<PAGE>
TCW/DW TERM TRUST 2000
Letter to the Shareholders September 30, 2000
Two World Trade Center, New York, New York 10048
DEAR SHAREHOLDER:
For the 12 months ended September 30, 2000, the net asset value of TCW/DW Term
Trust 2000 increased from $9.82 to $10.02 per share. Based on this change, and
including reinvestment of dividends totaling approximately $0.34 per share, the
Trust's total return for the period was 5.66 percent. Over the same period, the
market price of the Trust's shares on the New York Stock Exchange (NYSE)
increased from $9.375 to $9.8125 per share. Based on this change, and including
reinvestment of dividends, the Trust's total return for the period was 8.39
percent.
THE MARKET
The long-awaited evidence of slowing economic growth finally emerged in June,
boosting returns in most sectors of the U.S. bond market. The bond market
rallied for much of the summer on evidence of moderating economic growth and
benign inflation reports. By August 24, the 30-year benchmark U.S. Treasury
bond had fallen to 5.66 percent, its low to date for the year. But rising oil
prices and a heavy new-issue calendar in the corporate sector soon caused
yields in the intermediate to long end of the curve to move higher. By mid
September, the yield on the 30-year Treasury had risen to 5.95 percent.
However, declines in the stock market, along with a retreat in crude oil prices
in the final trading sessions of September, boosted Treasury returns and
brought yields on 10- and 30-year benchmark Treasuries back down to 5.80
percent and 5.88 percent, respectively, by quarter-end.
Changes in market expectations caused the yield curve to become less inverted
over the summer. The yield on the 10-year Treasury bond fell below the yield on
the 30-year for the first time since mid January. With further rate hikes by
the Fed considered unlikely, investors sold long-term Treasuries and reinvested
in higher-yielding securities at the short end of the curve and in the
corporate sector. Long-term Treasuries also fell out of favor amid a growing
consensus that the new administration will be less committed to eliminating
Treasury debt than was the Clinton
<PAGE>
TCW/DW TERM TRUST 2000
Letter to the Shareholders September 30, 2000, continued
administration. Diminished concern over a reduction in the supply of
outstanding Treasury debt caused spreads on GNMAs to cheapen relative to FNMAs
and FHLMCs, as the full faith and credit guarantee lost importance in the
marketplace. Mortgage spreads to Treasuries tightened, resulting in substantial
performance gains for the mortgage sector relative to other fixed-income areas.
THE PORTFOLIO
As of September 30, 2000, approximately 14 percent of the Trust's portfolio is
invested in mortgage pass-through securities issued by U.S. government agencies
or AAA-rated collateralized mortgage obligations (CMOs) with durations, average
lives or expected maturity dates that corresponded closely to the termination
date of the Trust. An additional 2 percent was invested in inverse
floating-rate CMOs issued by U.S. government agencies. Inverse floaters have
coupons that reset by a multiple in a direction opposite to that of a specified
index. Approximately 60 percent was invested in AAA-rated short-term
investments. Slightly less than 6 percent of the portfolio was invested in
asset-backed securities and the remaining 18 percent was invested in cash and a
U.S. agency debenture.
LOOKING AHEAD
Oil prices have recently declined because of a release from the Strategic
Petroleum Reserve; however, the outlook remains very precarious, due to recent
turmoil in the Middle East. TCW Investment Management Company (TCW), the Fund's
adviser, believes that any disruption in oil could adversely affect Europe far
more than the U.S., further strengthening the dollar vis-a-vis the yen and the
euro. Furthermore, the markets have become increasingly concerned about
earnings prospects. With the Fed well aware of these potential risks, the
possibility of a Fed rate hike seems remote. TCW believes that the outlook for
mortgages is very favorable. According to TCW, this asset class has far less
exposure to economic slowdowns than do the credit sectors due to U.S.
government and agency guarantees. Other variables that affect mortgages on both
a fundamental and a technical basis are highly positive. First, supply is
decreasing as a result of a slowing housing market and an increase in consumer
preference for adjustable as opposed to fixed-rate mortgage loans.
