<PAGE>
Schedule 14A Information required in proxy statement.
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No.__)
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Preliminary Additional Materials
[ ] Confidential, for Use of the Commission Only (as
permitted by Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.149-11(c) or
Section 240.14a-12
- --------------------------------------------------------------------------------
Dean Witter Select Dimensions Investment Series
(Name of Registrant(s) Specified in its Charter)
- --------------------------------------------------------------------------------
Marilyn K. Cranney
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (check the appropriate box):
[ x ] No fee required.
[ ] Fee computed on table below per Exchange Act Rules
14a-6(j)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
- --------------------------------------------------------------------------------
Set forth the amount on which the filing fee is calculated
and state how it was determined.
4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
5) Fee previously paid:
- --------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify
the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
- --------------------------------------------------------------------------------
2) Form, Schedule or Registration Statement No.:
- --------------------------------------------------------------------------------
3) Filing Party:
- --------------------------------------------------------------------------------
4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE>
DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 20, 1997
Notice is hereby given that a Special Meeting of Shareholders of DEAN WITTER
SELECT DIMENSIONS INVESTMENT SERIES (the "Fund") will be held in the Career
Development Room, 61st Floor, 2 World Trade Center, New York, New York 10048, on
May 20, 1997 (the "Meeting"), at 2:00 p.m., New York City time, for the
following purposes:
1. For each Portfolio, to approve or disapprove a new Investment Management
Agreement between the Fund and Dean Witter InterCapital Inc., a
wholly-owned subsidiary of Dean Witter, Discover & Co. ("DWDC"), in
connection with the proposed merger of Morgan Stanley Group Inc. with
DWDC;
2. To approve or disapprove new Sub-Advisory Agreements between Dean Witter
InterCapital Inc. and TCW Funds Management, Inc. ("TCW"), in connection
with the proposed merger of Morgan Stanley Group Inc. with DWDC, and, in
the case of the Emerging Markets Portfolio, related new Secondary Sub-
Advisory Agreements between TCW and each of TCW Asia Limited and TCW
London International, Limited (TO BE VOTED ON BY SHAREHOLDERS OF EACH OF
THE NORTH AMERICAN GOVERNMENT SECURITIES PORTFOLIO, THE BALANCED
PORTFOLIO, THE CORE EQUITY PORTFOLIO AND THE EMERGING MARKETS PORTFOLIO
ONLY);
3. To elect nine (9) Trustees to serve until their successors shall have
been elected and qualified;
4. To ratify or reject the selection of Price Waterhouse LLP as the Fund's
independent accountants for its current fiscal year; and
5. To transact such other business as may properly come before the Meeting
or any adjournments thereof.
Shareholders of record as of the close of business on March 12, 1997 are
entitled to notice of and to vote at the Meeting. If you cannot be present in
person, your management would greatly appreciate your filling in, signing and
returning the enclosed proxy promptly in the envelope provided for that purpose.
In the event that the necessary quorum to transact business or the vote
required to approve or reject any proposal is not obtained at the Meeting with
respect to the Fund or, if applicable, one or more Portfolios, the persons named
as proxies may propose one or more adjournments of the Meeting for a total of
not more than 60 days in the aggregate to permit further solicitation of
proxies. Any such adjournment will require the affirmative vote of the holders
of a majority of the Fund's or, if applicable, the concerned Portfolio's shares
present in person or by proxy at the Meeting. The persons named as proxies will
vote in favor of such adjournment those proxies which they are entitled to vote
in favor of Proposal 1 and will vote against any such adjournment those proxies
to be voted against that Proposal.
BARRY FINK
March 19, 1997 SECRETARY
New York, New York
IMPORTANT
YOU CAN HELP AVOID THE NECESSITY AND EXPENSE OF SENDING FOLLOW-UP
LETTERS TO ENSURE A QUORUM BY PROMPTLY RETURNING THE ENCLOSED PROXY. IF YOU
ARE UNABLE TO BE PRESENT IN PERSON, PLEASE FILL IN, SIGN AND RETURN THE
ENCLOSED PROXY IN ORDER THAT THE NECESSARY QUORUM MAY BE REPRESENTED AT THE
MEETING. THE ENCLOSED ENVELOPE REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES.
<PAGE>
THE BOARD OF TRUSTEES RECOMMENDS THAT YOU CAST YOUR VOTE:
- FOR approval of the new Investment Management Agreement.
- FOR approval of the new Sub-Advisory Agreements and, in the case of the
Emerging Markets Portfolio, the related new Secondary Sub-Advisory
Agreements (NORTH AMERICAN GOVERNMENT SECURITIES PORTFOLIO, BALANCED
PORTFOLIO, CORE EQUITY PORTFOLIO AND EMERGING MARKETS PORTFOLIO ONLY).
- FOR the election of all of the Trustees nominated for election.
- FOR the ratification of the selection of independent public accountants.
YOUR VOTE IS IMPORTANT
2
<PAGE>
DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES
TWO WORLD TRADE CENTER, NEW YORK, NEW YORK 10048
---------------------
PROXY STATEMENT
---------------------
SPECIAL MEETING OF SHAREHOLDERS
MAY 20, 1997
This statement is furnished in connection with the solicitation of proxies
by the Board of Trustees (the "Board" or "Trustees") of DEAN WITTER SELECT
DIMENSIONS INVESTMENT SERIES (the "Fund") for use at the Special Meeting of
Shareholders of the Fund to be held on May 20, 1997 (the "Meeting"), and at any
adjournments thereof. The first mailing of this Proxy Statement is expected to
be made on or about March 19, 1997.
If the enclosed form of proxy is properly executed and returned in time to
be voted at the Meeting, the proxies named therein will vote the shares
represented by the proxy in accordance with the instructions marked thereon.
Unmarked proxies will be voted for each of the nominees for election as Trustee
and in favor of Proposals 1, 2 and 4 set forth in the attached Notice of Special
Meeting of Shareholders. A proxy may be revoked at any time prior to its
exercise by any of the following: written notice of revocation to the Secretary
of the Fund, execution and delivery of a later dated proxy to the Secretary of
the Fund (if returned and received in time to be voted), or attendance and
voting at the Meeting. Attendance at the Meeting will not in and of itself
revoke a proxy.
The table below sets forth each Proposal and those Shareholders who are
entitled to vote for each such Proposal.
<TABLE>
<CAPTION>
PORTFOLIO OF THE FUND PROPOSAL
1 2 3 4
<S> <C> <C> <C> <C>
North American Government Securities
Portfolio x x x x
Balanced Portfolio x x x x
Core Equity Portfolio x x x x
Emerging Markets Portfolio x x x x
All other Portfolios x x x
</TABLE>
The holders of shares ("Shareholders") of each Portfolio of the Fund (each,
a "Portfolio") of record as of the close of business on March 12, 1997, the
record date for the determination of Shareholders entitled to notice of and to
vote at the Meeting (the "Record Date"), are entitled to one vote for each share
held and a fractional vote for a fractional share. The table below sets forth
the number of shares outstanding for each Portfolio as of the
3
<PAGE>
Record Date. The percentage ownership of shares of the Fund changes from time to
time depending on purchases and redemptions by Shareholders and the total number
of shares outstanding.
<TABLE>
<CAPTION>
NUMBER OF SHARES
OUTSTANDING AS OF
MARCH 12, 1997
NAME OF PORTFOLIO (RECORD DATE)
- --------------------------------------------------------------------------------- -----------------
<S> <C>
Money Market Portfolio........................................................... 86,334,321
North American Government Securities Portfolio................................... 446,420
Diversified Income Portfolio..................................................... 3,673,561
Balanced Portfolio............................................................... 3,480,817
Utilities Portfolio.............................................................. 2,818,742
Dividend Growth Portfolio........................................................ 17,784,629
Value-Added Market Portfolio..................................................... 5,817,174
Core Equity Portfolio............................................................ 1,623,587
American Value Portfolio......................................................... 8,746,080
Mid-Cap Growth Portfolio......................................................... 389,851
Global Equity Portfolio.......................................................... 5,502,296
Developing Growth Portfolio...................................................... 3,808,956
Emerging Markets Portfolio....................................................... 1,762,150
</TABLE>
The shares of the Fund are currently sold only to (1) Hartford Life
Insurance Company for allocation to certain of its separate accounts established
to fund the benefits under certain flexible premium deferred variable annuity
contracts and certain flexible premium variable life insurance policies it
issues, and to (2) ITT Hartford Life and Annuity Insurance Company for
allocation to certain of its separate accounts established to fund the benefits
under certain flexible premium deferred variable annuity contracts and certain
flexible premium variable life insurance policies it issues. Such separate
accounts are sometimes referred to individually as an "Account" and collectively
as the "Accounts." The variable annuity contracts issued by Hartford Life
Insurance Company and ITT Hartford Life and Annuity Insurance Company are
sometimes referred to as the "Variable Annuity Contracts." The variable life
insurance policies issued by Hartford Life Insurance Company and ITT Hartford
Life and Annuity Insurance Company are sometimes referred to as the "Variable
Life Policies." The Variable Annuity Contracts and the Variable Life Policies
are sometimes referred to as the "Contracts."
In accordance with their view of currently applicable law, Hartford Life
Insurance Company and ITT Hartford Life and Annuity Insurance Company will vote
the shares of each of the Portfolios held in the applicable Account based on
instructions received from the owners of Contracts ("Contract Owners") having
the voting interest in the corresponding Sub-Accounts of the Account. In
connection with the solicitation of such instructions from such Contract Owners,
it is understood and expected that Hartford Life Insurance Company and ITT
Hartford Life and Annuity Insurance Company will furnish a copy of this Proxy
Statement to Contract Owners and that Hartford Life Insurance Company and ITT
Hartford Life and Annuity Insurance Company will furnish to Contract Owners one
or more instruction cards by which the Contract Owners may provide their
instructions to Hartford Life Insurance Company and ITT Hartford Life and
Annuity Insurance Company. Shares for which no instructions are received in time
to be voted will be voted by Hartford Life Insurance Company and ITT Hartford
Life and Annuity Insurance Company in the same proportion as shares for which
instructions have been received in time to be voted.
The cost of soliciting proxies for the Meeting, which consists principally
of printing and mailing expenses and which is expected to be approximately
$46,500, will be allocated as follows: 90% of the cost will be borne by Dean
Witter, Discover & Co., and 10% of the cost will be borne by the Fund. The total
cost of soliciting proxies borne by each Portfolio is estimated to be
approximately $358. The solicitation of proxies will be by mail, which may be
4
<PAGE>
supplemented by solicitation by mail, telephone or otherwise through Trustees
and officers of the Funds and officers and regular employees of certain
affiliates of the Fund, including Dean Witter InterCapital Inc., Dean Witter
Trust Company, Dean Witter Services Company Inc. and/or Dean Witter Reynolds
Inc., without special compensation.
(1) APPROVAL OR DISAPPROVAL OF NEW INVESTMENT
MANAGEMENT AGREEMENT
BACKGROUND
Dean Witter InterCapital Inc. (the "Investment Manager" or "InterCapital")
currently serves as investment manager of the Fund pursuant to an investment
management agreement entered into by the Fund and InterCapital (the "Current
Agreement"), and in that capacity provides investment advisory and certain other
services to each Portfolio of the Fund other than the North American Government
Securities Portfolio, the Balanced Portfolio, the Core Equity Portfolio and the
Emerging Markets Portfolio. Pursuant to the Current Agreement, the Fund has
retained InterCapital to supervise the management of the assets of the North
American Government Securities Portfolio, the Balanced Portfolio, the Core
Equity Portfolio and the Emerging Markets Portfolio. InterCapital is a
wholly-owned subsidiary of Dean Witter, Discover & Co. ("DWDC"). The approval of
a new investment management agreement between the Fund and InterCapital (the
"New Agreement") is being sought in connection with the proposed merger of
Morgan Stanley Group Inc. ("Morgan Stanley") and DWDC (the "Merger").
INFORMATION CONCERNING MORGAN STANLEY
Morgan Stanley and various of its directly or indirectly owned subsidiaries,
including Morgan Stanley & Co. Incorporated ("Morgan Stanley & Co."), a
registered broker-dealer and investment adviser, and Morgan Stanley
International, provide a wide range of financial services on a global basis.
Their principal businesses include securities underwriting, distribution and
trading; merger, acquisition, restructuring, real estate, project finance and
other corporate finance advisory activities; merchant banking and other
principal investment activities; stock brokerage and research services; asset
management; the trading of foreign exchange and commodities on a broad range of
asset categories, rates and indices; and global custody, securities clearance
services and securities lending.
THE MERGER
Pursuant to the terms of the Merger, Morgan Stanley will be merged with and
into DWDC with the surviving corporation to be named Morgan Stanley, Dean
Witter, Discover & Co. Following the Merger, InterCapital will be a direct
wholly-owned subsidiary of Morgan Stanley, Dean Witter, Discover & Co.
Under the terms of the Merger, each share of Morgan Stanley common stock
will be converted into the right to receive 1.65 shares of DWDC common stock and
each issued and outstanding share of DWDC common stock will remain outstanding
and will thereafter represent one share of Morgan Stanley, Dean Witter, Discover
& Co. common stock. Following the Merger, Morgan Stanley's shareholders will own
approximately 45% and DWDC's shareholders will own approximately 55% of the
outstanding shares of common stock of Morgan Stanley, Dean Witter, Discover &
Co.
The Board of Directors of Morgan Stanley, Dean Witter, Discover & Co. will
consist of fourteen members, two of which will be Morgan Stanley insiders and
two of which will be DWDC insiders. The remaining ten directors will be outside
directors, with Morgan Stanley and DWDC each designating five of the ten. The
Chairman and Chief Executive Officer of Morgan Stanley, Dean Witter, Discover &
Co. will be Philip J. Purcell, who is the current Chairman and Chief Executive
Officer of DWDC. The President and Chief Operating Officer
5
<PAGE>
of Morgan Stanley, Dean Witter, Discover & Co. will be John Mack, who is the
current President of Morgan Stanley.
The Merger is expected to be completed in mid-1997 and is subject to certain
closing conditions, including certain regulatory approvals and the approval of
shareholders of both DWDC and Morgan Stanley.
APPROVAL OF NEW INVESTMENT MANAGEMENT AGREEMENT
In order to assure continuity of investment management services to the Fund
after the Merger, the Board of the Fund met in person for the purpose of
considering whether it would be in the best interests of each Portfolio of the
Fund and its Shareholders to enter into a New Agreement between the Fund and the
Investment Manager which would become effective upon the later of Shareholder
approval of the New Agreement or consummation of the Merger. At its meetings,
and for the reasons discussed below (see "The Board's Consideration"), the
Board, including all of the Trustees who are not "interested persons," as
defined in the Investment Company Act of 1940, as amended (the "1940 Act"), of
the Investment Manager (the "Independent Trustees"), unanimously approved the
New Agreement and recommended its approval by Shareholders.
THE TERMS OF THE NEW AGREEMENT, INCLUDING FEES PAYABLE BY THE PORTFOLIOS
THEREUNDER, ARE IDENTICAL, IN ALL MATERIAL RESPECTS, TO THOSE OF THE CURRENT
AGREEMENT, EXCEPT FOR THE DATES OF EFFECTIVENESS AND TERMINATION. The terms of
the Current Agreement are fully described under "The Current Investment
Management Agreement" below. If approved by Shareholders, the New Agreement will
continue in effect for an initial term expiring April 30, 1999. The New
Agreement will be continued in effect from year to year thereafter if each such
continuance with respect to a Portfolio is approved by the Board or by a
majority of the outstanding voting securities (as defined below) of such
Portfolio and, in either event, by the vote cast in person of a majority of the
Independent Trustees. In the event that Shareholders of one or more Portfolios
do not approve the New Agreement, the Current Agreement will remain in effect
with respect to the concerned Portfolio and the Board will take such action, if
any, as it deems to be in the best interests of the concerned Portfolio and its
Shareholders, which may include proposing that Shareholders approve an agreement
in lieu of the New Agreement. In the event that the Merger is not consummated,
the Investment Manager will continue to provide services to the Fund in
accordance with the terms of the Current Agreement for such periods as may be
approved at least annually by the Board, including a majority of the Independent
Trustees.
REQUIRED VOTE
The New Agreement cannot be implemented with respect to a particular
Portfolio unless approved at the Meeting, or any adjournment thereof, by a
majority of the outstanding voting securities of that Portfolio. Such a majority
means the affirmative vote of the holders of (a) 67% or more of the shares of
the Portfolio present, in person or by proxy, at the Meeting, if the holders of
more than 50% of the outstanding shares are so present, or (b) more than 50% of
the outstanding shares of the Portfolio, whichever is less.
THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS OF EACH PORTFOLIO VOTE
FOR APPROVAL OF THE NEW INVESTMENT MANAGEMENT AGREEMENT.
THE BOARD'S CONSIDERATION
At a special meeting of the Committee of the Independent Trustees of the
Fund held on February 20, 1997, at which each of the Independent Trustees of the
Fund was present, and a meeting of the full Board on February 21, 1997, the
Trustees evaluated the New Agreement (the form of which is attached hereto as
Appendix A). Prior to and during the meetings, the Independent Trustees
requested and received all information they deemed necessary to enable them to
determine whether the New Agreement is in the best interests of each Portfolio
of the Fund and
6
<PAGE>
its Shareholders. They were assisted in their review and deliberations by
independent legal counsel. In determining whether to approve the New Agreement,
the Trustees assessed the implications of the Merger for the Investment Manager
and its ability to continue to provide services to the Fund of the same scope
and quality as are presently provided. In particular, the Trustees inquired as
to the impact of the Merger on the Investment Manager's personnel, management,
facilities and financial capabilities, and received assurances in this regard
from senior management of DWDC and the Investment Manager that the Merger would
not adversely affect the Investment Manager's ability to fulfill its obligations
under its agreement with the Fund or to operate its business in a manner
consistent with past practices. In addition, the Trustees considered the effects
of the Investment Manager and Morgan Stanley becoming affiliated persons of each
other. Following the Merger, the 1940 Act will prohibit or impose certain
conditions on the ability of the Fund to engage in certain transactions with
Morgan Stanley and its affiliates. For example, absent exemptive relief, the
Fund will be prohibited from purchasing securities from Morgan Stanley & Co., a
wholly-owned broker-dealer subsidiary of Morgan Stanley, in transactions in
which Morgan Stanley & Co. acts as principal, and the Fund will have to satisfy
certain conditions in order to engage in securities transactions in which Morgan
Stanley & Co. acts as broker or to purchase securities in an underwritten
offering in which Morgan Stanley & Co. acts as an underwriter. In this
connection, senior management of the Investment Manager represented to the
Trustees that they do not believe these prohibitions or conditions will have a
material effect on the management or performance of the Portfolios of the Fund.
The Trustees also considered that the New Agreement is identical, in all
material respects, to the Current Agreement (other than the dates of
effectiveness and termination).
Based upon the Trustees' review and the evaluations of the materials they
received, and after consideration of all factors deemed relevant to them, the
Trustees of the Fund, including all of the Independent Trustees, determined that
the New Agreement is in the best interests of each Portfolio of the Fund and its
Shareholders. ACCORDINGLY, THE BOARD, INCLUDING ALL OF THE INDEPENDENT TRUSTEES,
APPROVED THE NEW AGREEMENT AND VOTED TO RECOMMEND APPROVAL BY SHAREHOLDERS OF
EACH PORTFOLIO OF THE FUND.
