<PAGE>
PROSPECTUS - FEBRUARY 22, 1999
Morgan Stanley Dean Witter
PRECIOUS METALS AND MINERALS TRUST
[COVER PHOTO]
A MUTUAL FUND THAT SEEKS LONG-TERM CAPITAL APPRECIATION
The Securities and Exchange Commission has not approved or disapproved these
securities or passed upon the
adequacy of this Prospectus. Any representation to the contrary is a criminal
offense.
<PAGE>
CONTENTS
<TABLE>
<S> <C> <C>
The Fund Investment Objective.................................. 1
Principal Investment Strategies....................... 1
Principal Risks....................................... 1
Past Performance...................................... 3
Fees and Expenses..................................... 4
Additional Investment Strategy Information............ 5
Additional Risk Information........................... 5
Fund Management....................................... 6
Shareholder Information Pricing Fund Shares................................... 7
How to Buy Shares..................................... 8
How to Exchange Shares................................ 9
How to Sell Shares.................................... 11
Distributions......................................... 12
Tax Consequences...................................... 13
Share Class Arrangements.............................. 14
Financial Highlights ...................................................... 21
Our Family of Funds ...................................................... Inside Back Cover
THIS PROSPECTUS CONTAINS IMPORTANT INFORMATION ABOUT THE FUND.
PLEASE READ IT CAREFULLY AND KEEP IT FOR FUTURE REFERENCE.
</TABLE>
FUND CATEGORY
---------------------------
/X/ GROWTH
/ / Growth and Income
/ / Income
/ / Money Market
<PAGE>
(SIDEBAR)
CAPITAL GROWTH
AN INVESTMENT OBJECTIVE HAVING THE GOAL OF SELECTING SECURITIES WITH THE
POTENTIAL TO RISE IN VALUE RATHER THAN PAY OUT INCOME.
(END SIDEBAR)
THE FUND
ICON INVESTMENT OBJECTIVE
- --------------------------------------------------------------------------------
Morgan Stanley Dean Witter Precious Metals and Minerals Trust (the
"Fund") is a mutual fund that seeks long-term capital appreciation.
There is no guarantee that the Fund will achieve this objective.
ICON PRINCIPAL INVESTMENT STRATEGIES
- --------------------------------------------------------------------------------
The Fund will normally invest at least 65% of its assets in the
common stock and other securities of foreign and domestic companies
principally engaged in the precious metals and minerals business. The
companies may engage in the exploration, mining, fabrication,
processing, distribution or trading of precious metals and minerals
-- or in financing, managing or operating companies engaged in these
activities. A company is considered to be principally engaged in
these activities if it derives a majority of its income from, or
devotes a majority of its assets to, the activities. The Fund's
"Investment
Manager," Morgan Stanley Dean Witter Advisors Inc., invests in
companies that it believes have growth potential based on a wide
variety of factors.
Because most of the world's gold production is outside of the United
States, a majority of the Fund's assets may be invested in the
securities of foreign companies.
Common stock is a share ownership or equity interest in a
corporation. It may or may not pay dividends, as some companies
reinvest all of their profits back into their businesses, while
others pay out some of their profits to shareholders as dividends.
The Fund also may invest a portion of its assets in gold, silver,
platinum and palladium bullion and coins (or certificates, receipts
or contracts representing ownership interests in these precious
metals).
In pursuing the Fund's investment objective, the Investment Manager
has considerable leeway in deciding which investments it buys, holds
or sells on a day-to-day basis -- and which trading strategies it
uses. For example, the Investment Manager in its discretion may
determine to use some permitted trading strategies while not using
others. In addition to the investments discussed above, the Fund may
invest in common stocks of companies that are not primarily engaged
in the precious metals or minerals business, long-term U.S.
Government Securities and money market instruments.
ICON PRINCIPAL RISKS
- --------------------------------------------------------------------------------
The Fund's share price will fluctuate with changes in the market
value of the Fund's portfolio securities. When you sell Fund shares,
they may be worth less than what you paid for them and, accordingly,
you can lose money investing in this Fund.
1
<PAGE>
PRECIOUS METALS AND MINERALS. The Fund's investments related to gold
and other precious metals and minerals are considered speculative and
are impacted by a host of world-wide economic, financial and
political factors. Prices of gold and other precious metals may
fluctuate widely over short periods of time due to changes in
inflation or expectations regarding inflation in various countries,
the availability of supplies of these precious metals, changes in
industrial and commercial demand, and metal sales by governments,
central banks or international agencies. Prices also may fluctuate
widely due to investment speculation, monetary and other economic
policies of various governments and governmental restrictions on the
private ownership of certain precious metals and minerals.
Additionally, the precious metals and minerals securities in which
the Fund may invest may not necessarily move in tandem with the
prices of actual precious metals and minerals.
At the present time, there are five major producers of gold bullion.
In order of magnitude they are: the Republic of South Africa, the
successor states of the former Soviet Union, Canada, the United
States and Australia. Political and economic conditions in these
countries may have a direct effect on the mining, distribution and
price of gold and sales of central bank gold holdings.
CONCENTRATION POLICY. Unlike most industry diversified mutual funds,
the Fund is subject to the risks associated with concentrating its
assets in a particular industry -- precious metals and minerals.
Thus, the Fund's overall portfolio may decline in value due to
developments specific to this industry. Given the Fund's
concentration policy, Fund shares should not be considered a complete
investment program.
COMMON STOCK. In general, stock values fluctuate in response to
activities specific to the company as well as general market,
economic and political conditions. Stock prices can fluctuate widely
in response to these factors.
FOREIGN SECURITIES. The Fund's investments in foreign securities
(including depository receipts) involve risks that are in addition to
the risks associated with domestic securities. One additional risk is
currency risk. While the price of Fund shares is quoted in U.S.
dollars, the Fund generally converts U.S. dollars to a foreign
market's local currency to purchase a security in that market. If the
value of that local currency falls relative to the U.S. dollar, the
U.S. dollar value of the foreign security will decrease. This is true
even if the foreign security's local price remains unchanged.
Foreign securities also have risks related to economic and political
developments abroad, including expropriations, confiscatory taxation,
exchange control regulation, limitations on the use or transfer of
Fund assets and any effects of foreign social, economic or political
instability. Foreign companies, in general, are not subject to the
regulatory requirements of U.S. companies and, as such, there may be
less publicly available information about these companies. Moreover,
foreign accounting, auditing and financial reporting standards
generally are different from those applicable to U.S. companies.
Finally, in the event of a default of any foreign debt obligations,
it may be more difficult for the Fund to obtain or enforce a judgment
against the issuers of the securities.
Securities of foreign issuers may be less liquid than comparable
securities of U.S. issuers and, as such, their price changes may be
more volatile. Furthermore, foreign exchanges and broker-dealers are
generally subject to less government and exchange scrutiny and
regulation than their U.S. counterparts.
Many European countries have adopted or are in the process of
adopting a single European currency, referred to as the "euro." The
consequences of the euro conversion
2
<PAGE>
for foreign exchange rates, interest rates and the value of European
securities the Fund may purchase are presently unclear. The
consequences may adversely affect the value and/or increase the
volatility of securities held by the Fund.
OTHER RISKS. The performance of the Fund also will depend on whether
or not the Investment Manager is successful in pursuing the Fund's
investment strategy. The Fund is also subject to other risks from its
permissible investments including the risks associated with
fixed-income securities. For more information about these risks, see
the "Additional Risk Information" section.
Shares of the Fund are not bank deposits and are not guaranteed or
insured by any bank, governmental entity, or the FDIC.
ICON PAST PERFORMANCE
- --------------------------------------------------------------------------------
The bar chart and table below provide some indication of the risks of
investing in the Fund. The Fund's past performance does not indicate
(SIDEBAR) how the Fund will perform in the future.
ANNUAL TOTAL RETURNS
THIS CHART SHOWS HOW THE PERFORMANCE OF THE FUND'S CLASS B SHARES HAS VARIED
FROM YEAR TO YEAR DURING THE LIFE OF THE FUND.
AVERAGE ANNUAL
TOTAL RETURNS
THIS TABLE COMPARES THE FUND'S AVERAGE ANNUAL RETURNS WITH THOSE OF A BROAD
MEASURE OF MARKET PERFORMANCE OVER TIME. THE FUND'S RETURNS INCLUDE THE MAXIMUM
APPLICABLE SALES CHARGE FOR EACH CLASS AND ASSUME YOU SOLD YOUR SHARES AT THE
END OF EACH PERIOD.
(END SIDEBAR)
ANNUAL TOTAL RETURNS - CALENDAR YEARS
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
1990* -10.42%
91 -4.41%
92 -9.95%
93 55.90%
94 -11.54%
95 4.97%
96 1.62%
97 -43.13%
98 -14.39%
</TABLE>
* For the period August 6, 1990 through December 31, 1990.
