<PAGE>
Schedule 14A Information required in proxy statement.
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the
Securities and Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Preliminary Additional Materials
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.149-11(c) or
Section 240.14a-12
Term Trust 2002
- -------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
LouAnne McInnis
- -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(j)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
Set forth the amount on which the filing fee is calculated and state how
it was determined.
4) Proposed maximum aggregate value of transaction:
5) Fee previously paid:
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the Form
or Schedule and the date of its filing.
1) Amount Previously paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
PRELIMINARY PROXY -- TO BE FILED WITH THE SECURITIES
AND EXCHANGE COMMISSION ONLY
TCW/DW TERM TRUST 2002
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 18, 1997
The Annual Meeting of Shareholders of TCW/DW TERM TRUST 2002 (the
"Trust"), an unincorporated business trust organized under the laws of the
Commonwealth of Massachusetts, will be held in Conference Room A,
Forty-Fourth Floor, Two World Trade Center, New York, New York 10048, on
December 18, 1997, at [ ] a.m., New York City time, for the following
purposes:
1. To elect four (4) Trustees to serve until the year 2000 Annual
Meeting or until their successors shall have been elected and qualified;
2. To approve or disapprove the continuance of the currently effective
Investment Advisory Agreement between the Trust and TCW Funds Management,
Inc.;
3. To ratify or reject the selection of Price Waterhouse LLP as the
Trust's independent accountants for the fiscal year ending September 30,
1998;
4. Shareholder proposal to amend the Trust's Declaration of Trust to
require each Trustee, within thirty days of election, to become a
shareholder of the Trust (Note: The Trustees unanimously recommend a vote
AGAINST this proposal); and
5. To transact such other business as may properly come before the
Meeting or any adjournment thereof.
Shareholders of record as of the close of business on October 24, 1997 are
entitled to notice of and to vote at the Meeting. If you cannot be present in
person, your management would greatly appreciate your filling in, signing and
returning the enclosed proxy promptly in the envelope provided for that
purpose.
In the event that the necessary quorum to transact business or the vote
required to approve or reject any proposal is not obtained at the Meeting,
the persons named as proxies may propose one or more adjournments of the
Meeting for a total of not more than 60 days in the aggregate to permit
further solicitation of proxies. Any such adjournment will require the
affirmative vote of the holders of a majority of the Trust's shares present
in person or by proxy at the Meeting. The persons named as proxies will vote
in favor of such adjournment those proxies which they are entitled to vote in
favor of the proposal to approve continuance of the Investment Advisory
Agreement and will vote against any such adjournment those proxies required
to be voted against that proposal.
BARRY FINK,
Secretary
November , 1997
New York, New York
- -----------------------------------------------------------------------------
IMPORTANT
YOU CAN HELP THE TRUST AVOID THE NECESSITY AND EXPENSE OF SENDING FOLLOW-UP
LETTERS TO ENSURE A QUORUM BY PROMPTLY RETURNING THE ENCLOSED PROXY. IF YOU
ARE UNABLE TO BE PRESENT IN PERSON, PLEASE FILL IN, SIGN AND RETURN THE
ENCLOSED PROXY IN ORDER THAT THE NECESSARY QUORUM MAY BE REPRESENTED AT THE
MEETING. THE ENCLOSED ENVELOPE REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES.
- -----------------------------------------------------------------------------
<PAGE>
TCW/DW TERM TRUST 2002
TWO WORLD TRADE CENTER, NEW YORK, NEW YORK 10048
---------------
PROXY STATEMENT
---------------
ANNUAL MEETING OF SHAREHOLDERS
DECEMBER 18, 1997
This statement is furnished in connection with the solicitation of proxies
by the Board of Trustees (the "Board" or "Trustees") of TCW/DW TERM TRUST
2002 (the "Trust"), for use at the Annual Meeting of Shareholders of the
Trust to be held on December 18, 1997, (the "Meeting"), and at any
adjournments thereof.
If the enclosed form of proxy is properly executed and returned in time to
be voted at the Meeting, the proxies named therein will vote the shares
represented by the proxy in accordance with the instructions marked thereon.
Unmarked proxies will be voted for each of the nominees for election as
Trustee and in favor of Proposals 2 and 3 and against Proposal 4. A proxy may
be revoked at any time prior to its exercise by any of the following: written
notice of revocation to the Secretary of the Trust, execution and delivery of
a later dated proxy to the Secretary of the Trust (if returned and received
in time to be voted), or attendance and voting at the Meeting. Attendance at
the Meeting will not in and of itself revoke a proxy.
Holders of shares of the Trust ("Shareholders") as of the close of
business on October 24, 1997, the record date for the determination of
Shareholders entitled to notice of and to vote at the Meeting, are entitled
to one vote for each share held and a fractional vote for a fractional share.
On October 24, 1997 there were [ ] shares of beneficial interest of
the Trust outstanding, all with $0.01 par value. No person was known to own
as much as 5% of the outstanding shares of the Trust on that date. The
percentage ownership of shares of the Trust changes from time to time
depending on purchases and sales by Shareholders and the total number of
shares outstanding. The first mailing of this proxy statement is expected to
be made on or about November , 1997.
The cost of soliciting proxies for the Meeting, consisting principally of
printing and mailing expenses, will be borne by the Trust. The solicitation
of proxies will be by mail, which may be supplemented by solicitation by
mail, telephone or otherwise through Trustees, officers of the Trust,
officers and regular employees of Dean Witter Services Company Inc. ("DWSC"
or the "Manager") or its parent company Dean Witter InterCapital Inc.
("InterCapital"), Dean Witter Trust FSB ("DWT") and/or Dean Witter Reynolds
Inc. ("DWR") without special compensation therefor. In addition, the Trust
may employ William F. Doring and Co. as proxy solicitor, the cost of which is
not expected to exceed $3,000 and will be borne by the Trust.
William F. Doring & Co. and DWT may call Shareholders to ask if they would
be willing to have their votes recorded by telephone. The telephone voting
procedure is designed to authenticate Shareholders' identities, to allow
Shareholders to authorize the voting of their shares in accordance with their
instructions and to confirm that their instructions have been recorded
properly. No recommendation will be made as to how a Shareholder should vote
on any Proposal other than to refer to the recommendations of the Board. The
Trust has been advised by counsel that these procedures are consistent with
the requirements of applicable law. Shareholders voting by telephone will be
asked for their social security number or other identifying information and
will be given an opportunity to authorize proxies to vote their shares in
accordance with their instruction. To ensure that the Shareholders'
instructions have been recorded correctly they will receive a confirmation of
their
2
<PAGE>
instructions in the mail. A special toll-free number will be available in
case the information contained in the confirmation is incorrect. Although a
Shareholder's vote may be taken by telephone, each Shareholder will receive a
copy of this Proxy Statement and may vote by mail using the enclosed proxy
card. With respect to the solicitation of a telephonic vote by William F.
Doring & Co., additional expenses would include $7.00 per telephone vote
transacted, $3.00 per outbound telephone contact and costs relating to
obtaining Shareholders' telephone numbers which would be borne by the Trust.
(1) ELECTION OF TRUSTEES
The number of Trustees has currently been fixed by the Trustees, pursuant
to the Trust's Declaration of Trust, at nine. There are currently nine
Trustees, four of whom (John R. Haire, Dr. Manuel H. Johnson, John L.
