Registration File No.: 33-15283
Schedule 14A Information required in proxy statement.
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No.__)
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[ ] Soliciting Material Pursuant to Section 240.149-11(c) or
Section 240.14a-12
....Municipal Income Trust . . . . . . . . . . . . . . . . . . .
(Name of Registrant as Specified in its Charter)
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Set forth the amount on which the filing fee is calculated and state how
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<PAGE>
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<PAGE>
MUNICIPAL INCOME TRUST
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 27, 1996
The Annual Meeting of Shareholders of MUNICIPAL INCOME TRUST (the
"Trust"), an unincorporated business trust organized under the laws of the
Commonwealth of Massachusetts, will be held in the Conference Center,
Forty-Fourth Floor, 2 World Trade Center, New York, New York 10048, on
December 27, 1996, at 2:00 p.m., New York City time, for the following
purposes:
1. To elect two (2) Trustees to serve until the 1999 Annual Meeting or
until their successors shall have been elected and qualified;
2. To approve or disapprove continuance of the Investment Advisory
Agreement between the Trust and Dean Witter InterCapital Inc.;
3. To ratify or reject the selection of Price Waterhouse LLP as the
Trust's independent accountants for the fiscal year ending August 31,
1997;
4. Shareholder proposal to amend the Trust's Declaration of Trust to
require each Trustee, within thirty days of election, to become a
Shareholder of the Trust (Note: The Trustees unanimously recommend a vote
AGAINST this proposal); and
5. To transact such other business as may properly come before the
Meeting or any adjournments thereof.
Shareholders of record as of the close of business on October 25, 1996 are
entitled to notice of and to vote at the Meeting. If you cannot be present in
person, your management would greatly appreciate your filling in, signing and
returning the enclosed proxy promptly in the envelope provided for that
purpose.
In the event that the necessary quorum to transact business or the vote
required to approve or reject any proposal is not obtained at the Meeting,
the persons named as proxies may propose one or more adjournments of the
Meeting for a total of not more than 60 days in the aggregate to permit
further solicitation of proxies. Any such adjournment will require the
affirmative vote of the holders of a majority of the Trust's shares present
in person or by proxy at the Meeting. The persons named as proxies will vote
in favor of such adjournment those proxies which they are entitled to vote in
favor of the proposal to approve continuance of the Investment Advisory
Agreement and will vote against such adjournment those proxies required to be
voted against that proposal.
SHELDON CURTIS,
Secretary
November 7, 1996
New York, New York
- -------------------------------------------------------------------------------
IMPORTANT
YOU CAN HELP AVOID THE NECESSITY AND EXPENSE OF SENDING FOLLOW-UP LETTERS
TO ENSURE A QUORUM BY PROMPTLY RETURNING THE ENCLOSED PROXY. IF YOU ARE
UNABLE TO BE PRESENT IN PERSON, PLEASE FILL IN, SIGN AND RETURN THE ENCLOSED
PROXY IN ORDER THAT THE NECESSARY QUORUM MAY BE REPRESENTED AT THE MEETING.
THE ENCLOSED ENVELOPE REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
- -------------------------------------------------------------------------------
<PAGE>
MUNICIPAL INCOME TRUST
TWO WORLD TRADE CENTER, NEW YORK, NEW YORK 10048
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
DECEMBER 27, 1996
This statement is furnished in connection with the solicitation of proxies
by the Board of Trustees (the "Board") of MUNICIPAL INCOME TRUST (the
"Trust"), for use at the Annual Meeting of Shareholders of the Trust to be
held on December 27, 1996 (the "Meeting"), and at any adjournments thereof.
If the enclosed form of proxy is properly executed and returned in time to
be voted at the Meeting, the proxies named therein will vote the shares
represented by the proxy in accordance with the instructions marked thereon.
Unmarked proxies will be voted for each of the nominees for election as
Trustee and in favor of Proposals 2, 3 and against Proposal 4. A proxy may be
revoked at any time prior to its exercise by any of the following: written
notice of revocation, execution and delivery of a later dated proxy to the
Secretary of the Trust (if returned and received in time to be voted), or
attendance and voting at the Meeting. Attendance at the Meeting will not in
and of itself revoke a proxy.
Shareholders of record as of the close of business on October 25, 1996,
the record date for the determination of Shareholders entitled to notice of
and to vote at the Meeting, are entitled to one vote for each share held and
a fractional vote for a fractional share. On October 25, 1996, there were
30,988,050 shares of beneficial interest outstanding, all with $.01 par
value. No person was known to own as much as 5% of the outstanding shares of
the Trust on that date. The Trustees and Officers of the Trust, together,
owned less than 1% of the Trust's outstanding shares on that date. The
percentage ownership of shares of the Trust changes from time to time
depending on purchases and sales by shareholders and the total number of
shares outstanding.
The cost of soliciting proxies for the Meeting, consisting principally of
printing and mailing expenses, will be borne by the Trust. The solicitation
of proxies will be by mail, which may be supplemented by solicitation by
mail, telephone or otherwise through Trustees, officers and regular employees
of the Trust, or Dean Witter InterCapital Inc. ("InterCapital" or the
"Investment Adviser"), and employees of broker-dealers, including Dean Witter
Reynolds, Inc. ("DWR"), without special compensation therefor. In addition,
the Trust may employ William F. Doring and Co. as proxy solicitor, the cost
of which is not expected to exceed $3,000 and will be borne by the Trust. The
first mailing of this proxy statement is expected to be made on or about
November 7, 1996.
(1) ELECTION OF TRUSTEES
The number of Trustees has currently been fixed by the Trustees, pursuant
to the Trust's Declaration of Trust, at eight. At the Meeting, two nominees
are to be elected to the Trust's Board of Trustees. There are currently eight
Trustees, two of whom (Manuel H. Johnson and John L. Schroeder) are standing
for election at this Meeting to serve until the 1999 Annual Meeting, in
accordance with the Trust's Declaration of Trust, as amended.
Six of the current eight Trustees (Michael Bozic, Edwin J. Garn, John R.
Haire, Manuel H. Johnson, Michael E. Nugent and John L. Schroeder) are
"Independent Trustees," that is, Trustees who are not
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<PAGE>
"interested persons" of the Trust, as that term is defined in the Investment
Company Act of 1940, as amended (the "Act"). The nominees for election as
Trustees have been proposed by the Trustees now serving or, in the case of
the nominees for positions as Independent Trustees, by the Independent
Trustees now serving. All of the Trustees have been elected by the
Shareholders of the Trust.
The nominees of the Board of Trustees for election as Trustees are listed
below. It is the intention of the persons named in the enclosed form of proxy
to vote the shares represented by them for the election of the following
nominees: Manuel H. Johnson and John L. Schroeder. Should any of the nominees
become unable or unwilling to accept nomination or election, the persons
named in the proxy will exercise their voting power in favor of such person
or persons as the Board may recommend. All of the nominees have consented to
being named in this proxy statement and to serve if elected. The Trust knows
no reason why any of said nominees would be unable or unwilling to accept
nomination or election. Trustees will be elected by a plurality of the votes
cast at the Meeting.
Pursuant to the provisions of the Declaration of Trust (Section 2.2, as
amended), the nominees for election as Trustees are divided into three
separate classes, each class having a term of three years. The term of office
of one of the three classes will expire each year.
