PROSPECTUS Dated May 5, 1999 Pricing Supplement No. 27 to
PROSPECTUS SUPPLEMENT Registration Statement No. 333-75289
Dated May 6, 1999 Dated October 14, 1999
Rule 424(b)(3)
$28,500,000
Morgan Stanley Dean Witter & Co.
MEDIUM-TERM NOTES, SERIES C
Senior Fixed Rate Notes
------------
Exchangeable Notes due October 19, 2006
Exchangeable for Shares of Common Stock of
ORACLE CORPORATION
------------
The notes will not pay any interest but will be issued at a discount and thus
have a minimum yield to maturity of 0.25%. Beginning January 19, 2000, you will
be able to exchange your notes for a number of shares of Oracle common stock,
subject to our right to call all of the notes on or after October 19, 2001.
o The price of each note is $982.66 (98.266% of the $1,000 principal amount
at maturity). This issue price represents a yield to maturity of 0.25% per
year compounded semi-annually.
o We will not make any coupon interest payments on the notes.
o Beginning January 19, 2000, you will have the right to exchange each note
for 17.3241 shares of Oracle common stock. If you exchange, we will have
the right to deliver either the actual shares or the cash value of such
shares to you. You will not receive any accrued original issue discount.
o Beginning October 19, 2001, we have the right to call all of the notes and
pay to you the call price, which will be an amount per note equal to the
issue price of $982.66 plus accrued original issue discount, or OID, to the
call date. However, if the market value of 17.3241 shares of Oracle common
stock on the last trading day before we send our call notice is equal to or
greater than the call price, we will deliver to you 17.3241 shares of
Oracle common stock per note instead.
o If we decide to call the notes, we will give you notice at least 30 but not
more than 60 days before the call date specified in the notice. If we
notify you that we will be delivering shares of Oracle common stock on the
call date, rather than the cash call price, you will still be able to
exercise your exchange right on any day prior to the call date.
o If you hold the notes to maturity, we will pay $1,000 per note to you.
o Oracle Corporation is not involved in this offering of the notes in any way
and will have no financial obligation with respect to the notes.
o We will apply to list the notes to trade under the proposed symbol "MSORCL
ZR06" on the New York Stock Exchange, Inc.
You should read the more detailed description of the notes in this pricing
supplement. In particular, you should review and understand the descriptions in
"Summary of Pricing Supplement" and "Description of Notes."
The notes involve risks not associated with an investment in conventional debt
securities. See "Risk Factors" beginning on PS-6.
---------------
PRICE 98.266%
---------------
Proceeds
Price to Public Agent's Commissions to Company
--------------- ------------------- ----------
Per Note................. 98.266% 0.25% 98.016%
Total.................... $28,005,810 $71,250 $27,934,560
MORGAN STANLEY DEAN WITTER
<PAGE>
(This page intentionally left blank)
PS-2
<PAGE>
SUMMARY OF PRICING SUPPLEMENT
The following summary describes the notes we are offering to you in
general terms only. You should read the summary together with the more detailed
information that is contained in the rest of this pricing supplement and in the
accompanying prospectus and prospectus supplement. You should carefully
consider, among other things, the matters set forth in "Risk Factors."
The Notes
Each note costs $982.66 We, Morgan Stanley Dean Witter & Co., are
offering you Exchangeable Notes due October 19,
2006, which you may exchange for Oracle
Corporation common stock beginning on January 19,
2000. The price of each note is $982.66 (98.266%
of the $1,000 principal amount at maturity). We
refer to Oracle Corporation common stock as
Oracle Stock. We will not pay interest on the
notes. If you hold the notes to maturity, which
is October 19, 2006, we will pay $1,000 per note
to you. This payment represents the $982.66 issue
price plus a yield to maturity of 0.25% per year
compounded semi-annually.
Your Exchange Right
The exchange ratio Beginning January 19, 2000, you may exchange each
is 17.3241 note for a number of shares of Oracle Stock equal
to the exchange ratio. The exchange ratio is
17.3241 shares of Oracle Stock per note, subject
to adjustment for certain corporate events
relating to Oracle Corporation, which we refer to
as Oracle. When you exchange your notes, Morgan
Stanley & Co. Incorporated or its successors,
which we refer to as MS & Co., acting as
calculation agent, will determine the exact
number of shares you will receive based on the
principal amount of the notes you exchange and
the exchange ratio as it may have been adjusted
through the time of the exchange.
To exchange a note on any day, you must instruct
your broker or other person with whom you hold
your notes to take the following steps through
normal clearing system channels:
o fill out an Official Notice of Exchange, which
is attached as Annex A to this pricing
supplement;
o deliver your Official Notice of Exchange to us
before 11:00 a.m. (New York City time) on that
day; and
o deliver your note certificate to The Chase
Manhattan Bank, as trustee for our senior
notes, on that day.