Schroeder and Marc I. Stern) are standing for election at this Meeting to
serve until the year 2000 Annual Meeting in accordance with the Trust's
Declaration of Trust.
Five of the current nine Trustees (John C. Argue, John R. Haire, Manuel H.
Johnson, Michael E. Nugent and John L. Schroeder) are "Independent Trustees,"
that is, Trustees who are not "interested persons" of the Trust, as that term
is defined in the Investment Company Act of 1940, as amended (the "1940
Act"). The nominees for election as Trustees of the Trust have been proposed
by the Trustees now serving or, in the case of the nominees for positions as
Independent Trustees, by the Independent Trustees now serving. All of the
Trustees have been elected previously by the Shareholders of the Trust.
The nominees of the Board of Trustees for election as Trustee are listed
below. It is the intention of the persons named in the enclosed form of proxy
to vote the shares represented by them for the election of these nominees:
John R. Haire, Dr. Manuel H. Johnson, John L. Schroeder and Marc I. Stern.
Should any of the nominees become unable or unwilling to accept nomination or
election, the persons named in the proxy will exercise their voting power in
favor of such person or persons as the Board may recommend. All of the
nominees have consented to being named in this proxy statement and to serve
if elected. The Trust knows of no reason why said nominees would be unable or
unwilling to accept nomination or election. The election of each Trustee
requires the approval of a majority of the shares of the Trust represented
and entitled to vote at the Meeting.
Pursuant to the provisions of the Trust's Declaration of Trust, the
Trustees are divided into three separate classes, each class having a term of
three years. The term of office of one of each of the three classes will
expire each year.
The Board of Trustees previously determined that any nominee for election
as Trustee will stand for election as Trustee in one of the three classes of
Trustee as follows: Class I--Messrs. Haire, Johnson, Schroeder and Stern;
Class II--Messrs. DeMartini and Larkin; and Class III--Messrs. Argue,
Fiumefreddo and Nugent. Each nominee will, if elected, serve a term of up to
approximately three years running for the period assigned to that class and
terminating at the date of the Annual Meeting of Shareholders so designated
by the Board of Trustees, or any adjournment thereof. As a consequence of
this method of election, the replacement of a majority of the Board could be
delayed for up to two years. In accordance with the above, the Class I
Trustees are standing for election and will serve until the year 2000 Annual
Meeting or until their successors shall have been elected and qualified.
The following information regarding each of the nominees for election as
Trustee and each of the other members of the Board includes his principal
occupations and employment for at least the last five years, his age, shares
of the Trust owned, if any, as of October 24, 1997 (shown in parentheses),
positions with the Trust, and directorships (or trusteeships) in other
companies which file periodic reports with the Securities and Exchange
Commission, including the 14 investment companies, including the Trust, for
which TCW Funds Management,
3
<PAGE>
Inc. serves as investment adviser (the "Investment Adviser" or the
"Adviser"), and InterCapital's wholly-owned subsidiary, DWSC, serves as
manager (referred to herein as the "TCW/DW Funds"), and the 85 investment
companies for which InterCapital serves as investment manager or investment
adviser (referred to herein as the "Dean Witter Funds").
The nominees for Trustee to be elected at this Meeting are:
JOHN R. HAIRE, Trustee since September, 1992; age 72; Chairman of the
Audit Committee and Chairman of the Committee of the Independent Directors or
Trustees and Director or Trustee of the Dean Witter Funds; Trustee and
Chairman of the Audit Committee and Chairman of the Committee of the
Independent Trustees of the TCW/DW Funds; formerly President, Council for Aid
to Education (1978-1989) and Chairman and Chief Executive Officer of Anchor
Corporation, an investment adviser (1964-1978); Director of Washington
National Corporation (insurance).
DR. MANUEL H. JOHNSON, Trustee since September, 1992; age 48; Senior
Partner, Johnson Smick International, Inc., a consulting firm; Co-Chairman
and a founder of the Group of Seven Council (G7C), an international economic
commission; Director or Trustee of the Dean Witter Funds; Trustee of the
TCW/DW Funds; Director of NASDAQ (since June, 1995); Director of Greenwich
Capital Markets, Inc. (broker-dealer); Trustee of the Financial Accounting
Foundation (oversight organization for the Financial Accounting Standards
Board); formerly Vice Chairman of the Board of Governors of the Federal
Reserve System (1986-1990) and Assistant Secretary of the U.S. Treasury
(1982-1986).
JOHN L. SCHROEDER, Trustee since April, 1995; age 67; Director or Trustee
of the Dean Witter Funds; Trustee of the TCW/DW Funds; Director of Citizens
Utilities Company; formerly Executive Vice President and Chief Investment
Officer of The Home Insurance Company (August, 1991-September, 1995).
MARC I. STERN,* Trustee since April, 1995; age 53; Vice President of the
Trust; President and Director, The TCW Group Inc.; President and Director of
the Adviser; Vice Chairman and Director of TCW Asset Management Company;
Executive Vice President and Director of Trust Company of the West; Chairman
and Director of the TCW Galileo Funds, Inc.; Trustee of the TCW/DW Funds;
Chairman of TCW Americas Development, Inc.; Chairman of TCW Asia, Limited
(since January, 1993); Chairman of TCW London International, Limited (since
March, 1993); formerly President of SunAmerica, Inc. (financial services
company) (1988-1990); Director of Qualcomm, Incorporated (wireless
communications); Director or Trustee of various not-for-profit organizations.
The Trustees who are not standing for reelection at this Meeting are:
JOHN C. ARGUE, Trustee since September, 1992; age 65; Of Counsel, Argue
Pearson Harbison & Myers (law firm); Director, Avery Dennison Corporation
(manufacturer of self-adhesive products and office supplies) and CalMat
Company (producer of aggregates, asphalt and ready mixed concrete); Chairman,
Rose Hills Memorial Foundation (charitable foundation); advisory director,
LAACO Ltd. (owner and operator of private clubs and real estate); director or
trustee of various business and not-for-profit corporations; Director, Coast
Savings Financial Inc. and Coast Federal Bank (a subsidiary of Coast Savings
Financial Inc.); Director, TCW Galileo Funds, Inc.; Trustee of the TCW/DW
Funds.
RICHARD M. DeMARTINI,* Trustee since January, 1993; age 45; President and
Chief Operating Officer of Dean Witter Capital, a division of DWR; Executive
Vice President of DWSC, Dean Witter Distributors Inc. ("Distributors"),
InterCapital and DWR; Trustee of the TCW/DW Funds; formerly Vice Chairman of
the Board of the National Association of Securities Dealers, Inc.; formerly
Chairman of the Board of Directors of the NASDAQ Market, Inc.; formerly
President and Chief Operating Officer of the Consumer Banking Division of
Dean Witter, Discover & Co. ("DWDC").
4
<PAGE>
CHARLES A. FIUMEFREDDO,* Trustee since August, 1992; age 64; Chairman,
Chief Executive Officer and Director of InterCapital, DWSC and Distributors;
Executive Vice President and Director of DWR; Chairman, Director or Trustee,
President and Chief Executive Officer of the Dean Witter Funds; Chairman,
Chief Executive Officer and Trustee of the TCW/DW Funds; Chairman and
Director of DWT; Director and/or officer of various Morgan Stanley, Dean
Witter, Discover & Co. ("MSDWD") subsidiaries; formerly Executive Vice
President and Director of DWDC (until February, 1993).
