PROSPECTUS Dated May 5, 1999 Pricing Supplement No. 8 to
PROSPECTUS SUPPLEMENT Registration Statement No. 333-75289
Dated May 6, 1999 Dated May 17, 1999
Rule 424(b)(3)
$45,000,000
Morgan Stanley Dean Witter & Co.
MEDIUM-TERM NOTES, SERIES C
Senior Fixed Rate Notes
---------------
Redeemable BRIDGES due May 30, 2005
Based on the
Morgan Stanley High-Technology 35 Index(SM)
Redeemable BRoad InDex Guarded Equity-linked Securities(SM)
("Redeemable BRIDGES(SM)")
The Redeemable BRIDGES will pay the principal amount of $10 at maturity. The
Redeemable BRIDGES will also pay an amount based on the percentage increase in
value, if any, over the life of these Redeemable BRIDGES of the Morgan Stanley
High-Technology 35 Index, which we refer to as the Tech-35 Index. In each
case, the payments are subject to our right to redeem (call) all of the
Redeemable BRIDGES at established prices on or after May 30, 2002 until
November 30, 2004.
o The principal amount and issue price of each Redeemable BRIDGES is $10.
o We will not pay interest on the Redeemable BRIDGES.
o At maturity, unless we have called the Redeemable BRIDGES, you will receive
the principal amount of $10 per Redeemable BRIDGES plus a supplemental
redemption amount. This amount is based on the percentage increase in value,
if any, at maturity of the Tech-35 Index. If the value of the Tech-35 Index
at the maturity of the Redeemable BRIDGES is higher than 1,045.14, which is
the value of the Tech-35 Index on May 17, 1999, the date we offered the
Redeemable BRIDGES for initial sale to the public, then you will receive a
supplemental redemption amount per Redeemable BRIDGES equal to the percentage
increase of the Tech-35 Index multiplied by $10.
o However, if the value of the Tech 35 Index at maturity is not higher than
1,045.14, which is the value of the Tech-35 Index on May 17, 1999, the date
we offered the Redeemable BRIDGES for initial sale to public, then you will
not receive any supplemental redemption amount, but you will still receive
the principal amount of the Redeemable BRIDGES.
o Beginning May 30, 2002 and ending on November 30, 2004, we can call all of
the Redeemable BRIDGES and pay you a predetermined call price. The call price
will be $16 on May 30, 2002 and will increase by $0.50 every six months up to
and including November 30, 2004, to a maximum of $18 per Redeemable BRIDGES.
If we decide to call the Redeemable BRIDGES, we will give you notice at least
30 but not more than 60 days prior to the call date specified in the notice.
If we call the Redeemable BRIDGES, you will receive only the call price and
will not be entitled to receive any supplemental redemption amount.
o Investing in the Redeemable BRIDGES is not equivalent to investing in the
stocks included in the Tech-35 Index.
o The Redeemable BRIDGES have been approved for listing on the New York Stock
Exchange, Inc., subject to official notice of issuance. The NYSE symbol for
the Redeemable BRIDGES is "RBT."
You should read the more detailed description of the Redeemable BRIDGES in
this pricing supplement. In particular, you should review and understand the
descriptions in "Summary of Pricing Supplement" and "Description of Redeemable
BRIDGES," including "--United States Federal Taxation." "Redeemable BRoad
Index Guarded Equity-linked Securities" and "Redeemable BRIDGES" are our
service marks. "Morgan Stanley High-Technology 35 Index" is a service mark of
Morgan Stanley & Co. Incorporated.
The Redeemable BRIDGES involve risks not associated with an investment in
conventional debt securities. See "Risk Factors" beginning on PS-6.
PRICE $10 PER REDEEMABLE BRIDGES
Proceeds to
Price to Public Agent's Commissions Company
--------------- ------------------- -----------
Per Redeemable BRIDGES..... $10 $0.25 $9.75
Total...................... $45,000,000 $1,125,000 $43,875,000
MORGAN STANLEY DEAN WITTER
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SUMMARY OF PRICING SUPPLEMENT
The following summary describes the Redeemable BRIDGES 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 Redeemable BRIDGES offered are medium-term debt securities
of Morgan Stanley Dean Witter & Co. The return on the Redeemable BRIDGES is
linked to the performance of the Morgan Stanley High-Technology 35 Index,
which we refer to as the Tech-35 Index. These Redeemable BRIDGES combine
features of debt and equity by offering at maturity 100% protection of the
issue price with the opportunity to participate in the upside potential of the
underlying Tech-35 Index. However, we may also call the Redeemable BRIDGES
prior to maturity.
Each Redeemable BRIDGES We, Morgan Stanley Dean Witter & Co., are
costs $10 offering you Redeemable BRIDGES due May 30,
2005 based on the Morgan Stanley High-
Technology 35 Index. The principal amount and
issue price of each Redeemable BRIDGES is $10.
Payment at Maturity Unlike ordinary debt securities, the Redeemable
BRIDGES do not pay interest. Instead, you will
receive the principal amount of $10 per
Redeemable BRIDGES plus a supplemental
redemption amount, if the value of the Tech-35
Index increases over the life of the Redeemable
BRIDGES.
100% Principal Protection
Unless we have called the Redeemable BRIDGES,
we will pay you at least $10 at maturity, plus
the supplemental redemption amount, if any.
The Supplemental Redemption Amount
The supplemental redemption amount will be
equal to the percentage increase of the Tech-35
Index multiplied by $10. The supplemental
redemption amount will be calculated as
follows:
Final Index Value - Initial Index Value
$10 x -----------------------------------------
Initial Index Value
where,
Initial Index Value = 1,045.14, which is
the closing value
of the Tech-35
Index on May 17,
1999, the date we
offered the
Redeemable BRIDGES
for initial sale
to the public
Final Index Value = the closing value of
the Tech-35 Index
on the fifth
trading day prior
to May 30, 2005
However, if this amount is zero or less, we
will not pay you a supplemental redemption
amount. In other words, if the Tech-35 Index
does not go up over the life of the Redeemable
BRIDGES, you will not receive any supplemental
redemption amount. Be
Our Call Right Beginning May 30, 2002 and ending November 30,
2004, we have the right to call all of the
Redeemable BRIDGES at the call prices listed in
the table below. If we decide to call the
Redeemable BRIDGES, we will:
o send a notice announcing that we have decided
to call the Redeemable BRIDGES;
o specify in the notice the call price that we
will pay you in exchange for each Redeemable
BRIDGES; and
o specify in the notice a call date when you
will receive the call price; that call date
will be at least 30 but not more than 60 days
after the date of the notice.
