UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly report pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
For the Period ended September 30, 1997 or
[ ] Transition report pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
For the transition period from to
Commission File No. 33-25041
DEAN WITTER PRINCIPAL PLUS FUND L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3541588
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification
No.)
c/o Demeter Management Corp.
Two World Trade Center, New York, NY 62 Fl. 10048
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 392-5454
(Former name, former address, and former fiscal year, if changed
since last report)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
<PAGE>
<TABLE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
INDEX TO QUARTERLY REPORT ON FORM 10-Q
September 30, 1997
<CAPTION>
PART I. FINANCIAL INFORMATION
<S> <C>
Item 1. Consolidated Financial Statements
Consolidated Statements of Financial Condition
September 30, 1997 (Unaudited) and December 31, 1996.....2
Consolidated Statements of Operations for the
Quarters Ended September 30, 1997 and 1996 (Unaudited)...3
Consolidated Statements of Operations for the Nine
Months Ended September 30, 1997 and 1996 (Unaudited).....4
Consolidated Statements of Changes in Partners'
Capital for the Nine Months Ended September 30, 1997
and 1996 (Unaudited).....................................5
Consolidated Statements of Cash Flows for the
Nine Months Ended September 30, 1997 and 1996
(Unaudited)..............................................6
Notes to Consolidated Financial Statements
(Unaudited)...........................................7-12
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of
Operations........................................13-19
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.................................20-21
Item 5. Other Information....................................21
Item 6. Exhibits and Reports on Form 8-K.....................22
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
<CAPTION>
September 30, December 31,
1997 1996
$ $
(Unaudited)
ASSETS
<S> <C> <C>
Equity in Commodity futures trading accounts:
Cash 9,586,741 6,625,325
Net unrealized gain on open contracts 890,649 197,384
Net option premiums (724,000) -
Total Trading Equity 9,753,390 6,822,709
Investment in zero-coupon U.S. Treasury
Securities 45,076,888 47,247,655
Interest receivable (DWR) 36,741 26,628
Total Assets 54,867,019 54,096,992
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Redemptions payable 1,546,448 1,657,380
Accrued administrative fees 210,067 203,250
Accrued brokerage fees (DWR) 185,724 186,774
Accrued management fees 46,431 46,693
Accrued transaction fees and costs 3,028 4,108
Total Liabilities 1,991,698 2,098,205
Minority Interest 251,499 149,974
Partners' Capital
Limited Partners (30,646.656 and
34,253.485 Units, respectively) 51,311,431 50,688,703
General Partner (783 Units) 1,312,391 1,160,110
Total Partners' Capital 52,623,822 51,848,813
Total Liabilities and Partners' Capital 54,867,019 54,096,992
NET ASSET VALUE PER UNIT 1,674.34 1,479.85
<FN>
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
For the Quarters Ended September 30,
1997 1996
$ $
REVENUES
<S> <C> <C>
Trading profit (loss):
Realized 3,667,459 (313,932)
Net change in unrealized (630,549) 972,658
Total Trading Results 3,036,910 658,726
Interest Income 758,382 780,999
Change in value of Yield Pool 1,139,825 283,981
Total Revenues 4,935,117 1,723,706
EXPENSES
Brokerage fees 556,582 568,347
Management fees 139,145 141,482
Administrative expenses 29,000 15,000
Transaction fees and costs 24,488 35,500
Total Expenses 749,215 760,329
NET INCOME BEFORE MINORITY INTEREST 4,185,902 963,377
Minority interest in income (68,566) (2,377)
NET INCOME 4,117,336 961,000
NET INCOME ALLOCATION
Limited Partners 4,017,690 941,126
General Partner 99,646 19,874
NET INCOME PER UNIT
Limited Partners 127.27 25.38
General Partner 127.27 25.38
<FN>
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
For the Nine Months Ended September 30,
1997 1996
$ $
REVENUES
<S> <C> <C>
Trading profit (loss):
Realized 4,684,151 (3,403,033)
Net change in unrealized 693,265 453,340
Total Trading Results 5,377,416 (2,949,693)
Interest Income 2,250,466 2,274,839
Change in value of Yield Pool 1,079,210 (3,277,705)
Total Revenues 8,707,092 (3,952,559)
EXPENSES
Brokerage fees (DWR) 1,651,877 1,702,479
