<PAGE>
Bank Stock Portfolio Series 2
File No. 33-55217
Investment Company Act No. 811-5065
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 4
TO FORM S-6
For Registration Under the Securities Act of 1933 of Securities
of Unit Investment Trusts Registered on Form N-8B-2
A. Exact name of Trust:
MORGAN STANLEY DEAN WITTIER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
B. Name of Depositor:
DEAN WITTER REYNOLDS INC.
C. Complete address of Depositor's principal executive
office:
DEAN WITTER REYNOLDS INC.
Two World Trade Center
New York, New York 10048
D. Name and complete address of agent for service:
Mr. Michael D. Browne
Dean Witter Reynolds Inc.
Unit Trust Department
Two World Trade Center, 59th Floor
New York, New York 10048
Copy to:
Kenneth W. Orce, Esq.
Cahill Gordon & Reindel
80 Pine Street
New York, New York 10005
/x/ Check box if it is proposed that this filing should
become effective immediately upon filing pursuant to
paragraph(b) of Rule 485.
<PAGE>
MORGAN STANLEY DEAN WITTIER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
Cross Reference Sheet
Pursuant to Rule 404(c) of Regulation C
under the Securities Act of 1933
(Form N-8B-2 Items required by Instruction 1
as to Prospectus on Form S-6)
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
I. Organization and General Information
1. a. Name of Trust Front Cover
b. Title of securities
issued
2. Name and address of Deposi- Table of Contents
tor
3. Name and address of Trustee Table of Contents
4. Name and address of princi- Table of Contents
pal Underwriter
5. Organization of Trust Introduction
6. Execution and termination of Introduction;
Indenture Administration of the
Trust-Termination
7. Changes of name *30
8. Fiscal Year Included in Form N-8B-2
9. Litigation *30
II. General Description of the Trust
and Securities of the Trust
__________________
*30 Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
10. General Information regard-
ing Trust's Securities and
Rights of Holders
a. Type of Securities Rights of Unit Holders-Unit
(Registered or Bearer) Holders
b. Type of Securities Administration of the
(Cumulative or Dis- Trust-Distribution
tributive)
c. Rights of Holders as to Rights of Unit Holders-Unit
Withdrawal or Redemp- Holders; Redemption; Public
tion Offering of Units-Secondary
Market; Exchange Option
d. Rights of Holders as to Public Offering of Units-
conversion, transfer, Secondary Market; Exchange
partial redemption and Option; Redemption; Rights
similar matters of Unit Holders-Unit Hold-
ers
e. Lapses or defaults with *30
respect to periodic
payment plan certifi-
cates
f. Voting rights as to Se- Rights of Unit Holders-
curities under the In- Certain Limitations; Ad-
denture ministration of the Trust-
Amendment; -Termination
g. Notice to Holders as to Amendment and Termination
change in: of the Indenture
1. Assets of Trust Administration of the
Trust-Portfolio Supervi-
sion; The Trust-Summary De-
scription of the Portfolio
2. Terms and Condi- Administration of the
tions of Trust's Trust-Amendment
Securities
__________________
*30 Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
3. Provisions of Administration of the
Trust Trust-Amendment
4. Identity of De- Miscellaneous-Sponsor;
positor and Trus- -Trustee
tee
h. Consent of Security
Holders required to
change:
1. Composition of as- Administration of the
sets of Trust Trust-Amendment
2. Terms and condi- Administration of the
tions of Trust's Trust-Amendment
Securities
3. Provisions of In- Administration of the
denture Trust-Amendment
4. Identity of De- *30
positor and Trus-
tee
11. Type of securities compris- The Trust-Summary Descrip-
ing units tion of the Portfolio;
-Special Considerations;
-Objectives and Securities
Selection;
12. Type of securities compris-
ing periodic payment cer- *30 tificates
13. a. Load, fees, expenses, Summary of Essential Infor-
etc. mation; Public Offering of
Units-Public Offering
Price;-Volume Discount; Ex-
change Option; Expenses and
Charges
b. Certain information re- *30
garding periodic pay-
ment certificates
__________________
*30 Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
c. Certain percentages Summary of Essential Infor-
mation; Public Offering of
Units-Public Offering
Price;-Profit of Sponsor;-
Volume Discount; Exchange
Option
d. Price differentials Public Offering of Units-
Public Offering Price
e. Certain other loads, Rights of Unit Holders-Unit
fees, expenses, etc. Holders
payable by holders
f. Certain profits receiv- Public Offering of Units-
able by depositor, Profit of Sponsor
principal underwriters,
trustee or affiliated
persons
g. Ratio of annual charges *30
to income
14. Issuance of trust's securi- Introduction; Rights of
ties Unit Holders-Unit Holders
15. Receipt and handling of pay- Public Offering of Units-
ments from purchasers Profit of Sponsor
16. Acquisition and disposition Introduction; Administra-
of underlying securities tion of the Trust;
-Amendment; -Termination;
The Trust-Summary Descrip-
tion of the Portfolio;
-Objectives and Securities
Selection
17. Withdrawal or redemption Redemption; Public Offering
of Units-Secondary Market;
Exchange Option; Rights of
Unit Holders
18. a. Receipt and disposition Administration of the
of income Trust; Reinvestment Program
__________________
*30 Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
b. Reinvestment of distri-
butions Reinvestment Programs
c. Reserves or special Administration of the
fund Trust-Distribution
d. Schedule of distribu- *30
tion
19. Records, accounts and report Administration of the
Trust-Records and Accounts;
-Reports to Unit Holders
20. Certain miscellaneous provi- Administration of the
sions of the trust agreement Trust-Amendment; -
Termination; Resignation,
Removal and Liability-
Regarding the Trustee;
-Regarding the Sponsor
21. Loans to security holders *30
22. Limitations on liability of Resignation, Removal and
depositor, trustee, custo- Liability
dian, etc.