The Call Price
The table below shows the call prices for the
period from May 30, 2002 to November 29, 2002
and every six month call date period thereafter
through and including November 30, 2004.
Call Date Periods Call Price
----------------- ----------
May 30, 2002 to November 29, 2002........ $16.00
November 30, 2002 to May 29, 2003........ $16.50
May 30, 2003 to November 29, 2003........ $17.00
November 30, 2003 to May 29, 2004........ $17.50
May 30, 2004 to November 30, 2004........ $18.00
The Tech-35 Index The last reported closing value of the Tech-35
is currently at 1,045.14 Index on the American Stock Exchange, Inc. on
the date of this pricing supplement was
1,045.14. You can review the publicly-reported
closing values of Tech-35 Index since such
values were first reported on June 30, 1995 in
the "Historical Information" section of this
pricing supplement. The payment of dividends on
the stocks which compose, or underlie, the
Tech-35 Index is not reflected in the level of
the Tech-35 Index and, therefore, has no effect
on our calculation of the percentage increase
in the Tech-35 Index.
The Calculation Agent We have appointed Morgan Stanley & Co.
Incorporated, which we refer to as 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 percentage change in the Tech-35
Index, the final index value and the
supplemental redemption amount.
MS & Co., on behalf of MSCI, MS & Co., on behalf of Morgan Stanley Capital
Consults on the Tech-35 Index International Inc., or MSCI, an indirect,
majority-owned subsidiary of ours which owns
the Tech-35 Index, acts as consultant to the
American Stock Exchange, Inc. in connection
with the calculation of the Tech-35 Index. The
American Stock Exchange is responsible for the
design and maintenance of the Tech- 35 Index,
including decisions regarding the calculation
of the Tech-35 Index such as the addition and
deletion of constituent stocks and other
methodological modifications of the Tech-35
Index. MS&Co. or MSCI, to the extent that MSCI
elects to act directly rather than through MS &
Co., may from time to time suggest changes in
the Tech-35 Index. The actions and judgments of
MS & Co. or MSCI may affect the value of the
Tech-35 Index, and, consequently, could
adversely affect the value of the Redeemable
BRIDGES. You should read about certain
potential conflicts that may exist because of
our affiliation with MS & Co. and MSCI in the
section called "Risk Factors -- Potential
Conflicts of Interest Between You and MS & Co."
More Information on the The Redeemable BRIDGES are senior notes issued
Redeemable BRIDGES as part of 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" and " -- Notes Linked to
Commodity Prices, Single Securities, Baskets of
Securities or Indices."
Because this is a summary, it does not
contain all of the information that may be
important to you, including the specific
mechanics and timing of the call
provisions. You should read the
"Description of Redeemable BRIDGES"
section in this pricing supplement for a
detailed description of the terms of the
Redeemable BRIDGES. You should also read
about some of the risks involved in
investing in Redeemable BRIDGES in the
section called "Risk Factors." We urge you
to consult with your investment, legal,
accounting and other advisors with regard
to any investment in the Redeemable
BRIDGES.
How to Reach Us You may contact your local Morgan Stanley
Dean Witter branch office or our principal
executive offices at 1585 Broadway, New York,
New York 10036 (telephone number (212)
762-4000).
RISK FACTORS
The Redeemable BRIDGES are not secured debt and, unlike
ordinary debt securities, the Redeemable BRIDGES do not pay interest. This
section describes the most significant risks relating to the Redeemable
BRIDGES. You should carefully consider whether the Redeemable BRIDGES are
suited to your particular circumstances before you decide to purchase them.
Redeemable BRIDGES Are The terms of the Redeemable BRIDGES differ from
Not Ordinary Senior Notes those of ordinary debt securities in that we
will not pay interest on the Redeemable
BRIDGES. Because the supplemental redemption
amount due at maturity may be equal to zero,
the return on your investment (the effective
yield to maturity) in the Redeemable BRIDGES
may be less than the amount which would be paid
on an ordinary debt security. The return of
only the principal amount of each Redeemable
BRIDGES at maturity will not compensate you for
any loss in value due to inflation and other
factors relating to the value of money over
time.
Redeemable BRIDGES May If the percentage change in the Tech-35 Index
Not Pay More than Par at is equal to or less than zero, you will receive
Maturity only the par amount of $10 for each Redeemable
BRIDGES you hold at maturity.
Secondary Trading There may be little or no secondary market for
May Be Limited the Redeemable BRIDGES. Although the Redeemable
BRIDGES have been approved for listing on the
New York Stock Exchange, Inc., it is not
possible to predict whether the Redeemable
BRIDGES will trade in the secondary markets.
Even if there is a secondary market, it may not
provide enough liquidity to allow you to trade
or sell the Redeemable BRIDGES easily.
Market Price of the Several factors, many of which are beyond our
Redeemable BRIDGES control, will influence the value of the
Influenced by Many Redeemable BRIDGES, including:
Unpredictable Factors
o the value of the Tech-35 Index
o interest and yield rates in the market
o the volatility (frequency and magnitude of
changes in price) of the Tech-35 Index
o economic, financial, political and regulatory
or judicial events that affect the securities
underlying the Tech-35 Index or stock markets
generally and which may affect the final
index value
o the time remaining to the maturity of the
Redeemable BRIDGES
o the dividend rate on the stocks underlying
the Tech-35 Index
o our creditworthiness
Some or all of these factors will influence the
price that you will receive if you sell your
Redeemable BRIDGES prior to maturity. For
example, you may have to sell your Redeemable
BRIDGES at a substantial discount from the
principal amount if at the time of sale the
Tech-35 Index is at, below, or not sufficiently
above the initial index value or if market
interest rates rise.
You cannot predict the future performance of
the Tech-35 Index based on its historical
performance. We cannot guarantee that the value
of the Tech-35 Index will increase so that you
will receive at maturity an amount in excess of
the principal amount of the Redeemable BRIDGES.
Adjustments to the The American Stock Exchange, Inc., or the AMEX,
Tech-35 Index Could in consultation with MSCI and MS & Co., acting
Adversely Affect the on behalf of MSCI, is responsible for
Redeemable BRIDGES calculating and maintaining the Tech-35 Index.
