing
accounts created by the Indenture until distributed pro rata to
Unit Holders on or about September 22, 1997, and will be of
benefit to the Trustee during such period. During the life of
the Trust, Securities will not be disposed of solely as a
result of normal fluctuations in market value. Because the
Trust is not managed and the Securities can only be sold during
the Liquidation Period or under certain other limited
circumstances described herein, the proceeds received from the
sale of Securities may be less than could be obtained if the
sale had taken place at a different time. Depending on the
volume of Securities sold and prices of and demand for
Securities at the time of such sale, the sales of Securities
from the Trust may tend to depress the market prices of such
Securities and hence the value of the Units, thus reducing
termination proceeds available to Unit Holders. In order to
mitigate potential adverse price consequences of heavy volume
trading in the Securities taking place over a short period of
time and to provide an average market price for the Securities,
the Trustee will follow procedures set forth in the Indenture
to sell the Securities in an orderly fashion over a period not
to exceed the Liquidation Period. The Sponsor can give no
A-4
<PAGE>
assurance, however, that such procedures will mitigate negative
price consequences or provide a better price for such
Securities. The Trust may terminate earlier than on the
Mandatory Termination Date if the value of the Trust is less
than the Discretionary Liquidation Amount set forth herein.
(See: "Administration of the Trust -- Termination".)
MONTHLY DISTRIBUTION -- Monthly distributions of
dividends and net capital gains, if any, received by the Trust
will be made on or shortly after the Distribution Date to Unit
Holders of record on the Record Date. Alternatively, Unit
Holders may elect to have their monthly distributions
reinvested under either of the Reinvestment Programs of the
Sponsor. (See: "Reinvestment Programs".)
PUBLIC OFFERING PRICE -- The Public Offering Price
per Unit is computed on the basis of the aggregate evaluation
of the underlying Securities next computed after receipt of a
purchase order plus cash on hand in the Trust, divided by the
number of Units outstanding, plus a sales charge of 3.359% of
such evaluation per Unit (the net amount invested); this
results in a sales charge of 3.25% 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 his 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 limited 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. Also, holders of common stock have the right to receive
dividends only when, as and if such dividends are declared by
the issuer's board of directors. Because the common stocks in
the Portfolio have been chosen for their 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 utility industry in particular. The Trust
is considered to be concentrated in gas and electric utility
stocks (100% of the aggregate market value of the Trust).
A-5
<PAGE>
Utility stocks are interest-rate-sensive and their prices may
closely follow the long-term bond market. In addition, some of
the issuers of the Portfolio Securities face construction,
regulatory, operating and financial risks associated with the
construction and operation of nuclear generating facilities.
(See: "The Trust -- Certain Risks Affecting Securities of
Utilities Companies".)
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 23 Securities, all of which are common
stocks, issued by companies in the utilities industry. The
Trust is therefore considered to be "concentrated" in the
stocks of utilities companies which are subject to certain
risks, some of which are described herein.
The Trust will be terminated on September 8, 1997,
regardless of market conditions at that time.
On September 19, 1995, based on the bid side of the
market, the aggregate market value of the Securities in the
Trust was $21,419,253.44.
SALES CHARGE -- The Sales Charge is 3.25% of the
Public Offering Price (3.359% 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, partnership or
corporation of at least $100,000, and the Sponsor will offer a
concession to dealers, pursuant to the following graduated
scales. (See: "Public Offering of Units -- Volume Discount".)
A-6
<PAGE>
Percent of Percent of
Public Offering Dealer Net Amount
Aggregate Value of Units Price Concession Invested
Less than $100,000.......... 3.25% 2.28% 3.359%
$100,000 to $249,999........ 3.00% 2.10% 3.093%
$250,000 to $499,999........ 2.75% 1.93% 2.828%
$500,000 to $749,999........ 2.50% 1.75% 2.564%
$750,000 to $999,999........ 2.25% 1.58% 2.302%
$1,000,000 or more.......... 2.00% 1.40% 2.041%
MINIMUM PURCHASE -- $1,000.
A-7
<PAGE>
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 7
INTRODUCTION
This series of the Dean Witter Select Equity Trust
(the "Trust") was created on August 18, 1992 (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 and Agreement (the "Indenture") and a related
Reference Trust Agreement (the "Agreement") (collectively, the
"Indenture and Agreement")<F31>, between Dean Witter Reynolds Inc.
(the "Sponsor") and United States Trust Company of New York,
the successor of which is The Chase Manhattan Bank (National
Association), (the "Trustee"). The Sponsor is a principal
operating subsidiary of Dean Witter Discover & Co. ("DWDC"), a
publicly-held corporation. (See: "Miscellaneous -- Sponsor",
herein.) The objectives of the Trust are to provide consistent
current income, potential for growth of income and capital
appreciation through investment in a fixed portfolio of
Securities (the "Portfolio") consisting of dividend paying
publicly traded common stock issued by domestic investor-owned
utility companies. There is no assurance that the objectives
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 with the Trustee and the execution of the
Indenture and Agreement. The Trustee then immediately
delivered to the Sponsor a certificate of beneficial interest
(the "Certificate") representing the units (the "Units")
comprising the entire ownership of the Trust. Through this
prospectus (the "Prospectus"), the Sponsor is offering the
Units, including Additional Units, as defined below, 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 secondary
market which the Sponsor, although not obligated to, proposes
to maintain. In addition, the Sponsor may offer for sale,
through this Prospectus, Units which the Sponsor may have
repurchased in the secondary market or upon the tender of such
Units for redemption. The Trustee has not participated in the
selection of Securities for the Trust, and neither the Sponsor
_________________________
<F31> Reference is hereby made to said Indenture and Agreement and any
statements contained herein are qualified in their entirety by the
provisions of said Indenture and Agreement.
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nor the Trustee will be liable in any way for any default,
failure or defect in any Securities.
