PROSPECTUS Dated March 26, 1998 Pricing Supplement No. 4 to
PROSPECTUS SUPPLEMENT Registration Statement No. 333-46935
Dated March 26, 1998 March 31, 1998
Rule 424(b)(3)
$9,000,000
Morgan Stanley Dean Witter & Co.
MEDIUM-TERM NOTES, SERIES C
Senior Fixed Rate Notes
1% EXCHANGEABLE NOTES DUE APRIL 15, 2005
Exchangeable For Shares of Common Stock of
Six Telecommunications Corporations
The 1% Exchangeable Notes due April 15, 2005 (the "Notes"), are
Medium-Term Notes, Series C (Senior Fixed Rate Notes) of Morgan Stanley Dean
Witter & Co. (the "Company"), as further described below and in the Prospectus
Supplement under "Description of Notes--Fixed Rate Notes" and "--Exchangeable
Notes." The Notes will bear interest at the rate of 1% per annum (the "Stated
Coupon Rate") payable semi-annually on April 15 and October 15 of each year
(each an "Interest Payment Date") commencing October 15, 1998. The issue price
of each Note will be $1,000 (the "Issue Price"). The Notes are issued in
minimum denominations of $1,000 and will mature on April 15, 2005.
On any Exchange Date (as defined herein), the holder of a Note
will have the right (the "Exchange Right"), subject to a prior call of the
Notes for cash by the Company (as described in the immediately succeeding
paragraph) and upon completion by the holder and delivery to the Company and
the Calculation Agent of an Official Notice of Exchange prior to 11:00 a.m.
New York City time on such date, to exchange each $1,000 principal amount of
such Note for a basket (the "Basket") of the common stocks of six
telecommunications corporations (the "Basket Corporations") listed herein
(collectively the "Basket Stocks" and individually a "Basket Stock"), subject
to the Company's right to pay cash in lieu of delivering such Basket Stocks,
as described below. The Basket consists of a fixed number of shares of each
Basket Stock (each such number an "Exchange Ratio") calculated on the date of
pricing so that each Basket Stock constitutes an assigned percentage of the
Initial Basket Value. The Initial Basket Value has been set to equal $843.88
per Note based on the Market Prices of the Basket Stocks on the date hereof.
See "Basket Stocks" in this Pricing Supplement. The Company may at its option
upon the exchange of any Note pay cash in an amount for each $1,000 principal
amount of such Note equal to the sum of the products of the Market Price of
each Basket Stock and the Exchange Ratio for such Basket Stock, each as
determined by the Calculation Agent on the Exchange Date (the "Basket Value")
in lieu of delivering the Basket Stocks. The Exchange Ratio with respect to
any Basket Stock will remain constant for the term of the Notes unless
adjusted for certain corporate events. See "Adjustments to the Exchange
Ratios and the Basket" in this Pricing Supplement. An Exchange Date will be
any Trading Day (as defined herein) that falls during the period beginning
July 6, 1998 and ending on the day prior to the earliest of the Maturity Date,
the Call Date (as defined below) and, in the event of a call for cash as
described under "Company Exchange Right" herein, the Company Notice Date (as
defined herein).
On or after April 1, 2001, the Company may call the Notes, in
whole but not in part, for mandatory exchange into the Basket Stocks at their
respective Exchange Ratios; provided that, if the Basket Value (as defined
herein) as determined on the Trading Day immediately prior to the Company
Notice Date is less than the Call Price (as defined herein) for such Company
Notice Date, the Company will pay such applicable Call Price in cash on the
date (the "Call Date") not less than 30 nor more than 60 days after the
Company Notice Date, as specified by the Company. If the Notes are so called
for mandatory exchange, the Basket Stocks or cash to be delivered to holders
of Notes will be delivered on the Call Date.
The Basket Corporations are neither affiliated with the Company
nor involved in this offering of the Notes. See "Historical Information" in
this Pricing Supplement for information on the range of Market Prices for the
Basket Stocks.
The Company will cause the Basket Value and any adjustments to
the Exchange Ratios to be determined by the Calculation Agent for The Chase
Manhattan Bank (formerly known as Chemical Bank) as Trustee under the Senior
Debt Indenture.
An investment in the Notes entails risks not associated with
similar investments in a conventional debt security, as described under " Risk
Factors" on PS-6 and PS-7 herein.
The Notes have been approved for listing on the American Stock
Exchange, Inc. ("AMEX"), subject to official notice of issuance. The AMEX
symbol for the Notes is "TBB.A." It is not possible to predict whether the
Notes will trade in the secondary market or if such market will be liquid or
illiquid.
--------------
PRICE 100% AND ACCRUED INTEREST
--------------
<TABLE>
Price to Public(1) Agent's Commissions(2) Proceeds to Company(1)
------------------ ---------------------- ----------------------
<S> <C> <C> <C>
Per Note.......... 100% .25% 99.75%
Total............. $9,000,000 $22,500 $8,977,500
</TABLE>
(1) Plus accrued interest, if any, from April 7, 1998.
(2) The Company has agreed to indemnify the Agent against certain liabilities,
including liabilities under the Securities Act of 1933.
MORGAN STANLEY DEAN WITTER
(This page intentionally left blank)
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE BASKET
STOCKS. SPECIFICALLY, THE AGENT MAY OVERALLOT IN CONNECTION WITH THE
OFFERING, AND MAY BID FOR, AND PURCHASE THE BASKET STOCKS IN THE OPEN
MARKET. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "USE OF PROCEEDS AND
HEDGING" IN THIS PRICING SUPPLEMENT AND "PLAN OF DISTRIBUTION" IN THE
ACCOMPANYING PROSPECTUS SUPPLEMENT.