THOMAS E. LARKIN, Jr.,* Trustee since September, 1992; age 58; Executive
Vice President and Director, The TCW Group, Inc.; President and Director of
Trust Company of the West; Vice Chairman and Director of TCW Asset Management
Company; Chairman of the Adviser; Member of the Board of Trustees of the
University of Notre Dame; Director of Orthopaedic Hospital of Los Angeles;
President and Director of TCW Galileo Funds, Inc.; Senior Vice President of
TCW Convertible Securities Fund, Inc.; President and Trustee of the TCW/DW
Funds.
MICHAEL E. NUGENT, Trustee since September, 1992; age 61; General Partner,
Triumph Capital, L.P., Director or Trustee of the Dean Witter Funds; Trustee
of the TCW/DW Funds; formerly Vice President, Bankers Trust Company and BT
Capital Corporation (1984-1988); Director of various business organizations.
The executive officers of the Trust are: Barry Fink, Vice President,
Secretary and General Counsel; Robert M. Scanlan, Vice President; Mitchell M.
Merin, Vice President; Robert S. Giambrone, Vice President; Philip A. Barach,
Vice President, Jeffrey E. Gundlach, Vice President; Frederick H. Horton,
Vice President; and Thomas F. Caloia, Treasurer. In addition, Marilyn K.
Cranney, Lou Anne D. McInnis, Ruth Rossi, Carsten Otto, Frank Bruttomesso and
Todd Lebo serve as Assistant Secretaries. Mr. Fink is 42 years old and is
currently Senior Vice President (since March, 1997), Secretary and General
Counsel (since February, 1997) of InterCapital and DWSC and Assistant
Secretary of DWR (since August, 1996); he is also Senior Vice President
(since March, 1997), Assistant Secretary and Assistant General Counsel (since
February, 1997) of Distributors. He was previously First Vice President,
Assistant Secretary and Assistant General Counsel of InterCapital. He has
been an employee of InterCapital or DWR, a broker-dealer affiliate of
InterCapital, for over five years. Mr. Scanlan is 61 years old and is
currently President and Chief Operating Officer of InterCapital (since March,
1993) and DWSC; he is also Executive Vice President of Distributors and
Executive Vice President and Director of DWT. He was previously Executive
Vice President of InterCapital (November, 1990-March, 1993). Mr. Merin is 44
years old and is currently President and Chief Strategic Officer of
InterCapital and DWSC, Executive Vice President of Distributors and DWT and
Director of DWT, Executive Vice President, Chief Administrative Officer and
Director of DWR and Director of SPS Transaction Services, Inc. and various
other MSDWD subsidiaries. Mr. Giambrone is 43 years old and is currently
Senior Vice President of InterCapital, DWSC, Distributors and DWT (since
August, 1995) and a Director of DWT (since April, 1996). He was formerly a
partner of KPMG Peat Marwick, LLP. Mr. Barach is 45 years old and is
currently a Managing Director of Trust Company of the West, TCW Asset
Management Company and TCW Funds Management, Inc. Mr. Gundlach is 37 years
old and is currently a Managing Director of Trust Company of the West, TCW
Asset Management Company and TCW Funds Management, Inc. Both Messrs. Barach
and Gundlach have been associated with The TCW Group, Inc. and/or its
subsidiaries for over five years. Mr. Horton is 39 years old and is currently
a Managing Director of Trust Company of the West, TCW Asset Management
Company and TCW Funds Management, Inc. He was previously a senior portfolio
manager for Dewey Square Investors (June 1991-September 1993). Mr. Caloia is
51 years old and is currently First Vice President and Assistant Treasurer of
InterCapital and DWSC. He has been an employee of InterCapital or DWR for
over five years.
- ------------
* Messrs. DeMartini, Fiumefreddo, Larkin and Stern may be deemed "interested
persons" of the Trust and/or its Investment Adviser as defined in Section
2(a)(19) of the 1940 Act, due to their affiliation with the Investment
Adviser or Manager and/or their affiliated companies.
5
<PAGE>
THE BOARD OF TRUSTEES, THE INDEPENDENT TRUSTEES, AND THE COMMITTEES
The Board of Trustees consists of nine (9) trustees. These same
individuals also serve as trustees for all of the TCW/DW Funds. As of the
date of this Proxy Statement, there are a total of 14 TCW/DW Funds. As of
September 30, 1997, the TCW/DW Funds had total net assets of approximately
$4.6 billion and approximately a quarter of a million shareholders.
Five Trustees (56% of the total number) have no affiliation or business
connection with TCW Funds Management, Inc. or Dean Witter Services Company
Inc. or any of their affiliated persons and do not own any stock or other
securities issued by MSDWD or TCW, the parent companies of Dean Witter
Services Company Inc. and TCW Funds Management, Inc., respectively. These are
the "disinterested" or "independent" Trustees. The other four Trustees (the
"management Trustees") are affiliated with either Dean Witter Services
Company Inc. or TCW. Four of the five independent Trustees are also
Independent Trustees of the Dean Witter Funds.
Law and regulation establish both general guidelines and specific duties
for the Independent Trustees. The TCW/DW Funds seek as Independent Trustees
individuals of distinction and experience in business and finance, government
service or academia; these are people whose advice and counsel are in demand
by others and for whom there is often competition. To accept a position on
the Funds' Boards, such individuals may reject other attractive assignments
because the Funds make substantial demands on their time. Indeed, by serving
on the Funds' Boards, certain Trustees who would otherwise be qualified and
in demand to serve on bank boards would be prohibited by law from doing so.
All of the Independent Trustees serve as members of the Audit Committee
and the Committee of the Independent Trustees. Three of them also serve as
members of the Derivatives Committee. The Committees hold some meetings at
the offices of the Manager or Adviser and some outside those offices.
Management Trustees or officers do not attend these meetings unless they are
invited for purposes of furnishing information or making a report. There are
no nominating or compensation committees of the Trustees.
The Committee of the Independent Trustees is charged with recommending to
the full Board approval of management, advisory and administration contracts,
Rule 12b-1 plans and distribution and underwriting agreements; continually
reviewing Fund performance; checking on the pricing of portfolio securities,
brokerage commissions, transfer agent costs and performance, and trading
among Funds in the same complex; and approving fidelity bond and related
insurance coverage and allocations, as well as other matters that arise from
time to time. The Independent Trustees are required to select and nominate
individuals to fill any Independent Trustee vacancy on the Board of any Fund
that has a Rule 12b-1 plan of distribution. Each of the open-end TCW/DW Funds
has such a plan.
The Audit Committee is charged with recommending to the full Board the
engagement or discharge of the Fund's independent accountants; directing
investigations into matters within the scope of the independent accountants'
duties, including the power to retain outside specialists; reviewing with the
independent accountants the audit plan and results of the auditing
engagement; approving professional services provided by the independent
accountants and other accounting firms prior to the performance of such
services; reviewing the independence of the independent accountants;
considering the range of audit and non-audit fees; reviewing the adequacy of
the Fund's system of internal controls; and preparing and submitting
Committee meeting minutes to the full Board.
Finally, the Board of each Fund has formed a Derivatives Committee to
establish parameters for and oversee the activities of the Fund with respect
to derivative investments, if any, made by the Fund.