With the deposit of the Securities in the Trust on
the Date of Deposit, the Sponsor established a proportionate
relationship between the number of shares of each Security in
the Portfolio. The Sponsor is permitted under the Indenture
and Agreement to deposit additional securities during the life
of the Trust, resulting in an increase in the number of Units
outstanding (the "Additional Units"). Such Additional Units
may be continuously offered for sale to the public by means of
this Prospectus. Any additional Securities deposited in the
Trust in connection with the sale of these Additional Units
will substantially maintain the proportionate relationship
between the number of shaes of each Security in the Portfolio
on the day of deposit of such additional Securities and any
cash not held for distribution to Unit Holders prior to the
deposit. The original proportionate relationships are subject
to adjustment under certain limited circumstances. (See:
"Administration of the Trust -- Portfolio Supervision",
herein.) The Sponsor may acquire large volumes of additional
Securities for deposit into the Trust over a short period of
time. Such acquisitions may tend to raise the market prices of
these Securities. The Sponsor cannot currently predict the
actual market impact of the Sponsor's purchases of additional
Securities, because the actual volume of Securities to be
purchased and the supply and price of such Securities is not
known.
On July 31, 1995, 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 Trust 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 Trust 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 interest in the Securities 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.
Issuance of additional Trust Units based on deposit
of additional Securities and cash in the Trust subsequent to
the Date of Deposit because of sale of additional Units by the
Sponsor does not change the pro rata interest in the Trust
assets attributable to pre-deposit Unit Holders because the
additional Securities and cash deposited have a net asset value
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per new Unit equal to the per Unit net asset value of the Units
outstanding immediately prior to the deposit of additional
Securities and cash. The additional Securities so received
will, however, have a tax cost basis to the Trust equal to
their values on the date of transfer to the Trust. Such tax
cost basis will likely differ from the tax cost basis of
Securities transferred to the Trust at other times such as the
Date of Deposit. The amount of gain or loss realized on sale
of a particular Security by the Trust depends upon the tax cost
basis of the particular Security sold. Hence, the amount of
capital gain or loss realized by the Trust and passed through
to Unit Holders will not be the same as the capital gain or
loss which would have been realized by a particular Unit Holder
if he, she or it had purchased and sold the Securities involved
with the intervention of the Trust. In addition, depending on
the timing of the purchase of Securities for the creation of
additional Units in relation to the record dates for the
payment of dividends on such Securities, the amount of net
dividend income distributed to Unit Holders during the quarter
in which the additional Units were created may be more or less
than the amount that would otherwise have been distributed had
such additional Units not been created.
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 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 no later than the Mandatory
Termination Date set forth in the "Summary of Essential
Information", and the Securities will be sold or distributed
in-kind, regardless of market conditions at that time. The
Trust may be terminated earlier under certain conditions (see:
"Administration of the Trust -- Termination", herein).
Summary Description of the Portfolio
As used herein, the term "Common Stocks" refers to
the common stocks deposited in the Trust and described under
"Schedule of Portfolio Securities". The term "Securities"
refers to the Common Stocks and includes any additional common
stocks subsequently acquired by the Trust pursuant to the
Indenture and Agreement. The Trust will not participate in any
dividend reinvestment plan of the issuer of any of the
Securities.
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An investment in Units of the Trust should be made
with an understanding that the value of the underlying
Securities, and therefore the value of Units, will fluctuate,
depending upon the full range of economic and market influences
which may affect the market value of such Securities. In
addition, utility stocks are interest-rate-sensitive and their
prices may closely follow the long-term bond market. Certain
risks are inherent in an investment in equity securities,
including the risk that the financial condition of one or more
of the issuers of the Securities may worsen or the general
condition of the common stock market may weaken. In such case,
the value of the Portfolio Securities and hence the value of
Units may decline. Common stocks are susceptible to general
stock market movements and to volatile and unpredictable
increases and decreases in value as market confidence in and
perceptions of the issuers change from time to time. Such
perceptions are based upon varying reactions to such factors as
expectations regarding domestic and foreign economic, monetary
and fiscal policies, inflation and interest rates, currency
exchange rates, economic expansion or contraction, and global
or regional political, economic or banking crises. In
addition, investors should understand that there are certain
payment risks involved in owning common stocks, 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 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, as 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 ordinarily 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
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interest (in the case of debt securities) and dividends (in the
case of preferred securities) 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. Additionally, market timing
and volume trading will also affect the underlying value of
Securities, including the Sponsor's buying of additional
Securities and the Trust's selling of Securities during the
Liquidation Period. The value of the Securities in the
Portfolio thus may be expected to fluctuate over the entire
life of the Trust to values higher or lower than those
prevailing on the Date of Deposit. The Sponsor may direct the
Trustee to dispose of Securities under certain specified
circumstances (see: "Administration of the Trust -- Portfolio
Supervision"). However, securities will not be disposed of
solely as a result of normal fluctuations in market value.
There can be no assurance that a market will be made
for any of the Securities, that any market for the Securities
will be maintained or of the liquidity of the Securities in any
markets made. In addition, the Trust may be restricted under
the Investment Company Act of 1940 from selling Securities to
the Sponsor. The price at which the Securities may be sold to
meet redemptions and the value of the Trust will be adversely
affected if trading markets for the Securities are limited or
absent.
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 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
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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. Issuers
relying upon hydroelectric generation may encounter
difficulties 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.
Some of the issuers of Securities in the Portfolio
own, operate or participate on a contractual basis with nuclear
generating facilities, which are licensed and regulated by the
Nuclear Regulatory Commission (the "NRC"). 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. 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.
Gas and Electric Utility Industry. The Trust is
considered to be "concentrated" in stocks of the gas and
electric 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,
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<PAGE>
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, 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 of 1992 (the "Act") is expected
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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 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. Certain 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
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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 objectives of the Trust are to provide for
consistent current income, potential for growth of income and
capital appreciation through an investment in a fixed
diversified portfolio of Securities. There is, of course, no
guarantee that the Trust's objectives will be achieved.
In selecting the Common Stocks for deposit in the
Trust on the Date of Deposit, the following factors, among
others, were considered by the Sponsor: (i) the quality of the
Common Stocks based upon the Sponsor's judgment which includes
an analysis of the possible risk of dividend impairment and
(ii) the yield and price of the Common Stocks relative to other
utility common stocks of comparable quality. Parameters are
set up to avoid companies with a) large amounts of nuclear or
oil generation, and b) significant investments in non-utility
lines of business.