THE CURRENT INVESTMENT MANAGEMENT AGREEMENT
The Current Agreement provides that, subject to the supervision of the
Board, the Investment Manager shall obtain and evaluate such information and
advice relating to the economy and securities and commodities markets as it
deems necessary or useful to discharge its duties under the Current Agreement,
and that, with respect to each of the Portfolios other than those in respect of
which the Sub-Advisory Agreements (described in Proposal 2 below) are in effect,
it shall continuously manage of the assets of such Portfolios of the Fund in a
manner consistent with the investment objectives and policies of the respective
Portfolios. With respect to those Portfolios in respect of which the
Sub-Advisory Agreements are in effect (specifically, the North American
Government Securities Portfolio, the Balanced Portfolio, the Core Equity
Portfolio and the Emerging Markets Portfolio), the Current Agreement provides
that the Investment Manager shall supervise the management of the assets of such
Portfolios in a manner consistent with the investment objectives and policies of
the respective Portfolios, and subject to such other limitations and directions
as the Board may, from time to time, prescribe.
The Current Agreement further provides that the Investment Manager may, at
its own expense, enter into Sub-Advisory Agreements for the Portfolios. The
Investment Manager has entered into Sub-Advisory Agreements with TCW Funds
Management, Inc. in respect of the North American Government Securities
Portfolio, the Balanced Portfolio, the Core Equity Portfolio and the Emerging
Markets Portfolio, which Agreements are described in Proposal 2 below.
The Investment Manager pays the compensation of the officers of the Fund and
provides the Fund with office space and equipment, and clerical and bookkeeping
services and telephone service, heat, light, power and other
7
<PAGE>
utilities. The Investment Manager also pays for the services of personnel in
connection with the pricing of the Fund's shares and the preparation of
prospectuses, statements of additional information, proxy statements and reports
required to be filed with federal and state securities commissions (except
insofar as the participation or assistance of independent accountants and
attorneys is, in the opinion of the Investment Manager, necessary or desirable).
In return for its services and the expenses the Investment Manager assumes under
the Current Agreement, the Fund pays the Investment Manager compensation which
is accrued daily and payable monthly and which is set forth in the table below.
<TABLE>
<CAPTION>
MANAGEMENT FEE
PAID DURING FISCAL
YEAR ENDED NET ASSETS
NAME OF PORTFOLIO MANAGEMENT FEE RATE 12/31/96(1) AS OF 12/31/96
- --------------------------------------- --------------------------------------- --------------------- --------------
<S> <C> <C> <C>
Money Market Portfolio................. 0.50% of daily net assets $ 288,326 $ 87,001,689
North American Government Securities
Portfolio............................ 0.65% of daily net assets (of which 40%
is paid to a Sub-Adviser) 0 4,171,708
Diversified Income Portfolio........... 0.40% of daily net assets 36,906 32,119,198
Balanced Portfolio..................... 0.75% of daily net assets (of which 40%
is paid to a Sub-Adviser) 54,817 38,893,028
Utilities Portfolio.................... 0.65% of daily net assets 100,392 35,686,083
Dividend Growth Portfolio.............. 0.625% of daily net assets 1,015,687 258,100,867
Value-Added Market Portfolio........... 0.50% of daily net assets 196,512 73,516,480
Core Equity Portfolio.................. 0.85% of daily net assets (of which 40%
is paid to a Sub-Adviser) 6,411 18,214,811
American Value Portfolio............... 0.625% of daily net assets 473,945 120,903,831
Mid-Cap Growth Portfolio............... 0.75% of daily net assets --(2) 100,000
Global Equity Portfolio................ 1.0% of daily net assets 179,010 59,246,400
Developing Growth Portfolio............ 0.50% of daily net assets 155,982 61,119,998
Emerging Markets Portfolio............. 1.25% of daily net assets (of which 40%
is paid to a Sub-Adviser) 0 17,240,191
</TABLE>
- ------------------------------
(1) The Investment Manager had undertaken, until the earlier of December 31,
1996 or the attainment by the respective Portfolio of $50 million of net
assets, to assume all operating expenses of each Portfolio then in existence
(except for any brokerage fees and a portion of organizational expenses) and
waive the compensation provided for each such Portfolio in the Current
Agreement (other than the Dividend Growth Portfolio, whose net assets
exceeded $50 million on December 31, 1995) to the extent that such expenses
and compensation on an annualized basis exceeded 0.50% of the average daily
net assets of each respective Portfolio. Absent such waivers or assumption
of expenses by the Investment Manager, each Portfolio would have paid
management fees as follows: Money Market Portfolio -- $300,043; North
American Government Securities Portfolio -- $18,765; Diversified Income
Portfolio -- $77,064; Balanced Portfolio -- $199,407; Utilities Portfolio --
$184,447; Value-Added Market Portfolio -- $236,115; Core Equity Portfolio --
$79,428; American Value Portfolio -- $490,484; Global Equity Portfolio --
$383,855; Developing Growth Portfolio -- $197,326; and Emerging Markets
Portfolio -- $142,475. The American Value Portfolio, the Money Market
Portfolio, the Value-Added Market Portfolio, the Developing Growth Portfolio
and the Global Equity Portfolio attained $50 million of net assets on
February 26, 1996, March 20, 1996, August 13, 1996, September 14, 1996, and
October 15, 1996, respectively.
(2) The Mid-Cap Growth Portfolio commenced operations on January 21, 1997. The
Investment Manager has undertaken to assume all expenses (except for any
brokerage fees) of this Portfolio and to waive the compensation provided for
this Portfolio in the Current Agreement, until the earlier of July 21, 1997
or the attainment by the Portfolio of $50 million of net assets.
8
<PAGE>
Under the Current Agreement, the Fund is obligated to bear all of the costs
and expenses of its operation, except those specifically assumed by the
Investment Manager or, with respect to the North American Government Securities
Portfolio, the Balanced Portfolio, the Core Equity Portfolio and the Emerging
Markets Portfolio, the Sub-Adviser. Each Portfolio pays all such expenses
incurred in its operation and a portion of the Fund's general administration
expenses allocated on the basis of the asset size of the respective Portfolios.
Expenses that are borne directly by a Portfolio include, but are not limited to,
charges and expenses of any registrar, custodian or depository appointed by the
Fund for the safekeeping of the Portfolio's cash, portfolio securities and other
property, and any share transfer or dividend agent or agents appointed by the
Fund; brokers' commissions chargeable to the Fund in connection with portfolio
securities transactions to which the Portfolio is a party; all expenses incident
to the payment of any dividend, distribution, withdrawal or redemption, whether
in shares or in cash; charges and expenses of any outside pricing services;
interest payable on Portfolio borrowings; certain taxes; and all costs and
expenses in connection with registration and maintenance of registrations of the
Fund and of its shares with the Securities and Exchange Commission and various
states and other jurisdictions (including filing fees and legal fees and
disbursements of counsel). Expenses which are allocated on the basis of size of
the respective Portfolios include, but are not limited to, the costs and expense
of printing, including typesetting, and distributing prospectuses and statements
of additional information of the Fund and supplements thereto to its
Shareholders; all expenses of the Shareholders' and Trustees' meetings and of
preparing, printing and mailing proxy statements and reports to Shareholders;
fees and travel expenses of Trustees or members of any advisory board or
committee who are not employees of the Investment Manager or any corporate
affiliate of the Investment Manager; charges and expenses of legal counsel and
independent accountants in connection with any matter relating to the Fund (not
including compensation or expenses of attorneys employed by the Investment
Manager); state franchise taxes; membership dues of industry associations;
postage; insurance premiums on property or personnel (including officers and
Trustees) of the Fund which inure to its benefit; and all other charges and
costs of the Fund's operations properly payable by the Fund and allocable on the
basis of the size of the respective Portfolios. Depending on the nature of a
legal claim, liability or lawsuit, litigation costs, payment of legal claims or
liabilities and any indemnification relating thereto may be directly applicable
to the Portfolio or allocated on the basis of the size of the respective
Portfolios. The Trustees have determined that this is an appropriate method of
allocation of expenses.
The administrative services called for under the Current Agreement are
performed by Dean Witter Services Company Inc. ("DWSC"), a wholly-owned
subsidiary of InterCapital.
The Current Agreement was initially approved by the Board of Trustees on
August 25, 1994 and by Hartford Life Insurance Company as the then sole
shareholder on August 31, 1994. The Current Agreement was approved with respect
to the Mid-Cap Growth Portfolio by the Board of Trustees on October 25, 1996.
After its initial term, the Current Agreement continues in effect from year
to year thereafter with respect to each Portfolio, provided that each such
continuance with respect to a Portfolio is approved by the vote of a majority,
as defined by the 1940 Act, of the outstanding voting securities of such
Portfolio or by the Trustees, and, in either event, by the vote cast in person
by a majority of the Independent Trustees at a meeting called for the purpose of
voting on such approval. The Current Agreement has been continued in effect from
year to year by action of the Board, including the Independent Trustees. Prior
to the Board's February 21, 1997 meeting, such approval occurred at a meeting of
the Board held on April 17, 1996.
The Current Agreement also provides that it may be terminated at any time by
the Investment Manager, the Trustees or, with respect to a Portfolio, by a vote
of a majority of the outstanding voting securities of such Portfolio, in each
instance without the payment of any penalty, on thirty days' notice, and
provides for its automatic termination in the event of its assignment.
9
<PAGE>
THE INVESTMENT MANAGER
Dean Witter InterCapital Inc. is the Fund's investment manager. InterCapital
maintains its offices at Two World Trade Center, New York, New York 10048.
InterCapital, which was incorporated in July 1992, is a wholly-owned subsidiary
of DWDC, a balanced financial services organization providing a broad range of
nationally marketed credit and investment products.
The Principal Executive Officer and Directors of InterCapital, and their
principal occupations, are:
Philip J. Purcell, Chairman of the Board of Directors and Chief Executive
Officer of DWDC and Dean Witter Reynolds Inc. ("DWR") and Director of
InterCapital, DWSC and Dean Witter Distributors Inc. ("Distributors"); Richard
M. DeMartini, President and Chief Operating Officer of Dean Witter Capital,
Executive Vice President of DWDC and Director of DWR, Distributors,
InterCapital, DWSC and Dean Witter Trust Company ("DWTC"); James F. Higgins,
President and Chief Operating Officer of Dean Witter Financial, Executive Vice
President of DWDC and Director of DWR, Distributors, InterCapital, DWSC and
DWTC; Charles A. Fiumefreddo, Executive Vice President and Director of DWR and
Chairman of the Board of Directors, Chief Executive Officer and Director of
InterCapital, DWSC and Distributors and Chairman of the Board of Directors and
Director of DWTC; Christine A. Edwards, Executive Vice President, Secretary and
General Counsel of DWDC, Executive Vice President, Secretary, General Counsel
and Director of DWR, Executive Vice President, Secretary, Chief Legal Officer
and Director of Distributors, and Director of InterCapital and DWSC; and Thomas
C. Schneider, Executive Vice President and Chief Financial Officer of DWDC and
Executive Vice President, Chief Financial Officer and Director of DWR,
Distributors, InterCapital and DWSC.
The business address of the foregoing Directors and Executive Officer is Two
World Trade Center, New York, New York 10048. DWDC has its offices at Two World
Trade Center, New York, New York 10048.
InterCapital and its wholly-owned subsidiary, DWSC, serve in various
investment management, advisory, management and administrative capacities to
investment companies and pension plans and other institutional and individual
investors. Appendix B lists the investment companies for which InterCapital
provides investment management or investment advisory services and which have
similar investment objectives to those of the Portfolios of the Fund and sets
forth the fees payable to InterCapital by such companies, including the
Portfolios of the Fund, and their net assets as of March 12, 1997. DWSC also has
its offices at Two World Trade Center, New York, New York 10048.
For the fiscal year ended December 31, 1996, each Portfolio other than the
Mid-Cap Growth Portfolio (which Portfolio commenced operations on January 21,
1997) accrued to DWTC, the Fund's Transfer Agent and an affiliate of the
Investment Manager, transfer agency fees of $917. Once the Merger is consummated
and the New Agreement is approved, DWTC fully intends to continue to provide the
same services to the Fund as are currently being provided.
10
<PAGE>
The following table sets forth information as to the allocation of brokerage
commissions by the Portfolios in operation during the fiscal year ended December
31, 1996, paid to DWR, which is an affiliated broker of the Fund because DWR and
InterCapital are under the common control of DWDC:
<TABLE>
<CAPTION>
PERCENTAGE OF
AGGREGATE
BROKERAGE COMMISSIONS BROKERAGE COMMISSIONS
PAID TO DWR FOR FISCAL FOR FISCAL YEAR ENDED
NAME OF PORTFOLIO YEAR ENDED 12/31/96 12/31/96
- ------------------------------------------------------------------------ ---------------------- ----------------------
<S> <C> <C>
Money Market Portfolio.................................................. -- --
North American Government Securities Portfolio.......................... -- --
Diversified Income Portfolio............................................ -- --
Balanced Portfolio...................................................... $ 5,464 20.83%
Utilities Portfolio..................................................... 25,530 89.92
Dividend Growth Portfolio............................................... 173,213 60.14
Value-Added Market Portfolio............................................ -- --
Core Equity Portfolio................................................... 4,616 23.11
American Value Portfolio................................................ 108,676 34.62
Global Equity Portfolio................................................. 28,026 11.50
Developing Growth Portfolio............................................. 28,536 31.31
Emerging Markets Portfolio.............................................. -- --
</TABLE>
(2) APPROVAL OR DISAPPROVAL OF NEW SUB-ADVISORY AGREEMENTS
BETWEEN THE INVESTMENT MANAGER AND TCW FUNDS MANAGEMENT, INC
(WITH RESPECT TO THE NORTH AMERICAN GOVERNMENT SECURITIES PORTFOLIO, THE
BALANCED PORTFOLIO,
THE CORE EQUITY PORTFOLIO AND THE EMERGING MARKETS PORTFOLIO ONLY)
AND RELATED NEW SECONDARY SUB-ADVISORY AGREEMENTS BETWEEN TCW AND
EACH OF TCW ASIA LIMITED AND TCW LONDON INTERNATIONAL, LIMITED
(WITH RESPECT TO THE EMERGING MARKETS PORTFOLIO ONLY)
The Investment Manager has entered into a sub-advisory agreement (each, a
"Current Sub-Advisory Agreement" and collectively, "Current Sub-Advisory
Agreements") with TCW Funds Management, Inc. ("TCW" or the "Sub-Adviser")
respecting each of the North American Government Securities Portfolio, the
Balanced Portfolio, the Core Equity Portfolio and the Emerging Markets Portfolio
(each may be referred to as a "Sub-Advised Portfolio" and collectively as the
"Sub-Advised Portfolios"), pursuant to which TCW provides each Sub-Advised
Portfolio with investment advice and portfolio management, subject to the
overall supervision of the Investment Manager and the Trustees. TCW, in turn,
has entered into secondary sub-advisory agreements (each, a "Current Secondary
Agreement," together, the "Current Secondary Agreements," and collectively with
the Current Sub-Advisory Agreements, the "Current Sub-Agreements") with two of
its affiliates, TCW Asia Limited ("TCW Asia") and TCW London International,
Limited ("TCW London") (together, the "Secondary Sub-Advisers"), pursuant to
which the Secondary Sub-Advisers assist TCW in providing advisory services under
the Current Sub-Advisory Agreement for the Emerging Markets Portfolio.
At its meeting on February 21, 1997, the Board, including a majority of the
Independent Trustees, unanimously approved a new sub-advisory agreement
respecting each of the Sub-Advised Portfolios (each, a "New Sub-Advisory
Agreement" and collectively, the "New Sub-Advisory Agreements") and related new
secondary sub-advisory agreements respecting the Emerging Markets Portfolio
(each, a "New Secondary Agreement," together, the "New Secondary Agreements,"
and collectively with the "New Sub-Advisory Agreements," the "New Sub-
11
<PAGE>
Agreements"), and recommended that such agreements be submitted to Shareholders
for their approval or disapproval, to take effect upon the later of Shareholder
approval of the new agreements or consummation of the Merger, for an initial
term expiring April 30, 1999. The New Sub-Agreements may be continued from year
to year thereafter if each such continuance is approved by the Board or by a
majority of the outstanding voting securities of the concerned Portfolio (as
defined below under "Required Vote") and, in either event, by a vote cast in
person of a majority of the Independent Trustees. EACH NEW SUB-AGREEMENT IS
IDENTICAL, IN ALL MATERIAL RESPECTS, TO THE CORRESPONDING CURRENT SUB-AGREEMENT,
EXCEPT FOR THE DATES OF EFFECTIVENESS AND TERMINATION. The terms of the Current
Sub-Agreements are fully described under "The Current Sub-Agreements" below.
Forms of a New Sub-Advisory Agreement and the New Secondary Agreements are
attached hereto as Appendices C, D and E.
The New Sub-Agreements cannot be implemented as to a Sub-Advised Portfolio
unless approved at the Meeting by a majority of the outstanding voting
securities of the applicable Sub-Advised Portfolio (as defined below). In the
event that Shareholders of a Sub-Advised Portfolio do not approve the New
Sub-Agreement applicable to that Sub-Advised Portfolio, the Current
Sub-Agreement will remain in effect and the Board will take such action as it
deems to be in the best interests of the concerned Sub-Advised Portfolio and its
respective Shareholders, which may include proposing that Shareholders approve
an agreement in lieu of the New Sub-Agreement. In the event the Merger is not
consummated, the Sub-Adviser and the Secondary Sub-Advisers will continue to
provide services to the relevant Sub-Advised Portfolios in accordance with the
terms of the respective Current Sub-Agreements for such periods as may be
approved at least annually by the Board, including a majority of the Independent
Trustees. The New Sub-Agreements will not be implemented unless Proposal 1 is
also approved by the applicable Shareholders.
In considering whether to approve the New Sub-Agreements, the Board
considered all materials and information deemed relevant to such determination.
Among other things, the Board considered the nature and scope of services to be
rendered under the agreements, the quality of the services and personnel of the
Sub-Adviser and each of the Secondary Sub-Advisers and the appropriateness of
the fees that are paid under each New Sub-Agreement. The Board, in particular,
noted that THE TERMS OF EACH NEW SUB-AGREEMENT INCLUDING FEES PAYABLE THEREUNDER
ARE IDENTICAL, IN ALL MATERIAL RESPECTS, TO THOSE OF THE CORRESPONDING CURRENT
SUB-AGREEMENT, EXCEPT FOR THE DATES OF EFFECTIVENESS AND EXPIRATION. Based upon
its review, the Board, including all of the Independent Trustees, determined
that the approval of the New Sub-Agreements was in the best interests of the
applicable Sub-Advised Portfolios and their respective Shareholders.
THE CURRENT SUB-AGREEMENTS
Each Current Sub-Advisory Agreement requires that, subject to the
supervision of the Investment Manager and the Trustees, the Sub-Adviser provide
the Sub-Advised Portfolios with investment advisory services including, among
other things: (i) obtaining and evaluating such information and advice relating
to the economy, securities markets and securities as the Sub-Adviser deems
necessary to discharge its duties under the respective Current Sub-Advisory
Agreement; (ii) making determinations as to which securities each Sub-Advised
Portfolio should purchase or sell or otherwise dispose of (including the timing
of those decisions); and (iii) placing purchase and sale orders on behalf of the
Sub-Advised Portfolios, as the Sub-Adviser deems necessary or appropriate.
Each Current Secondary Agreement requires that, subject to the supervision
of TCW, the Secondary Sub-Advisers provide investment advisory services for the
Emerging Markets Portfolio. Such investment advisory services include, among
other things: (i) obtaining and evaluating such information and advice relating
to the economy, securities markets and securities as the Secondary Sub-Advisers
deem necessary to discharge their respective duties under the Current Secondary
Agreements; making determinations as to which securities the Emerging Markets
Portfolio should purchase or sell or otherwise dispose of (including the timing
of those
12
<PAGE>
decisions); and (iii) placing purchase and sale orders on behalf of the Emerging
Markets Portfolio as the Secondary Sub-Advisers deem necessary or appropriate.