If you give us your Official Notice of Exchange
after 11:00 a.m. (New York City time) on any day
or at any time on a day when the stock markets
are closed, your notice will not become effective
until the next day that the stock markets are
open.
We can choose to pay to We will pay to you, at our option, within 3
you cash or Oracle Stock business days after you give us your Official
if you elect to exchange Notice of Exchange, either:
your notes
o shares of Oracle Stock, or
o the cash value of such shares.
PS-3
<PAGE>
We will not pay any accrued original issue
discount if you elect to exchange your notes.
Our right to call the notes may affect your
ability to exchange your notes.
Our Call Right Beginning October 19, 2001, we have the right to
call all of the notes. If we call the notes, we
will do the following:
o send a notice announcing that we have decided
to call the notes;
o specify in the notice a call date when you
will receive payment in exchange for
delivering your notes to the trustee; that
call date will not be less than 30 or more
than 60 days after the date of the notice; and
o specify in the notice the number of shares of
Oracle Stock or the cash call price that we
will pay to you in exchange for each note, as
explained in the next paragraph.
We may call the notes for On the last trading day before the date of our
stock or cash, depending call notice, the calculation agent will determine
on the price of Oracle Stock the value of the shares of Oracle Stock that a
noteholder would receive upon exchange of a note.
That value is referred to as parity. If parity is
less than the call price (the sum of the issue
price of $982.66 plus the yield that will have
accrued on the note to the call date), then we
will pay the call price to you in cash. If we
notify you that we will give you cash on the call
date, you will no longer be able to exercise your
exchange right.
If, however, parity as so determined is equal to
or greater than the call price, then we will
deliver the shares of Oracle Stock instead. In
that case, you will still have the right to
exercise your exchange right on any day prior to
the call date.
Oracle Stock is The last reported sales price of Oracle Stock on
currently $46 25/32 a share the Nasdaq National Market on the date of this
pricing supplement was $46 25/32. You can review
the publicly-reported prices of Oracle Stock for
the last three years in the "Historical
Information" section of this pricing supplement.
The Calculation Agent We have appointed MS & Co. to act as calculation
agent for The Chase Manhattan Bank, the trustee
for our senior notes. As calculation agent, MS &
Co. will determine the exchange ratio and
calculate the amount of Oracle Stock or cash that
you receive if you exercise your exchange right
or if we call the notes. As calculation agent, MS
& Co. will also adjust the exchange ratio for
certain corporate events that could affect the
price of the Oracle Stock and that we describe in
the section called "Description of
Notes--Antidilution Adjustments" in this pricing
supplement.
No Affiliation with Oracle is not an affiliate of ours and is not
Oracle involved with this offering in any way. The notes
are obligations of Morgan Stanley Dean Witter &
Co. and not of Oracle.
More Information The notes are senior notes issued as part of our
on the Notes Series C medium-term note program. You can find a
general description of our Series C medium-term
note program in the accompanying prospectus
supplement dated May 6, 1999. We describe the
basic features of this type of note in the
sections called "Description of Notes--Fixed Rate
Notes" and "--Exchangeable Notes."
PS-4
<PAGE>
Because this is a summary, it does not contain
all of the information that may be important to
you, including the specific requirements for the
exercise of your exchange right and of our call
right. You should read the "Description of Notes"
section in this pricing supplement for a detailed
description of the terms of the notes. You should
also read about some of the risks involved in
investing in the notes in the section called
"Risk Factors." We urge you to consult with your
investment, legal, accounting and other advisors
with regards to any investment in the notes.
How to reach us You may contact us at our principal executive
offices at 1585 Broadway, New York, New York
10036 (telephone number (212) 761-4000).
PS-5
<PAGE>
RISK FACTORS
The notes are not secured debt and are riskier than ordinary debt
securities. This section describes the most significant risks relating to the
notes. You should carefully consider whether the notes are suited to your
particular circumstances before you decide to purchase them.
Yield to Maturity Less Than These notes have a yield to maturity of 0.25%
Interest on Ordinary Notes per based on the issue price of Interest on
Ordinary Notes $982.66 and computed on a
semi-annual bond-equivalent basis. This yield
to maturity is lower than the rate of interest
that we would pay on non-exchangeable senior
notes maturing at the same time as the notes.
If you exchange your notes for Oracle Stock,
you will not receive accrued original issue
discount.
Notes May Not Be There may be little or no secondary market for
Actively Traded the notes. Although we will apply to list the
notes on the New York Stock Exchange, Inc.,
the listing has not been approved. Even if
there is a secondary market, it may not
provide enough liquidity to allow you to trade
or sell the notes easily. MS & Co. currently
intends to act as a market maker for the
notes, but is not required to do so.