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 Stock.) Throughout the life of the
Trust it is expected that these original 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 such 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
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to the provisions of the Indenture and Agreement 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 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 Trust's Securities may be disposed of only under limited
circumstances. (See: "Administration of the Trust --
Portfolio Supervision".)
Income and Distributions
The estimated net annual income is determined by
subtracting from the estimated 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. The net annual income 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 initially
deposited or to be deposited subsequently in the Trust.
Record Dates and Distribution Dates are set forth
under "Summary of Essential Information". 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 also be made monthly. 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
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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 Programs
(see: "Reinvestment Programs") will automatically be mailed to
such holder. Distributions for any Unit Holder of record 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. 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 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. If all or a portion of the Securities for
which advances have been made subsequently fail to make a
dividend payment, the Trustee may recoup advances made by it in
anticipation of receipt of dividend payments on such Securities
by reducing the amount otherwise distributable per Unit with
respect to a subsequent Distribution. 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%
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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
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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 Principal 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.
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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
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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.
Federal withholding taxes at a 30% rate or a lesser
rate established by treaty will generally apply to
distributions (other than distributions designated by the Trust
as capital gain dividends) made to Unit Holders that are
nonresident aliens or foreign partnerships, trusts or
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corporations unless the distributions constitute income
effectively connected with the conduct of a trade or business
within the United States by the distributee.
The value of Units held by an individual non-resident
alien, even though he is a non-resident at his death, will be
includible in his gross estate for U.S. federal estate tax
purposes.
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 calculated
daily, and 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". After the initial Date of Deposit,
a proportionate share of amounts in the Income and Principal
Accounts or amounts receivable in respect of stocks trading
ex-dividend (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 purchase of Units is
added to the Public Offering Price. In the event a stock is
trading ex-dividend at the time of deposit of additional
Securities, an amount not to exceed the dividend that would be
received if such stock were to receive a dividend will be added
to the Public Offering Price. The Public Offering Price per
Unit is calculated to five decimal places and rounded up or
down to four decimal places. The Public Offering Price on any
particular date will vary from the Public Offering Price on
July 31, 1995 (set forth in the "Summary of Essential
Information") in accordance with fluctuations in the aggregate
market value of the Securities, the amount of available cash on
hand in the Trust and the amount of certain accrued fees and
expenses.
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As more fully described in the Indenture and
Agreement, the aggregate market value of the Securities is
determined on each business day by the Trustee based on closing
prices on the day the valuation is made or, if there are no
such reported prices, by taking into account the same factors
referred to under "Redemption -- Computation of Redemption
Price". Determinations are effective for transactions effected
subsequent to the last preceding determination.
Public Distribution
Units issued on the Date of Deposit and Additional
Units issued in respect of additional deposits of Securities
will be distributed to the public by the Sponsor and through
dealers at the Public Offering Price determined as provided
above. Unsold Units or 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 through
dealers who are members of the National Association of
Securities Dealers, Inc. Sales to dealers will be made at the
full public offering price, subject to change from time to
time. The Sponsor reserves the right to reject, in whole or in
part, any order for the purchase of Units.
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, 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 sales charge incurred when a Unit
Holder sells Units back to the Sponsor. 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. Any profit or loss resulting from the
resale of such Units will belong to the Sponsor.
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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 Price". 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. The Sponsor may realize a profit
(or loss) in connection with each additional deposit of
Securities representing the difference between the cost of the
Securities to the Sponsor and the cost of the Securities to the
Trust. In addition, the Sponsor may have acted as broker in
transactions relating to the purchase of Securities for deposit
in the Trust. 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 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 Sponsor may at any time change
the amount by which the sales charge is reduced, or may
discontinue the discount altogether.
The sales charge of 3.25% of the Public Offering
Price will be reduced for sales to any person of at least
$100,000, and the Sponsor will offer a concession to dealers,
pursuant to the following graduated scales.
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Sales Charge
Percent of Percent of
Public Offering Dealer Net Amount
Aggregate Value of Units Price Concession Invested
Less than $100,000.......... 3.25% 2.28% 3.359%
$100,000 to $249,999........ 3.00% 2.10% 3.093%
$250,000 to $499,999........ 2.75% 1.93% 2.828%
$500,000 to $749,999........ 2.50% 1.75% 2.564%
$750,000 to $999,999........ 2.25% 1.58% 2.302%
$1,000,000 or more.......... 2.00% 1.40% 2.041%
The reduced sales charges as shown on the chart above
will apply to all purchases of Units of this Trust only on any
one day by the same person, partnership or corporation (other
than a dealer) in the amounts stated herein.
Units held in the name of the purchaser's spouse or
in the name of a purchaser's child under the age of 21 years
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 Corporate Trust and the
Dean Witter Select Investment 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.
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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
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accrued interest and the applicable sales charge of $25 per
Unit (or per 100 Units in the case of a unit priced at about
$10.00 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.
REINVESTMENT PROGRAMS
Unit Holders may elect to have monthly distributions
with respect to their Units (rounded down to the nearest
dollar) automatically reinvested in either additional Units of
the Trust with a sales charge equal to 1.0% of the amount
reinvested or shares of the Dean Witter U.S. Government Money
Market Trust, without a sales charge. The Dean Witter U.S.
Government Money Market Trust is composed primarily of
high-yielding short-term government securities that are managed
by the InterCapital Division of the Sponsor. For more
information concerning the programs, the Unit Holder should
contact an account executive of the Sponsor. The Unit Holder
may participate in either of the Trust's reinvestment programs
(a "Program") by filing with the Trustee a written notice of
election. The Unit Holder's completed notice of election to
participate in a Program must be received by the Trustee at
least ten days prior to the Record Day applicable to any
distribution in order for a Program to be in effect as to such
distribution. Elections may be modified or revoked on similar
notice.
