PROSPECTUS Dated May 18, 2000 Pricing Supplement No. 46 to
PROSPECTUS SUPPLEMENT Registration Statement No. 333-34392
Dated May 18, 2000 Dated November 14, 2000
Rule 424(b)(3)
$17,200,000
Morgan Stanley Dean Witter & Co.
MEDIUM-TERM NOTES, SERIES C
Senior Fixed Rate Notes
---------
0.25% Exchangeable Notes due November 30, 2007
Exchangeable for Shares of Common Stock of
THE PROCTER & GAMBLE COMPANY
Beginning December 18, 2000, you will be able to exchange your notes for a
number of shares of The Procter & Gamble Company common stock, subject to our
right to call all of the notes on or after November 18, 2002.
o The principal amount and issue price of each note is $1,000.
o We will pay interest at the rate of 0.25% per year on the $1,000 principal
amount of each note. Interest will be paid semi-annually on each May 30
and November 30, beginning May 30, 2001.
o Beginning December 18, 2000, you will have the right to exchange each note
for 12.86234 shares of Procter & Gamble 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 but unpaid
interest.
o Beginning November 18, 2002, we have the right to call all of the notes
and pay to you the call price of $1,000. However, if the market value of
12.86234 shares of Procter & Gamble common stock on the last trading day
before we send our call notice is equal to or greater than $1,000, we will
deliver to you 12.86234 shares of Procter & Gamble 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 Procter & Gamble 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 fifth
scheduled trading day prior to the call date.
o If you hold the notes to maturity, we will pay $1,000 per note to you.
o The Procter & Gamble Company is not involved in this offering of the notes
in any way and will have no obligation of any kind with respect to the
notes.
o We will apply to list the notes to trade under the proposed symbol "PGG.A"
on the American Stock Exchange, Inc.
You should read the more detailed description of the notes in this pricing
supplement. In particular, you should review and understand the descriptions in
"Summary of Pricing Supplement" and "Description of Notes."
The notes involve risks not associated with an investment in conventional debt
securities. See "Risk Factors" beginning on PS-6.
---------
PRICE 100% AND ACCRUED INTEREST
---------
Price to Public Agent's Commissions Proceeds to Company
--------------- ------------------- -------------------
Per Note..... 100% 0.25% 99.75%
Total........ $17,200,000 $43,000 $17,157,000
MORGAN STANLEY DEAN WITTER
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PS-2
<PAGE>
SUMMARY OF PRICING SUPPLEMENT
The following summary describes the notes we are offering to you in
general terms only. You should read the summary together with the more detailed
information that is contained in the rest of this pricing supplement and in the
accompanying prospectus and prospectus supplement. You should carefully
consider, among other things, the matters set forth in "Risk Factors."
The Notes
Each note costs $1,000 We, Morgan Stanley Dean Witter & Co., are
offering our 0.25% Exchangeable Notes due
November 30, 2007, which you may exchange for
The Procter & Gamble Company common stock
beginning on December 18, 2000. The principal
amount and issue price of each note is
$1,000. We refer to The Procter & Gamble
Company common stock as Procter & Gamble
Stock. If you hold the notes to maturity,
which is November 30, 2007, we will pay
$1,000 per note to you.
0.25% interest on the We will pay interest at the rate of 0.25% per
principal amount year on the $1,000 principal amount of each
note. Interest will be paid semi-annually on
each May 30 and November 30, beginning May
30, 2001.
Your Exchange Right
The exchange ratio Beginning December 18, 2000, you may exchange
is 12.86234 each note for a number of shares of Procter &
Gamble Stock equal to the exchange ratio. The
exchange ratio is 12.86234 shares of Procter
& Gamble Stock per note, subject to
adjustment for certain corporate events
relating to The Procter & Gamble Company,
which we refer to as Procter & Gamble. When
you exchange your notes, our affiliate Morgan
Stanley & Co. Incorporated or its successors,
which we refer to as MS & Co., acting as
calculation agent, will determine the exact
number of Procter & Gamble shares you will
receive based on the principal amount of the
notes you exchange and the exchange ratio as
it may have been adjusted through the time of
the exchange.