The Board has determined that the nominees for election as Trustee shall
be standing for election as Trustee in each of the three classes of Trustee
as follows: Class I--Messrs. Bozic and Fiumefreddo; Class II--Messrs. Johnson
and Schroeder; and Class III--Messrs. Garn, Haire, Nugent and Purcell. Each
Nominee will, if elected, serve a term of up to approximately three years
running for the period assigned to that class and terminating at the date of
the Annual Meeting of Shareholders so designated by the Board of Trustees, or
any adjournment thereof. As a consequence of this method of election, the
replacement of a majority of the Board of Trustees could be delayed for up to
two years. In accordance with the above, the Trustees in Class II are
standing for election at this Meeting and, if elected, will serve until the
1999 Annual Meeting, or until their successors shall have been elected and
qualified.
The following information regarding each of the nominees for election as
Trustee, and each of the other members of the Board, includes his principal
occupations and employment for at least the last five years, his age, shares
of the Trust owned, if any, as of October 25, 1996 (shown in parentheses),
positions with the Trust, and directorships or trusteeships in other
companies which file periodic reports with the Securities and Exchange
Commission, including the 82 investment companies, including the Trust, for
which InterCapital serves as investment manager or investment adviser
(referred to herein collectively as the "Dean Witter Funds"), and the 14
investment companies for which InterCapital's wholly-owned subsidiary, Dean
Witter Services Company Inc. ("DWSC"), serves as manager and TCW Funds
Management, Inc., serves as investment adviser (referred to herein as the
TCW/DW Funds").
The nominees for Trustee to be elected at this Meeting are:
DR. MANUEL H. JOHNSON, Trustee since July, 1991; age 47; Senior Partner,
Johnson Smick International, Inc., a consulting firm; Koch Professor of
International Economics and Director of the Center for Global Market Studies
at George Mason University Co-Chairman and a founder of the Group of Seven
Council (G7C), an international economic commission; Director or Trustee of
the Dean Witter Funds; Trustee of the TCW/DW Funds; Director of NASDAQ (since
June, 1995); Director of Greenwich Capital Markets Inc. (broker-dealer);
formerly Vice Chairman of the Board of Governors of the Federal Reserve
System (1986-1990) and Assistant Secretary of the U.S. Treasury (1982-1986).
JOHN L. SCHROEDER, Trustee since April, 1994; age 66; Retired; Director or
Trustee of the Dean Witter Funds; Trustee of the TCW/DW Funds; Director of
Citizens Utilities Company; formerly Executive Vice
3
<PAGE>
President and Chief Investment Officer of The Home Insurance Company (August,
1991-September, 1995) and Chairman and Chief Investment Officer of
Axe-Houghton Management and the Axe-Houghton Funds (April, 1983-June, 1991).
The Trustees who are not standing for reelection at this Meeting are:
MICHAEL BOZIC, Trustee since April, 1994; age 55; Chairman and Chief
Executive Officer of Levitz Furniture Corporation (since November, 1995);
Director or Trustee of the Dean Witter Funds; formerly President and Chief
Executive Officer of Hills Department Stores (May, 1991-July, 1995); formerly
variously Chairman, Chief Executive Officer, President and Chief Operating
Officer (1987-1991) of the Sears Merchandise Group of Sears, Roebuck and Co.;
Director of Eaglemark Financial Services, Inc., the United Negro College Fund
and Weirton Steel Corporation.
<F1>
CHARLES A. FIUMEFREDDO,* Trustee since July, 1991; age 63; Chairman, Chief
Executive Officer and Director of InterCapital, Dean Witter Services Company
Inc. ("DWSC") and Dean Witter Distributors Inc. ("Distributors"); Executive
Vice President and Director of Dean Witter Reynolds Inc. ("DWR"); Chairman,
Director or Trustee, President and Chief Executive Officer of the Dean Witter
Funds; Chairman, Chief Executive Officer and Trustee of the TCW/DW Funds;
Chairman and Director of Dean Witter Trust Company ("DWTC"); Director and/or
officer of various Dean Witter, Discover & Co. ("DWDC") subsidiaries;
formerly Executive Vice President and Director of DWDC (until February,
1993).
EDWIN JACOB (JAKE) GARN, Trustee since January, 1993; age 64; Director or
Trustee of the Dean Witter Funds; formerly United States Senator (R-Utah)
(1974-1992) and Chairman, Senate Banking Committee (1980-1986); formerly
Mayor of Salt Lake City, Utah (1971-1974); formerly Astronaut, Space Shuttle
Discovery (April 12-19, 1985); Vice Chairman, Huntsman Chemical Corporation
(since January, 1993); Director of Franklin Quest (time management systems)
and John Alden Financial Corp.; Member of the board of various civic and
charitable organizations.
JOHN R. HAIRE, Trustee since January, 1988; age 71; Chairman of the Audit
Committee and Chairman of the Committee of the Independent Directors or
Trustees and Director or Trustee of the Dean Witter Funds; Chairman of the
Audit Committee and Chairman of the Committee of the Independent Trustees and
Trustee of the TCW/DW Funds; formerly President, Council for Aid to Education
(1978-1989) and Chairman and Chief Executive Officer of Anchor Corporation,
an investment adviser (1964-1978); Director of Washington National
Corporation (insurance).
MICHAEL E. NUGENT, Trustee since July, 1991; age 60; General Partner,
Triumph Capital, L.P., a private investment partnership; Director or Trustee
of the Dean Witter Funds; Trustee of the TCW/DW Funds; formerly Vice
President, Bankers Trust Company and BT Capital Corporation (1984-1988);
Director of various business organizations.
<F2>
PHILIP J. PURCELL, * Trustee since April, 1994; (4,060 shares); age 53;
Chairman of the Board of Directors and Chief Executive Officer of DWDC, DWR
and Novus Credit Services Inc.; Director of InterCapital, DWSC and
Distributors; Director or Trustee of the Dean Witter Funds; Director and/or
officer of various DWDC Subsidiaries.
- ------------
* Messrs. Fiumefreddo and Purcell may be deemed "interested persons," of the
Trust and its Investment Adviser as defined in Section 2(a)(19) of the Act,
due to their affiliation with the Investment Adviser and/or its affiliated
companies.
4
<PAGE>
The executive officers of the Trust are: Sheldon Curtis, Vice President,
Secretary and General Counsel; Robert M. Scanlan, Vice President; Robert S.
Giambrone, Vice President; Joseph J. McAlinden, Vice President; James F.
Willison, Vice President; and Thomas F. Caloia, Treasurer. In addition,
Joseph Arcieri, Gerard J. Lian and Katherine H. Stromberg are Vice Presidents
of the Trust and Marilyn K. Cranney, Barry Fink, Lou Anne D. McInnis, Ruth
Rossi and Carsten Otto serve as Assistant Secretaries. Mr. Curtis is 64 years
old and is currently Senior Vice President, Secretary and General Counsel of
InterCapital and DWSC and Assistant Secretary of DWR; he is also Senior Vice
President, Assistant Secretary and Assistant General Counsel of Distributors
and Senior Vice President and Secretary of DWTC. Mr. Scanlan is 60 years old
and is currently President and Chief Operating Officer of InterCapital (since
March, 1993) and DWSC; he is also Executive Vice President of Distributors
and Executive Vice President and Director of DWTC. He was previously
Executive Vice President of InterCapital (July, 1992-March, 1993) and prior
thereto was Chairman of Harborview Group Inc. Mr. Giambrone is 42 years old
and is currently Senior Vice President of InterCapital, DWSC, Distributors
and DWTC (since August, 1995) and Director of DWTC (since April, 1996). He
was formerly a partner of KPMG Peat Marwick, LLP. Mr. McAlinden is 53 years
old and is currently Executive Vice President of InterCapital (since April,
1995) and Chief Investment Officer of InterCapital and Director of DWTC
(since April, 1996). He was previously Senior Vice President of InterCapital
(June, 1995-April, 1996). He was formerly a Managing Director at Dillon Read.