For the fiscal year ended September 30, 1997, the Board of Trustees of the
Trust held meetings, and the Audit Committee, the Committee of the
Independent Trustees and the Derivatives Committee of the Trust
6
<PAGE>
held , and meetings, respectively. No Trustee attended fewer than 75%
of the meetings of the Board of Trustees, the Audit Committee, the Committee
of the Independent Trustees or the Derivatives Committee held while he served
in such positions.
DUTIES OF CHAIRMAN OF COMMITTEE OF THE INDEPENDENT TRUSTEES AND AUDIT
COMMITTEE
On July 1, 1996, Mr. Haire became Chairman of the Committee of the
Independent Trustees and the Audit Committee of the TCW/DW Funds. The
Chairman of the Committees maintains an office in the Funds' headquarters in
New York. He is responsible for keeping abreast of regulatory and industry
developments and the Funds' operations and management. He screens and/or
prepares written materials and identifies critical issues for the Independent
Trustees to consider, develops agendas for Committee meetings, determines the
type and amount of information that the Committees will need to form a
judgment on various issues, and arranges to have that information furnished
to Committee members. He also arranges for the services of independent
experts and consults with them in advance of meetings to help refine reports
and to focus on critical issues. Members of the Committees believe that the
person who serves as Chairman of both Committees and guides their efforts is
pivotal to the effective functioning of the Committees.
The Chairman of the Committees also maintains continuous contact with the
Funds' management, with independent counsel to the Independent Trustees and
with the Funds' independent auditors. He arranges for a series of special
meetings involving the annual review of investment advisory, management and
other operating contracts of the Funds and, on behalf of the Committees,
conducts negotiations with the Investment Adviser and the Manager and other
service providers. In effect, the Chairman of the Committees serves as a
combination of chief executive and support staff of the Independent Trustees.
The Chairman of the Committee of the Independent Trustees and the Audit
Committee is not employed by any other organization and devotes his time
primarily to the services he performs as Committee Chairman and Independent
Trustee of the TCW/DW Funds and as Chairman of the Committee of the
Independent Trustees and the Audit Committee and Independent Director or
Trustee of the Dean Witter Funds. The current Committee Chairman has had more
than 35 years experience as a senior executive in the investment company
industry.
ADVANTAGES OF HAVING SAME INDIVIDUALS AS INDEPENDENT TRUSTEES FOR ALL TCW/DW
FUNDS
The Independent Trustees and the Funds' management believe that having the
same Independent Trustees for each of the TCW/DW Funds avoids the duplication
of effort that would arise from having different groups of individuals
serving as Independent Trustees for each of the Funds or even of sub-groups
of Funds. They believe that having the same individuals serve as Independent
Trustees of all the Funds tends to increase their knowledge and expertise
regarding matters which affect the Fund complex generally and enhances their
ability to negotiate on behalf of each Fund with the Fund's service
providers. This arrangement also precludes the possibility of separate groups
of Independent Trustees arriving at conflicting decisions regarding
operations and management of the Funds and avoids the cost and confusion that
would likely ensue. Finally, having the same Independent Trustees serve on
all Fund Boards enhances the ability of each Fund to obtain, at modest cost
to each separate Fund, the services of Independent Trustees, and a Chairman
of their Committees, of the caliber, experience and business acumen of the
individuals who serve as Independent Trustees of the TCW/DW Funds.
SHARE OWNERSHIP BY TRUSTEES
The Trustees have adopted a policy pursuant to which each Trustee and/or
his or her spouse is required to invest at least $25,000 in any of the Funds
in the TCW/DW Funds complex (and, if applicable, in the Dean
7
<PAGE>
Witter Funds complex) on whose boards the Trustee serves. In addition, the
policy contemplates that the Trustees will, over time, increase their
aggregate investment in the Funds above the $25,000 minimum requirement. The
Trustees may allocate their investments among specific Funds in any manner
they determine is appropriate based on their individual investment
objectives. As of the date of this proxy statement, each Trustee is in
compliance with the policy. Any future Trustee will be given a one year
period following his or her election within which to comply with the
foregoing. As of September 30, 1997, the total value of the investments by
the Trustees and/or their spouses in shares of the TCW/DW Funds (and, if
applicable, the Dean Witter Funds) was approximately $ million.
As of October 24, 1997, the aggregate number of shares of beneficial
interest of the Trust owned by the Trust's officers and Trustees as a group
was less than 1 percent of the Trust's shares of beneficial interest
outstanding.
COMPENSATION OF INDEPENDENT TRUSTEES
The Trust pays each Independent Trustee an annual fee of $2,225 plus a per
meeting fee of $200 for meetings of the Board of Trustees or committees of
the Board of Trustees attended by the Trustee (the Trust pays the Chairman of
the Audit Committee an annual fee of $750 and pays the Chairman of the
Committee of the Independent Trustees an additional annual fee of $1,200). If
a Board meeting and a Committee meeting, or more than one Committee meeting,
take place on a single day, the Trustees are paid a single meeting fee by
each Trust. The Trust also reimburses such Trustees for travel and other
out-of-pocket expenses incurred by them in connection with attending such
meetings. Trustees and officers of the Trust who are or have been employed by
the Manager or the Adviser or an affiliated company of either receive no
compensation or expense reimbursement from the Trust. The Trustees of the
TCW/DW Funds do not have retirement or deferred compensation plans.
The following table illustrates the compensation paid to the Trust's
Independent Trustees by the Trust for the fiscal year ended September 30,
1997.
TRUST COMPENSATION
<TABLE>
<CAPTION>
AGGREGATE
COMPENSATION
NAME OF INDEPENDENT TRUSTEE FROM THE TRUST
- ------------------------------- ------------------
<S> <C>
John C. Argue................... $
John R. Haire...................
Dr. Manuel H. Johnson...........
Michael E. Nugent...............
John L. Schroeder...............
</TABLE>
The following table illustrates the compensation paid to the Trust's
Independent Trustees for the calendar year ended December 31, 1996 for
services to the 14 TCW/DW Funds and, in the case of Messrs. Haire, Johnson,
Nugent and Schroeder, the 82 Dean Witter Funds that were in operation at
December 31, 1996, and, in the case of Mr. Argue, TCW Galileo Funds, Inc.
With respect to Messrs. Haire, Johnson, Nugent and Schroeder, the Dean Witter
Funds are included solely because of a limited exchange privilege between
various TCW/DW Funds and five Dean Witter Money Market Funds. With respect to
Mr. Argue, TCW Galileo Funds, Inc. is included solely because the Trust's
Adviser, TCW Funds Management, Inc., also serves as Adviser to that
investment company.
8
<PAGE>
CASH COMPENSATION FROM FUND GROUPS
<TABLE>
<CAPTION>
FOR SERVICE AS
FOR SERVICES AS CHAIRMAN OF
CHAIRMAN OF COMMITTEES OF
COMMITTEES OF INDEPENDENT TOTAL CASH
INDEPENDENT DIRECTORS/ COMPENSATION
FOR SERVICE TRUSTEES TRUSTEES FOR SERVICES TO
FOR SERVICE AS AS DIRECTOR OR AND AUDIT AND AUDIT 82 DEAN WITTER
TRUSTEE AND TRUSTEE AND FOR SERVICE AS COMMITTEES COMMITTEES FUNDS, 14
COMMITTEE MEMBER COMMITTEE MEMBER DIRECTOR OF OF 14 OF 82 TCW/DW FUNDS
NAME OF INDEPENDENT OF 14 TCW/DW OF 82 DEAN WITTER TCW GALILEO TCW/DW DEAN WITTER AND TCW GALILEO
TRUSTEE FUNDS FUNDS FUNDS, INC. FUNDS FUNDS FUNDS, INC.