Capitalized terms not defined herein have the meanings given to such terms in
the accompanying Prospectus Supplement.
Principal Amount.............. $9,000,000
Maturity Date................. April 15, 2005
Stated Coupon Rate............ 1% per annum
Interest Payment Dates........ April 15 and October 15, beginning October
15, 1998
Specified Currency............ U.S. Dollars
Issue Price................... $1,000
Original Issue Date
(Settlement Date)............. April 7, 1998
CUSIP......................... 617446CX5
Book Entry Note or
Certificated Note.............. Book Entry, DTC
Senior Note or Subordinated
Note........................... Senior
Minimum Denominations......... $1,000
Agent......................... Morgan Stanley & Co. Incorporated
Trustee....................... The Chase Manhattan Bank
Initial Basket Value.......... $843.88. Based on the Market Prices (as
defined below) of the Basket Stocks on the
date of this Pricing Supplement, the Exchange
Ratios have been initially set so that the
Basket Value on such date equals the Initial
Basket Value.
Basket Value.................. The Basket Value, for any day, will equal the
sum of the products of the Market Prices and
the applicable Exchange Ratios for each
Basket Stock, each determined as of such date
by the Calculation Agent.
Basket ....................... The basket is a weighted portfolio of the six
Basket Stocks. See "Basket Stocks" below.
Basket Stocks................. The following table sets forth the Basket
Stocks, the percentage of the Initial Basket
Value represented by each Basket Stock, the
initial Market Price of each Basket Stock as
of the date of this Pricing Supplement, the
Exchange Ratio of each Basket Stock as of the
date of this Pricing Supplement and the
initial value of each Basket Stock as of the
date of this Pricing Supplement:
<TABLE>
Percent
Represented Initial
in Initial Stock Exchange Initial
Issuer of Basket Stock Ticker Basket Value Price Ratio Value
- ---------------------- ------ ------------ ------- -------- -------
<S> <C> <C> <C> <C> <C>
Ascend Communications, Inc.
("Ascend") ................... ASND 20% $37.9375 4.4488 $168.7764
Telefonaktiebolaget LM
Ericsson ("Ericsson")......... ERICY 10% $47.5625 1.7743 $84.3901
Lucent Technologies Inc.
("Lucent").................... LU 20% $127.875 1.3199 $168.7822
Nokia Corporation
("Nokia") ADR "A"............. NOK.A 10% $107.9375 0.7818 $84.3855
Tellabs, Inc. ("Tellabs")....... TLAB 20% $67.1875 2.5120 $168.7750
WorldCom, Inc.
("WorldCom").................. WCOM 20% $43.0625 3.9193 $168.7749
</TABLE>
The Exchange Ratio of each Basket Stock
indicates the number of shares of such Basket
Stock, given the Market Price of such Basket
Stock, required to be included in the
calculation of the Initial Basket Value so
that each Basket Stock represents the
percentage of the Initial Basket Value as
assigned to it in the table above as of the
date of this Pricing Supplement. The
respective Exchange Ratios will remain
constant for the term of the Notes unless
adjusted for certain corporate events. See
"Adjustments to the Exchange Ratios and the
Basket."
Exchange Right................ On any Exchange Date, subject to a prior call
of the Notes for cash in an amount equal to
the Call Price by the Company as described
under "Company Exchange Right" below, the
holders of Notes will be entitled upon (i)
completion by the holder and delivery to the
Company and the Calculation Agent of an
Official Notice of Exchange (in the form of
Annex A attached hereto) prior to 11:00 a.m.
New York City time on such date and (ii)
delivery on such date of such Notes to the
Trustee, to exchange each $1,000 principal
amount of Notes for a number of shares of
each Basket Stock equal to the Exchange Ratio
for such Basket Stock, subject to adjustment
as described under "Adjustments to the
Exchange Ratios and the Basket" below. Upon
any such exchange, the Company may, at its
sole option, deliver such Basket Stocks or
pay an amount in cash equal to the Basket
Value on the Exchange Date, as determined by
the Calculation Agent, in lieu of delivering
such Basket Stocks. Such delivery or payment
will be made 3 Business Days after any
Exchange Date, subject to delivery of such
Notes to the Trustee on the Exchange Date.
Upon any exercise of the Exchange Right,
holders of such exchanged Notes shall not be
entitled to receive accrued but unpaid
interest thereon. If any Notes are exchanged
after a record date for the payment of
interest and prior to the next succeeding
Interest Payment Date, such Notes must be
accompanied by funds equal to the interest
payable on such succeeding Interest Payment
Date on the principal amount so exchanged.
References to payment "per Note" refer to
each $1,000 principal amount of any Note.
The Company shall, or shall cause the
Calculation Agent to, deliver such Basket
Stocks or cash to the Trustee for delivery to
the holders.
No Fractional Shares ......... If upon any exchange of the Notes the Company
chooses to deliver the Basket Stocks, the
Company will pay cash in lieu of delivering
fractional shares of any Basket Stocks in an
amount equal to the corresponding fractional
Market Price of such Basket Stock as
determined by the Calculation Agent on such
Exchange Date.
Exchange Ratios............... The Exchange Ratios set forth under "Basket
Stocks" above are subject to adjustment for
certain corporate events. See "Adjustments
to the Exchange Ratios and Basket" below.
Exchange Date................. Any Trading Day that falls during the period
beginning July 6, 1998 and ending on the day
prior to the earliest of (i) the Maturity
Date, (ii) the Call Date and (iii) in the
event of a call for cash as described under
"Company Exchange Right" below, the Company
Notice Date.