Market Price of Notes Several factors, many of which are beyond our
Influenced by Many control, will influence the value of the
Unpredictable Factors notes, including:
o the market price of Oracle Stock
o the volatility (frequency and magnitude of
changes in price) of the Oracle Stock
o the dividend rate on the Oracle Stock
o economic, financial, political and
regulatory or judicial events that affect
stock markets generally and which may
affect the market price of the Oracle Stock
o interest and yield rates in the market
o the time remaining until (1) you can
exchange your notes for stock, (2) we can
call the notes and (3) the notes mature
o our creditworthiness
These factors will influence the price that
you will receive if you sell your notes prior
to maturity. For example, you may have to sell
your notes at a substantial discount from the
issue price if the market price of the Oracle
Stock is at, below or not sufficiently above
the price of Oracle Stock at pricing.
You cannot predict the future performance of
Oracle Stock based on its historical
performance.
PS-6
<PAGE>
No Affiliation with We are not affiliated with Oracle. We or our
Oracle subsidiaries may presently or from time to
time engage in business with Oracle, including
extending loans to, or making equity
investments in, Oracle or its affiliates or
subsidiaries or providing investment advisory
services to Oracle, including merger and
acquisition advisory services. In the course
of our business, we or our affiliates may
acquire non-public information about Oracle.
Moreover, we have no ability to control or
predict the actions of Oracle, including any
corporate actions of the type that would
require the calculation agent to adjust the
exchange ratio. Oracle is not involved in the
offering of the notes in any way and has no
obligation to consider your interest as an
owner of these notes in taking any corporate
actions that might affect the value of your
notes. None of the money you pay for the notes
will go to Oracle.
You Have No As an owner of notes, you will not have voting
Shareholder Rights rights or the right receive dividends or other
distributions or any other rights with respect
to Oracle Stock.
Limited Antidilution MS & Co., as calculation agent, will adjust
Adjustments the exchange ratio for certain events
affecting the Oracle Stock, such as stock
splits and stock dividends, and certain
other corporate actions involving Oracle, such
as mergers. However, the calculation agent is
not required to make an adjustment for every
corporate event that can affect Oracle Stock.
For example, the calculation agent is not
required to make any adjustments if Oracle or
anyone else makes a partial tender offer or a
partial exchange offer for Oracle Stock. If an
event occurs that does not require the
calculation agent to adjust the exchange rate,
the market price of the notes may be
materially and adversely affected. In
addition, the calculation agent may, but is
not required to, make adjustments for
corporate events that can affect the Oracle
Stock other than those contemplated in this
pricing supplement. Such adjustments will be
made to reflect the consequences of events but
not with the aim of changing relative
investment risk. The determination by the
calculation agent to adjust, or not to adjust,
the exchange ratio may materially and
adversely affect the market price of the
notes.
Potential Conflicts of As calculation agent, MS & Co. will calculate
Interest between You how many shares of Oracle Stock you will
and the Calculation receive in exchange for your notes and what
Agent and Other adjustments should be made to the exchange
Affiliates of Ours ratio to reflect certain corporate and other
events. MS & Co. and other affiliates may
carry out hedging activities related to the
notes or to other instruments, including
trading in Oracle Stock as well as in other
instruments related to Oracle Stock. MS & Co.
and some of our subsidiaries also trade Oracle
Stock on a regular basis as part of their
general broker-dealer businesses. We or our
subsidiaries may issue other securities linked
to Oracle Stock. Any of these activities and
MS & Co.'s affiliation with us could influence
MS & Co.'s determinations as calculation
agent, including with respect to adjustments
to the exchange ratio, and, accordingly, the
amount of stock or cash that you receive when
you exchange the notes or when we call the
notes. In addition, such trading activity
could potentially affect the price of Oracle
Stock and, thereby, the value of the Oracle
Stock or cash you will receive upon exchange
or redemption.
PS-7
<PAGE>
Tax Treatment You should also consider the tax consequences
of investing in the notes. If you are a U.S.
taxable investor, you will be subject to
annual income tax based on the comparable
yield of the notes, even though you will not
receive any periodic interest payments and at
maturity may only receive the return of the
principal amount of the notes. In addition,
any gain recognized by U.S. taxable investors
on the sale, exchange or retirement of the
notes will be treated as ordinary income.
Please read carefully the section "Description
of Notes--United States Federal Taxation" in
this pricing supplement and the section
"United States Federal
Taxation--Notes--Optionally Exchangeable
Notes" in the accompanying prospectus
supplement.