The Current Sub-Agreements provide that the Sub-Adviser, in the case of the
Current Sub-Advisory Agreements, and each of the Secondary Sub-Advisers, in the
case of the Current Secondary Agreements, shall, at their own expense, maintain
such staff and employ or retain such personnel and consult with such other
persons as they shall, from time to time, determine to be necessary or useful to
the performance of their respective obligations under the Current
Sub-Agreements. They also bear other costs of rendering the investment advisory
services performed by them pursuant to the respective Current Sub-Agreements,
including such clerical help and bookkeeping services as they may require.
In return for the services it renders under the Current Sub-Advisory
Agreements, the Sub-Adviser is paid by the Investment Manager monthly
compensation equal to 40% of the Investment Manager's compensation receivable
pursuant to the Current Agreement respecting each of the Sub-Advised Portfolios.
(See Proposal 1 for more information regarding the fees payable under the
Current Agreement.) Any subsequent change in the Current Agreement which has the
effect of raising or lowering the compensation of the Investment Manager will
have the concomitant effect of raising or lowering the fee payable to the
Sub-Adviser. During the Fund's last fiscal year, the Investment Manager accrued
to the Sub-Adviser compensation under the Current Sub-Advisory Agreements of
$36,544 and $4,274 with respect to the Balanced Portfolio and the Core Equity
Portfolio, respectively. During that year, the Investment Manager accrued no
compensation to the Sub-Adviser under the Current Sub-Advisory Agreements with
respect to the North American Government Securities Portfolio and the Emerging
Markets Portfolio.
In return for the services they render under each of the Current Secondary
Agreements, TCW pays each Secondary Sub-Adviser the full compensation it
receives under the Current Sub-Advisory Agreement respecting the Emerging
Markets Portfolio. Such compensation is allocated to each Secondary Sub-Adviser
based on the percent of net assets of the Emerging Markets Portfolio for which
the Secondary Sub-Adviser advises. During the Fund's last fiscal year, TCW
accrued no compensation to TCW Asia and TCW London under the Current Secondary
Agreements.
The Current Sub-Agreements were initially approved by the Board (including a
majority of the Independent Trustees) on August 25, 1994, and by Hartford Life
Insurance Company as the then sole shareholder on August 31, 1994.
Each of the Current Sub-Agreements provides that, after its initial period
of effectiveness, it may be continued in effect from year to year, provided that
such continuance is approved by the vote of a majority of the outstanding voting
securities (as defined below) of the applicable Portfolio or by the Trustees,
and, in either event, by the vote cast in person by a majority of the
Independent Trustees at a meeting called for the purpose of voting on such
approval. Prior to the Board's February 21, 1997 meeting, such approval occurred
at a meeting of the Board held on April 17, 1996.
The Current Sub-Advisory Agreements also provide that they may be terminated
at any time by the Sub-Adviser, the Investment Manager, the Board (including a
majority of the Independent Trustees) or by a vote of the majority of the
outstanding voting securities of each Sub-Advised Portfolio (as defined below),
in each instance without the payment of any penalty, on thirty days' notice. The
Current Secondary Agreements also provide that they may be terminated at any
time by the relevant Secondary Sub-Adviser, the Sub-Adviser, the Board
(including a majority of the Independent Trustees) or by a vote of the majority
of the outstanding voting securities (as defined below) of the Emerging Markets
Portfolio, in each instance without the payment of penalty, on thirty days'
notice.
13
<PAGE>
Each of the Current Sub-Agreements also terminates in the event of the
termination of the Current Agreement (as discussed above) or in the event of its
assignment.
REQUIRED VOTE
The New Sub-Agreements cannot be implemented as to a Sub-Advised Portfolio
unless approved at the Meeting by a majority of the outstanding voting
securities of the applicable Sub-Advised Portfolio. Such a majority means the
affirmative vote of the holders of (a) 67% or more of the shares of the
applicable Sub-Advised Portfolio present in person or by proxy at the Meeting,
if the holders of more than 50% of the outstanding shares are so present, or (b)
more than 50% of the outstanding shares of the applicable Sub-Advised Portfolio,
whichever is less.
THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS OF EACH SUB-ADVISED
PORTFOLIO VOTE FOR APPROVAL OF THE NEW SUB-AGREEMENTS APPLICABLE TO THAT
PORTFOLIO.
TCW AND THE SECONDARY SUB-ADVISERS
TCW, a California corporation, and the Secondary Sub-Advisers are a
wholly-owned subsidiary of The TCW Group, Inc. (formerly TCW Management Company)
("The TCW Group"), a Nevada corporation, whose direct and indirect subsidiaries,
including Trust Company of the West and TCW Asset Management Company, provide a
variety of trust, investment management and investment advisory services. As of
February 28, 1997, TCW and its affiliates had approximately $53 billion under
management or committed to management. TCW is headquartered at 865 South
Figueroa Street, Suite 1800, Los Angeles, California 90017. The address of TCW
Asia is One Pacific Place, 88 Queensway, Hong Kong. The address of TCW London is
Birkett House, 27 Albemarle Street, London, United Kingdom W1X 4LP.
The Principal Executive Officer and Directors of TCW, and their principal
occupations, are:
Thomas E. Larkin, Jr., Chairman, Marc I. Stern, President and Alvin R. Albe,
Jr., Executive Vice President. Mr. Robert A. Day may be deemed to be a control
person of TCW by virtue of the aggregate ownership of Mr. Day and his family of
more than 25% of the outstanding voting stock of The TCW Group, Inc. Mr. Albe is
an Executive Vice President of The TCW Group.
The business address of the foregoing Directors and Executive Officer is 865
South Figueroa Street, Suite 1800, Los Angeles, California 90017.
The Principal Executive Officer and Directors of TCW Asia, and their
principal occupations, are: Marc I. Stern, Chairman; Terence F. Mahony, Vice
Chairman; Shaun C.K. Chan, President; Alvin R. Albe, Jr.; and Michael E. Cahill.
Mr. Stern is President of The TCW Group; Mr. Albe is an Executive Vice President
of The TCW Group; and Mr. Cahill is General Counsel of The TCW Group.
The business address of the foregoing individuals is One Pacific Place, 88
Queensway, Hong Kong (Messrs. Chan and Mahony) and 865 South Figueroa Street,
Suite 1800, Los Angeles, California 90017 (Messrs. Albe, Cahill and Stern).
The Principal Executive Officer and Directors of TCW London, and their
principal occupations, are: Marc I. Stern, Chairman; Javier Baz, President;
Alvin R. Albe, Jr., Michael E. Cahill; Damon P. de Laszlo; and Ernest E.
Ellison. Mr. Stern is President of The TCW Group; Mr. Albe is an Executive Vice
President of The TCW Group; Mr. Cahill is General Counsel of The TCW Group; Mr.
Ellison is Vice Chairman of The TCW Group; Mr. Baz is a Managing Director of
Trust Company of the West and TCW Asset Management Company; and Mr. de Laszlo is
Chairman of Harwin PLC (London).
14
<PAGE>
The business address of the foregoing individuals is Birkett House, 27
Albemarle Street, London, United Kingdom W1X 4LP (Mr. de Laszlo) and 865 South
Figueroa Street, Suite 1800, Los Angeles, California 90017
(Messrs. Albe, Baz, Cahill, Ellison and Stern).
Appendix F to this Proxy Statement lists the investment companies for which
TCW, TCW Asia and TCW London provide investment advisory or sub-advisory
services and which have similar investment objectives to those of one or more of
the Portfolios, and sets forth the fees payable to TCW, TCW Asia and/or TCW
London by such investment companies, including the Portfolios, and their net
assets as of March 12, 1997.
(3) ELECTION OF TRUSTEES
The number of Trustees has been fixed by the Board at nine. There are
presently eight Trustees, all of whom are standing for re-election at the
Meeting for indefinite terms. In addition, the Board has nominated Wayne E.
Hedien for election as Trustee at the Meeting for the first time.
Six of the current eight Trustees (Michael Bozic, Edwin J. Garn, John R.
Haire, Manuel H. Johnson, Michael E. Nugent and John L. Schroeder) are
Independent Trustees. Mr. Hedien, who has been nominated for election at the
Meeting, if elected, also will be an Independent Trustee. The other two current
Trustees, Charles A. Fiumefreddo and Philip J. Purcell, are "interested persons"
(as such term is defined in the 1940 Act) of the Fund and InterCapital and,
thus, are not Independent Trustees. The nominees for election as Trustees have
been proposed by the Trustees now serving or, in the case of the nominees for
positions as Independent Trustees, by the Independent Trustees now serving. All
of the members of the Board currently serving were previously elected by
Hartford Life Insurance Company as the then sole shareholder on August 31, 1994.
The following information regarding each of the nominees for election as
Trustee includes principal occupations and employment for at least the last five
years, age, positions with the Funds, and directorships (or trusteeships) in
other companies which file periodic reports with the Securities and Exchange
Commission, including the 84 investment companies, including the Fund, for which
InterCapital serves as investment manager or investment adviser (referred to
herein as the "Dean Witter Funds") and the 14 investment companies for which
InterCapital's wholly-owned subsidiary, DWSC, serves as manager and TCW Funds
Management, Inc. serves as investment adviser (referred to herein as the "TCW/DW
Funds"). As of the record date for the Meeting, no Trustee was a Contract Owner
under the Accounts.
The nominees for Trustee to be elected at the Meeting are:
MICHAEL BOZIC, Trustee since April 1994*; age 56; Chairman and Chief
Executive Officer of Levitz Furniture Corporation (since November 1995);
Director or Trustee of the Dean Witter Funds; formerly President and Chief
Executive Officer of Hills Department Stores (May 1991-July 1995); formerly
variously Chairman, Chief Executive Officer, President and Chief Operating
Officer (1987-1991) of the Sears Merchandise Group of Sears, Roebuck and Co.
("Sears"); Director of Eaglemark Financial Services, Inc., the United Negro
College Fund and Weirton Steel Corporation.
CHARLES A. FIUMEFREDDO, Trustee since July 1991*; age 63; Chairman, Chief
Executive Officer and Director of InterCapital, DWSC and Distributors; Executive
Vice President and Director of DWR; Chairman, Director or Trustee, President and
Chief Executive Officer of the Dean Witter Funds; Chairman, Chief Executive
Officer and Trustee of the TCW/DW Funds; Chairman and Director of DWTC; Director
and/or officer of various DWDC subsidiaries; formerly Executive Vice President
and Director of DWDC (until February 1993).
- ------------------------
*This date is the date the Trustee began serving the Dean Witter Funds complex.
15
<PAGE>
EDWIN JACOB (JAKE) GARN, Trustee since January 1993*; age 64; Director or
Trustee of the Dean Witter Funds; formerly United States Senator (R-Utah)
(1974-1992) and Chairman, Senate Banking Committee (1980-1986); formerly Mayor
of Salt Lake City, Utah (1971-1974); formerly Astronaut, Space Shuttle Discovery
(April 12-19, 1985); Vice Chairman, Huntsman Corporation (since January 1993);
Director of Franklin Quest (time management systems) and John Alden Financial
Corp. (health insurance); member of the board of various civic and charitable
organizations.
JOHN R. HAIRE, Trustee since January 1981*; age 72; Chairman of the Audit
Committee and Chairman of the Committee of the Independent Directors or Trustees
and Director or Trustee of the Dean Witter Funds; Chairman of the Audit
Committee and Chairman of the Committee of the Independent Trustees and Trustee
of the TCW/DW Funds; formerly President, Council for Aid to Education
(1978-1989) and Chairman and Chief Executive Officer of Anchor Corporation, an
investment adviser (1964-1978); Director of Washington National Corporation
(insurance).
WAYNE E. HEDIEN, age 63; Retired; Director of The PMI Group, Inc. (private
mortgage insurance); Trustee and Vice Chairman of The Field Museum of Natural
History; formerly associated with the Allstate Companies (1966-1994), most
recently as Chairman of The Allstate Corporation (March 1993-December 1994) and
Chairman and Chief Executive Officer of its wholly-owned subsidiary, Allstate
Insurance Company (July 1989-December 1994); director of various other business
and charitable organizations.
DR. MANUEL H. JOHNSON, Trustee since July 1991*; age 48; Senior Partner,
Johnson Smick International, Inc., a consulting firm; Co-Chairman and a founder
of the Group of Seven Council (G7C), an international economic commission;
Director or Trustee of the Dean Witter Funds; Trustee of the TCW/DW Funds;
Director of NASDAQ (since June 1995); Director of Greenwich Capital Markets Inc.
(broker-dealer); Trustee of the Financial Accounting Foundation (oversight
organization for the FASB); formerly Vice Chairman of the Board of Governors of
the Federal Reserve System (1986-1990) and Assistant Secretary of the U.S.
Treasury (1982-1986).
MICHAEL E. NUGENT, Trustee since July 1991*; age 60; General Partner,
Triumph Capital, L.P., a private investment partnership; Director or Trustee of
the Dean Witter Funds; Trustee of the TCW/DW Funds; formerly Vice President,
Bankers Trust Company and BT Capital Corporation (1984-1988); Director of
various business organizations.
PHILIP J. PURCELL, Trustee since April 1994*; age 53; Chairman of the Board
of Directors and Chief Executive Officer of DWDC, DWR and Novus Credit Services
Inc.; Director of InterCapital, DWSC and Distributors; Director or Trustee of
the Dean Witter Funds; Director and/or officer of various DWDC subsidiaries.
JOHN L. SCHROEDER, Trustee since April 1994*; age 66; Retired; Director or
Trustee of the Dean Witter Funds; Trustee of the TCW/DW Funds; Director of
Citizens Utilities Company; formerly Executive Vice President and Chief
Investment Officer of the Home Insurance Company (1991-1995).
The other executive officers of the Fund are: Barry Fink, Vice President,
Secretary and General Counsel; Robert M. Scanlan, Vice President; Robert S.
Giambrone, Vice President; Joseph J. McAlinden, Vice President; Peter M. Avelar,
Vice President; Kirk Balzer, Vice President; Mark Bavoso, Vice President;
Patricia A. Cuddy, Vice President; Edward F. Gaylor, Vice President; Rajesh K.
Gupta, Vice President; Kenton J. Hinchliffe, Vice President; Anita H. Kolleeny,
Vice President; Paula La Costa, Vice President; Jonathan R. Page, Vice
President; Vinh Q. Tran, Vice President; Paul D. Vance, Vice President; Jayne
Stevlingson, Vice President; Ronald J.
- ------------------------
*This date is the date the Trustee began serving the Dean Witter Funds complex.
16
<PAGE>
Worobel, Vice President; Philip A. Barach, Vice President; James M. Goldberg,
Vice President; Jeffrey E. Gundlach, Vice President; Robert M. Hanisee, Vice
President; Frederick H. Horton, Vice President; Terence F. Mahony, Vice
President; Michael P. Reilly, Vice President; James A. Tilton, Vice President;
and Thomas F. Caloia, Treasurer. In addition, Kevin Hurley is a Vice President
of the Fund and Frank Bruttomesso, Marilyn K. Cranney, Lou Anne D. McInnis,
Carsten Otto and Ruth Rossi serve as Assistant Secretaries of each Fund.
Mr. Fink is 42 years old and is currently First Vice President (since June
1993), Secretary and General Counsel (since February 1997) of InterCapital and
DWSC and (since August 1996) Assistant Secretary of DWR; he is also First Vice
President, Assistant Secretary and Assistant General Counsel of Distributors
(since February 1997). He was previously Vice President, Assistant Secretary and
Assistant General Counsel of InterCapital and DWSC. Mr. Scanlan is 60 years old
and is currently President and Chief Operating Officer of InterCapital (since
March 1993) and DWSC; he is also Executive Vice President of Distributors and
Executive Vice President and Director of DWTC. He was previously Executive Vice
President of InterCapital (July 1992-March 1993) and prior thereto was Chairman
of Harborview Group, Inc. Mr. Giambrone is 42 years old and is currently Senior
Vice President of InterCapital, DWSC, Distributors and DWTC (since August 1995)
and Director of DWTC (since April 1996). He was formerly a partner of KPMG Peat
Marwick, LLP. Mr. McAlinden is 54 years old and is currently Executive Vice
President of InterCapital (since April 1996); he is also Chief Investment
Officer of InterCapital and Director of DWTC (since April 1996). He was
previously Senior Vice President of InterCapital (June 1995-April 1996) and
prior thereto was a Managing Director of Dillon Reed. Mr. Avelar is 38 years old
and is currently Senior Vice President of InterCapital. Mr. Balzer is 33 years
old and is currently Vice President of InterCapital (since April 1996). He was
previously a portfolio manager with Chancellor Capital Management (July
1994-March 1996) and GT Capital Management (June 1992-July 1994) and prior
thereto was a graduate student at the University of Chicago. Mr. Bavoso is 36
years old and is currently Senior Vice President of InterCapital (since June
1993). He was previously Vice President of InterCapital. Ms. Cuddy is 42 years
old and is currently Vice President of InterCapital (since June 1994). She was
previously Senior Vice President of Dreyfus Corporation. Mr. Gaylor is 55 years
old and is currently Senior Vice President of InterCapital. Mr. Hinchliffe is 52
years old and is currently Senior Vice President of InterCapital. Ms. Kolleeny
is 41 years old and is currently Senior Vice President of InterCapital. Ms. La
Costa is 45 years old and is currently Vice President of InterCapital. Mr. Page
is 50 years old and is currently Senior Vice President of InterCapital. Mr. Tran
is 50 years old and is currently Vice President of InterCapital. Mr. Vance is 61
years old and is currently Senior Vice President of InterCapital. Ms.
Stevlingson is 37 years old and is currently Vice President of InterCapital
(since October 1992). She was previously Assistant Vice President of Bankers
Trust New York Corp. Mr. Worobel is 54 years old and is currently Senior Vice
President of InterCapital. He was previously Vice President of InterCapital
(June 1992-June 1993) and prior thereto was Managing Director at MacKay-Shields
Financial Corp. (February 1989-June 1992). Mr. Barach is 44 years old and is
currently Group Managing Director of TCW and Managing Director, Mortgage-Backed
Securities of Trust Company of the West and TCW Asset Management Company. Mr.
Goldberg is 51 years old and is currently Managing Director of TCW and Managing
Director and Chairman of the Fixed Income Policy Committee of Trust Company of
the West and TCW Asset Management Company. Mr. Gundlach is 37 years old and is
currently Group Managing Director of TCW and Managing Director, Mortgage-Backed
Securities of Trust Company of the West and TCW Asset Management Company. Mr.
Haniseee is 58 years old and is currently Managing Director of TCW and Managing
Director, Co-Director of Research and Chairman of the Equity Policy Committee of
Trust Company of the West and TCW Asset Management Company. Mr. Horton is 38
years old and is currently Managing Director of TCW (since October 1993). He was
previously Senior Portfolio Manager for Dewey Square Investors (June
1991-September 1993). Mr. Mahony is 54 years old and is currently Managing
Director of TCW (since April 1996). He was previously Chief Investment Officer
for Global Emerging Markets at HSBC Asset Management (September 1993-April 1996)
and prior thereto a Director of Baring Asset
17
<PAGE>
Management. Mr. Reilly is 33 years old and is currently Managing Director of
TCW. He has been associated with TCW since June 1992 and was previously Vice
President of Security Pacific Bank. Mr. Tilton is 56 years old and is currently
Managing Director of TCW and Managing Director and member of the Equity Policy
Committee of Trust Company of the West and TCW Asset Management Company. Mr.
Caloia is 51 years old and is currently First Vice President and Assistant
Treasurer of InterCapital and DWSC. Mr. Hurley is 52 years old and is currently
Senior Vice President of InterCapital (since February 1995). He was previously a
private investor (January 1994-February 1995) and prior thereto was Managing
Director of Ark Asset Management Co., Inc. for five years. Other than Messrs.