To exchange a note on any day, you must
instruct your broker or other person with
whom you hold your notes to take the
following steps through normal clearing
system channels:
o fill out an Official Notice of Exchange,
which is attached as Annex A to this
pricing supplement;
o deliver your Official Notice of Exchange to
us before 11:00 a.m. (New York City time)
on that day; and
o deliver your note certificate to The
Chase Manhattan Bank, as trustee for our
senior notes, on that day.
If you give us your Official Notice of
Exchange after 11:00 a.m. (New York City
time) on any day or at any time on a day when
the stock markets are closed, your notice
will not become effective until the next day
that the stock markets are open.
PS-3
<PAGE>
We can choose to pay We will pay to you, at our option, within
to you cash or Procter & 3 business days after you give us your
Gamble Stock if you elect Official Notice of Exchange, either:
to exchange your notes
o shares of Procter & Gamble Stock, or
o the cash value of such shares.
We will not pay any accrued but unpaid
interest 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 November 18, 2002, 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 Procter & Gamble Stock or the cash call
price that we will pay to you in exchange
for each note, as explained in the next
paragraph.
We may call the notes for On the last trading day before the date of
stock or cash, depending our call notice, the calculation agent will
on the price of Procter & determine the value of the shares of Procter
Gamble Stock & Gamble 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 of $1,000, 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 Procter & Gamble
Stock instead. In that case, you will still
have the right to exercise your exchange
right on any day prior to the call date.
Procter & Gamble Stock is The last reported sales price of Procter &
currently $72.4375 a share Gamble Stock on the New York Stock Exchange,
Inc. on the date of this pricing supplement
was $72.4375. You can review the
publicly-reported prices of Procter & Gamble
Stock for the last three years in the
"Historical Information" section of this
pricing supplement.
The Calculation Agent We have appointed our affiliate 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 Procter & Gamble 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
Procter & Gamble Stock and that we describe
in the section called "Description of
Notes--Antidilution Adjustments" in this
pricing supplement.
No Affiliation with Procter & Gamble is not an affiliate of ours
Procter & Gamble and is not involved with this offering in any
way. The notes are obligations of Morgan
Stanley Dean Witter & Co. and not of Procter
& Gamble.
PS-4
<PAGE>
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
18, 2000. 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 for a
detailed description of the terms of the
notes. You should also read about some of the
risks involved in investing in the notes in
the section called "Risk Factors." We urge
you to consult with your investment, legal,
accounting and other advisors with regards to
any investment in the notes.
How to reach us You may contact us at our principal executive
offices at 1585 Broadway, New York, New York
10036 (telephone number (212) 761-4000).
PS-5
<PAGE>
RISK FACTORS
The notes are not secured debt and are riskier than ordinary debt
securities. This section describes the most significant risks relating to the
notes. You should carefully consider whether the notes are suited to your
particular circumstances before you decide to purchase them.
Yield to Maturity Less Than These notes pay interest at the rate of 0.25%
Interest on Ordinary Notes of the principal amount per year. This
interest rate is lower than the interest rate
that we would pay on non-exchangeable senior
notes maturing at the same time as the notes.
If you exchange your notes or if we call the
notes, you will not receive any accrued but
unpaid interest.
Notes May Not Be There may be little or no secondary market
Actively Traded for the notes. Although we will apply to list
the notes on the American Stock Exchange,
Inc., the listing has not been approved. Even
if there is a secondary market, it may not
provide enough liquidity to allow you to
trade or sell the notes easily. MS & Co.
currently intends to act as a market maker
for the notes, but is not required to do so.
Market Price of Notes Several factors, many of which are beyond our
Influenced by Many control, will influence the value of the
Unpredictable Factors notes, including:
o the market price of Procter & Gamble Stock
o the volatility (frequency and magnitude of
changes in price) of Procter & Gamble Stock
o the dividend rate on Procter & Gamble Stock
o economic, financial, political,
regulatory or judicial events that affect
stock markets generally and which may
affect the market price of Procter &
Gamble Stock
o interest and yield rates in the market
the time remaining until (1) you can
exchange your notes for Procter & Gamble
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
Procter & Gamble Stock is at, below or not
sufficiently above the price of Procter &
Gamble Stock at pricing.