Such distributions, to the extent reinvested in the
Trust, will be used by the Trustee at the direction of the
Sponsor in one or both of the following manners. (i) The
distributions may be used by the Trustee to purchase Units of
this Series of the Trust held in the Sponsor's inventory. The
purchase price payable by the Trustee for each of such Units
will be equal to the applicable Trust evaluation per Unit on
(or as soon as possible after) the close of business on the
Distribution Date, plus a sales charge of 1.0% of the amount
reinvested. The Units so purchased by the Trustee will be
issued or credited to the accounts of Unit Holders
participating in the Program. (ii) If there are no Units in
the Sponsor's inventory, the Sponsor may purchase additional
Securities in order to maintain, as closely as practical, the
original proportionate relationship between the number of
shares of each Security in the Trust. The additional
securities will be deposited by the Sponsor with the Trustee in
exchange for new Units. The distributions may then be used by
the Trustee to purchase the new Units from the Sponsor. The
price for such new Units will be the applicable Trust
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evaluation per Unit on (or as soon as possible after) the close
of business on the Distribution Date, plus a sales charge of
1.0% of the amount reinvested. (See: "Public Offering --
Public Offering Price".) The Units so purchased by the Trustee
will be issued or credited to the accounts of Unit Holders
participating in the Program. The Sponsor may terminate the
program when it does not have sufficient Units in its inventory
and it is no longer deemed practical to purchase additional
Securities of the same general type as are held in the Trust
just prior to purchase. Thereafter, distributions received by
the Trust would be distributed in monthly installments to all
Unit Holders.
No fractional Units will be issued 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 for the benefit of such Unit Holder and shall apply such
cash on the next Distribution Day, along with any distributions
then made, toward the purchase of additional full Units in
accordance with the Program. The cost of administering the
program will be borne by the Trust and thus will be borne
indirectly by all Unit Holders.
REDEMPTION
Right of Redemption
One or more Units represented by a Certificate may be
redeemed at the Redemption Price upon tender of such
Certificate to the Trustee at its unit investment trust office
in the City of New York, 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 its Units for redemption at any time after the
settlement date for purchase, whether or not it has received a
definitive Certificate. The Redemption Price per Unit is
calculated as set forth under "Computation of Redemption
Price", herein. There is no sales charge incurred when a Unit
Holder tenders its Units to the Trustee for redemption.
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 by the Trustee as of the
Evaluation Time on the date of tender.
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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 next business day following
such presentation.
Units will be redeemed by the Trustee solely in cash
for any one Unit Holder tendering less than 25,000 Units. With
respect to redemption requests regarding at least 25,000 Units,
the Sponsor may determine, in its discretion, to direct the
Trustee to redeem Units "in kind" by distributing Portfolio
Securities to the redeeming Unit Holder. The Sponsor may
direct the Trustee to redeem Units "in kind" even if it is then
maintaining a secondary market in Units of the Trust. Unit
Holders redeeming "in kind" will receive an amount and value of
Trust Securities per Unit equal to the Redemption Price Per
Unit as determined as of the Evaluation Time next following the
tender as set forth herein under "Computation of Redemption
Price", below. The distribution "in kind" for redemption of
Units will be held by the Trustee for the account of, and for
disposition in accordance with the instructions of, the
tendering Unit Holder. The tendering Unit Holder will be
entitled to receive whole shares of each of the underlying
Portfolio Securities, plus cash equal to the Unit Holder's pro
rata share of the cash balance of the Income and Principal
Accounts and cash from the Principal Account equal to the
fractional shares to which such tendering Unit Holder is
entitled. The Trustee, in connection with implementing the
redemption "in kind" procedures outlined above, may make any
adjustments necessary to reflect differences between the
Redemption Price of Units and the value of the Securities
distributed "in kind" as of the date of tender. If the
Principal Account does not contain amounts sufficient to cover
the required cash distribution to the tendering Unit Holder,
the Trustee is empowered to sell Securities in the Trust
Portfolio in the manner discussed below. A Unit Holder
receiving redemption distributions of Securities "in kind" may
incur brokerage costs in converting Securities so received into
cash.
The portion of the Redemption Price which represents
the Unit Holder's interest in the Income Account shall be
withdrawn from the Income Account to the extent available. The
balance paid on any redemption, including dividends receivable
on stocks trading ex-dividend, if any, shall be drawn from the
Principal Account to the extent that funds are available for
such purpose. The Trustee is authorized by the Indenture and
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 the time when Securities would not otherwise be
sold and might result in lower prices than might otherwise be
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realized. The Redemption Price received by a tendering Unit
Holder may be more or less than the purchase price originally
paid by such Unit Holder, depending on the value of the
Securities in the Portfolio at the time of redemption.
Moreover, due to the minimum lot size 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 on the Distribution Date.
Securities to be sold for purposes of redeeming Units
will be selected from a list supplied by the Sponsor. If not
so instructed by the Sponsor, the Trustee will select the
Securities to be sold so as to maintain, as closely as
practicable, the original proportionate relationship between
the number of shares of each Security in the Trust.
Computation of Redemption Price
The Trust Evaluation per Unit is determined as of the
Evaluation Time stated under "Summary of Essential
Information", above, and (a) semiannually, on the last business
day of each of the months of June and December, (b) on the day
on which any Unit of the Trust is tendered for redemption
(unless tender is made after the Evaluation Time on such day,
in which case Tender shall be deemed to have been made on the
next day subsequent thereto on which the New York Stock
Exchange is open for trading) and (c) on any other business day
desired by the Sponsor or the Trustee,
(1) by adding:
a. The aggregate value of Securities in the Trust,
as determined by the Trustee;
b. Cash on hand in the Trust, including dividends
receivable on stocks trading ex-dividend, other than money
deposited to purchase Securities or money credited to the
Reserve Account; and
c. All other assets of the Trust; 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
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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 Price
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 valuation shall be based on the
closing price on such Exchange which is the principal market
thereof deemed to be the New York Stock Exchange if the
Securities are listed thereon (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 such exchange or there
is no closing price on such exchange, such valuation shall be
based on the closing price in the over-the-counter market
(unless the Trustee deems such price inappropriate as a basis
for valuation) or if there is no such closing price, by any of
the following methods which the Trustee deems appropriate: (i)
on the basis of current bid prices of such Securities as
obtained from investment dealers or brokers (including the
Depositor) who customarily deal in securities comparable to
those held by the Trust, or (ii) if bid prices are not
available for any of such Securities, on the basis of bid
prices for comparable securities, or (iii) by appraisal of the
value of the Securities on the bid side of the market or by
such other appraisal as is deemed appropriate, or (iv) by any
combination of the above.