23. Bonding arrangements Included on Form N-8B-2
24. Other material provisions of *30
the trust agreement
III. Organization Personnel and
Affiliated Persons of Depositor
25. Organization of Depositor Miscellaneous-Sponsor
26. Fees received by Depositor Expenses and Charges-Fees;
Public Offering of Units-
Profit of Sponsor
27. Business of Depositor Miscellaneous-Sponsor; and
included in Form N-8B-2
__________________
*30 Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
28. Certain information as to Included in Form N-8B-2
officials and affiliated
persons of Depositor
29. Voting securities of Deposi- Included in Form N-8B-2
tor
30. Persons controlling Deposi- *30
tor
31. Compensation of Officers and *30
Directors of Depositor
32. Compensation of Directors of *30
Depositor
33. Compensation of employees of *30
Depositor
34. Remuneration of other per- *30
sons for certain services
rendered to trust
IV. Distribution and Redemption of Securities
35. Distribution of trust's se- Public Offering of Units-
curities by states Public Distribution
36. Suspension of sales of *30
trust's securities
37. Revocation of authority to *30
distribute
38. a. Method of distribution Public Offering of Units
b. Underwriting agreements
c. Selling agreements
39. a. Organization of princi- Miscellaneous-Sponsor
pal underwriter
b. N.A.S.D. membership of
principal underwriter
__________________
*30 Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
40. Certain fees received by Public Offering of Units-
principal underwriter Profit of Sponsor
41. a. Business of principal Miscellaneous-Sponsor
underwriter
b. Branch officers of *30
principal underwriter
c. Salesman of principal
underwriter *30
42. Ownership of trust's securi- *30
ties by certain persons
43. Certain brokerage commis- *30
sions received by principal
underwriter
44. a. Method of valuation Public Offering of Units
-Secondary Market; Redemp-
tion-Right of Redemption;
-Computation of Redemption
Value
b. Schedule as to offering *30
price
c. Variation in offering Public Offering of Units-
price to certain per- Volume Discount; Exchange
sons Option
45. Suspension of redemption *30
rights
46. a. Redemption valuation Public Offering of Units-
Secondary Market; Redemp-
tion-Right of Redemption;
-Computation of Redemption
Value
b. Schedule as to redemp- *30
tion price
__________________
*30 Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
47. Maintenance of position in See items 10(d), 44 and 46
underlying securities
V. Information concerning the Trustee or Custodian
48. Organization and regulation Miscellaneous-Trustee
of Trustee
49. Fees and expenses of Trustee Expenses and Charges
50. Trustee's lien Expenses and Charges
VI. Information concerning Insurance
of Holders of Securities
51. a. Name and address of In- *30
surance Company
b. Type of policies *30
c. Type of risks insured *30
and excluded
d. Coverage of policies *30
e. Beneficiaries of poli- *30
cies
f. Terms and manner of *30
cancellation
g. Method of determining *30
premiums
h. Amount of aggregate *30
premiums paid
i. Person receiving any *30
part of premiums
j. Other material provi- *30
sions of the Trust re-
lating to insurance
__________________
*30 Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
VII. Policy of Registrant
52. a. Method of selecting and Introduction; The Trust-
eliminating securities Objectives and Securities
from the Trust Selection; -Summary De-
scription of the Portfolio;
Administration of the
Trust-Portfolio Supervision
b. Elimination of securi- *30
ties from the Trust
c. Substitution and elimi- Introduction; The Trust-
nation of Securities Objectives and Securities
from the Trust Selection; -Summary De-
scription of the Portfolio;
Administration of the
Trust-Portfolio Supervi-
sion;
d. Description of any fun- *30
damental policy of the
Trust
53. a. Taxable status of the Tax Status of the Trust
Trust
53. b. Qualification of the *30
Trust as regulated in-
vestment company
VIII. Financial and Statistical Information
54. Information regarding the *30
Trust's past ten fiscal
years
55. Certain information regard- *30
ing periodic payment plan
certificates
__________________
*30 Not applicable, answer negative or not required.
<PAGE>
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
56. Certain information regard- *30
ing periodic payment plan
certificates
57. Certain information regard-
ing periodic payment plan
certificates *30
58. Certain information regard- *30
ing periodic payment plan
certificates
59. Financial statements Statement of Financial Con-
(Instruction 1(c) to dition
Form S-6)
__________________
*30 Not applicable, answer negative or not required.
<PAGE>
LOGO
MORGAN STANLEY DEAN WITTIER SELECT EQUITY TRUST
Bank Stock Portfolio Series 2
(A Unit Investment Trust)
This Trust was formed for the purpose of providing capital ap-
preciation and current income through investment in a fixed
portfolio consisting of publicly traded common stocks issued by
U.S. banks and bank holding companies. The value of the Units
of the Trust will fluctuate with the value of the Portfolio of
underlying Securities. Minimum Purchase: $1,000.
Sponsor: LOGO DEAN WITTER REYNOLDS INC.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
Read and retain this Prospectus for future reference.
Units of the Trust are not deposits or obligations of, or guar-
anteed or endorsed by, any bank, and the Units are not feder-
ally insured by the Federal Deposit Insurance Corporation, Fed-
eral Reserve Board, or any other agency.
Prospectus dated November 12, 1998
<PAGE>
THIS PROSPECTUS DOES NOT CONTAIN ALL OF THE INFORMATION WITH
RESPECT TO THE INVESTMENT COMPANY SET FORTH IN ITS REGISTRATION
STATEMENT AND EXHIBITS RELATING THERETO WHICH HAVE BEEN FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT
OF 1940, AND TO WHICH REFERENCE IS HEREBY MADE.
MORGAN STANLEY DEAN WITTIER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
TABLE OF CONTENTS
Page
Table of Contents........................................ A-1
Summary of Essential Information......................... A-3
Introduction............................................. 1
The Trust................................................ 4
Risk Factors - Special Considerations............... 4
Summary Description of the Portfolio................ 4
Objective and Securities Selection.................. 8
Distributions....................................... 9
Tax Status of the Trust.................................. 9
Public Offering of Units................................. 14
Public Offering Price............................... 14
Public Distribution................................. 15
Secondary Market.................................... 16
Profit of Sponsor................................... 16
Volume Discount..................................... 17
Exchange Option.......................................... 18
Reinvestment Program..................................... 20
Redemption............................................... 21
Right of Redemption................................. 21
Computation of Redemption Price..................... 23
Postponement of Redemption.......................... 24
Rights of Unit Holders................................... 24
Unit Holders........................................ 24
Certain Limitations................................. 25
Expenses and Charges..................................... 26
Fees................................................ 26
Other Charges....................................... 26
Administration of the Trust.............................. 27
Records and Accounts................................ 27
Distribution........................................ 28
Portfolio Supervision............................... 28
Voting of the Portfolio Securities.................. 30
Reports to Unit Holders............................. 30
Amendment........................................... 31
Termination......................................... 32
A-1
<PAGE>
Page
Resignation, Removal and Liability....................... 33
Regarding the Trustee............................... 33
Regarding the Sponsor............................... 34
Miscellaneous............................................ 35
Sponsor............................................. 35
Trustee............................................. 35
Legal Opinions...................................... 35
Auditors................................................. 36
Independent Auditor's Report............................. F-1
Sponsor:
Dean Witter Reynolds Inc.
