PROSPECTUS Dated May 18, 2000 Pricing Supplement No. 45 to
PROSPECTUS SUPPLEMENT Registration Statement No. 333-34392
Dated May 18, 2000 Dated November 14, 2000
Rule 424(b)(3)
$12,000,000
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
KIMBERLY-CLARK CORPORATION
Beginning December 18, 2000, you will be able to exchange your notes for a
number of shares of Kimberly- Clark Corporation 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 14.228862 shares of Kimberly-Clark 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
14.228862 shares of Kimberly-Clark 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 14.228862 shares of Kimberly-Clark 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 Kimberly-Clark 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 Kimberly-Clark Corporation 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 "KCM.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............. $12,000,000 $30,000 $11,970,000
MORGAN STANLEY DEAN WITTER
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PS-2
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SUMMARY OF PRICING SUPPLEMENT
The following summary describes the notes we are offering to you in
general terms only. You should read the summary together with the more detailed
information that is contained in the rest of this pricing supplement and in the
accompanying prospectus and prospectus supplement. You should carefully
consider, among other things, the matters set forth in "Risk Factors."
The Notes
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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 Kimberly-Clark
Corporation common stock beginning on December 18, 2000. The principal
amount and issue price of each note is $1,000. We refer to Kimberly-Clark
Corporation common stock as Kimberly-Clark 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 year on the $1,000 principal amount
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 each note for a number of
is 14.228862 shares of Kimberly-Clark Stock equal to the exchange ratio. The exchange ratio
is 14.228862 shares of Kimberly-Clark Stock per note, subject to adjustment for
certain corporate events relating to Kimberly-Clark Corporation, which we refer
to as Kimberly-Clark. 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 Kimberly-Clark
shares you will receive based on the principal amount of the notes you exchange
and the exchange ratio as it may have been adjusted through the time of the
exchange.
To exchange a note on any day, you must instruct your broker or other person
with whom you hold your notes to take the following steps through normal
clearing system channels:
o fill out an Official Notice of Exchange, which is attached as Annex A to this
pricing supplement;
o deliver your Official Notice of Exchange to us before 11:00 a.m. (New York
City time) on that day; and
o deliver your note certificate to The Chase Manhattan Bank, as trustee for
our senior notes, on that day.
If you give us your Official Notice of Exchange after 11:00 a.m. (New York City
time) on any day or at any time on a day when the stock markets are closed,
your notice will not become effective until the next day that the stock markets
are open.
We can choose to pay to We will pay to you, at our option, within 3 business days after you give us your
you cash or Kimberly-Clark Official Notice of Exchange, either:
Stock if you elect to exchange
your notes o shares of Kimberly-Clark Stock, or
o the cash value of such shares.
PS-3
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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 Kimberly-Clark Stock or the
cash call price that we will pay to you in exchange for each note, as
explained in the next paragraph.
We may call the notes for On the last trading day before the date of our call notice, the calculation agent
stock or cash, depending will determine the value of the shares of Kimberly-Clark Stock that a noteholder
on the price of Kimberly-Clark would receive upon exchange of a note. That value is referred to as parity. If
Stock 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 Kimberly-Clark Stock instead. In that case, you
will still have the right to exercise your exchange right on any day prior to the
call date.
Kimberly-Clark Stock is The last reported sales price of Kimberly-Clark Stock on the New York Stock
currently $64.50 a share Exchange, Inc. on the date of this pricing supplement was $64.50. You can
review the publicly-reported prices of Kimberly-Clark 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
Kimberly-Clark 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
Kimberly-Clark Stock and that we describe in the section called "Description of
Notes--Antidilution Adjustments" in this pricing supplement.
No Affiliation with Kimberly-Clark is not an affiliate of ours and is not involved with this offering
Kimberly-Clark in any way. The notes are obligations of Morgan Stanley Dean Witter & Co. and
not of Kimberly-Clark.
More Information The notes are senior notes issued as part of our Series C medium-term note
on the Notes 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."