The AMEX can add, delete or substitute the
stocks underlying the Tech-35 Index or make
other methodological changes that could change
the value of the Tech-35 Index. The AMEX may
discontinue or suspend calculation or
dissemination of the Tech-35 Index. Any of
these actions could adversely affect the value
of the Redeemable BRIDGES.
Potential Conflicts of Interest The Tech-35 Index was developed by MS & Co. and
between You and MS & Co. is owned by MSCI. The Tech-35 Index is a
service mark of MS & Co. and has been licensed
for certain purposes to the AMEX in exchange
for a fee. MSCI is responsible for advising the
AMEX as the AMEX composes, calculates and
maintains the Tech-35 Index and MSCI has
delegated its responsibilities to MS & Co. MS &
Co. and MSCI each have considerable influence
over the composition and calculation of the
Tech-35 Index. Certain judgments that MS & Co.
or MSCI could make in connection with
consultation as to the composition and
calculation of the Tech- 35 Index could affect
the value of the Tech-35 Index and,
consequently, the value of the Redeemable
BRIDGES. See "Description of Redeemable
BRIDGES-- Morgan Stanley High-Technology 35
Index" and "--Discontinuance of the Tech-35
Index; Alteration of Method of Calculation"
below.
As calculation agent, MS & Co. calculates the
amount paid to you at maturity of the
Redeemable BRIDGES. MS & Co. and other
affiliates may carry out activities that
minimize our risks related to the Redeemable
BRIDGES, including trading in the individual
stocks included in the Tech-35 Index as well as
in other instruments related to the Tech-35
Index. MS & Co. and some of our other
subsidiaries also trade the individual stocks
included in the Tech-35 Index and other
financial instruments related to the Tech-35
Index on a regular basis as part of their
general broker-dealer businesses. Any of these
activities could influence MS & Co.'s
determination of calculations made with respect
to the Redeemable BRIDGES and, accordingly,
could affect your payout on the Redeemable
BRIDGES.
Because MS & Co. and MSCI are consulted by the
AMEX concerning the Tech-35 Index composition
and calculation and because MS & Co. also
calculates the percentage change in the Tech-35
Index, the final index value and the
supplemental redemption amount, potential
conflicts of interest may exist between MS &
Co. as calculation agent, MS & Co. or MSCI as
consultants for the calculation of the Tech-35
Index and you as holder of a Redeemable
BRIDGES.
Investment in the The payment of dividends on the stocks which
Redeemable BRIDGES Not compose, or underlie, the Tech- 35 Index has no
the Same as an Investment in effect on the calculation of the percentage
the Tech-35 Index Stocks increase in the Tech- 35 Index. Therefore, the
return on your investment based on the
percentage change in the Tech-35 Index is not
the same as the total return based on the
purchase of those underlying stocks held for a
similar period.
Tax Treatment You should also consider the tax consequences
of investing in the Redeemable BRIDGES. The
Redeemable BRIDGES are best suited for accounts
(including non-U.S. accounts) not subject to
U.S. federal income taxes. U.S. taxable
investors will be subject to annual income tax
based on the comparable yield, as defined in
the accompanying prospectus supplement, of the
Redeemable BRIDGES even though they will not
receive any payments thereon prior to maturity
and at maturity may only receive the return of
the par amount of the Redeemable BRIDGES. In
addition, any gain recognized by U.S. taxable
investors on the sale, exchange or redemption
of the Redeemable BRIDGES will be treated as
ordinary income. Please read carefully the
section "Description of Redeemable BRIDGES--
United States Federal Taxation" in this pricing
supplement.
DESCRIPTION OF REDEEMABLE BRIDGES
Capitalized terms not defined herein have the meanings given to such terms in
the accompanying prospectus supplement. The term "Redeemable BRIDGES" refers
to each $10 principal amount of any of our Redeemable BRIDGES due May 30, 2005
based on the Morgan Stanley High-Technology 35 Index. In this pricing
supplement, the "Company," "we," "us" and "our" refer to Morgan Stanley Dean
Witter & Co.
Principal Amount.............. $45,000,000
Original Issue Date
(Settlement Date)............. May 20, 1999
Maturity Date................. May 30, 2005
Specified Currency............ U.S. Dollars
CUSIP......................... 617446232
Minimum Denominations......... $10
Issue Price................... $10
Interest Rate................. None
Maturity Redemption Amount.... At maturity (including as a result of
acceleration or under the terms of the Senior
Debt Indenture), you will receive $10, the
par amount of the Redeemable BRIDGES, plus
the Supplemental Redemption Amount, if any.
Supplemental Redemption
Amount........................ We will pay you a Supplemental Redemption
Amount per Redeemable BRIDGES at maturity
equal to the greater of (a) zero and (b) the
product of $10 and the Tech-35 Index Percent
Change. The Calculation Agent will calculate
the Supplemental Redemption Amount on the
date the Final Index Value is determined.
The Calculation Agent will provide written
notice to the Trustee at its New York office,
on which notice the Trustee may conclusively
rely, of the Supplemental Redemption Amount,
on or prior to 11:00 a.m. on the Business Day
preceding the Maturity Date. See
"Discontinuance of the Tech-35 Index;
Alteration of Method of Calculation" below.
The Calculation Agent will round all
percentages resulting from any calculation
with respect to the Redeemable BRIDGES to the
nearest one hundred-thousandth of a
percentage point, with five one- millionths
of a percentage point rounded upwards (e.g.,
9.876545% (or .09876545) would be rounded to
9.87655% (or .0987655)). All dollar amounts
resulting from such calculation will be
rounded to the nearest cent with one-half
cent being rounded upwards.
Tech-35 Index Percent Change.. The Tech-35 Index Percent Change is a
fraction, the numerator of which will be the
Final Index Value less the Initial Index
Value and the denominator of which will be
the Initial Index Value. The Tech- 35 Index
Percent Change is described by the following
formula:
(Final Index Value - Initial Index Value)
-----------------------------------------
Initial Index Value
Initial Index Value........... 1,045.14
Final Index Value............. The Final Index Value will be the Index
Closing Value on the fifth scheduled Trading
Day prior to the Maturity Date.