2 World Trade Center
New York, New York 10048
Trustee:
The Bank of New York
101 Barclay Street
New York, New York 10286
1-800-545-7255
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS WITH RESPECT TO THIS INVESTMENT COMPANY NOT
CONTAINED IN THIS PROSPECTUS; AND ANY INFORMATION OR
REPRESENTATION NOT CONTAINED HEREIN MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER TO SELL, OR A SOLICITATION OF AN OFFER TO BUY, SECURITIES
IN ANY STATE TO ANY PERSON TO WHOM IT IS NOT LAWFUL TO MAKE
SUCH OFFER IN SUCH STATE.
A-2
<PAGE>
<TABLE>
<CAPTION>
SUMMARY OF ESSENTIAL INFORMATION
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
As of August 31, 1998
Number of Units 39,842,761++
Fractional Undivided Interest in Trust Represented by Each Unit 1/39,842,761th
Public Offering Price Per 1,000 Units:
Aggregate Value of Securities in the Trust $68,763,021
Divided by 39,842,761 Units (times 1,000) $ 1,725.86
Plus Sales Charge<F1> of 3.00% of Public Offering Price* (3.093% of net amount invested in Securities) 53.38
Public Offering Price per 1,000 Units 1,779.24
Plus amount per 1,000 Units of Overdistributed Principal and Net Investment Income (.48)
Total $1,778.76
Sponsor's Repurchase Price per 1,000 Units and Redemption Price per 1,000 Units (based on the value
of the underlying Securities, $53.38 less than the Public Offering Price per 1,000 Units plus
undistributed principal and net investment income) $ 1,725.38
<S> <S>
Evaluation Time Close of trading on the New York Stock Exchange.
(currently 4:00 PM New York time).
Record Dates Quarterly: March 1, June 1, September 1
and December 1 of each year.
Distribution Dates Quarterly: March 15, June 15, September 15 and
December 15 of each year.
Minimum Principal Distribution No distribution need be made from the Principal
Account if the balance therein is less than $1.00
per 1,000 Units outstanding.
In-kind Distribution Date February 1, 2000
Liquidation Period Not to exceed 10 business days after the In-Kind
Distribution Date.+
Mandatory Termination Date February 15, 2000
Discretionary Liquidation Amount The Trust may be terminated by the Sponsor if the
value of the portfolio of the Trust at any time is
less than $32,870,787 of the market value of the
Securities deposited in the Trust.+++
Trustee's Fee (including estimated expenses)**......... $1.00 per 1,000 Units.
Sponsor's Portfolio Supervision Fee** Maximum of $.25 per 1,000 Units.
<F1>Volume purchasers of Units are entitled to a reduced sales charge. See: "Public Offering of
Units - Volume Discount" in this Prospectus.
**See "Expenses and Charges" in this Prospectus. The fee accrues daily and is payable on each
Distribution Date. Estimated dividends from the Securities, based on the last dividends actually paid, are
expected by the Sponsor to be sufficient to pay the estimated expenses of the Trust.
+The final distribution will be made within 3 business days following the receipt of proceeds from the sale
of all Portfolio Securities. (See "Administration of Trust - Termination" in this Prospectus).
++The number of Units will be increased as the Sponsor deposits additional Securities into the Trust. (See
"Introduction" in this Prospectus.)
+++This figure will increase based on the Sponsor depositing securities into the Trust.
A-3
</TABLE>
<PAGE>
SUMMARY OF ESSENTIAL INFORMATION
(Continued)
THE TRUST -- The Morgan Stanley Dean Wittier Select
Equity Trust, Bank Stock Portfolio Series 2 (the "Trust") is a
unit investment trust composed of publicly traded common stocks
or contracts to purchase such stocks (the "Securities"). The
objectives of the Trust are to provide capital appreciation and
current income through an investment for approximately five
years from the initial Date of Deposit in a fixed portfolio
consisting of publicly traded common stocks issued by U.S.
banks and bank holding companies. The Securities may appreci-
ate or depreciate in value (or pay dividends) depending on the
full range of economic and market influences affecting corpo-
rate profitability, the financial condition of issuers, the
prices of equity securities in general and the Securities in
particular and with changes in both domestic and international
economic and political conditions. Therefore, there is no
guarantee that the objectives of the Trust will be achieved.
After the initial Date of Deposit, the Sponsor may, under the
Indenture and Agreement (as hereinafter defined), deposit addi-
tional Securities which may result in a corresponding increase
in the number of Units outstanding.
TERMINATION -- The Trust will terminate approximately
five years after the initial Date of Deposit regardless of mar-
ket conditions at that time. Prior to termination of the
Trust, the Trustee will begin to sell the Securities held in
the Trust over a period not to exceed 10 consecutive business
days (the "Liquidation Period"). Monies received upon such
sale of Securities will be held uninvested in non-interest
bearing accounts created by the Indenture until distributed pro
rata to Unit Holders on or about February 15, 2000 and will be
of benefit to the Trustee during such period. During the life
of the Trust, Securities will not be disposed of solely as a
result of normal fluctuations in market value. Because the
Trust is not managed and the Securities can only be sold during
the Liquidation Period or under certain other limited circum-
stances described herein, the proceeds received from the sale
of Securities may be less than could be obtained if the sale
had taken place at a different time. Depending on the volume
of Securities sold and the prices of and demand for Securities
at the time of such sale, the sales of Securities from the
Trust may tend to depress the market prices of such Securities
and hence the value of the Units, thus reducing termination
proceeds available to Unit Holders. In order to mitigate po-
tential adverse price consequences of heavy volume trading in
the Securities taking place over a short period of time and to
provide an average market price for the Securities, the Trustee
will follow procedures set forth in the Indenture to sell the
Securities in an orderly fashion over a period not to exceed
A-4
<PAGE>
SUMMARY OF ESSENTIAL INFORMATION
(Continued)
the Liquidation Period. The Sponsor can give no assurance,
however, that such procedures will mitigate negative price con-
sequences or provide a better price for such Securities. The
Trust may terminate earlier than on the Mandatory Termination
Date if the value of the Trust is less than the Discretionary
Liquidation Amount set forth herein. (See: "Administration of
the Trust -- Termination".)