The bar chart reflects the performance of Class B shares; the performance of the
other Classes will differ because the Classes have different ongoing fees. The
performance information in the bar chart does not reflect the deduction of sales
charges; if these amounts were reflected, returns would be less than shown.
During the periods shown in the bar chart, the highest return for a calendar
quarter was 24.77% (quarter ended June 30, 1993) and the lowest return for a
calendar quarter was -31.76% (quarter ended December 31, 1997).
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS (FOR THE PERIODS ENDED THE 1998 CALENDAR YEAR)
- --------------------------------------------------------------------------------
PAST 1 YEAR PAST 5 YEARS LIFE OF FUND
(SINCE 8/6/90)
<S> <C> <C> <C>
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Class A -18.33% -- --
- --------------------------------------------------------------------------------
Class B(1) -18.67% -14.71% -6.82%
- --------------------------------------------------------------------------------
Class C -15.24% -- --
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Class D -14.51% -- --
- --------------------------------------------------------------------------------
S&P 500(2) 28.58% 24.05% 19.77%
- --------------------------------------------------------------------------------
Lipper Gold-Oriented Funds
Index(3) -12.80% -14.29% -5.68%(4)
- --------------------------------------------------------------------------------
</TABLE>
1 Prior to July 28, 1997, the Fund only issued Class B shares.
2 The S&P 500-Registered Trademark- is Standard &
Poor's-Registered Trademark- 500 Composite Stock Price Index, a widely
recognized, unmanaged index of common stock prices. The Index is unmanaged,
and should not be considered an investment.
3 The Lipper Gold-Oriented Funds Index is an equally-weighted performance
index of the largest qualifying funds (based on net assets) in the Lipper
Gold-Oriented Funds objective. The Index, which is adjusted for capital
gains distributions and income dividends, is unmanaged and should not be
considered an investment. There are currently 10 funds represented in this
index.
4 For the Period August 31, 1990 to December 31, 1998.
3
<PAGE>
(SIDEBAR)
SHAREHOLDER FEES
THESE FEES ARE PAID DIRECTLY FROM YOUR INVESTMENT.
ANNUAL FUND
OPERATING EXPENSES
THESE EXPENSES ARE DEDUCTED FROM THE FUND'S ASSETS AND ARE BASED ON EXPENSES
PAID FOR THE FISCAL YEAR ENDED OCTOBER 31, 1998.
(END SIDEBAR)
ICON FEES AND EXPENSES
- --------------------------------------------------------------------------------
The Fund offers four Classes of shares: Classes A, B, C and D. Each
Class has a different combination of fees, expenses and other
features. The table below briefly describes the fees and expenses
that you may pay if you buy and hold shares of the Fund. The Fund
does not charge account or exchange fees. See the "Share Class
Arrangements" section for further fee and expense information.
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C CLASS D
<S> <C> <C> <C> <C>
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SHAREHOLDER FEES
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Maximum sales charge (load) imposed on purchases (as a
percentage of offering price) 5.25%(1) None None None
- ---------------------------------------------------------------------------------------------------
Maximum deferred sales charge (load) (as a percentage based
on the lesser of the offering price or net asset value at
redemption) None(2) 5.00%(3) 1.00%(4) None
- ---------------------------------------------------------------------------------------------------
ANNUAL FUND OPERATING EXPENSES
- ---------------------------------------------------------------------------------------------------
Management Fee 0.80% 0.80% 0.80% 0.80%
- ---------------------------------------------------------------------------------------------------
Distribution and service (12b-1) fees 0.23% 1.00% 1.00% None
- ---------------------------------------------------------------------------------------------------
Other expenses 0.98% 0.98% 0.98% 0.98%
- ---------------------------------------------------------------------------------------------------
Total annual Fund operating expenses 2.01% 2.78% 2.78% 1.78%
- ---------------------------------------------------------------------------------------------------
</TABLE>
1 Reduced for purchases of $25,000 and over.
2 Investments that are not subject to any sales charge at the time of
purchase are subject to a contingent deferred sales charge ("CDSC") of
1.00% that will be imposed on sales made within one year after purchase,
except for certain specific circumstances.
3 The CDSC is scaled down to 1.00% during the sixth year, reaching zero
thereafter. See "Share Class Arrangements" for a complete discussion of the
CDSC.
4 Only applicable to sales made within one year after purchase.
EXAMPLE
This example is intended to help you compare the cost of investing in
the Fund with the cost of investing in other mutual funds.
The example assumes that you invest $10,000 in the Fund, your
investment has a 5% return each year, and the Fund's operating
expenses remain the same. Although your actual costs may be higher or
lower, the tables below show your costs at the end of each period
based on these assumptions depending upon whether or not you sell
your shares at the end of each period.
<TABLE>
<CAPTION>
IF YOU SOLD YOUR SHARES IF YOU HELD YOUR SHARES
----------------------------------------- -----------------------------------------
1 YEAR 3 YEARS 5 YEARS 10 YEARS 1 YEAR 3 YEARS 5 YEARS 10 YEARS
<S> <C> <C> <C> <C> <C> <C> <C> <C>
- ---------------------------------------------------------- -----------------------------------------
CLASS A $718 $1,122 $1,551 $2,740 $718 $1,122 $1,551 $2,740
- ---------------------------------------------------------- -----------------------------------------
CLASS B $781 $1,162 $1,669 $3,109 $281 $ 862 $1,469 $3,109
- ---------------------------------------------------------- -----------------------------------------
CLASS C $381 $ 862 $1,469 $3,109 $281 $ 862 $1,469 $3,109
- ---------------------------------------------------------- -----------------------------------------
CLASS D $181 $ 560 $ 964 $2,095 $181 $ 560 $ 964 $2,095
- ---------------------------------------------------------- -----------------------------------------
</TABLE>
4
<PAGE>
ICON ADDITIONAL INVESTMENT STRATEGY INFORMATION
- --------------------------------------------------------------------------------
This section provides additional information concerning the Fund's
principal strategies.
COMMON STOCKS AND OTHER SECURITIES. As discussed in the "Principal
Investment Strategies" section, the Fund will normally invest at
least 65% of its assets in the common stocks and other securities of
companies engaged in the precious metals and minerals business. The
other securities in which the Fund may invest include securities
convertible into common stocks, preferred stocks and debt securities
(including zero coupon bonds). The Fund's policy to concentrate its
investments in the precious metals and minerals business, except
during temporary "defensive" periods discussed below, is a
fundamental policy. A fundamental policy may not be changed without
shareholder approval.
OTHER INVESTMENTS. The Fund also may invest up to 35% of its assets,
under normal market conditions, in common stocks of companies that
are not primarily engaged in the precious metals or minerals
business, long-term U.S. Government securities and money market
instruments.
DEFENSIVE INVESTING. The Fund may take temporary "defensive"
positions in attempting to respond to adverse market conditions. The
Fund may invest any amount of its assets in cash or money market
instruments in a defensive posture when the Investment Manager
believes it is advisable to do so. Although taking a defensive
posture is designed to protect the Fund from an anticipated market
downturn, it could have the effect of reducing the benefit from any
upswing in the market.
The percentage limitations relating to the composition of the Fund's
portfolio apply at the time the Fund acquires an investment.
Subsequent percentage changes that result from market fluctuations or
changes in assets will not require the Fund to sell any portfolio
security. The Fund may change its principal investment strategies
(except for its concentration policy for 65% of its assets) without
shareholder approval; however, you would be notified of any changes.
ICON ADDITIONAL RISK INFORMATION
- --------------------------------------------------------------------------------
This section provides information regarding the principal risks of
investing in the Fund in addition to those discussed in the
"Principal Risks" section.
OTHER SECURITIES AND INVESTMENTS. In addition to common stocks, the
Fund may invest in fixed-income securities, such as preferred stock,
corporate debt securities and U.S. Government securities. All
fixed-income securities are subject to two types of risk: credit risk
and interest rate risk. Credit risk refers to the possibility that
the issuer of a security will be unable to make interest payments and
repay the principal on its debt.
Interest rate risk refers to fluctuations in the value of a
fixed-income security resulting from changes in the general level of
interest rates. When the general level of interest rates goes up, the
price of most fixed-income securities goes down. When the general
level of interest rates goes down, the price of most fixed-income
securities goes up.
5
<PAGE>
(Zero coupon securities are typically subject to greater price
fluctuations than comparable securities that pay interest.) Preferred
stock also has risk characteristics similar to those of common
stocks.