- -------------------------- ---------------- ----------------- -------------- --------------- -------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
John C. Argue.............. $66,483 -- $39,000 -- -- $105,483
John R. Haire.............. 64,283 $106,400 -- $12,187 $195,450 378,320
Dr. Manuel H. Johnson ..... 66,483 137,100 -- -- -- 203,583
Michael E. Nugent.......... 64,283 138,850 -- -- -- 203,133
John L. Schroeder.......... 69,083 137,150 -- -- -- 206,233
</TABLE>
As of the date of this Proxy Statement, 57 of the Dean Witter Funds have
adopted a retirement program under which an Independent Trustee who retires
after serving for at least five years (or such lesser period as may be
determined by the Board) as an Independent Director or Trustee of any Dean
Witter Fund that has adopted the retirement program (each such Fund referred
to as an "Adopting Fund" and each such Trustee referred to as an "Eligible
Trustee") is entitled to retirement payments upon reaching the eligible
retirement age (normally, after attaining age 72). Annual payments are based
upon length of service. Currently, upon retirement, each Eligible Trustee is
entitled to receive from the Adopting Fund, commencing as of his or her
retirement date and continuing for the remainder of his or her life, an
annual retirement benefit (the "Regular Benefit") equal to 25.0% of his or
her Eligible Compensation plus 0.4166666% of such Eligible Compensation for
each full month of service as an Independent Director or Trustee of any
Adopting Fund in excess of five years up to a maximum of 50.0% after ten
years of service. The foregoing percentages may be changed by the Board. (1)
"Eligible Compensation" is one-fifth of the total compensation earned by such
Eligible Trustee for service to the Adopting Fund in the five year period
prior to the date of the Eligible Trustee's retirement. Benefits under the
retirement program are not secured or funded by the Adopting Funds.
The following table illustrates the retirement benefits accrued to Messrs.
Haire, Johnson, Nugent and Schroeder by the 57 Dean Witter Funds for the year
ended December 31, 1996, and the estimated retirement benefits for Messrs.
Haire, Johnson, Nugent and Schroeder, to commence upon their retirement, from
the 57 Dean Witter Funds as of December 31, 1996.
RETIREMENT BENEFITS FROM ALL DEAN WITTER FUNDS
<TABLE>
<CAPTION>
ESTIMATED
RETIREMENT ANNUAL BENEFITS
ESTIMATED ESTIMATED BENEFITS ACCRUED UPON RETIREMENT
CREDITED YEARS OF PERCENTAGE OF AS EXPENSES FROM ALL
NAME OF INDEPENDENT SERVICE AT RETIREMENT ELIGIBLE BY ALL ADOPTING
TRUSTEE (MAXIMUM 10) COMPENSATION ADOPTING FUNDS FUNDS(2)
- -------------------------- --------------------- --------------- ---------------- ---------------
<S> <C> <C> <C> <C>
John R. Haire ............. 10 50.0% $46,952 $129,550
Dr. Manuel H. Johnson .... 10 50.0 10,926 51,325
Michael E. Nugent ......... 10 50.0 19,217 51,325
John L. Schroeder.......... 8 41.7 38,700 42,771
</TABLE>
- ------------
(1) An Eligible Trustee may elect alternate payments of his or her retirement
benefits based upon the combined life expectancy of such Eligible Trustee and
his or her spouse on the date of such Eligible Trustee's retirement. The
amount estimated to be payable under this method, through the remainder of
the later of the lives of such Eligible Trustee and spouse, will be the
actuarial equivalent of the Regular Benefit. In addition, the Eligible
Trustee may elect that the surviving spouse's periodic payment of benefits
will be equal to either 50% or 100% of the previous periodic amount, an
election that, respectively, increases or decreases the previous periodic
amount so that the resulting payments will be the actuarial equivalent of the
Regular Benefit.
(2) Based on current levels of compensation. Amount of annual benefits also
varies depending on the Trustee's elections described in Footnote (1) above.
9
<PAGE>
(2) APPROVAL OR DISAPPROVAL OF CURRENTLY EFFECTIVE
MANAGEMENT AGREEMENT
The Trust's investments are managed by TCW Funds Management, Inc.
(referred to herein as the "Investment Adviser"), pursuant to an Investment
Advisory Agreement dated November 20, 1992 (referred to herein as the
"Advisory Agreement").
THE ADVISORY AGREEMENT
The Advisory Agreement was initially approved by the Board of Trustees of
the Trust, including all of the Independent Trustees, at a meeting held on
September 24, 1992, and was approved by DWR, the then sole shareholder of the
Trust, on November 19, 1992. The Trust's Shareholders last approved the
continuance of the Advisory Agreement at their Annual Meeting on December 27,
1996. In the event Shareholders do not approve continuance of the Advisory
Agreement by the required majority vote at the forthcoming meeting or an
adjournment thereof, the Board of Trustees of the Trust will take such action
as it deems to be in the best interest of the Trust and its Shareholders,
which may include calling a special meeting of shareholders to vote on a new
investment advisory agreement or continuance of the present Advisory
Agreement until the next Annual Meeting of Shareholders.
In considering whether or not to approve the Advisory Agreement, the Board
of Trustees reviewed the terms of the agreement and considered all materials
and information deemed relevant to its determination. Among other things, the
Board considered the nature and scope of services to be rendered, the quality
of the Adviser's services and personnel, and the appropriateness of the fees
that are paid under the Advisory Agreement. Based upon its review, the Board
of Trustees, including all of the Independent Trustees, determined that the
approval of the Advisory Agreement was in the best interests of the Trust and
its Shareholders.
The favorable vote of a majority of the outstanding voting securities of
the Trust is required for the approval of the Advisory Agreement. Such a
majority is defined in the 1940 Act as the lesser of (a) 67% or more of the
shares present at the Meeting, if the holders of more than 50% of the
outstanding shares of the Trust are present or represented by proxy, or (b)
more than 50% of the outstanding shares.
THE INDEPENDENT TRUSTEES UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS
APPROVE THE ADVISORY AGREEMENT.
THE ADVISORY AGREEMENT
The Advisory Agreement provides that the Investment Adviser shall
continuously invest the assets of the Trust in a manner consistent with the
Trust's investment objectives. The Investment Adviser obtains and evaluates
such information and advice relating to the economy, securities markets and
specific securities as it considers necessary or useful to continuously
manage the assets of the Trust in a manner consistent with its investment
objectives and policies. In addition, the Investment Adviser pays the
compensation of all personnel, including officers of the Trust, who are its
employees. The Investment Adviser has authority to place orders for the
purchase and sale of portfolio securities on behalf of the Trust without
prior approval of its Trustees. The Trustees review the investment portfolio
at their regular meetings.