Mr. Caloia is 50 years old and is currently First Vice President and
Assistant Treasurer of InterCapital and DWSC. Mr. Willison is 53 years old
and is currently Senior Vice President of InterCapital. Mr. Arcieri is 48
years old and is currently Vice President of InterCapital. Mr. Lian is 41
years old and is currently Vice President of InterCapital. He was formerly a
Senior Municipal Analyst with the American Express Company (1984-1992). Ms.
Stromberg is 48 years old and is currently Vice President of InterCapital
(since April, 1992). She was formerly a portfolio manager with InterCapital
(October, 1991-April, 1992) and Vice President of Kidder Peabody Asset
Management (October, 1985-October, 1991). Other than Mr. Scanlan, Mr.
Giambrone, Mr. McAlinden, Mr. Lian and Ms. Stromberg, each of the above
officers has been an employee of InterCapital or DWR (formerly the corporate
parent of InterCapital) for over five years.
THE BOARD OF TRUSTEES, THE INDEPENDENT TRUSTEES, AND THE COMMITTEES
The Board of Trustees consists of eight (8) trustees. These same
individuals also serve as directors or trustees for all of the Dean Witter
Funds, and are referred to in this section as Trustees. As of the date of
this Proxy Statement, there are a total of 82 Dean Witter Funds, comprised of
122 portfolios. As of September 30, 1996, the Dean Witter Funds had total net
assets of approximately $78 billion and more than five million shareholders.
Six Trustees (75% of the total number) have no affiliation or business
connection with InterCapital or any of its affiliated persons and do not own
any stock or other securities issued by InterCapital's parent company, DWDC.
These are the "disinterested" or "independent" Trustees. The other two
Trustees (the "management Trustees") are affiliated with InterCapital. Four
of the six independent Trustees are also Independent Trustees of the TCW/DW
Funds.
Law and regulation establish both general guidelines and specific duties
for the Independent Trustees. The Dean Witter Funds seek as Independent
Trustees individuals of distinction and experience in business and finance,
government service or academia; these are people whose advice and counsel are
in demand by others and for whom there is often competition. To accept a
position on the Funds' Boards, such individuals may reject other attractive
assignments because the Funds make substantial demands on their time. Indeed,
by serving on the Funds' Boards, certain Trustees who would otherwise be
qualified and in demand to serve on bank boards would be prohibited by law
from doing so.
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<PAGE>
All of the Independent Trustees serve as members of the Audit Committee
and the Committee of the Independent Trustees. Three of them also serve as
members of the Derivatives Committee. The Committees hold some meetings at
InterCapital's offices and some outside InterCapital. Management Trustees or
officers do not attend these meetings unless they are invited for purposes of
furnishing information or making a report. There are no nominating or
compensation committees of the Trustees.
The Committee of the Independent Trustees is charged with recommending to
the full Board approval of management, advisory and administration contracts,
Rule 12b-1 plans and distribution and underwriting agreements; continually
reviewing Fund performance; checking on the pricing of portfolio securities,
brokerage commissions, transfer agent costs and performance, and trading
among Funds in the same complex; and approving fidelity bond and related
insurance coverage and allocations, as well as other matters that arise from
time to time. The Independent Trustees are required to select and nominate
individuals to fill any Independent Trustee vacancy on the Board of any Fund
that has a Rule 12b-1 plan of distribution. Most of the Dean Witter Funds
have such a plan.
The Audit Committee is charged with recommending to the full Board the
engagement or discharge of the Fund's independent accountants; directing
investigations into matters within the scope of the independent accountants'
duties, including the power to retain outside specialists; reviewing with the
independent accountants the audit plan and results of the auditing
engagement; approving professional services provided by the independent
accountants and other accounting firms prior to the performance of such
services; reviewing the independence of the independent accountants;
considering the range of audit and non-audit fees; reviewing the adequacy of
the Fund's system of internal controls; and preparing and submitting
Committee meeting minutes to the full Board.
Finally, the Board of each Fund has formed a Derivatives Committee to
establish parameters for and oversee the activities of the Fund with respect
to derivative investments, if any, made by the Fund.
For the fiscal year ended August 31, 1996, the Board of Trustees of the
Trust held four meetings, and the Audit Committee, the Committee of the
Independent Trustees and the Derivatives Committee of the Trust held one, ten
and three meetings, respectively. No Trustee attended fewer than 75% of the
meetings of the Board of Trustees, the Audit Committee, the Committee of the
Independent Trustees or the Derivatives Committee held while he served in
such positions.
DUTIES OF CHAIRMAN OF COMMITTEE OF THE INDEPENDENT TRUSTEES AND AUDIT
COMMITTEE
The Chairman of the Committee of the Independent Trustees and the Audit
Committee maintains an office at the Funds' headquarters in New York. He is
responsible for keeping abreast of regulatory and industry developments and
the Funds' operations and management. He screens and/or prepares written
materials and identifies critical issues for the Independent Trustees to
consider, develops agendas for Committee meetings, determines the type and
amount of information that the Committees will need to form a judgment on
various issues, and arranges to have that information furnished to Committee
members. He also arranges for the services of independent experts and
consults with them in advance of meetings to help refine reports and to focus
on critical issues. Members of the Committees believe that the person who
serves as Chairman of both Committees and guides their efforts is pivotal to
the effective functioning of the Committees.
The Chairman of the Committees also maintains continuous contact with the
Funds' management, with independent counsel to the Independent Trustees and
with the Funds' independent auditors. He arranges for a series of special
meetings involving the annual review of investment advisory, management and
other operating contracts of the Funds and, on behalf of the Committees,
conducts negotiations with the Investment Adviser and other service
providers. In effect, the Chairman of the Committees serves as a combination
of chief executive and support staff of the Independent Trustees.
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<PAGE>
The Chairman of the Committee of the Independent Trustees and the Audit
Committee is not employed by any other organization and devotes his time
primarily to the services he performs as Committee Chairman and Independent
Trustee of the Dean Witter Funds and as an Independent Trustee and, since
July 1, 1996, as Chairman of the Committee of the Independent Trustees and
the Audit Committee of the TCW/DW Funds. The current Committee Chairman has
had more than 35 years experience as a senior executive in the investment
company industry.