YEAR 2000. The Fund could be adversely affected if the computer
systems necessary for the efficient operation of the Investment
Manager, the Fund's other service providers and the markets and
individual and governmental issuers in which the Fund invests do not
properly process and calculate date-related information from and
after January 1, 2000. While year 2000-related computer problems
could have a negative effect on the Fund, the Investment Manager and
affiliates are working hard to avoid any problems and to obtain
assurances from their service providers that they are taking similar
steps.
ICON FUND MANAGEMENT
- --------------------------------------------------------------------------------
The Fund has retained the Investment Manager -- Morgan Stanley Dean
Witter Advisors Inc. -- to provide administrative services, manage
its business affairs and invest its assets, including the placing
of orders for the purchase and sale of portfolio securities. The
Investment Manager is a wholly-owned subsidiary of Morgan Stanley
Dean Witter & Co., a preeminent global financial services firm that
maintains leading market positions in each of its three primary
businesses: securities, asset management and credit services. Its
main business office is located at Two World Trade Center, New
(SIDEBAR) York, NY 10048.
MORGAN STANLEY DEAN WITTER ADVISORS INC.
THE INVESTMENT MANAGER IS WIDELY RECOGNIZED AS A LEADER IN THE MUTUAL FUND
INDUSTRY AND TOGETHER WITH MORGAN STANLEY DEAN WITTER SERVICES COMPANY INC., ITS
WHOLLY-OWNED SUBSIDIARY, HAS MORE THAN $127 BILLION IN ASSETS UNDER MANAGEMENT
OR ADMINISTRATION AS OF JANUARY 31, 1999.
(END SIDEBAR)
The Fund's portfolio is managed within Investment Manager's Growth Group. Robert
Rossetti, a Vice President of the Investment Manager, and a member of Investment
Manager's Growth Group, has been the primary portfolio manager of the Fund since
December of 1996. Prior to joining Investment Manager in May of 1995, Mr.
Rossetti was a Vice President at Merrill Lynch & Co. Inc. (November 1994-April
1995) and prior thereto was a Vice President at Prudential Securities for six
years.
The Fund pays the Investment Manager a monthly management fee as full
compensation for the services and facilities furnished to the Fund, and for Fund
expenses assumed by the Investment Manager. The fee is based on the Fund's
average daily net assets. For the fiscal year ended October 31, 1998 the Fund
accrued total compensation to the Investment Manager amounting to 0.80% of the
Fund's average daily net assets.
6
<PAGE>
SHAREHOLDER INFORMATION
ICON PRICING FUND SHARES
- --------------------------------------------------------------------------------
The price of Fund shares (excluding sales charges), called "net asset
value," is based on the value of the Fund's portfolio securities. While the
assets of each Class are invested in a single portfolio of securities, the
net asset value of each Class will differ because the Classes have different
ongoing distribution fees.
The net asset value per share of the Fund is determined once daily at 4:00
p.m. Eastern time on each day that the New York Stock Exchange is open (or,
on days when the New York Stock Exchange closes prior to 4:00 p.m., at such
earlier time). Shares will not be priced on days that the New York Stock
Exchange is closed.
The value of the Fund's portfolio securities is based on the securities'
market price when available. When a market price is not readily available,
including circumstances under which the Investment Manager determines that a
security's market price is not accurate, a portfolio security is valued at
its fair value, as determined under procedures established by the Fund's
Board of Trustees. In these cases, the Fund's net asset value will reflect
certain portfolio securities' fair value rather than their market price. In
addition, if the Fund holds securities primarily listed on foreign
exchanges, the value of the Fund's portfolio securities may change on days
when you will not be able to purchase or sell your shares.
An exception to the Fund's general policy of using market prices concerns
its short-term debt portfolio securities. Debt securities with remaining
maturities of sixty days or less at the time of purchase are valued at
amortized cost. However, if the cost does not reflect the securities' market
value, these securities will be valued at their fair value.
7
<PAGE>
(SIDEBAR)
CONTACTING A FINANCIAL ADVISOR
IF YOU ARE NEW TO THE MORGAN STANLEY DEAN WITTER FAMILY OF FUNDS AND WOULD LIKE
TO CONTACT A FINANCIAL ADVISOR, CALL (800) THE-DEAN FOR THE TELEPHONE NUMBER OF
THE MORGAN STANLEY DEAN WITTER OFFICE NEAREST YOU.
YOU MAY ALSO ACCESS OUR OFFICE LOCATOR ON OUR INTERNET SITE AT:
WWW.DEANWITTER.COM/FUNDS
EASYINVEST-SM-
A PURCHASE PLAN THAT ALLOWS YOU TO TRANSFER MONEY AUTOMATICALLY FROM YOUR
CHECKING OR SAVINGS ACCOUNT OR FROM A MONEY MARKET FUND ON A SEMI-MONTHLY,
MONTHLY OR QUARTERLY BASIS. CONTACT YOUR MORGAN STANLEY DEAN WITTER FINANCIAL
ADVISOR FOR FURTHER INFORMATION ABOUT THIS SERVICE.
(END SIDEBAR)
ICON HOW TO BUY SHARES
- --------------------------------------------------------------------------------
You may open a new account to buy Fund shares or buy additional Fund shares
for an existing account by contacting your Morgan Stanley Dean Witter
Financial Advisor or other authorized financial representative. Your
Financial Advisor will assist you, step-by-step, with the procedures to
invest in the Fund. You may also purchase shares directly by calling the
Fund's transfer agent and requesting an application.
Because every investor has different immediate financial needs and long-term
investment goals, the Fund offers investors four Classes of shares: Classes
A, B, C and D. Class D shares are only offered to a limited group of
investors. Each Class of shares offers a distinct structure of sales
charges, distribution and service fees, and other features that are designed
to address a variety of needs. Your Financial Advisor or other authorized
financial representative can help you decide which Class may be most
appropriate for you. When purchasing Fund shares, you must specify which
Class of shares you wish to purchase.
When you buy Fund shares, the shares are purchased at the next share price
calculated (less any applicable front-end sales charge for Class A shares)
after we receive your investment order in proper form. We reserve the right
to reject any order for the purchase of Fund shares.
<TABLE>
<CAPTION>
MINIMUM INVESTMENT AMOUNTS
- ------------------------------------------------------------------------------------------------
MINIMUM INVESTMENT
----------------------
INVESTMENT OPTIONS INITIAL ADDITIONAL
<S> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
Regular Accounts $ 1,000 $ 100
- ------------------------------------------------------------------------------------------------
Individual Retirement Accounts: Regular IRAs $ 1,000 $ 100
Education IRAs $500 $ 100
- ------------------------------------------------------------------------------------------------
EASYINVEST-SM- (Automatically from your checking
or savings account or Money Market
Fund) $100* $ 100*
- ------------------------------------------------------------------------------------------------
</TABLE>
* Provided your schedule of investments totals $1,000 in twelve months.
There is no minimum investment amount if you purchase Fund shares through: (1)
the Investment Manager's mutual fund asset allocation plan, (2) a program,
approved by the Fund's distributor, in which you pay an asset-based fee for
advisory, administrative and/or brokerage services, or (3) employer-sponsored
employee benefit plan accounts.
INVESTMENT OPTIONS FOR CERTAIN INSTITUTIONAL AND OTHER INVESTORS/CLASS D
SHARES. To be eligible to purchase Class D shares, you must qualify under
one of the investor categories specified in the "Share Class Arrangements"
section of this PROSPECTUS.
8
<PAGE>
THREE DAY SETTLEMENT. Fund shares are sold through the Fund's distributor,
Morgan Stanley Dean Witter Distributors Inc., on a normal three business
day basis; that is, your payment for Fund shares is due on the third
business day (settlement day) after you place a purchase order.
SUBSEQUENT INVESTMENTS SENT DIRECTLY TO THE FUND. In addition to buying
additional Fund shares for an existing account by contacting your Morgan
Stanley Dean Witter Financial Advisor or other authorized financial
representative, you may send a check directly to the Fund. To buy
additional shares in this manner:
- Write a "letter of instruction" to the Fund specifying the name(s) on the
account, the account number, the social security or tax identification
number, the Class of shares you wish to purchase and the investment
amount (which would include any applicable front-end sales charge). The
letter must be signed by the account owner(s).
- Make out a check for the total amount payable to: Morgan Stanley Dean
Witter Precious Metals and Minerals Trust.
- Mail the letter and check to Morgan Stanley Dean Witter Trust FSB at P.O.
Box 1040, Jersey City, NJ 07303.
ICON HOW TO EXCHANGE SHARES
- --------------------------------------------------------------------------------
PERMISSIBLE FUND EXCHANGES. You may exchange shares of any Class of the
Fund for the same Class of any other continuously offered Multi-Class Fund,
or for shares of a No-Load Fund, Money Market Fund or Short-Term U.S.