Interest-rate volatility has also declined, because the Fed appears to be on
hold for the time being. Furthermore, prepayments are relatively modest now
and, more importantly, the mortgage index is trading at a discount to par,
which means that every prepayment leads to an increase rather than a decrease
in return. TCW anticipates that more money will flow into mortgage-backed
securities this quarter as managers attempt to minimize credit risk and avoid
the low Treasury yields. These factors all promote further tightening and
performance gains.
2
<PAGE>
TCW/DW TERM TRUST 2000
Letter to the Shareholders September 30, 2000, continued
The Trust's net asset value and NYSE market values will continue to fluctuate
in response to changes in market conditions and interest rates. As stated in
the Trust's original prospectus, the Trust's income and dividends are expected
to decline over the term of the Trust and as the Trust approaches its
termination date.
We would like to remind you that the Trustees have approved a procedure whereby
the Trust may attempt, when appropriate, to reduce or eliminate a market value
discount from net asset value by repurchasing shares in the open market or in
privately negotiated transactions at a price not above market value or net
asset value, whichever is lower at the time of purchase. During the period
under review, the Trust purchased 23,600 shares of common stock at a weighted
average market discount of 3.05 percent.
PLAN OF LIQUIDATION ANNOUNCED
On October 26, 2000, the Board of Trustees of TCW/DW Term Trust 2000 adopted a
plan of liquidation and announced that the termination date of the Trust is
scheduled for December 18, 2000. In preparation for termination, the Trust has
determined that the last day of trading of the Trust's shares on the New York
Stock Exchange (NYSE Symbol: TDT) will be December 8, 2000 and, after the close
of business on that date, shareholders will no longer be able to sell their
shares on the New York Stock Exchange. All shareholders of record as of
December 8, 2000 will receive a final distribution on December 18, 2000, which
will constitute a final liquidating distribution representing all or
substantially all of the net assets of the Trust.
We appreciate your ongoing support of TCW/DW Term Trust 2000 and look forward
to continuing to serve your investment needs.
Very truly yours,
/s/ Charles A. Fiumefreddo /s/ Mitchell M. Merin
-------------------------- ---------------------
CHARLES A. FIUMEFREDDO MITCHELL M. MERIN
Chairman of the Board President
3
<PAGE>
TCW/DW TERM TRUST 2000
Portfolio of Investments September 30, 2000
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
----------- ----------- ----------- ----------------
<S> <C> <C> <C> <C>
U.S. GOVERNMENT AGENCY (17.8%)
$ 80,000 Federal Home Loan Banks (Cost $79,774,000) .................... 5.965 % 12/01/00 $ 79,862,400
-------------
U.S. GOVERNMENT AGENCY MORTGAGE PASS-THROUGH SECURITIES (10.9%)
21,817 Federal Home Loan Mortgage Corp. PC Gold ...................... 7.00 08/01/01-
11/01/01 21,763,569
23,126 Federal National Mortgage Assoc. .............................. 6.00 11/01/00-
08/01/01 22,973,009
4,146 Government National Mortgage Assoc. II ARM .................... 7.375 06/20/25 4,179,689
-------------
TOTAL U.S. GOVERNMENT AGENCY MORTGAGE PASS-THROUGH SECURITIES
(Cost $49,171,137) .................................................................... 48,916,267
-------------
ASSET-BACKED SECURITIES (5.9%)
7,308 Americredit Auto Receivable Trust 1999-D A1 ................... 6.41 02/12/02 7,294,247
8,177 Empire Funding Home Loan 1997-4 A3 ............................ 7.11 07/25/14 8,137,067
10,959 IKON 1999-2 A2 ................................................ 6.31 05/15/01 10,953,452
-------------
TOTAL ASSET-BACKED SECURITIES
(Cost $26,494,099) .................................................................... 26,384,766