ADVANTAGES OF HAVING SAME INDIVIDUALS AS INDEPENDENT TRUSTEES FOR ALL DEAN
WITTER FUNDS
The Independent Trustees and the Funds' management believe that having the
same Independent Trustees for each of the Dean Witter Funds avoids the
duplication of effort that would arise from having different groups of
individuals serving as Independent Trustees for each of the Funds or even of
sub-groups of Funds. They believe that having the same individuals serve as
Independent Trustees of all the Funds tends to increase their knowledge and
expertise regarding matters which affect the Fund complex generally and
enhances their ability to negotiate on behalf of each Fund with the Fund's
service providers. This arrangement also precludes the possibility of
separate groups of Independent Trustees arriving at conflicting decisions
regarding operations and management of the Funds and avoids the cost and
confusion that would likely ensue. Finally, having the same Independent
Trustees serve on all Fund Boards enhances the ability of each Fund to
obtain, at modest cost to each separate Fund, the services of Independent
Trustees, and a Chairman of their Committees, of the caliber, experience and
business acumen of the individuals who serve as Independent Trustees of the
Dean Witter Funds.
SHARE OWNERSHIP BY TRUSTEES
The Trustees have adopted a policy pursuant to which each Trustee and/or
his or her spouse is required to invest at least $25,000 in any of the Funds
in the Dean Witter Funds complex (and, if applicable, in the TCW/DW Funds
complex) on whose boards the Trustee serves. In addition, the policy
contemplates that the Trustees will, over time, increase their aggregate
investment in the Funds above the $25,000 minimum requirement. The Trustees
may allocate their investments among specific Funds in any manner they
determine is appropriate based on their individual investment objectives. As
of the date of this proxy statement, each Trustee is in compliance with the
policy. Any future Trustee will be given a one year period following his or
her election within which to comply with the foregoing. As of September 30,
1996, the total value of the investments by the Trustees and/or their spouses
in shares of the Dean Witter Funds (and, if applicable, the TCW/DW Funds) was
approximately $8.5 million.
As of October 25, 1996, the aggregate number of shares of beneficial
interest of the Trust owned by the Trust's officers and Trustees as a group
was less than 1 percent of the Trust's shares of beneficial interest
outstanding.
COMPENSATION OF INDEPENDENT TRUSTEES
The Trust pays each Independent Trustee an annual fee of $1,000 plus a per
meeting fee of $50 for meetings of the Board of Trustees or committees of the
Board of Trustees attended by the Trustee (the Trust pays the Chairman of the
Audit Committee an annual fee of $750 and pays the Chairman of the Committee
of the Independent Trustees an additional annual fee of $1,200). The Trust
also reimburses such Trustees for travel and other out-of-pocket expenses
incurred by them in connection with attending such meetings. Trustees and
officers of the Trust who are or have been employed by the Investment Adviser
or an affiliated company receive no compensation or expense reimbursement
from the Trust.
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<PAGE>
The following table illustrates the compensation paid to the Trust's
Independent Trustees by the Trust for the fiscal year ended August 31, 1996.
TRUST COMPENSATION
<TABLE>
<CAPTION>
AGGREGATE
COMPENSATION
NAME OF INDEPENDENT TRUSTEE FROM THE TRUST
- --------------------------- --------------
<S> <C>
Michael Bozic .............. 1,750
Edwin J. Garn .............. 1,800
John R. Haire .............. 3,913
Dr. Manuel H. Johnson ..... 1,750
Michael E. Nugent .......... 1,750
John L. Schroeder .......... 1,750
</TABLE>
The following table illustrates the compensation paid to the Trust's
Independent Trustees for the calendar year ended December 31, 1995 for
services to the 79 Dean Witter Funds and, in the case of Messrs. Haire,
Johnson, Nugent and Schroeder, the 11 TCW/DW Funds that were in operation at
December 31, 1995. With respect to Messrs. Haire, Johnson, Nugent and
Schroeder, the TCW/DW Funds are included solely because of a limited exchange
privilege between those Funds and five Dean Witter Money Market Funds. Mr.
Schroeder was elected as a Trustee of the TCW/DW Funds on April 20, 1995.
COMPENSATION FROM DEAN WITTER FUNDS AND TCW/DW FUNDS
<TABLE>
<CAPTION>
FOR SERVICE AS TOTAL
FOR SERVICE AS CHAIRMAN OF COMPENSATION
DIRECTOR OR FOR SERVICE AS COMMITTEE OF PAID FOR
TRUSTEE AND TRUSTEE AND INDEPENDENT SERVICES TO 79
COMMITTEE MEMBER COMMITTEE MEMBER DIRECTORS/ DEAN WITTER
OF 79 DEAN WITTER OF 11 TCW/DW TRUSTEES AND FUNDS AND 11
NAME OF INDEPENDENT TRUSTEE FUNDS FUNDS AUDIT COMMITTEE TCW/DW FUNDS
- --------------------------- ----------------- ---------------- --------------- ---------------
<S> <C> <C> <C> <C>
Michael Bozic .............. $126,050 -- -- $126,050
Edwin J. Garn .............. 136,450 -- -- 136,450
John R. Haire .............. 98,450 $82,038 $217,350(1) 397,838
Dr. Manuel H. Johnson ..... 136,450 82,038 -- 218,488
Michael E. Nugent .......... 124,200 75,038 -- 199,238
John L. Schroeder .......... 136,450 46,964 -- 183,414
</TABLE>
- ------------
(1) For the 79 Dean Witter Funds in operation at December 31, 1995. As
noted above, on July 1, 1996, Mr. Haire became Chairman of the
Committee of the Independent Trustees and the Audit Committee of the
TCW/DW Funds in addition to continuing to serve in such positions for
the Dean Witter Funds.
As of the date of this Proxy Statement, 57 of the Dean Witter Funds,
including the Trust, have adopted a retirement program under which an
Independent Trustee who retires after serving for at least five years (or
such lesser period as may be determined by the Board) as an Independent
Director or Trustee of any Dean Witter Fund that has adopted the retirement
program (each such Fund referred to as an "Adopting Fund" and each such
Trustee referred to as an "Eligible Trustee") is entitled to retirement
payments upon reaching the eligible retirement age (normally, after attaining
age 72). Annual payments are based upon length of service. Currently, upon
retirement, each Eligible Trustee is entitled to receive from the Adopting
Fund, commencing as of his or her retirement date and continuing for the
remainder of his or her life, an annual retirement benefit (the "Regular
Benefit") equal to 25.0% of his or her Eligible Compensation plus 0.4166666%
of such Eligible
8
<PAGE>
Compensation for each full month of service as an Independent Director or
Trustee of any Adopting Fund in excess of five years up to a maximum of 50.0%
after ten years of service. The foregoing percentages may be changed by the
Board.(2) "Eligible Compensation" is one-fifth of the total compensation
earned by such Eligible Trustee for service to the Adopting Fund in the five
year period prior to the date of the Eligible Trustee's retirement. Benefits
under the retirement program are not secured or funded by the Adopting Funds.
The following table illustrates the retirement benefits accrued to the
Trust's Independent Trustees by the Trust for the fiscal year ended August
31, 1996 and by the 57 Dean Witter Funds (including the Trust) as of December
31, 1995, and the estimated retirement benefits for the Trust's Independent
Trustees from the Trust as of August 31, 1996 and from the 57 Dean Witter
Funds as of December 31, 1995.