Scanlan, Giambrone, McAlinden, Hermann, Knox, Worobel, Hurley, Horton, Mahony
and Reilly and Mses. Cuddy and Stevlingson, each of the above officers has been
an employee of InterCapital or DWR (formerly the corporate parent of
InterCapital) or TCW or its affiliates for over five years.
THE BOARD OF TRUSTEES, THE INDEPENDENT TRUSTEES, AND THE COMMITTEES
The Board of Trustees currently consists of eight (8) Trustees. These same
individuals also serve as directors or trustees for all of the Dean Witter
Funds, and are referred to in this section as Trustees. As of the date of this
Proxy Statement, there are a total of 84 Dean Witter Funds, comprised of 127
portfolios. As of February 28, 1997, the Dean Witter Funds had total net assets
of approximately $84.2 billion and more than six million shareholders.
Six Trustees and the new nominee (77% of the total number) have no
affiliation or business connection with InterCapital or any of its affiliated
persons. The other two Trustees (the "Management Trustees") are affiliated with
InterCapital. For a period of at least three years after consummation of the
Merger, at least 75% of the members of the Board of Trustees of the Fund will
not be "interested persons" (as defined in the 1940 Act) of the Investment
Manager. Four of the six Independent Trustees are also Independent Trustees of
the TCW/DW Funds.
Law and regulation establish both general guidelines and specific duties for
the Independent Trustees. The Dean Witter Funds seek as Independent Trustees
individuals of distinction and experience in business and finance, government
service or academia; these are people whose advice and counsel are in demand by
others and for whom there is often competition. To accept a position on the
Funds' Boards, such individuals may reject other attractive assignments because
the Funds make substantial demands on their time. Indeed, by serving on the
Funds' Boards, certain Trustees who would otherwise be qualified and in demand
to serve on bank boards would be prohibited by law from doing so.
All of the current Independent Trustees serve as members of the Audit
Committee and the Committee of the Independent Trustees. Three of them also
serve as members of the Derivatives Committee. The Committees hold some meetings
at InterCapital's offices and some outside InterCapital. Management Trustees or
officers do not attend these meetings unless they are invited for purposes of
furnishing information or making a report. The Funds do not have any nominating
or compensation committees.
The Committee of the Independent Trustees is charged with recommending to
the full Board approval of management, advisory and administration contracts,
Rule 12b-1 plans and distribution and underwriting agreements; continually
reviewing Fund performance; checking on the pricing of portfolio securities,
brokerage commissions, transfer agent costs and performance, and trading among
Funds in the same complex; and approving fidelity bond and related insurance
coverage and allocations, as well as other matters that arise from time to time.
The Independent Trustees are required to select and nominate individuals to fill
any Independent Trustee vacancy on the Board of any Fund that has a Rule 12b-1
plan of distribution. Most of the Dean Witter Funds have such a plan.
The Audit Committee is charged with recommending to the full Board the
engagement or discharge of the Funds' independent accountants; directing
investigations into matters within the scope of the independent
18
<PAGE>
accountants' duties, including the power to retain outside specialists;
reviewing with the independent accountants the audit plan and results of the
auditing engagement; approving professional services provided by the independent
accountants and other accounting firms prior to the performance of such
services; reviewing the independence of the independent accountants; considering
the range of audit and non-audit fees; reviewing the adequacy of the Fund's
system of internal controls; and preparing and submitting Committee meeting
minutes to the full Board.
Finally, the Board of each Fund has formed a Derivatives Committee to
establish parameters for and oversee the activities of the Fund with respect to
derivative investments, if any, made by the Fund.
For the fiscal year ended December 31, 1996, the Board of Trustees of the
Fund held seven meetings, and the Audit Committee, the Committee of the
Independent Trustees and the Audit Committee held three, ten and three meetings,
respectively. No Trustee attended fewer than 75% of the meetings of the Board,
the Audit Committee, the Committee of the Independent Trustees or the
Derivatives Committee held while he served in such positions.
DUTIES OF CHAIRMAN OF COMMITTEE OF THE INDEPENDENT TRUSTEES AND AUDIT COMMITTEE
The Chairman of the Committee of the Independent Trustees and the Audit
Committee maintains an office at the Funds' headquarters in New York. He is
responsible for keeping abreast of regulatory and industry developments and the
Funds' operations and management. He screens and/or prepares written materials
and identifies critical issues for the Independent Trustees to consider,
develops agendas for Committee meetings, determines the type and amount of
information that the Committees will need to form a judgment on various issues,
and arranges to have that information furnished to Committee members. He also
arranges for the services of independent experts and consults with them in
advance of meetings to help refine reports and to focus on critical issues.
Members of the Committees believe that the person who serves as Chairman of both
Committees and guides their efforts is pivotal to the effective functioning of
the Committees.
The Chairman of the Committees also maintains continuous contact with the
Funds' management, with independent counsel to the Independent Trustees and with
the Funds' independent auditors. He arranges for a series of special meetings
involving the annual review of investment advisory, management and other
operating contracts of the Funds and, on behalf of the Committees, conducts
negotiations with the Investment Manager and other service providers. In effect,
the Chairman of the Committees serves as a combination of chief executive and
support staff of the Independent Trustees.
The Chairman of the Committee of the Independent Trustees and the Audit
Committee is not employed by any other organization and devotes his time
primarily to the services he performs as Committee Chairman and Independent
Trustee of the Dean Witter Funds and as an Independent Trustee and, since July
1, 1996, as Chairman of the Committee of the Independent Trustees and the Audit
Committee of the TCW/DW Funds. The current Committee Chairman has had more than
35 years experience as a senior executive in the investment company industry.
ADVANTAGES OF HAVING SAME INDIVIDUALS AS INDEPENDENT TRUSTEES FOR ALL DEAN
WITTER FUNDS
The Independent Trustees and the Funds' management believe that having the
same Independent Trustees for each of the Dean Witter Funds avoids the
duplication of effort that would arise from having different groups of
individuals serving as Independent Trustees for each of the Funds or even of
sub-groups of Funds. They believe that having the same individuals serve as
Independent Trustees of all the Funds tends to increase their knowledge and
expertise regarding matters which affect the Fund complex generally and enhances
their ability to negotiate on behalf of each Fund with the Fund's service
providers. This arrangement also precludes the possibility of
19
<PAGE>
separate groups of Independent Trustees arriving at conflicting decisions
regarding operations and management of the Funds and avoids the cost and
confusion that would likely ensue. Finally, having the same Independent Trustees
serve on all Fund Boards enhances the ability of each Fund to obtain, at modest
cost to each separate Fund, the services of Independent Trustees, and a Chairman
of their Committees, of the caliber, experience and business acumen of the
individuals who serve as Independent Trustees of the Dean Witter Funds.
SHARE OWNERSHIP BY TRUSTEES
The Trustees have adopted a policy pursuant to which each Trustee and/or his
or her spouse is required to invest at least $25,000 in any of the Funds in the
Dean Witter Funds complex (and, if applicable, in the TCW/DW Funds complex) on
whose boards the Trustee serves. In addition, the policy contemplates that the
Trustees will, over time, increase their aggregate investment in the Funds above
the $25,000 minimum requirement. The Trustees may allocate their investments
among specific Funds in any manner they determine is appropriate based on their
individual investment objectives. As of the date of this Proxy Statement, each
Trustee is in compliance with the policy. Any future Trustee will be given a one
year period following his or her election within which to comply with the
foregoing. As of December 31, 1996, the total value of the investments by the
Trustees and/or their spouses in shares of the Dean Witter Funds (and, if
applicable, the TCW/DW Funds) was approximately $9.8 million.
As of the Record Date, none of the Trustees of the Fund was a Contract Owner
under the Accounts, and the aggregate number of shares of each Portfolio of the
Fund allocated to Contracts owned by the Fund's officers as a group was less
than 1 percent of each Portfolio's outstanding shares.
COMPENSATION OF INDEPENDENT TRUSTEES
The Fund pays each Independent Trustee an annual fee of $1,000 plus a per
meeting fee of $50 for meetings of the Board of Trustees or committees of the
Board attended by the Trustee (the Fund pays the Chairman of the Audit Committee
an annual fee of $750 and pays the Chairman of the Committee of the Independent
Trustees an additional annual fee of $1,200). The Fund also reimburses such
Trustees for travel and other out-of-pocket expenses incurred by them in
connection with attending such meetings. Trustees and officers of the Fund who
are or have been employed by the Investment Manager or an affiliated company
receive no compensation or expense reimbursement from the Fund.
The following table illustrates the compensation paid to the Fund's
Independent Trustees by the Fund for the fiscal year ended December 31, 1996.
FUND COMPENSATION
<TABLE>
<CAPTION>
AGGREGATE
COMPENSATION
NAME OF INDEPENDENT TRUSTEE FROM THE FUND
- ------------------------------------------------------------------------------------- -------------
<S> <C>
Michael Bozic........................................................................ $ 1,800
Edwin J. Garn........................................................................ 1,850
John R. Haire........................................................................ 3,950
Dr. Manuel H. Johnson................................................................ 1,800
Michael E. Nugent.................................................................... 1,800
John L. Schroeder.................................................................... 1,800
</TABLE>
20
<PAGE>
The following table illustrates the compensation paid to the Fund's
Independent Trustees for the calendar year ended December 31, 1996 for services
to the 82 Dean Witter Funds and, in the case of Messrs. Haire, Johnson, Nugent
and Schroeder, the 14 TCW/DW Funds that were in operation at December 31, 1996.
With respect to Messrs. Haire, Johnson, Nugent and Schroeder, the TCW/DW Funds
are included solely because of a limited exchange privilege between those Funds
and five Dean Witter Money Market Funds.
CASH COMPENSATION FROM DEAN WITTER FUNDS AND TCW/DW FUNDS
<TABLE>
<CAPTION>
FOR SERVICE AS FOR SERVICE
CHAIRMAN OF AS TOTAL CASH
COMMITTEES OF CHAIRMAN OF COMPENSATION
FOR SERVICE INDEPENDENT COMMITTEES OF FOR SERVICES
AS DIRECTOR OR DIRECTORS/ INDEPENDENT TO
TRUSTEE AND FOR SERVICE AS TRUSTEES AND TRUSTEES AND 82 DEAN
COMMITTEE MEMBER TRUSTEE AND AUDIT AUDIT WITTER
OF 82 DEAN COMMITTEE MEMBER COMMITTEES OF COMMITTEES OF FUNDS AND
NAME OF WITTER OF 14 TCW/DW 82 DEAN WITTER 14 TCW/DW 14 TCW/DW
INDEPENDENT TRUSTEE FUNDS FUNDS FUNDS FUNDS FUNDS
- --------------------------- ---------------- ---------------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Michael Bozic.............. $138,850 -- -- -- $138,850
Edwin J. Garn.............. 140,900 -- -- -- 140,900
John R. Haire.............. 106,400 $64,283 $195,450 $ 12,187 378,320
Dr. Manuel H. Johnson...... 137,100 66,483 -- -- 203,583
Michael E. Nugent.......... 138,850 64,283 -- -- 203,133
John L. Schroeder.......... 137,150 69,083 -- -- 206,233
</TABLE>
As of the date of this Proxy Statement, 57 of the Dean Witter Funds, not
including the Fund, have adopted a retirement program under which an Independent
Trustee who retires after serving for at least five years (or such lesser period
as may be determined by the Board) as an Independent Director or Trustee of any
Dean Witter Fund that has adopted the retirement program (each such Fund
referred to as an "Adopting Fund" and each such Trustee referred to as an
"Eligible Trustee") is entitled to retirement payments upon reaching the
eligible retirement age (normally, after attaining age 72). Annual payments are
based upon length of service. Currently, upon retirement, each Eligible Trustee
is entitled to receive from the Fund, commencing as of his or her retirement
date and continuing for the remainder of his or her life, an annual retirement
benefit (the "Regular Benefit") equal to 25.0% of his or her Eligible
Compensation plus 0.4166666% of such Eligible Compensation for each full month
of service as an Independent Director or Trustee of any Adopting Fund in excess
of five years up to a maximum of 50.0% after ten years of service. The foregoing
percentages may be changed by the Board.(1) "Eligible Compensation" is one-fifth
of the total compensation earned by such Eligible Trustee for service to the
Fund in the five year period prior to the date of the Eligible Trustee's
retirement.
The following table illustrates the retirement benefits accrued to the
Fund's Independent Trustees by the 57 Dean Witter Funds (not including the Fund)
for the year ended December 31, 1996, and the estimated retirement benefits for
the Fund's Independent Trustees, to commence upon their retirement, from the 57
Dean Witter Funds as of December 31, 1996.
- ------------------------------
(1) An Eligible Trustee may elect alternative payments of his or her retirement
benefits based upon the combined life expectancy of such Eligible Trustee
and his or her spouse on the date of such Eligible Trustee's retirement. The
amount estimated to be payable under this method, through the remainder of
the later of the lives of such Eligible Trustee and spouse, will be the
actuarial equivalent of the Regular Benefit. In addition, the Eligible
Trustee may elect that the surviving spouse's periodic payment of benefits
will be equal to either 50% or 100% of the previous periodic amount, an
election that, respectively, increases or decreases the previous periodic
amount so that the resulting payments will be the actuarial equivalent to
the Regular Benefit.
21
<PAGE>
RETIREMENT BENEFITS FROM ALL DEAN WITTER FUNDS
<TABLE>
<CAPTION>
ESTIMATED
RETIREMENT ANNUAL
ESTIMATED BENEFITS BENEFITS
CREDITED YEARS ESTIMATED ACCRUED AS UPON
OF SERVICE AT PERCENTAGE OF EXPENSES RETIREMENT
RETIREMENT ELIGIBLE BY ALL FROM ALL
NAME OF INDEPENDENT TRUSTEE (MAXIMUM 10) COMPENSATION ADOPTING FUNDS ADOPTING FUNDS
- ------------------------------------------------------- ------------------- ---------------- -------------- --------------
<S> <C> <C> <C> <C>
Michael Bozic.......................................... 10 50.0% $ 20,147 $ 51,325
Edwin J. Garn.......................................... 10 50.0 27,772 51,325
John R. Haire.......................................... 10 50.0 46,952 129,550
Dr. Manuel H. Johnson.................................. 10 50.0 10,926 51,325
Michael E. Nugent...................................... 10 50.0 19,217 51,325
John L. Schroeder...................................... 8 41.7 38,700 42,771
</TABLE>
- ------------------------------
(2) Based on current levels of compensation. Amount of annual benefits also
varies depending on the Trustee's elections described in Footnote (1) above.
The persons named as attorneys-in-fact in the enclosed proxy have advised
the Fund that unless a proxy instructs them to withhold authority to vote for
all listed nominees or for any individual nominee, they will vote all validly
executed proxies for the election of the nominees named above. All of the
nominees have consented to being named in this Proxy Statement and to serve, if
elected, and no circumstances now known will prevent any of the nominees from
serving (if elected, Mr. Hedien's term will commence September 1, 1997). If any
nominee should be unable or unwilling to serve, the proxy will be voted for a
substitute nominee proposed by the present Trustees or, in the case of an
Independent Trustee nominee, by the Independent Trustees. The election of each
Trustee requires the approval of a majority of the shares of the Fund
represented and entitled to vote at the Meeting.
THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION OF
ALL OF THE TRUSTEES NOMINATED FOR ELECTION.
(4) RATIFICATION OR REJECTION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Trustees have unanimously selected the firm of Price Waterhouse LLP
("Price Waterhouse") as the Fund's independent accountants for the fiscal year
ending December 31, 1997. The selection of Price Waterhouse is being submitted
for ratification or rejection by Shareholders at the Meeting. Price Waterhouse
has been the independent accountants for the Fund since its inception, and has
no direct or indirect financial interest in the Fund.
A representative of Price Waterhouse is expected to be present at the
Meeting and will be available to make a statement, and to respond to appropriate
questions of Shareholders.
Ratification of the selection of Price Waterhouse requires the approval of a
majority of the shares of the Fund represented and entitled to vote at the
Meeting.
THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS RATIFY THE SELECTION OF
PRICE WATERHOUSE AS THE INDEPENDENT ACCOUNTANTS FOR THE FUND.
22
<PAGE>
ADDITIONAL INFORMATION
In the event that the necessary quorum to transact business or the vote
required to approve or reject any proposal is not obtained at the Meeting with
respect to the Fund or, if applicable, one or more Portfolios, the persons named
as proxies may propose one or more adjournments of the Meeting for a total of
not more than 60 days in the aggregate, to permit further solicitation of
proxies. Any such adjournment will require the affirmative vote of the holders
of a majority of the Fund's or, if applicable, the concerned Portfolio's shares
present in person or by proxy at the Meeting. The persons named as proxies will
vote in favor of such adjournment those proxies which they are entitled to vote
in favor of Proposal 1 and will vote against any such adjournment those proxies
required to be voted against that proposal.
Abstentions and, if applicable, broker "non-votes" will not count as votes
in favor of any of the proposals, and broker "non-votes" will not be deemed to
be present at the meeting for purposes of determining whether a particular
proposal to be voted upon has been approved. Broker "non-votes" are shares held
in street name for which the broker indicates that instructions have not been
received from the beneficial owners or other persons entitled to vote and for
which the broker does not have discretionary voting authority.
SHAREHOLDER PROPOSALS
The Fund does not hold regular shareholders' meetings. Proposals of
Shareholders intended to be presented at the next meeting of Shareholders must
be received a reasonable time prior to the mailing of the proxy materials sent
in connection with the meeting, for inclusion in the proxy statement for that
meeting.
REPORTS TO SHAREHOLDERS
THE FUND'S MOST RECENT ANNUAL REPORT FOR ITS MOST RECENT FISCAL YEAR IS
AVAILABLE WITHOUT CHARGE UPON REQUEST FROM ADRIENNE RYAN-PINTO AT DWTC,
HARBORSIDE FINANCIAL CENTER, PLAZA TWO, JERSEY CITY, NEW JERSEY 07311 (TELEPHONE
1-800-869-NEWS (TOLL FREE)).
INTEREST OF CERTAIN PERSONS
DWDC, DWR, the Investment Manager, DWSC, Distributors and certain of their
respective Directors, officers, and employees, including persons who are
Trustees or officers of the Fund, may be deemed to have an interest in certain
of the proposals described in this Proxy Statement to the extent that certain of
such companies and their affiliates have contractual and other arrangements,
described elsewhere in this Proxy Statement, pursuant to which they are paid
fees by the Fund, and certain of those individuals are compensated for
performing services relating to the Fund and may also own shares of DWDC. Such
companies and persons may thus be deemed to derive benefits from the approvals
by Shareholders of such proposals.
OTHER BUSINESS
The management of the Fund knows of no other matters which may be presented
at the Meeting. However, if any matters not now known properly come before the
Meeting, it is the intention of the persons named in the enclosed form of proxy
to vote all shares that they are entitled to vote on any such matter, utilizing
such proxy in accordance with their best judgment on such matters.
By Order of the Board of Trustees
BARRY FINK
SECRETARY
23
<PAGE>
APPENDIX A
FORM OF NEW INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT made as of the [ ] day of [ ], 1997, by and between
Dean Witter Select Dimensions Investment Series, an unincorporated business
trust organized under the laws of the Commonwealth of Massachusetts (hereinafter
called the "Fund"), and Dean Witter InterCapital Inc., a Delaware corporation
(hereinafter called the "Investment Manager"):
WHEREAS, The Fund is engaged in business as an open-end management
investment company and is registered as such under the Investment Company Act of
1940, as amended (the "Act"); and
WHEREAS, The Investment Manager is registered as an investment adviser under
the Investment Advisers Act of 1940, and engages in the business of acting as
investment adviser; and
WHEREAS, The Fund is authorized to issue shares of beneficial interest in
separate portfolios (the "Portfolios") with each Portfolio representing
interests in a separate portfolio of securities and other assets; and
WHEREAS, The Fund currently offers shares in thirteen Portfolios, such
Portfolios together with all other Portfolios subsequently established by the
Fund with respect to which the Fund desires to retain the Investment Manager to
render management and investment advisory services in the manner and on the
terms and conditions hereinafter set forth being collectively referred to as the
"Portfolios;" and
WHEREAS, The Investment Manager desires to be retained to perform services
on said terms and conditions:
Now, Therefore, this Agreement
W I T N E S S E T H:
that in consideration of the premises and the mutual covenants hereinafter
contained, the Fund and the Investment Manager agree as follows:
1. The Fund hereby retains the Investment Manager to act as investment
manager of the Portfolios and, subject to the supervision of the Trustees, to
supervise the investment activities of the Portfolios as hereinafter set forth.
