PROSPECTUS Dated May 5, 1999 Pricing Supplement No. 11 to
PROSPECTUS SUPPLEMENT Registration Statement No. 333-75289
Dated May 6, 1999 Dated May 27, 1999
Rule 424(b)(3)
$15,900,000
Morgan Stanley Dean Witter & Co.
MEDIUM-TERM NOTES, SERIES C
Senior Fixed Rate Notes
-------------------
Exchangeable Notes due June 5, 2006
Exchangeable for Shares of Common Stock of
CISCO SYSTEMS, INC.
-------------------
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 September 4, 1999, you
will be able to exchange your notes for a number of shares of Cisco common
stock, subject to our right to call all of the notes on or after June 4, 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 September 4, 1999, you will have the right to exchange each note
for 7.3895 shares of Cisco 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 June 4, 2001, we have the right to call all of the notes and pay
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 7.3895 shares of Cisco 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 7.3895 shares of Cisco
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 Cisco 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 you $1,000 per note.
o Cisco 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 "MSCSCO
ZR06" on the New York Stock Exchange, Inc., subject to the NYSE listing
requirements and approval.
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%
------------------
Price to Public Agent's Commissions Proceeds to Company
--------------- ------------------- -------------------
Per Note...... 98.266% 0.25% 98.016%
Total......... $15,624,294 $39,750 $15,584,544
MORGAN STANLEY DEAN WITTER
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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 June 5,
2006, which you may exchange for Cisco Systems,
Inc. common stock ("Cisco Stock") beginning on
September 4, 1999. The price of each note is
$982.66 (98.266% of the $1,000 principal amount
at maturity). We will not pay interest on the
notes. If you hold the notes to maturity, which
is June 5, 2006, we will pay you $1,000 per
note. 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 September 4, 1999, you may exchange
is 7.3895 each note for a number of shares of Cisco Stock
equal to the exchange ratio. The exchange ratio
is 7.3895 shares of Cisco Stock per note,
subject to adjustment for certain corporate
events relating to Cisco Systems, Inc.
("Cisco"). When you exchange your notes, Morgan
Stanley & Co. Incorporated ("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 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 you cash We will pay you, at our option, within 3
or Cisco Stock if you elect to business days after you give us your
exchange your notes Official Notice of Exchange, either:
o shares of Cisco Stock, or
o the cash value of such shares.
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 June 4, 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
Cisco Stock or the cash call price that we
will pay you in exchange for each note, as
explained in the next paragraph.
We may call the notes On the last trading day before the date of our
for stock or cash, call notice, the calculation agent will
depending on the price of determine the value of the shares of Cisco
Cisco Stock 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 Cisco Stock instead. In
that case, you will still have the right to
exercise your exchange right on any day prior
to the call date.
Cisco Stock is currently The last reported sales price of Cisco Stock on
$108 a share the Nasdaq National Market on the date of this
Pricing Supplement was $108. You can review the
publicly-reported prices of Cisco 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
Cisco 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 Cisco
Stock and that we describe in the section
called "Description of Notes--Antidilution
Adjustments" in this Pricing Supplement.
No Affiliation with Cisco is not an affiliate of ours and is not
Cisco involved with this offering in any way. The
notes are obligations of Morgan Stanley Dean
Witter & Co. and not of Cisco.
More Information The notes are senior notes issued as part of
on the Notes our 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."
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. You
should also read about some of the risks
involved in investing in the notes in the
section called "Risk Factors."
How to reach us You may contact Morgan Stanley Dean Witter &
Co. at our principal executive offices at 1585
Broadway, New York, New York 10036 (telephone
number (212) 761-4000).
RISK FACTORS
The notes are not secured 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 year based on the issue price of $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 Cisco 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., we
may not meet the requirements for listing. 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 notes,
Unpredictable Factors including:
o the market price of Cisco Stock
o the volatility (frequency and magnitude of
changes in price) of the Cisco Stock
o the dividend rate on the Cisco Stock
o economic, financial, political and regulatory
or judicial events that affect stock markets
generally and which may affect the market
price of the Cisco 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 Cisco
Stock is at, below or not sufficiently above
the price of Cisco Stock at pricing.