You cannot predict the future performance of
Procter & Gamble Stock based on its
historical performance.
PS-6
<PAGE>
No Affiliation with We are not affiliated with Procter & Gamble.
Procter & Gamble Although we do not have any non-public
information about Procter & Gamble as of the
date of this pricing supplement, we or our
subsidiaries may presently or from time to
time engage in business with Procter &
Gamble, including extending loans to, or
making equity investments in, Procter &
Gamble or providing advisory services to
Procter & Gamble, including merger and
acquisition advisory services. Moreover, we
have no ability to control or predict the
actions of Procter & Gamble, including any
corporate actions of the type that would
require the calculation agent to adjust the
exchange ratio. Procter & Gamble is not
involved in the offering of the notes in any
way and has no obligation to consider your
interest as an owner of these notes in taking
any corporate actions that might affect the
value of your notes. None of the money you
pay for the notes will go to Procter &
Gamble.
You Have No As an owner of notes, you will not have
Shareholder Rights voting rights or the right to receive
dividends or other distributions or any other
rights with respect to Procter & Gamble
Stock.
Limited Antidilution MS & Co., as calculation agent, will adjust
Adjustments the exchange ratio for certain events
affecting Procter & Gamble Stock, such as
stock splits and stock dividends, and certain
other corporate actions involving Procter &
Gamble, such as mergers. However, the
calculation agent is not required to make an
adjustment for every corporate event that can
affect Procter & Gamble Stock. For example,
the calculation agent is not required to make
any adjustments if Procter & Gamble or anyone
else makes a partial tender offer or a
partial exchange offer for Procter & Gamble
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 Procter &
Gamble Stock other than those contemplated in
this pricing supplement. Such adjustments
will be made to reflect the consequences of
events but not with the aim of changing
relative investment risk. The determination
by the calculation agent to adjust, or not to
adjust, the exchange ratio may materially and
adversely affect the market price of the
notes.
Potential Conflicts of As calculation agent, MS & Co. will calculate
Interest between You how many shares of Procter & Gamble Stock or
and the Calculation equivalent cash amount you will receive in
Agent and Other exchange for your notes and what adjustments
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
Procter & Gamble Stock as well as in other
instruments related to Procter & Gamble
Stock. MS & Co. and some of our subsidiaries
also trade Procter & Gamble Stock on a
regular basis as part of their general
broker-dealer businesses. We or our
subsidiaries may issue other securities
linked to Procter & Gamble Stock. Any of
these activities and MS & Co.'s affiliation
with us could influence MS & Co.'s
determinations as calculation agent,
including with respect to adjustments to the
exchange ratio, and, accordingly, the amount
of stock or cash that you receive when you
exchange the notes or when we call the notes.
In addition, such trading activity could
potentially affect the price of Procter &
Gamble Stock and, thereby, the value of the
Procter & Gamble 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, which will be higher than
the 0.25% interest rate you will receive on
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.
PS-8
<PAGE>
DESCRIPTION OF NOTES
Terms not defined herein have the meanings given to such terms in the
accompanying prospectus supplement. The term "Note" refers to each $1,000
principal amount of our 0.25% Exchangeable Notes due November 30, 2007
(Exchangeable for Shares of The Procter & Gamble Stock). In this pricing
supplement, the terms "MSDW," "we," "us" and "our" refer to Morgan Stanley Dean
Witter & Co.
Principal Amount.............. $17,200,000
Maturity Date................. November 30, 2007
Specified Currency............ U.S. Dollars
Issue Price................... 100%
Interest Rate................. 0.25% per annum
Interest Payment Dates........ May 30 and November 30, beginning May 30, 2001
Original Issue Date
(Settlement Date)............. November 17, 2000
CUSIP......................... 617446GD5
Minimum Denominations......... $1,000
Initial Procter & Gamble
Stock Price................... $71.656, the price of Procter & Gamble Stock
at the time we priced the Notes.
Exchange Right................ On any Exchange Date, you will be entitled
upon (i) your completion and delivery to us
and the Calculation Agent of an Official
Notice of Exchange (in the form of Annex A
attached hereto) prior to 11:00 a.m. New York
City time on such date and (ii) delivery on
such date of your Notes to the Trustee, to
exchange each Note for Procter & Gamble Stock
at the Exchange Ratio. You will not,
however, be entitled to exchange your Notes
if we have previously called the Notes for
the cash Call Price as described under
"--MSDW Call Right" below.