Without limiting the generality of the foregoing, the Investment Manager: shall
obtain and evaluate such information and advice relating to the economy,
securities and commodities markets and securities and commodities as it deems
necessary or useful to discharge its duties hereunder; with respect to the
Portfolios other than such Portfolios in respect of which a Sub-Advisory
Agreement is in effect in accordance with paragraph 2 hereof, shall continuously
manage the assets of the Portfolios in a manner consistent with the investment
objectives and policies of the Portfolios and shall determine the securities and
commodities to be purchased, sold or otherwise disposed of by the Portfolios and
the timing of such purchases, sales and dispositions; with respect to the
Portfolios in respect of which a Sub-Advisory Agreement is in effect in
accordance with paragraph 2 hereof, shall supervise the management of the assets
of the Portfolio in a manner consistent with the investment objectives and
policies of the Portfolio and subject to such other limitations and directions
as the Trustees of the Fund may from time to time prescribe; and shall take such
further action, including the placing of purchase and sale orders on behalf of
the Portfolios other than the Portfolios in respect of which a Sub-Advisory
Agreement is in effect in accordance with paragraph 2 hereof, as the Investment
Manager shall deem necessary or appropriate. The Investment Manager shall also
furnish to or place at the disposal of the Fund such of the information,
evaluations, analyses and opinions formulated or obtained by the Investment
Manager in the discharge of its duties as the Fund may, from time to time,
reasonably request.
A-1
<PAGE>
In the event the Fund establishes another Portfolio other than the current
Portfolios with respect to which it desires to retain the Investment Manager to
render investment advisory services hereunder, it shall notify the Investment
Manager in writing. If the Investment Manager is willing to render such
services, it shall notify the Fund in writing, whereupon such other Portfolio
shall become a Portfolio hereunder.
2. The Investment Manager may, at its own expense, from time to time and in
its discretion, enter into a Sub-Advisory Agreement or Sub-Advisory Agreements
in respect of any of the Portfolios with a Sub-Adviser or Sub-Advisers to make
determinations as to the securities and commodities to be purchased, sold or
otherwise disposed of by the Portfolio and the timing of such purchases, sales
and dispositions and to take such further action, including the placing of
purchase and sale orders on behalf of the Portfolio, as the Sub-Adviser, in
consultation with the Investment Manager, shall deem necessary or appropriate;
provided that the Investment Manager shall be responsible for monitoring
compliance by such Sub-Adviser with the investment policies and restrictions of
the Portfolio and with such other limitations or directions as the Trustees of
the Fund may from time to time prescribe. Upon the termination of any such
Sub-Advisory Agreement, the Investment Manager may assume all of the duties that
were the responsibility of the Sub-Adviser under the Sub-Advisory Agreement.
3. The Investment Manager shall, at its own expense, maintain such staff
and employ or retain such personnel and consult with such other persons as it
shall from time to time determine to be necessary or useful to the performance
of its obligations under this Agreement. Without limiting the generality of the
foregoing, the staff and personnel of the Investment Manager shall be deemed to
include persons employed or otherwise retained by the Investment Manager to
furnish statistical and other factual data, advice regarding economic factors
and trends, information with respect to technical and scientific developments,
and such other information, advice and assistance as the Investment Manager may
desire. The Investment Manager shall, as agent for the Fund, maintain the Fund's
records and books of account (other than those maintained by the Fund's transfer
agent, registrar, custodian and other agencies). All such books and records so
maintained shall be the property of the Fund and, upon request therefor, the
Investment Manager shall surrender to the Fund such of the books and records so
requested.
4. The Fund will, from time to time, furnish or otherwise make available to
the Investment Manager such financial reports, proxy statements and other
information relating to the business and affairs of the Fund as the Investment
Manager may reasonably require in order to discharge its duties and obligations
hereunder.
5. The Investment Manager shall bear the cost of rendering the investment
management and supervisory services to be performed by it under this Agreement,
and shall, at its own expense, pay the compensation of the officers and
employees, if any, of the Fund, and provide such office space, facilities and
equipment and such clerical help and bookkeeping services as the Fund shall
reasonably require in the conduct of its business. The Investment Manager shall
also bear the cost of telephone service, heat, light, power and other utilities
provided to the Fund.
6. The Fund assumes and shall pay or cause to be paid all other expenses of
the Fund, including without limitation: the charges and expenses of any
registrar, any custodian or depository appointed by the Fund for the safekeeping
of its cash, portfolio securities or commodities and other property, and any
stock transfer or dividend agent or agents appointed by the Fund; brokers'
commissions chargeable to the Fund in connection with portfolio transactions to
which the Fund is a party; all taxes, including securities or commodities
issuance and transfer taxes, and fees payable by the Fund to federal, state or
other governmental agencies; the cost and expense of engraving or printing
certificates representing shares of the Fund; all costs and expenses in
connection with the registration and maintenance of registration of the Fund and
its shares with the Securities and Exchange Commission and various states and
other jurisdictions (including filing fees and legal fees and disbursements of
counsel); the cost
A-2
<PAGE>
and expense of printing (including typesetting) and distributing prospectuses
and statements of additional information of the Fund and supplements thereto to
the Fund's shareholders; all expenses of shareholders' and Trustees' meetings
and of preparing, printing and mailing proxy statements and reports to
shareholders; fees and travel expenses of Trustees or members of any advisory
board or committee who are not employees of the Investment Manager or any
corporate affiliate of the Investment Manager; all expenses incident to the
payment of any dividend, distribution, withdrawal or redemption, whether in
shares or in cash; charges and expenses of any outside service used for pricing
of the Fund's shares; charges and expenses of legal counsel, including counsel
to the Trustees of the Fund who are not interested persons (as defined in the
Act) of the Fund or the Investment Manager, and of independent accountants, in
connection with any matter relating to the Fund; membership dues of industry
associations; interest payable on Fund borrowings; postage; insurance premiums
on property or personnel (including officers and Trustees) of the Fund which
inure to its benefit; extraordinary expenses (including, but not limited to,
legal claims and liabilities and litigation costs and any indemnification
related thereto); and all other charges and costs of the Fund's operation unless
otherwise explicitly provided herein.
7. For the services to be rendered, the facilities furnished, and the
expenses assumed by the Investment Manager, the various Portfolios of the Fund
shall pay to the Investment Manager monthly compensation determined by applying
the following annual rates to the daily net assets of the respective Portfolios
determined as of the close of each business day: (a) the Money Market Portfolio
- -- 0.50%; (b) the North American Government Securities Portfolio -- 0.65%; (c)
the Diversified Income Portfolio -- 0.40%; (d) the Balanced Portfolio -- 0.75%;
(e) the Utilities Portfolio -- 0.65%; (f) the Dividend Growth Portfolio --
0.625%; (g) the Value-Added Market Portfolio -- 0.50%; (h) the Core Equity
Portfolio -- 0.85%; (i) the American Value Portfolio -- 0.625%; (j) the Mid-Cap
Growth Portfolio -- 0.75%; (k) the Global Equity Portfolio -- 1.0%; (l) the
Developing Growth Portfolio -- 0.50%; and (m) the Emerging Markets Portfolio --
1.25%. Except as hereinafter set forth, compensation under this Agreement shall
be calculated and accrued daily and the amounts of the daily accruals shall be
paid monthly. Such calculations shall be made by applying 1/365ths of the annual
rates to the net assets of the respective Portfolios each day determined as of
the close of business on that day or the last previous business day. If this
Agreement becomes effective subsequent to the first day of a month or shall
terminate before the last day of a month, compensation for that part of the
month this Agreement is in effect shall be prorated in a manner consistent with
the calculation of the fees as set forth above.
Subject to the provisions of paragraph 8 hereof, payment of the Investment
Manager's compensation for the preceding month shall be made as promptly as
possible after completion of the computations contemplated by paragraph 8
hereof.
8. In the event that the operating expenses of any of the Money Market
Portfolio, the North American Government Securities Portfolio, the Diversified
Income Portfolio, the Balanced Portfolio, the Utilities Portfolio, the Dividend
Growth Portfolio, the Value-Added Market Portfolio, the Core Equity Portfolio,
the American Value Portfolio, the Global Equity Portfolio, the Developing Growth
Portfolio or the Emerging Markets Portfolio, including amounts payable to the
Investment Manager pursuant to paragraph 7 hereof, for any year ending on a date
on which this Agreement is in effect exceed 2.5% of the average daily net assets
of such Portfolio up to $30 million, 2.0% of the next $70 million and 1.5% of
the average daily net assets of such Portfolio in excess of $100 million (the
"expense limitation" of these Portfolios), the Investment Manager shall reduce
its management fee in respect of such Portfolio to the extent of such excess and
will reimburse such Portfolio for annual operating expenses in excess of the
expense limitation, up to the amount of the management fee for that Portfolio
which otherwise would be payable for that year; provided, however, there shall
be excluded from such expenses the amount of any interest, taxes, brokerage
commissions and extraordinary expenses (including but not limited to legal
claims and liabilities and litigation costs and any indemnification related
thereto) paid or payable by such
A-3
<PAGE>
Portfolio. Such reduction, if any, shall be computed and accrued daily, shall be
settled on a monthly basis, and shall be based upon the expense limitation
applicable to such Portfolio as at the end of the last business day of the
month.
9. The Investment Manager will use its best efforts in the supervision and
management of the investment activities of the Fund, but in the absence of
willful misfeasance, bad faith, gross negligence or reckless disregard of its
obligations hereunder, the Investment Manager shall not be liable to the Fund or
any of its investors for any error of judgment or mistake of law or for any act
or omission by the Investment Manager or for any losses sustained by the Fund or
its investors.
10. Nothing contained in this Agreement shall prevent the Investment Manager
or any affiliated person of the Investment Manager from acting as investment
adviser or manager for any other person, firm or corporation and shall not in
any way bind or restrict the Investment Manager or any such affiliated person
from buying, selling or trading any securities or commodities for their own
accounts or for the account of others for whom they may be acting. Nothing in
this Agreement shall limit or restrict the right of any Trustee, officer or
employee of the Investment Manager to engage in any other business or to devote
his or her time and attention in part to the management or other aspects of any
other business whether of a similar or dissimilar nature.
11. This Agreement shall remain in effect until April 30, 1999 and from year
to year thereafter with respect to each Portfolio provided such continuance with
respect to a Portfolio is approved at least annually by the vote of holders of a
majority (as defined in the Act) of the outstanding voting securities of such
Portfolio or by the Trustees of the Fund; provided that in either event such
continuance is also approved annually by the vote of a majority of the Trustees
of the Fund who are not parties to this Agreement or "interested parties" (as
defined in the Act) of any such party, which vote must be cast in person at a
meeting called for the purpose of voting on such approval; provided, however,
that (a) the Fund may, at any time and without the payment of any penalty,
terminate this Agreement upon thirty days' written notice to the Investment
Manager, either by majority vote of the Trustees of the Fund or, with respect to
a Portfolio, by the vote of a majority of the outstanding voting securities of
such Portfolio; (b) this Agreement shall immediately terminate in the event of
its assignment (to the extent required by the Act and the rules thereunder)
unless such automatic terminations shall be prevented by an exemptive order of
the Securities and Exchange Commission; and (c) the Investment Manager may
terminate this Agreement without payment of penalty on thirty days' written
notice to the Fund. Any notice under this Agreement shall be given in writing,
addressed and delivered, or mailed post-paid, to the other party at the
principal office of such party.
Any approval of this Agreement by the holders of a majority of the
outstanding voting securities of any Portfolio shall be effective to continue
this Agreement with respect to such Portfolio notwithstanding (a) that this
Agreement has not been approved by the holders of a majority of the outstanding
voting securities of any other Portfolio or (b) that this Agreement has not been
approved by the vote of a majority of the outstanding voting securities of the
Fund, unless such approval shall be required by any other applicable law or
otherwise.
12. This Agreement may be amended by the parties without the vote or consent
of the shareholders of the Fund to supply any omission, to cure, correct or
supplement any ambiguous, defective or inconsistent provision hereof, or if they
deem it necessary to conform this Agreement to the requirements of applicable
federal laws or regulations, but neither the Fund nor the Investment Manager
shall be liable for failing to do so.
13. This Agreement shall be construed in accordance with the laws of the
State of New York and the applicable provisions of the Act. To the extent the
applicable law of the State of New York, or any of the provisions herein,
conflicts with the applicable provisions of the Act, the latter shall control.
A-4
<PAGE>
14. The Investment Manager and the Fund each agree that the name "Dean
Witter," which comprises a component of the Fund's name, is a property right of
Dean Witter Reynolds Inc. The Fund agrees and consents that (i) it will only use
the name "Dean Witter" as a component of its name and for no other purpose, (ii)
it will not purport to grant to any third party the right to use the name "Dean
Witter" for any purpose, (iii) the Investment Manager or its parent, Morgan
Stanley, Dean Witter, Discover & Co., or any corporate affiliate of the
Investment Manager's parent, may use or grant to others the right to use the
name "Dean Witter," or any combination or abbreviation thereof, as all or a
portion of a corporate or business name or for any commercial purpose, including
a grant of such right to any other investment company, (iv) at the request of
the Investment Manager or its parent, the Fund will take such action as may be
required to provide its consent to the use of the name "Dean Witter," or any
combination or abbreviation thereof, by the Investment Manager or its parent or
any corporate affiliate of the Investment Manager's parent, or by any person to
whom the Investment Manager or its parent or any corporate affiliate of the
Investment Manager's parent shall have granted the right to such use, and (v)
upon the termination of any investment advisory agreement into which the
Investment Manager and the Fund may enter, or upon termination of affiliation of
the Investment Manager with its parent, the Fund shall, upon request by the
Investment Manager or its parent, cease to use the name "Dean Witter" as a
component of its name, and shall not use the name, or any combination or
abbreviation thereof, as a part of its name or for any other commercial purpose,
and shall cause its officers, Trustees and shareholders to take any and all
actions which the Investment Manager or its parent may request to effect the
foregoing and to reconvey to the Investment Manager or its parent any and all
rights to such name.
15. The Declaration of Trust establishing Dean Witter Select Dimensions
Investment Series, dated June 2, 1994, a copy of which, together with all
amendments thereto (the "Declaration"), is on file in the office of the
Secretary of the Commonwealth of Massachusetts, provides that the name Dean
Witter Select Dimensions Investment Series refers to the Trustees under the
Declaration collectively as Trustees, but not as individuals or personally; and
no Trustee, shareholder, officer, employee or agent of Dean Witter Select
Dimensions Investment Series shall be held to any personal liability, nor shall
resort be had to their private property for the satisfaction of any obligation
or claim or otherwise, in connection with the affairs of said Dean Witter Select
Dimensions Investment Series, but the Trust Estate only shall be liable.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the day and year first above written in New York, New York.
DEAN WITTER SELECT DIMENSIONS
INVESTMENT SERIES
By
--------------------------------------
Attest:
--------------------------------------
DEAN WITTER INTERCAPITAL INC.
By
--------------------------------------
Attest:
--------------------------------------
A-5
<PAGE>
APPENDIX B
InterCapital serves as investment manager to the Fund and the other
investment companies listed below which have similar investment objectives to
those of the Money Market Portfolio of the Fund. Set forth below is a chart
showing the net assets of each such investment company as of March 12, 1997 and
the investment management fees rate(s) applicable to such investment company.
<TABLE>
<CAPTION>
CURRENT INVESTMENT
MANAGEMENT FEE RATE(S)
NET ASSETS AS A PERCENTAGE
AS OF 03/12/97 OF NET ASSETS
--------------- -----------------------------
<C> <S> <C> <C>
1. ACTIVE ASSETS CALIFORNIA TAX-FREE TRUST.............................. $ 440,611,354 0.50% on assets up to $500
million, scaled down at
various asset levels to 0.25%
on assets over $3 billion
2. ACTIVE ASSETS GOVERNMENT SECURITIES TRUST............................ $ 681,982,027 0.50% on assets up to $500
million, scaled down at
various asset levels to 0.25%
on assets over $3 billion
3. ACTIVE ASSETS MONEY TRUST............................................ $ 8,921,354,553 0.50% on assets up to $500
million, scaled down at
various asset levels to 0.25%
on assets over $3 billion
4. ACTIVE ASSETS TAX-FREE TRUST......................................... $ 1,751,293,513 0.50% on assets up to $500
million, scaled down at
various asset levels to 0.25%
on assets over $3 billion
5. DEAN WITTER CALIFORNIA TAX-FREE DAILY INCOME TRUST................... $ 266,303,159 0.50% on assets up to $500
million, scaled down at
various asset levels to 0.25%
on assets over $3 billion
6. DEAN WITTER LIQUID ASSET FUND INC. .................................. $12,519,913,252 0.50% on assets up to $500
million, scaled down at
various asset levels to
0.248% on assets over $17.5
billion
7. DEAN WITTER NEW YORK MUNICIPAL MONEY MARKET TRUST.................... $ 41,418,939 0.50% on assets up to $500
million, scaled down at
various asset levels to 0.25%
on assets over $3 billion
8. DEAN WITTER TAX-FREE DAILY INCOME TRUST.............................. $ 555,640,894 0.50% on assets up to $500
million, scaled down at
various asset levels to 0.25%
on assets over $3 billion
9. DEAN WITTER U.S. GOVERNMENT MONEY MARKET TRUST....................... $ 933,178,675 0.50% on assets up to $500
million, scaled down at
various asset levels to 0.25%
on assets over $3 billion
10. DEAN WITTER RETIREMENT SERIES:
(A) LIQUID ASSET SERIES.............................................. $ 23,818,464 0.50%(1)
(B) U.S. GOVERNMENT MONEY MARKET SERIES.............................. $ 7,400,809 0.50%(1)
11. DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES:*
(A) MONEY MARKET PORTFOLIO........................................... $ 84,905,881 0.50%
12. DEAN WITTER VARIABLE INVESTMENT SERIES:*
(A) MONEY MARKET PORTFOLIO........................................... $ 339,300,697 0.50%
</TABLE>
- ------------------------------
* Open-end investment company offered only to life insurance companies in
connection with variable annuity and/or variable life insurance contracts.
(1) InterCapital has undertaken, until July 31, 1997, to continue to assume all
operating expenses of the Series of Dean Witter Retirement Series (except
for any brokerage fees and a portion of organizational expenses) and to
waive the compensation provided for each Series in its investment management
agreement with that company to the extent that such expenses and
compensation on an annualized basis exceed 1.0% of the daily net assets of
the pertinent Series.
B-1
<PAGE>
InterCapital serves as investment manager to the Fund and the other
investment companies listed below which have similar investment objectives to
those of the North American Government Securities Portfolio and the Diversified
Income Portfolio of the Fund. Set forth below is a chart showing the net assets
of each such investment company as of March 12, 1997 and the investment
management fee rate(s) applicable to such investment company.