Treasury Trust, without the imposition of an exchange fee. See the inside
back cover of this PROSPECTUS for each Morgan Stanley Dean Witter Fund's
designation as a Multi-Class Fund, No-Load Fund or Money Market Fund. If a
Morgan Stanley Dean Witter Fund is not listed, consult the inside back
cover of that Fund's PROSPECTUS for its designation. For purposes of
exchanges, shares of FSC Funds (subject to a front-end sales charge) are
treated as Class A shares of a Multi-Class Fund.
Exchanges may be made after shares of the Fund acquired by purchase have
been held for thirty days. There is no waiting period for exchanges of
shares acquired by exchange or dividend reinvestment. The current
PROSPECTUS for each fund describes its investment objective(s), policies
and investment minimums, and should be read before investment.
EXCHANGE PROCEDURES. You can process an exchange by contacting your Morgan
Stanley Dean Witter Financial Advisor or other authorized financial
representative. Otherwise, you must forward an exchange privilege
authorization form to the Fund's transfer agent -- Morgan Stanley Dean
Witter Trust FSB -- and then write the transfer agent or call (800)
869-NEWS to place an exchange order. You can obtain an exchange privilege
authorization form by contacting your Financial Advisor or other authorized
financial representative, or by calling (800) 869-NEWS. If you hold share
certificates, no exchanges may be processed until we have received all
applicable share certificates.
9
<PAGE>
An exchange to any Morgan Stanley Dean Witter Fund (except a Money Market
Fund) is made on the basis of the next calculated net asset values of the
Funds involved after the exchange instructions are accepted. When
exchanging into a Money Market Fund, the Fund's shares are sold at their
next calculated net asset value and the Money Market Fund's shares are
purchased at their net asset value on the following business day.
The Fund may terminate or revise the exchange privilege upon required
notice. Certain services normally available to shareholders of Money Market
Funds, including the check writing privilege, are not available for Money
Market Fund shares you acquire in an exchange.
TELEPHONE EXCHANGES. For your protection when calling Morgan Stanley Dean
Witter Trust FSB, we will employ reasonable procedures to confirm that
exchange instructions communicated over the telephone are genuine. These
procedures may include requiring various forms of personal identification
such as name, mailing address, social security or other tax identification
number. Telephone instructions also may be recorded.
Telephone instructions will be accepted if received by the Fund's transfer
agent between 9:00 a.m. and 4:00 p.m. Eastern time on any day the New York
Stock Exchange is open for business. During periods of drastic economic or
market changes, it is possible that the telephone exchange procedures may
be difficult to implement, although this has not been the case with the
Fund in the past.
MARGIN ACCOUNTS. If you have pledged your Fund shares in a margin account,
contact your Morgan Stanley Dean Witter Financial Advisor or other
authorized financial representative regarding restrictions on the exchange
of such shares.
TAX CONSIDERATIONS OF EXCHANGES. If you exchange shares of the Fund for
shares of another Morgan Stanley Dean Witter Fund there are important tax
considerations. For tax purposes, the exchange out of the Fund is
considered a sale of Fund shares -- and the exchange into the other Fund is
considered a purchase. As a result, you may realize a capital gain or loss.
You should review the "Tax Consequences" section and consult your own tax
professional about the tax consequences of an exchange.
FREQUENT EXCHANGES. A pattern of frequent exchanges may result in the Fund
limiting or prohibiting, at its discretion, additional purchases and/or
exchanges. The Fund will notify you in advance of limiting your exchange
privileges.
CDSC CALCULATIONS ON EXCHANGES. See the "Share Class Arrangements" section
of this PROSPECTUS for a further discussion of how applicable contingent
deferred sales charges (CDSCs) are calculated for shares of one Morgan
Stanley Dean Witter Fund that are exchanged for shares of another.
FOR FURTHER INFORMATION REGARDING EXCHANGE PRIVILEGES, YOU SHOULD CONTACT
YOUR MORGAN STANLEY DEAN WITTER FINANCIAL ADVISOR OR OTHER AUTHORIZED
FINANCIAL REPRESENTATIVE, OR CALL (800) 869-NEWS.
10
<PAGE>
(SIDEBAR)
SYSTEMATIC WITHDRAWAL PLAN
THIS PLAN ALLOWS YOU TO WITHDRAW MONEY AUTOMATICALLY FROM YOUR FUND ACCOUNT AT
REGULAR INTERVALS. CONTACT YOUR MORGAN STANLEY DEAN WITTER FINANCIAL ADVISOR FOR
MORE DETAILS.
(END SIDEBAR)
ICON HOW TO SELL SHARES
- --------------------------------------------------------------------------------
You can sell some or all of your Fund shares at any time. If you sell Class
A, Class B or Class C shares, your net sale proceeds are reduced by the
amount of any applicable CDSC. Your shares will be sold at the next price
calculated after we receive your order to sell as described below.
<TABLE>
<CAPTION>
OPTIONS PROCEDURES
<S> <C>
- --------------------------------------------------------------------------------
Contact Your To sell your shares, simply call your Morgan Stanley Dean
Financial Advisor Witter Financial Advisor or other authorized financial
representative.
------------------------------------------------------------
ICON Payment will be sent to the address to which the account is
registered or deposited in your brokerage account.
- --------------------------------------------------------------------------------
By Letter You can also sell your shares by writing a "letter of
instruction" that includes:
ICON
- your account number;
- the dollar amount or the number of shares you wish to
sell;
- the Class of shares you wish to sell; and
- the signature of each owner as it appears on the account.
------------------------------------------------------------
If you are requesting payment to anyone other than the
registered owner(s) or that payment be sent to any address
other than the address of the registered owner(s) or
pre-designated bank account, you will need a signature
guarantee. You can obtain a signature guarantee from an
eligible guarantor acceptable to Morgan Stanley Dean Witter
Trust FSB. (You should contact Morgan Stanley Dean Witter
Trust FSB at (800) 869-NEWS for a determination as to
whether a particular institution is an eligible guarantor.)
A notary public CANNOT provide a signature guarantee.
Additional documentation may be required for shares held by
a corporation, partnership, trustee or executor.
------------------------------------------------------------
Mail the letter to Morgan Stanley Dean Witter Trust FSB at
P.O. Box 983, Jersey City, NJ 07303. If you hold share
certificates, you must return the certificates, along with
the letter and any required additional documentation.
------------------------------------------------------------
A check will be mailed to the name(s) and address in which
the account is registered, or otherwise according to your
instructions.
- --------------------------------------------------------------------------------
Systematic If your investment in all of the Morgan Stanley Dean Witter
Withdrawal Plan Family of Funds has a total market value of at least
$10,000, you may elect to withdraw amounts of $25 or more,
or in any whole percentage of a Fund's balance (provided the
amount is at least $25), on a monthly, quarterly,
semi-annual or annual basis, from any Fund with a balance of
$1,000. Each time you add a Fund to the plan, you must meet
the plan requirements.
------------------------------------------------------------
ICON Amounts withdrawn are subject to any applicable CDSC. A CDSC
may be waived under certain circumstances. See the Class B
waiver categories listed in the "Share Class Arrangements"
section of this PROSPECTUS.
------------------------------------------------------------
To sign up for the Systematic Withdrawal Plan, contact your
Morgan Stanley Dean Witter Financial Advisor or other
authorized financial representative, or call (800) 869-NEWS.
You may terminate or suspend your plan at any time. Please
remember that withdrawals from the plan are sales of shares,
not Fund "distributions," and ultimately may exhaust your
account balance. The Fund may terminate or revise the plan
at any time.
- --------------------------------------------------------------------------------
</TABLE>
11
<PAGE>
PAYMENT FOR SOLD SHARES. After we receive your complete instructions to sell
as described above, a check will be mailed to you within seven days,
although we will attempt to make payment within one business day. Payment
may also be sent to your brokerage account.
Payment may be postponed or the right to sell your shares suspended under
unusual circumstances. If you request to sell shares that were recently
purchased by check, payment of the sale proceeds may be delayed for the
minimum time needed to verify that the check has been honored (not more than
fifteen days from the time we receive the check).
TAX CONSIDERATIONS. Normally, your sale of Fund shares is subject to federal
and state income tax. You should review the "Tax Consequences" section of
this PROSPECTUS and consult your own tax professional about the tax
consequences of a sale.
REINSTATEMENT PRIVILEGE. If you sell Fund shares and have not previously
exercised the reinstatement privilege, you may, within 35 days after the
date of sale, invest any portion of the proceeds in the same Class of Fund
shares at their net asset value and receive a pro rata credit for any CDSC
paid in connection with the sale.
INVOLUNTARY SALES. The Fund reserves the right, on sixty days' notice, to
sell the shares of any shareholder (other than shares held in an IRA or
403(b) Custodial Account) whose shares, due to sales by the shareholder,
have a value below $100, or in the case of an account opened through
EASYINVEST -SM-, if after 12 months the shareholder has invested less than
$1,000 in the account.