Upon any such exchange, we may, at our sole
option, either deliver such shares of Procter
& Gamble Stock or pay an amount in cash equal
to the Exchange Ratio times the Market Price
of Procter & Gamble Stock on the Exchange
Date, as determined by the Calculation Agent,
in lieu of such Procter & Gamble Stock. See
"--Market Price."
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 but unpaid
interest. If you exchange your Notes after a
record date for the payment of interest and
prior to the next succeeding Interest Payment
Date, the Notes that you exchange must be
accompanied by funds
PS-9
<PAGE>
equal to the interest payable on the succeeding
Interest Payment Date on the principal amount
you exchange.
We will, or will cause the Calculation Agent
to, deliver such shares of Procter & Gamble
Stock or cash to the Trustee for delivery to
you.
No Fractional Shares ......... If upon any exchange of the Notes we deliver
shares of Procter & Gamble Stock, we will pay
cash in lieu of delivering fractional shares
of Procter & Gamble Stock in an amount equal
to the corresponding fractional Market Price
of Procter & Gamble Stock as determined by
the Calculation Agent on such Exchange Date.
Exchange Ratio ............... 12.86234, subject to adjustment for certain
corporate events relating to Procter &
Gamble. See "--Antidilution Adjustments"
below.
Exchange Date................. Any Trading Day that falls during the period
beginning December 18, 2000 and ending on the
day prior to the earliest of (i) the last
scheduled Trading Day prior to the Maturity
Date, (ii) the fifth scheduled Trading Day
prior to the Call Date and (iii) in the event
of a call for the cash Call Price as
described under "--MSDW Call Right" below,
the last scheduled Trading Day prior to the
MSDW Notice Date.
MSDW Call Right .............. On or after November 18, 2002, we may call
the Notes, in whole but not in part, for
mandatory exchange into Procter & Gamble
Stock at the Exchange Ratio; provided that,
if Parity on the Trading Day immediately
preceding the MSDW Notice Date, as determined
by the Calculation Agent, is less than the
Call Price, we will pay the 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 Procter & Gamble
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
Procter & Gamble Stock or cash to the Trustee
for delivery to you. You will not receive
any accrued but unpaid interest on the Notes.
On or after the MSDW Notice Date (other than
with respect to a call of the Notes for the
cash Call Price by MSDW) you will continue to
be entitled to exercise the Exchange Right and
receive any amounts described under
"--Exchange Right" above.
MSDW Notice Date.............. The scheduled Trading Day on which we issue
our notice of mandatory exchange, which must
be at least 30 but no more than 60 days prior
to the Call Date.
Call Date..................... The scheduled Trading Day on or after
November 18, 2002 specified by us in our
notice of mandatory exchange on which we will
deliver Procter & Gamble Stock or cash to
holders of the Notes for mandatory exchange.
PS-10
<PAGE>
Parity........................ With respect to any Trading Day, an amount
equal to the Exchange Ratio times the Market
Price (as defined below) of Procter & Gamble
Stock on such Trading Day.
Call Price.................... $1,000 per Note.
Market Price.................. If Procter & Gamble Stock (or any other
security for which a Market Price must be
determined) is listed on a national
securities exchange, is a security of the
Nasdaq National Market or is included in the
OTC Bulletin Board Service ("OTC Bulletin
Board") operated by the National Association
of Securities Dealers, Inc. (the "NASD"), the
Market Price for one share of Procter &
Gamble Stock (or one unit of any such other
security) on any Trading Day means (i) the
last reported sale price, regular way, on
such day on the principal United States
securities exchange registered under the
Securities Exchange Act of 1934, as modified
(the "Exchange Act"), on which Procter &
Gamble 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 Procter
& Gamble 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 National Market or OTC
Bulletin Board on such day. If the last
reported sale price is not available pursuant
to clause (i) or (ii) of the preceding
sentence because of a Market Disruption Event
or otherwise, the Market Price for any
Trading Day shall be the mean, as determined
by the Calculation Agent, of the bid prices
for Procter & Gamble Stock (or any such other
security) obtained from as many dealers in
such security (which may include MS & Co. or
any of our other subsidiaries or affiliates),
but not exceeding three, as will make such
bid prices available to the Calculation
Agent. A "security of the Nasdaq National
Market" shall include a security included in
any successor to such system and the term
"OTC Bulletin Board Service" shall include
any successor service thereto.