-------------
COLLATERALIZED MORTGAGE OBLIGATIONS (4.6%)
U.S. GOVERNMENT AGENCIES
3,367 Federal Home Loan Mortgage Corp. 1604 JD ...................... 2.534+ 11/15/08 3,228,395
2,142 Federal Home Loan Mortgage Corp. 1635 IB (PAC) ................ 0.14 + 12/15/08 2,068,922
2,098 Federal Home Loan Mortgage Corp. 1671 MB (PAC) ................ 5.512+ 02/15/24 1,874,367
1,503 Federal Home Loan Mortgage Corp. 1680 EA (PAC) ................ 6.50 02/15/24 1,483,641
11,851 Federal National Mortgage Assoc. 1994-93 PE (PAC) ............. 7.25 03/25/18 11,813,762
57 Federal National Mortgage Assoc. 1993-35 SB (PAC) ............. 6.27 + 11/25/23 58,189
-------------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS
(Cost $20,726,844) .................................................................... 20,527,276
-------------
SHORT-TERM INVESTMENTS (a) (60.4%)
COMMERCIAL PAPER
Air Freight/Couriers (4.8%)
22,000 United Parcel Service ......................................... 6.12 12/15/00 21,695,080
-------------
Chemical: Major Diversified (4.9%)
22,000 Dupont (E.I.) de Nemours & Co. ................................ 6.45- 10/06/00-
6.61 12/18/00 21,927,523
-------------
Finance - Automotive (4.7%)
21,250 USAA Capital Corp. ............................................ 6.46- 10/02/00-
6.47 11/29/00 21,135,324
-------------
Finance - Corporate (4.9%)
21,965 Ciesco L.P. ................................................... 6.46- 10/06/00-
6.50 11/20/00 21,834,352
-------------
Finance/Rental/Leasing (6.0%)
5,000 International Lease Finance Corp. ............................. 6.44 11/16/00 4,957,961
22,000 Pitney Bowes Credit Corp. ..................................... 6.47 10/10/00-
10/12/00 21,956,866
-------------
26,914,827
-------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
4
<PAGE>
TCW/DW TERM TRUST 2000
Portfolio of Investments September 30, 2000, continued
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT IN COUPON MATURITY
THOUSANDS RATE DATE VALUE
----------- ----------- ------------- ---------------
<S> <C> <C> <C> <C>
Financial Conglomerates (9.0%)
$ 21,700 General Electric Capital Corp. .................. 6.07- % 10/02/00-
6.26 12/22/00 $ 21,589,722
19,000 General Electric Capital Services Inc. .......... 6.07- 10/03/00-
6.22 10/06/00 18,980,798
------------
40,570,520
------------
Foods & Beverages (5.1%)
22,000 Nestle Capital Corp. ............................ 6.53- 10/02/00-
6.54 10/03/00 21,991,102
1,000 Sara Lee Corp. .................................. 6.47 10/06/00 998,922
------------
22,990,024
------------
Insurance (4.7%)
21,500 American General Corp. .......................... 6.47- 10/10/00-
6.53 12/22/00 21,214,027
------------
Integrated Oil (1.0%)
4,500 Chevron U.S.A. Inc. ............................. 6.47 10/06/00 4,495,148
------------
Investment Bankers/Brokers (4.9%)
22,000 Goldman, Sachs & Co. ............................ 6.48- 11/13/00-
6.53 11/17/00 21,819,983
------------
Life/Health Insurance (3.6%)
16,000 MetLife Funding Inc. ............................ 6.47- 10/02/00-
6.48 10/16/00 15,969,043
------------
Major Telecommunications (1.3%)
6,000 BellSouth Telecommunications Inc. ............... 6.47- 10/06/00-
6.50 11/22/00 5,967,744
------------
Oil & Gas Pipelines (3.3%)
15,000 Northern Illinois Gas Co. ....................... 6.55 10/05/00 14,986,354
------------
Pharmaceuticals: Major (2.2%)
10,000 Schering Corp. .................................. 6.48 10/10/00 9,981,785
------------
TOTAL SHORT-TERM INVESTMENTS (Cost $271,583,333) .......................... 271,501,734
------------
TOTAL INVESTMENTS (Cost $447,749,413) (b) .................... 99.6% 447,192,443
OTHER ASSETS IN EXCESS OF LIABILITES ......................... 0.4 1,728,881
--------- ------------
NET ASSETS ................................................... 100.0% $448,921,324
========= ============
</TABLE>
---------------
ARM Adjustable rate mortgage.