DISTRIBUTIONS -- The Trustee will distribute any
dividends and any proceeds from the disposition of Securities
not used for redemption of Units or purchase of substitute se-
curities received by the Trust on each Distribution Date to
holders of record on the next preceding Record Date. Upon ter-
mination of the Trust, the Trustee will distribute to each Unit
Holder of record his pro rata share of the Trust's assets, less
expenses. The sale of Securities in the Trust in the period
prior to termination and upon termination may result in a lower
amount than might otherwise be realized if such sale were not
required at such time due to impending or actual termination of
the Trust. For this reason, among others, the amount realized
by a Unit Holder upon termination may be less than the amount
paid by such Unit Holder. (See: "Administration of the Trust
- -- Distribution".)
The Sponsor anticipates that, based upon the last
dividends actually paid by the companies listed in the
"Schedule of Portfolio Securities", dividends from the Securi-
ties will be sufficient (i) to pay expenses of the Trust and
(ii) after such payment, to make distributions to Unit Holders
as described herein. (See: "Expenses and Charges" and
"Administration of the Trust -- Distribution".)
PUBLIC OFFERING PRICE -- The Public Offering Price
per Unit is computed on the basis of the aggregate evaluation
of the underlying Securities next computed after receipt of a
purchase order plus cash on hand in the Trust, divided by the
number of Units outstanding, plus a sales charge of 4.439% of
such evaluation per Unit (the net amount invested); this re-
sults in a sales charge of 4.25% of the Public Offering Price.
The sales charge of 4.25% will decline over the life of the
Trust in the manner described below. On September 28, 1997,
the sales charge will decline to 3.00% (3.093% of the net
amount invested); on September 28, 1998, it will decline to
2.50% (2.564% of the net amount invested); and on September 28,
1999 it will decline to 1.50% (1.533% of the net amount in-
vested). The sales charge is reduced on a graduated scale for
sales involving at least $750,000. (See: "Public Offering of
Units -- Volume Discount".)
A-5
<PAGE>
SUMMARY OF ESSENTIAL INFORMATION
(Continued)
MARKET FOR UNITS -- The Sponsor, though not obligated
to do so, intends to maintain a market for the Units. If such
market is not maintained, a Unit Holder will be able to dispose
of its Units through redemption at prices based on the aggre-
gate market value of the underlying Securities. (See:
"Redemption".) Market conditions may cause such prices to be
greater or less than the amount paid for Units.
RISK FACTORS - SPECIAL CONSIDERATIONS -- An invest-
ment in Units of the Trust should be made with an understanding
of the risks inherent in an investment in common stocks, in-
cluding risks associated with the limited rights of holders of
equity securities to receive payments from issuers; such rights
are inferior to those of creditors and holders of debt obliga-
tions. Holders of common stock have the right to receive divi-
dends only when, as and if such dividends are declared by the
issuer's board of directors. Holders of preferred stocks have
the right to receive dividends at a fixed rate when and as de-
clared by the issuer's board of directors, normally on a cumu-
lative basis, but do not ordinarily participate in other
amounts available for distribution by the issuing corporation.
Investors should also be aware that the value of the underlying
Securities in the Portfolio may fluctuate in accordance with
changes in the value of common stocks generally, changes in the
financial condition of the issuers of the Securities, changes
in the industries represented in the Portfolio and changes in
economic and political conditions affecting the issuers of the
Securities.
SPECIAL CHARACTERISTICS OF THE TRUST - The Banking
Industry - The Sponsor is offering this series of the Morgan
Stanley Dean Wittier Select Equity Trust in order to take ad-
vantage of the attractive potential for capital appreciation
and dividend yield that the securities of the U.S. banks and
bank holding companies included in the Portfolio of the Trust
offer. The Sponsor has identified the banking industry in gen-
eral, and the Securities in the Portfolio of the Trust in par-
ticular, as offering the potential for capital appreciation and
current income over the life of the Trust based on the follow-
ing factors: improving quality of assets and earnings trends,
the attractive dividend yield and the potential for growth, the
potential for increased consolidation in the industry and po-
tential benefits from reduced regulation of the banking indus-
try including, the easing or elimination of federal or state
restrictions on interstate banking and engaging in certain se-
curities activities. There can be no assurance, however, that
any of the foregoing trends or factors will develop or con-
A-6
<PAGE>
SUMMARY OF ESSENTIAL INFORMATION
(Continued)
tinue, or that if they develop or continue, will have the bene-
ficial effects that the Sponsor anticipates.
Securities Selection - The Securities of U.S. banks
and bank holding companies included in this series of the Mor-
gan Stanley Dean Wittier Select Equity Trust were screened and
selected by the Sponsor's Unit Trust Research Department after
a thorough screening and analysis of a number of factors in-
cluding: (i) market capitalization and asset size; (ii) divi-
dend yield; (iii) price to earnings ratio; (iv) fundamental
economic and business characteristics; (v) technical analysis;
(vi) geographic diversification and (vii) the identification of
special situations.
There are certain risks involved in investing in the
Trust due to its concentration in stocks of one industry. The
Trust's concentration in securities of a single industry sector
means that the Trust's performance is closely related to the
specific industry conditions as well as general market condi-
tions experienced in all sectors of the economy as a whole. As
a result, changes in the economic conditions affecting the se-
lected sector will tend to have a greater impact on the value
of Units of this Trust than on units of trusts which invest in
a broader based portfolio of stocks. These factors may tend to
make the value of Trust Units more volatile than other invest-
ments.