Trading Day................... A day, as determined by the Calculation
Agent, on which trading is generally
conducted on the New York Stock Exchange, Inc.
("NYSE"), the American Stock Exchange, Inc.,
the Nasdaq National Market, 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 and on which a Market Disruption Event
has not occurred.
Book Entry Note or
Certificated Note............. Book Entry, DTC
Senior Note or Subordinated
Note.......................... Senior
Trustee....................... The Chase Manhattan Bank
Agent for this Underwritten
Offering of Notes............. MS & Co.
PS-11
<PAGE>
Calculation Agent............. MS & Co.
All determinations made by the Calculation
Agent will be at the sole discretion of the
Calculation Agent and will, in the absence of
manifest error, be conclusive for all purposes
and binding on you and on us.
Because the Calculation Agent is our
affiliate, potential conflicts of interest may
exist between the Calculation Agent and you as
an owner of the Notes, including with respect
to certain determinations and judgments that
the Calculation Agent must make in making
adjustments to the Exchange Ratio or other
anti-dilution adjustments or determining the
Market Price or whether a Market Disruption
Event has occurred. See "Antidilution
Adjustments" and "Market Disruption Event"
below. MS & Co. is obligated to carry out its
duties and functions as Calculation Agent in
good faith and using its reasonable judgment.
Antidilution Adjustments...... The Exchange Ratio will be adjusted as
follows:
1. If Procter & Gamble 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
Procter & Gamble Stock.
2. If Procter & Gamble Stock is subject (i) to
a stock dividend (issuance of additional
shares of Procter & Gamble Stock) that is
given ratably to all holders of shares of
Procter & Gamble Stock or (ii) to a
distribution of Procter & Gamble Stock as a
result of the triggering of any provision of
the corporate charter of Procter & Gamble,
then once the dividend has become effective
and Procter & Gamble 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 Procter & Gamble
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
Procter & Gamble Stock other than
distributions described in paragraph 6 below
and Extraordinary Dividends as described
below. A cash dividend or other distribution
with respect to Procter & Gamble Stock will be
deemed to be an "Extraordinary Dividend" if
such dividend or other distribution exceeds
the immediately preceding non-Extraordinary
Dividend for Procter & Gamble 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 Procter & Gamble 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 Procter &
Gamble Stock, the Exchange Ratio with respect
to Procter & Gamble Stock will be adjusted on
the ex-dividend date with respect to such
PS-12
<PAGE>
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 Procter &
Gamble 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 Procter &
Gamble 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 Procter & Gamble 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 Procter & Gamble 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 Procter & Gamble Stock so
long as a Market Price for Procter & Gamble
Stock is available. If a Market Price is no
longer available for Procter & Gamble Stock
for whatever reason, including the liquidation
of Procter & Gamble or the subjection of
Procter & Gamble to a proceeding under any
applicable bankruptcy, insolvency or other
similar law, then the value of Procter &
Gamble Stock will equal zero for so long as no
Market Price is available.
5. If there occurs any reclassification or
change of Procter & Gamble Stock, including,
without limitation, as a result of the
issuance of tracking stock by Procter &
Gamble, or if Procter & Gamble 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 Procter & Gamble as an entirety or
substantially as an entirety, in each case as
a result of which the holders of Procter &
Gamble Stock shall be entitled to receive
stock, other securities or other property or
assets (including, without limitation, cash or
other classes of stock of Procter & Gamble)
("Exchange Property") with respect to or in
exchange for such Procter & Gamble Stock, then
the holders of the Notes then outstanding will
be entitled thereafter to exchange such Notes
into the kind and amount of Exchange Property
that they would have owned or been entitled to
receive upon such reclassification, change,
merger, combination, consolidation, sale or
conveyance had such holders exchanged such
Notes at the then current Exchange Ratio for
Procter & Gamble Stock immediately prior to
any such corporate event, but without interest
thereon. At such time, no adjustment will be
made to the Exchange Ratio.