PS-4
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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
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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 for
Actively Traded 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 Kimberly-Clark Stock
o the volatility (frequency and magnitude
of changes in price) of Kimberly-Clark
Stock
o the dividend rate on Kimberly-Clark Stock
o economic, financial, political,
regulatory or judicial events that
affect stock markets generally and which
may affect the market price of
Kimberly-Clark Stock
o interest and yield rates in the market
o the time remaining until (1) you can
exchange your notes for Kimberly-Clark
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
Kimberly-Clark Stock is at, below or not
sufficiently above the price of
Kimberly-Clark Stock at pricing.
You cannot predict the future performance of
Kimberly-Clark Stock based on its historical
performance.
PS-6
<PAGE>
No Affiliation with We are not affiliated with Kimberly-Clark.
Kimberly-Clark Although we do not have any non-public
information about Kimberly-Clark as of the
date of this pricing supplement, we or our
subsidiaries may presently or from time to
time engage in business with Kimberly-Clark,
including extending loans to, or making
equity investments in, Kimberly-Clark or
providing advisory services to
Kimberly-Clark, including merger and
acquisition advisory services. Moreover, we
have no ability to control or predict the
actions of Kimberly-Clark, including any
corporate actions of the type that would
require the calculation agent to adjust the
exchange ratio. Kimberly- Clark 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 Kimberly-Clark.
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 Kimberly-Clark Stock.
Limited Antidilution MS & Co., as calculation agent, will adjust
Adjustments the exchange ratio for certain events
affecting Kimberly-Clark Stock, such as stock
splits and stock dividends, and certain other
corporate actions involving Kimberly-Clark,
such as mergers. However, the calculation
agent is not required to make an adjustment
for every corporate event that can affect
Kimberly-Clark Stock. For example, the
calculation agent is not required to make any
adjustments if Kimberly-Clark or anyone else
makes a partial tender offer or a partial
exchange offer for Kimberly-Clark 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
Kimberly-Clark 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 Kimberly-Clark 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 activitiesrelated to the notes or to
other instruments, including trading in
Kimberly-Clark Stock as well as in other
instruments related to Kimberly-Clark Stock.
MS & Co. and some of our subsidiaries also
trade Kimberly-Clark Stock on a regular basis
as part of their general broker-dealer
businesses. We or our subsidiaries may issue
other securities linked to Kimberly-Clark
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
Kimberly-Clark Stock and, thereby, the value
of the Kimberly-Clark Stock or cash you will
receive upon exchange or redemption.
PS-7
<PAGE>
Tax Treatment You should also consider the tax consequences
of investing in the notes. If you are a U.S.
taxable investor, you will be subject to
annual income tax based on the comparable
yield of the notes, 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
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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 Kimberly-Clark Stock). In this pricing supplement,
the terms "MSDW," "we," "us" and "our" refer to Morgan Stanley Dean Witter &
Co.
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Principal Amount............................ $12,000,000
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....................................... 617446GC7
Minimum Denominations....................... $1,000
Initial Kimberly-Clark Stock Price.......... $64.625, the price of Kimberly-Clark 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
Kimberly-Clark 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 Kimberly-Clark Stock or pay an amount in cash equal to
the Exchange Ratio times the Market Price of Kimberly-Clark Stock on
the Exchange Date, as determined by the Calculation Agent, in lieu of
such Kimberly-Clark 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
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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 Kimberly-Clark Stock or cash to the Trustee for delivery to you.
No Fractional Shares ....................... If upon any exchange of the Notes we deliver shares of Kimberly-
Clark Stock, we will pay cash in lieu of delivering fractional shares
of Kimberly-Clark Stock in an amount equal to the corresponding
fractional Market Price of Kimberly-Clark Stock as determined by
the Calculation Agent on such Exchange Date.
Exchange Ratio ............................. 14.228862, subject to adjustment for certain corporate events relating
to Kimberly-Clark. 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 Kimberly-Clark 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 Kimberly-Clark 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 Kimberly-Clark 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
Kimberly-Clark Stock or cash to holders of the Notes for mandatory
exchange.
PS-10
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Parity...................................... With respect to any Trading Day, an amount equal to the Exchange
Ratio times the Market Price (as defined below) of Kimberly-Clark
Stock on such Trading Day.
Call Price.................................. $1,000 per Note.
Market Price................................ If Kimberly-Clark 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 Kimberly-Clark 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 Kimberly-
Clark 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 Kimberly-Clark 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
Kimberly-Clark 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
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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 Kimberly-Clark 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 Kimberly-Clark Stock.