The Sponsor may deposit additional Securities which
were originally selected through this process following the
initial Date of Deposit. The Trust will continue to hold Secu-
rities so selected during the life of the Trust unless disposed
of for the reasons set forth in "Administration of the Trust --
Portfolio Supervision", and the Sponsor may continue to create,
sell and maintain a secondary market for, Units of the Trust
even through Morgan Stanley Dean Witter's evaluation of the at-
tractiveness of the Securities may have changed subsequent to
the Date of Deposit.
Portfolio Characteristics - The Portfolio of the
Trust consists of 26 issues of Securities, all of which are
common stocks.
On November 6, 1998, the aggregate market value of
the Securities in the Trust was $86,342,517.38.
MINIMUM PURCHASE -- $1,000.
A-7
<PAGE>
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
_________________________
INTRODUCTION
This series of the Morgan Stanley Dean Witter Select
Equity Trust (the "Trust") was created on September 27, 1994
under the laws of the State of New York pursuant to a Trust In-
denture and Agreement (the "Indenture") and a related Reference
Trust Agreement (the "Agreement") (collectively, the "Indenture
and Agreement")* between Dean Witter Reynolds Inc. (the
"Sponsor") and The Bank of New York (the "Trustee"). The Spon-
sor is a principal operating subsidiary of Morgan Stanley Dean
Witter and Co. (MSDW), a publicly-held corporation. On May 31,
1997, Dean Witter, Discover & Co., Dean Witter's former parent
company, and Morgan Stanley Group Inc. merged to form MSDW.
(See: "Miscellaneous -- Sponsor", herein.) The objectives of
the Trust are capital appreciation and current income through
an investment for approximately five years from the initial
Date of Deposit in a portfolio consisting of publicly traded
common stocks of U.S. banks and bank holding companies. There
is, of course, no assurance that these objectives will be met.
On the date of creation of the Trust (the "Date of
Deposit"), the Sponsor deposited with the Trustee certain secu-
rities and contracts and funds (represented by irrevocable let-
ter(s) of credit issued by major commercial bank(s)) for the
purchase of such securities (collectively, the "Securities") at
prices equal to the market value of such Securities as deter-
mined by the Trustee as of the Date of Deposit. (See:
"Schedule of Portfolio Securities", herein.) The Trust was
created simultaneously with the deposit of the Securities with
the Trustee and the execution of the Indenture and Agreement.
The Trustee then immediately delivered to the Sponsor a cer-
tificate of beneficial interest (the "Certificate") represent-
ing the units (the "Units") comprising the entire ownership of
the Trust. Through this prospectus (the "Prospectus"), the
Sponsor is offering the Units, including Additional Units, as
defined below, for sale to the public. The holders of Certifi-
cates (the "Unit Holders") will have the right to have their
Units redeemed at a price based on the market value of the Se-
curities (the "Redemption Price") if they cannot be sold in the
* Reference is hereby made to said Indenture and Agreement
and any statements contained herein are qualified in their
entirety by the provisions of said Indenture and Agree-
ment.
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secondary market which the Sponsor, although not obligated to,
proposes to maintain. In addition, the Sponsor may offer for
sale, through this Prospectus, Units which the Sponsor may
have repurchased in the secondary market or upon the tender of
such Units for redemption. The Trustee has not participated in
the selection of Securities for the Trust, and neither the
Sponsor nor the Trustee will be liable in any way for any de-
fault, failure or defect in any Securities.
With the deposit of the Securities in the Trust on
the Date of Deposit, the Sponsor established a proportionate
relationship between the number of shares of each Security in
the Portfolio of the Trust (the "Portfolio"). The Sponsor is
permitted under the Indenture and Agreement to deposit addi-
tional Securities during the life of the Trust, resulting in an
increase in the number of Units outstanding (the "Additional
Units"). Such Additional Units may be continuously offered for
sale to the public by means of this Prospectus. Any additional
Securities deposited in the Trust in connection with the sale
of these Additional Units will maintain, to the extent practi-
cable, the proportionate relationship between the number of
shares of each Security in the Portfolio on the day of deposit
of such additional Securities and any cash not held for distri-
bution to Unit Holders prior to the deposit. The original pro-
portionate relationships are subject to adjustment under cer-
tain limited circumstances. (See: "Administration of the
Trust -- Portfolio Supervision", herein.) Each Additional Unit
issued after a permitted change in the shares held in the Trust
will represent the same number and type of shares that were
represented by a Unit immediately prior to the issuance of the
Additional Unit. The number and identity of shares in the
Trust will be adjusted to reflect the disposition of Securities
and/or the receipt of a stock dividend, a stock split or other
distribution with respect to shares or the reinvestment of the
proceeds of certain dispositions of Securities. It may not be
possible to maintain the original proportionate relationship
among the Securities on the initial date of deposit, due to,
among other reasons, inability to purchase Securities, unavail-
ability of Securities and/or restrictions on the purchase of
shares. If a Security is unavailable for purchase and deposit
in the Trust, additional shares of other Securities then in the
Portfolio of the Trust may be deposited to create Additional
Units. The Sponsor may deposit cash with the Trustee with in-
structions to the Trustee to purchase such unavailable Securi-
ties when available. The Sponsor may acquire large volumes of
additional Securities for deposit into the Trust over a short
period of time. Such acquisitions may tend to raise the market
prices of these Securities. The Sponsor cannot currently pre-
dict the actual market impact of the Sponsor's purchases of ad-
ditional Securities, because the actual volume of Securities to
be purchased and the supply and price of such Securities is not
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known. The additional Securities so received will, however,
have a tax cost basis to the Trust equal to their values on the
date of transfer to the Trust. Such tax cost basis will
likely differ from the tax cost basis of Securities transferred
to the Trust at other times such as the Date of Deposit. The
amount of gain or loss realized on sale of a particular Secu-
rity by the Trust depends upon the tax cost basis of the par-
ticular Security sold. Hence, the amount of capital gain or
loss realized by the Trust and passed through to Unit Holders
will not be the same as the capital gain or loss which would
have been realized by a particular Unit Holder if such Unit
Holder had purchased and sold the Securities involved without
the intervention of the Trust.