You cannot predict the future performance of
Cisco Stock based on its historical
performance.
No Affiliation with We are not affiliated with Cisco. We do not
Cisco have any non-public information about Cisco as
of the date of this Pricing Supplement,
although we or our affiliates may presently or
from time to time engage in business with
Cisco, including extending loans to, or making
equity investments in, Cisco or providing
investment advisory services to Cisco,
including merger and acquisition advisory
services. Moreover, we have no ability to
control or predict the actions of Cisco,
including any corporate actions of the type
that would require the calculation agent to
adjust the exchange ratio. Cisco is not
involved in the offering of the notes in any
way and has no obligation to consider your
interest as a holder 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 Cisco.
You Have No As a holder of notes, you will not have voting
Shareholder Rights rights or the right to receive dividends or
other distributions or any other rights with
respect to Cisco Stock.
Limited Antidilution MS & Co., as calculation agent, will adjust the
Adjustments exchange ratio for certain events affecting the
Cisco Stock, such as stock splits and stock
dividends, and certain other corporate actions
involving Cisco, such as mergers. However, the
calculation agent is not required to make an
adjustment for every corporate event that can
affect Cisco Stock. For example, the
calculation agent is not required to make any
adjustments if Cisco or anyone else makes a
partial tender offer or a partial exchange
offer for Cisco 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 Cisco
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 and how many shares of Cisco Stock you will receive
the Calculation Agent and in exchange for your notes and what adjustments
Other Affiliates of Ours should be made to the exchange 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 Cisco Stock
as well as in other instruments related to
Cisco Stock. MS & Co. and some of our
subsidiaries also trade Cisco Stock on a
regular basis as part of their general
broker-dealer businesses. 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
Cisco Stock and, thereby, the value of the
Cisco Stock or cash you will receive upon
exchange or redemption.
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.
DESCRIPTION OF NOTES
Capitalized terms not defined herein have the meanings given to
such terms in the accompanying Prospectus Supplement. In this Pricing
Supplement, the "Company," "we," "us" and "our" refer to Morgan Stanley Dean
Witter & Co.
Principal Amount.............. $15,900,000
Maturity Date................. June 5, 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)............. June 4, 1999
CUSIP......................... 617446DK2
Minimum Denominations......... $1,000
Initial Cisco Stock Price..... $108 per share
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 such notes to the Trustee, to
exchange each $1,000 principal amount of the
Exchangeable Notes due June 5, 2006
(Exchangeable for Shares of Common Stock of
Cisco Systems, Inc.) (the "Notes") for 7.3895
shares (the "Exchange Ratio") of Cisco 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
"--Company Call Right" below.
Upon any such exchange, we may, at our sole
option, either deliver such shares of Cisco
Stock or pay an amount in cash equal to the
Exchange Ratio times the Market Price of
Cisco 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 receive any cash
payment representing any accrued Stated OID.
Such accrued Stated OID will be deemed paid
by the Cisco 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 Cisco Stock or
cash to the Trustee for delivery to you.
No Fractional Shares ......... If upon any exchange of the Notes we deliver
shares of Cisco Stock, we will pay cash in
lieu of delivering fractional shares of Cisco
Stock in an amount equal to the corresponding
fractional Market Price of Cisco Stock as
determined by the Calculation Agent on such
Exchange Date.
Exchange Ratio ............... 7.3895, subject to adjustment for certain
corporate events relating to Cisco Systems,
Inc. See "--Antidilution Adjustments" below.
Exchange Date................. Any Trading Day that falls during the period
beginning September 4, 1999 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 "--Company Call Right" below,
the Company Notice Date.
Company Call Right ........... On or after June 4, 2001, we may call the
Notes, in whole but not in part, for
mandatory exchange into Cisco Stock at the
Exchange Ratio; provided that, if Parity on
the Trading Day immediately preceding the
Company 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 Cisco 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
Cisco Stock or cash to the Trustee for
delivery to you.
Upon an exchange by us (whether payment is to
be made in Cisco 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 Cisco Stock or cash.