Postponement of Redemption
The right of redemption may be suspended and payment
of the Redemption Price 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.
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RIGHTS OF UNIT HOLDERS
Unit Holders
A Unit Holder is deemed to be a beneficiary of the
Trust created by the Indenture and Agreement and vested with
all right, title and interest in the Trust created therein. 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 unit investment 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.
Under the terms and conditions and at such times as
are permitted by the Trustee, Units may also be held in
uncertificated form. The rights of any holder of Units held in
uncertificated form shall be the same as those of any other
Unit Holder.
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",
herein). 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
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any third party for any action taken by the Trustee or Sponsor.
Unit Holders will be unable to dispose of any of the Securities
in the Portfolio, as such, and will not be able to vote the
Securities. The Trustee, as holder of the Securities, will
have the right to vote all of the voting Securities held in the
Trust, and will vote such Securities in accordance with the
instructions of the Sponsor, if given, otherwise the Trustee
shall vote as it, in its sole discretion, shall determine.
EXPENSES AND CHARGES
Fees
The Sponsor's fee, earned for portfolio supervisory
services, is based upon the largest number of Units outstanding
during the monthly computation period. The Sponsor's fee, as
set forth under "Summary of Essential Information", 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, the Trustee receives the fee set forth under "Summary
of Essential Information". Certain regular expenses of the
Trust, including certain mailing and printing expenses, are
borne by the Trust.
The Sponsor's fee and the Trustee's fees accrue daily
but are payable only on or before each Distribution Date from
the Income Account, to the extent funds are available and
thereafter from the Principal 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 or, if no longer published, a similar
index. The Trustee, pursuant to normal banking procedures,
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) 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
27
<PAGE>
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, wilful malfeasance or wilful 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, wilful
malfeasance or wilful misconduct or reckless disregard of its
obligations and duties, (g) expenditures incurred in contacting
Unit Holders upon termination of the Trust, (h) brokerage
commissions or charges incurred in connection with the purchase
or sale of Securities and (i) to the extent there lawful,
expenses (including legal, auditing and printing expenses) of
maintaining registration or qualification of the Units and/or
the Trust under Federal or state securities laws so long as the
Sponsor is maintaining a market for the Units.
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
Principal 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 lot size 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.
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 770 Broadway, New York, New York 10003. 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, computer book-entry
transfer and institutional delivery services. The Depository
28
<PAGE>
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.
Distribution
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 such as return of
principal and gain and including amounts received upon the
sale, pursuant to the Indenture and Agreement, of rights to
purchase other Securities distributed in respect of the
Securities in the Portfolio, are credited to a Principal
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 the
estimated annual dividend income per Unit to be received by the
Trust during the ensuing twelve months, after deducting
estimated expenses, plus such holder's pro rata share of the
distributable cash balance of the Principal 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 will be held in the
Principal Account to be distributed on the Distribution Date
following receipt of such proceeds. No distribution need be
made from the Principal Account if the balance therein is less
than $1.00 per 100 Units outstanding. A Reserve Account may be
created by the Trustee by withdrawing from the Income or
Principal 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 are non-interest bearing to Unit Holders.
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,
merger, reorganization 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
29
<PAGE>
governed solely by the provisions of the Indenture and
Agreement. The Sponsor may direct the Trustee to dispose of
Securities upon failure of the issuer of a Security in the
Trust 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, the occurrence of other
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 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.
During the life of the Trust, the Sponsor, as part of
its administrative responsibilities, shall conduct reviews to
determine whether or not to recommend the disposition of
Securities. In addition, the Sponsor shall undertake to
perform such other reviews and procedures as it may deem
necessary in order for it 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 performed 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 "Summary of Essential Information".
Voting of the Portfolio Securities
Pursuant to the Indenture and Agreement, voting
rights with respect to the Portfolio Securities and Replacement
Securities, if any, will be exercised by the Trustee in
accordance with the directions given by the Sponsor.
Reports to Unit Holders
With each distribution, the Trustee will furnish to
Unit Holders a statement of the amount of income and other
receipts distributed, including the proceeds of the sale of the
Securities, expressed in each case as a dollar amount per Unit.
Within a reasonable period of time after the last
business day in each calendar year, but not later than
February 15, 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:
30
<PAGE>
1. As to the Income and Principal Accounts:
(a) the amount of income received on the Securities;
(b) the amount paid for redemption of Units;
(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 distributed from the Income Account;
(e) any other amount credited or deducted from the
Income Account; and
(f) 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 as of the last business
day of such calendar year;
(b) the number of Units outstanding as of the last
business day of such calendar year;
(c) the Unit Value (as defined in the Agreement)
based on the last Evaluation made during such calendar
year; and
(d) the amounts actually distributed during such
calendar year from the Income and Principal Accounts,
separately stated, expressed both as total dollar amounts
and as dollar amounts per Unit outstanding on the Record
Dates for such distributions.