If a Market Disruption Event occurs on the
fifth scheduled Trading Day prior to the
Maturity Date, the Final Index Value will be
determined on the immediately succeeding
Trading Day during which no Market Disruption
Event occurred; provided that the Final Index
Value will not be determined on a date later
than the second scheduled Trading Day
preceding the Maturity Date, and if such date
is not a Trading Day, or if there is a Market
Disruption Event on such date, the
Calculation Agent will determine the value of
the Tech-35 Index on such date in accordance
with the formula for and method of
calculating the Tech-35 Index last in effect
prior to the commencement of the Market
Disruption Event (or prior to the non-
Trading Day), using the closing price (or, if
trading in the relevant securities has been
materially suspended or materially limited,
its good faith estimate of the closing price
that would have prevailed but for such
suspension or limitation or non-Trading Day)
on such date of each security most recently
constituting the Tech-35 Index.
Index Closing Value........... The Index Closing Value will equal the
closing value of the Tech-35 Index or any
Successor Index at the regular official
weekday close of trading on a specified date.
See "--Discontinuance of the Tech- 35 Index;
Alteration of Method of Calculation."
In this "Description of Redeemable BRIDGES,"
references to the Tech-35 Index will include
any Successor Index, unless the context
requires otherwise.
Call Right ................... On or after May 30, 2002, and up to and
including November 30, 2004, we may call the
Redeemable BRIDGES, in whole but not in part,
for mandatory exchange into cash at the
applicable Call Price as described below. We
will not pay you a Supplemental Redemption
Amount if we call the Redeemable BRIDGES. If
we call the Redeemable BRIDGES, then the cash
to be delivered to you will be delivered on
the Call Date fixed by us and set forth in
our call notice, upon delivery of your
Redeemable BRIDGES to the Trustee in
accordance with the delivery instructions. We
shall, or shall cause the Calculation Agent
to, deliver the cash to the Trustee for
delivery to you.
Notice Date................... The scheduled Trading Day on which we issue
our call notice, which must be at least 30
but not more than 60 calendar days prior to
the Call Date.
Call Date..................... The scheduled Trading Day specified by us in
our call notice on or after May 30, 2002 to
and including November 30, 2004, on which we
will deliver the cash Call Price to you upon
mandatory exchange of the Redeemable BRIDGES.
Call Price.................... The table below shows the Call Prices for
each $10 principal amount of Redeemable
BRIDGES for the period from May 30, 2002 to
November 29, 2002 and for each six month Call
Date Period thereafter to and including
November 30, 2004.
Call Date Periods Call Price
----------------- ----------
May 30, 2002 to November 29, 2002........ $ 16.00
November 30, 2002 to May 29, 2003........ $ 16.50
May 30, 2003 to November 29, 2003........ $ 17.00
November 30, 2003 to May 29, 2004........ $ 17.50
May 30, 2004 to November 30, 2004........ $ 18.00
Trading Day................... A day, as determined by the Calculation
Agent, on which trading is generally
conducted on the New York Stock Exchange
("NYSE"), the AMEX, the NASDAQ NMS, the
Chicago Mercantile Exchange, and the Chicago
Board of Options Exchange and in the
over-the- counter market for equity
securities in the United States.
Book Entry Note or
Certificated Note............. Book Entry
Senior Note or Subordinated
Note.......................... Senior
Trustee....................... The Chase Manhattan Bank
Agent......................... Morgan Stanley & Co. Incorporated
Market Disruption Event....... "Market Disruption Event" means with respect
to the Tech-35 Index, the occurrence or
existence of either of the following events
as determined by the Calculation Agent:
(i) a suspension, material limitation or
absence of trading of stocks then
constituting 20% or more, by weight, of the
Tech-35 Index (or the relevant Successor
Index) on the Relevant Exchanges for such
securities 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 trading systems of any Relevant
Exchange as a result of which the reported
trading prices for stocks then constituting
20% or more, by weight, of the Tech-35
Index (or the relevant Successor Index)
during the last one-half hour preceding the
closing of trading on such Relevant
Exchange are materially inaccurate; or the
suspension, material limitation or absence
of trading on any major U.S. securities
market of trading in futures or options
contracts related to the Tech-35 Index (or
the relevant Successor Index) for more than
two hours of trading or during the one-half
hour period preceding the close of trading
on such 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 Redeemable BRIDGES.
For the purpose of determining whether a
Market Disruption Event exists at any time,
if trading in a security included in the
Tech-35 Index is materially suspended or
materially limited at that time, then the
relevant percentage contribution of that
security to the level of the Tech-35 Index
shall be based on a comparison of (x) the
portion of the level of the Tech-35 Index
attributable to that security relative to (y)
the overall level of the Tech-35 Index, in
each case immediately before that suspension
or limitation.
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 or market, (2)
a decision to permanently discontinue trading
in the relevant futures or options contract
will not constitute a Market Disruption
Event, (3) limitations pursuant to the rules
of any Relevant Exchange similar to NYSE Rule
80A (or any applicable rule or regulation
enacted or promulgated by any other
self-regulatory organization or any
government agency of similar scope as
determined by the Calculation Agent) on
trading during significant market
fluctuations will constitute a suspension,
absence or material limitation of trading,
(4) a suspension of trading in a futures or
options contract on the Tech-35 Index by the
primary securities market related to such
contract by reason of (a) a price change
exceeding limits set by such exchange or
market, (b) an imbalance of orders relating
to such contracts or (c) a disparity in bid
and ask quotes relating to such contracts
will constitute a suspension or material
limitation of trading in futures or options
contracts related to the Tech-35 Index and
(5) a "suspension, absence or material
limitation of trading" on any Relevant
Exchange or on the primary market on which
futures or options contracts related to the
Tech-35 Index are traded will not include any
time when such market is itself closed for
trading under ordinary circumstances.
Relevant Exchange............. "Relevant Exchange" means the primary U.S.
organized exchange or market of trading for
any security then included in the Tech-35
Index or any Successor Index.
Alternative Calculation of the
Final Index Value in case of
an Event of Default .......... If an Event of Default with respect to any
Redeemable BRIDGES shall have occurred and be
continuing, the Calculation Agent will
determine the amount declared due and payable
upon any acceleration of the Redeemable
BRIDGES, which will be equal to $10 plus the
Supplemental Redemption Amount, if any,
determined as though the date on which the
Final Index Value is scheduled to be
determined were the date of acceleration.
Calculation Agent............. Morgan Stanley & Co. Incorporated and its
successors.