However, before the Fund sells your shares in this manner, we will notify
you and allow you sixty days to make an additional investment in an amount
that will increase the value of your account to at least the required amount
before the sale is processed. No CDSC will be imposed on any involuntary
sale.
MARGIN ACCOUNTS. Certain restrictions may apply to Fund shares pledged in
margin accounts with Dean Witter Reynolds or another authorized
broker-dealer of Fund shares. If you hold Fund shares in this manner, please
contact your Morgan Stanley Dean Witter Financial Advisor or other
authorized financial representative for more details.
ICON DISTRIBUTIONS
- --------------------------------------------------------------------------------
The Fund passes substantially all of its earnings from income and capital
gains along to its investors as "distributions." The Fund earns income from
stocks and interest from fixed-income investments. These amounts are passed
along to Fund shareholders as "income dividend distributions." The Fund
realizes capital gains whenever it sells securities for a higher price than
it paid for them. These amounts may be passed along as "capital gain
distributions."
The Fund declares income dividends separately for each Class. Distributions
paid on Class A and Class D shares usually will be higher than for Class B
and Class C
12
<PAGE>
(SIDEBAR)
TARGETED DIVIDENDS-SM-
YOU MAY SELECT TO HAVE YOUR FUND DISTRIBUTIONS AUTOMATICALLY INVESTED IN OTHER
CLASSES OF FUND SHARES OR CLASSES OF ANOTHER MORGAN STANLEY DEAN WITTER FUND
THAT YOU OWN. CONTACT YOUR MORGAN STANLEY DEAN WITTER FINANCIAL ADVISOR FOR
FURTHER INFORMATION ABOUT THIS SERVICE.
(END SIDEBAR)
because distribution fees that Class B and Class C pay are higher. Normally,
income dividends and capital gains are distributed annually in December. The
Fund, however, may retain and reinvest any long-term capital gains. The Fund may
at times make payments from sources other than income or capital gains that
represent a return of a portion of your investment.
Distributions are reinvested automatically in additional shares of the same
Class and automatically credited to your account, unless you request in writing
that all distributions be paid in cash. If you elect the cash option, the Fund
will mail a check to you no later than seven business days after the
distribution is declared. No interest will accrue on uncashed checks. If you
wish to change how your distributions are paid, your request should be received
by the Fund's transfer agent, Morgan Stanley Dean Witter Trust FSB, at least
five business days prior to the record date of the distributions.
ICON TAX CONSEQUENCES
- --------------------------------------------------------------------------------
As with any investment, you should consider how your Fund investment will be
taxed. The tax information in this PROSPECTUS is provided as general
information. You should consult your own tax professional about the tax
consequences of an investment in the Fund.
Unless your investment in the Fund is through a tax-deferred retirement
account, such as a 401(k) plan or IRA, you need to be aware of the possible
tax consequences when:
- The Fund makes distributions; and
- You sell Fund shares, including an exchange to another Morgan Stanley Dean
Witter Fund.
TAXES ON DISTRIBUTIONS. Your distributions are normally subject to federal
and state income tax when they are paid, whether you take them in cash or
reinvest them in Fund shares. A distribution also may be subject to local
income tax. Any income dividend distributions and any short-term capital
gain distributions are taxable to you as ordinary income. Any long-term
capital gain distributions are taxable as long-term capital gains, no matter
how long you have owned shares in the Fund.
Every January, you will be sent a statement (IRS Form 1099-DIV) showing the
taxable distributions paid to you in the previous year. The statement
provides full information on your dividends and capital gains for tax
purposes.
TAXES ON SALES. Your sale of Fund shares normally is subject to federal and
state income tax and may result in a taxable gain or loss to you. A sale
also may be subject to local income tax. Your exchange of Fund shares for
shares of another Morgan Stanley Dean Witter Fund is treated for tax
purposes like a sale of your original shares and a purchase of your new
shares. Thus, the exchange may, like a sale, result in a taxable gain or
loss to you and will give you a new tax basis for your new shares.
13
<PAGE>
When you open your Fund account, you should provide your social security or
tax identification number on your investment application. By providing this
information, you will avoid being subject to a federal backup withholding
tax of 31% on taxable distributions and redemption proceeds. Any withheld
amount would be sent to the IRS as an advance tax payment.
ICON SHARE CLASS ARRANGEMENTS
- --------------------------------------------------------------------------------
The Fund offers several Classes of shares having different distribution
arrangements designed to provide you with different purchase options
according to your investment needs. Your Morgan Stanley Dean Witter
Financial Advisor or other authorized financial representative can help you
decide which Class may be appropriate for you.
The general public is offered three Classes: Class A shares, Class B shares
and Class C shares, which differ principally in terms of sales charges and
ongoing expenses. A fourth Class, Class D shares, is offered only to a
limited category of investors. Shares that you acquire through reinvested
distributions will not be subject to any front-end sales charge or CDSC --
contingent deferred sales charge. Sales personnel may receive different
compensation for selling each Class of shares. The sales charges applicable
to each Class provide for the distribution financing of shares of that
Class.
The chart below compares the sales charge and annual 12b-1 fee applicable to
each Class:
<TABLE>
<CAPTION>
CLASS SALES CHARGE ANNUAL 12b-1 FEE
<S> <C> <C>
- ------------------------------------------------------------------
A Maximum 5.25% initial sales charge
reduced for purchase of $25,000 or more;
shares sold without an initial sales
charge are generally subject to a 1.0%
CDSC during the first year 0.25%
- ------------------------------------------------------------------
B Maximum 5.0% CDSC during the first year
decreasing to 0% after six years 1.0%
- ------------------------------------------------------------------
C 1.0% CDSC during the first year 1.0%
- ------------------------------------------------------------------
D None None
- ------------------------------------------------------------------
</TABLE>
CLASS A SHARES Class A shares are sold at net asset value plus an
initial sales charge of up to 5.25%. The initial sales charge is reduced
for purchases of $25,000 or more according to the schedule below.
Investments of $1 million or more are not subject to an initial sales
charge, but are generally subject to a contingent deferred sales charge, or
CDSC, of 1.0% on sales made within one year after the last day of the month
of purchase. The CDSC will be assessed in the same manner and with the same
CDSC waivers as with Class B shares. Class A shares are also subject to a
distribution (12b-1) fee of up to 0.25% of the average daily net assets of
the Class.
14
<PAGE>
(SIDEBAR)
FRONT-END SALES
CHARGE OR FSC
AN INITIAL SALES CHARGE YOU PAY WHEN PURCHASING CLASS A SHARES THAT IS BASED ON
A PERCENTAGE OF THE OFFERING PRICE. THE PERCENTAGE DECLINES BASED UPON THE
DOLLAR VALUE OF CLASS A SHARES YOU PURCHASE. WE OFFER THREE WAYS TO REDUCE YOUR
CLASS A SALES CHARGES - THE COMBINED PURCHASE PRIVILEGE, RIGHT OF ACCUMULATION
AND LETTER OF INTENT.
(END SIDEBAR)
The offering price of Class A shares includes a sales charge (expressed as a
percentage of the offering price) on a single transaction as shown in the
following table:
<TABLE>
<CAPTION>
FRONT-END SALES CHARGE
---------------------------------------------
AMOUNT OF PERCENTAGE OF PUBLIC APPROXIMATE PERCENTAGE
SINGLE TRANSACTION OFFERING PRICE OF AMOUNT INVESTED
<S> <C> <C>
- ---------------------------------------------------------------------------------------
Less than $25,000 5.25% 5.54%
- ---------------------------------------------------------------------------------------
$25,000 but less than $50,000 4.75% 4.99%
- ---------------------------------------------------------------------------------------
$50,000 but less than $100,000 4.00% 4.17%
- ---------------------------------------------------------------------------------------
$100,000 but less than $250,000 3.00% 3.09%
- ---------------------------------------------------------------------------------------
$250,000 but less than $1 million 2.00% 2.04%
- ---------------------------------------------------------------------------------------
$1 million and over 0.00% 0.00%
- ---------------------------------------------------------------------------------------
</TABLE>
The reduced sales charge schedule is applicable to purchases of Class A
shares in a single transaction by:
- A single account (including an individual, trust or fiduciary account).
- Family member accounts (limited to husband, wife and children under the
age of 21).
- Pension, profit sharing or other employee benefit plans of companies and
their affiliates.
- Tax-exempt organizations.
- Groups organized for a purpose other than to buy mutual fund shares.
COMBINED PURCHASE PRIVILEGE. You also will have the benefit of reduced sales
charges by combining purchases of Class A shares of the Fund in a single
transaction with purchases of Class A shares of other Multi-Class Funds and
shares of FSC Funds.