PS-8
<PAGE>
DESCRIPTION OF NOTES
Terms not defined herein have the meanings given to such terms in the
accompanying prospectus supplement. The term "Note" refers to each $982.66 issue
price of our Exchangeable Notes due October 19, 2006 (Exchangeable for Shares of
Common Stock of Oracle Corporation). In this pricing supplement, the terms
"MSDW," "we," "us" and "our" refer to Morgan Stanley Dean Witter & Co.
Principal Amount.......................... $28,500,000
Maturity Date............................. October 19, 2006
Specified Currency........................ U.S. Dollars
Issue Price............................... $982.66 (98.266% of the principal
amount at maturity)
Stated OID................................ 0.25% per annum computed on a
semi-annual bond-equivalent basis
Original Issue Date (Settlement Date)..... October 19, 1999
CUSIP..................................... 617446DP1
Minimum Denominations..................... $1,000
Exchange Right............................ On any Exchange Date, you will be
entitled upon (i) your completion
and delivery to us 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 your Notes to the Trustee,
to exchange each Note for 5.59283
shares (the "Exchange Ratio") of
Oracle Stock, subject to adjustment
as described under "--Antidilution
Adjustments" below. You will not,
however, be entitled to exchange
your Notes if we have previously
called the Notes for the cash Call
Price as described under "--MSDW
Call Right" below.
Upon any such exchange, we may, at
our sole option, either deliver such
shares of Oracle Stock or pay an
amount in cash equal to the Exchange
Ratio times the Market Price of
Oracle Stock on the Exchange Date,
as determined by the Calculation
Agent, in lieu of such shares. 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, you will not be entitled to
any cash payment representing any
accrued Stated OID. Such accrued
Stated OID will be deemed paid by
the Oracle Stock or cash received by
you upon exercise of the Exchange
Right.
We will, or will cause the
Calculation Agent to, deliver such
shares of Oracle Stock or cash to
the Trustee for delivery to you.
No Fractional Shares ..................... If upon any exchange of the Notes we
deliver shares of Oracle Stock, we
will pay cash in lieu of delivering
fractional shares of Oracle
PS-9
<PAGE>
Stock in an amount equal to the
corresponding fractional Market
Price of Oracle Stock as determined
by the Calculation Agent on such
Exchange Date.
Exchange Ratio ........................... 17.3241, subject to adjustment for
certain corporate events relating to
Oracle. See "--Antidilution
Adjustments" below.
Exchange Date............................. Any Trading Day that falls during
the period beginning January 19,
2000 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 the cash
Call Price as described under
"--MSDW Call Right" below, the MSDW
Notice Date.
MSDW Call Right .......................... On or after October 19, 2001, we may
call the Notes, in whole but not in
part, for mandatory exchange into
Oracle Stock at the Exchange Ratio;
provided that, if Parity on the
Trading Day immediately preceding
the MSDW Notice Date, as determined
by the Calculation Agent, is less
than the applicable Call Price for
the Call Date specified in our
Notice of mandatory exchange, we
will (under those circumstances
only) pay such applicable Call Price
in cash on the Call Date. If we call
the Notes for mandatory exchange,
then, unless you subsequently
exercise the Exchange Right (the
exercise of which will not be
available to you following a call
for cash in an amount equal to the
Call Price), the Oracle Stock or (in
the event of a call for cash, as
described above) cash to be
delivered to you will be delivered
on the Call Date fixed by us and set
forth in our notice of mandatory
exchange, upon delivery of your
Notes to the Trustee. We will, or
will cause the Calculation Agent to,
deliver such shares of Oracle Stock
or cash to the Trustee for delivery
to you.
Upon an exchange by us (whether
payment is to be made in Oracle
Stock or by payment of the cash Call
Price, as applicable), you will not
receive any additional cash payment
representing any accrued Stated OID.
Such accrued Stated OID will be
deemed paid by the delivery of
Oracle Stock or cash.
On or after the MSDW Notice Date
(other than with respect to a call
of the Notes for the cash Call Price
by us) you will continue to be
entitled to exercise the Exchange
Right and receive any amounts
described under "--Exchange Right"
above.
MSDW Notice Date.......................... The scheduled Trading Day on which
we issue our notice of mandatory
exchange, which must be at least 30
but no more than 60 days prior to
the Call Date.
Call Date................................. The scheduled Trading Day on or
after October 19, 2001 specified by
us in our notice of mandatory
exchange on which we will deliver
Oracle Stock or cash to holders of
the Notes for mandatory exchange.
PS-10
<PAGE>
Parity.................................... With respect to any Trading Day, an
amount equal to the Exchange Ratio
times the Market Price (as defined
below) of Oracle Stock on such
Trading Day.