PC Participation Certificate.
PAC Planned Amortization Class.
+ Inverse floater: interest rate moves inversely to a designated index,
such as LIBOR (London Inter-Bank Offered Rate) or COFI (Cost of Funds
Index), typically at a multiple of the changes of the relevant index
rate.
(a) Purchased on a discount basis. The interest rate shown has been adjusted
to reflect a money market equivalent yield.
(b) The aggregate cost for federal income tax purposes approximates the
aggregate cost for book purposes. The aggregate gross unrealized
appreciation is $285,540 and the aggregate gross unrealized depreciation
is $842,510, resulting in net unrealized depreciation of $556,970.
SEE NOTES TO FINANCIAL STATEMENTS
5
<PAGE>
TCW/DW TERM TRUST 2000
Financial Statements
STATEMENT OF ASSETS AND LIABILITIES
September 30, 2000
<TABLE>
<CAPTION>
ASSETS:
<S> <C>
Investments in securities, at value
(cost $447,749,413)............................ $447,192,443
Cash ............................................. 40,340
Interest receivable .............................. 2,061,031
Prepaid expenses ................................. 12,252
-------------
TOTAL ASSETS ................................ 449,306,066
-------------
LIABILITIES:
Payable for:
Management fee .............................. 159,393
Investment advisory fee ..................... 106,262
Accrued expenses ................................. 119,087
Contingencies (Note 8) ........................... -
-------------
TOTAL LIABILITIES ........................... 384,742
-------------
NET ASSETS .................................. $448,921,324
=============
COMPOSITION OF NET ASSETS:
Paid-in-capital .................................. $436,886,810
Net unrealized depreciation ...................... (556,970)
Accumulated undistributed net investment
income ........................................ 26,770,414
Accumulated net realized loss .................... (14,178,930)
-------------
NET ASSETS .................................. $448,921,324
=============
NET ASSET VALUE PER SHARE,
44,820,928 shares outstanding (unlimited
shares authorized of $.01 par value)......... $ 10.02
=============
</TABLE>
STATEMENT OF OPERATIONS
For the year ended September 30, 2000
<TABLE>
<CAPTION>
NET INVESTMENT INCOME:
<S> <C>
INTEREST INCOME ............................... $28,167,088
-----------
EXPENSES
Management fee ................................ 1,596,280
Investment advisory fee ....................... 1,064,186
Transfer agent fees and expenses .............. 126,932
Professional fees ............................. 96,569
Insurance expenses ............................ 41,025
Registration fees ............................. 39,525
Shareholder reports and notices ............... 29,992
Custodian fees ................................ 12,760
Trustees' fees and expenses ................... 10,738
Other ......................................... 7,527
-----------
TOTAL EXPENSES ........................... 3,025,534
-----------
NET INVESTMENT INCOME .................... 25,141,554
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized loss ............................. (6,287,936)
Net change in unrealized depreciation ......... 5,229,536
-----------
NET LOSS ................................. (1,058,400)
-----------
NET INCREASE .................................. $24,083,154
===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
6
<PAGE>
TCW/DW TERM TRUST 2000
Financial Statements, continued
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE YEAR FOR THE YEAR
ENDED ENDED
SEPTEMBER 30, 2000 SEPTEMBER 30, 1999
-------------------- -------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income ................................ $ 25,141,554 $ 26,607,168
Net realized loss .................................... (6,287,936) (4,450,184)
Net change in unrealized depreciation ................ 5,229,536 (11,591,837)
------------- -------------
NET INCREASE ...................................... 24,083,154 10,565,147
Dividends from net investment income ................. (15,128,101) (24,352,768)
Decrease from transactions in shares of beneficial
interest ........................................... (222,970) (11,867,961)
------------- -------------
NET INCREASE (DECREASE) ........................... 8,732,083 (25,655,582)
NET ASSETS:
Beginning of period .................................. 440,189,241 465,844,823
------------- -------------
END OF PERIOD
(Including undistributed net investment income of
$26,770,414 and $16,756,961, respectively)......... $ 448,921,324 $ 440,189,241
============= =============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
7
<PAGE>
TCW/DW TERM TRUST 2000
Notes to Financial Statements September 30, 2000
1. ORGANIZATION AND ACCOUNTING POLICIES
TCW/DW Term Trust 2000 (the "Trust") is registered under the Investment Company
Act of 1940, as amended, as a diversified, closed-end management investment
company. The Trust's investment objective is to provide a high level of current
income and return $10 per share to shareholders on the termination date. The
Trust seeks to achieve its objective by investing in high quality fixed-income
securities. The Trust was organized as a Massachusetts business trust June 16,
1993 and commenced operations on November 30, 1993.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts and disclosures. Actual results could differ
from those estimates.