RIGHT OF ACCUMULATION. You also may benefit from a reduction of sales
charges if the cumulative net asset value of Class A shares of the Fund
purchased in a single transaction, together with shares of other Funds you
currently own which were previously purchased at a price including a
front-end sales charge (including shares acquired through reinvestment of
distributions), amounts to $25,000 or more. Also, if you have a cumulative
net asset value of all your Class A and Class D shares equal to at least $5
million (or $25 million for certain employee benefit plans), you are
eligible to purchase Class D shares of any Fund subject to the Fund's
minimum initial investment requirement.
You must notify your Morgan Stanley Dean Witter Financial Advisor or other
authorized financial representative (or Morgan Stanley Dean Witter Trust FSB
if you purchase directly through the Fund), at the time a purchase order is
placed, that the purchase qualifies for the reduced charge under the Right
of Accumulation. Similar notification must be made in writing when an order
is placed by mail. The reduced sales charge will not be granted if: (i)
notification is not furnished at the time of the
15
<PAGE>
order; or (ii) a review of the records of Dean Witter Reynolds or other
authorized dealer of Fund shares or the Fund's transfer agent does not
confirm your represented holdings.
LETTER OF INTENT. The schedule of reduced sales charges for larger purchases
also will be available to you if you enter into a written "letter of
intent." A letter of intent provides for the purchase of Class A shares of
the Fund or other Multi-Class Funds or shares of FSC Funds within a
thirteen-month period. The initial purchase under a letter of intent must be
at least 5% of the stated investment goal. To determine the applicable sales
charge reduction, you may also include: (1) the cost of shares of other
Morgan Stanley Dean Witter Funds which were previously purchased at a price
including a front-end sales charge during the 90-day period prior to the
distributor receiving the letter of intent, and (2) the cost of shares of
other Funds you currently own acquired in exchange for shares of Funds
purchased during that period at a price including a front-end sales charge.
You can obtain a letter of intent by contacting your Morgan Stanley Dean
Witter Financial Advisor or other authorized financial representative, or by
calling (800) 869-NEWS. If you do not achieve the stated investment goal
within the thirteen-month period, you are required to pay the difference
between the sales charges otherwise applicable and sales charges actually
paid.
OTHER FRONT-END SALES CHARGE WAIVERS. In addition to investments of $1
million or more, your purchase of Class A shares is not subject to a
front-end sales charge (or a CDSC upon sale) if your account qualifies under
one of the following categories:
- A trust for which Morgan Stanley Dean Witter Trust FSB provides
discretionary trustee services.
- Persons participating in a fee-based investment program (subject to all of
its terms and conditions, including mandatory sale or transfer
restrictions on termination) approved by the Fund's distributor pursuant
to which they pay an asset-based fee for investment advisory,
administrative and/or brokerage services.
- Employer-sponsored employee benefit plans, whether or not qualified under
the Internal Revenue Code, for which Morgan Stanley Dean Witter Trust FSB
serves as trustee or Dean Witter Reynolds' Retirement Plan Services serves
as recordkeeper under a written Recordkeeping Services Agreement ("MSDW
Eligible Plans") which have at least 200 eligible employees.
- An MSDW Eligible Plan whose Class B shares have converted to Class A
shares, regardless of the plan's asset size or number of eligible
employees.
- A client of a Morgan Stanley Dean Witter Financial Advisor who joined us
from another investment firm within six months prior to the date of
purchase of Fund shares, and you used the proceeds from the sale of shares
of a proprietary mutual fund of that Financial Advisor's previous firm
that imposed either a front-end or deferred sales charge to purchase Class
A shares, provided that: (1) you sold the shares not more than 60 days
prior to the purchase of Fund shares, and (2) the sale proceeds were
maintained in the interim in cash or a money market fund.
16
<PAGE>
(SIDEBAR)
CONTINGENT DEFERRED SALES CHARGE OR CDSC
A FEE YOU PAY WHEN YOU SELL SHARES OF CERTAIN MORGAN STANLEY DEAN WITTER FUNDS
PURCHASED WITHOUT AN INITIAL SALES CHARGE. THIS FEE DECLINES THE LONGER YOU HOLD
YOUR SHARES AS SET FORTH IN THE TABLE.
(END SIDEBAR)
CLASS B SHARES Class B shares are offered at net asset value with no
initial sales charge but are subject to a contingent deferred sales
charge, or CDSC, as set forth in the table below. For the purpose of
calculating the CDSC, shares are deemed to have been purchased on the
last day of the month during which they were purchased.
<TABLE>
<CAPTION>
CDSC AS A PERCENTAGE
YEAR SINCE PURCHASE PAYMENT MADE OF AMOUNT REDEEMED
<S> <C>
- ----------------------------------------------------------------
First 5.0%
- ----------------------------------------------------------------
Second 4.0%
- ----------------------------------------------------------------
Third 3.0%
- ----------------------------------------------------------------
Fourth 2.0%
- ----------------------------------------------------------------
Fifth 2.0%
- ----------------------------------------------------------------
Sixth 1.0%
- ----------------------------------------------------------------
Seventh and thereafter None
- ----------------------------------------------------------------
</TABLE>
Each time you place an order to sell or exchange shares, shares with no CDSC
will be sold or exchanged first, then shares with the lowest CDSC will be
sold or exchanged next. For any shares subject to a CDSC, the CDSC will be
assessed on an amount equal to the lesser of the current market value or the
cost of the shares being sold.
CDSC WAIVERS. A CDSC, if otherwise applicable, will be waived in the case
of:
- Sales of shares held at the time you die or become disabled (within the
definition in Section 72(m)(7) of the Internal Revenue Code which relates
to the ability to engage in gainful employment), if the shares are: (i)
registered either in your name (not a trust) or in the names of you and
your spouse as joint tenants with right of survivorship; or (ii) held in a
qualified corporate or self-employed retirement plan, IRA or 403(b)
Custodial Account, provided in either case that the sale is requested
within one year of your death or initial determination of disability.
- Sales in connection with the following retirement plan "distributions":
(i) lump-sum or other distributions from a qualified corporate or
self-employed retirement plan following retirement (or, in the case of a
"key employee" of a "top heavy" plan, following attainment of age 59 1/2);
(ii) distributions from an IRA or 403(b) Custodial Account following
attainment of age 59 1/2; or (iii) a tax-free return of an excess IRA
contribution (a "distribution" does not include a direct transfer of IRA,
403(b) Custodial Account or retirement plan assets to a successor
custodian or trustee).
- Sales of shares held for you as a participant in an MSDW Eligible Plan.
- Sales of shares in connection with the Systematic Withdrawal Plan of up to
12% annually of the value of each Fund from which plan sales are made. The
percentage is determined on the date you establish the Systematic
Withdrawal Plan and based on the next calculated share price. You may have
this CDSC waiver applied in amounts up to 1% per month, 3% per quarter, 6%
semi-annually or 12%
17
<PAGE>
annually. Shares with no CDSC will be sold first, followed by those with
the lowest CDSC. As such, the waiver benefit will be reduced by the amount
of your shares that are not subject to a CDSC. If you suspend your
participation in the plan, you may later resume plan payments without
requiring a new determination of the account value for the 12% CDSC
waiver.
All waivers will be granted only following the Distributor receiving
confirmation of your entitlement. If you believe you are eligible for a CDSC
waiver, please contact your Financial Advisor or call (800) 869-NEWS.
DISTRIBUTION FEE. Class B shares are subject to an annual 12b-1 fee of 1.0%
of the lesser of: (a) the average daily aggregate gross purchases by all
shareholders of the Fund's Class B shares since the inception of the Fund
(not including reinvestments of dividends or capital gains distributions),
less the average daily aggregate net asset value of the Fund's Class B
shares sold by all shareholders since the Fund's inception upon which a CDSC
has been imposed or waived, or (b) the average daily net assets of Class B.
CONVERSION FEATURE. After ten (10) years, Class B shares will convert
automatically to Class A shares of the Fund with no initial sales charge.
The ten year period runs from the last day of the month in which the shares
were purchased, or in the case of Class B shares acquired through an
exchange, from the last day of the month in which the original Class B
shares were purchased; the shares will convert to Class A shares based on
their relative net asset values in the month following the ten year period.
At the same time, an equal proportion of Class B shares acquired through
automatically reinvested distributions will convert to Class A shares on the
same basis. (Class B shares held before May 1, 1997, however, will convert
to Class A shares in May 2007.)
In the case of Class B shares held in an MSDW Eligible Plan, the plan is
treated as a single investor and all Class B shares will convert to Class A
shares on the conversion date of the Class B shares of a Morgan Stanley Dean
Witter Fund purchased by that plan.