PS-13
<PAGE>
6. If Procter & Gamble issues to all of its
shareholders equity securities of an issuer
other than Procter & Gamble (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 Procter & Gamble 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 Procter & Gamble Stock.
7. No adjustments to the Exchange Ratio will
be required other than those specified above.
The adjustments specified above do not cover
all of the events that could affect the Market
Price. 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 Procter & Gamble
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 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 Procter & Gamble Stock, the occurrence or
existence of any of the following events as
determined by the Calculation Agent:
(i) a suspension, absence or material
limitation of trading of Procter & Gamble
Stock on the primary market for Procter &
Gamble 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 Procter & Gamble Stock
as a result of which the reported trading
prices for Procter & Gamble 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 Procter & Gamble
PS-14
<PAGE>
Stock, if available, during the one-half
hour period preceding the close of trading
in the applicable market; and
(ii) a determination by the Calculation
Agent in its sole discretion that any event
described in clause (i) above materially
interfered with the ability of MSDW or any
of its affiliates to unwind all or a
material portion of the hedge with respect
to the Notes.
For purposes of determining whether a Market
Disruption Event has occurred: (1) a
limitation on the hours or number of days of
trading will not constitute a Market
Disruption Event if it results from an
announced change in the regular business hours
of the relevant exchange, (2) a decision to
permanently discontinue trading in the
relevant option contract will not constitute a
Market Disruption Event, (3) limitations
pursuant to NYSE Rule 80A (or any applicable
rule or regulation enacted or promulgated by
the NYSE, any other self-regulatory
organization or the Securities and Exchange
Commission of similar scope as determined by
the Calculation Agent) on trading during
significant market fluctuations shall
constitute a suspension, absence or material
limitation of trading, (4) a suspension of
trading in an options contract on Procter &
Gamble 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 Procter & Gamble Stock and (5) a
suspension, absence or material limitation of
trading on the primary securities market on
which options contracts related to Procter &
Gamble 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 per Note upon any acceleration of any
Note shall be determined by MS & Co., as
Calculation Agent, and shall be equal to the
principal amount of a Note plus any accrued
and unpaid interest at the Interest Rate to
but not including the date of acceleration;
provided that if (x) the owner of a Note has
submitted an Official Notice of Exchange to
us in accordance with the Exchange Right or
(y) we have called the Notes, other than a
call for the cash Call Price, in accordance
with the MSDW Call Right, the amount declared
due and payable upon any such acceleration
shall be an amount in cash for each $1,000
principal amount of a Note equal to the
Exchange Ratio times the Market Price,
determined by the Calculation Agent as of the
Exchange Date or as of the date of
acceleration, respectively, and shall not
include any accrued and unpaid interest
thereon; provided further that if the Issuer
has called the Notes for cash in an amount
equal to the Call Price, in accordance with
the MSDW Call Right, the amount declared due
and payable upon any such acceleration shall
be
PS-15
<PAGE>
an amount in cash for each $1,000 principal
amount of a Note equal to the applicable Call
Price. See "--Call Price" above.
Procter & Gamble Stock;
Public Information............ Procter & Gamble manufactures and markets a
broad range of consumer products, including
fabric and home care, beauty care, health
care and food and beverage products. Procter
& Gamble 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
Procter & Gamble pursuant to the Exchange Act
can be located by reference to Commission
file number 1-434. In addition, information
regarding Procter & Gamble may be obtained
from other sources including, but not limited
to, press releases, newspaper articles and
other publicly disseminated documents. We
make no representation or warranty as to the
accuracy or completeness of such information.
This pricing supplement relates only to the
Notes offered hereby and does not relate to
Procter & Gamble Stock or other securities of
Procter & Gamble. We have derived all
disclosures contained in this pricing
supplement regarding Procter & Gamble 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 Procter & Gamble in connection
with the offering of the Notes. Neither we nor
the Agent makes any representation that such
publicly available documents are or any other
publicly available information regarding
Procter & Gamble is accurate or complete.