Call Price................................ The table below shows indicative
Call Prices for each $1,000
principal amount of Notes on October
19, 2001 and at each October 19
thereafter to and including the
Maturity Date. The Call Price for
each $1,000 principal amount of
Notes called for mandatory exchange
on Call Dates between such
indicative dates would include an
additional amount reflecting Stated
OID accrued from the next preceding
date in the table through the
applicable Call Date at a rate of
0.25% per annum. Such additional
accreted amount of Stated OID will
be determined by the Calculation
Agent and will be calculated on a
semiannual bond-equivalent basis
based on the Call Price for the
immediately preceding Call Date
indicated in the table below.
Call Date Call Price
--------- ----------
October 19, 2001..........$ 987.59
October 19, 2002......... $ 990.06
October 19, 2003......... $ 992.53
October 19, 2004......... $ 995.02
October 19, 2005......... $ 997.50
Maturity................. $ 1,000.00
Market Price.............................. If Oracle Stock (or any other
security for which a Market Price
must be determined) is listed on a
national securities exchange, is a
security of the Nasdaq National
Market 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 Oracle
Stock (or one unit of any such other
security) 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
modified (the "Exchange Act"), on
which Oracle Stock (or any such
other security) 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 (even if Oracle Stock (or
other such security) is listed or
admitted to trading on such
securities exchange), the last
reported sale price on the over-the-
counter market as reported on the
Nasdaq National Market 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
because of a Market Disruption Event
or otherwise, the Market Price for
any Trading Day shall be the mean,
as determined by the Calculation
Agent, of the bid prices for Oracle
Stock (or any such other security)
obtained from as many dealers in
such security (which may include MS
& Co. or any of our other
subsidiaries or affiliates), but not
exceeding three, as will make such
bid prices available to the
Calculation Agent. A "security of
the Nasdaq National Market" 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, as determined by the
Calculation Agent, on which trading
is generally conducted on the New
York Stock Exchange, Inc. ("NYSE"),
the American Stock Exchange, Inc.,
the Nasdaq National
PS-11
<PAGE>
Market, the Chicago Mercantile
Exchange, the Chicago Board of
Options Exchange and in the
over-the-counter market for equity
securities in the United States and
on which a Market Disruption Event
has not occurred.
Book Entry Note or Certificated Note...... Book Entry, DTC
Senior Note or Subordinated Note.......... Senior
Trustee................................... The Chase Manhattan Bank
Agent for this Underwritten
Offering of Notes......................... MS & Co.
Calculation Agent......................... MS & Co.
All determinations made by the
Calculation Agent will be at the
sole discretion of the Calculation
Agent and will, in the absence of
manifest error, be conclusive for
all purposes and binding on you and
on us.
Because the Calculation Agent is our
affiliate, potential conflicts of
interest may exist between the
Calculation Agent and you as an
owner 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
other antidilution adjustments or
determining the Market Price or
whether a Market Disruption Event
has occurred. See "Antidilution
Adjustments" 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.
Antidilution Adjustments.................. The Exchange Ratio will be adjusted
as follows:
1. If Oracle Stock is subject to a
stock split or reverse stock split,
then once such split has become
effective, the Exchange Ratio will
be adjusted to equal the product of
the prior Exchange Ratio and the
number of shares issued in such
stock split or reverse stock split
with respect to one share of Oracle
Stock.
2. If Oracle Stock is subject (i) to
a stock dividend (issuance of
additional shares of Oracle Stock)
that is given ratably to all holders
of shares of Oracle Stock or (ii) to
a distribution of Oracle Stock as a
result of the triggering of any
provision of the corporate charter
of Oracle, then once the dividend
has become effective and Oracle
Stock is trading ex-dividend, the
Exchange Ratio will be adjusted so
that the new Exchange Ratio shall
equal the prior Exchange Ratio plus
the product of (i) the number of
shares issued with respect to one
share of Oracle Stock and (ii) the
prior Exchange Ratio.
3. There will be no adjustments to
the Exchange Ratio to reflect cash
dividends or other distributions
paid with respect to Oracle Stock
other than distributions described
in paragraph 6 below and
PS-12
<PAGE>
Extraordinary Dividends as described
below. A cash dividend or other
distribution with respect to Oracle
Stock will be deemed to be an
"Extraordinary Dividend" if such
dividend or other distribution
exceeds the immediately preceding
non-Extraordinary Dividend for
Oracle Stock (as adjusted for any
subsequent corporate event requiring
an adjustment hereunder, such as a
stock split or reverse stock split)
by an amount equal to at least 10%
of the Market Price of Oracle 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 Oracle Stock, the
Exchange Ratio with respect to
Oracle 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 exdividend 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 Oracle 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
Oracle 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 the Oracle Stock
described in paragraph 6 below that
also constitutes an Extraordinary
Dividend shall only cause an
adjustment to the Exchange Ratio
pursuant to paragraph 6.