Currently, the Class B share conversion is not a taxable event; the
conversion feature may be cancelled if it is deemed a taxable event in the
future by the Internal Revenue Service.
If you exchange your Class B shares for shares of a Money Market Fund,
No-Load Fund or Short-Term U.S. Treasury Trust, the holding period for
conversion is frozen as of the last day of the month of the exchange and
resumes on the last day of the month you exchange back into Class B shares.
EXCHANGING SHARES SUBJECT TO A CDSC. There are special considerations when
you exchange Fund shares that are subject to a CDSC. When determining the
length of time you held the shares and the corresponding CDSC rate, any
period (starting at the end of the month) during which you held shares of a
fund that does NOT charge a CDSC WILL NOT BE COUNTED. Thus, in effect the
"holding period" for purposes of calculating the CDSC is frozen upon
exchanging into a fund that does not charge a CDSC.
18
<PAGE>
For example, if you held Class B shares of the Fund for one year, exchanged
to Class B of another Morgan Stanley Dean Witter Multi-Class Fund for
another year, then sold your shares, a CDSC rate of 4% would be imposed on
the shares based on a two year holding period -- one year for each Fund.
However, if you had exchanged the shares of the Fund for a Money Market Fund
(which does not charge a CDSC) instead of the Multi-Class Fund, then sold
your shares, a CDSC rate of 5% would be imposed on the shares based on a one
year holding period. The one year in the Money Market Fund would not be
counted. Nevertheless, if shares subject to a CDSC are exchanged for a Fund
that does not charge a CDSC, you will receive a credit when you sell the
shares equal to the distribution (12b-1) fees, if any, you paid on those
shares while in that Fund up to the amount of any applicable CDSC.
In addition, shares that are exchanged into or from a Morgan Stanley Dean
Witter Fund subject to a higher CDSC rate will be subject to the higher
rate, even if the shares are re-exchanged into a Fund with a lower CDSC
rate.
CLASS C SHARES Class C shares are sold at net asset value with no
initial sales charge but are subject to a CDSC of 1.0% on sales made
within one year after the last day of the month of purchase. The CDSC
will be assessed in the same manner and with the same CDSC waivers as
with Class B shares.
DISTRIBUTION FEE. Class C shares are subject to an annual distribution
(12b-1) fee of 1.0% of the average daily net assets of that Class. The Class
C shares' distribution fee may cause that Class to have higher expenses and
pay lower dividends than Class A or Class D shares. Unlike Class B shares,
Class C shares have no conversion feature and, accordingly, an investor that
purchases Class C shares may be subject to distribution (12b-1) fees
applicable to Class C shares for an indefinite period.
CLASS D SHARES Class D shares are offered without any sales charge on
purchases or sales and without any distribution (12b-1) fee. Class D
shares are offered only to investors meeting an initial investment
minimum of $5 million ($25 million for MSDW Eligible Plans) and the
following investor categories:
- Investors participating in the Investment Manager's mutual fund asset
allocation program (subject to all of its terms and conditions, including
mandatory sale or transfer restrictions on termination) pursuant to which
they pay an asset-based fee.
- Persons participating in a fee-based investment program (subject to all of
its terms and conditions, including mandatory sale or transfer
restrictions on termination) approved by the Fund's distributor pursuant
to which they pay an asset-based fee for investment advisory,
administrative and/or brokerage services.
- Employee benefit plans maintained by Morgan Stanley Dean Witter & Co. or
any of its subsidiaries for the benefit of certain employees of Morgan
Stanley Dean Witter & Co. and its subsidiaries.
- Certain unit investment trusts sponsored by Dean Witter Reynolds.
19
<PAGE>
- Certain other open-end investment companies whose shares are distributed
by the Fund's distributor.
- Investors who were shareholders of the Dean Witter Retirement Series on
September 11, 1998 for additional purchases for their former Dean Witter
Retirement Series accounts.
MEETING CLASS D ELIGIBILITY MINIMUMS. To meet the $5 million ($25 million
for MSDW Eligible Plans) initial investment to qualify to purchase Class D
shares you may combine: (1) purchases in a single transaction of Class D
shares of the Fund and other Morgan Stanley Dean Witter Multi-Class Funds
and/or (2) previous purchases of Class A and Class D shares of Multi-Class
Funds and shares of FSC Funds you currently own, along with shares of Morgan
Stanley Dean Witter Funds you currently own that you acquired in exchange
for those shares.
NO SALES CHARGES FOR REINVESTED CASH DISTRIBUTIONS If you receive a
cash payment representing an income dividend or capital gain and you
reinvest that amount in the applicable Class of shares by returning the
check within 30 days of the payment date, the purchased shares would not
be subject to an initial sales charge or CDSC.
PLAN OF DISTRIBUTION (RULE 12B-1 FEES) The Fund has adopted a Plan of
Distribution in accordance with Rule 12b-1 under the Investment Company
Act of 1940 with respect to the distribution of Class A, Class B and
Class C shares. The Plan allows the Fund to pay distribution fees for
the sale and distribution of these shares. It also allows the Fund to pay
for services to shareholders of Class A, Class B and Class C shares. Because
these fees are paid out of the Fund's assets on an ongoing basis, over time
these fees will increase the cost of your investment in these Classes and
may cost you more than paying other types of sales charges.
20
<PAGE>
FINANCIAL HIGHLIGHTS
The financial highlights table is intended to help you understand the
Fund's financial performance for the past 5 fiscal years of the Fund.
Certain information reflects financial results for a single Fund share.
The total returns in the table represent the rate an investor would have
earned or lost on an investment in the Fund (assuming reinvestment of
all dividends and distributions).
This information has been audited by PricewaterhouseCoopers LLP, whose
report, along with the Fund's financial statements, is included in the
annual report, which is available upon request.
<TABLE>
<CAPTION>
CLASS B SHARES
- ----------------------------------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED OCTOBER 31 1998++ 1997*++ 1996 1995 1994
<S> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------
SELECTED PER SHARE DATA:
- ----------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 6.85 $ 11.14 $ 9.77 $ 11.45 $ 10.80
- ----------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment loss (0.09) (0.10) (0.10) (0.08) (0.06)
Net realized and unrealized gain (loss) (1.75) (3.35) 1.66 (1.38) 0.73
------- ------- -------- -------- -----------
Total income (loss) from investment operations (1.84) (3.45) 1.56 (1.46) 0.67
- ----------------------------------------------------------------------------------------------------------------------------
LESS DIVIDENDS AND DISTRIBUTIONS FROM:
Net investment income -- (0.13) -- -- --
Net realized gain -- (0.71) (0.19) (0.22) (0.02)
------- ------- -------- -------- -----------
Total dividends and distributions -- (0.84) (0.19) (0.22) (0.02)
- ----------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 5.01 $ 6.85 $ 11.14 $ 9.77 $ 11.45
- ----------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN+ (26.86)% (33.29)% 15.93% (12.78)% 6.18%
- ----------------------------------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS:
- ----------------------------------------------------------------------------------------------------------------------------
Expenses 2.78%(1) 2.36% 2.27% 2.29% 2.28%
- ----------------------------------------------------------------------------------------------------------------------------
Net investment loss (1.55)%(1) (1.13)% (0.84)% (0.70)% (0.87)%
- ----------------------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA:
- ----------------------------------------------------------------------------------------------------------------------------
Net assets, end of period, in thousands $30,005 $37,964 $ 60,841 $ 55,448 $ 73,444
- ----------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 36% 53% 46% 23% 46%
- ----------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Prior to July 28, 1997, the Fund issued one class of shares. All shares of the
Fund held prior to that date have been designated Class B shares.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charges. Calculated based on the net
asset value as of the last business day of the period.
(1) Reflects overall Fund ratios for investment income and non-class specific
expenses.