Units will be sold to investors at the Public Offer-
ing Price next computed after receipt of the investor's order
to purchase Units, if Units are available to fill orders on the
day that that price is set. If Units are not available or are
insufficient to fill the order, the investor's order will be
rejected by the Sponsor. The number of Units available may be
insufficient to meet demand because of the Sponsor's inability
to or decision not to purchase and deposit underlying Securi-
ties in amounts sufficient to maintain the proportionate num-
bers of shares of each Security as required to create addi-
tional Units. The Sponsor may, if unable to accept orders on
any given day, offer to execute the order as soon as sufficient
Units can be created. An investor who agrees to this will be
deemed to place a new order for that number of Units each day
until that order is accepted. The investor's order will then
be executed, when Units are available, at the Public Offering
Price next calculated after such continuing order is accepted.
The investor will, of course, be able to revoke his purchase
order at any time prior to acceptance by the Sponsor. The
Sponsor will execute orders to purchase in the order it deter-
mines that they are received, i.e., orders received first will
be filled first, except that indications of interest prior to
the effectiveness of the registration of the offering of Trust
Units which become orders upon effectiveness will be accepted
according to the order in which the indications of interest
were received.
On November 6, 1998, each Unit represented the frac-
tional undivided interest in the Securities and net income of
the Trust set forth under "Summary of Essential Information".
Thereafter, if any Units are redeemed, the amount of Securities
in the Trust will be reduced, and the fractional undivided in-
terest represented by each remaining Unit in the balance of the
Trust will be increased. However, if Additional Units are is-
sued by the Trust, the aggregate value of the Securities in the
Trust will be increased by amounts allocable to such Additional
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<PAGE>
Units and the fractional undivided interest in the balance will
be decreased. In both cases, the interest in the Securities
represented by each Unit will remain unchanged. Units will re-
main outstanding until redeemed upon tender to the Trustee by
any Unit Holder (which may include the Sponsor) or until the
termination of the Trust pursuant to the Indenture and Agree-
ment.
THE TRUST
Risk Factors - Special Considerations
An investment in Units of the Trust should be made
with an understanding of the risks which an investment in pub-
licly traded common stock may entail, including the risk that
the value of the Portfolio and hence of the Units will decline
with decreases in the market value of the Securities. The
Trust will be terminated and liquidated no later than the Man-
datory Termination Date set forth in the "Summary of Essential
Information", herein, and the Securities will be sold or dis-
tributed "in-kind", regardless of market conditions at that
time. The Trust may be terminated earlier under certain condi-
tions. (See: "Administration of the Trust -- Termination".)
Summary Description of the Portfolio
An investment in Units of the Trust should be made
with an understanding that the value of the underlying Securi-
ties, and therefore the value of Units, will fluctuate depend-
ing upon the full range of economic and market influences which
may affect the market value of such Securities. Certain risks
are inherent in an investment in equity securities, including
the risk that the financial condition of one or more of the is-
suers of the Securities may worsen or the general condition of
the stock market may weaken. In such case, the value of the
Securities and hence the value of Units may decline. Common
stocks are susceptible to general stock market movements and to
volatile and unpredictable increases and decreases in value as
market confidence in and perceptions of the issuers change from
time to time. Such perceptions are based upon varying reac-
tions to such factors as expectations regarding domestic and
foreign economic, monetary and fiscal policies, inflation and
interest rates, currency exchange rates, economic expansion or
contraction, and global or regional political, economic or
banking crises. In addition, investors should understand that
there are certain payment risks involved in owning equity secu-
rities, including risks arising from the fact that holders of
common and preferred stocks have rights to receive payments
from the issuers of those stocks that are generally inferior to
those of creditors of, or holders of debt obligations issued
by, such issuers. Furthermore, the rights of holders of common
4
<PAGE>
stocks are inferior to the rights of holders of preferred
stocks. Holders of common stocks of the type held in the Port-
folio have a right to receive dividends only when, as and if,
and in the amounts, declared by the issuer's board of direc-
tors and to participate in amounts available for distribution
by the issuer only after all other claims on the issuer have
been paid or provided for. Holders of preferred stocks have
the right to receive dividends at a fixed rate when and as de-
clared by the issuer's board of directors, normally on a cumu-
lative basis, but do not ordinarily participate in other
amounts available for distribution by the issuing corporation.
Cumulative preferred stock dividends must be paid before common
stock dividends, and any cumulative preferred stock dividend
omitted is added to future dividends payable to the holders of
such cumulative preferred stock. Preferred stocks are also en-
titled to rights on liquidation which are senior to those of
common stocks. For these reasons, preferred stocks entail less
risk than common stocks. However, neither preferred nor common
stocks represent an obligation or liability of the issuer and
therefore do not offer any assurance of income or provide the
degree of protection of capital of debt securities. The issu-
ance of debt securities (as compared with both preferred and
common stock) and preferred stock (as compared with common
stock) will create prior claims for payment of principal and
interest (in the case of debt securities) and dividends (in the
case of preferred stock) which could adversely affect the abil-
ity and inclination of the issuer to declare or pay dividends
on its preferred and/or common stock or the rights of holders
of common stock with respect to assets of the issuer upon liq-
uidation or bankruptcy. Further, unlike debt securities which
typically have a stated principal amount payable at maturity
(which value will be subject to market fluctuations prior
thereto), preferred stocks typically have only a liquidation
preference which may have stated optional or mandatory redemp-
tion provisions while common stocks have neither a fixed prin-
cipal amount nor a maturity date and have values which are sub-
ject to market fluctuations for as long as the common stocks
remain outstanding. Additionally, market timing and volume
trading will also affect the underlying value of Securities,
including the Sponsor's buying of additional Securities and the
Trust's selling of Securities during the Liquidation Period.
The value of the Securities in the Portfolio thus may be ex-
pected to fluctuate over the entire life of the Trust to values
higher or lower than those prevailing on the Date of Deposit.
The Sponsor may direct the Trustee to dispose of Securities un-
der certain specified circumstances (see: "Administration of
the Trust -- Portfolio Supervision"). However, Securities will
not be disposed of solely as a result of normal fluctuations in
market value.