Under the Advisory Agreement, the Trust is obligated to bear all of the
costs and expenses of its operation, except those specifically assumed by the
Investment Adviser or the Manager, including, without limitation: charges and
expenses of any registrar, custodian or depository appointed by the Trust for
the safekeeping of its cash, portfolio securities or commodities and other
property, and any stock transfer or dividend agent or agents
10
<PAGE>
appointed by the Trust; brokers' commissions chargeable to the Trust in
connection with portfolio securities transactions to which the Trust is a
party; all taxes, including securities or commodities issuance and transfer
taxes, and fees payable by the Trust to Federal, state or other governmental
agencies; costs and expenses of engraving or printing of certificates
representing shares of the Trust; all costs and expenses in connection with
registration and maintenance of registration of the Trust and of its shares
with the Securities and Exchange Commission and various states and other
jurisdictions (including filing fees and legal fees and disbursements of
counsel); the costs and expense of preparation, printing, including
typesetting, and distributing prospectuses for such purposes; all expenses of
shareholders' and Trustees' meetings and of preparing, printing and mailing
proxy statements and reports to shareholders; fees and travel expenses of
Trustees or members of any advisory board or committee who are not employees
of the Trust's Manager or Investment Adviser or any of their corporate
affiliates; all expenses incident to the payment of any dividend or
distribution program; charges and expenses of any outside pricing services;
charges and expenses of legal counsel, including counsel to the Independent
Trustees of the Trust, and independent accountants in connection with any
matter relating to the Trust (not including compensation or expenses of
attorneys employed by the Trust's Manager or Investment Adviser); membership
dues of industry associations; interest payable on Trust borrowings; fees and
expenses incident to the listing of the Trust's shares on any stock exchange;
postage; insurance premiums on property or personnel (including officers and
Trustees) of the Trust which inure to its benefit; extraordinary expenses
(including, but not limited to, legal claims, liabilities, litigation costs
and any indemnification related thereto); and all other charges and costs of
the Trust's operations unless otherwise explicitly provided in the Advisory
Agreement.
The Advisory Agreement had an initial term ending April 30, 1994 and
provides that, after this period, it will continue in effect from year to
year thereafter provided such continuance is approved at least annually by
vote of a majority, as defined in the Act, of the outstanding voting
securities of the Trust or by the Trustees of the Trust, and, in either
event, by the vote cast in person by a majority of the Trustees who are not
parties to the Advisory Agreement or "interested persons" of any such party
(as defined in the 1940 Act) at a meeting called for the purpose of voting on
such approval. The Advisory Agreement's most recent continuation, until April
30, 1998 was approved by the Trustees, including a majority of Independent
Trustees at a meeting held on April 24, 1997, called for the purpose of
approving the Advisory Agreement.
The Advisory Agreement also provides that it may be terminated at any time
by the Investment Adviser, the Trustees of the Trust or by a vote of a
majority of the outstanding voting securities of the Trust, in each instance
without the payment of any penalty, on thirty days' notice and will
automatically terminate upon any assignment (as defined in the 1940 Act).
In return for its investment services and the expenses which the
Investment Adviser assumes under the Advisory Agreement, the Trust pays the
Investment Adviser compensation which is computed weekly and payable monthly
and which is determined by applying the annual rate of 0.26% to the Trust's
average weekly net assets. Pursuant to the Advisory Agreement, the Trust
accrued to the Investment Adviser total compensation of $1,104,216 during the
fiscal year ended September 30, 1997. The net assets of the Trust totalled
$429,328,274 at September 30, 1997.
INVESTMENT ADVISER
TCW Funds Management, Inc. (the "Investment Adviser") is the Trust's
investment adviser. The Investment Adviser, a California corporation, is a
wholly-owned subsidiary of The TCW Group, Inc. (formerly TCW Management
Company) ("The TCW Group"), a Nevada corporation, whose direct and indirect
subsidiaries, including Trust Company of the West and TCW Asset Management
Company, provide a variety of trust, investment management and investment
advisory services. As of September 30, 1997, the Investment
11
<PAGE>
Adviser and its affiliates had approximately $ billion under management or
committed to management. The Investment Adviser is headquartered at 865 South
Figueroa Street, Suite 1800, Los Angeles, California 90017.
The Principal Executive Officers and Directors of the Investment Adviser,
and their principal occupations, are:
Thomas E. Larkin, Jr., Chairman, Marc I. Stern, President and Alvin R.
Albe, Jr., Executive Vice President. Mr. Robert A. Day may be deemed to be a
control person of the Adviser by virtue of the aggregate ownership of Mr.
Robert Day and his family of more than 25% of the outstanding voting stock of
The TCW Group, Inc. The principal occupations of Messrs. Larkin and Stern are
described in the preceding tables. Mr. Albe is an Executive Vice President of
The TCW Group, Inc.
The business address of the foregoing Directors and Executive Officers is
865 South Figueroa Street, Suite 1800, Los Angeles, California 90017.
The Appendix lists the investment companies for which the Adviser provides
investment advisory or sub-advisory services and which have similar
investment objectives to that of the Trust, and sets forth the fees payable
to the Adviser by such investment companies, including the Trust, and their
net assets as of October 24, 1997.
MANAGER
Dean Witter Services Company Inc. ("DWSC") is the Trust's Manager. DWSC,
which maintains its offices at Two World Trade Center, New York, New York
10048, is a wholly-owned subsidiary of Dean Witter InterCapital Inc.
("InterCapital"). InterCapital maintains its offices at Two World Trade
Center, New York, New York 10048. InterCapital, which was incorporated in
July, 1992, is a wholly-owned subsidiary of MSDWD, a preeminent global
financial services firm that maintains leading market positions in each of
its three primary businesses--securities, asset management and credit
services.
As the Trust's Manager, DWSC receives from the Trust compensation which is
computed weekly and payable monthly and which is determined by applying the
annual rate of 0.39% to the Trust's weekly net assets. For the fiscal year
ended September 30, 1997, the Trust accrued to DWSC, pursuant to a Management
Agreement, total compensation of $1,656,325.
The Principal Executive Officer and Directors of InterCapital, and their
principal occupations, are:
Philip J. Purcell, Chairman of the Board of Directors and Chief Executive
Officer of MSDWD and DWR and Director of InterCapital, DWSC and Distributors;
Richard M. DeMartini, President and Chief Operating Officer of Dean Witter
Capital and Director of DWR, Distributors, InterCapital, DWSC and DWT; James
F. Higgins, President and Chief Operating Officer of Dean Witter Financial
and Director of DWR, Distributors, InterCapital, DWSC and DWT; Charles A.
Fiumefreddo, Executive Vice President and Director of DWR and Chairman of the
Board of Directors and Chief Executive Officer of InterCapital, DWSC and
Distributors and Chairman of the Board of Directors and Director of DWT;
Christine A. Edwards, Executive Vice President, Chief Legal Officer and
Secretary of MSDWD; Executive Vice President, Secretary, General Counsel and
Director of DWR, Executive Vice President, Secretary, Chief Legal Officer and
Director of Distributors, and Director of InterCapital and DWSC; and Thomas
C. Schneider, Executive Vice President and Chief Strategic and Administrative
Officer of MSDWD and Executive Vice President, Chief Financial Officer and
Director of DWR, Distributors, InterCapital and DWSC.
The business address of Mr. Purcell, Ms. Edwards and Mr. Schneider is 1585
Broadway, New York, New York 10036; the business address of the Executive
Officer and other Directors is Two World Trade Center, New York, New York
10048.
12
<PAGE>
InterCapital and DWSC serve in various investment management, advisory,
management and administrative capacities to investment companies and pension
plans and other institutional and individual investors.
MSDWD has its offices at 1585 Broadway, New York, New York 10036. There
are various lawsuits pending against MSDWD involving material amounts which,
in the opinion of its management, will be resolved with no material effect on
the consolidated financial position of the Company.