4. If Oracle is being liquidated or
is subject to a proceeding under any
applicable bankruptcy, insolvency or
other similar law, the Notes will
continue to be exchangeable into
Oracle Stock so long as a Market
Price for Oracle Stock is available.
If a Market Price is no longer
available for Oracle Stock for
whatever reason, including the
liquidation of Oracle or the
subjection of Oracle to a proceeding
under any applicable bankruptcy,
insolvency or other similar law,
then the value of Oracle Stock will
equal zero for so long as no Market
Price is available.
5. If there occurs any
reclassification or change of Oracle
Stock, including, without
limitation, as a result of the
issuance of tracking stock by
Oracle, or if Oracle 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 Oracle as an entirety or
substantially as an entirety, in
each case as a result of which the
holders of Oracle Stock shall be
entitled to receive stock, other
securities or other property or
assets (including, without
limitation, cash or other classes of
stock of Oracle) ("Exchange
Property") with respect to or in
exchange for
PS-13
<PAGE>
such Oracle Stock, then the holders
of the Notes then outstanding will
be entitled thereafter to exchange
such Notes into the kind and amount
of Exchange Property 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 at the then current Exchange
Ratio for Oracle Stock immediately
prior to any such corporate event,
but without interest thereon.
6. If Oracle issues to all of its
shareholders equity securities of an
issuer other than Oracle (other than
in a transaction described in
paragraph 5 above), then the holders
of the Notes then outstanding will
be entitled to receive such new
equity securities upon exchange of
such Notes. The Exchange Ratio for
such new equity securities will
equal the product of the Exchange
Ratio in effect for Oracle Stock at
the time of the issuance of such new
equity securities times the number
of shares of the new equity
securities issued with respect to
one share of Oracle Stock.
7. No adjustments to the Exchange
Ratio will be required other than
those specified above. However, we
may, at our sole discretion, cause
the Calculation Agent to make
additional changes to the Exchange
Ratio upon the occurrence of
corporate or other similar events
that affect or could potentially
affect market prices of, or
shareholders' rights in, the Oracle
Stock (or other Exchange Property)
but only to reflect such changes,
and not with the aim of changing
relative investment risk.
No adjustments to the 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
hundred-thousandth with five
one-millionths being rounded upward.
The Exchange Ratio will not be
adjusted to take into account the
accrual of Stated OID.
The Calculation Agent shall be
solely responsible for the
determination and calculation of any
adjustments to the Exchange Ratio
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
Ratio upon written request by
any holder of the Notes.
PS-14
<PAGE>
Market Disruption Event................... "Market Disruption Event" means,
with respect to Oracle Stock, the
occurrence or existence of any of
the following events as determined
by the Calculation Agent:
(i) a suspension, absence or
material limitation of trading of
Oracle Stock on the primary
market for Oracle Stock for more
than two hours of trading or
during the one-half hour period
preceding the close of trading in
such market; or a breakdown or
failure in the price and trade
reporting systems of the primary
market for Oracle Stock as a
result of which the reported
trading prices for Oracle Stock
during the last one-half hour
preceding the closing of trading
in such market are materially
inaccurate; or the suspension,
absence or material limitation on
the primary market for trading in
options contracts related to
Oracle Stock, if available,
during the one-half hour period
preceding the close of trading in
the applicable market; 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 MSDW 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 option contract will
not constitute a Market Disruption
Event, (3) limitations pursuant to
NYSE Rule 80A (or any applicable
rule or regulation enacted or
promulgated by the NYSE, 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 shall constitute a
suspension, absence or material
limitation of trading, (4) a
suspension of trading in an options
contract on Oracle Stock by the
primary securities market 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, absence or material
limitation of trading in options
contracts related to Oracle Stock
and (5) a suspension, absence or
material limitation of trading on
the primary securities market on
which options contracts related to
Oracle 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
plus the accrued Stated OID to but
not including the date of
PS-15
<PAGE>
acceleration; provided that if (x)
the holder of a Note has submitted
an Official Notice of Exchange to
MSDW in accordance with the Exchange
Right or (y) we have called the
Notes, other than a call for the
cash Call Price, in accordance with
the MSDW Call 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
Exchange Ratio times the Market
Price of one share of Oracle Stock,
determined by the Calculation Agent
as of the Exchange Date or as of the
date of acceleration, respectively,
and shall not include any accrued
Stated OID 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 MSDW Call 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
applicable Call Price. See "--Call
Price" above.