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 the holder of the Redeemable BRIDGES,
including with respect to certain
determinations and judgments that the
Calculation Agent must make in determining
the Tech-35 Index Percent Change, the Final
Index Value, the Supplemental Redemption
Amount or whether a Market Disruption Event
has occurred. See "Discontinuance of the
Tech-35 Index; Alteration of Method of
Calculation" below and "Market Disruption
Event" above. MS & Co., as a registered
broker-dealer, is required to maintain
policies and procedures regarding the
handling and use of confidential proprietary
information, and such policies and procedures
will be in effect throughout the term of the
Redeemable BRIDGES to restrict the use of
information relating to the calculation of
the Tech-35 Index Percent Change, the Final
Index Value and the Supplemental Redemption
Amount prior to the dissemination of such
information. MS & Co. is obligated to carry
out its duties and functions as Calculation
Agent in good faith and using its reasonable
judgment.
Morgan Stanley High-
Technology 35 Index......... We have derived all information contained in
this pricing supplement regarding the Tech-35
Index, including, without limitation, its
make-up, method of calculation and changes in
its components, from publicly available
information. Such information reflects the
policies of, and is subject to change by,
MSCI and the AMEX. The Tech-35 Index was
developed by MS & Co., is owned by MSCI, and
is calculated and maintained by AMEX in
consultation with MS & Co., acting on behalf
of MSCI. None of MS & Co., MSCI or the AMEX
has any obligation to continue to calculate
and publish, and may discontinue calculation
and publication of, the Tech-35 Index.
The Tech-35 Index is comprised of 35 actively
traded stocks of U.S. companies in the
computer and technology industries with large
market capitalizations. Publication of the
Tech-35 Index began on June 30, 1995, based
on an initial value of 200 as of the close of
trading on December 16, 1994.
The Tech-35 Index is calculated using an
"equal dollar-weighting" methodology designed
to ensure that each of the component stocks
is represented in approximately equal dollar
amounts in the Index. In calculating the
initial "equal dollar-weighting" of component
stocks, the AMEX, using closing prices on
December 16, 1994, calculated the number of
shares that would represent an investment of
$300,000 in each of the stocks contained in
the Index (to the nearest whole share). The
value of the Tech-35 Index on any date equals
the current market value (based on U.S.
primary market prices) of the assigned number
of shares of each of the stocks in the
Tech-35 Index divided by the current Tech-35
Index divisor. The Tech-35 Index divisor was
initially calculated to yield a benchmark
value of 200 at the close of trading on
December 16, 1994. Annually thereafter,
following the close of trading on the third
Friday of December, the AMEX has adjusted and
plans to continue to adjust the Tech-35 Index
portfolio, without changing the value of the
Tech-35 Index, by changing the number of
shares of each component stock so that each
company is again represented in "equal"
dollar amounts. If necessary, the AMEX
adjusts the divisor to ensure continuity of
the Tech-35 Index's value. The newly adjusted
portfolio becomes the basis for the Tech-35
Index's value on the first trading day
following the annual adjustment.
Subject to the maintenance criteria discussed
below, the number of shares of each component
stock in the Tech-35 Index will remain fixed
between annual reviews except in the event of
certain types of corporate actions, such as
the payment of a dividend (other than an
ordinary cash dividend), stock distributions,
stock splits, reverse stock splits, rights
offerings, distributions, reorganizations,
recapitalizations, or similar events with
respect to a Tech-35 Index component stock.
In a merger or consolidation of an issuer of
a component security, if the security remains
in the Tech-35 Index, the number of shares of
that security will be adjusted, if necessary,
to the nearest whole share, to maintain the
component's relative weight in the Tech-35
Index at the level immediately prior to the
corporate action. In the event of a stock
replacement, the average dollar value of the
remaining Tech-35 Index components will be
calculated and that amount invested in the
replacement stock, rounded to the nearest
whole share. In all cases, the divisor will
be adjusted, if necessary, to ensure Tech-35
Index continuity. The divisor and other
statistics based on the Tech-35 Index is
published and disseminated daily by the AMEX,
on Bloomberg Financial Markets and Reuters
Limited.
A current list of the issuers of the
component stocks of the Tech-35 Index and the
weighting of each component stock as of May
14, 1999, as a percentage of the total index
capitalization, is set forth below. (The
weighting of each stock is equal upon annual
rebalancing, but varies throughout the year
as the component stocks rise and fall in
value compared to other component stocks.)
Stock
Company Name Exchange % Weights
------------ -------- ---------
Amazon.com Inc.......................... NASDAQ 2.78%
America Online, Inc..................... NYSE 5.58%
Applied Materials, Inc.................. NASDAQ 3.10%
Ascend Communications, Inc.............. NASDAQ 3.63%
Automatic Data Processing, Inc.......... NYSE 2.65%
Cisco Systems, Inc...................... NASDAQ 2.97%
Compaq Computer Corporation............. NYSE 1.40%
Computer Associates Int'l, Inc.......... NYSE 2.51%
Computer Sciences Corporation........... NYSE 2.00%
Dell Computer Corporation............... NASDAQ 2.82%
Electronic Arts, Inc.................... NASDAQ 2.54%
Electronic Data Systems Corp............ NYSE 2.70%
EMC Corporation......................... NYSE 2.96%
First Data Corporation.................. NYSE 3.55%
Hewlett-Packard Company................. NYSE 2.98%
Intel Corporation....................... NASDAQ 2.25%
International Business Machines Corp.... NYSE 3.25%
Intuit, Inc............................. NASDAQ 2.55%
Lucent Technologies, Inc................ NYSE 2.76%
Micron Technology....................... NYSE 1.62%
Microsoft Corporation................... NASDAQ 2.59%
Motorola, Inc........................... NYSE 3.28%
Northern Telecom........................ NYSE 3.56%
Oracle Corporation...................... NASDAQ 2.12%
Parametric Technology Co................ NASDAQ 1.73%
PeopleSoft, Inc......................... NASDAQ 1.95%
Seagate Technology Inc.................. NYSE 2.16%
Solectron Corporation................... NYSE 3.34%
STMicroelectronics N.V.................. NYSE 3.45%
Sun Microsystems, Inc................... NASDAQ 3.63%
Tellabs, Inc............................ NASDAQ 4.28%
Texas Instruments, Inc.................. NYSE 2.84%
3Com Corporation........................ NASDAQ 1.48%
Xilinx, Inc............................. NASDAQ 3.54%
Yahoo! Inc.............................. NASDAQ 3.45%
Source: AMEX
The composition of the Tech-35 Index is
reviewed annually to ensure that the
component stocks meet certain minimum
capitalization, trading volume and listing
requirements and to ensure that at least 90%
of the Tech-35 Index's numerical value
satisfies AMEX criteria for standardized
options trading. In addition to the annual
rebalancings, if at any time between annual
rebalancing the top five component
securities, by weight, account for more than
one-third of the weight of the Tech-35 Index,
the Tech-35 Index will be similarly
rebalanced. The component stocks of the
Tech-35 Index may be changed at any time for
any reason.