Amendment
The Indenture and Agreement may be amended from time
to time by the Trustee and the Sponsor or their respective
successors, without the consent of any of the Unit Holders (a)
to cure any ambiguity or to correct or supplement any provision
contained therein which may be defective or inconsistent with
any other provision contained therein; (b) to change any
provision thereof as may be required by the Securities and
Exchange Commission or any successor governmental agency
exercising similar authority; (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 to prevent the applicability of the 4% excise
31
<PAGE>
tax imposed by Section 4982 of the Code; or (d) to make such
other provision in regard to matters or questions arising
thereunder as shall not adversely affect the interest of the
Unit Holders; provided, that the Indenture and Agreement may
also be amended from time to time by the parties thereto (or
the performance of any of the provisions of this Indenture may
be waived) with the expressed written consent of Unit Holders
evidencing 51% of the Units at the time outstanding under the
Indenture for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of
the Indenture and Agreement or of modifying in any manner the
rights of the Unit Holders; provided, further however, that the
Indenture and Agreement may not be amended (nor may any
provision thereof be waived) so as to (1) increase the number
of Units issuable in respect of the Trust above the aggregate
number specified in Part II of the Agreement or such lesser
amount as may be outstanding at any time during the term of the
Indenture, except as the result of the deposit of Additional
Securities, as therein provided, or reduce the relative
interest in the Trust of any Unit Holder without his consent,
or (2) permit the deposit or acquisition thereunder of
securities or other property either in addition to or in
substitution for any of the Securities except in the manner
permitted by the Trust Indenture as in effect on the date of
the first deposit of Securities or permit the Trustee to engage
in business or investment activities not specifically
authorized in the Indenture and Agreement as originally
adopted.
Termination
The Indenture and Agreement provides that the Trust
will be liquidated during the Liquidation Period as set forth
under "Summary of Essential Information", herein, and
terminated at the end of such period. Additionally, if the
value of the Trust as shown by any Evaluation is less than
forty percent (40%) of the value of the Securities deposited in
the Trust on the Date of Deposit and thereafter, 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 Unit Holders owning 51% or more of the Units
then outstanding. Unit Holders will receive their final
distributions (that is, their pro rata distributions realized
from the sale of Portfolio Securities plus any other Trust
assets, less Trust expenses) according to their Election
Instructions. The Election Instructions will provide for the
following distribution options: (1) cash distributions; or (2)
distributions "in kind" available only to any Unit Holder
owning at least 25,000 Units. Unit Holders who do not tender
properly completed Election Instructions to the Trustee will be
deemed to have elected a cash distribution.
32
<PAGE>
Cash or "In Kind" Distributions. Unit Holders
holding less than 25,000 Units will receive distributions in
respect of their Units at termination solely in cash. Unit
Holders holding at least 25,000 Units may indicate to the
Trustee that they wish to receive termination distributions "in
kind", by returning to the Trustee properly completed Election
Instructions distributed by the Trustee to such Unit Holders of
record 45 days prior to the Termination Date. The Trustee will
duly honor such election instructions received on or before the
Mandatory Termination Date. Such Unit Holder will be entitled
to receive whole shares of each of the underlying Portfolio
Securities and cash from the Principal Account equal to the
fractional shares to which such tendering Unit Holder is
entitled. A Unit Holder receiving distributions of Securities
"in kind" may incur brokerage costs in converting Securities so
received into cash. The Trustee will transfer the Securities
to be delivered in kind to the account of, and for disposition
in accordance with the instructions of, the Unit Holder.
Method of Securities Disposal. The Trustee will
begin to sell the remaining Securities held in the Trust on the
next business day following the In-Kind Date. Since the Trust
is not managed, Securities in the Portfolio must be sold in
accordance with the Indenture, which provides for sales over a
period of days or on any one day during the Liquidation Period
set forth in the "Summary of Essential Information". Daily
proceeds of such sales will be deposited into the Trust, will
be held in a non-interest bearing account until distributed and
will be of benefit to the Trustee. The sales of Portfolio
Securities may tend to depress the market prices for such
Securities and thus reduce the proceeds available to Unit
Holders. The Sponsor believes that gradual liquidation of
Securities during the Liquidation Period may mitigate negative
market price consequences stemming from the trading of large
volumes of Securities over a short period of time. There can
be no assurance, however, that such procedures will effectively
mitigate any adverse price consequences of heavy volume trading
or that such procedures will produce a better price for Unit
Holders than might have been obtained had all the Securities
been sold on one particular day during the Liquidation Period.
The Trustee will, after deduction of brokerage
charges and costs incurred in connection with the sale of
Securities, 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 its Certificate after due notice of such termination, such
Unit Holder's pro rata share in the Income and Principal
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,
33
<PAGE>
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, 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.
However, the Trustee shall be liable for wilful misfeasance,
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. 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 such
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, wilful
misconduct, wilful misfeasance 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 of 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, or if the Trustee has materially failed to perform
its duties under the Indenture and Agreement and the interest
of the Unit Holders has been impaired as a result, 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.
34
<PAGE>
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
wilful misfeasance, wilful 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) terminate the Trust Indenture and Agreement
and the Trust and liquidate the Trust. 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-held 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 commodities 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 in The Chase Manhattan Bank (National
Association), a national banking association with its principal
35
<PAGE>
executive office located at 1 Chase Manhattan Plaza, New York,
New York 10081 and its unit investment trust office at 770
Broadway, New York, New York 10003. 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
The legality of the Units offered hereby has 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 Statement of Financial Condition 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.
36
<PAGE>
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
THE UNIT HOLDERS, SPONSOR AND TRUSTEE
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 7
We have audited the statement of financial condition and schedule of
portfolio securities of the Dean Witter Select Equity Trust Utility Stock
Series 7 as of July 31, 1995, and the related statements of operations and
changes in net assets for the years ended July 31, 1995 and 1994 and the
period from August 18, 1992 (date of deposit) to July 31, 1993. 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 July 31,
1995 as shown in the statement of financial condition and schedule of
portfolio securities by correspondence with The Chase Manhattan Bank, N.A.
(formerly United States Trust Company of New York), 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 7 as of July 31, 1995, and the results of
its operations and the changes in its net assets for the years ended
July 31, 1995 and 1994 and the period from August 18, 1992 (date of deposit)
to July 31, 1993 in conformity with generally accepted accounting
principles.