Company Exchange Right ....... On or after April 1, 2001, the Company may
call the Notes, in whole but not in part, for
mandatory exchange into the Basket Stocks at
the applicable Exchange Ratios; provided
that, if the Basket Value on the Trading Day
immediately preceding the Company Notice Date,
as determined by the Calculation Agent, is
less than the Call Price the Company will pay
such Call Price in cash on the Call Date. If
the Notes are so called for mandatory
exchange by the Company, then, unless a
holder subsequently exercises the Exchange
Right (the exercise of which will not be
available to the holder following a call for
cash in an amount equal to the Call Price),
the Basket Stocks or cash to be delivered to
holders of Notes will be delivered on the Call
Date fixed by the Company and set forth in
its notice of mandatory exchange, upon
delivery of such Notes to the Trustee. The
Company shall, or shall cause the Calculation
Agent to, deliver such Basket Stocks or cash
to the Trustee for delivery to the holders.
On or after the Company Notice Date (other
than with respect to a call of the Notes for
cash by the Company) holders of the Notes will
continue to be entitled to exercise the
Exchange Right and receive any amounts
described under "Exchange Right" above.
Company Notice Date........... Any Trading Day on which the Company issues
its notice of mandatory exchange which must
be 30 to 60 days prior to any Trading Day on
or after April 1, 2001.
Call Price.................... $1,000 per Note.
Market Price.................. If a Basket Stock is listed on a national
securities exchange, is a security of The
Nasdaq National Market ("NASDAQ NMS") or is
included in the OTC Bulletin Board Service
("OTC Bulletin Board") operated by the
National Association of Securities Dealers,
Inc. (the "NASD"), the Market Price for one
share of such Basket Stock on any Trading Day
means (i) the last reported sale price,
regular way, on such day on the principal
United States securities exchange registered
under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), on which such
Basket Stock is listed or admitted to trading
or (ii) if not listed or admitted to trading
on any such securities exchange or if such
last reported sale price is not obtainable,
the last reported sale price on the
over-the-counter market as reported on the
NASDAQ NMS or OTC Bulletin Board on such day.
If the last reported sale price is not
available pursuant to clause (i) or (ii) of
the preceding sentence, the Market Price for
any Trading Day shall be the mean, as
determined by the Calculation Agent, of the
bid prices for such Basket Stock obtained
from as many dealers in such security, but
not exceeding three, as will make such bid
prices available to the Calculation Agent.
The term "NASDAQ NMS security" shall include
a security included in any successor to such
system and the term "OTC Bulletin Board
Service" shall include any successor service
thereto.
Trading Day................... A day on which trading is generally conducted
on the New York Stock Exchange ("NYSE"), the
AMEX, the NASDAQ National Market ("NASDAQ
NMS"), the Chicago Mercantile Exchange and
the Chicago Board of Options Exchange, as
determined by the Calculation Agent.
Calculation Agent............. Morgan Stanley & Co. Incorporated ("MS & Co.")
Because the Calculation Agent is an affiliate
of the Company, potential conflicts of
interest may exist between the Calculation
Agent and the holders of the Notes, including
with respect to certain determinations and
judgments that the Calculation Agent must make
in making adjustments to the Exchange Ratio
or determining the Market Price or whether a
Market Disruption Event has occurred. See
"Adjustment to the Exchange Ratios and the
Basket" and "Market Disruption Event" below.
MS & Co. is obligated to carry out its duties
and functions as Calculation Agent in good
faith and using its reasonable judgment.
All percentages resulting from any
calculation on the Notes will be rounded to
the nearest one hundred-thousandth of a
percentage point, with five one-millionths of
a percentage point rounded upwards (e.g.,
9.876545% (or .09876545) would be rounded to
9.87655% (or .0987655)), and all dollar
amounts used in or resulting from such
calculation except for the Basket Value will
be rounded to the nearest one hundredth of a
cent with five one thousandths of a cent
being rounded upwards (e.g., $.09875 would be
rounded to $.0988). The Basket Value will be
rounded up to the nearest cent with one-
half cent being rounded upwards.
Risk Factors.................. An investment in the Notes entails
significant risks not associated with similar
investments in a conventional debt security,
including the following:
The yield to maturity is less than would be
payable on a non-exchangeable debt security
if the Company were to issue such a security
at the same time it issues the Notes.
There can be no assurance as to how the Notes
will trade in the secondary market or whether
such market will be liquid or illiquid. The
market value for the Notes will be affected
by a number of factors independent of the
creditworthiness of the Company and the value
of the Basket Stocks, including, but not
limited to, the volatility of the Basket
Stocks, the dividend rate on the Basket
Stocks, market interest and yield rates and
the time remaining to the first Exchange
Date, any Call Date or the maturity of the
Notes. In addition, the value of the Basket
Stocks depends on a number of interrelated
factors, including economic, financial and
political events, over which the Company has
no control. The market value of the Notes is
expected to depend primarily on the extent of
the appreciation, if any, of the Market
Prices of the Basket Stocks above the Initial
Market Price. The price at which a holder
will be able to sell Notes prior to maturity
may be at a discount, which could be
substantial, from the accreted principal
amount thereof, if, at such time, the Market
Prices of the Basket Stocks are below, equal
to or not sufficiently above the Initial
Market Price. The historical Market Prices
of the Basket Stocks should not be taken as
an indication of the Basket Stocks' future
performance during the term of any Note.
The Company is not affiliated with any of the
issuers of the Basket Stocks and, although
the Company as of the date of this Pricing
Supplement does not have any material
non-public information concerning any of the
issuers of the Basket Stocks, corporate events
of any of the issuers of the Basket Stocks,
including those described below in
"Adjustments to the Exchange Ratios and the
Basket," are beyond the Company's ability to
control and are difficult to predict.