Management fees 412,709 421,048
Transaction fees and costs 88,079 116,084
Administrative expenses 83,000 56,000
Total Expenses 2,235,665 2,295,611
INCOME (LOSS) BEFORE MINORITY INTEREST 6,471,427 (6,248,170)
Minority interest in (income) loss (101,526) 113,218
NET INCOME (LOSS) 6,369,901 (6,134,952)
NET INCOME (LOSS) ALLOCATION
Limited Partners 6,217,620 (6,016,526)
General Partner 152,281 (118,426)
NET INCOME (LOSS) PER UNIT
Limited Partners 194.49 (151.24)
General Partners 194.49 (151.24)
<FN>
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' CAPITAL
For the Nine Months Ended September 30, 1997 and 1996
(Unaudited)
<CAPTION>
Units of
Partnership Limited General
Interest Partners Partner Total
<S> <C> <C> <C> <C>
Partners' Capital
December 31, 1995 26,097.968 $39,547,302 $1,224,642 $40,771,944
Subscriptions 13,844.606 21,697,912 - 21,697,912
Net Loss - (6,016,526) (118,426) (6,134,952)
Redemptions (3,786.124) (5,317,340) - (5,317,340)
Partners' Capital
September 30, 1996 36,156.450 $49,911,348 $1,106,216 $51,017,564
Partners' Capital
December 31, 1996 35,036.485 $50,688,703 $1,160,110 $51,848,813
Net Income - 6,217,620 152,281 6,369,901
Redemptions (3,606.829) (5,594,892) - (5,594,892)
Partners' Capital
September 30, 1997 31,429.656 $51,311,431 $1,312,391 $52,623,822
<FN>
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
<TABLE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
For the Nine Months Ended September 30,
1997 1996
$ $
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net income (loss) 6,369,901 (6,134,952)
Noncash item included in net income (loss):
Net change in unrealized (693,265) (453,340)
(Increase) decrease in operating assets:
Net option premiums 724,000 297,250
Investment in zero-coupon U.S.
Treasury Securities 2,170,767 (14,882,668)
Interest receivable (DWR) (10,113) 6,759
Increase (decrease) in operating liabilities:
Accrued administrative fees 6,817 (23,219)
Accrued brokerage fees (DWR) (1,050) 49,105
Accrued management fees (262) 12,276
Accrued transaction fees and costs (1,080) 9,509
Net cash provided by (used for) operating activities 8,565,715 (21,119,280)
CASH FLOWS FROM FINANCING ACTIVITIES
Subscriptions of units - 21,697,912
Increase (decrease) in redemptions payable (110,932) 1,259,771
Minority interest 101,525 (113,218)
Redemptions of units (5,594,892) (5,317,340)
Net cash provided by (used for) financing activities (5,604,299) 17,527,125
Net increase (decrease) in cash 2,961,416 <3,592,155)
Balance at beginning of period 6,625,325 8,897,293
Balance at end of period 9,586,741 5,305,138
<FN>
The accompanying footnotes are an integral part
of these financial statements.
</TABLE>
<PAGE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
The financial statements include, in the opinion of management,
all adjustments necessary for a fair presentation of the results
of operations and financial condition. The consolidated
financial statements and condensed notes herein should be read in
conjunction with the Partnership's December 31, 1996 Annual
Report on Form 10-K.
1. Organization
Dean Witter Principal Plus Fund L.P. (the "Partnership") is a
limited partnership organized to engage in the speculative
trading of commodity futures contracts, commodity options
contracts and forward contracts on foreign currencies
(collectively, "futures interests"). The general partner for the
Partnership is Demeter Management Corporation ("Demeter"). The
commodity broker for most of the Partnership's transactions is
Dean Witter Reynolds Inc. ("DWR"). Demeter has retained RXR Inc.
as the trading manager of the Trading Company. Both Demeter and
DWR are wholly-owned subsidiaries of Morgan Stanley, Dean Witter,
Discover & Co. ("MSDWD").
On July 31, 1997, DWR closed the sale of its institutional
futures business and foreign currency trading operations to Carr
Futures Inc. ("Carr"), a subsidiary of Credit Agricole Indosuez.
Following the sale, Carr became the counterparty on
<PAGE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
the Partnership's foreign currency trades. However, during a
transition period of about four months, DWR will continue to
perform certain services relating to the Partnership's futures
trading including clearance. After such transaction period, DWR
will continue to serve as a non-clearing commodity broker for the
Partnership with Carr providing all clearing services for
Partnership transactions.