2. If Kimberly-Clark Stock is subject (i) to a stock dividend
(issuance of additional shares of Kimberly-Clark Stock) that is given
ratably to all holders of shares of Kimberly-Clark Stock or (ii) to a
distribution of Kimberly-Clark Stock as a result of the triggering of
any provision of the corporate charter of Kimberly-Clark, then once
the dividend has become effective and Kimberly-Clark 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
Kimberly-Clark 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 Kimberly- Clark
Stock other than distributions described in paragraph 6 below and
Extraordinary Dividends as described below. A cash dividend or other
distribution with respect to Kimberly-Clark Stock will be deemed to be
an "Extraordinary Dividend" if such dividend or other distribution
exceeds the immediately preceding non-Extraordinary Dividend for
Kimberly-Clark 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
Kimberly-Clark 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
Kimberly-Clark Stock, the Exchange Ratio with respect to
Kimberly-Clark Stock will be adjusted on the ex-dividend date with
respect to such Extraordinary Dividend so that the new Exchange Ratio
will equal the product of (i) the then current Exchange Ratio
PS-12
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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 Kimberly-Clark 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 Kimberly-Clark 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
Kimberly-Clark 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 Kimberly-Clark 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 Kimberly-Clark Stock so
long as a Market Price for Kimberly-Clark Stock is available. If a
Market Price is no longer available for Kimberly-Clark Stock for
whatever reason, including the liquidation of Kimberly-Clark or the
subjection of Kimberly-Clark to a proceeding under any applicable
bankruptcy, insolvency or other similar law, then the value of
Kimberly-Clark Stock will equal zero for so long as no Market Price is
available.
5. If there occurs any reclassification or change of Kimberly-Clark
Stock, including, without limitation, as a result of the issuance of
tracking stock by Kimberly-Clark, or if Kimberly-Clark 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 Kimberly-Clark as an
entirety or substantially as an entirety, in each case as a result of
which the holders of Kimberly-Clark Stock shall be entitled to receive
stock, other securities or other property or assets (including,
without limitation, cash or other classes of stock of Kimberly-Clark)
("Exchange Property") with respect to or in exchange for such
Kimberly-Clark 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
Kimberly-Clark Stock immediately prior to any such corporate event,
but without interest thereon. At such time, no adjustment will be made
to the Exchange Ratio.
6. If Kimberly-Clark issues to all of its shareholders equity
securities of an issuer other than Kimberly-Clark (other than in a
transaction described in paragraph 5 above), then the holders of the
PS-13
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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 Kimberly-Clark 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 Kimberly-Clark 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 Kimberly-Clark 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 Kimberly-Clark
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
Kimberly-Clark Stock on the primary market for Kimberly-Clark
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 Kimberly-Clark Stock as a result of which
the reported trading prices for Kimberly-Clark 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 Kimberly-Clark Stock, if available, during the one-half
hour period preceding the close of trading in the applicable
market; and
PS-14
<PAGE>
(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 Kimberly-Clark 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 Kimberly-Clark Stock and (5) a
suspension, absence or material limitation of trading on the primary
securities market on which options contracts related to Kimberly-Clark
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
an amount in cash for each $1,000 principal amount of a Note equal
to the applicable Call Price. See "--Call Price" above.
PS-15
<PAGE>
Kimberly-Clark Stock;
Public Information.......................... According to Kimberly-Clark's annual report for the year ended
December 31, 1999 on Form 10-K, filed with the Securities and
Exchange Commission (the "Commission") on March 24, 2000
Kimberly-Clark has been engaged in a wide variety of diversified
businesses, including the manufacture and sale of consumer products,
paper and forest products, airline services and various other
businesses, and in recent years has been undergoing a transition to a
global consumer products company based on the strategy of building
its tissue, personal care and health care businesses. Kimberly-Clark
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
(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 Kimberly-Clark pursuant to the Exchange Act can be
located by reference to Commission file number 1-225. In addition,
information regarding Kimberly-Clark 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 KIMBERLY-CLARK STOCK OR OTHER SECURITIES OF
KIMBERLY-CLARK. WE HAVE DERIVED ALL DISCLOSURES CONTAINED IN THIS
PRICING SUPPLEMENT REGARDING KIMBERLY-CLARK 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 KIMBERLY-CLARK 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 KIMBERLY-CLARK 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 KIMBERLY- CLARK 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 KIMBERLY-CLARK COULD AFFECT THE VALUE RECEIVED ON
PS-16
<PAGE>
ANY EXCHANGE DATE OR CALL DATE WITH RESPECT TO THE NOTES AND THEREFORE
THE TRADING PRICES OF THE NOTES.