Oracle Stock;
Public Information........................ Oracle develops, manufacturers,
markets and distributes software for
information management, which helps
corporations manage their
businesses. Oracle Stock 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 Oracle pursuant to the
Exchange Act can be located by
reference to Commission file number
0-14376. In addition, information
regarding Oracle may be obtained
from other sources including, but
not limited to, press releases,
newspaper articles and other
publicly disseminated documents. We
make no representation or warranty
as to the accuracy or completeness
of such information.
This pricing supplement relates only
to the Notes offered hereby and does
not relate to Oracle Stock or other
securities of Oracle. We have
derived all disclosures contained in
this pricing supplement regarding
Oracle from the publicly available
documents described in the preceding
paragraph. Neither we nor the Agent
has participated in the preparation
of such documents or made any due
diligence inquiry with respect to
Oracle in connection with the
offering of the Notes. Neither we
nor the Agent makes any
representation that such publicly
available documents are or any other
publicly available
PS-16
<PAGE>
information regarding Oracle is
accurate or complete. Furthermore,
we cannot give any 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 price of Oracle
Stock (and therefore the Exchange
Ratio) have been publicly disclosed.
Subsequent disclosure of any such
events or the disclosure of or
failure to disclose material future
events concerning Oracle 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 we nor any of our affiliates
makes any representation to you as
to the performance of Oracle Stock.
We and/or our subsidiaries may
presently or from time to time
engage in business with Oracle,
including extending loans to, or
making equity investments in, Oracle
or providing advisory services to
Oracle, including merger and
acquisition advisory services. In
the course of such business, we
and/or our subsidiaries may acquire
non-public information with respect
to Oracle and, in addition, one or
more of our affiliates may publish
research reports with respect to
Oracle. The statement in the
preceding sentence is not intended
to affect the rights of holders of
the Notes under the securities laws.
As a prospective purchaser of a
Note, you should undertake such
independent investigation of Oracle
as in your judgment is appropriate
to make an informed decision with
respect to an investment in Oracle
Stock.
Historical Information.................... The following table sets forth the
published high and low Market Price
during 1996, 1997, 1998 and during
1999 through October 14, 1999. The
Market Price on October 14, 1999 was
$4625/32. We obtained the Market
Prices listed below from Bloomberg
Financial Markets and we believe
such information to be accurate. You
should not take the historical
prices of Oracle Stock as an
indication of future performance. We
cannot give any assurance that the
price of Oracle Stock 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.
Oracle Stock High Low
---- ---
(CUSIP 747525103)
1996
First Quarter................... 16 5/64 11 55/64
Second Quarter.................. 17 9/16 12 19/64
Third Quarter................... 19 25/32 15 43/64
Fourth Quarter.................. 22 7/64 18 9/32
1997
First Quarter................... 19 15/16 15 11/64
Second Quarter.................. 23 43/64 15 43/64
Third Quarter................... 27 27/64 21 25/64
Fourth Quarter.................. 25 1/64 14 1/64
1998
First Quarter................... 21 3/64 12 3/64
Second Quarter.................. 20 59/64 15 13/64
Third Quarter................... 19 27/64 12 45/64
Fourth Quarter.................. 29 43/64 15 29/64
1999
First Quarter................... 40 1/2 25 15/16
Second Quarter.................. 37 1/8 2 17/16
Third Quarter................... 46 3/8 35
Fourth Quarter
(through October 14, 1999).... 47 7/16 44 11/16
PS-17
<PAGE>
Historical prices have been adjusted
for three 3 for 2 stock splits of
Oracle Stock, which became effective
in the second quarter of 1996, the
third quarter of 1997 and the first
quarter of 1999, respectively.
We make no representation as to the
amount of dividends, if any, that
Oracle will pay in the future. In
any event, as an owner of a Note,
you will not be entitled to receive
dividends, if any, that may be
payable on Oracle Stock.
Use of Proceeds and Hedging............... The net proceeds we receive from the
sale of the Notes will be used for
general corporate purposes and, in
part, by us or one or more of our
subsidiaries in connection with
hedging our obligations under the
Notes. See also "Use of Proceeds" in
the accompanying prospectus.
On or prior to the date of this
pricing supplement, we, through our
subsidiaries and others, hedged our
anticipated exposure in connection
with the Notes by taking positions
in Oracle Stock and positions in
other instruments in connection with
such hedging. Such hedging was
carried out in a manner designed to
minimize any impact on the price of
Oracle Stock. Our purchase activity
could potentially have increased the
price of Oracle Stock, and therefore
effectively have increased the level
to which Oracle Stock must rise
before you would receive an amount
of Oracle Stock worth as much or
more than the accreted principal
amount of your Notes on any Exchange
Date or Call Date. Through our
subsidiaries, we are likely to
modify our hedge position throughout
the life of the Notes by purchasing
and selling Oracle Stock, options
contracts on Oracle Stock listed on
major securities markets or
positions in other securities or
instruments that we may wish to use
in connection with such hedging.