2. Revenue Recognition
The investment in zero-coupon U.S. Treasury Securities (the
"Yield Pool") maintained to provide for the Partnership's
guaranteed return is valued at the lesser of cost plus accreted
interest or market value. For the nine months ended September
30, 1997, $1,968,383 of interest income has been accreted on the
Yield Pool. At September 30, 1997, the cost of the Yield Pool was
$42,046,836 and the accreted interest receivable thereon was
$4,093,384. The market value of the Yield Pool on September 30,
1997 is approximately $45,076,888.
3. Related Party Transactions
The Partnership's cash is on deposit with DWR and Carr in
commodity trading accounts to meet margin requirements as needed.
DWR pays interest on these funds based on current 13-week U.S.
Treasury Bill rates. Brokerage expenses incurred by the
Partnership are paid to DWR.
<PAGE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
4. Financial Instruments
The Partnership trades futures, forward contracts and options in
interest rates, stock indices, commodities, currencies, petroleum
and precious metals. Futures and forwards represent contracts
for delayed delivery of an instrument at a specified date and
price.
Risk arises from changes in the value of these contracts and the
potential inability of counterparties to perform under the terms
of the contracts. There are numerous factors which may
significantly influence the market value of these contracts,
including interest rate volatility. At September 30, 1997 and
December 31, 1996, open contracts were:
Contract or Notional Amount
September 30, 1997 December 31, 1996
$ $
Exchange-Traded Contracts
Financial Futures:
Commitments to Purchase 86,864,000 36,738,000
Commitments to Sell 2,846,000 19,776,000
Option Written 19,090,000 -
Commodity Futures:
Commitments to Purchase 3,528,000 5,550,000
Commitments to Sell 5,445,000 5,879,000
Foreign Futures:
Commitments to Purchase 23,101,000 83,456,000
Commitments to Sell 27,232,000 6,403,000
Off-Exchange-Traded
Forward Currency Contracts
Commitments to Purchase 8,973,000 11,219,000
Commitments to Sell 6,772,000 24,545,000
A portion of the amounts indicated as off-balance-sheet risk in
forward currency contracts is due to offsetting forward
commitments to purchase and to sell the same currency on the same
<PAGE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
date in the future. These commitments are economically
offsetting, but are not offset in the forward market until the
settlement date.
The net unrealized gains on open contracts are reported as a
component of "Equity in Commodity futures trading accounts" on
the Statements of Financial Condition and totaled $890,649 and
$197,384 at September 30, 1997 and December 31, 1996,
respectively. Of the $890,649 net unrealized gain on open
contracts at September 30, 1997, $805,409 related to exchange-
traded futures contracts and $85,240 related to off-exchange-
traded forward currency contracts. Of the $197,384 net
unrealized gain on open contracts at December 31, 1996, $302,539
related to exchange-traded futures contracts and $(105,155)
related to off-exchange-traded forward currency contracts.
Exchange-traded futures contracts held by the Partnership at
September 30, 1997 and December 31, 1996 mature through March
1998 and June 1997, respectively. Off-exchange-traded forward
currency contracts held by the Partnership at September 30, 1997
and December 31, 1996 mature through December 1997 and January
1997, respectively. The contract amounts in the above table
represent the Partnership's extent of involvement in the
particular class of financial instrument, but not the credit risk
associated with
<PAGE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
counterparty nonperformance. The credit risk associated with
these statements is limited to the amounts reflected in the
Partnership's Statements of Financial Condition.
The Partnership also has credit risk because either DWR or Carr
acts as the futures commission merchant or the counterparty, with
respect to most of the Partnership's assets. Exchange-traded
futures contracts are marked to market on a daily basis, with
variations in value settled on a daily basis. DWR, as the
futures commission merchant for all of the Partnership's exchange-
traded futures contracts, is required pursuant to regulations of
the Commodity Futures Trading Commission ("CFTC") to segregate
from its own assets and for the sole benefit of its commodity
customers all funds held by DWR with respect to exchange traded
futures contracts including an amount equal to the net unrealized
gain on all open futures contracts, which funds totaled
$10,292,160 and $6,927,864 at September 30, 1997 and December 31,
1996, respectively. With respect to the Partnership's off-
exchange-traded forward currency contracts, there are no daily
settlements of variations in value nor is there any requirement
that an amount equal to the net unrealized gain on open forward
contracts be segregated. With respect to those off-exchange-
traded forward currency contracts, the Partnership is at risk to
the ability of Carr, the sole counterparty on all such contracts,
to perform.