The following is a summary of significant accounting policies:
A. VALUATION OF INVESTMENTS - (1) portfolio securities for which
over-the-counter market quotations are readily available are valued at the
latest available bid price prior to the time of valuation; (2) when market
quotations are not readily available, including circumstances under which it is
determined by TCW Investment Management Company (the "Adviser") that sale and
bid prices are not reflective of a security's market value, portfolio
securities are valued at their fair value as determined in good faith under
procedures established by and under the general supervision of the Trustees;
(3) certain portfolio securities may be valued by an outside pricing service
approved by the Trustees. The pricing service may utilize a matrix system
incorporating security quality, maturity and coupon as the evaluation model
parameters, and/or research and evaluations by its staff, including review of
broker-dealer market price quotations, if available, in determining what it
believes is the fair valuation of the portfolio securities valued by such
pricing service; and (4) short-term debt securities having a maturity date of
more than sixty days at time of purchase are valued on a mark-to-market basis
until sixty days prior to maturity and thereafter at amortized cost based on
their value on the 61st day. Short-term debt securities having a maturity date
of sixty days or less at the time of purchase are valued at amortized cost.
B. ACCOUNTING FOR INVESTMENTS - Security transactions are accounted for on the
trade date (date the order to buy or sell is executed). Realized gains and
losses on security transactions are determined by the identified cost method.
The Trust amortizes premiums and accretes discounts over the life of the
respective securities. Interest income is accrued daily.
C. FEDERAL INCOME TAX STATUS - It is the Trust's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its shareholders.
Accordingly, no federal income tax provision is required.
8
<PAGE>
TCW/DW TERM TRUST 2000
Notes to Financial Statements September 30, 2000, continued
D. DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS - The Trust records dividends
and distributions to its shareholders on the record date. The amount of
dividends and distributions from net investment income and net realized capital
gains are determined in accordance with federal income tax regulations which
may differ from generally accepted accounting principles. These "book/tax"
differences are either considered temporary or permanent in nature. To the
extent these differences are permanent in nature, such amounts are reclassified
within the capital accounts based on their federal tax-basis treatment;
temporary differences do not require reclassification. Dividends and
distributions which exceed net investment income and net realized capital gains
for tax purposes are reported as distributions of paid-in-capital.
2. MANAGEMENT/INVESTMENT ADVISORY AGREEMENTS
Pursuant to a Management Agreement, the Trust pays the Morgan Stanley Dean
Witter Services Company Inc. (the "Manager") a management fee, accrued weekly
and payable monthly, by applying the annual rate of 0.36% to the Trust's weekly
net assets.
Pursuant to an Investment Advisory Agreement, the Trust pays the Adviser an
advisory fee, accrued weekly and payable monthly, by applying the annual rate
of 0.24% to the Trust's weekly net assets.
3. SECURITY TRANSACTIONS AND TRANSACTIONS WITH AFFILIATES
The cost of purchases and proceeds from sales/prepayments of portfolio
securities, excluding short-term investments, for the year ended September 30,
2000 were as follows:
<TABLE>
<CAPTION>
SALES/
PURCHASES PREPAYMENTS
------------- --------------
<S> <C> <C>
U.S. Government Agencies .................................. $8,032,760 $166,263,695
Private Issue Collateralized Mortgage Obligations ......... 1,036,992 93,413,136
Asset-Backed Securities ................................... 25,912,776 37,531,784
Municipal Bonds ........................................... - 51,562,837
</TABLE>
Morgan Stanley Dean Witter Trust FSB, an affiliate of the Manager, is the
Trust's transfer agent. At September 30, 2000, the Trust had transfer agent
fees and expenses payable of approximately $650.