None of the issuers of the Basket Stocks are
involved in the offering of the Notes and
have any obligations with respect to the
Notes, including any obligation to take the
interests of the Company or of holders of
Notes into consideration for any reason.
None of the issuers of the Basket Stocks will
receive any of the proceeds of the offering
of the Notes made hereby and are responsible
for, and have participated in, the
determination of the timing of, prices for or
quantities of, the Notes offered hereby.
Because the Calculation Agent is an affiliate
of the Company, potential conflicts of
interest may exist between the Calculation
Agent and the holders of the Notes, including
with respect to certain adjustments to the
Exchange Ratios that may influence the
determination of the Basket Value or of the
amount of stock or cash receivable upon
exercise of the Exchange Right or the Company
Exchange Right. See "Adjustments to the
Exchange Ratios and the Basket" and "Market
Disruption Event."
It is suggested that prospective investors
who consider purchasing the Notes should
reach an investment decision only after
carefully considering the suitability of the
Notes in light of their particular
circumstances.
Investors should also consider the tax
consequences of investing in the Notes. See
"United States Federal Taxation" below.
Adjustments to the Exchange
Ratios and the Basket......... The Exchange Ratio with respect to any Basket
Stock and the Basket will be adjusted as
follows:
1. If a Basket Stock is subject to a stock
split or reverse stock split, then once such
split has become effective, the Exchange Ratio
applicable to such Basket Stock will be
adjusted to equal the product of the number
of shares issued with respect to one share of
such Basket Stock and the prior Exchange
Ratio.
2. If a Basket Stock is subject to a stock
dividend (issuance of additional shares of
the Basket Stock) that is given ratably to all
holders of shares of such Basket Stock, then
once the dividend has become effective and
such Basket Stock is trading ex-dividend, the
Exchange Ratio applicable to such Basket
Stock will be adjusted so that the new
Exchange Ratio shall equal the former
Exchange Ratio plus the product of (i) the
number of shares of such Basket Stock issued
with respect to one share of such Basket
Stock and (ii) the prior Exchange Ratio.
3. There will be no adjustments to the
Exchange Ratios to reflect cash dividends or
other distributions paid with respect to a
Basket Stock other than distributions
described in paragraph 6 below and
Extraordinary Dividends as described below. A
cash dividend or other distribution with
respect to a Basket Stock will be deemed to be
an "Extraordinary Dividend" if such dividend
or other distribution exceeds the immediately
preceding non-Extraordinary Dividend for such
Basket Stock by an amount equal to at least
10% of the Market Price of such Basket Stock
on the Trading Day preceding the ex- dividend
date for the payment of such Extraordinary
Dividend (the "ex-dividend date"). If an
Extraordinary Dividend occurs with respect to
a Basket Stock, the Exchange Ratio with
respect to such Basket Stock will be adjusted
on the ex-dividend date with respect to such
Extraordinary Dividend so that the new
Exchange Ratio will equal the product of (i)
the then current Exchange Ratio, and (ii) a
fraction, the numerator of which is the Market
Price on the Trading Day preceding the
ex-dividend date, and the denominator of which
is the amount by which the Market Price on the
Trading Day preceding the ex-dividend date
exceeds the Extraordinary Dividend Amount.
The "Extraordinary Dividend Amount" with
respect to an Extraordinary Dividend for a
Basket Stock will equal (i) in the case of
cash dividends or other distributions that
constitute quarterly dividends, the amount per
share of such Extraordinary Dividend minus the
amount per share of the immediately preceding
non- Extraordinary Dividend for such Basket
Stock or (ii) in the case of cash dividends or
other distributions that do not constitute
quarterly dividends, the amount per share of
such Extraordinary Dividend. To the extent an
Extraordinary Dividend is not paid in cash,
the value of the non-cash component will be
determined by the Calculation Agent, whose
determination shall be conclusive. A
Distribution on a Basket Stock described in
paragraph 6 below that also constitutes an
Extraordinary Dividend shall only cause an
adjustment to the Exchange Ratio for such
Basket Stock pursuant to paragraph 6.
4. If the issuer of a Basket Stock is being
liquidated or is subject to a proceeding
under any applicable bankruptcy, insolvency
or other similar law, such Basket Stock will
continue to be included in the Basket so long
as a Market Price for such Basket Stock is
available. If a Market Price is no longer
available for a Basket Stock for whatever
reason, including the liquidation of the
issuer of such Basket Stock or the subjection
of the issuer of such Basket Stock to a
proceeding under any applicable bankruptcy,
insolvency or other similar law, then the
value of such Basket Stock will equal zero in
connection with the calculation of the Basket
Value for so long as no Market Price is
available, and no attempt will be made to
find a replacement stock or increase the
Basket Value to compensate for the deletion
of such Basket Stock.
5. If there occurs any reclassification or
change of a Basket Stock, or if an issuer of
a Basket Stock has been subject to a merger,
combination or consolidation and is not the
surviving entity, or if there occurs a sale
or conveyance to another corporation of the
property and assets of any of the issuers of
Basket Stocks as an entirety or substantially
as an entirety, in each case as a result of
which the holders of a Basket Stock shall be
entitled to receive stock, other securities
or other property or assets (including cash)
with respect to or in exchange for such
Basket Stock, then the holders of the Notes
then outstanding will be entitled thereafter
to exchange such Notes into the kind and
amount of shares of stock, other securities
or other property or assets that they would
have owned or been entitled to receive upon
such reclassification, change, merger,
combination, consolidation, sale or
conveyance had such holders exchanged such
Notes for Basket Stock immediately prior to
any such corporate event. At such time, no
adjustment will be made to the Exchange Ratio.