<PAGE>
DEAN WITTER PRINCIPAL PLUS FUND L.P.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONCLUDED)
Carr's parent, Credit Agricole Indosuez, has guaranteed Carr's
obligations to the Partnership.
For the nine months ended September 30, 1997 and the year ended
December 31, 1996, the average fair value of financial
instruments held for trading purposes was as follows:
September 30, 1997
Assets Liabilities
$ $
Exchange-Traded Contracts:
Financial Futures 60,378,000 21,018,000
Options on Financial Futures 2,894,000 5,775,000
Commodity Futures 6,678,000 4,487,000
Foreign Futures 39,830,000 31,170,000
Off-Exchange-Traded Forward
Currency Contracts 16,902,000 25,708,000
December 31, 1996
Assets Liabilities
$ $
Exchange-Traded Contracts:
Financial Futures 48,280,000 20,650,000
Options on Financial Futures 717,000 4,639,000
Commodity Futures 6,775,000 3,814,000
Foreign Futures 51,243,000 17,579,000
Off-Exchange-Traded Forward
Currency Contracts 30,644,000 28,108,000
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity - The Partnership's assets are on deposit in futures
interest trading accounts with DWR and Carr, and are used by the
Partnership as margin to engage in futures interest trading. DWR
and Carr hold such assets in either designated depositories or in
securities approved by the CFTC for investment of customer funds.
The Partnership's assets held by DWR and Carr may be used as
margin solely for the Partnership's trading. Since the
Partnership's sole purpose is to trade in futures interests, it
is expected that the Partnership will continue to own such liquid
assets for margin purposes.
The Partnership's investment in futures interests may, from time
to time, be illiquid. Most United States futures exchanges limit
fluctuations in certain futures interest prices during a single
day by regulations referred to as "daily price fluctuations
limits" or "daily limits". Pursuant to such regulations, during
a single trading day no trades may be executed at prices beyond
the daily limit. If the price of a particular futures interest
has increased or decreased by an amount equal to the "daily
limit", positions in such futures interest can neither be taken
nor liquidated unless traders are willing to effect trades at or
within the limit. Futures interest prices have occasionally
moved the daily limit for several consecutive days with little or
no trading. Such market conditions could prevent the Partnership
from promptly liquidating its futures interests and result in
<PAGE>
restrictions on redemptions. However, since the commencement of
trading by the Partnership, there has never been a time when
illiquidity has affected a material portion of the Partnership's
assets.
There is no limitation on daily price moves in trading forward
contracts on foreign currencies. The markets for some world
currencies have low trading volume and are illiquid, which may
prevent the Partnership from trading in potentially profitable
markets or prevent the Partnership from promptly liquidating
unfavorable positions in such markets and subjecting it to
substantial losses. Either of these market conditions could
result in restrictions on redemptions.
Capital Resources - The Partnership does not have, nor does it
expect to have, any capital assets. Redemptions of additional
Units of Limited Partnership Interest in the future will affect
the amount of funds available for investments in futures
interests in subsequent periods. As redemptions are at the
discretion of the Limited Partners, it is not possible to
estimate the amount and therefore the impact of future
redemptions.
Results of Operations
For the Quarter and Nine Months Ended September 30, 1997
For the quarter ended September 30, 1997, the Partnership's total
trading revenues, including interest income and change in value
of the Yield Pool were $4,935,117.
<PAGE>
During the third quarter, the Partnership posted an increase in
Net Asset Value per Unit. The most significant gains were
recorded in the stock and bond portions of the balanced portfolio
as domestic stock and bond futures prices moved higher during
July and September. Additional gains were recorded in the
managed futures portion of the portfolio as long global interest
rate futures positions also profited from an upward price move
during July and September. Additionally, profits during the
quarter were attributed to an increase in the market value of the
zero-coupon U.S. Treasury Securities held in the guarantee
portion of the Partnership. In currencies, gains were recorded
from short positions in the New Zealand and Singapore dollars as
the value of these currencies declined relative to the U.S.
dollar during July. Smaller gains were recorded in energy
futures as long natural gas futures positions profited from a
dramatic upward price move during August and September. These
gains were partially offset by losses recorded from trendless
price movement in soft commodities and agricultural futures
throughout a majority of the quarter. Total expenses for the
quarter were $749,215, resulting in a net income before minority
interest of $4,185,902. The minority interest in such income was
$68,566 resulting in net income of $4,117,336 for the
Partnership. The value of an individual Unit in the Partnership
increased from $1,547.07 at June 30, 1997 to $1,674.34 at
September 30, 1997.