<TABLE>
<CAPTION>
CURRENT INVESTMENT
MANAGEMENT FEE RATE(S)
NET ASSETS AS A PERCENTAGE
AS OF 03/12/97 OF NET ASSETS
-------------- -----------------------------
<C> <S> <C> <C>
1. DEAN WITTER HIGH YIELD SECURITIES INC.*.............................. $472,422,555 0.50% on assets up to $500
million, scaled down at
various asset levels to 0.30%
on assets over $3 billion
2. DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST*........................ 6$,138,047,889 0.50% on assets up to $1
billion, scaled down at
various asset levels to 0.30%
on assets over $12.5 billion
3. DEAN WITTER CONVERTIBLE SECURITIES TRUST*............................ $258,071,153 0.60% on assets up to $750
million, scaled down at
various asset levels to
0.425% on assets over $3
billion
4. DEAN WITTER FEDERAL SECURITIES TRUST*................................ $664,434,512 0.55% on assets up to $1
billion, scaled down at
various asset levels to 0.35%
on assets over $12.5 billion
5. INTERCAPITAL INCOME SECURITIES INC.**................................ $212,194,831 0.50%
6. HIGH INCOME ADVANTAGE TRUST**........................................ $151,432,410 0.75% on assets up to $250
million, scaled down at
various asset levels to 0.30%
on assets over $1 billion
7. HIGH INCOME ADVANTAGE TRUST II**..................................... $202,120,811 0.75% on assets up to $250
million, scaled down at
various asset levels to 0.30%
on assets over $1 billion
8. HIGH INCOME ADVANTAGE TRUST III**.................................... $ 78,703,844 0.75% on assets up to $250
million, scaled down at
various asset levels to 0.30%
on assets over $1 billion
9. DEAN WITTER INTERMEDIATE INCOME SECURITIES*.......................... $183,322,983 0.60% on assets up to $500
million, scaled down at
various asset levels to 0.30%
on assets over $1 billion
10. DEAN WITTER WORLD WIDE INCOME TRUST*................................. $106,393,288 0.75% on assets up to $250
million, scaled down at
various asset levels to 0.30%
on assets over $1 billion
11. DEAN WITTER GOVERNMENT INCOME TRUST**................................ $425,720,030 0.60%
12. DEAN WITTER GLOBAL SHORT-TERM INCOME FUND INC.*...................... $ 76,976,109 0.55% on assets up to $500
million and 0.50% on assets
over $500 million
13. DEAN WITTER PREMIER INCOME TRUST*.................................... $ 15,604,354 0.50% (of which 40% is paid
to a Sub-Adviser)
14. DEAN WITTER SHORT-TERM U.S. TREASURY TRUST*.......................... $255,026,002 0.35%
15. DEAN WITTER DIVERSIFIED INCOME TRUST*................................ $825,332,503 0.40%
</TABLE>
B-2
<PAGE>
<TABLE>
<CAPTION>
CURRENT INVESTMENT
MANAGEMENT FEE RATE(S)
NET ASSETS AS A PERCENTAGE
AS OF 03/12/97 OF NET ASSETS
-------------- -----------------------------
<C> <S> <C> <C>
16. DEAN WITTER SHORT-TERM BOND FUND*.................................... $ 39,265,837 0.70%(1)
17. DEAN WITTER HIGH INCOME SECURITIES*.................................. 1$,105,732,108 0.50% on assets up to $500
million and 0.425% on assets
over $500 million.
18. PRIME INCOME TRUST**................................................. 1$,133,529,314 0.90% on assets up to $500
million and 0.85% on assets
over $500 million
19. DEAN WITTER BALANCED INCOME FUND*.................................... $ 50,991,701 0.60%
20. DEAN WITTER RETIREMENT SERIES:*
(a) U.S. GOVERNMENT SECURITIES SERIES................................ $ 10,596,158 0.65% (2)
(b) INTERMEDIATE INCOME SECURITIES SERIES............................ $ 2,261,816 0.65% (2)
21. DEAN WITTER VARIABLE INVESTMENT SERIES:***
(a) QUALITY INCOME PLUS PORTFOLIO.................................... $459,554,792 0.50% on assets up to $500
million and 0.45% on assets
over $500 million
(b) HIGH YIELD PORTFOLIO............................................. $277,126,804 0.50%
22. DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES:***
(a) DIVERSIFIED INCOME PORTFOLIO..................................... $ 37,415,339 0.40%
(b) NORTH AMERICAN GOVERNMENT SECURITIES PORTFOLIO................... $ 4,484,769 0.65% (of which 40% is paid
to a Sub-Adviser)
23. DEAN WITTER INTERMEDIATE TERM U.S. TREASURY TRUST*................... $ 1,962,920 0.35%(3)
</TABLE>
- ------------------------------
* Open-end investment company.
** Closed-end investment company.
*** Open-end investment company offered only to life insurance companies in
connection with variable annuity and/or variable life insurance contracts.
(1) InterCapital has undertaken, from January 1, 1997 through April 30, 1997, to
assume all operating expenses of Dean Witter Short-Term Bond Fund (except
for any brokerage fees) and to waive the compensation provided for in its
investment management agreement with that company.
(2) InterCapital has undertaken, until July 31, 1997, to continue to assume all
operating expenses of the Series of Dean Witter Retirement Series (except
for brokerage fees and a portion of organizational expenses) and to waive
the compensation provided for each Series in its investment management
agreement with that company in respect of each Series to the extent that
such expenses and compensation on an annualized basis exceed 1.0% of the
average daily net assets of the pertinent Series.
(3) InterCapital has undertaken to assume all operating expenses of Dean Witter
Intermediate Term U.S. Treasury Trust (except for any 12b-1 fees and
brokerage expenses) and to waive the compensation provided for in its
investment management agreement with that company until such time as that
company has $50 million of net assets or until March 27, 1997, whichever
occurs first.
B-3
<PAGE>
InterCapital serves as investment manager to the Fund and the other
investment companies listed below which have similar investment objectives to
those of the Balanced Portfolio, the Utilities Portfolio, the Dividend Growth
Portfolio, the Value-Added Market Portfolio, the Core Equity Portfolio, the
American Value Portfolio, the Mid-Cap Growth Portfolio, the Global Equity
Portfolio, the Developing Growth Portfolio and the Emerging Markets Portfolio of
the Fund. Set forth below is a chart showing the net assets of each such
investment company as of March 12, 1997 and the investment management fee
rate(s) applicable to such investment company.
<TABLE>
<CAPTION>
CURRENT INVESTMENT MANAGEMENT
NET ASSETS AS FEE RATE(S)
OF AS A PERCENTAGE
03/12/97 OF NET ASSETS
--------------- -----------------------------
<C> <S> <C> <C>
1. DEAN WITTER AMERICAN VALUE FUND..................................... $ 3,370,632,376 0.625% on assets up to $250
million, scaled down at
various asset levels to
0.475% on assets over $2.5
billion
2. DEAN WITTER BALANCED GROWTH FUND.................................... $ 125,426,874 0.60%
3. DEAN WITTER CAPITAL APPRECIATION FUND............................... $ 323,927,003 0.75%
4. DEAN WITTER CAPITAL GROWTH SECURITIES............................... $ 505,754,103 0.65% on assets up to $500
million, scaled down at
various asset levels to
0.475% on assets over $1.5
billion
5. DEAN WITTER DEVELOPING GROWTH SECURITIES TRUST...................... $ 726,490,573 0.50% on assets up to $500
million and 0.475% on assets
over $500 million
6. DEAN WITTER DIVIDEND GROWTH SECURITIES INC.......................... $13,188,289,520 0.625% on assets up to $250
million, scaled down at
various asset levels to 0.30%
on assets over $10 billion
7. DEAN WITTER EUROPEAN GROWTH FUND INC................................ $ 1,509,995,436 1.00% on assets up to $500
million and 0.95% on assets
over $500 million (of which
40% is paid to a Sub-Adviser)
8. DEAN WITTER FINANCIAL SERVICES TRUST................................ $ 154,411,700 0.75%
9. DEAN WITTER GLOBAL ASSET ALLOCATION FUND............................ $ 64,921,778 1.00% (of which 60% is paid
to two Sub-Advisers)
10. DEAN WITTER GLOBAL DIVIDEND GROWTH SECURITIES....................... $ 3,065,931,979 0.75% on assets up to $1
billion, scaled down at
various asset levels to
0.675% on assets over $2.5
billion
11. DEAN WITTER GLOBAL UTILITIES FUND................................... $ 354,011,304 0.65%
12. DEAN WITTER HEALTH SCIENCES TRUST................................... $ 463,792,920 1.00% on assets up to $500
million and 0.95% on assets
over $500 million
13. DEAN WITTER INCOME BUILDER FUND..................................... $ 245,689,401 0.75%
14. DEAN WITTER INFORMATION FUND........................................ $ 239,136,659 0.75%
15. DEAN WITTER INTERNATIONAL SMALLCAP FUND............................. $ 109,461,789 1.25% (of which 40% is paid
to a Sub-Adviser)
16. DEAN WITTER JAPAN FUND.............................................. $ 193,493,375 1.0% (of which 40% is paid to
a Sub-Adviser)
17. DEAN WITTER MARKET LEADER TRUST..................................... $ 100,000 0.75% (1)
18. DEAN WITTER MID-CAP GROWTH FUND..................................... $ 409,527,028 0.75%
19. DEAN WITTER NATURAL RESOURCE DEVELOPMENT SECURITIES INC............. 255,182,300
$ 0.625% on assets up to $250
million and 0.50% on assets
over $250 million
</TABLE>
B-4
<PAGE>
<TABLE>
<CAPTION>
CURRENT INVESTMENT MANAGEMENT
NET ASSETS AS FEE RATE(S)
OF AS A PERCENTAGE
03/12/97 OF NET ASSETS
--------------- -----------------------------
<C> <S> <C> <C>
20. DEAN WITTER PACIFIC GROWTH FUND INC................................. $ 1,504,922,981 1.00% on assets up to $1
billion and 0.95% on assets
over $1 billion (of which 40%
is paid to a Sub-Adviser)
21. DEAN WITTER PRECIOUS METALS AND MINERALS TRUST...................... $ 59,639,235 0.80%
22. DEAN WITTER SPECIAL VALUE FUND...................................... $ 246,216,395 0.75%
23. DEAN WITTER STRATEGIST FUND......................................... $ 1,435,020,832 0.60% on assets up to $500
million, scaled down at
various asset levels to
0.475% on assets over $1.5
billion
24. DEAN WITTER UTILITIES FUND.......................................... $ 2,517,911,689 0.65% on assets up to $500
million, scaled down at
various asset levels to
0.425% on assets over $5
billion
25. DEAN WITTER VALUE-ADDED MARKET SERIES............................... $ 1,232,708,381 0.50% on assets up to $500
million, scaled down at
various asset levels to
0.425% on assets over $1
billion
26. DEAN WITTER WORLD WIDE INVESTMENT TRUST............................. $ 438,134,738 1.0% on assets up to $500
million and 0.95% on assets
over $500 million (of which
40% is paid to a Sub-Adviser)
27. DEAN WITTER RETIREMENT SERIES:
(A) AMERICAN VALUE SERIES........................................... $ 44,710,329 0.85% (2)
(B) CAPITAL GROWTH SERIES........................................... $ 2,753,853 0.85% (2)
(C) DIVIDEND GROWTH SERIES.......................................... $ 92,596,787 0.75% (2)
(D) GLOBAL EQUITY SERIES............................................ $ 16,316,755 1.00% (2)
(E) STRATEGIST SERIES............................................... $ 22,235,461 0.85% (2)
(F) UTILITIES SERIES................................................ $ 5,890,044 0.75% (2)
(G) VALUE-ADDED MARKET SERIES....................................... $ 19,935,888 0.50% (2)
28. DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES:*
(A) AMERICAN VALUE PORTFOLIO........................................ $ 142,691,109 0.625%
(B) BALANCED PORTFOLIO.............................................. $ 46,432,529 0.75% (of which 40% is paid
to a Sub-Adviser)
(C) CORE EQUITY PORTFOLIO........................................... $ 22,871,602 0.85% (of which 40% is paid
to a Sub-Adviser)
(D) DEVELOPING GROWTH PORTFOLIO..................................... $ 62,776,199 0.50%
(E) DIVIDEND GROWTH PORTFOLIO....................................... $ 313,542,513 0.625%
(F) EMERGING MARKETS PORTFOLIO...................................... $ 21,698,779 1.25% (of which 40% is paid
to a Sub-Adviser)
(G) GLOBAL EQUITY PORTFOLIO......................................... $ 68,541,265 1.00%
(H) MID-CAP GROWTH PORTFOLIO........................................ $ 3,805,149 0.75% (3)
(I) UTILITIES PORTFOLIO............................................. $ 36,684,324 0.65%
(J) VALUE-ADDED MARKET PORTFOLIO.................................... $ 87,489,055 0.50%
29. DEAN WITTER VARIABLE INVESTMENT SERIES:*
(A) CAPITAL APPRECIATION PORTFOLIO.................................. $ 8,143,548 0.75% (4)
(B) CAPITAL GROWTH PORTFOLIO........................................ $ 94,830,181 0.65%
(C) DIVIDEND GROWTH PORTFOLIO....................................... $ 1,411,963,686 0.625% on assets up to $500
million, scaled down at
various asset levels to
0.475% on assets over $1
billion
</TABLE>
B-5
<PAGE>
<TABLE>
<CAPTION>
CURRENT INVESTMENT MANAGEMENT
NET ASSETS AS FEE RATE(S)
OF AS A PERCENTAGE
03/12/97 OF NET ASSETS
--------------- -----------------------------
<C> <S> <C> <C>
(D) EQUITY PORTFOLIO................................................ $ 582,707,983 0.50% on assets up to $1
billion and 0.475% on assets
over $1 billion
(E) EUROPEAN GROWTH PORTFOLIO....................................... $ 327,394,722 1.00% (of which 40% is paid
to a Sub-Adviser)
(F) GLOBAL DIVIDEND GROWTH PORTFOLIO................................ $ 361,396,602 0.75%
(G) INCOME BUILDER PORTFOLIO........................................ $ 8,047,838 0.75% (4)
(H) PACIFIC GROWTH PORTFOLIO........................................ $ 136,946,030 1.00% (of which 40% is paid
to a Sub-Adviser)
(I) STRATEGIST PORTFOLIO............................................ $ 446,279,938 0.50%
(J) UTILITIES PORTFOLIO............................................. $ 423,303,421 0.65% on assets up to $500
million and 0.55% on assets
over $500 million
</TABLE>
- ------------------------------
* Open-end investment company offered only to life insurance companies in
connection with variable annuity and/or variable life insurance contracts.
(1) InterCapital has undertaken to assume all operating expenses of Dean Witter
Market Leader Trust (except for any 12b-1 fees and brokerage fees) and to
waive the compensation provided for in its investment management agreement
with that company until such time as that company has $50 million of net
assets or until six months from that company's commencement of operations.
Dean Witter Market Leader Trust is expected to commence operations on or
about April 28, 1997.
(2) InterCapital has undertaken, until July 31, 1997, to continue to assume all
operating expenses of the Series of Dean Witter Retirement Series (except
for any brokerage fees and a portion of organizational expenses) and to
waive the compensation provided for each Series in its investment management
agreement with that company to the extent that such expenses and
compensation on an annualized basis exceed 1.0% of the daily net assets of
the pertinent Series.
(3) InterCapital has undertaken, until the earlier of July 21, 1997 or the
attainment by the Portfolio of $50 million of net assets, to assume all
operating expenses (except for any brokerage fees) of the Mid-Cap Growth
Portfolio of Dean Witter Select Dimensions Investment Series and to waive
the compensation provided for that Portfolio in its investment management
agreement with the company.
(4) InterCapital has undertaken, until the earlier of July 21, 1997 or the
attainment by the respective Portfolio of $50 million of net assets, to
assume all operating expenses (except for any brokerage fees) of the Income
Builder Portfolio and the Capital Appreciation Portfolio of Dean Witter
Variable Investment Series and to waive the compensation provided for each
of these Portfolios in its investment management agreement with that
company.
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APPENDIX C
FORM OF NEW SUB-ADVISORY AGREEMENT
AGREEMENT made as of the [ ] day of [ ], 1997, by and between
Dean Witter InterCapital Inc., a Delaware corporation (hereinafter called the
"Investment Manager"), and TCW Funds Management, Inc., a California corporation
(hereinafter called the "Sub-Adviser").
WHEREAS, Dean Witter Select Dimensions Investment Series (hereinafter called
the "Fund") is engaged in business as an open-end management investment company
and is registered as such under the Investment Company Act of 1940, as amended
(the "Act"); and
WHEREAS, the Investment Manager has entered into an Investment Management
Agreement (hereinafter called the "Investment Management Agreement") with the
Fund wherein the Investment Manager has agreed to provide investment management
services to the thirteen current Portfolios of the Fund and may provide such
services to other Portfolios subsequently established by the Fund; and
WHEREAS, the Sub-Adviser is registered as an investment adviser under the
Investment Advisers Act of 1940, and engages in the business of acting as an
investment adviser; and
WHEREAS, the Investment Manager desires to retain the services of the
Sub-Adviser to render investment advisory services for each of the North
American Government Securities Portfolio, the Balanced Portfolio, the Core
Equity Portfolio and the Emerging Markets Portfolio in the manner and on the
terms and conditions hereinafter set forth (these Portfolios together with all
other Portfolios subsequently established by the Fund with respect to which the
Fund will have retained the Investment Manager to render management and
investment advisory services under the Investment Management Agreement and with
respect to which the Investment Manager desires to retain the Sub-Adviser to
render investment advisory services in the manner and on the terms and
conditions hereinafter set forth being collectively referred to as the
"Sub-Advisory Portfolios"); and
WHEREAS, the Sub-Adviser desires to be retained by the Investment Manager to
perform services on said terms and conditions:
NOW, THEREFORE, in consideration of the mutual covenants and agreements of
the parties hereto as herein set forth, the parties covenant and agree as
follows:
1. Subject to the supervision of the Fund, its officers and Trustees, and
the Investment Manager, and in accordance with the investment objectives,
policies and restrictions set forth in the then current Registration Statement
relating to the Fund, and such investment objectives, policies and restrictions
from time to time prescribed by the Trustees of the Fund and communicated by the
Investment Manager to the Sub-Adviser, the Sub-Adviser agrees to provide each
Sub-Advisory Portfolio with investment advisory services; to obtain and evaluate
such information and advice relating to the economy, securities and commodities
markets and securities or commodities as it deems necessary or useful to
discharge its duties hereunder; to continuously manage the assets of the
Sub-Advisory Portfolio in a manner consistent with the investment objective and
policies of the Sub-Advisory Portfolio; to make decisions as to foreign currency
matters and make determinations as to forward foreign exchange contracts and
options and futures contracts in foreign currencies; to determine the securities
and commodities to be purchased or otherwise acquired, or sold or otherwise
disposed of, by the Sub-Advisory Portfolio and the timing of such purchases,
acquisitions, sales and dispositions; to take such further action, including the
placing of purchase and sale orders on behalf of the Sub-Advisory Portfolio, as
it shall deem necessary or appropriate; to furnish to or place at the disposal
of the Sub-Advisory Portfolio and the Investment Manager such of the
information, evaluations, analyses and opinions formulated or obtained by it in
the discharge
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of its duties as the Fund and the Investment Manager may, from time to time,
reasonably request. The Investment Manager and the Sub-Adviser shall each make
its officers and employees available to the other from time to time at
reasonable times to review investment policies of the Sub-Advisory Portfolios
and to consult with each other.
In the event the Fund establishes another Portfolio other than the current
Sub-Advisory Portfolios with respect to which the Investment Manager desires to
retain the Sub-Adviser to render investment advisory services hereunder, the
Investment Manager shall notify the Sub-Adviser in writing. If the Sub-Adviser
is willing to render such services, it shall notify the Investment Manager in
writing, whereupon such other Portfolio shall become a Sub-Advisory Portfolio
hereunder.