9
<PAGE>
TCW/DW TERM TRUST 2000
Notes to Financial Statements September 30, 2000, continued
4. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest were as follows:
<TABLE>
<CAPTION>
CAPITAL
PAID IN
PAR VALUE EXCESS OF
SHARES OF SHARES PAR VALUE
--------------- ------------- ---------------
<S> <C> <C> <C>
Balance, September 30, 1998 ............................................. 46,077,428 $460,774 $448,516,967
Treasury shares purchased and retired (weighted average discount 2.85%)* (1,232,900) (12,329) (11,855,632)
---------- -------- ------------
Balance, September 30, 1999 ............................................. 44,844,528 448,445 436,661,335
Treasury shares purchased and retired (weighted average discount 3.05%)* (23,600) (236) (222,734)
---------- -------- ------------
Balance, September 30, 2000 ............................................. 44,820,928 $448,209 $436,438,601
========== ======== ============
</TABLE>
---------------
* The Trustees have voted to retire the shares purchased.
5. FEDERAL INCOME TAX STATUS
At September 30, 2000, the Trust had a net capital loss carryover of
approximately $8,217,000, which will be available to offset future capital
gains to the extent provided by regulations.
Capital losses incurred after October 31 ("post-October" losses) within the
taxable year are deemed to arise on the first business day of the Trust's next
taxable year. The Trust incurred and will elect to defer net capital losses of
approximately $5,962,000, during fiscal 2000.
6. REVERSE REPURCHASE AND DOLLAR ROLL AGREEMENTS
Reverse repurchase and dollar roll agreements involve the risk that the market
value of the securities the Trust is obligated to repurchase under the
agreement may decline below the repurchase price. In the event the buyer of
securities under a reverse repurchase or dollar roll agreement files for
bankruptcy or becomes insolvent, the Trust's use of proceeds may be restricted
pending a determination by the other party, its trustee or receiver, whether to
enforce the Trust's obligation to repurchase the securities.
During the year ended September 30, 2000, there were no outstanding reverse
repurchase or dollar roll agreements.
10
<PAGE>
TCW/DW TERM TRUST 2000
Notes to Financial Statements September 30, 2000, continued
7. DIVIDENDS
The Trust declared the following dividends from net investment income:
<TABLE>
<CAPTION>
DECLARATION AMOUNT PER RECORD PAYABLE
DATE SHARE DATE DATE
-------------------- ------------ ------------------ -----------------
<S> <C> <C> <C>
September 26, 2000 $0.02 October 6, 2000 October 20, 2000
</TABLE>
8. LITIGATION
Four purported class actions lawsuits have been filed in the Superior Court for
the State of California, County of Orange, against some of the Trust's Trustees
and officers, one of its underwriters, the lead representative of its
underwriters, the Adviser, the Manager and other defendants - but not against
the Trust - by certain shareholders of the Trust and other trusts for which the
defendants act in similar capacities. These plaintiffs generally allege
violations of state statutory and common law in connection with the marketing
of the Trust to customers of one of the underwriters. Damages, including
punitive damages, are sought in an unspecified amount. On or about October 20,
1995, the plaintiffs filed an amended complaint consolidating these four
actions. The defendants thereafter filed answers and affirmative defenses to
the consolidated amended complaint. The defendants' answers deny all of the
material allegations of the plaintiff's complaint. In 1996, the plaintiffs
voluntarily dismissed, without prejudice, their claims against two defendants
who were independent Trustees of the Trust. In March 1997, all of the remaining
defendants in the litigation filed motions for judgment on the pleadings,
seeking dismissal of all of the claims against them. The defendant's motions
were fully briefed by all parties and were the subject of a hearing before the
Court on April 18, 1997. In July 1997, the Court denied the motion for judgment
on the pleadings. In August, 1997, plaintiffs filed a motion for class
certification. In their motion, the plaintiffs requested certification of a
"nationwide" class of Term Trust purchasers. On June 1, 1998, the Court granted