For the nine months ended September 30, 1997, the Partnership's
total trading revenues including interest income and change in
<PAGE>
value of the Yield Pool were $8,707,092. During the first nine
months of the year, the Partnership posted an increase in Net
Asset Value per Unit. The most significant gains were recorded
in the managed futures portion of the portfolio as the value of
the U.S. dollar strengthened versus most other currencies during
January, February and July. As a result, gains were recorded
from short positions in the Singapore dollar, Italian lira and
Spanish peseta. Additional currency gains were recorded from
transactions involving the German mark and French franc. In the
stock portion of the balanced portfolio, long S&P 500 Index
futures positions profited from a strong increase in domestic
equity prices during the first three quarters. Smaller gains
were recorded during the third quarter from long U.S. and
international bond futures positions as prices in these markets
moved higher. These gains were partially offset by losses from
trendless price movement in agricultural futures and soft
commodities throughout a majority of the year. Smaller losses
recorded in energy futures, as crude oil prices moved in a choppy
pattern during the second and third quarter, also offset a
portion of the Partnership's overall gains. Total expenses for
the period were $2,235,665, resulting in net income before
minority interest of $6,471,427. The minority interest in such
income was $101,526, resulting in net income of $6,369,901 for
the Partnership. The value of an individual Unit in the
Partnership increased from $1,479.85 at December 31, 1996 to
$1,674.34 at September 30, 1997.
<PAGE>
For the Quarter and Nine Months Ended September 30, 1996
For the quarter ended September 30, 1996, the Partnership's total
trading revenues including interest income and change in value of
Yield Pool were $1,723,706. During the third quarter, the
Partnership posted an increase in Net Asset Value per Unit. The
most significant gains were recorded in the managed futures
component of the Partnership's balanced portfolio from trading in
the financial futures, currency and energy markets. In the
financial futures markets, long positions in Australian, Japanese
and European bond futures profited from a steady upward move
during July and September. Additional gains were recorded during
July in the currency markets from long positions in the Swiss and
French francs, as well as in the German mark, as the value of
these currencies finished the month higher versus the U.S.
dollar. In energy markets, long crude oil futures positions
experienced gains as prices trended higher throughout the
quarter. A portion of these gains were offset by losses
experienced in soft commodities as coffee and cotton futures
prices moved in a trendless pattern throughout the quarter. In
the bond component of the portfolio, small trading gains were
recorded as losses from choppy price movement during July and
August were more than offset by gains recorded during September
as U.S. bond futures prices moved higher. In the stock index
portion of the balanced portfolio, losses recorded during July
due to a decline in U.S. stock prices were offset by profits
recorded during September as the S&P 500 Index reached new highs.
Total expenses for the quarter were $760,329, resulting in net
income before minority
<PAGE>
interest of $963,377. The minority interest in such income was
$2,377 resulting in net income of $961,000 for the Partnership.
The value of an individual Unit in the Partnership increased from
$1,385.64 at June 30, 1996 to $1,411.02 at September 30, 1996.
For the nine months ended September 30, 1996, the Partnership's
total trading losses net of interest income and change in value
of the Yield Pool were $3,952,559. During the first nine months,
the Partnership posted a decrease in Net Asset Value per Unit.
The most significant losses were recorded in the bond portion, as
well as in the guarantee portion, of the portfolio as U.S.
Treasury bond prices moved lower during the first quarter. As a
result, the Partnership's long U.S. Treasury bond futures
positions recorded losses and the value of the Yield Pool
declined. Smaller losses were recorded in the bond portion
during the second quarter, as well as early in third quarter, as
the downward price movement continued into April and May and was
then followed by choppy movement. Smaller losses recorded in the
managed futures component were due to trendless price movement in
soft commodities and base metals throughout the first nine months
of the year. In the stock index component, small losses were
recorded between March and July as S&P 500 Index futures prices
experienced short-term volatility. A portion of the
Partnership's overall losses was offset by gains recorded in the
energy markets as long crude oil futures positions profited from
an upward price trend, particularly during the third quarter.