On or after the Company Notice Date (other
than with respect to a call of the Notes for
the cash Call Price by the Company) you will
continue to be entitled to exercise the
Exchange Right and receive any amounts
described under "--Exchange Right" above.
Company 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 June 4,
2001 specified by us in our notice of
mandatory exchange on which we will deliver
Cisco Stock or cash to holders of the Notes
for mandatory exchange.
Parity........................ With respect to any Trading Day, an amount
equal to the Exchange Ratio times the Market
Price (as defined below) of Cisco Stock on
such Trading Day.
Call Price.................... The table below shows indicative Call Prices
for each $1,000 principal amount of Notes on
June 4, 2001 and at each June 4 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
--------- ----------
June 4, 2001................. $ 987.58
June 4, 2002................. $ 990.05
June 4, 2003................. $ 992.53
June 4, 2004................. $ 995.01
June 4, 2005................. $ 997.50
June 4, 2006................. $ 999.99
Maturity..................... $ 1,000.00
Market Price.................. If Cisco Stock (or any other security for
which a Market Price must be determined) is
listed on a U.S. securities exchange
registered under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), 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 Cisco 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 securities exchange on which Cisco
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 Cisco Stock (or
other such security) is listed or admitted to
trading on such securities exchanges), 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 Cisco 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 NMS" 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 NMS, 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............. Morgan Stanley & Co. Incorporated and its
successors (MS & Co.)
Calculation Agent............. Morgan Stanley & Co. Incorporated and its
successors (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 a holder 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 "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 Cisco 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 Cisco
Stock.
2. If Cisco Stock is subject (i) to a stock
dividend (issuance of additional shares of
Cisco Stock) that is given ratably to all
holders of shares of Cisco Stock or (ii) to a
distribution of Cisco Stock as a result of
the triggering of any provision of the
corporate charter of Cisco, then once the
dividend has become effective and Cisco 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 Cisco
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 Cisco Stock
other than distributions described in paragraph
6 below and Extraordinary Dividends as
described below. A cash dividend or other
distribution with respect to Cisco Stock will
be deemed to be an "Extraordinary Dividend" if
such dividend or other distribution exceeds the
immediately preceding non-Extraordinary
Dividend for Cisco 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 Cisco 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 Cisco Stock,
the Exchange Ratio with respect to Cisco 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 Cisco 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 Cisco 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 Cisco 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 Cisco 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 Cisco Stock so long as a Market Price
for Cisco Stock is available. If a Market
Price is no longer available for Cisco Stock
for whatever reason, including the
liquidation of Cisco or the subjection of
Cisco to a proceeding under any applicable
bankruptcy, insolvency or other similar law,
then the value of Cisco Stock will equal zero
for so long as no Market Price is available.
5. If there occurs any reclassification or
change of Cisco Stock, including, without
limitation, as a result of the issuance of
tracking stock by Cisco, or if Cisco 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 Cisco as an entirety
or substantially as an entirety, in each case
as a result of which the holders of Cisco
Stock shall be entitled to receive stock,
other securities or other property or assets
(including, without limitation, cash or other
classes of stock of Cisco) ("Exchange
Property") with respect to or in exchange for
such Cisco 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 for Cisco Stock immediately prior to
any such corporate event, but without
interest thereon. At such time, no
adjustment will be made to the Exchange Ratio.
6. If Cisco issues to all of its shareholders
equity securities of an issuer other than
Cisco (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
Cisco 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 Cisco 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 Cisco 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.
Market Disruption Event....... "Market Disruption Event" means, with respect
to Cisco Stock:
(i) a suspension, absence or material
limitation of trading of Cisco Stock on
the primary market for Cisco 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 Cisco Stock as a result of which the
reported trading prices for Cisco 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 Cisco 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 our 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 Cisco 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 Cisco Stock and
(5) a suspension, absence or material
limitation of trading on the primary
securities market on which options contracts
related to Cisco 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
acceleration; provided that if (x) the holder
of a Note has submitted an Official Notice of
Exchange to the Company in accordance with
the Exchange Right or (y) the Company has
called the Notes, other than a call for the
cash Call Price, in accordance with the
Company 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 Cisco
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
Company 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.