in part and denied in part the plaintiff's motion for class certification. The
Court ruled that plaintiff's motion was "granted as to [a California] statewide
class," but was "denied as to a nationwide class." On October 13, 1998, three
separate class actions alleging similar claims on behalf of the residents of
the states of Florida, New Jersey and New York were filed in the state courts
of those states. The defendants removed the Florida action to federal court and
the plaintiffs' motion to remand the action to state court was denied. Motions
to dismiss were filed by defendants in the Florida action on August 30, 1999,
in the New Jersey action on July 26, 1999 and in the New York action on
September 10, 1999. The New Jersey action was dismissed by the court with
prejudice and no appeal was filed. The motion to dismiss the Florida action was
denied on January 27, 2000 and the litigation remains pending. The Supreme
Court of the State of New York dismissed the New York action with
11
<PAGE>
TCW/DW TERM TRUST 2000
Notes to Financial Statements September 30, 2000, continued
prejudice on April 25, 2000 and no appeal was filed. Certain of the defendants
in these suits have asserted their right to indemnification from the Trust. The
ultimate outcome of these matters is not presently determinable, and no
provision has been made in the Trust's financial statements for the effect, if
any, of such matters.
9. TERMINATION OF THE TRUST
On October 26, 2000, the Board of Trustees of the Trust adopted a plan of
liquidation and announced that the termination date of the Trust is scheduled
for December 18, 2000. In preparation for termination, the last day for trading
of the Trust's shares on the New York Stock Exchange will be December 8, 2000
and, after the close of business on that date, shareholders will no longer be
able to sell their shares on the New York Stock Exchange. All shareholders of
record as of December 8, 2000 will receive a final liquidating distribution on
December 18, 2000 equal to the net asset value of their shares on the
termination date.
12
<PAGE>
TCW/DW TERM TRUST 2000
Financial Highlights
Selected ratios and per share data for a share of beneficial interest
outstanding throughout each period:
<TABLE>
<CAPTION>
FOR THE YEAR ENDED SEPTEMBER 30,
---------------------------------------------------------------------
2000* 1999 1998 1997 1996
------------- ------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA:
Net asset value, beginning of period ..................... $ 9.82 $ 10.11 $ 9.52 $ 8.81 $ 8.71
------- ------- ------- ------- -------
Income (loss) from investment operations:
Net investment income ................................... 0.56 0.60 0.59 0.60 0.59
Net realized and unrealized gain (loss) ................. (0.02) (0.36) 0.53 0.66 (0.09)
------- -------- ------- ------- --------
Total income from investment operations .................. 0.54 0.24 1.12 1.26 0.50
------- -------- ------- ------- --------
Less dividends from net investment income ................ (0.34) (0.54) (0.56) (0.59) (0.46)
------- -------- ------- -------- --------
Anti-dilutive effect of acquiring treasury shares ........ --++ 0.01 0.03 0.04 0.06
------- -------- ------- -------- --------
Net asset value, end of period ........................... $ 10.02 $ 9.82 $ 10.11 $ 9.52 $ 8.81
======= ======== ======= ======== ========
Market value, end of period .............................. $ 9.813 $ 9.375 $ 9.688 $ 8.875 $ 7.875
======= ======== ======= ======== ========
TOTAL RETURN+ ............................................ 8.39% 2.32% 15.92% 20.80% 11.29%
RATIOS TO AVERAGE NET ASSETS:
Operating expenses ....................................... 0.68% 0.71% 0.73% 0.71% 0.73%
Interest expense ......................................... -- 0.27% 1.31% 1.69% 1.66%
Total expenses ........................................... 0.68% 0.98% 2.04% 2.40% 2.39%
Net investment income .................................... 5.67% 5.95% 5.84% 6.33% 6.46%
SUPPLEMENTAL DATA:
Net assets, end of period, in thousands .................. $448,921 $440,189 $465,845 $466,424 $459,223
Portfolio turnover rate .................................. 14% 35% 5% 13% 31%
</TABLE>
-------------
* The per share amounts were computed using an average number of shares
outstanding during the period.