RETIREMENT BENEFITS FROM THE TRUST AND ALL DEAN WITTER FUNDS
<TABLE>
<CAPTION>
FOR ALL FUNDS RETIREMENT ESTIMATED ANNUAL
------------------------------- BENEFITS BENEFITS UPON
ESTIMATED ACCRUED AS RETIREMENT(3)
CREDITED YEARS ESTIMATED EXPENSES -----------------------
OF SERVICE AT PERCENTAGE OF ---------------------------- FROM
RETIREMENT ELIGIBLE BY ALL THE FROM ALL
NAME OF INDEPENDENT TRUSTEE (MAXIMUM 10) COMPENSATION BY THE TRUST ADOPTING FUNDS TRUST ADOPTING FUNDS
- --------------------------- -------------- --------------- ------------ -------------- ------- --------------
<S> <C> <C> <C> <C> <C> <C>
Michael Bozic ............. 10 50.0% 377 $ 26,359 850 $ 51,550
Edwin J. Garn ............. 10 50.0 548 41,901 850 51,550
John R. Haire ............. 10 50.0 961 261,763 2,296 130,404
Dr. Manuel H. Johnson .... 10 50.0 229 16,748 850 51,550
Michael E. Nugent ......... 10 50.0 391 30,370 850 51,550
John L. Schroeder ......... 8 41.7 728 51,812 708 42,958
</TABLE>
- ------------
(2) An Eligible Trustee may elect alternate payments of his or her
retirement benefits based upon the combined life expectancy of such
Eligible Trustee and his or her spouse on the date of such Eligible
Trustee's retirement. The amount estimated to be payable under this
method, through the remainder of the later of the lives of such
Eligible Trustee and spouse, will be the actuarial equivalent of the
Regular Benefit. In addition, the Eligible Trustee may elect that the
surviving spouse's periodic payment of benefits will be equal to either
50% or 100% of the previous periodic amount, an election that,
respectively, increases or decreases the previous periodic amount so
that the resulting payments will be the actuarial equivalent of the
Regular Benefit.
(3) Based on current levels of compensation. Amount of annual benefits also
varies depending on the Trustee's elections described in Footnote (2)
above.
(2) APPROVAL OR DISAPPROVAL OF CURRENTLY EFFECTIVE
INVESTMENT ADVISORY AGREEMENT
The Trust's investments are managed by Dean Witter InterCapital Inc.
(referred to herein as the "Investment Adviser" or "InterCapital"), pursuant
to an Investment Advisory Agreement dated June 30, 1993 (referred to herein
as the "Advisory Agreement") which took effect upon the distribution by
Sears, Roebuck and Co. ("Sears") to its shareholders of all the common shares
of DWDC (the parent company of InterCapital and DWR) then owned by Sears. The
Advisory Agreement was approved by the Board of Trustees on October 30, 1992
and by the Shareholders of the Trust at a Special Meeting of Shareholders
held on February 25, 1993. The present Advisory Agreement supersedes an
earlier advisory agreement also approved by Shareholders on February 25, 1993
in connection with the assumption by InterCapital of the investment advisory
activities previously performed by another investment adviser and which took
effect on March 1, 1993. The terms of the Advisory Agreement are described
below. The Advisory Agreement was last approved by the shareholders of the
Trust as a routine matter at their Annual Meeting held on December 20, 1995.
The Advisory Agreement's
9
<PAGE>
most recent continuation until April 30, 1997 was approved by the Trustees,
including a majority of the Independent Trustees, at a meeting of the Board
held on April 17, 1996. The Advisory Agreement is now being submitted to
shareholders for their approval at the forthcoming meeting. In the event
shareholders do not approve continuance of the Advisory Agreement by the
required majority vote at the forthcoming meeting or any adjournment thereof,
the Board of Trustees of the Trust will take such action as it deems to be in
the best interest of the Trust and its shareholders, which may include
calling a special meeting of shareholders to vote on a new investment
advisory agreement.
In considering whether or not to approve the Advisory Agreement, the Board
of Trustees reviewed the terms of the agreement and considered all materials
and information deemed relevant to its determination. Among other things, the
Board considered the nature and scope of services to be rendered, the quality
of the Adviser's services and personnel, and the appropriateness of the fees
that are paid under the Advisory Agreement, taking into account other fees
paid to affiliates of the Investment Adviser, pursuant to Administration and
Transfer Agency Agreements (see below). Based upon its review, the Board of
Trustees, including all of the Independent Trustees, determined that the
approval of the Advisory Agreement was in the best interests of the Trust and
its shareholders.
The favorable vote of a majority of the outstanding voting securities of
the Trust is required for the approval of the Advisory Agreement. Such a
majority is defined in the Act as the lesser of: (a) 67% or more of the
shares present at the Meeting, if the holders of more than 50% of the
outstanding shares of the Trust are present or represented by proxy, or (b)
more than 50% of the outstanding shares.
THE BOARD OF TRUSTEES, INCLUDING ALL OF THE INDEPENDENT TRUSTEES,
UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS APPROVE THE ADVISORY AGREEMENT.
THE ADVISORY AGREEMENT
The Advisory Agreement provides that the Investment Adviser shall
continuously manage the assets of the Trust in a manner consistent with the
Trust's investment objectives. The Investment Adviser obtains and evaluates
such information and advice relating to the economy, securities markets and
specific securities as it considers necessary or useful to continuously
manage the assets of the Trust in a manner consistent with its investment
objectives and policies. In addition, the Investment Adviser pays the
compensation of all personnel, including officers of the Trust, who are its
employees. The Investment Adviser has authority to place orders for the
purchase and sale of portfolio securities on behalf of the Trust without
prior approval of its Trustees. The Trustees review the investment portfolio
at their regular meetings.
In return for its investment services and the expenses which the
Investment Adviser assumes under the Advisory Agreement, the Trust pays the
Investment Adviser compensation which is computed weekly and payable monthly
and which is determined by applying the annual rate of 0.35% to the Trust's
average weekly net assets not exceeding $250 million and 0.25% of the portion
of average weekly net assets exceeding $250 million. Pursuant to the Advisory
Agreement, the Trust accrued to the Investment Adviser total compensation of
$1,028,369 during the fiscal year ended August 31, 1996. The net assets of
the Trust totalled $301,834,812 at August 31, 1996.
Under the Advisory Agreement, the Trust is obligated to bear all of the
costs and expenses of its operation, except those specifically assumed by the
Investment Adviser, including, without limitation: charges and expenses of
any registrar, custodian or depository appointed by the Trust for the
safekeeping of its cash, portfolio securities or commodities and other
property, and any stock transfer or dividend agent or agents appointed by the
Trust; brokers' commissions chargeable to the Trust in connection with
portfolio securities transactions to which the Trust is a party; all taxes,
including securities or commodities issuance and transfer taxes, and fees
payable by the Trust to Federal, state or other governmental agencies; costs
and expenses of
10
<PAGE>
engraving or printing of certificates representing shares of the Trust; all
costs and expenses in connection with registration and maintenance of
registration of the Trust and of its shares with the Securities and Exchange
Commission and various states and other jurisdictions (including filing fees
and legal fees and disbursements of counsel); the costs and expense of
preparing, printing, including typesetting, and distributing prospectuses for
such purposes; all expenses of shareholders' and Trustees' meetings and of
preparing, printing and mailing proxy statements and reports to shareholders;
fees and travel expenses of Trustees or members of any advisory board or
committee who are not employees of the Trust's Administrator or Investment
Adviser or any of their corporate affiliates; all expenses incident to the
payment of any dividend or distribution program; charges and expenses of any
outside pricing services; charges and expenses of legal counsel, including
counsel to the Independent Trustees of the Trust, and independent accountants
in connection with any matter relating to the Trust (not including
compensation or expenses of attorneys employed by the Trust's Administrator
or Investment Adviser); membership dues of industry associations; interest
payable on Trust borrowings; fees and expenses incident to the listing of the
Trust's shares on any stock exchange; postage; insurance premiums on property
or personnel (including officers and Trustees) of the Trust which inure to
its benefit; extraordinary expenses (including, but not limited to, legal
claims, liabilities, litigation costs and any indemnification related
thereto); and all other charges and costs of the Trust's operations unless
otherwise explicitly provided in the Advisory Agreement.