Furthermore, we cannot give any assurance that
all events occurring prior to the date hereof
(including events that would affect the
accuracy or completeness of the publicly
available documents described in the preceding
paragraph) that would affect the trading price
of Procter & Gamble Stock (and therefore the
Exchange Ratio) have been publicly disclosed.
Subsequent disclosure of any such events or
the disclosure of or failure to disclose
material future events concerning Procter &
Gamble 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.
PS-16
<PAGE>
Neither we nor any of our affiliates makes any
representation to you as to the performance of
Procter & Gamble Stock.
We or our subsidiaries may presently or from
time to time engage in business with Procter &
Gamble, including extending loans to, or
making equity investments in, Procter & Gamble
or providing advisory services to Procter &
Gamble, including merger and acquisition
advisory services. In the course of such
business, we or our subsidiaries may acquire
non-public information with respect to Procter
& Gamble and, in addition, one or more of our
affiliates may publish research reports with
respect to Procter & Gamble. 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 an
independent investigation of Procter & Gamble
as in your judgment is appropriate to make an
informed decision with respect to an
investment in Procter & Gamble Stock.
Historical Information........ The following table sets forth the published
high and low Market Price during 1997, 1998,
1999 and during 2000 through November 14,
2000. The Market Price on November 14, 2000
was $72.4375. 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 Procter & Gamble Stock as an
indication of future performance. We cannot
give any assurance that the price of Procter &
Gamble 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.
Procter & Gamble
Stock High Low Dividend
---------------- ---- --- --------
(CUSIP 74271810
1997
First Quarter... 64 3/4 53 5/16 0.225
Second Quarter.. 71 13/16 57 1/2 0.225
Third Quarter... 76 3/4 64 23/32 0.2525
Fourth Quarter.. 83 3/8 65 11/16 0.2525
1998
First Quarter... 86 9/16 78 0.2525
Second Quarter.. 92 3/16 80 3/4 0.2525
Third Quarter... 94 66 13/16 0.285
Fourth Quarter.. 93 3/4 71 1/8 0.285
1999
First Quarter... 101 1/8 83 5/8 0.285
Second Quarter.. 102 15/16 84 5/16 0.285
Third Quarter... 103 1/8 84 7/8 0.32
Fourth Quarter . 113 3/4 93 5/16 0.32
2000
First Quarter... 117 3/4 53 3/4 0.32
Second Quarter.. 70 1/2 53 3/8 0.32
Third Quarter... 67 54 9/16 0.35
Fourth Quarter
(through
November 14,
2000)........ 76 15/16 67 15/16 0.35
PS-17
<PAGE>
Historical prices have been adjusted for a
"two-for-one" stock split that became
effective in the third quarter of 1997.
We make no representation as to the amount of
dividends, if any, that Procter & Gamble will
pay in the future. In any event, as an owner
of a Note, you will not be entitled to receive
dividends, if any, that may be payable on
Procter & Gamble 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 Procter & Gamble 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 Procter & Gamble Stock. Our purchase
activity could have potentially increased the
price of Procter & Gamble Stock, and therefore
effectively have increased the level to which
Procter & Gamble Stock must rise before you
would receive an amount of Procter & Gamble
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 Procter & Gamble Stock, options
contracts on Procter & Gamble 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 Procter & Gamble 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.
ERISA Matters for Pension
Plans And Insurance
Companies..................... Each fiduciary of a pension, profit-sharing or
other employee benefit plan subject to the
Employee Retirement Income Security Act of
1974, as amended ("ERISA") (a "Plan"), should
consider the fiduciary standards of ERISA in
the context of the Plan's particular
circumstances before authorizing an investment
in the Notes Accordingly, among other factors,
the fiduciary should consider whether the
investment would satisfy the prudence and
diversification requirements of ERISA and
would be consistent with the documents and
instruments governing the Plan.
In addition, we and certain of our
subsidiaries and affiliates, including MS &
Co. and Dean Witter Reynolds Inc. ("DWR"), are
each to be considered a "party in interest"
within the meaning of ERISA, or a
"disqualified person" within the meaning of
the Internal Revenue Code of 1986, as amended
(the "Code") with respect to many Plans.