None of MSDW, the AMEX, MS & Co. or any of
our affiliates guarantees the accuracy and/or
the completeness of the Tech-35 Index or any
data included therein and neither shall have
any liability for any errors, omissions, or
interruptions therein. None of MSDW, the
AMEX, MS & Co. or any of our affiliates makes
any warranty, express or implied, as to
results to be obtained by us, owners of the
Redeemable BRIDGES, or any other person or
entity from the use of the Tech-35 Index or
any data included therein. The AMEX makes no
express or implied warranties, and expressly
disclaims all warranties, or merchantability
or fitness for a particular purpose or use
with respect to the Tech-35 Index or any data
included therein. Without limiting any of the
foregoing, in no event shall any of MSDW, the
AMEX, MS & Co. or any of our affiliates have
any liability for any lost profits or
indirect, punitive, special or consequential
damages, even if notified of the possibility
thereof. There are no third party
beneficiaries of any agreements or
arrangements between the AMEX and us.
We or our affiliates may presently or from
time to time engage in business with one or
more of the issuers of the component stocks
of the Tech-35 Index, including selling
products and/or services to, purchasing
products and/or services from, extending
loans to or making equity investments in any
of such issuers or providing advisory
services to such issuers, including merger
and acquisition advisory services. In the
course of such business, we, or our
affiliates, may acquire non-public
information with respect to such companies
and, in addition, one or more of our
affiliates may publish research reports with
respect to such issuers. The statements in
the preceding sentence are not intended to
affect the right of holders of the Redeemable
BRIDGES under the securities laws. You should
undertake an independent investigation of the
issuers of the component stocks of the
Tech-35 Index and of the Tech-35 Index to the
extent required, in your judgment, to allow
you to make an informed decision with respect
to an investment in the Redeemable BRIDGES.
Conflicts of Interest
Because MS & Co. and MSCI are our
subsidiaries, potential conflicts of interest
may exist between MS & Co., MSCI and you,
including with respect to certain
determinations and judgments made in
determining the Tech-35 Index. The policies
and judgments of MS & Co. and MSCI concerning
additions, deletions and substitutions of the
stocks underlying the Tech-35 Index and the
manner in which certain changes affecting
such underlying stocks are taken into account
in the calculation of the Tech-35 Index may
affect the value of the Tech-35 Index. It is
also possible that the AMEX, either
independently or in consultation with MS &
Co. or MSCI, may discontinue or suspend
calculation or dissemination of the Tech-35
Index and that, consequently, MS & Co., as
Calculation Agent, would have to select a
successor or substitute index, or itself
calculate an index value, from which to
calculate the supplemental redemption amount,
if any. Any such actions or judgments could
adversely affect the value of the Redeemable
BRIDGES.
MS & Co. and MSCI each maintains policies and
procedures regarding the handling and use of
confidential proprietary information, and
those policies and procedures will be in
effect throughout the term of the Redeemable
BRIDGES to restrict the use of information
relating to the calculation of the Tech-35
Index prior to its dissemination. MS & Co.
will carry out its duties and functions in
connection with its determination of the
Tech-35 Index in good faith and by exercising
the diligence and reasonableness of a prudent
expert in comparable circumstances.
It is also possible that any advisory
services that our affiliates provide in the
course of any business with the issuers of
the component stocks could lead to actions on
the part of such underlying issuers which
might adversely affect the level of the
Tech-35 Index.
Discontinuance of the Tech-35
Index; Alteration of Method
of Calculation.............. If the AMEX or MSCI discontinues
publication of the Tech-35 Index and the AMEX
or another entity (including MS & Co. or
MSCI) publishes a successor or substitute
index that MS & Co. as the Calculation Agent
determines, in its sole discretion, to be
comparable to the discontinued Tech-35 Index
(such index being referred to herein as a
"Successor Index"), then any subsequent Index
Closing Value will be determined by reference
to the value of such Successor Index at the
close of trading on the NYSE, the AMEX,
NASDAQ NMS or the relevant exchange or market
for the Successor Index on the date that the
Final Index Value is to be determined.
Upon any selection by the Calculation Agent
of a Successor Index, the Calculation Agent
will cause written notice thereof to be
furnished to the Trustee, to MSDW and to the
holders of the Redeemable BRIDGES within
three Trading Days of such selection.
If MS & Co. or the AMEX discontinues
publication of the Tech-35 Index prior to,
and such discontinuance is continuing on, the
date that the Final Index Value is to be
determined and MS & Co. as the Calculation
Agent determines that no Successor Index is
available at such time, then on such date,
the Calculation Agent will determine the
Index Closing Value that would be used in
computing the Tech- 35 Index Percent Change
on such date. The Index Closing Value will be
computed by the Calculation Agent in
accordance with the formula for and method of
calculating the Tech-35 Index last in effect
prior to such discontinuance, using the
closing price (or, if trading in the relevant
securities has been materially suspended or
materially limited, its good faith estimate
of the closing price that would have
prevailed but for such suspension or
limitation) on such date of each security
most recently comprising the Tech-35 Index.
Notwithstanding these alternative
arrangements, discontinuance of the
publication of the Tech-35 Index may
adversely affect the value of the Redeemable
BRIDGES.
If at any time the method of calculating the
Tech-35 Index or a Successor Index, or the
value thereof, is changed in a material
respect, or if the Tech-35 Index or a
Successor Index is in any other way modified
so that such index does not, in the opinion
of MS & Co., as the Calculation Agent, fairly
represent the value of the Tech- 35 Index or
such Successor Index had such changes or
modifications not been made, then, from and
after such time, the Calculation Agent will,
at the close of business in New York City on
the date that the Final Index Value is to be
determined make such calculations and
adjustments as, in the good faith judgment of
the Calculation Agent, may be necessary in
order to arrive at a value of a stock index
comparable to the Tech-35 Index or such
Successor Index, as the case may be, as if
such changes or modifications had not been
made, and calculate the Supplemental
Redemption Amount with reference to the
Tech-35 Index or such Successor Index, as
adjusted. Accordingly, if the method of
calculating the Tech-35 Index or a Successor
Index is modified so that the value of such
index is a fraction of what it would have
been if it had not been modified (e.g., due
to a split in the index), then the
Calculation Agent will adjust such index in
order to arrive at a value of the Tech-35
Index or such Successor Index as if it had
not been modified (e.g., as if such split had
not occurred).