The Advisory Agreement had an initial term ending April 30, 1994 and
provides that, after the initial period of effectiveness, it will continue in
effect from year to year thereafter provided such continuance is approved at
least annually by vote of a majority, as defined in the Act, of the
outstanding voting securities of the Trust or by the Trustees of the Trust,
and, in either event, by the vote cast in person by a majority of the
Trustees who are not parties to the Advisory Agreement or "interested
persons" of any such party (as defined in the Act) at a meeting called for
the purpose of voting on such approval. The Advisory Agreement's most recent
continuation until April 30, 1997 was approved by the Trustees, including a
majority of the Independent Trustees, at a Meeting of the Trustees held on
April 17, 1996, called for the purpose of approving the Advisory Agreement.
The Advisory Agreement also provides that it may be terminated at any time
by the Investment Adviser, the Trustees of the Trust or by a vote of a
majority of the outstanding voting securities of the Trust, in each instance
without the payment of any penalty, on thirty days' notice and will
automatically terminate upon any assignment.
INVESTMENT ADVISER
Dean Witter InterCapital Inc. is the Trust's investment adviser.
InterCapital maintains its offices at Two World Trade Center, New York, New
York 10048. InterCapital, which was incorporated in July, 1992, is a
wholly-owned subsidiary of DWDC, a balanced financial services organization
providing a broad range of nationally marketed credit and investment
products. In an internal reorganization which took place in January, 1993,
InterCapital assumed the investment advisory, management and administrative
activities previously performed by the InterCapital Division of DWR.
InterCapital's wholly-owned subsidiary, DWSC, serves as the Administrator
of the Trust and receives from the Trust compensation which is computed
weekly and payable monthly and which is determined by applying the following
annual rates: 0.20% of the portion of average weekly net assets not exceeding
$250 million; 0.15% of the portion of average weekly net assets exceeding
$250 million and not exceeding $500 million; 0.12% of the portion of average
weekly net assets exceeding $500 million and not exceeding $750 million; and
0.10% of the portion of average weekly net assets exceeding $750 million to
the Trust's weekly net assets. Prior to December 31, 1993, InterCapital
served as Administrator of the Trust and received compensation at the same
annual rate. On April 17, 1995, DWSC was reorganized in the State of
Delaware, necessitating the entry into a new
11
<PAGE>
Administration Agreement by the Trust and DWSC on such date. For the fiscal
year ended August 31, 1996, the Trust accrued to DWSC, pursuant to the
Administration Agreement, total compensation of $591,884.
The Principal Executive Officer and Directors of InterCapital, and their
principal occupations, are:
Philip J. Purcell, Chairman of the Board of Directors and Chief Executive
Officer of DWDC and DWR and Director of InterCapital, DWSC and Distributors;
Richard M. DeMartini, President and Chief Operating Officer of Dean Witter
Capital, Executive Vice President of DWDC and Director of DWTC, DWSC, DWR,
Distributors and InterCapital; James F. Higgins, President and Chief
Operating Officer of Dean Witter Financial, Executive Vice President of DWDC
and Director of DWTC, DWSC, DWR, Distributors and InterCapital; Charles A.
Fiumefreddo, Executive Vice President and Director of DWR, Chairman of the
Board of Directors, Chief Executive Officer and Director of InterCapital,
DWSC and Distributors and Chairman of the Board of Directors and Director of
DWTC; Christine A. Edwards, Executive Vice President, Secretary and General
Counsel of DWDC, Executive Vice President, Secretary, General Counsel and
Director of DWR, Executive Vice President, Secretary, Chief Legal Officer and
Director of Distributors and Director of InterCapital and DWSC; and Thomas C.
Schneider, Executive Vice President and Chief Financial Officer of DWDC and
Executive Vice President, Chief Financial Officer and Director of DWSC, DWR,
Distributors and InterCapital.
The business address of the foregoing Executive Officer and Directors is
Two World Trade Center, New York, New York 10048.
InterCapital and DWSC serve in various investment management, advisory,
management and administrative capacities to investment companies and pension
plans and other institutional and individual investors. The Appendix lists
the investment companies for which InterCapital provides investment
management or investment advisory services and which have similar investment
objectives to that of the Trust and sets forth the fees payable to
InterCapital by such companies, including the Trust, and their net assets as
of October 25, 1996.
DWDC has its offices at Two World Trade Center, New York, New York 10048.
There are various lawsuits pending against DWDC involving material amounts
which, in the opinion of its management, will be resolved with no material
effect on the consolidated financial position of the company.
During the fiscal year ended August 31, 1996, the Trust accrued to Dean
Witter Trust Company, the Trust's Transfer Agent and an affiliate of the
Investment Adviser, transfer agency fees of $161,329.
AFFILIATED BROKER
Because DWR and InterCapital are under the common control of DWDC, DWR is
an affiliated broker of InterCapital. For the fiscal year ended August 31,
1996, the Trust paid no brokerage commissions to DWR.
(3) RATIFICATION OR REJECTION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Trustees have unanimously selected the firm of Price Waterhouse LLP as
the Trust's independent accountants for the fiscal year ending August 31,
1997. Its selection is being submitted for ratification or rejection by
Shareholders at the Meeting. Price Waterhouse LLP has been the independent
accountants for the Trust since its inception, and has no direct or indirect
financial interest in the Trust.
A representative of Price Waterhouse LLP is expected to be present at the
Meeting and will be available to make a statement, and to respond to
appropriate questions of Shareholders.
The affirmative vote of the holders of a majority of the shares
represented and entitled to vote at the Annual Meeting is required for
ratification of the selection of Price Waterhouse LLP as the independent
accountants for the Trust.
12
<PAGE>
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT SHAREHOLDERS RATIFY THE SELECTION
OF PRICE WATERHOUSE LLP AS THE INDEPENDENT ACCOUNTANTS FOR THE TRUST.
(4) SHAREHOLDER PROPOSAL TO AMEND THE TRUST'S DECLARATION OF TRUST
TO REQUIRE EACH TRUSTEE, WITHIN THIRTY DAYS OF ELECTION,
TO BECOME A SHAREHOLDER OF THE TRUST
The Trust has been informed by Carol W. Mullett, 1420 Fern Court, Vero
Beach, Florida, 32963-4009, a shareholder of record who owned approximately
9,196 shares at October 25, 1996 (the "Proponent"), that she intends to
submit the following proposal (the "Shareholder Proposal") at the meeting:
RESOLVED, that the Declaration of Trust be amended to require that each
Trustee, within thirty days of election, become a shareholder of the
Trust.
The Proponent has requested that the following statement be included in
support of her proposal:
It seems obvious that the Trustees could best understand and represent
the interests of shareholders if they were shareholders themselves.