Prohibited transactions within the meaning of
ERISA or the Code would likely arise, for
example, if the Notes are acquired by
PS-18
<PAGE>
or with the assets of a 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. A violation of
these "prohibited transaction" rules may
result in an excise tax or other liabilities
under ERISA and/or Section 4975 of the Code
for such persons, unless exemptive relief is
available under an applicable statutory or
administrative exemption.
The U.S. Department of Labor has issued five
prohibited transaction class exemptions
("PTCEs") that may provide exemptive relief
for direct or indirect prohibited transactions
resulting from the purchase or holding of the
Notes. Those class exemptions are PTCE 96-23
(for certain transactions determined by
in-house asset managers), PTCE 95-60 (for
certain transactions involving insurance
company general accounts), PTCE 91-38 (for
certain transactions involving bank collective
investment funds), PTCE 90-1 (for certain
transactions involving insurance company
separate accounts) and PTCE 84-14 (for certain
transactions determined by independent
qualified asset managers).
Because we are considered a party in interest
with respect to many Plans, the Notes may not
be purchased or held by any Plan, any entity
whose underlying assets include "plan assets"
by reason of any Plan's investment in the
entity (a "Plan Asset Entity") or any person
investing "plan assets" of any Plan, unless
such purchaser or holder is eligible for
exemptive relief, including relief available
under PTCE 96-23, 95-60, 91-38, 90-1 or 84-14
or such purchase and holding is otherwise not
prohibited. Any purchaser, including any
fiduciary purchasing on behalf of a Plan, or
holder of the Notes will be deemed to have
represented, in its corporate and fiduciary
capacity, by its purchase and holding thereof
that it either (a) is not a Plan or a Plan
Asset Entity and is not purchasing such
securities on behalf of or with "plan assets"
of any Plan or (b) is eligible for exemptive
relief or such purchase or holding is not
prohibited by ERISA or Section 4975 of the
Code.
Under ERISA, assets of a 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.
Accordingly, insurance company general
accounts that include assets of a Plan must
ensure that one of the foregoing exemptions is
available. Due to the complexity of these
rules and the penalties that may be imposed
upon persons involved in non-exempt prohibited
transactions, it is particularly important
that fiduciaries or other persons considering
purchasing the Notes on behalf of or with
"plan assets" of any Plan consult with their
counsel regarding the availability of
exemptive relief under PTCE 96-23, 95-60,
91-38, 90- 1 or 84-14.
Purchasers of the Notes have exclusive
responsibility for ensuring that their
purchase and holding of the Notes do not
violate the prohibited transaction rules of
ERISA or the Code.
PS-19
<PAGE>
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
6.822%, 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 the semi- annual coupons and an
additional projected amount due at maturity,
equal to $1,581.09.
The comparable yield and the projected payment
schedule are not provided for any purpose
other than the determination of United States
Holders' interest accruals and adjustments in
respect of the Notes, and we make no
representation regarding the actual amounts of
the payments on a Note.
PS-20
<PAGE>
ANNEX A
OFFICIAL NOTICE OF EXCHANGE
Dated: [On or after December 18, 2000]
Morgan Stanley Dean Witter & Co.
1585 Broadway
New York, New York 10036
Morgan Stanley & Co. Incorporated, as
Calculation Agent
1585 Broadway
New York, New York 10036
Fax No.: (212) 761-0674
(Attn: Meghan Maloney)
Dear Sirs:
The undersigned holder of the Medium Term Notes, Series C, Senior Fixed
Rate Notes, 0.25% Exchangeable Notes due November 30, 2007 (Exchangeable for
Shares of Common Stock of The Procter & Gamble Company) of Morgan Stanley Dean
Witter & Co. (CUSIP No. 617446GD5) (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) the last scheduled Trading Day prior to November 30, 2007,
(ii) the fifth scheduled Trading Day prior to the Call Date and (iii) in the
event of a call for the cash Call Price, the last scheduled Trading Day prior
to the MSDW Notice Date, the Exchange Right as described in Pricing Supplement
No. 46 dated November 14, 2000 (the "Pricing Supplement") to the Prospectus
Supplement dated May 18, 2000 and the Prospectus dated May 18, 2000 related to
Registration Statement No. 333-34392. 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 MSDW will
deliver, at its sole option, shares of the common stock of The Procter & Gamble
Company 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
------------