NEITHER WE NOR ANY OF OUR AFFILIATES MAKES ANY REPRESENTATION TO YOU
AS TO THE PERFORMANCE OF KIMBERLY-CLARK STOCK.
We or our subsidiaries may presently or from time to time engage in
business with Kimberly-Clark, including extending loans to, or making
equity investments in, Kimberly-Clark or providing advisory services
to Kimberly-Clark, including merger and acquisition advisory services.
In the course of such business, we or our subsidiaries may acquire
non-public information with respect to Kimberly-Clark and, in
addition, one or more of our affiliates may publish research reports
with respect to Kimberly-Clark. 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 Kimberly-Clark as in
your judgment is appropriate to make an informed decision with respect
to an investment in Kimberly-Clark 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
$64.50. 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 Kimberly-Clark Stock as
an indication of future performance. We cannot give any assurance
that the price of Kimberly-Clark 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.
</TABLE>
<TABLE>
Kimberly-Clark Stock High Low Dividend
-------------------- ---- --- --------
<S> <C> <C> <C>
(CUSIP 494368103)
1997
First Quarter................... 55 47 11/16 0.23
Second Quarter.................. 56 1/4 47 0.24
Third Quarter................... 53 1/2 44 5/8 0.24
Fourth Quarter.................. 53 3/4 47 5/16 0.24
1998
First Quarter................... 58 15/16 47 1/2 0.24
Second Quarter.................. 52 1/8 44 3/4 0.25
Third Quarter................... 49 1/16 37 3/8 0.25
Fourth Quarter.................. 54 15/16 40 5/16 0.25
1999
First Quarter................... 54 45 3/4 0.25
Second Quarter.................. 63 1/2 48 5/8 0.26
Third Quarter................... 62 1/16 52 3/4 0.26
Fourth Quarter ................. 68 1/4 51 9/16 0.26
2000
First Quarter................... 67 3/8 45 3/8 0.26
Second Quarter.................. 62 9/16 54 27/256 0.27
Third Quarter................... 61 3/8 50 5/16 0.27
Fourth Quarter
(through November 14, 2000)... . 67 7/8 55 0.27
PS-17
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Historical prices have been adjusted for a "two-for-one" stock split
that became effective in the second quarter of 1997.
We make no representation as to the amount of dividends, if any, that
Kimberly-Clark 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 Kimberly-Clark 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 Kimberly-Clark 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 Kimberly-Clark Stock. Our purchase activity could have
potentially increased the price of Kimberly-Clark Stock, and therefore
effectively have increased the level to which Kimberly-Clark Stock
must rise before you would receive an amount of Kimberly-Clark 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 Kimberly-Clark Stock, options contracts on
Kimberly-Clark 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 Kimberly-Clark 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
</TABLE>
<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 Kimberly-Clark Corporation) of Morgan Stanley Dean
Witter & Co. (CUSIP No. 617446GC7) (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. 45 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 Kimberly-Clark
Corporation or cash 3 business days after the Exchange Date in accordance with
the terms of the Notes, as described in the Pricing Supplement.
Very truly yours,
------------------------------------------
[Name of Holder]
By:
---------------------------------------
[Title]
------------------------------------------
[Fax No.]
$
-----------------------------------------
Principal Amount of Notes surrendered for
exchange
Receipt of the above Official
Notice of Exchange is hereby acknowledged
MORGAN STANLEY DEAN WITTER & CO., as Issuer
MORGAN STANLEY & CO. INCORPORATED, as Calculation Agent
By MORGAN STANLEY & CO. INCORPORATED, as Calculation Agent
By:
--------------------------------------
Title:
Date and time of acknowledgment__________
A-1