Historical Information........ The following table sets forth the high and
low daily closing values, as well as
end-of-quarter closing values, of the Tech-35
Index for each quarter in the period from
June 30, 1995 through May 17, 1999. The Index
Closing Values listed below were obtained
from Bloomberg Financial Markets. We believe
all such information to be accurate. The
historical values of the Tech-35 Index should
not be taken as an indication of future
performance, and no assurance can be given
that the Tech-35 Index will increase
sufficiently to cause you to receive any
Supplemental Redemption Amount at maturity
(assuming that we have not called the
Redeemable BRIDGES prior to maturity).
Daily Index Closing Values
--------------------------------
High Low Period End
------ ----- ----------
1995
June 30, 1995...... - - 292.50
Third Quarter...... 340.07 293.33 325.83
Fourth Quarter..... 361.21 298.54 315.77
1996
First Quarter...... 353.94 284.44 316.50
Second Quarter..... 358.70 313.00 325.04
Third Quarter...... 360.78 280.53 352.54
Fourth Quarter..... 412.28 339.02 383.04
1997
First Quarter...... 421.97 348.50 354.60
Second Quarter..... 441.01 343.99 426.23
Third Quarter...... 536.85 430.99 520.40
Fourth Quarter..... 535.31 419.22 447.52
1998
First Quarter...... 543.34 422.84 542.48
Second Quarter..... 599.75 519.22 595.80
Third Quarter...... 654.92 480.15 573.78
Fourth Quarter..... 875.45 481.04 874.47
1999
First Quarter...... 1034.26 884.83 1020.45
Second Quarter (through
May 17, 1999).... 1098.91 951.65 1045.14
Source: Bloomberg Financial Markets
Use of Proceeds and Hedging... The net proceeds we receive from the sale of
the Redeemable BRIDGES 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 Redeemable BRIDGES, including hedging
market risks associated with the Supplemental
Redemption Amount. See also "Use of Proceeds"
in the accompanying Prospectus.
On the date of this pricing supplement, we,
through our subsidiaries or others, hedged
our anticipated exposure in connection with
the Redeemable BRIDGES by the purchase and
sale of exchange traded and over-the-counter
options on the Tech-35 Index, individual
stocks included in the Tech-35 Index, futures
contracts on the Tech-35 Index and options on
such futures contracts or by taking positions
in any other instruments that we wished to
use in connection with such hedging. Through
our subsidiaries, we are likely to modify our
hedge position throughout the life of the
Redeemable BRIDGES, including on the date
that the Final Index Value is to be
determined, by purchasing and selling the
securities and instruments listed above and
any other available securities and
instruments that we may wish to use in
connection with our hedging activity.
Although we have no reason to believe that
our hedging activity had or will have a
material impact on the price of such options,
stocks, futures contracts, and options on
futures contracts or on the value of the
Tech-35 Index, we cannot give any assurance
that we did not, or in the future will not,
affect such prices as a result of its hedging
activities.
Supplemental Information Concerning
Plan of Distribution.......... In order to facilitate the offering of the
Redeemable BRIDGES, the Agent may engage in
transactions that stabilize, maintain or
otherwise affect the price of the Redeemable
BRIDGES or the stocks underlying the Tech-35
Index. Specifically, the Agent may overallot
in connection with the offering, creating a
short position in the Redeemable BRIDGES for
its own account. In addition, to cover
allotments or to stabilize the price of the
Redeemable BRIDGES, the Agent may bid for,
and purchase, the Redeemable BRIDGES or the
stocks underlying the Tech-35 Index in the
open market. See "Use of Proceeds and
Hedging" above.
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 Redeemable BRIDGES 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 Redeemable
BRIDGES are acquired pursuant to an exemption
from the prohibited transaction rules.
The acquisition of the Redeemable BRIDGES 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, the 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.
United States Federal
Taxation...................... The Redeemable BRIDGES are linked to an index
and you 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 6.31%, compounded
annually. Based on our determination of the
comparable yield, the "projected payment
schedule" for a Redeemable BRIDGES (assuming
a par amount of $10 or with respect to each
integral multiple thereof) consists of a
projected amount due at maturity, equal to
$14.49.
The following table states the amount of
interest that will be deemed to have accrued
with respect to a Redeemable BRIDGES during
each accrual period, based upon the our
determination of the comparable yield and the
projected payment schedule:
TOTAL
INTEREST
INTEREST DEEMED TO
DEEMED TO HAVE ACCRUED
ACCRUE FROM ORIGINAL
DURING ISSUE DATE PER
ACCRUAL NOTE AS OF END
PERIOD (PER OF ACCRUAL
ACCRUAL PERIOD NOTE) PERIOD
-------------- ----------- --------------
Original Issue Date through
December 31, 1999............. $ 0.39 $ 0.39
January 1, 2000 through
December 31, 2000............ $ 0.66 $ 1.05
January 1, 2001 through
December 31, 2001............ $ 0.70 $ 1.75
January 1, 2002 through
December 31, 2002............ $ 0.74 $ 2.49
January 1, 2003 through
December 31, 2003............ $ 0.79 $ 3.28
January 1, 2004 through
December 31, 2004............ $ 0.84 $ 4.12
January 1, 2005 through May 30,
2005......................... $ 0.37 $ 4.49
The comparable yield and the projected
payment schedule are not provided for any
purpose other than the determination of
United States Holders' interest accruals and
adjustments thereof in respect of the
Redeemable BRIDGES for federal income tax
purposes and do not constitute a
representation regarding the actual amounts
of the payments on the Redeemable BRIDGES.
Additional Disclosure for Non-U.S. Holders.