6. If the issuer of a Basket Stock issues to
all of its shareholders equity securities of
an issuer other than the issuer of the Basket
Stock (other than in a transaction described
in paragraph 5 above), then such new equity
securities will be added to the Basket as a
new Basket Stock, unless the Market Price of
such new equity securities cannot be
determined using the procedures described
above under "Market Price." The Exchange
Ratio for such new Basket Stock will equal
the product of the original Exchange Ratio
for the Basket Stock for which the new Basket
Stock is being issued (the "Initial Basket
Stock") and the number of shares of the new
Basket Stock issued with respect to one share
of the Initial Basket Stock.
No adjustments to any Exchange Ratio will be
required unless such adjustment would require
a change of at least 0.1% in the Exchange
Ratio then in effect. The Exchange Ratio
resulting from any of the adjustments
specified above will be rounded to the
nearest one thousandth with five
ten-thousandths being rounded upward.
No adjustments to any Exchange Ratio will be
made other than those specified above. The
adjustments specified above do not cover all
events that could affect the Market Price of
a Basket Stock.
The Calculation Agent shall be solely
responsible for the determination and
calculation of any adjustments to the Exchange
Ratios and of any related determinations and
calculations with respect to any
distributions of stock, other securities or
other property or assets (including cash) in
connection with any corporate event described
in paragraph 5 or 6 above, and its
determinations and calculations with respect
thereto shall be conclusive.
The Calculation Agent will provide
information as to any adjustments to the
Exchange Ratios upon written request by any
holder of the Notes.
Market Disruption Event....... "Market Disruption Event" means, with respect
to any Basket Stock:
(i) a suspension, absence or material
limitation of trading of such Basket Stock
on the primary market for such Basket Stock
for more than two hours of trading or
during the one-half hour period preceding
the close of trading in such market; or the
suspension, absence or material limitation
on the primary market for trading in
options contracts related to such Basket
Stock, if available, during the one-half
hour period preceding the close of trading
in the applicable market, in each case as
determined by the Calculation Agent in its
sole discretion; and
(ii) a determination by the Calculation
Agent in its sole discretion that the
event described in clause (i) above
materially interfered with the ability of
the Company or any of its affiliates to
unwind all or a material portion of the
hedge with respect to the Notes.
For purposes of determining whether a
Market Disruption Event has occurred: (1)
a limitation on the hours or number of
days of trading will not constitute a
Market Disruption Event if it results from
an announced change in the regular
business hours of the relevant exchange,
(2) a decision to permanently discontinue
trading in the relevant contract will not
constitute a Market Disruption Event, (3)
limitations pursuant to New York Stock
Exchange Rule 80A (or any applicable rule
or regulation enacted or promulgated by
the New York Stock Exchange, any other
self-regulatory organization or the
Securities and Exchange Commission of
similar scope as determined by the
Calculation Agent) on trading during
significant market fluctuations will
constitute a suspension or material
limitation of trading (4) a suspension of
trading in an options contract on any
Basket Stock by the primary securities
market for trading in such options, if
available, by reason of (x) a price change
exceeding limits set by such securities
exchange or market, (y) an imbalance of
orders relating to such contracts or (z) a
disparity in bid and ask quotes relating
to such contracts will constitute a
suspension or material limitation of
trading in options contracts related to
such Basket Stock and (5) a "suspension,
absence or material limitation of trading"
on the primary securities market on which
options contracts related to such Basket
Stock are traded will not include any time
when such securities market is itself
closed for trading under ordinary
circumstances.
Alternate Exchange
Calculation in case
of an Event of Default........ In case an Event of Default with respect to
the Notes shall have occurred and be
continuing, the amount declared due and
payable upon any acceleration of any Note
shall be determined by MS & Co, as
Calculation Agent, and shall be equal to the
Issue Price of a Note and any accrued
interest at the Stated Coupon Rate to but not
including the date of acceleration; provided
that if (x) the holder of a Note has
submitted an Official Notice of Exchange to
the Issuer in accordance with the Exchange
Right or (y) the Issuer has called the Notes,
other than a call for cash, in accordance
with the Company Exchange Right, the amount
declared due and payable upon any such
acceleration shall be an amount in cash for
each $1,000 principal amount of a Note equal
to the Basket Value, determined by the
Calculation Agent as of the Exchange Date or
as of the date of acceleration, respectively,
and shall not include any accrued and unpaid
interest thereon; provided further that if
the Issuer has called the Notes for cash in
an amount equal to the Call Price, in
accordance with the Company Exchange Right,
the amount declared due and payable upon any
such acceleration shall be an amount in cash
for each $1,000 principal amount of a Note
equal to the Call Price. See "Call Price"
above.
Basket Stocks;
Public Information............ Each of the six issuers of Basket Stocks is
registered under the Exchange Act. Companies
with securities registered under the Exchange
Act are required to file periodically certain
financial and other information specified by
the Securities and Exchange Commission (the
"Commission"). Information provided to or
filed with the Commission can be inspected
and copied at the public reference facilities
maintained by the Commission at Room 1024,
450 Fifth Street, N.W., Washington, D.C.
20549 or at its Regional Offices located at
Suite 1400, Citicorp Center, 500 West Madison
Street, Chicago, Illinois 60661 and at Seven
World Trade Center, 13th Floor, New York, New
York 10048, and copies of such material can
be obtained from the Public Reference Section
of the Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates.