Smaller gains during the second quarter from long corn futures
positions also helped to
<PAGE>
mitigate losses experienced elsewhere during the year. Total
expenses for the period were $2,295,611, resulting in a net loss
before minority interest of $6,248,170. The minority interest in
such loss was $113,218 resulting in a net loss of $6,134,952 for
the Partnership. The value of an individual Unit in the
Partnership decreased from $1,562.26 at December 31, 1995 to
$1,411.02 at September 30, 1996.
<PAGE>
PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
On September 6, 10, and 20, 1996, and on March 13, 1997, similar
purported class actions were filed in the Superior Court of the
State of California, County of Los Angeles, on behalf of all
purchasers of interests in limited partnership commodity pools
sold by DWR. Named defendants include DWR, Demeter, Dean Witter
Futures & Currency Management, Inc., MSDWD (all such parties
referred to hereafter as the "Dean Witter Parties"), certain
limited partnership commodity pools of which Demeter is the
general partner, and certain trading advisors to those pools. On
June 16, 1997, the plaintiffs in the above actions filed a
consolidated amended complaint. Similar purported class actions
were also filed on September 18 and 20, 1996 in the Supreme Court
of the State of New York, New York County, and on November 14,
1996 in the Superior Court of the State of Delaware, New Castle
County, against the Dean Witter Parties and certain trading
advisors on behalf of all purchasers of interests in various
limited partnership commodity pools sold by DWR. Generally,
these complaints allege, among other things, that the defendants
committed fraud, deceit, misrepresentation, breach of fiduciary
duty, fraudulent and unfair business practices, unjust
enrichment, and conversion in connection with the sale and
operation of the various limited partnership commodity pools.
The complaints seek unspecified amounts of compensatory and
punitive damages and other relief. It is possible that
additional similar actions may be filed and that, in the course
of these actions, other parties
<PAGE>
could be added as defendants. The Dean Witter Parties believe
that they have strong defenses to, and they will vigorously
contest, the actions. Although the ultimate outcome of legal
proceedings cannot be predicted with certainty, it is the opinion
of management of the Dean Witter Parties that the resolution of
the actions will not have a material adverse effect on the
financial condition or the results of operations of any of the
Dean Witter Parties.
Item 5. OTHER INFORMATION
On July 21, 1997, MSDWD, the sole shareholder of Demeter,
appointed a new Board of Directors consisting of Richard M.
DeMartini, Mark J. Hawley, Lawrence Volpe, Joseph G. Siniscalchi,
Edward C. Oelsner III, and Robert E. Murray.
<PAGE>
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) Exhibits - None.
(B) Reports on Form 8-K. - None.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Dean Witter Principal Plus
Fund L.P. (Registrant)
By: Demeter Management
Corporation
(General Partner)
November 7, 1997 By:/s/ Patti L. Behnke
Patti L. Behnke
Chief Financial Officer
The General Partner which signed the above is the only party
authorized to act for the Registrant. The Registrant has no
principal executive officer, principal financial officer,
controller, or principal accounting officer and has no Board of
Directors.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from Dean
Witter Principal Plus Fund L.P. and is quallified in its entirety by
reference to such financial instruments.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-END> SEP-30-1997
<CASH> 9,586,741
<SECURITIES> 0
<RECEIVABLES> 36,741
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 54,867,019<F1>
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 54,867,019<F2>
<SALES> 0
<TOTAL-REVENUES> 8,707,092<F3>
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,235,665
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 6,369,901
<INCOME-TAX> 0
<INCOME-CONTINUING> 6,369,901
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,369,901
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1>In addition to cash and receivables, total assets include net unrealized
gain on open contracts of $890,649, Investment in U.S. Treasury Bills of
$45,076,888 and net option premiums ($724,000).
<F2>Liabilities include redemptions payable of $1,546,448, accrued brokerage
fee of $185,724, accrued administrative fees of $210,067, accrued
management fee of $46,431, and accrued transaction fees and costs of
$3,028.
<F3>Total revenue includes realized trading revenue of $4,684,151, net
change in unrealized of $693,265, interest income of $2,250,466 and
change in valuation of Yield Pool of $1,079,210.
</FN>
</TABLE>