5
<PAGE>
The Portfolio of the Trust is composed of securities
issued by U.S. banks and bank holding companies. There are
certain risks involved in investing in the Trust due to its
concentration in stocks of one industry. The Trust's concen-
tration in securities of a single industry sector means that
the Trust's performance is closely related to the specific in-
dustry conditions as well as general market conditions experi-
enced in all sectors of the economy as a whole. As a result,
changes in the economic conditions affecting the selected sec-
tor will tend to have a greater impact on the value of Units of
this Trust than on units of trusts which invest in a broader
based portfolio of stocks. These factors may tend to make the
value of Trust Units more volatile than other investments.
Certain Risks Affecting Securities of Banking Issu-
ers. The Trust's assets will be concentrated in Securities of
issuers in the banking industry and, as a result, the value of
the Units of the Trust will be susceptible to factors affecting
such industry. While the factors affecting the U.S. banks and
bank holding companies and the market values of the Securities
in the Portfolio are varied and complex, the risks of invest-
ment in such Securities outlined below should be noted.
The activities of U.S. banks and bank holding compa-
nies are subject to comprehensive federal and state regulation
which regulation is expected to continue to change over the
life of the Trust. The enactment of any new legislation or
regulations, or any change in interpretation or enforcement of
existing laws of regulations, may affect the profitability of
participants in the banking industry. Congress is currently
considering removing restrictions to interstate banking. No
assurance can be given as to what form such legislation, or any
other legislation or regulation, would take, if enacted, or
what effects any new legislation or regulation would have on
the banking industry.
The banking industry is particularly susceptible to
downturns in economic, and volatility in political conditions
as well as fiscal or monetary policies of governmental units.
Banks may be at particular risk in a protracted recession,
given that the levels of corporate debt, corporate defaults on
debts, the number of bank failures and problem banks are sub-
stantially higher than is typical during a non-recessionary pe-
riod. Certain banks whose securities are included in the Port-
folio may have loan portfolios concentrated in highly leveraged
transactions, real estate loans or loans to less developed
countries, which transactions and loans bank regulators clas-
sify as risky. The operations of banks are highly interest
rate sensitive. An inflationary economy or tight credit poli-
cies imposed by the Federal Reserve could adversely affect the
banking industry. Investors should note that monetary policies
6
<PAGE>
of the Federal Reserve are subject to significant fluctuations.
A deflationary economy, when asset values decline, poses risks
to banks by reducing the value of direct investments held for
the banks' own portfolios and contributing to loan defaults if
the value of secured property or other collateral for loans
declines. Banks are particularly susceptible to the real es-
tate markets since a significant amount of their loans are se-
cured by real estate, the value of which is subject to signifi-
cant fluctuations.
Federal regulations require banks and thrifts to
maintain minimum capital requirements. To the extent addi-
tional equity is issued to meet the requirements, outstanding
equity holdings will be diluted. The capital standards are ex-
pected to continue to lead to a major consolidation of the bank
and thrift systems. Certain Money Center Banks have experi-
enced problems in obtaining access to equity and debt markets.
No assurance can be given that any bank will maintain access to
the public credit markets on affordable terms to meet their
capital or short term cash needs. The Sponsor is unable to
predict the impact or the likelihood of any consolidation re-
sulting from the capital standards or any change in the inter-
state banking laws and regulations, with respect to the par-
ticular Securities in the Portfolio.
Banks are subject to substantial competition from
other banking and thrift institutions and from other financial
service institutions for deposits, as well as corporate and re-
tail customers. These competitors, which are subject to less
government regulation than banks provide a broad range of fi-
nancial products, and include foreign banks, insurance compa-
nies, brokerage and securities firms, mutual funds, investment
banks and diversified financial service companies. As a result
of such competition worldwide, depository flows have become
highly liquid, and subject to dramatic shifts among different
forms of financial instruments.
To the extent banks are unable to pass deposit insur-
ance premiums on to customers because of competitive pressures
(e.g., from money market mutual funds), such premiums must be
absorbed. Any premium increase may lead to insolvency by some
problem banks. No assurance can be given that statutory provi-
sions for insuring all deposits up to $100,000 (which currently
applies to multiple accounts held by the same depositor and to
pass-through accounts, such as for pension plans) will not be
restricted. Such restrictions could adversely affect large in-
vestor confidence, which could lead to deposit runs. In addi-
tion, no assurance can be given that foreign branch deposits of
domestic banks will remain exempt from assessments for deposit
insurance premiums or retain their de facto insurance coverage.
Either policy change could have a substantial adverse impact on
7
<PAGE>
affected banks, particularly Money Center Banks. Investors
should note that deposit insurance does not cover equity issued
by banks and therefore is no guarantee of the market value of
the Securities in the Portfolio.
To the extent a bank's portfolio is concentrated in
assets related to a particular industry or geographic region,
the bank's operating results will be subject to additional
risks associated with such industry or region. A significant
downgrading of a credit rating could jeopardize the affected
bank's access to public credit markets. Deposits from foreign
corporations, individuals and governments constitute a substan-
tial share (frequently a majority) of total deposits of Money
Center Banks, including their foreign branches. The level of
such deposits is generally subject to the risks of foreign cur-
rency exchange rates (a falling U.S. dollar reducing the value
of their investments), comparative interest rate changes and
capital flight restrictions.
There can be no assurance that a market will be made
for any of the Securities, that any market for the Securities
will be maintained or of the liquidity of the Securities in any
markets made. In addition, the Trust may be restricted under
the Investment Company act of 1940 from selling Securities to
the Sponsor. The price at which the Securities may be sold to
meet redemptions and the value of the Trust will be adversely
affected if trading markets for the Securities are limited or
absent.
Objective and Securities Selection
The objectives of the Trust are to provide capital
appreciation potential and current income during the five years
after the initial Date of Deposit through an investment in a
fixed diversified portfolio of Securities chosen in the manner
described in the "Summary of Essential Information", herein.
There is, of course, no guarantee that the Trust's objectives
will be achieved.
The Trust consists of such of the Securities listed
under "Schedule of Portfolio Securities" as may continue to be
held from time to time in the Trust and any additional and sub-
stitute Securities acquired and held by the Trust pursuant to
the provisions of the Indenture and Agreement together with un-
distributed income therefrom and undistributed and uninvested
cash realized from the disposition of Securities (see:
"Administration of the Trust"). Neither the Sponsor nor the
Trustee shall be liable in any way for any default, failure or
defect in any of the Securities. However, should any contract
deposited hereunder fail and no substitute Security be acquired
pursuant to the provisions of the Indenture and Agreement, the
8
<PAGE>
Sponsor shall cause to be refunded the sales charge relating to
such Security, plus the pro rata portion of the cost to the
Sponsor of the failed contract listed under "Schedule of Port-
folio Securities". (See: "Administration of the Trust --
Portfolio Supervision".)