Shareholders seem to agree --last year a similar proposal was APPROVED by
a margin of over SIX TO ONE (11,902,553 in favor; 1,900,667 against). You
might ask how a proposal can win by such a huge margin and still lose?
Because it narrowly failed to obtain quorum. Ironically, the proposal
would have passed if a few more shareholders had voted against it.
According to the last proxy, eight of our ten Trustees DO NOT OWN A SINGLE
SHARE of our Trust. You will read below a litany of excuses and
explanations seeking to convince you that we are better off because our
Trustees are not shareholders. For amusement you may want to count the
number of times they urge you to vote AGAINST (always in capital letters)
my proposal: answer --five. Then you may want to ask yourselves why the
Trustees are so concerned that they may have to join us as shareholders. I
hope you will support this proposal and encourage the Trustees to become
shareholders.
THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS THAT YOU VOTE AGAINST THE
SHAREHOLDER PROPOSAL.
RECOMMENDATION OF THE BOARD OF TRUSTEES
As the Proponent's statement in support of her proposal indicates, she
requested that a similar proposal be included in the proxy statement relating
to last year's annual meeting. At that time the Trustees determined to oppose
the proposal and took the position that a share ownership requirement for
Trustees was not necessarily in the best interests of shareholders. For the
reasons stated below, the Trustees continue to adhere to this view. However,
to address any expectation of shareholders that the Trustees own shares of
Funds in the Dean Witter complex, the Trustees have adopted a share ownership
policy as described below.
The Share Ownership Policy
The Trustees are aware that there may be an expectation among shareholders
that the Trustees own shares of the Funds in the Dean Witter complex. To
address shareholder concerns in this regard, the Trustees, on July 23, 1996,
adopted a policy pursuant to which each Trustee, and/or his or her spouse, is
required to invest at least $25,000 in any of the Funds in the Dean Witter
complex (and, if applicable, in the TCW/DW Funds) on whose boards the Trustee
serves. In addition, the policy contemplates that the Trustees will, over
time, increase their aggregate investment in the Funds above the $25,000
minimum requirement. The Trustees may allocate their investments among
specific Funds in any manner they determine is appropriate based on their
individual investment objectives. Any future Trustee will be given a one year
period within which to comply with the foregoing policy. As of the date of
this proxy statement, each Trustee is in compliance with the policy. As of
September 30, 1996, the total value of shares of the Dean Witter Funds (and,
if applicable, the TCW/DW Funds) owned by the Trustees and/or their spouses
was approximately $8.5 million.
13
<PAGE>
Reasons for Opposing the Shareholder Proposal
As they stated in last year's proxy statement, the Trustees believe it is
not necessary to own shares of the Trust to act in the best interests of
shareholders and that they can carry out their duties and functions
diligently and effectively without owning shares of the Trust. In addition,
the Trust's objectives and policies may not be appropriate for a Trustee's
individual financial circumstances and the Trust could be inhibited in its
ability to attract Trustees if the available pool is limited to those whose
personal financial needs are met by the Trust's objectives and policies.
The Trustees continue to believe that any policy requiring the Trustees to
own shares of a specific Fund for which they serve as Trustees, without
regard to their own respective investment objectives, could logically be
extended to all the Funds in the Dean Witter complex. The Trustees believe
that such a complex-wide share ownership requirement would be impractical and
undesirable because it could make it more difficult to maintain the same
board of directors for all the Funds given the large number of Funds in the
complex. The Trustees believe that having the same Trustees for each of the
Dean Witter Funds is in the best interests of all the Funds' shareholders for
several reasons. First, a common board enhances the ability of each Fund to
obtain, at modest cost to each separate Fund, the services of high caliber
Trustees. In addition, having a common board avoids the duplication of effort
that would arise from having different groups of individuals serving as
Trustees for each of the Funds and avoids the cost and confusion that may
arise from different conclusions being reached by different boards on the
same operations and management issues. Finally, serving as Trustees of all
Funds tends to increase a Trustee's knowledge and expertise regarding matters
which affect all the Funds in the complex and enhances the ability to
negotiate on behalf of each Fund with the Funds' service providers.
For the reasons stated below and in light of the fact that they have
adopted the share ownership policy described above, the Trustees unanimously
recommend that shareholders vote AGAINST the Shareholder Proposal.
The affirmative vote of the holders of a majority of the shares
represented and entitled to vote at the Annual Meeting is required for the
approval of the Shareholder Proposal.
ADDITIONAL INFORMATION
In the event that the necessary quorum to transact business or the vote
required to approve or reject any proposal is not obtained at the Meeting,
the persons named as proxies may propose one or more adjournments of the
Meeting for a total of not more than 60 days in the aggregate to permit
further solicitation of proxies. Any such adjournment will require the
affirmative vote of the holders of a majority of the Trust's shares present
in person or by proxy at the Meeting. The persons named as proxies will vote
in favor of such adjournment those proxies which they are entitled to vote in
favor of Proposal Two and will vote against any such adjournment those
proxies required to be voted against that proposal.
Abstentions and, if applicable, broker "non-votes" will not count as votes
in favor of any of the proposals, and broker "non-votes" will not be deemed
to be present at the meeting for purposes of determining whether a particular
proposal to be voted upon has been approved. Broker "non-votes" are shares
held in street name for which the broker indicates that instructions have not
been received from the beneficial owners or other persons entitled to vote
and for which the broker does not have discretionary voting authority.
SHAREHOLDERS PROPOSALS
Proposals of security holders intended to be presented at the next Annual
Meeting of Shareholders must be received no later than July 11, 1997, for
inclusion in the proxy statement for that meeting. The mere
14
<PAGE>
submission of a proposal does not guarantee its inclusion in the proxy
materials or its presentation at the meeting. Certain rules under the federal
securities laws must be met.
REPORTS TO SHAREHOLDERS
The Trust's most recent Annual Report, for the fiscal year ended August
31, 1996, has previously been sent to Shareholders and is available without
charge upon request from Adrienne Ryan-Pinto at Dean Witter Trust Company,
Harborside Financial Center, Plaza Two, Jersey City, New Jersey 07311
(telephone 1-800-869-NEWS) (toll-free).
OTHER BUSINESS
The management knows of no other matters which may be presented at the
Meeting. However, if any matters not now known properly come before the
Meeting, it is the intention of the persons named in the enclosed form of
proxy, or their substitutes, to vote all shares that they are entitled to
vote on any such matter, utilizing such proxy in accordance with their best
judgment on such matters.
By Order of the Board of Trustees
SHELDON CURTIS
Secretary
15
<PAGE>
APPENDIX
InterCapital serves as investment manager or investment adviser to the
Trust and the other investment companies listed below which have similar
investment objectives to that of the Trust, with the net assets shown as of
October 25, 1996.