In addition, information provided to or filed
with the Commission electronically can be
accessed through a Website maintained by the
Commission. The address of the Commission's
Website is http:/www.sec.gov. Information
provided to or filed with the Commission by
each of the issuers pursuant to the Exchange
Act of 1934 can be located by reference to
its respective Commission file number. In
addition, information regarding each of the
issuers may be obtained from other sources
including, but not limited to, press
releases, newspaper articles and other
publicly disseminated documents. The Company
makes no representation or warranty as to the
accuracy or completeness of such reports.
Ascend develops, manufactures and sells wide
area networking solutions for
telecommunications carriers, internet service
providers and corporation customers
worldwide, and its Commission file number is
0-23774.
Ericsson provides advanced systems and
products for wired and mobile
telecommunications in public and private
networks, and its Commission file number is
0-12033.
Lucent designs, develops, manufactures and
services systems and software which enable
network operators to provide wireline and
wireless access, local, long distance and
international voice, data and video services
and cable television service, and its
Commission file number is 1-11639.
Nokia is a leading international supplier of
telecommunications systems and equipment, and
its Commission file number is 1-13202.
Tellabs designs, manufactures, markets and
services voice, data and video transport and
network access systems that are used
worldwide, and its Commission file number is
0-9692.
WorldCom is one of the largest long distance
telecommunications companies in the United
States and its Commission file number is
0-11258.
THIS PRICING SUPPLEMENT RELATES ONLY TO THE
NOTES OFFERED HEREBY AND DOES NOT RELATE TO
THE BASKET STOCKS OR OTHER SECURITIES OF THE
ISSUERS OF THE BASKET STOCKS. ALL DISCLOSURES
CONTAINED IN THIS PRICING SUPPLEMENT
REGARDING ANY OF THE ISSUERS OF THE BASKET
STOCKS ARE DERIVED FROM THE PUBLICLY
AVAILABLE DOCUMENTS DESCRIBED IN THE
PRECEDING PARAGRAPH. NEITHER THE COMPANY NOR
THE AGENT HAS PARTICIPATED IN THE PREPARATION
OF SUCH DOCUMENTS OR MADE ANY DUE DILIGENCE
INQUIRY WITH RESPECT TO ANY OF THE ISSUERS OF
THE BASKET STOCKS IN CONNECTION WITH THE
OFFERING OF THE NOTES. NEITHER THE COMPANY
NOR THE AGENT MAKES ANY REPRESENTATION THAT
SUCH PUBLICLY AVAILABLE DOCUMENTS OR ANY
OTHER PUBLICLY AVAILABLE INFORMATION
REGARDING ANY OF THE ISSUERS OF THE BASKET
STOCKS ARE ACCURATE OR COMPLETE.
FURTHERMORE, THERE CAN BE NO ASSURANCE THAT
ALL EVENTS OCCURRING PRIOR TO THE DATE HEREOF
(INCLUDING EVENTS THAT WOULD AFFECT THE
ACCURACY OR COMPLETENESS OF THE PUBLICLY
AVAILABLE DOCUMENTS DESCRIBED IN THE
PRECEDING PARAGRAPH) THAT WOULD AFFECT THE
TRADING PRICES OF THE BASKET STOCKS (AND
THEREFORE THE INITIAL MARKET PRICES AND THE
EXCHANGE RATIOS) HAVE BEEN PUBLICLY
DISCLOSED. SUBSEQUENT DISCLOSURE OF ANY SUCH
EVENTS OR THE DISCLOSURE OF OR FAILURE TO
DISCLOSE MATERIAL FUTURE EVENTS CONCERNING
ANY OF THE ISSUERS OF THE BASKET STOCKS COULD
AFFECT THE VALUE RECEIVED ON ANY EXCHANGE
DATE OR CALL DATE WITH RESPECT TO THE NOTES
AND THEREFORE THE TRADING PRICES OF THE NOTES.
NEITHER THE COMPANY NOR ANY OF ITS AFFILIATES
MAKES ANY REPRESENTATION TO ANY PURCHASER OF
NOTES AS TO THE PERFORMANCE OF THE BASKET
STOCKS.
The Company or its affiliates may presently
or from time to time engage in business with
one or more of the issuers of the Basket
Stocks including extending loans to, or
making equity investments in, one or more of
the issuers of the Basket Stocks or providing
advisory services to one or more of the
issuers of the Basket Stocks, including
merger and acquisition advisory services. In
the course of such business, the Company or
its affiliates may acquire non-public
information with respect to one or more of
the issuers of the Basket Stocks and, in
addition, one or more affiliates of the
Company may publish research reports with
respect to one or more of the issuers of the
Basket Stocks. The statement in the
preceding sentence is not intended to affect
the rights of holders of the Notes under the
securities laws. Any prospective purchaser
of a Note should undertake an independent
investigation of the issuers of the Basket
Stocks as in its judgment is appropriate to
make an informed decision with respect to an
investment in the Basket Stocks.
Historical Information........ The following table sets forth the high and
low Market Prices of each Basket Stock during
1995, 1996, 1997 and during 1998 through
March 31, 1998. The Market Price of each
Basket Stock on March 31, 1998 is set forth
in the table under "Basket Stocks" above. The
Market Prices listed below were obtained from
Bloomberg Financial Markets. The Company
believes all such information to be accurate.
The historical prices of the Basket Stocks
should not be taken as an indication of
future performance, and no assurance can be
given that the price of the Basket Stocks
will increase sufficiently to cause the
beneficial owners of the Notes to receive an
amount in excess of the principal amount on
any Exchange Date or Call Date.