2. The Sub-Adviser may, at its own expense, from time to time and in its
discretion, enter into a Secondary Sub-Advisory Agreement or Secondary
Sub-Advisory Agreements in respect of any of the Sub-Advisory Portfolios with a
Secondary Sub-Adviser or Secondary Sub-Advisers to assist it in making
determinations as to the securities and commodities to be purchased or otherwise
acquired, or sold or otherwise disposed of, by the Sub-Advisory Portfolio and
the timing of such purchases, acquisitions, sales and dispositions and to take
such further action, including the placing of purchase and sale orders on behalf
of the Sub-Advisory Portfolio, as the Secondary Sub-Adviser, in consultation
with the Sub-Adviser, shall deem necessary or appropriate; provided that the
Sub-Adviser shall be responsible for monitoring compliance by such Secondary
Sub-Adviser with the investment policies and restrictions of the Sub-Advisory
Portfolio and with such other limitations or directions as the Trustees of the
Fund may from time to time prescribe. Upon the termination of any such Secondary
Sub-Advisory Agreement, the Sub-Adviser may assume all of the duties that were
the responsibility of the Secondary Sub-Adviser under the Secondary Sub-Advisory
Agreement.
3. The Sub-Adviser shall, at its own expense, maintain such staff and
employ or retain such personnel and consult with such other persons as it shall
from time to time determine to be necessary or useful to the performance of its
obligations under this Agreement. Without limiting the generality of the
foregoing, the staff and personnel of the Sub-Adviser shall be deemed to include
persons employed or otherwise retained by the Sub-Adviser to furnish statistical
and other factual data, advice regarding economic factors and trends,
information with respect to technical and scientific developments, and such
other information, advice and assistance as the Investment Manager may desire.
The Sub-Adviser shall maintain whatever records as may be required to be
maintained by it under the Act. All such records so maintained shall be made
available to the Fund, upon the request of the Investment Manager or the Fund.
4. The Fund will, from time to time, furnish or otherwise make available to
the Sub-Adviser such financial reports, proxy statements and other information
relating to the business and affairs of the Sub-Advisory Portfolios as the
Sub-Adviser may reasonably require in order to discharge its duties and
obligations hereunder or to comply with any applicable law and regulations and
the investment objectives, policies and restrictions from time to time
prescribed by the Trustees of the Fund.
5. The Sub-Adviser shall bear the cost of rendering the investment advisory
services to be performed by it under this Agreement, and shall, at its own
expense, pay the compensation of the officers and employees, if any, of the
Fund, employed by the Sub-Adviser, and such clerical help and bookkeeping
services as the Sub-Adviser shall reasonably require in performing its duties
hereunder.
6. The Fund, on behalf of each Sub-Advisory Portfolio, assumes and shall
pay or cause to be paid all other expenses of the Sub-Advisory Portfolio,
including, without limitation: any fees paid to the Investment Manager; the
charges and expenses of any registrar, any custodian, sub-custodian or
depository appointed by the Fund for the safekeeping of the Sub-Advisory
Portfolio's cash, portfolio securities and other property, and any stock
transfer or dividend agent or agents appointed by the Fund; brokers' commissions
chargeable to the Sub-Advisory
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<PAGE>
Portfolio in connection with portfolio securities transactions to which the
Sub-Advisory Portfolio is a party; all taxes, including securities issuance and
transfer taxes, and fees payable by the Sub-Advisory Portfolio to federal, state
or other governmental agencies or pursuant to any foreign laws; the cost and
expense of engraving or printing certificates representing shares of the
Sub-Advisory Portfolio; all costs and expenses in connection with the
registration and maintenance of registration of the Sub-Advisory Portfolio and
its shares with the Securities and Exchange Commission and various states and
other jurisdictions or pursuant to any foreign laws (including filing fees and
legal fees and disbursements of counsel); the cost and expense of printing
(including typesetting) and distributing prospectuses of the Fund and
supplements thereto to the Sub-Advisory Portfolio's shareholders; all expenses
of shareholders' and Trustees' meetings and of preparing, printing and mailing
proxy statements and reports to shareholders; fees and travel expenses of
Trustees or members of any advisory board or committee who are not employees of
the Investment Manager or Sub-Adviser; all expenses incident to the payment of
any dividend, distribution, withdrawal or redemption whether in shares or in
cash; charges and expenses of any outside service used for pricing of the
Sub-Advisory Portfolio's shares; charges and expenses of legal counsel,
including counsel to the Trustees of the Fund who are not interested persons (as
defined in the Act) of the Fund, the Investment Manager or the Sub-Adviser, and
of independent accountants, in connection with any matter relating to the
Sub-Advisory Portfolio; membership dues of industry associations; interest
payable on Sub-Advisory Portfolio borrowings; postage; insurance premiums on
property or personnel (including officers and Trustees) of the Sub-Advisory
Portfolio which inure to its benefit; extraordinary expenses (including but not
limited to legal claims and liabilities and litigation costs and any
indemnification related thereto); and all other charges and costs of the
Sub-Advisory Portfolio's operation unless otherwise explicitly provided herein.
7. For the services to be rendered, the facilities furnished, and the
expenses assumed by the Sub-Adviser, the Investment Manager shall pay to the
Sub-Adviser monthly compensation equal to 40% of its monthly compensation
receivable pursuant to the Investment Management Agreement in respect of each of
the North American Government Securities Portfolio, the Balanced Portfolio, the
Core Equity Portfolio and the Emerging Markets Portfolio. Any subsequent change
in the Investment Management Agreement which has the effect of raising or
lowering the compensation of the Investment Manager will have the concomitant
effect of raising or lowering the fees payable to the Sub-Adviser under this
Agreement. In addition, if the Investment Manager has undertaken in the Fund's
Registration Statement as filed under the Act or elsewhere to waive all or part
of its fees under the Investment Management Agreement, the Sub-Adviser's fees
payable under this Agreement will be proportionately waived in whole or in part.
The calculation of the fees payable to the Sub-Adviser pursuant to this
Agreement will be made, each month, at the time designated for the monthly
calculation of the fees payable to the Investment Manager pursuant to the
Investment Management Agreement. If this Agreement becomes effective subsequent
to the first day of a month or shall terminate before the last day of a month,
compensation for the part of the month this Agreement is in effect shall be
prorated in a manner consistent with the calculation of the fees as set forth
above. Subject to the provisions of paragraph 8 hereof, payment of the
Sub-Adviser's compensation for the preceding month shall be made as promptly as
possible after completion of the computations contemplated by paragraph 8
hereof.
8. In the event the operating expenses of any of the North American
Government Securities Portfolio, the Balanced Portfolio, the Core Equity
Portfolio or the Emerging Markets Portfolio, including amounts payable to the
Investment Manager pursuant to the Investment Management Agreement in respect of
any of these Sub-Advisory Portfolios, for any fiscal year ending on a date on
which this Agreement is in effect, exceed 2.5% of the average daily net assets
of the Sub-Advisory Portfolio up to $30 million, 2.0% of the next $70 million
and 1.5% of the average daily net assets of the Sub-Advisory Portfolio in excess
of $100 million (the "expense limitation"), the Sub-Adviser shall reduce its
advisory fee to the extent of 40% of such excess and will reimburse the
Investment Manager for annual operating expenses in the amount of 40% of such
excess of the expense limitation, up to the
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<PAGE>
amount of the Sub-Adviser's fee which would otherwise be payable under this
Agreement for that year, it being understood that the Investment Manager has
agreed to effect a reduction and reimbursement of 100% of such excess, up to the
amount of its management fee in respect of the Sub-Advisory Portfolio which
otherwise would be payable for that year, in accordance with the terms of the
Investment Management Agreement; provided, however, there shall be excluded from
such expenses the amount of any interest, taxes, brokerage commissions, and
extraordinary expenses (including but not limited to legal claims and
liabilities and litigation costs and any indemnification related thereto) paid
or payable by the Sub-Advisory Portfolio. Such reduction, if any, shall be
computed and accrued daily, shall be settled on a monthly basis, and shall be
based upon the expense limitation applicable to the Sub-Advisory Portfolio as at
the end of the last business day of the month.
9. The Sub-Adviser will use its best efforts in the performance of
investment activities on behalf of the Sub-Advisory Portfolios, but in the
absence of willful misfeasance, bad faith, gross negligence or reckless
disregard of its obligations hereunder, the Sub-Adviser shall not be liable to
the Investment Manager or the Fund or any of its investors for any error of
judgment or mistake of law or for any act or omission by the Sub-Adviser or for
any losses sustained by the Sub-Advisory Portfolios or their investors.
10. It is understood that any of the shareholders, Trustees, officers and
employees of the Fund may be a shareholder, director, officer or employee of, or
be otherwise interested in, the Sub-Adviser, and in any person controlled by or
under common control or affiliated with the Sub-Adviser, and that the
Sub-Adviser and any person controlled by or under common control or affiliated
with the Sub-Adviser may have an interest in the Fund. It is also understood
that the Sub-Adviser and any affiliated persons thereof or any persons
controlled by or under common control with the Sub-Adviser have and may have
advisory, management service or other contracts with other organizations and
persons, and may have other interests and businesses, and further may purchase,
sell or trade any securities or commodities for their own accounts or for the
account of others for whom they may be acting. Nothing contained in this
Agreement shall limit or restrict the Sub-Adviser or any affiliated person
thereof from so acting or engaging in any other business.
11. This Agreement shall remain in effect until April 30, 1999 and from year
to year thereafter with respect to each Sub-Advisory Portfolio provided such
continuance with respect to a Sub-Advisory Portfolio is approved at least
annually by the vote of holders of a majority, as defined in the Act, of the
outstanding voting securities of the Sub-Advisory Portfolio or by the Trustees
of the Fund; provided, that in either event such continuance is also approved
annually by the vote of a majority of the Trustees of the Fund who are not
parties to this Agreement or "interested persons" (as defined in the Act) of any
such party, which vote must be cast in person at a meeting called for the
purpose of voting on such approval; provided, however, that (a) the Fund may, at
any time and without the payment of any penalty, terminate this Agreement upon
thirty days' written notice to the Investment Manager and the Sub-Adviser,
either by majority vote of the Trustees of the Fund or, with respect to a Sub-
Advisory Portfolio, by the vote of a majority of the outstanding voting
securities of such Sub-Advisory Portfolio; (b) this Agreement shall immediately
terminate in the event of its assignment (within the meaning of the Act) unless
such automatic termination shall be prevented by an exemptive order of the
Securities and Exchange Commission; (c) this Agreement shall immediately
terminate in the event of the termination of the Investment Management
Agreement; (d) the Investment Manager may terminate this Agreement without
payment of penalty on thirty days' written notice to the Fund and the
Sub-Adviser; and (e) the Sub-Adviser may terminate this Agreement without the
payment of penalty on thirty days' written notice to the Fund and the Investment
Manager. Any notice under this Agreement shall be given in writing, addressed
and delivered, or mailed post-paid, to the other party at the principal office
of such party.
12. This Agreement may be amended by the parties without the vote or consent
of the shareholders of any Sub-Advisory Portfolio to supply any omission, to
cure, correct or supplement any ambiguous, defective or
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<PAGE>
inconsistent provision hereof, or if they deem it necessary to conform this
Agreement to the requirements of applicable federal laws or regulations, but
neither the Fund, the Investment Manager nor the Sub-Adviser shall be liable for
failing to do so.
13. This Agreement shall be construed in accordance with the law of the
State of New York and the applicable provisions of the Act. To the extent the
applicable law of the State of New York, or any of the provisions herein,
conflicts with the applicable provisions of the Act, the latter shall control.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the day and year first above written in New York, New York.
DEAN WITTER INTERCAPITAL INC.
By
--------------------------------------
Attest:
--------------------------------------
TCW FUNDS MANAGEMENT, INC.
By
--------------------------------------
By
--------------------------------------
Attest:
--------------------------------------
Accepted and agreed to as of
the day and year first above written:
DEAN WITTER SELECT DIMENSIONS
INVESTMENT SERIES
By
- --------------------------------------
Attest:
- --------------------------------------
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<PAGE>
APPENDIX D
FORM OF NEW SECONDARY SUB-ADVISORY AGREEMENT
AGREEMENT made as of the [ ] day of [ ], 1997, by and between TCW
Funds Management, Inc., a California corporation ("FMI"), and TCW Asia Limited,
a Hong Kong corporation ("TCW Asia").
WHEREAS, FMI has entered into a Sub-Advisory Agreement with Dean Witter
InterCapital Inc. ("InterCapital") to provide investment advisory services for
the Emerging Markets Portfolio and any subsequently established Portfolio
("Portfolio(s)") of Dean Witter Select Dimensions Investment Series (the
"Fund");
WHEREAS, TCW Asia is registered as an investment adviser under the
Investment Advisers Act of 1940, and engages in the business of acting as an
investment adviser;
WHEREAS, FMI desires to retain the services of TCW Asia to render investment
advisory services for the Portfolio in the manner and on the terms and
conditions hereinafter set forth;
WHEREAS, TCW Asia desires to be retained by FMI to provide such investment
advisory services on said terms and conditions;
NOW, THEREFORE; in consideration of the foregoing recitals and the mutual
covenants and agreements contained herein, the parties agree as follows:
1. Subject to the supervision of FMI, and in accordance with the investment
objective, policies and restrictions set forth in the then current Registration
Statement, which is hereby incorporated by reference, relating to the Fund which
Registration Statement contains a recital of risk factors, and such investment
objective, policies and restrictions from time to time prescribed by the
Trustees of the Fund and communicated by FMI in writing to TCW Asia, TCW Asia
agrees to provide the Portfolio with investment advisory services including, but
not limited to, obtaining and evaluating such information and advice relating to
the economy, securities and commodities markets and securities and commodities
and shall manage the assets of the Portfolio in a manner consistent with the
investment objective and policies of such Portfolio and shall determine the
securities and commodities to be purchased, acquired, sold or otherwise disposed
of by the Portfolio and the timing of such purchases, acquisitions, sales or
dispositions. TCW Asia agrees to furnish to or place at the disposal of FMI the
information, evaluations, analyses and opinions formulated or obtained by it in
performing its advisory services under this Agreement. FMI and TCW Asia agree to
make their offices and employees available to the other from time to time at
reasonable times to review investment policies of the Portfolio and to consult
with each other. Nothing in this Agreement shall require FMI to utilize the
services of TCW Asia with respect to any specific or minimum percentage of the
assets of the Portfolio.
In the event the Fund establishes another portfolio other than the current
Portfolio with respect to which FMI desires to retain TCW Asia to render
investment advisory services hereunder, FMI shall notify TCW Asia in writing. If
TCW Asia is willing to render such services, it shall notify FMI in writing,
whereupon such other portfolio shall be deemed a Portfolio hereunder.
2. TCW Asia shall, at its own expense, maintain such staff and employ or
retain such personnel and consult with such other persons as it shall from time
to time determine to be necessary or useful to the performance of its
obligations under this Agreement. Without limiting the generality of the
foregoing, the staff and personnel of TCW Asia shall be deemed to include
persons employed or otherwise retained by TCW Asia to furnish statistical and
other factual data, advice regarding economic factors and trends, information,
advice and assistance as FMI may desire. TCW Asia shall maintain whatever
records as may be required to be maintained by it under the
D-1
<PAGE>
Investment Company Act of 1940, as amended (the "Act"), or the Investment
Advisers Act of 1940. All such records so maintained shall be made available to
FMI and the Fund, upon the request of FMI or the Fund. TCW Asia shall provide
all account statements and performance or financial records as required by
United States securities laws. TCW Asia acknowledges that cash balances and
other assets of the Fund will be held by Custodian bank(s) designated by the
Fund.
3. FMI will, from time to time, furnish or otherwise make available to TCW
Asia such financial reports, proxy statements and other information provided it
by the Fund, including investment policies and restrictions from time to time
prescribed by the Trustees of the Fund, relating to the business and affairs of
the Portfolios as TCW Asia may reasonably require in order to discharge its
duties and obligations hereunder or to comply with any applicable law and
regulations. All instructions given by FMI to TCW Asia shall be in writing and
sent to TCW Asia's principal office and shall take effect upon actual receipt by
TCW Asia.
4. For the services to be rendered, FMI, at its own expense, shall pay TCW
Asia monthly compensation, determined by applying the annual rate of 0.50% to
the Fund's average daily net assets for which TCW Asia renders sub-advisory
services. For the purpose of calculating such fee, the net asset value for a
month shall be the average of the net asset values for which TCW Asia provides
sub-advisory services as determined for each business day of the month. If this
Agreement becomes effective after the first day of a month, or terminates before
the last day of a month, the foregoing compensation shall be prorated.
In the event that the aggregate compensation received by FMI from the Fund
for any month is less than that specified above, the compensation payable by FMI
to TCW Asia shall be equal to that received by FMI. The compensation of TCW Asia
is a responsibility of FMI and not a responsibility of the Fund.
5. TCW Asia will use its best efforts in the performance of investment
activities on behalf of the Portfolios, but in the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations hereunder, TCW Asia shall not be liable to InterCapital, FMI or the
Fund or any of its investors for any error of judgment or mistake of law or for
any act or omission by TCW Asia or for any losses sustained by the Portfolios or
their investors.
6. It is understood that any of the shareholders, Trustees, officers and
employees of the Fund may be a shareholder, director, officer or employee of, or
be otherwise interested in, TCW Asia and in any person controlled by or under
common control or affiliated with TCW Asia and that TCW Asia and any person
controlled by or under common control or affiliated with TCW Asia may have an
interest in the Fund. It is also understood that TCW Asia and any affiliated
persons thereof or any persons controlled by or under common control with TCW
Asia have and may have advisory, management service or other contracts with
other organizations and persons, and may have other interests and businesses,
and further may purchase, sell or trade any securities or commodities for their
own accounts or for the account of others for whom they may be acting. Nothing
contained in this Agreement shall limit or restrict TCW Asia or any affiliated
person thereof from so acting or engaging in any other business.
7. This Agreement shall remain in effect until April 30, 1999 and from year
to year thereafter with respect to each Portfolio provided such continuance with
respect to a Portfolio is approved at least annually by the vote of holders of a
majority, as defined in the Act, of the outstanding voting securities of the
Portfolio or by the Trustees of the Fund; provided, that in either event such
continuance is also approved annually by the vote of a majority of the Trustees
of the Fund who are not parties to this Agreement or "interested persons" (as
defined in the Act) of any such party, which vote must be cast in person at a
meeting called for the purpose of voting on such approval; provided, however,
that (a) the Fund may at any time and without the payment of any penalty,
terminate this Agreement upon thirty days' written notice to FMI and TCW Asia,
either by majority vote of the Trustees of the
D-2
<PAGE>
Fund or, with respect to a Portfolio, by the vote of a majority of the
outstanding voting securities of such Portfolio; (b) this Agreement shall
immediately terminate in the event of its assignment, as defined in the Act,
unless automatic termination shall be prevented by an exemptive order of the
Securities and Exchange Commission; (c) this Agreement shall immediately
terminate in the event of the termination of the Sub-Advisory Agreement; (d) FMI
may terminate this Agreement without payment of penalty on thirty days' written
notice to TCW Asia and the Fund; and (e) TCW Asia may terminate this Agreement
without the payment of penalty on thirty days' written notice to FMI and the
Fund. Any notice under this Agreement shall be given in writing, addressed and
delivered, or mailed postage paid, to the other party at its principal business
office.
8. This Agreement may be amended by the parties without the vote or consent
of the shareholders of any Portfolio to supply any omission, to cure, correct or
supplement any ambiguous, defective or inconsistent provision hereof, or if they
deem it necessary to conform this Agreement to the requirements of applicable
federal laws or regulations, but neither the Fund, InterCapital, FMI nor TCW
Asia shall be liable for failing to do so.