21
<PAGE>
<TABLE>
<CAPTION>
CLASS A SHARES++
- ------------------------------------------------------------------------------------------------------------------
FOR THE YEAR ENDED FOR THE PERIOD JULY 28, 1997*
SELECTED PER SHARE DATA: OCTOBER 31, 1998 THROUGH OCTOBER 31, 1997
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 6.86 $ 7.95
- ------------------------------------------------------------------------------------------------------------------
LOSS FROM INVESTMENT OPERATIONS:
Net investment loss (0.05) --
Net realized and unrealized loss (1.76) (1.09)
------- -------
Total loss from investment operations (1.81) (1.09)
- ------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 5.05 $ 6.86
- ------------------------------------------------------------------------------------------------------------------
TOTAL RETURN+ (26.38)% (13.71)%(1)
- ------------------------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS:
- ------------------------------------------------------------------------------------------------------------------
Expenses 2.01%(3) 1.61%(2)
- ------------------------------------------------------------------------------------------------------------------
Net investment loss (0.78)%(3) (0.08)%(2)
- ------------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA:
- ------------------------------------------------------------------------------------------------------------------
Net assets, end of period, in thousands $ 91 $ 32
- ------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 36% 53%
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
CLASS C SHARES++
- ------------------------------------------------------------------------------------------------------------------
SELECTED PER SHARE DATA:
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 6.84 $ 7.95
- ------------------------------------------------------------------------------------------------------------------
LOSS FROM INVESTMENT OPERATIONS:
Net investment loss (0.09) (0.02)
Net realized and unrealized loss (1.74) (1.09)
------- -------
Total loss from investment operations (1.83) (1.11)
- ------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 5.01 $ 6.84
- ------------------------------------------------------------------------------------------------------------------
TOTAL RETURN+ (26.75)% (13.96)%(1)
- ------------------------------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS:
- ------------------------------------------------------------------------------------------------------------------
Expenses 2.78%(3) 2.37%(2)
- ------------------------------------------------------------------------------------------------------------------
Net investment loss (1.55)%(3) (0.79)%(2)
- ------------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA:
- ------------------------------------------------------------------------------------------------------------------
Net assets, end of period, in thousands $ 1,046 $ 475
- ------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 36% 53%
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
* The date shares were first issued.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Does not reflect the deduction of sales charges. Calculated based on the net
asset value as of the last business day of the period.
(1) Not annualized.
(2) Annualized.
(3) Reflects overall Fund ratios for investment income and non-class specific
expenses.
22
<PAGE>
<TABLE>
<CAPTION>
CLASS D SHARES++
- ---------------------------------------------------------------------------------------------
FOR THE YEAR ENDED FOR THE PERIOD JULY 28, 1997*
SELECTED PER SHARE DATA: OCTOBER 31, 1998 THROUGH OCTOBER 31, 1997
<S> <C> <C>
- ---------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 6.86 $ 7.95
- ---------------------------------------------------------------------------------------------
INCOME (LOSS) FROM INVESTMENT
OPERATIONS:
Net investment income 0.02 --
Net realized and unrealized loss (1.85) (1.09)
------- -------
Total loss from investment operations (1.83) (1.09)
- ---------------------------------------------------------------------------------------------
Net asset value, end of period $ 5.03 $ 6.86
- ---------------------------------------------------------------------------------------------
TOTAL RETURN+ (26.68)% (13.71)%(1)
- ---------------------------------------------------------------------------------------------
RATIOS TO AVERAGE NET ASSETS:
- ---------------------------------------------------------------------------------------------
Expenses 1.78%(3) 1.35%(2)
- ---------------------------------------------------------------------------------------------
Net investment income (loss) (0.55)%(3) 0.22%(2)
- ---------------------------------------------------------------------------------------------
SUPPLEMENTAL DATA:
- ---------------------------------------------------------------------------------------------
Net assets, end of period, in
thousands $ 327 $ 9
- ---------------------------------------------------------------------------------------------
Portfolio turnover rate 36% 53%
- ---------------------------------------------------------------------------------------------
</TABLE>
* The date shares were first issued.
++ The per share amounts were computed using an average number of shares
outstanding during the period.
+ Calculated based on the net asset value as of the last business day of the
period.
(1) Not annualized.
(2) Annualized.
(3) Reflects overall Fund ratios for investment income and non-class specific
expenses.
23
<PAGE>
NOTES
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24
<PAGE>
MORGAN STANLEY DEAN WITTER
FAMILY OF FUNDS
The Morgan Stanley Dean Witter Family of Funds offers
investors a wide range of investment choices. Come on
in and meet the family!
- --------------------------------------------------------------------------------
GROWTH FUNDS
- ---------------------------------
GROWTH FUNDS
Aggressive Equity Fund
American Value Fund
Capital Growth Securities
Developing Growth Securities
Equity Fund
Growth Fund
Market Leader Trust
Mid-Cap Growth Fund
Special Value Fund
Value Fund
THEME FUNDS
Financial Services Trust
Health Sciences Trust
Information Fund
Natural Resource Development Securities
Precious Metals and Minerals Trust
GLOBAL/INTERNATIONAL FUNDS
Competitive Edge Fund - "Best Ideas" Portfolio
European Growth Fund
Fund of Funds - International Portfolio
Global Dividend Growth Securities
International SmallCap Fund
Japan Fund
Pacific Growth Fund
- --------------------------------------------------------------------------------
GROWTH AND INCOME FUNDS
- ---------------------------------
Balanced Growth Fund
Balanced Income Fund
Convertible Securities Trust
Dividend Growth Securities
Fund of Funds - Domestic Portfolio
Income Builder Fund
Mid-Cap Dividend Growth Securities
<PAGE>
S&P 500 Index Fund
S&P 500 Select Fund
Strategist Fund
Value-Added Market Series/Equity Portfolio
THEME FUNDS
Global Utilities Fund
Utilities Fund
- --------------------------------------------------------------------------------
INCOME FUNDS
- ---------------------------------
GOVERNMENT INCOME FUNDS
Federal Securities Trust
Short-Term U.S. Treasury Trust
U.S. Government Securities Trust
DIVERSIFIED INCOME FUNDS
Diversified Income Trust
CORPORATE INCOME FUNDS
High Yield Securities
Intermediate Income Securities
Short-Term Bond Fund (NL)
GLOBAL INCOME FUNDS
World Wide Income Trust
TAX-FREE INCOME FUNDS
California Tax-Free Income Fund
Hawaii Municipal Trust (FSC)
Limited Term Municipal Trust (NL)
Multi-State Municipal Series Trust (FSC)
New York Tax-Free Income Fund
Tax-Exempt Securities Trust
- --------------------------------------------------------------------------------
MONEY MARKET FUNDS
- ---------------------------------
TAXABLE MONEY MARKET FUNDS
Liquid Asset Fund (MM)
U.S. Government Money Market Trust (MM)
<PAGE>
TAX-FREE MONEY MARKET FUNDS
California Tax-Free Daily Income Trust (MM)
N.Y. Municipal Money Market Trust (MM)
Tax-Free Daily Income Trust (MM)
There may be Funds created after this PROSPECTUS was published. Please consult
the inside front cover of a new Fund's PROSPECTUS for its designation, e.g.,
Multi-Class Fund or Money Market Fund.
Unless otherwise noted, each listed Morgan Stanley Dean Witter Fund, except for
Short-Term U.S. Treasury Trust, is a Multi-Class Fund. A Multi-Class Fund is a
mutual fund offering multiple Classes of shares. The other types of Funds are:
NL - No-Load (Mutual) Fund; MM - Money Market Fund; FSC - A mutual fund sold
with a front-end sales charge and a distribution (12b-1) fee.
<PAGE>
PROSPECTUS - FEBRUARY 22, 1999
Additional information about the Fund's investments is available in the Fund's
ANNUAL AND SEMI-ANNUAL REPORTS TO SHAREHOLDERS. In the Fund's ANNUAL REPORT, you
will find a discussion of the market conditions and investment strategies that
significantly affected the Fund's performance during its last fiscal year. The
Fund's STATEMENT OF ADDITIONAL INFORMATION also provides additional information
about the Fund. The STATEMENT OF ADDITIONAL INFORMATION is incorporated herein
by reference (legally is part of this PROSPECTUS). For a free copy of any of
these documents, to request other information about the Fund, or to make
shareholder inquiries, please call:
(800) 869-NEWS
You also may obtain information about the Fund by calling your Morgan Stanley
Dean Witter Financial Advisor or by visiting our Internet site at:
WWW.DEANWITTER.COM/FUNDS
Information about the Fund (including the STATEMENT OF ADDITIONAL INFORMATION)
can be viewed and copied at the Securities and Exchange Commission's Public
Reference Room in Washington, DC. Information about the Reference Room's
operations may be obtained by calling the SEC at (800) SEC-0330. Reports and
other information about the Fund are available on the SEC's Internet site
(www.sec.gov), and copies of this information may be obtained, upon payment of a
duplicating fee, by writing the Public Reference Section of the SEC, Washington,
DC 20549-6009.
Morgan Stanley Dean Witter
PRECIOUS METALS AND
MINERALS TRUST
[BACK COVER PHOTO]
A MUTUAL FUND
THAT SEEKS LONG-TERM
CAPITAL APPRECIATION
TICKER SYMBOLS:
CLASS A: METAX CLASS C: METCX
- -------------------- --------------------
CLASS B: METBX CLASS D: METDX
- -------------------- --------------------
(MORGAN STANLEY DEAN WITTER
PRECIOUS METALS AND MINERALS
TRUST; INVESTMENT COMPANY ACT
FILE NO. 811-5988)