Although we have no reason to
believe that our hedging activity or
other trading activities that we, or
any of our affiliates, engaged in or
may engage in has had or will have a
material impact on the price of
Oracle Stock, we cannot give any
assurance that we have not or will
not affect such price as a result of
our hedging or trading activities.
Supplemental Information Concerning
Plan of Distribution...................... In order to facilitate the offering
of the Notes, the Agent may engage
in transactions that stabilize,
maintain or otherwise affect the
price of the Notes or the Oracle
Stock. Specifically, the Agent may
overallot in connection with the
offering, creating a short position
in the Notes for its own account. In
addition, to cover allotments or to
stabilize the price of the Notes,
the Agent may bid for, and purchase,
PS-18
<PAGE>
the Notes or the Oracle Stock in the
open market. See "Use of Proceeds
and Hedging" above.
We have agreed to indemnify the
Agent against certain liabilities
under the Securities Act of 1933, as
amended.
ERISA Matters for Pension Plans And
Insurance Companies....................... We and certain of our subsidiaries
and affiliates, including MS & Co.
and Dean Witter Reynolds Inc.
("DWR"), may each be considered a
"party in interest" within the
meaning of the Employee Retirement
Income Security Act of 1974, as
amended ("ERISA"), or a
"disqualified person" within the
meaning of the Internal Revenue Code
of 1986, as amended (the "Code")
with respect to many employee
benefit plans. Prohibited
transactions within the meaning of
ERISA or the Code may arise, for
example, if the Notes are acquired
by or with the assets of a pension
or other employee benefit plan with
respect to which MS & Co., DWR or
any of their affiliates is a service
provider, unless the Notes are
acquired pursuant to an exemption
from the prohibited transaction
rules.
The acquisition of the Notes may be
eligible for one of the exemptions
noted below if such acquisition:
(a) (i) is made solely with the
assets of a bank collective
investment fund and (ii) satisfies
the requirements and conditions of
Prohibited Transaction Class
Exemption ("PTCE") 91-38 issued by
the Department of Labor ("DOL");
(b) (i) is made solely with assets
of an insurance company pooled
separate account and (ii) satisfies
the requirements and conditions of
PTCE 90-1 issued by the DOL;
(c) (i) is made solely with assets
managed by a qualified professional
asset manager and (ii) satisfies the
requirements and conditions of PTCE
84-14 issued by the DOL;
(d) is made solely with assets of a
governmental plan (as defined in
Section 3(32) of ERISA) which is not
subject to the provisions of Section
401 of the Code;
(e) (i) is made solely with assets
of an insurance company general
account and (ii) satisfies the
requirements and conditions of PTCE
95-60 issued by the DOL; or
(f) (i) is made solely with assets
managed by an in-house asset manager
and (ii) satisfies the requirements
and conditions of PTCE 96-23 issued
by the DOL.
Under ERISA, assets of a pension or
other employee benefit plan may
include assets held in the general
account of an insurance company
which has issued an insurance policy
to such plan or assets of an entity
in which the plan has invested. In
addition to considering the
consequences of holding the Notes,
employee benefit plans subject to
ERISA (or insurance companies deemed
to be
PS-19
<PAGE>
investing ERISA plan assets)
purchasing the Notes should consider
the possible implications of owning
the Oracle Stock. Thus, any
insurance company, pension or
employee benefit plan or entity
holding assets of such a plan
proposing to invest in the Notes
should consult with its legal
counsel prior to such investment.
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, we have determined that
the "comparable yield" is an annual
rate of 7.05%, compounded
semi-annually. Based on our
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 a projected amount due
at maturity, equal to $1,596.01.
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 in respect of the Notes,
and we make no representation
regarding the actual amounts of the
payments on a Note.
PS-20
<PAGE>
ANNEX A
OFFICIAL NOTICE OF EXCHANGE
Dated: [On or after January 19, 2000]
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, Exchangeable Notes due October 19, 2006 (Exchangeable for Shares of
Common Stock of Oracle Corporation) of Morgan Stanley Dean Witter & Co. (CUSIP
No. 617446DP1) (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) October 19,
2006, (ii) the Call Date and (iii) in the event of a call for cash, the MSDW
Notice Date, the Exchange Right as described in Pricing Supplement No. 27 dated
October 14, 1999 (the "Pricing Supplement") to the Prospectus Supplement dated
May 6, 1999 and the Prospectus dated May 5, 1999 related to Registration
Statement No. 333-75289. 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 Morgan Stanley Dean Witter & Co. will
deliver, at its sole option, shares of the common stock of Oracle Corporation 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
-------------------