<TABLE>
Dividends
Ascend High Low per Share
- ------ ---- --- ---------
<S> <C> <C> <C>
(CUSIP # 043491109)
1995
First Quarter........ 12 3/16 9 1/8 --
Second Quarter....... 12 7/16 7 7/8 --
Third Quarter........ 11 1/8 8 5/16 --
Fourth Quarter....... 9 1/4 5 11/16 --
1996
First Quarter........ 9 5 7/16 --
Second Quarter....... 9 1/14 6 1/2 --
Third Quarter........ 7 3/16 5 --
Fourth Quarter....... 7 5/16 5 3/8 --
1997
First Quarter........ 7 5/16 5 1/16 --
Second Quarter....... 6 1/2 5 1/4 --
Third Quarter........ 31 5/8 5 7/8 --
Fourth Quarter....... 26 7/16 16 3/8 --
1998
First Quarter........ 24 3/4 12 5/16 --
</TABLE>
Historical prices have been adjusted for
three 2 for 1 stock splits of Ascend stock,
which became effective in the second quarter
of 1995, the third quarter of 1995 and the
fourth quarter of 1995, respectively.
<TABLE>
Dividends
Ericsson High Low per Share
- -------- ---- ---- ---------
<S> <C> <C> <C>
(CUSIP # 294821400)
1995
First Quarter........ 15 11/64 12 59/64 --
Second Quarter....... 19 13/64 15 1/32 $0.1776
Third Quarter........ 24 23/32 17 49/64 --
Fourth Quarter....... 23 7/8 18 --
1996
First Quarter........ 23 18 1/4 --
Second Quarter....... 23 3/16 18 5/8 $0.2554
Third Quarter........ 25 9/16 18 13/16 --
Fourth Quarter....... 31 1/2 25 1/2 --
1997
First Quarter........ 36 29 3/4 --
Second Quarter....... 40 1/2 29 9/16 $0.324
Third Quarter........ 48 3/16 38 9/16 --
Fourth Quarter....... 49 15/16 34 11/16 --
1998
First Quarter........ 48 3/8 34 13/16 --
</TABLE>
Historical prices have been adjusted for one
4 for 1 stock split of Ericsson stock, which
became effective in the second quarter of
1995, and for a rights issuance in the fourth
quarter of 1995 whereby one right was issued
for each American depositary receipt ("ADR")
held and each right entitled the holder to
purchase one ADR for 90 Swedish Krona.
<TABLE>
Dividends
Lucent High Low per Share
- ------ ---- --- ---------
<S> <C> <C> <C>
(CUSIP # 549463107)
1996
Second Quarter....... 39 1/8 30 5/8 --
Third Quarter........ 45 7/8 33 7/8 $0.075
Fourth Quarter....... 52 1/2 43 $0.075
1997
First Quarter........ 59 5/8 45 1/4 $0.075
Second Quarter....... 73 1/8 50 1/4 $0.075
Third Quarter........ 88 11/16 73 7/16 $0.075
Fourth Quarter....... 89 72 15/16 $0.075
1998
First Quarter........ 127 7/8 74 3/4 $0.075
</TABLE>
Lucent made an intial public offering of its
stock on April 4, 1996. Historical prices
have been adjusted for one 2 for 1 stock
split of Lucent stock which became effective
in the first quarter of 1998.
<TABLE>
Dividends
Nokia High Low per Share
- ----- ---- --- ---------
<S> <C> <C> <C>
(CUSIP # 654902204)
1995
First Quarter........ 40 11/16 35 9/16 --
Second Quarter....... 60 3/8 36 15/16 $0.5823
Third Quarter........ 76 3/8 59 1/2 --
Fourth Quarter....... 68 7/8 32 3/4 --
1996
First Quarter........ 40 34 --
Second Quarter....... 43 1/2 31 3/4 $0.6330
Third Quarter........ 45 32 3/4 --
Fourth Quarter....... 58 3/4 44 --
1997
First Quarter........ 67 1/8 56 1/2 --
Second Quarter....... 75 5/16 56 1/8 $0.6866
Third Quarter........ 93 13/16 72 3/4 --
Fourth Quarter....... 101 3/4 64 1/2 --
1998
First Quarter........ 108 68 1/8 --
</TABLE>
Historical prices have been adjusted for one
2 for 1 stock split of Nokia stock, which
became effective in the second quarter of
1995.
<TABLE>
Dividends
Tellabs High Low per Share
- ------- ---- --- ---------
<S> <C> <C> <C>
(CUSIP # 879664100)
1995
First Quarter........ 15 3/4 11 31/32 --
Second Quarter....... 24 1/16 14 3/16 --
Third Quarter........ 25 1/2 20 1/2 --
Fourth Quarter....... 21 15 1/2 --
1996
First Quarter........ 25 7/8 16 1/2 --
Second Quarter....... 33 7/16 24 1/4 --
Third Quarter........ 37 1/2 26 3/8 --
Fourth Quarter....... 45 1/4 34 7/16 --
1997
First Quarter........ 45 7/8 34 1/8 --
Second Quarter....... 57 7/16 34 --
Third Quarter........ 63 51 1/2 --
Fourth Quarter....... 58 5/8 45 1/8 --
1998
First Quarter........ 68 3/4 45 13/16 --
</TABLE>
Historical prices have been adjusted for two
2 for 1 stock splits of Tellabs stock, which
became effective in the second quarter of 1995
and the fourth quarter of 1996, respectively.