During the fiscal year ended September 30, 1997, the Trust accrued to DWT,
the Trust's Transfer Agent and an affiliate of the Manager, transfer agency
fees of $152,132.
(3) RATIFICATION OR REJECTION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Trustees have unanimously selected the firm of Price Waterhouse LLP as
the Trust's independent accountants for the fiscal year ending September 30,
1998. Price Waterhouse LLP has been the independent accountants for the Trust
since its inception, and has no direct or indirect financial interest in the
Trust.
A representative of Price Waterhouse LLP is expected to be present at the
Annual Meeting of Shareholders and will be available to respond to
appropriate questions of Shareholders.
The affirmative vote of the holders of a majority of the shares
represented and entitled to vote at the Annual Meeting is required for
ratification of the selection of Price Waterhouse LLP as the independent
accountants for the Trust.
THE TRUSTEES UNANIMOUSLY RECOMMEND THAT THE SHAREHOLDERS RATIFY THE
SELECTION OF PRICE WATERHOUSE LLP AS THE INDEPENDENT ACCOUNTANTS FOR THE
TRUST.
(4) SHAREHOLDER PROPOSAL TO AMEND THE DECLARATION OF TRUST OF TCW/DW TERM
TRUST 2002 TO REQUIRE THAT EACH TRUSTEE, WITHIN THIRTY DAYS OF ELECTION,
BECOME A SHAREHOLDER OF THE TRUST
The Trust has been informed by Edwin S. Mullett, 230 East Shore Drive,
Lake Toxaway, NC 28747, a shareholder of record who owned approximately
shares at October 24, 1997 (the "Proponent"), that he intends to submit the
following proposal (the "Shareholder Proposal") at the Meeting:
RESOLVED, that the Declaration of Trust be amended to require that each
Trustee, within thirty days of election, become a shareholder of the Trust.
The Proponent has requested that the following statement be included in
support of his proposal:
It seems obvious that the Trustees could better understand and represent
the interests of shareholders if they were shareholders themselves. Yet
according to the last proxy statement, not one of our Trustees owns a
single share of our Trust. In fact, no Trustee has EVER been a
shareholder. You can read below the Trustees' explanations seeking to
convince you that we are better off because they are not shareholders.
Let's look at their reasons:
1. "The Trust's objectives and policies may not be appropriate for a
Trustee"--apparently none of the Trustees share our objectives. Wouldn't
you prefer to have Trustees who seek our objectives?
2. "The Trustees believe that any policy requiring Trustees to own shares
in a specific Fund . . . could logically be extended to all the Funds."
This excuse is nothing but a smokescreen since my proposal concerns only
our Trust and has no application to any other fund.
3. In order to "address shareholder concerns" the Trustees adopted a
policy requiring them to invest $25,000 in OTHER funds. (Incidentally,
this policy was adopted only after my proposal). Are your
13
<PAGE>
"concerns" and "expectations" met because the Trustees have agreed to
invest in some other funds? Do you know they can even meet this
requirement with money market funds?
I hope you will vote for this proposal and encourage the Trustees to join
us as shareholders in OUR Trust.
THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS THAT YOU VOTE AGAINST THE
SHAREHOLDER PROPOSAL.
RECOMMENDATION OF THE BOARD OF TRUSTEES
The Proponent has twice requested that a similar proposal be included in
the proxy statement relating to the two previous annual meetings. Each
proposal was included and was defeated by shareholders. The Trustees
determined to oppose the proposals each year. The Trustees considered whether
a share ownership requirement for Trustees such as that proposed by the
Proponent was in the best interests of the Trust and its shareholders and
they concluded that it was not. Once again, the reasons for the Trustees
decision to oppose the Shareholder Proposal are reiterated below.
THE SHARE OWNERSHIP POLICY
The Trustees have adopted a policy pursuant to which each Trustee, and/or
his or her spouse, is required to invest at least $25,000 in any of the Funds
in the TCW/DW complex, including the Trust (and, if applicable, in the Dean
Witter Funds), on whose boards the Trustee serves. Thus, the Proponent
misstates the policy since it DOES include the Trust. In addition, the policy
contemplates that the Trustees will, over time, increase their aggregate
investment in the Funds above the $25,000 minimum requirement. The Trustees
may allocate their investments among specific Funds in any manner they
determine is appropriate based on their individual investment objectives. Any
future Trustee will be given a one year period within which to comply with
the foregoing policy. As of October 24, 1997, the total value of shares of
the TCW/DW Funds (and, if applicable, the Dean Witter Funds) owned by the
Trustees and/or their spouses was approximately $ million.
REASONS FOR OPPOSING THE SHAREHOLDER PROPOSAL
The share ownership policy requires the Trustees make a significant
investment in the funds in the TCW/DW complex, which includes the Trust,
while allowing the Trustees to select the specific funds that meet their
individual investment needs. As they stated in last year's proxy statement,
the Trustees believe it is not necessary to own shares of this particular
Trust to act in the best interests of shareholders and that they can carry
out their duties and functions diligently and effectively without owning
shares of the Trust. In addition, because the Trust's objectives and policies
may not be appropriate for a Trustee's individual financial circumstances,
the Trust could be inhibited in its ability to attract Trustees if the
available pool is limited to those whose personal financial needs are met by
the Trust's objectives and policies.
The Trustees continue to believe that any policy requiring the Trustees to
own shares of a specific Fund for which they serve as Trustees, without
regard to their own respective investment objectives, could logically be
extended to all the Funds in the TCW/DW complex. The Trustees believe that
such a complex-wide share ownership requirement would be impractical and
undesirable because it could make it more difficult to maintain the same
board of Trustees for all the Funds in the complex. The Trustees believe that
having the same Trustees for each of the TCW/DW Funds is in the best
interests of all the Funds' shareholders for several reasons. First, a common
board enhances the ability of each Fund to obtain, at modest cost to each
separate Fund, the services of high caliber Trustees. In addition, having a
common board avoids the duplication of effort that would arise from having
different groups of individuals serving as Trustees for each of the Funds and
avoids the cost and confusion that may arise from different conclusions being
reached by different boards on the same
14
<PAGE>
operations and management issues. Finally, serving as Trustees of all Funds
tends to increase a Trustee's knowledge and expertise regarding matters which
affect all the Funds in the complex and enhances the ability to negotiate on
behalf of each Fund with the Fund's service providers.
For the reasons stated above and in light of the fact that they have
adopted the share ownership policy described above, the Trustees unanimously
recommend that shareholders vote AGAINST the shareholder proposal.
The affirmative vote of the holders of a majority of the shares
outstanding and entitled to vote at the Meeting is required for the approval
of the Shareholder Proposal.
ADDITIONAL INFORMATION
In the event that the necessary quorum to transact business or the vote
required to approve or reject any proposal is not obtained at the Meeting,
the persons named as proxies may propose one or more adjournments of the
Meeting for a total of not more than 60 days in the aggregate to permit
further solicitation of proxies. Any such adjournment will require the
affirmative vote of the holders of a majority of the Trust's shares present
in person or by proxy at the Meeting. The persons named as proxies will vote
in favor of such adjournment those proxies which they are entitled to vote in
favor of Proposal 2 and will vote against any such adjournment those proxies
required to be voted against that proposal.