+ Total return is based upon the current market value on the last day of each
period reported. Dividends and distributions are assumed to be reinvested
at the prices obtained under the Trust's reinvestment plan. Total return
does not reflect brokerage commissions.
++ Amount less than $0.01 per share.
SEE NOTES TO FINANCIAL STATEMENTS
13
<PAGE>
TCW/DW TERM TRUST 2000
Independent Auditors' Report
TO THE SHAREHOLDERS AND BOARD OF TRUSTEES
OF TCW/DW TERM TRUST 2000:
We have audited the accompanying statement of assets and liabilities of TCW/DW
Term Trust 2000 (the "Trust"), including the portfolio of investments, as of
September 30, 2000, and the related statements of operations and changes in net
assets, and the financial highlights for the year then ended. These financial
statements and financial highlights are the responsibility of the Trust's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audit. The statement of
changes in net assets for the year ended September 30, 1999 and the financial
highlights for each of the respective stated periods ended September 30, 1999
were audited by other independent accountants whose report, dated November 9,
1999, expressed an unqualified opinion on that statement and financial
highlights.
We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation
of securities owned as of September 30, 2000, by correspondence with the
custodian. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
TCW/DW Term Trust 2000 as of September 30, 2000, the results of its operations,
the changes in its net assets, and the financial highlights for the year then
ended, in conformity with accounting principles generally accepted in the
United States of America.
Deloitte & Touche LLP
New York, New York
November 8, 2000
--------------------------------------------------------------------------------
2000 FEDERAL TAX NOTICE (unaudited)
Of the Trust's ordinary income dividends paid during the fiscal year
ended September 30, 2000, 11.93% was attributable to qualifying Federal
obligations. Please consult your tax advisor to determine if any portion
of the dividends you received is exempt from state income tax.
--------------------------------------------------------------------------------
14
<PAGE>
TCW/DW TERM TRUST 2000
Change in Independent Accountants
On July 1, 2000 PricewaterhouseCoopers LLP resigned as independent accountants
of the Trust.
The reports of PricewaterhouseCoopers LLP on the financial statements of the
Trust for the past two fiscal years contained no adverse opinion or disclaimer
of opinion and were not qualified or modified as to uncertainty, audit scope or
accounting principle.
In connection with its audits for the two most recent fiscal years and through
July 1, 2000, there have been no disagreements with PricewaterhouseCoopers LLP
on any matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which disagreements if not resolved
to the satisfaction of PricewaterhouseCoopers LLP would have caused them to
make reference thereto in their report on the financial statements for such
years.
The Trust, with the approval of its Board of Trustees and its Audit Committee,
engaged Deloitte & Touche LLP as its new independent accountants as of July 1,
2000.
15
<PAGE>
TRUSTEES
Michael Bozic
Charles A. Fiumefreddo
Edwin J. Garn
Wayne E. Hedien
James F. Higgins
Dr. Manuel H. Johnson
Michael E. Nugent
Philip J. Purcell
John L. Schroeder
OFFICERS
Charles A. Fiumefreddo
Chairman and Chief Executive Officer
Mitchell M. Merin
President
Barry Fink
Vice President, Secretary and
General Counsel
Philip A. Barach
Vice President
Jeffrey E. Gundlach
Vice President
Frederick H. Horton
Vice President
Thomas F. Caloia
Treasurer
TRANSFER AGENT
Morgan Stanley Dean Witter Trust FSB
Harborside Financial Center - Plaza Two
Jersey City, New Jersey 07311
INDEPENDENT ACCOUNTANTS
Deloitte & Touche LLP
Two World Financial Center
New York, New York 10281
MANAGER
Morgan Stanley Dean Witter Services Company Inc.
Two World Trade Center
New York, New York 10048
ADVISER
TCW Investment Management Company
865 South Figueroa Street, Suite 1800
Los Angeles, CA 90017
TCW/DW
TERM TRUST
2000
[GRAPHIC OMITTED]
ANNUAL REPORT
SEPTEMBER 30, 2000