<TABLE>
<CAPTION>
NET ASSETS AS CURRENT INVESTMENT MANAGEMENT
OF 10/25/96 OR ADVISORY FEE RATE(S)
-------------- ------------------------------
<S> <C> <C>
1. DEAN WITTER CALIFORNIA TAX-FREE INCOME FUND* ... $ 979,297,269 0.55% on assets up to $500
million, scaled down at
various asset levels to 0.45%
on assets over $1.25 billion
2. DEAN WITTER LIMITED TERM MUNICIPAL TRUST* ...... $ 65,950,563 0.50%
3. DEAN WITTER MULTI-STATE MUNICIPAL SERIES TRUST* $ 399,852,660 0.35%(1)
4. DEAN WITTER NATIONAL MUNICIPAL TRUST* .......... $ 81,472,305 0.35%(2)
5. DEAN WITTER NEW YORK TAX-FREE INCOME FUND* ..... $ 194,640,017 0.55% on assets up to $500
million and 0.525% on assets
over $500 million
6. DEAN WITTER TAX-EXEMPT SECURITIES TRUST* ....... $1,195,610,352 0.50% on assets up to $500
million, scaled down at
various asset levels to 0.325%
on assets over $1.25 billion
7. INTERCAPITAL CALIFORNIA INSURED MUNICIPAL INCOME
TRUST** ......................................... $ 241,689,316 0.35%
8. INTERCAPITAL CALIFORNIA QUALITY MUNICIPAL
SECURITIES** .................................... $ 202,009,694 0.35%
9. INTERCAPITAL INSURED CALIFORNIA MUNICIPAL
SECURITIES** .................................... $ 63,108,057 0.35%
10. INTERCAPITAL INSURED MUNICIPAL BOND TRUST** ... $ 108,868,315 0.35%
11. INTERCAPITAL INSURED MUNICIPAL INCOME TRUST** . $ 585,347,861 0.35%
12. INTERCAPITAL INSURED MUNICIPAL SECURITIES** ... $ 136,917,384 0.35%
13. INTERCAPITAL INSURED MUNICIPAL TRUST** ........ $ 483,045,850 0.35%
14. INTERCAPITAL NEW YORK QUALITY MUNICIPAL
SECURITIES** ................................... $ 92,306,352 0.35%
15. INTERCAPITAL QUALITY MUNICIPAL INCOME TRUST** . $ 730,464,261 0.35%
16. INTERCAPITAL QUALITY MUNICIPAL INVESTMENT
TRUST** ........................................ $ 378,374,736 0.35%
17. INTERCAPITAL QUALITY MUNICIPAL SECURITIES** ... $ 360,446,952 0.35%
18. MUNICIPAL INCOME TRUST** ....................... $ 303,143,337 0.35% on assets up to $250
million and 0.25% on assets
over $250 million
19. MUNICIPAL INCOME TRUST II** .................... $ 277,437,445 0.40% on assets up to $250
million and 0.30% on assets
over $250 million
A-1
<PAGE>
NET ASSETS AS CURRENT INVESTMENT MANAGEMENT
OF 10/25/96 OR ADVISORY FEE RATE(S)
-------------- ------------------------------
20. MUNICIPAL INCOME TRUST III** ................... $ 62,211,118 0.40% on assets up to $250
million and 0.30% on assets
over $250 million
21. MUNICIPAL INCOME OPPORTUNITIES TRUST** ........ $ 176,522,022 0.50%
22. MUNICIPAL INCOME OPPORTUNITIES TRUST II** ..... $ 174,320,730 0.50%
23. MUNICIPAL INCOME OPPORTUNITIES TRUST III** .... $ 102,827,458 0.50%
24. MUNICIPAL PREMIUM INCOME TRUST** ............... $ 356,912,241 0.40%
25. DEAN WITTER SELECT MUNICIPAL REINVESTMENT
FUND*** ........................................ $ 91,711,574 0.50%
26. DEAN WITTER HAWAII MUNICIPAL TRUST* ............ $ 3,116,606 0.35%(3)
<FN>
- ------------
* Open-end investment company
** Closed-end investment company
*** Open-end investment company offered only to the holders of units of
certain unit investment trusts (UITs) in connection with the
reinvestment of UIT distributions
(1) InterCapital has undertaken, until December 31, 1996, to assume all
operating expenses (except for any 12b-1 and brokerage fees) of the
Massachusetts, Michigan, Minnesota, New York and Ohio Series of Dean
Witter Multi-State Municipal Series Trust and to waive the compensation
provided for in its investment management agreement with that company
in respect to the aforementioned Series to the extent that such
expenses and compensation on an annualized basis exceed 0.50% of the
average daily net assets of the pertinent Series.
(2) InterCapital has undertaken, until December 31, 1996, to assume all
operating expenses (except for any 12b-1 and brokerage fees) of Dean
Witter National Municipal Trust and to waive the compensation provided
for in its investment management agreement with that company to the
extent that such expenses and compensation on an annualized basis
exceed 0.50% of the average daily net assets of that company.
(3) InterCapital has undertaken, until December 31, 1996, to assume all
operating expenses (except for any 12b-1 and brokerage fees) of Dean
Witter Hawaii Municipal Trust and to waive the compensation provided
for in its investment management agreement with that company.
</TABLE>
A-2
<PAGE>
MUNICIPAL INCOME TRUST
ANNUAL MEETING OF SHAREHOLDERS--DECEMBER 27, 1996
PROXY
The undersigned hereby appoints SHELDON CURTIS, ROBERT M. SCANLAN, BARRY
FINK, or any of them, proxies, each with the power of substitution, to vote
on behalf of the undersigned at the Annual Meeting of Shareholders of
MUNICIPAL INCOME TRUST on December 27, 1996 at 2:00 P.M., New York City time,
and at any adjournment thereof, on the proposals set forth in the Notice of
Meeting dated November 7, 1996 as follows:
THIS PROXY IS SOLICITED BY THE TRUSTEES. IF NO SPECIFICATION IS MADE ON
THE REVERSE SIDE, THIS PROXY WILL BE VOTED FOR ALL NOMINEES FOR TRUSTEE AND
FOR PROPOSALS 2 AND 3 AND AGAINST PROPOSAL 4.
IMPORTANT: PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD IN THE
ENCLOSED ENVELOPE SO THAT YOUR VOTE ON ALL MATTERS MAY BE
COUNTED.
(Continued, and to be dated and signed on reverse side.)
<PAGE>
PLEASE MARK BOXES [X] OR [X] IN BLUE OR BLACK INK.
1. ELECTION OF TRUSTEES: [ ] FOR ALL NOMINEES [ ] WITHHOLD AUTHORITY
(except as marked to (to vote for all
the contrary below) nominees listed
below)
Manuel H. Johnson, John L. Schroeder
(INSTRUCTION: To withhold authority to vote for any individual nominee write
that nominee's name on the space provided below.)
- -----------------------------------------------------------------------------
2. APPROVAL OF INVESTMENT ADVISORY AGREEMENT 3. RATIFICATION OF APPOINTMENT
OF PRICE WATERHOUSE LLP AS
INDEPENDENT ACCOUNTANTS:
FOR [ ] AGAINST [ ] ABSTAIN [ ] FOR [ ] AGAINST [ ] ABSTAIN [ ]
4. SHAREHOLDER PROPOSAL: FOR [ ] AGAINST [ ] ABSTAIN [ ]
(NOTE: THE TRUSTEES RECOMMEND A VOTE AGAINST THIS PROPOSAL)
121
and in their discretion in the transaction of any other business which may
properly come before the meeting.
Please sign personally. If the
shares are registered in more
than one name, each joint owner
or each fiduciary should sign
personally. Only authorized
officers should sign for
corporations.
Dated __________________________
--------------------------------
Signature
--------------------------------
Signature