Abstentions and, if applicable, broker "non-votes" will not count as votes
in favor of any of the proposals, and broker "non-votes" will not be deemed
to be present at the meeting for purposes of determining whether a particular
proposal to be voted upon has been approved. Broker "non-votes" are shares
held in street name for which the broker indicates that instructions have not
been received from the beneficial owners or other persons entitled to vote
and for which the broker does not have discretionary voting authority.
Four purported class action lawsuits have been filed in the Superior Court
for the State of California, County of Orange, against some of the Trust's
Trustees and officers, one of its underwriters, the lead representative of
its underwriters, the Adviser, the Manager and other defendants -- but not
against the Trust -- by certain shareholders of the Trust and other trusts
for which the defendants act in similar capacities. These plaintiffs
generally allege violations of state statutory and common law in connection
with the marketing of the Trust to customers of one of the underwriters.
Damages, including punitive damages, are sought in an unspecified amount. On
or about October 20, 1995, the plaintiffs filed an amended complaint
consolidating these four actions. The defendants filed answers and
affirmative defenses to the consolidated amended complaint. The defendants'
answers deny all of the material allegations of the plaintiffs' complaint. In
1996, the plaintiffs voluntarily dismissed, without prejudice, their claims
against two defendants who were independent Trustees of the Trusts. In March
1997, all of the remaining defendants in the litigation filed motions for
judgment on the pleadings, seeking dismissal of all of the claims asserted
against them. The defendants' motions were fully briefed by all parties and
were the subject of a hearing before the Court on April 18, 1997. In July,
1997, the Court denied the motion for judgment on the pleadings.
Certain of the defendants in these suits have asserted their right to
indemnification from the Trust.
The ultimate outcome of these matters is not presently determinable, and
no provision has been made in the Trust's financial statements for the
effect, if any, of such matters.
SHAREHOLDER PROPOSALS
Proposals of security holders intended to be presented at the next Annual
Meeting of Shareholders must be received no later than July , 1998 for
inclusion in the proxy statement and proxy for that meeting. The mere
submission of a proposal does not guarantee its inclusion in the proxy
materials or its presentation at the meeting. Certain rules under the federal
securities laws must be met.
15
<PAGE>
REPORTS TO SHAREHOLDERS
THE TRUST'S MOST RECENT ANNUAL REPORT AND ITS MOST RECENT SEMI-ANNUAL
REPORT SUCCEEDING THE ANNUAL REPORT ARE AVAILABLE WITHOUT CHARGE UPON REQUEST
FROM ADRIENNE RYAN-PINTO AT DEAN WITTER TRUST FSB, HARBORSIDE FINANCIAL
CENTER, PLAZA TWO, JERSEY CITY, NEW JERSEY 07311 (TELEPHONE 1-800-869-NEWS)
(TOLL-FREE).
INTEREST OF CERTAIN PERSONS
MSDWD, InterCapital, DWR, DWSC, The TCW Group, Inc. and its affiliates,
and certain of the respective Directors, Officers, and employees of each,
including persons who are Trustees or Officers of the Trust, may be deemed to
have an interest in certain of the proposals described in this Proxy
Statement to the extent that certain of such companies and their affiliates
have contractual and other arrangements, described elsewhere in this Proxy
Statement, pursuant to which they are paid fees by the Trust, and certain of
those individuals are compensated for performing services relating to the
Trust and may also own shares of MSDWD and The TCW Group, Inc. Such companies
and persons may thus be deemed to derive benefits from the approvals by
Shareholders of such proposals.
OTHER BUSINESS
The management knows of no other matters which may be presented at the
Meeting. However, if any matters not now known properly come before the
Meeting, it is intended that the persons named in the attached form of proxy,
or their substitutes, will vote such proxy in accordance with their judgment
on such matters.
By Order of the Trustees
BARRY FINK
Secretary
16
<PAGE>
APPENDIX
TCW Funds Management Inc. serves as investment adviser to the Trust as
well as investment adviser to the other investment companies listed below
which have similar investment objectives to that of the Trust, with net
assets shown as of October 24, 1997.
<TABLE>
<CAPTION>
ANNUAL
MANAGEMENT
FEE AS PERCENT
NET ASSETS ON OF AVERAGE
NAME 10/24/97 NET ASSETS
- ---------------------- --------------- --------------
<S> <C> <C>
TCW/DW Term Trust
2003.................. $ (1)
TCW/DW Term Trust
2002.................. $ (1)
TCW/DW Term Trust
2000.................. $ (2)
</TABLE>
- ------------
1. 0.26% of the Trust's weekly net assets.
2. 0.24% of the Trust's weekly net assets.
I-1
<PAGE>
TCW/DW TERM TRUST 2002
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
The undersigned hereby appoints Robert M. Scanlan, Barry Fink, and Robert S.
Giambrone, or any of them, proxies, each with the power of substitution, to
vote on behalf of the undersigned at the Annual Meeting of Shareholders of
TCW/DW Term Trust 2002 on December 18, 1997, at , New York City time,
and at any adjournment thereof, on the proposals set forth in the Notice of
Meeting dated November , 1997 as follows:
(Continued on reverse side)
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDER SIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED "FOR" THE NOMINEES FOR TRUSTEE AND FOR PROPOSALS 2 AND 3 AND AGAINST
PROPOSAL 4 SET FORTH ON THE REVERSE HEREOF AND AS RECOMMENDED BY THE BOARD OF
TRUSTEES.
IMPORTANT -- THIS PROXY MUST BE SIGNED AND DATED ON THE REVERSE SIDE.
<PAGE>
[X] PLEASE MARK VOTES AS
IN THE EXAMPLE USING
BLACK OR BLUE INK
1. Election of four (4) Trustees: FOR ALL
John R. Haire, Dr. Manuel H. Johnson, FOR WITHHOLD EXCEPT
John L. Schroeder, Marc I. Stern. [ ] [ ] [ ]
IF YOU WISH TO WITHHOLD AUTHORITY FOR ANY PARTICULAR NOMINEE, MARK THE
"FOR ALL EXCEPT" BOX AND STRIKE A LINE THROUGH THE NOMINEE'S NAME.
2. Approval of the continuance of the
Investment Advisory Agreement FOR AGAINST ABSTAIN
with TCW Funds Management, Inc. [ ] [ ] [ ]
3. Ratification of appointment of Price FOR AGAINST ABSTAIN
Waterhouse LLP as independent [ ] [ ] [ ]
accountants.
4. Shareholder proposal FOR AGAINST ABSTAIN
(NOTE: THE TRUSTEES RECOMMEND [ ] [ ] [ ]
A VOTE AGAINST THIS PROPOSAL)
Date
---------------------------
Please make sure to sign and date
this Proxy using black or blue ink.
------------------------------------------------------------------------
| |
------------------------------------------------------------------------
Shareholder sign in the box above
------------------------------------------------------------------------
| |
------------------------------------------------------------------------
Co-Owner (if any) sign in the box above
- ------------------------------------------------------------------------------
PRX 00090 PLEASE DETACH AT PERFORATION
TCW/DW TERM TRUST 2002
- ----------------------------------------------------------------------------
IMPORTANT
PLEASE SEND IN YOUR PROXY.........TODAY!
YOU ARE URGED TO DATE AND SIGN THE ATTACHED PROXY AND RETURN IT PROMPTLY IN
THE ENCLOSED ENVELOPE. THIS WILL HELP SAVE THE EXPENSE OF FOLLOW-UP LETTERS
TO SHAREHOLDERS WHO HAVE NOT RESPONDED.
- ----------------------------------------------------------------------------