The following discussion is based on the
opinion of Davis Polk & Wardwell, special tax
counsel to MSDW. As used herein, the term
"Non-U.S. Holder" means an owner of a
Redeemable BRIDGES that is, for United States
federal income tax purposes, (i) a
nonresident alien individual, (ii) a foreign
corporation, (iii) a nonresident alien
fiduciary of a foreign trust or estate or
(iv) a foreign partnership one or more of the
members of which is, for United States
federal income tax purposes, a nonresident
alien individual, a foreign corporation or a
nonresident alien fiduciary of a foreign
trust or estate. The following summary does
not deal with persons that are not Non-U.S.
Holders or that are subject to special rules,
such as nonresident alien individuals who
have lost United States citizenship or who
have ceased to be taxed as United States
resident aliens, corporations that are
treated as foreign personal holding
companies, controlled foreign corporations or
passive foreign investment companies, and
certain other Non-U.S. Holders that are owned
or controlled by persons subject to United
States federal income tax. In addition,
unless otherwise noted, the following summary
does not apply to persons for whom interest
or gain on a Redeemable BRIDGES is
effectively connected with a trade or
business in the United States. If you are
considering the purchase of the Redeemable
BRIDGES, you should consult your tax advisors
with regard to the application of the United
States federal income tax laws to your
particular situation as well as any tax
consequences arising under the laws of any
state, local or foreign taxing jurisdiction.
This discussion is based on the Code and
administrative interpretations as of the date
hereof, all of which are subject to change,
including changes with retroactive effect.
Capitalized terms appearing herein and not
defined have the meanings assigned to such
terms in the Prospectus Supplement.
Subject to the discussion below concerning
backup withholding, payments of principal and
the Supplemental Redemption Amount, if any,
at maturity of a Redeemable BRIDGES by us or
a paying agent to a Non-U.S. Holder, and gain
realized on the sale, exchange or other
disposition of such Redeemable BRIDGES, will
not be subject to United States federal
income or withholding tax, provided that: (i)
such Non-U.S. Holder does not own, actually
or constructively, 10 percent or more of the
total combined voting power of all classes of
our stock entitled to vote, is not a
controlled foreign corporation related,
directly or indirectly, to us through stock
ownership, and is not a bank receiving
interest described in Section 881(c)(3)(A) of
the Code; (ii) the statement required by
Section 871(h) or Section 881(c) of the Code
has been provided with respect to the
beneficial owner, as discussed below; (iii)
such Non-U.S. Holder is not an individual who
is present in the United States for 183 days
or more in the taxable year of disposition,
or such individual does not have a "tax home"
(as defined in Section 911(d)(3) of the Code)
or an office or other fixed place of business
in the United States; (iv) such payment and
gain are not effectively connected with the
conduct by such Holder of a trade or business
in the United States; and (v) the securities
underlying the Tech-35 Index continue to be
actively traded for U.S. federal income tax
purposes.
Sections 871(h) and 881(c) of the Code and
applicable regulations require that, in order
to obtain the portfolio interest exemption
from withholding tax, either the beneficial
owner of the Redeemable BRIDGES, or a
securities clearing organization, bank or
other financial institution that holds
customers' securities in the ordinary course
of its trade or business (a "Financial
Institution") and that is holding the
Redeemable BRIDGES on behalf of such
beneficial owner, file a statement with the
withholding agent to the effect that the
beneficial owner of the Redeemable BRIDGES is
not a United States person. Under United
States Treasury Regulations, such requirement
will be fulfilled if the beneficial owner of
a Redeemable BRIDGES certifies on Internal
Revenue Service Form W-8 (or any successor
form), under penalties of perjury, that it is
not a United States person and provides its
name and address, and any Financial
Institution holding the Redeemable BRIDGES on
behalf of the beneficial owner files a
statement with the withholding agent to the
effect that it has received such a statement
from the Holder (and furnishes the
withholding agent with a copy thereof). With
respect to Redeemable BRIDGES held by a
foreign partnership, under current law, the
Form W-8 (or any successor form) may be
provided by the foreign partnership. However,
for payments with respect to a Redeemable
BRIDGES after December 31, 2000, unless the
foreign partnership has entered into a
withholding agreement with the Internal
Revenue Service, a foreign partnership will
be required, in addition to providing an
intermediary Form W-8 (or any successor
form), to attach an appropriate certification
by each partner. If you, including foreign
partnerships and their partners, are a
prospective investor, you should consult your
tax advisors regarding possible additional
reporting requirements.
Under Section 2105(b) of the Code, a
Redeemable BRIDGES held by an individual who
is not a citizen or resident of the United
States at the time of his death will not be
subject to United States federal estate tax
as a result of such individual's death,
provided that the individual does not own,
actually or constructively, 10 percent or
more of the total combined voting power of
all classes of our stock entitled to vote
and, at the time of such individual's death,
payments with respect to such Redeemable
BRIDGES would not have been effectively
connected to the conduct by such individual
of a trade or business in the United States.
Under current Treasury Regulations, backup
withholding at 31% will not apply to payments
by us or any paying agent made on a
Redeemable BRIDGES if the certifications
required by Sections 871(h) and 881(c) are
received, provided in each case that we or
such paying agent, as the case may be, do not
have actual knowledge that the payee is a
United States person.
Under current Treasury Regulations, payments
on the sale, exchange or other disposition of
a Redeemable BRIDGES made to or through a
foreign office of a broker generally will not
be subject to backup withholding. However, if
such broker is a United States person, a
controlled foreign corporation for United
States tax purposes, a foreign person 50
percent or more of whose gross income is
effectively connected with a United States
trade or business for a specified three-year
period or, in the case of payments made after
December 31, 2000, a foreign partnership with
certain connections to the United States,
information reporting will be required unless
the broker has in its records documentary
evidence that the beneficial owner is not a
United States person and certain other
conditions are met or the beneficial owner
otherwise establishes an exemption. Backup
withholding may apply to any payment which
such broker is required to report if such
broker has actual knowledge that the payee is
a United States person. Payments to or
through the United States office of a broker
will be subject to backup withholding and
information reporting unless the Holder
certifies, under penalties of perjury, that
it is not a United States person or otherwise
establishes an exemption.
If you are a Non-U.S. Holder of Redeemable
BRIDGES, you should consult your tax advisors
regarding the application of information
reporting and backup withholding in your
particular situation, the availability of an
exemption therefrom, and the procedure for
obtaining such an exemption, if available.
Any amounts withheld from a payment to a
Non-U.S. Holder under the backup withholding
rules will be allowed as a credit against
such Holder's United States federal income
tax liability and may entitle such Holder to
a refund, provided that the required
information is furnished to the Internal
Revenue Service.