DELOITTE & TOUCHE LLP
September 15, 1995
New York, New York
F-1
</AUDIT-REPORT>
<PAGE> STATEMENT OF FINANCIAL CONDITION
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 7
July 31, 1995
TRUST PROPERTY
Investments in securities at market value (cost
$24,110,844) (Note (a) and Schedule of
Portfolio Securities Notes (3) and (4)) $21,421,008
Accrued dividends receivable 104,520
Cash 4,479
Total 21,530,007
LIABILITY AND NET ASSETS
Less Liability:
Accrued Trust fees and expenses 2,720
Net Assets:
Balance applicable to 24,775,000 Units
(Note (c)):
Capital, less net unrealized market
depreciation of $2,689,836 $21,421,008
Undistributed principal and net
investment income (Note (b)) 106,279
Net assets $21,527,287
Net asset value per Unit ($21,527,287 divided
by 24,775,000 Units) $ .8689
See notes to financial statements
F-2
<PAGE>
STATEMENTS OF OPERATIONS
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 7
For the period from
August 18, 1992
For the years ended July 31, (date of deposit)
1995 1994 to July 31, 1993
Investment income -
dividends $1,627,912 $ 2,086,896 $1,549,197
Less Expenses:
Trust fees and expenses 47,099 64,515 33,738
Total expenses 47,099 64,515 33,738
Investment
income -net 1,580,813 2,022,381 1,515,459
Net gain (loss) on invest-
ments:
Realized loss on
securities sold
or redeemed (1,099,345) (657,823) -
Net unrealized market
appreciation
(depreciation) 2,512,156 (8,354,998) 3,153,006
Net gain (loss)
on investments 1,412,811 (9,012,821) 3,153,006
Net increase (decrease) in
net assets resulting
from operations $2,993,624 $(6,990,440) $4,668,465
See notes to financial statements
F-3
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 7
For the period from
August 18, 1992
For the years ended July 31,(date of deposit)
1995 1994 to July 31, 1993
Operations:
Investment income - net $ 1,580,813 $ 2,022,381 $ 1,515,459
Realized loss on securi-
ties sold or redeemed (1,099,345) (657,823) -
Net unrealized market
appreciation
(depreciation) 2,512,156 (8,354,998) 3,153,006
Net increase
(decrease) in
net assets
resulting from
operations 2,993,624 (6,990,440) 4,668,465
Less Distributions to Unit
Holders:
Principal - (93,297) -
Investment income - net (1,587,222) (2,080,594) (1,289,991)
Total distribu-
tions (1,587,222) (2,173,891) (1,289,991)
Less Capital Share
Transactions:
Creation of 40,250,000
Units - - 39,371,831
Redemption of 6,955,000
Units and 8,770,000
Units,respectively (5,713,700) (7,952,023) -
Accrued investment
income on redemption (15,807) (21,209) -
Net capital share
transactions (5,729,507) (7,973,232) 39,371,831
Net (decrease) increase
in net assets (4,323,105) (17,137,563) 42,750,305
Net assets:
Beginning of period
(Note (c)) 25,850,392 42,987,955 237,650
End of period (including
undistributed principal
and net investment
income of $106,279,
$126,500 and $225,468,
respectively) $21,527,287 $25,850,392 $42,987,955
See notes to financial statements
F-4
<PAGE>
NOTES TO FINANCIAL STATEMENTS
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 7
July 31, 1995
(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
or on the over-the-counter market, on the last day of trading
during the period. The value on the date of initial deposit
(August 18, 1993) represents the cost of investments to the Trust
based on the closing sale price on the New York Stock Exchange or
the closing sale price on the over-the-counter market. The cost of
investments purchased subsequent to the date of initial deposit
is based on the closing sale price on the New York Stock Exchange
or the over-the-counter market on date of purchase.
(3) Income Taxes
No provision for Federal income taxes has been made in the
accompanying financial statements because the Trust has elected
and 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.
F-5
<PAGE>
NOTES TO FINANCIAL STATEMENTS
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 7
July 31, 1995
(4) Expenses
The Trust pays annual Trustee's fees, 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.
(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 his pro rata
share of the Trust's assets, less expenses, in the manner set forth
under "Administration of the Trust - Termination" in this Prospectus.
(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 July 31, 1995 follows:
Cost of 250,000 Units at date of initial deposit $ 248,199
Less: Gross underwriting commissions (sales charge) (10,549)
Net cost to investors at initial deposit 237,650
Cost of 40,250,000 additional Units at date of deposit 39,371,831
Cost of securities sold or redeemed (15,498,637)
Net unrealized market depreciation (2,689,836)
Net amount applicable to investors $21,421,008
F-6
<PAGE>
NOTES TO FINANCIAL STATEMENTS
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 7
July 31, 1995
(e) OTHER INFORMATION
Selected data for a Unit of the Trust during each period:
For the period from
For the August 18, 1992
years ended July 31, (date of deposit)
1995 1994 to July 31, 1993
Principal distribu-
tions during period $ - $.0025 $ -
Net investment income
distributions during
period $.0557 $.0569 $ .0514
Net asset value at
end of period $.8689 $.8147 $1.0614
Trust Units out-
standing at end
of period 24,775,000 31,730,000 40,500,000
F-7
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE OF PORTFOLIO SECURITIES
DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES 7
July 31, 1995
Current
Annual Market Percentage of
Port- Number Dividend Price per Aggregate Market
folio of Per Share to Market Value Value
No. Name of Issuer Shares Share<F4> Yield<<F5> Trust of Trust <F6><F7>
<S> <C> <C> <C> <C> <C> <C> <C>
1. (AEP) American Electric Power
Co., Inc. 39,443 $2.40 6.957% $34.50 6.35% $ 1,360,784
2. (BKH) Black Hills Corp. 29,584 1.34 5.583 24.00 3.31 710,016
3. (BSE) Boston Edison Co. 29,584 1.82 7.280 25.00 3.45 739,600
4. (CIP) CIPSCO Inc. 49,302 2.04 6.945 29.375 6.76 1,448,246
5. (CNL) Central Louisiana
Electric Co., Inc. 39,444 1.50 6.383 23.50 4.33 926,934
6. (CTP) Central Maine Power Co. 69,019 .90 7.660 11.75 3.79 810,973
7. (CSR) Central & South West
Corp. 29,584 1.72 6.745 25.50 3.52 754,392
8. (DPL) DPL Inc. 44,373 1.24 5.573 22.25 4.61 987,299
9. (DTE) Detroit Edison Co. 19,727 2.06 6.983 29.50 2.72 581,947
10. (KU) KU Energy Corp. 29,584 1.68 6.340 26.50 3.66 783,976
11. (NES) New England Electric
System 19,727 2.36 7.019 33.625 3.10 663,320
12. (NGE) New York State Electric
& Gas Corp. 49,302 1.40 5.989 23.375 5.38 1,152,434
13. (NSP) Northern States Power
Co. 19,727 2.70 6.102 44.25 4.07 872,920
14. (OTTR) Otter Tail Power Co. 29,584 1.76 5.374 32.75 4.52 968,876
15. (PCG) Pacific Gas & Electric
Co. 19,727 1.96 6.644 29.50 2.72 581,947
16. (PSD) Puget Sound Power &
Light Co. 59,160 1.84 8.558 21.50 5.94 1,271,940
17. (SDO) San Diego Gas & Electric
Co. 29,584 1.56 7.298 21.375 2.95 632,358
18. (SO) Southern Co. 39,445 1.22 5.545 22.00 4.05 867,790
19. (SIG) Southern Indiana Gas
& Electric Co. 19,727 1.69 5.474 30.875 2.84 609,071
20. (UEP) Union Electric Co. 19,727 2.44 6.873 35.50 3.27 700,308
21. (WR) Western Resources, Inc. 49,302 2.02 6.623 30.50 7.02 1,503,711
22. (CIN) Cinergy Corp. <F8> 73,949 1.72 6.615 26.00 8.98 1,922,674
23. (PPL) PP&L Resources, Inc. <F9> 29,584 1.67 8.675 19.25 2.66 569,492
$21,421,008
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 7
July 31, 1995
[FN]
<F4>Based on the latest quarterly declaration. There can be no
assurance that future dividend payments, if any, will be
maintained in an amount equal to the dividend listed.