9. This Agreement shall be construed in accordance with the law of the
State of California and the applicable provisions of the Act. To the extent the
applicable law of the State of California, or any of the provisions herein,
conflicts with the applicable provisions of the Act, the latter shall control.
10. The effective date of this Agreement shall be the day and year first
written above.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the day and year first above written in Los Angeles, California.
TCW FUNDS MANAGEMENT, INC.
By:
--------------------------------------
Name:
--------------------------------------
Title:
--------------------------------------
Attest:
--------------------------------------
Name:
--------------------------------------
Title:
--------------------------------------
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<PAGE>
TCW ASIA LIMITED
By:
--------------------------------------
Name:
--------------------------------------
Title:
--------------------------------------
Attest:
--------------------------------------
Name:
--------------------------------------
Title:
--------------------------------------
D-4
<PAGE>
APPENDIX E
FORM OF NEW SECONDARY SUB-ADVISORY AGREEMENT
AGREEMENT made as of the [ ] day of [ ], 1997, by and between TCW
Funds Management, Inc., a California corporation ("FMI"), and TCW London
International, Limited, a California corporation ("TCW London").
WHEREAS, FMI has entered into a Sub-Advisory Agreement with Dean Witter
InterCapital Inc. ("InterCapital") to provide investment advisory services for
the Emerging Markets Portfolio and any subsequently established Portfolio
("Portfolio(s)") of Dean Witter Select Dimensions Investment Series (the
"Fund");
WHEREAS, TCW London is registered as an investment adviser under the
Investment Advisers Act of 1940, and engages in the business of acting as an
investment adviser;
WHEREAS, TCW London is a member of the Investment Management Regulatory
Organization Limited ("IMRO") and as such is regulated by IMRO in the conduct of
its investment business and nothing in this Agreement shall exclude any
liability of TCW London to the Fund under the Financial Services Act of 1986 or
the IMRO Rules;
WHEREAS, FMI desires to retain the services of TCW London to render
investment advisory services for the Portfolio in the manner and on the terms
and conditions hereinafter set forth;
WHEREAS, TCW London desires to be retained by FMI to provide such investment
advisory services on said terms and conditions;
NOW, THEREFORE; in consideration of the foregoing recitals and the mutual
covenants and agreements contained herein, the parties agree as follows:
1. Subject to the supervision of FMI, and in accordance with the investment
objective, policies and restrictions set forth in the then current Registration
Statement, which is hereby incorporated by reference, relating to the Fund which
Registration Statement contains a recital of risk factors, and such investment
objective, policies and restrictions from time to time prescribed by the
Trustees of the Fund and communicated by FMI in writing to TCW London, TCW
London agrees to provide the Portfolio with investment advisory services
including, but not limited to, obtaining and evaluating such information and
advice relating to the economy, securities and commodities markets and
securities and commodities and shall manage the assets of the Portfolio in a
manner consistent with the investment objective and policies of such Portfolio
and shall determine the securities and commodities to be purchased, acquired,
sold or otherwise disposed of by the Portfolio and the timing of such purchases,
acquisitions, sales or dispositions. TCW London agrees to furnish to or place at
the disposal of FMI the information, evaluations, analyses and opinions
formulated or obtained by it in performing its advisory services under this
Agreement. FMI and TCW London agree to make their offices and employees
available to the other from time to time at reasonable times to review
investment policies of the Portfolio and to consult with each other. Nothing in
this Agreement shall require FMI to utilize the services of TCW London with
respect to any specific or minimum percentage of the assets of the Portfolio.
In the event the Fund establishes another portfolio other than the current
Portfolio with respect to which FMI desires to retain TCW London to render
investment advisory services hereunder, FMI shall notify TCW London in writing.
If TCW London is willing to render such services, it shall notify FMI in
writing, whereupon such other portfolio shall be deemed a Portfolio hereunder.
E-1
<PAGE>
2. TCW London shall, at its own expense, maintain such staff and employ or
retain such personnel and consult with such other persons as it shall from time
to time determine to be necessary or useful to the performance of its
obligations under this Agreement. Without limiting the generality of the
foregoing, the staff and personnel of TCW London shall be deemed to include
persons employed or otherwise retained by TCW London to furnish statistical and
other factual data, advice regarding economic factors and trends, information,
advice and assistance as FMI may desire. TCW London shall maintain whatever
records as may be required to be maintained by it under the Investment Company
Act of 1940, as amended (the "Act"), or the Investment Advisers Act of 1940. All
such records so maintained shall be made available to FMI and the Fund, upon the
request of FMI or the Fund. TCW London shall provide all account statements and
performance or financial records as required by United States securities laws.
TCW London acknowledges that cash balances and other assets of the Fund will be
held by Custodian bank(s) designated by the Fund.
3. FMI will, from time to time, furnish or otherwise make available to TCW
London such financial reports, proxy statements and other information provided
it by the Fund, including investment policies and restrictions from time to time
prescribed by the Trustees of the Fund, relating to the business and affairs of
the Portfolios as TCW London may reasonably require in order to discharge its
duties and obligations hereunder or to comply with any applicable law and
regulations. All instructions given by FMI to TCW London shall be in writing and
sent to TCW London's principal office and shall take effect upon actual receipt
by TCW London.
4. For the services to be rendered, FMI, at its own expense, shall pay TCW
London monthly compensation, determined by applying the annual rate of 0.50% to
the Fund's average daily net assets for which TCW London renders sub-advisory
services. For the purpose of calculating such fee, the net asset value for a
month shall be the average of the net asset values for which TCW London provides
sub-advisory services as determined for each business day of the month. If this
Agreement becomes effective after the first day of a month, or terminates before
the last day of a month, the foregoing compensation shall be prorated.
In the event that the aggregate compensation received by FMI from the Fund
for any month is less than that specified above, the compensation payable by FMI
to TCW London shall be equal to that received by FMI. The compensation of TCW
London is a responsibility of FMI and not a responsibility of the Fund.
5. TCW London will use its best efforts in the performance of investment
activities on behalf of the Portfolios, but in the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations hereunder, TCW London shall not be liable to InterCapital, FMI or
the Fund or any of its investors for any error of judgment or mistake of law or
for any act or omission by TCW London or for any losses sustained by the
Portfolios or their investors.
6. It is understood that any of the shareholders, Trustees, officers and
employees of the Fund may be a shareholder, director, officer or employee of, or
be otherwise interested in, TCW London and in any person controlled by or under
common control or affiliated with TCW London and that TCW London and any person
controlled by or under common control or affiliated with TCW London may have an
interest in the Fund. It is also understood that TCW London and any affiliated
persons thereof or any persons controlled by or under common control with TCW
London have and may have advisory, management service or other contracts with
other organizations and persons, and may have other interests and businesses,
and further may purchase, sell or trade any securities or commodities for their
own accounts or for the account of others for whom they may be acting. Nothing
contained in this Agreement shall limit or restrict TCW London or any affiliated
person thereof from so acting or engaging in any other business.
7. This Agreement shall remain in effect until April 30, 1999 and from year
to year thereafter with respect to each Portfolio provided such continuance with
respect to a Portfolio is approved at least annually by the vote of
E-2
<PAGE>
holders of a majority, as defined in the Act, of the outstanding voting
securities of the Portfolio or by the Trustees of the Fund; provided, that in
either event such continuance is also approved annually by the vote of a
majority of the Trustees of the Fund who are not parties to this Agreement or
"interested persons" (as defined in the Act) of any such party, which vote must
be cast in person at a meeting called for the purpose of voting on such
approval; provided, however, that (a) the Fund may at any time and without the
payment of any penalty, terminate this Agreement upon thirty days' written
notice to FMI and TCW London, either by majority vote of the Trustees of the
Fund or, with respect to a Portfolio, by the vote of a majority of the
outstanding voting securities of such Portfolio; (b) this Agreement shall
immediately terminate in the event of its assignment, as defined in the Act,
unless automatic termination shall be prevented by an exemptive order of the
Securities and Exchange Commission; (c) this Agreement shall immediately
terminate in the event of the termination of the Sub-Advisory Agreement; (d) FMI
may terminate this Agreement without payment of penalty on thirty days' written
notice to TCW London and the Fund; and (e) TCW London may terminate this
Agreement without the payment of penalty on thirty days' written notice to FMI
and the Fund. Any notice under this Agreement shall be given in writing,
addressed and delivered, or mailed postage paid, to the other party at its
principal business office.
8. This Agreement may be amended by the parties without the vote or consent
of the shareholders of any Portfolio to supply any omission, to cure, correct or
supplement any ambiguous, defective or inconsistent provision hereof, or if they
deem it necessary to conform this Agreement to the requirements of applicable
federal laws or regulations, but neither the Fund, InterCapital, FMI nor TCW
London shall be liable for failing to do so.
9. All formal complaints should, in the first instance, be made in writing
to TCW London's compliance officer at TCW London's principal office. In
addition, FMI and/or the Fund shall have a right to complain directly to IMRO.
10. A statement is available from TCW London describing FMI's and/or the
Fund's rights to compensation, if any, in the event that TCW London is unable to
meet its liabilities.
11. FMI acknowledges that for purposes of the IMRO rules, it will be treated
as a non-private customer.
12. This Agreement shall be construed in accordance with the law of the
State of California and the applicable provisions of the Act. To the extent the
applicable law of the State of California, or any of the provisions herein,
conflicts with the applicable provisions of the Act, the latter shall control.
13. The effective date of this Agreement shall be the day and year first
written above.
E-3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the day and year first above written in Los Angeles, California.
TCW FUNDS MANAGEMENT, INC.
By:
--------------------------------------
Name:
--------------------------------------
Title:
--------------------------------------
Attest:
--------------------------------------
Name:
--------------------------------------
Title:
--------------------------------------
TCW LONDON INTERNATIONAL LIMITED
By:
--------------------------------------
Name:
--------------------------------------
Title:
--------------------------------------
Attest:
--------------------------------------
Name:
--------------------------------------
Title:
--------------------------------------
E-4
<PAGE>
APPENDIX F
TCW Funds Management Inc. serves as sub-adviser to the North American
Government Securities Portfolio of the Fund as well as investment adviser or
sub-adviser to the other investment companies listed below which have similar
investment objectives to that of the North American Government Securities
Portfolio. Set forth below is a chart showing the net assets of each such
investment company as of March 12, 1997 and the investment advisory or
sub-advisory fee rate(s) applicable to such investment company.
<TABLE>
<CAPTION>
CURRENT INVESTMENT
NET ASSETS ADVISORY OR
AS OF SUB-ADVISORY FEE RATE(S) AS
03/12/97 A PERCENTAGE OF NET ASSETS
------------- ---------------------------------------
<C> <S> <C> <C>
1. DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES:
NORTH AMERICAN GOVERNMENT
SECURITIES PORTFOLIO..................................... $ 4,484,769 0.26%
2. TCW/DW NORTH AMERICAN GOVERNMENT INCOME TRUST............ $ 281,970,281 0.26% on assets up to $3 billion and
0.24% on assets over $3 billion
</TABLE>
TCW Funds Management Inc. serves as sub-adviser to the Balanced Portfolio of
the Fund as well as investment adviser or sub-adviser to the other investment
companies listed below which have similar investment objectives to that of the
Balanced Portfolio. Set forth below is a chart showing the net assets of each
such investment company as of March 12, 1997 and the investment advisory or
sub-advisory fee rate(s) applicable to such investment company.
<TABLE>
<CAPTION>
CURRENT INVESTMENT
NET ASSETS ADVISORY OR
AS OF SUB-ADVISORY FEE RATE(S) AS
03/12/97 A PERCENTAGE OF NET ASSETS
------------- ---------------------------------------
<C> <S> <C> <C>
1. DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES:
BALANCED PORTFOLIO....................................... $ 46,432,529 0.30%
2. TCW/DW BALANCED FUND..................................... $ 92,741,090 0.30%
3. ENDEAVOR SERIES TRUST MANAGED ASSET ALLOCATION
PORTFOLIO................................................ $ 253,939,811 0.375%
</TABLE>
TCW Funds Management Inc. serves as sub-adviser to the Core Equity Portfolio
of the Fund as well as investment adviser or sub-adviser to the other investment
companies listed below which have similar investment objectives to that of the
Core Equity Portfolio. Set forth below is a chart showing the net assets of each
such investment company as of March 12, 1997 and the investment advisory or
sub-advisory fee rate(s) applicable to such investment company.
<TABLE>
<CAPTION>
CURRENT INVESTMENT
NET ASSETS ADVISORY OR
AS OF SUB-ADVISORY FEE RATE(S) AS
03/12/97 A PERCENTAGE OF NET ASSETS
------------- ---------------------------------------
<C> <S> <C> <C>
1. DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES:
CORE EQUITY PORTFOLIO.................................... $ 22,871,602 0.34%
2. TCW/DW CORE EQUITY TRUST................................. $ 793,388,177 0.34% on assets up to $750 million,
scaled down at various asset levels to
0.30% on assets over $1.5 billion
3. TCW GALILEO CORE EQUITY FUND............................. $ 224,569,969 0.75%
</TABLE>
F-1
<PAGE>
TCW Funds Management Inc. serves as sub-adviser to the Emerging Markets
Portfolio of the Fund as well as investment adviser or sub-adviser to the other
investment companies listed below which have similar investment objectives to
that of the Emerging Markets Portfolio. Set forth below is a chart showing the
net assets of each such investment company as of March 12, 1997 and the
investment advisory or sub-advisory fee rate(s) applicable to such investment
company.
<TABLE>
<CAPTION>
CURRENT INVESTMENT
NET ASSETS ADVISORY OR
AS OF SUB-ADVISORY FEE RATE(S) AS
03/12/97 A PERCENTAGE OF NET ASSETS
------------- ---------------------------------------
<C> <S> <C> <C>
1. DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES:
EMERGING MARKETS PORTFOLIO................................ $ 21,698,779 0.50%
2. TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST............... $ 316,155,009 0.50%
3. TCW GALILEO FUNDS, INC.
(A) TCW GALILEO ASIA PACIFIC EQUITY
FUND................................................... $ 49,648,598 1.00%
(B) TCW GALILEO EMERGING MARKETS
FUND................................................... $ 68,499,293 1.00%
(C) TCW GALILEO LATIN AMERICA FUND........................ $ 80,3998,963 1.00%
4. TCW/DW LATIN AMERICAN GROWTH FUND......................... $ 293,410,163 0.50% on assets up to $500 million and
0.48% on assets over $500 million
</TABLE>
TCW Asia Limited serves as secondary sub-adviser to the Emerging Markets
Portfolio of the Fund as well as sub-adviser to the other investment companies
listed below which have similar investment objectives to that of the Emerging
Markets Portfolio. Set forth below is a chart showing the net assets of each
such investment company as of March 12, 1997 and the sub-advisory fee rate(s)
applicable to such investment company.
<TABLE>
<CAPTION>
NET ASSETS
AS OF CURRENT SUB-ADVISORY FEE RATE(S) AS
03/12/97 A PERCENTAGE OF NET ASSETS
------------- ------------------------------------------
<C> <S> <C> <C>
1. DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES:
EMERGING MARKETS PORTFOLIO............................. $ 21,698,779 0.50%
2. TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST............ $ 316,155,009 0.50%
3. TCW GALILEO FUNDS, INC.
(A) TCW GALILEO ASIA PACIFIC EQUITY
FUND................................................ $ 49,648,598 1.00%
(B) TCW GALILEO EMERGING MARKETS
FUND................................................ $ 68,499,293 1.00%
</TABLE>
TCW London International, Limited serves as secondary sub-adviser to the
Emerging Markets Portfolio of the Fund as well as sub-adviser to the other
investment companies listed below which have similar investment objectives to
that of the Emerging Markets Portfolio. Set forth below is a chart showing the
net assets of each such investment company as of March 12, 1997 and the
sub-advisory fee rate(s) applicable to such investment company.
<TABLE>
<CAPTION>
NET ASSETS
AS OF CURRENT SUB-ADVISORY FEE RATE(S) AS
03/12/97 A PERCENTAGE OF NET ASSETS
------------- ------------------------------------------
<C> <S> <C> <C>
1. DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES:
EMERGING MARKETS PORTFOLIO............................. $ 21,698,779 0.50%
2. TCW/DW EMERGING MARKETS OPPORTUNITIES TRUST............ $ 316,155,009 0.50%
3. TCW GALILEO EMERGING MARKETS FUND...................... $ 68,499,293 1.00%
</TABLE>
F-2
<PAGE>
ITT HARTFORD VOTING INSTRUCTION CARD
VOTING INSTRUCTIONS FOR THE SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 20, 1997
OF THE DEAN WITTER SELECT DIMENSIONS INVESTMENT SERIES.
This Instruction Card is solicited by the ITT Hartford Life Insurance
Companies ("ITT Hartford") from owners of variable annuity contracts and/or
variable life insurance policies issued by ITT Hartford who have specified
that a portion of their investment be allocated to this portfolio of the
Dean Witter Select Dimensions Investment Series.
The undersigned contract/policy owner hereby instructs that the votes
attributable to the undersigned's interest with respect to the
above-referenced Portfolio be cast as directed on the reverse side at the
Special Meeting of Shareholders of Dean Witter Select Dimensions Investment
Series on May 20, 1997 at 2:00 p.m., New York City time. The undersigned, by
completing this form, does hereby authorize ITT Hartford to exercise its
discretion in voting upon such other business as may properly come before the
Meeting.
Date: ___________________________________, 1997
PLEASE SIGN IN BOX BELOW
___________________________________________________
Signature(s) HART/OWSDIS
<PAGE>
THIS INSTRUCTION CARD, WHEN PROPERLY EXECUTED, WILL BE VOTED BY ITT HARTFORD
IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED. IF NO DIRECTION IS MADE,
THE VOTES ATTRIBUTABLE TO THIS INSTRUCTION CARD WILL BE VOTED FOR ALL
PROPOSALS LISTED BELOW. INTERESTS IN THE PORTFOLIO FOR WHICH NO INSTRUCTIONS
ARE RECEIVED WILL BE VOTED BY ITT HARTFORD IN THE SAME PROPORTION AS VOTES
FOR WHICH INSTRUCTIONS ARE RECEIVED FOR THE PORTFOLIO.
PLEASE VOTE BY FILLING IN THE APPROPRIATE BOX BELOW / / USING BLUE OR BLACK
INK OR DARK PENCIL.
1. FOR EACH PORTFOLIO. Approval of a New Investment Management Agreement with
Dean Witter InterCapital Inc. with respect to the Portfolio in connection
with the proposed merger.
FOR AGAINST ABSTAIN
/ / / / / /
2. FOR NORTH AMERICAN GOVERNMENT SECURITIES, BALANCED, CORE EQUITY AND
EMERGING MARKETS PORTFOLIOS ONLY. Approval of a New Subadvisory Agreement
between Dean Witter InterCapital Inc. and TCW Funds Management, Inc. ("TCW")
with respect to the Portfolio and, in the case of Emerging Markets Portfolio
only, approval of related New Secondary Sub-Advisory Agreements between
TCW and TCW Asia Limited and TCW London International, Limited, with respect
to the Portfolio.
FOR AGAINST ABSTAIN
/ / / / / /
3. FOR ALL PORTFOLIOS. Election of Trustees.
Michael Bozic, Charles A. Fiumefreddo, Edwin J. Garn, John R. Haire,
Wayne E. Hedien, Dr. Manuel H. Johnson, Michael E. Nugent,
Philip J. Purcell, John L. Schroeder
FOR WITHHOLD
/ / / /
TO WITHHOLD AUTHORITY TO VOTE FOR AN INDIVIDUAL NOMINEE, WRITE THAT
NOMINEE'S NAME BELOW.
________________________________________________________________________
4. FOR ALL PORTFOLIOS. Ratification of appointment of Price Waterhouse LLP as
Independent Accountants.
FOR AGAINST ABSTAIN
/ / / / / /