Cisco Stock;
Public Information............ Cisco Systems, Inc. and its subsidiaries, is
a leader in networking for the Internet and
creates hardware and software solutions that
link computer networks so that people have
easy access to information without regard to
differences in time, place or type of computer
system. Cisco 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
Cisco pursuant to the Exchange Act can be
located by reference to Commission file
number 0-18225. In addition, information
regarding Cisco 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 reports.
This pricing supplement relates only to the
Notes offered hereby and does not relate to
Cisco Stock or other securities of Cisco.
We have derived all disclosures contained in
this pricing supplement regarding Cisco 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 Cisco in connection
with the offering of the Notes. Neither we
nor the Agent makes any representation that
such publicly available documents or any
other publicly available information
regarding Cisco are 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 Cisco Stock (and therefore
the Initial Cisco Price and 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 Cisco 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 Cisco Stock.
We or our affiliates may presently or from
time to time engage in business with Cisco,
including extending loans to, or making equity
investments in, Cisco or providing advisory
services to Cisco, including merger and
acquisition advisory services. In the course
of such business, we or our affiliates may
acquire non-public information with respect
to Cisco and, in addition, one or more of our
affiliates may publish research reports with
respect to Cisco. 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 Cisco as in your
judgment is appropriate to make an informed
decision with respect to an investment in
Cisco Stock.
Historical Information........ The following table sets forth the published
high and low Market Price during 1996, 1997,
1998 and during 1999 through May 27, 1999.
The Market Price on May 27, 1999 was $108.
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
Cisco Stock as an indication of future
performance. We cannot give any assurance
that the price of Cisco 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
Cisco High Low
----- ---- ---
(CUSIP 17275R102)
1996
First Quarter................. 22 7/32 14 17/32
Second Quarter................ 25 7/16 19 11/16
Third Quarter................. 28 11/64 20 15/16
Fourth Quarter................ 30 1/2 25 39/64
1997
First Quarter................. 33 9/32 20 15/16
Second Quarter................ 31 27/64 20 39/64
Third Quarter................. 36 27/64 30 23/64
Fourth Quarter................ 40 3/16 32 23/64
1998
First Quarter................. 46 3/8 36 11/64
Second Quarter................ 61 3/8 44 21/64
Third Quarter................. 69 19/64 54 37/64
Fourth Quarter................ 96 1/2 43 7/8
1999
First Quarter................. 115 95 1/8
Second Quarter
(through May 27, 1999)...... 118 3/4 100
Historical prices have been adjusted for a 2
for 1 stock split of Cisco Stock, which
became effective in the first quarter of
1996, and two 3 for 2 stock splits of Cisco
Stock, which became effective in the fourth
quarter of 1997 and the third quarter of
1998, respectively. A 2 for 1 stock split of
Cisco Stock, which was declared in the second
quarter of 1999, is expected to become
effective in the second quarter of 1999
subsequent to the date of this pricing
supplement.
We make no representation as to the amount of
dividends, if any, that Cisco will pay in the
future. In any event, as a holder of a Note,
you will not be entitled to receive
dividends, if any, that may be payable on
Cisco 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 affiliates 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 Cisco 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 Cisco Stock. Our purchase activity could
potentially have increased the price of Cisco
Stock, and therefore effectively have
increased the level to which Cisco Stock must
rise before you would receive an amount of
Cisco 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 Cisco Stock,
options contracts on Cisco 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 Cisco
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 Cisco 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, the Notes or the Cisco 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 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
investing ERISA plan assets) purchasing the
Notes should consider the possible
implications of owning the Cisco 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 6.42%, 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 $1529.62.
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.
ANNEX A
OFFICIAL NOTICE OF EXCHANGE
Dated: [On or after September 4, 1999]
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 June 5, 2006 (Exchangeable for
Shares of Common Stock of Cisco Systems, Inc.) of Morgan Stanley Dean Witter &
Co. (CUSIP No. 617446DK2) (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) June 5, 2006, (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. 11 dated May 27, 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. 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 Common Stock of Cisco Systems, Inc. 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
-----------