<F5>The Yield represents the Current Annual Dividend per Share divided
by the Market Price per Share.
<F6>Valuation of Securities by the Trustee was made on the basis of the
closing sale price on the New York Stock Exchange as of July 31,
1995, except Portfolio No. 14 which was valued at the closing sale
price on the over-the-counter market.
<F7>At July 31, 1995, the net unrealized market depreciation of
Securities was comprised of the following:
Gross unrealized market appreciation $ 271,477
Gross unrealized market depreciation (2,961,313)
Net unrealized market depreciation $(2,689,836)
The aggregate cost of the Securities to the Trust for Federal
income tax purposes was $24,110,844 at July 31, 1995.
<F8> On October 24, 1994, Cincinnati Gas and Electric Co. merged with
PSI Resources, Inc. to create Cinergy Corp. The exchange rate
between Cincinnati Gas and Electric Co. and Cinergy Corp. was one
for one.
<F9> Effective April 27, 1995, Pennsylvania Power and Light Co. became a
subsidiary of PP&L Resources, Inc., a holding company. Each of
the Utility's common shares was deemed to represent one common
share of the holding company.
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 exhibits:
23. 1b. Consent of Independent Auditors.
27. Financial Data Schedule.
<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 Exhibit 5 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 7, 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. 3 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 28th day of September, 1995.
DEAN WITTER SELECT EQUITY TRUST,
UTILITY STOCK SERIES 7
(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. 3 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 28th day of September,
1995.
DEAN WITTER REYNOLDS INC.
Name Office
Philip J. Purcell Chairman and Chief)
Executive Officer )
and Director<F32> )
By: Thomas Hines
Thomas Hines
Attorney-in-fact<F32>
_________________________
<F32> Executed copies of the Powers of Attorney have been filed with the
Securities and Exchange Commission in connection with the
Registration Statement on Form S-6 for File No. 33-56389.
<PAGE>
Name Office
Richard M. DeMartini Director<F32>
Nancy S. Donovan Director<F32>
Robert J. Dwyer Director<F32>
Christine A. Edwards Director<F32>
James F. Higgins Director<F32>
Stephen R. Miller Director<F32>
Richard F. Powers Director<F32>
Philip J. Purcell Director<F32>
_________________________
<F32> Executed copies of the Powers of Attorney have been filed with the
Securities and Exchange Commission in connection with the
Registration Statement on Form S-6 for File No. 33-56389.
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. TITLE OF DOCUMENT
23. 1b. Consent of Deloitte & Touche LLP
27. Financial Data Schedule
<PAGE>
EXHIBIT 23.1b.
CONSENT OF INDEPENDENT AUDITORS
We consent to the use of our report dated September 15, 1995, accompanying the
financial statements of the Dean Witter Select Equity Trust Utility Stock
Series 7 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
September 28, 1995
New York, New York
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<LEGEND> THE SCHEDULE CONTAINS SUMMARY FINANCIAL
INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS FOR DEAN WITTER SELECT
EQUITY TRUST UTILITY STOCK SERIES 7
AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS
<RESTATED>
<SERIES>
<NAME> DEAN WITTER SELECT EQUITY TRUST
UTILITY STOCK SERIES
<NUMBER> 7
<MULTIPLIER> 1
<FISCAL-YEAR-END> Jul-31-1995
<PERIOD-START> Aug-1-1994
<PERIOD-END> Jul-31-1995
<PERIOD-TYPE> YEAR
<INVESTMENTS-AT-COST> 24,110,844
<INVESTMENTS-AT-VALUE> 21,421,008
<RECEIVABLES> 104,520
<ASSETS-OTHER> 4,479
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 21,530,007
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 2,720
<TOTAL-LIABILITIES> 2,720
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 24,093,424
<SHARES-COMMON-STOCK> 24,775,000
<SHARES-COMMON-PRIOR> 31,730,000
<ACCUMULATED-NII-CURRENT> 123,699
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (2,689,836)
<NET-ASSETS> 21,527,287
<DIVIDEND-INCOME> 1,627,912
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 47,099
<NET-INVESTMENT-INCOME> 1,580,813
<REALIZED-GAINS-CURRENT> (1,099,345)
<APPREC-INCREASE-CURRENT> 2,512,156
<NET-CHANGE-FROM-OPS> 2,993,624
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 1,587,222
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 6,955,000
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (4,323,105)
<ACCUMULATED-NII-PRIOR> 144,048
<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>