<TABLE>
Dividends
WorldCom High Low per Share
- -------- ---- --- ---------
<S> <C> <C> <C>
(CUSIP # 879664100)
1995
First Quarter........ 12 7/8 9 11/16 --
Second Quarter....... 13 5/8 11 11/16 --
Third Quarter........ 16 15/16 13 1/2 --
Fourth Quarter....... 17 5/8 15 5/32 --
1996
First Quarter........ 23 16 1/2 --
Second Quarter....... 27 11/16 21 3/4 --
Third Quarter........ 28 18 5/8 --
Fourth Quarter....... 26 1/16 21 5/8 --
1997
First Quarter........ 27 1/2 22 --
Second Quarter....... 32 21 7/8 --
Third Quarter........ 37 29 15/16 --
Fourth Quarter....... 38 1/16 28 15/16 --
1998
First Quarter........ 44 7/16 28 13/16 --
</TABLE>
Historical prices have been adjusted for one
2 for 1 stock split of WorldCom stock which
became effective in the second quarter of
1996.
The Company makes no representation as to the
amount of dividends, if any, that any of the
issuers of the Basket Stocks will pay in the
future. In any event, holders of the Notes
will not be entitled to receive dividends, if
any, that may be payable on the Basket Stocks.
Use of Proceeds and Hedging... The net proceeds to be received by the
Company from the sale of the Notes will be
used for general corporate purposes and, in
part, by the Company or one or more of its
affiliates in connection with hedging the
Company's obligations under the Notes. See
also "Use of Proceeds" in the accompanying
Prospectus.
On the date of this Pricing Supplement, the
Company, through its subsidiaries and others,
hedged its anticipated exposure in connection
with the Notes by taking positions in the
Basket Stocks and other instruments in
connection with such hedging. Such hedging
was carried out in a manner designed to
minimize any impact on the prices of the
Basket Stocks. Purchase activity could
potentially have increased the prices of the
Basket Stocks, and therefore effectively have
increased the levels to which the Basket
Stocks must rise before a holder of a Note
would receive more than the accreted principal
amount on any Exchange Date or Call Date.
Although the Company has no reason to believe
that its hedging activity had a material
impact on the prices of the Basket Stocks or
such options, there can be no assurance that
the Company did not, or in the future will
not, affect such prices as a result of its
hedging activities. The Company, through its
subsidiaries, is likely to modify its hedge
positions throughout the life of the Notes by
purchasing and selling the Basket Stocks,
options contracts on the Basket Stocks listed
on major securities markets or positions in
any other instruments that it may wish to use
in connection with such hedging.
United States Federal
Taxation...................... The Notes are Optionally Exchangeable Notes
and investors should refer to the discussion
under "United States Federal
Taxation--Notes--Optionally Exchangeable
Notes" in the accompanying Prospectus
Supplement. In connection with the
discussion thereunder, the Company has
determined that the "comparable yield" is an
annual rate of 6.1%, compounded semi-
annually. Based on the Company's
determination of the comparable yield, the
"projected payment schedule" for a Note
(assuming a par amount of $1,000 or with
respect to each integral multiple thereof)
consists of the semi-annual coupon payments
and an additional projected amount due at
maturity, equal to $1,443,89.
THE COMPARABLE YIELD AND THE PROJECTED
PAYMENT SCHEDULE ARE NOT PROVIDED FOR ANY
PURPOSE OTHER THAN THE DETERMINATION OF
UNITED STATES HOLDERS' INTEREST ACCRUALS AND
ADJUSTMENTS THEREOF IN RESPECT OF THE NOTES
AND DO NOT CONSTITUTE A REPRESENTATION
REGARDING THE ACTUAL AMOUNTS OF THE PAYMENTS
ON A NOTE.
ANNEX A
OFFICIAL NOTICE OF EXCHANGE
Dated: [On or after July 6, 1998]
Morgan Stanley Dean Witter & Co.
1585 Broadway
New York, New York 10036
Morgan Stanley & Co. Incorporated, as
Calculation Agent
1585 Broadway
New York, New York 10036
Fax No.: (212) 761-0674
(Attn: Lily Lam)
Dear Sirs:
The undersigned holder of the Medium Term Notes, Series C,
Senior Fixed Rate Notes due April 15, 2005 (Exchangeable for Shares of Common
Stock of Six Telecommunications Corporations (the "Basket Stocks")) of Morgan
Stanley Dean Witter & Co. (the "Notes") hereby irrevocably elects to exercise
with respect to the principal amount of the Notes indicated below, as of the
date hereof (or, if this letter is received after 11:00 a.m. on any Trading
Day, as of the next Trading Day), provided that such day is prior to the
earliest of (i) April 14, 2005, (ii) the Call Date and (iii) in the event of a
call for cash, the Company Notice Date, the Exchange Right as described in
Pricing Supplement No. 4 dated March 31, 1998 (the "Pricing Supplement") to
the Prospectus Supplement dated March 26, 1998 and the Prospectus dated March
26, 1998 related to Registration Statement No. 333-46935. Capitalized terms
not defined herein have the meanings given to such terms in the Pricing
Supplement. Please date and acknowledge receipt of this notice in the place
provided below on the date of receipt, and fax a copy to the fax number
indicated, whereupon the Company will deliver, at its sole option, shares of
the Basket Stocks or cash 3 Business Days after the Exchange Date in
accordance with the terms of the Notes, as described in the Pricing Supplement.
Very truly yours,
_______________________________________
[Name of Holder]
By:____________________________________
[Title]
_______________________________________
[Fax No.]
$_______________________________________
Principal Amount of Notes surrendered
for exchange
Receipt of the above Official
Notice of Exchange is hereby acknowledged
MORGAN STANLEY DEAN WITTER & CO., as Issuer
MORGAN STANLEY & CO. INCORPORATED, as Calculation Agent
By MORGAN STANLEY & CO. INCORPORATED, as Calculation Agent
By:____________________________________
Title:
Date and time of acknowledgment________