Because certain Securities from time to time may be
sold or their percentage reduced under certain circumstances
described herein, and because additional Securities may be de-
posited into the Trust from time to time, no assurance can be
given that the Trust will retain for any length of time its
present size and composition (see: "Administration of the
Trust -- Portfolio Supervision", herein).
The Trust is organized as a unit investment trust and
not as a management investment company. Therefore, neither the
Trustee nor the Sponsor has the authority to manage the Trust's
assets fully in an attempt to take advantage of various market
conditions to improve the Trust's net asset value and, further,
the Trust's Securities may be disposed of only under limited
circumstances. (See: "Administration of the Trust -- Portfo-
lio Supervision".)
There is no assurance that any dividends will be de-
clared or paid in the future on the Securities initially depos-
ited or to be deposited subsequently in the Trust.
Distributions
Record Dates and the Distribution Dates are set forth
under "Summary of Essential Information". The distributions
will be an amount equal to such Unit Holder's pro rata portion
of the amount of dividend income received by the Trust and pro-
ceeds of the sale of Securities, including capital gains, not
used for the redemption of Units (less the Trustee's fees,
Sponsor's portfolio supervision fees and expenses). Distribu-
tions for the account of beneficial owners of Units registered
in "Street name" and held by the Sponsor will be made to the
investment account of such beneficial owners maintained with
the Sponsor. Under certain circumstances, the Trustee may make
additional distributions in any calendar year in order to avoid
the imposition of Federal or state excise taxes or to continue
or otherwise maintain the Trust's qualification as a regulated
investment company under subchapter M of the Internal Revenue
Code of 1986, as amended (see: "Tax Status of the Trust").
TAX STATUS OF THE TRUST
The following discussion offers only a brief outline
of the federal income tax consequences of investing in the
Trust. Investors should consult their own tax advisors for
9
<PAGE>
more detailed information and for information regarding the im-
pact of state, local or foreign taxes upon such an investment.
The Trust intends to qualify as and elect to be a
regulated investment company under Subchapter M of the Internal
Revenue Code of 1986, as amended (the "Code"). Generally, to
qualify as a regulated investment company for a taxable year
the Trust must derive at least 90% of its income from certain
specified sources, including interest, dividends, gains from
the disposition of securities, and other income derived with
respect to its business of investing in securities. In addi-
tion, the Trust must meet certain diversification criteria re-
garding Trust investment, and must distribute annually at least
90% of its investment company taxable income. For any year in
which the Trust qualifies for taxation as a regulated invest-
ment company, (a) the Trust is not taxed on income distributed
to its shareholders in the form of dividends or capital gains
distributions and (b) if the Trust is the record holder of
stock on the record date for a dividend payable with respect to
that stock, the dividend must be included in the gross income
of the Trust as determined for federal income tax purposes on
the later of (1) the date the stock became ex-dividend with re-
spect to such dividend or (2) the date the Trust acquired the
stock. If, in any taxable year, the Trust were to fail to
qualify as a regulated investment company under the Code, the
Trust would be taxed for that year in the same manner as an or-
dinary corporation and distributions to its shareholders would
not be deductible by the Trust in computing its taxable income.
In addition, in the event of a failure to qualify as a regu-
lated investment company for a taxable year, that year's Trust
distributions, to the extent derived from current or accumu-
lated earnings and profits, would be taxable to the recipient
shareholders as ordinary income dividends, even if those dis-
tributions might otherwise have been considered distributions
of capital gains.
If the Trust fails to distribute in each calendar
year, at least (i) 98% of its ordinary income for such calendar
year and (ii) 98% of its capital gain net income (both long-
term and short-term) for the 12 months ended October 31 of such
calendar year (or December 31, if the Trust qualifies to so
elect and does so), the Trust will be subject to a 4% excise
tax on the undistributed income if income tax is not imposed on
such income in the hands of the Trust. In addition, the Trust
will be subject to such excise tax on any portion (not taxed to
the Trust) of the respective 2% balances which are not distrib-
uted during the succeeding calendar year.
If the Trust fails to qualify as a regulated invest-
ment company for any year, it must pay out its earnings and
profits accumulated in that year (less the interest charge men-
10
<PAGE>
tioned below, if applicable) and may be required to pay an in-
terest charge to the Treasury on 50% of such earnings and prof-
its before it can again qualify as a regulated investment com-
pany.
Generally, distributions paid by the Trust, whether
or not reinvested, are treated as received in the taxable year
of the distribution; however, any amounts designated for dis-
tribution by the Trust with respect to October, November or De-
cember of any calendar year as payable to Unit Holders of rec-
ord on a specified date in such a month and which are actually
paid during January of the following year, will be treated as
received on December 31 of the preceding year. The Indenture
and Agreement require current distribution to Unit Holders of
the entire net income and net capital gain, if any, of the
Trust and cash proceeds of redemptions, mergers, liquidations
of issuers or sales representing recovery of cost (to the ex-
tent that the proceeds of sales or other dispositions are not
reinvested or used to redeem Units) of underlying Securities in
the Trust. In kind receipts of the Trust in mergers and liqui-
dations may be either retained or sold and the proceeds, if
sold, will be either (i) distributed to Unit Holders or
(ii) retained by the Trustee with the proceeds of such sale
credited to the Income and/or Principal Accounts and (unless
applied for the purchase of securities pursuant to the Inden-
ture and Agreement) distributed to Unit Holders in the manner
provided in the Indenture and Agreement. Securities received
in a liquidation or merger will not be retained if such reten-
tion would jeopardize the characterization of the Trust as a
regulated investment company for federal income tax purposes.
Distributions to Unit Holders (other than capital
gains distributions) will be taxable as ordinary income to such
Unit Holders to the extent paid from interest, dividends and
net short-term capital gain includible in the Trust's gross in-
come for the taxable year with respect to which the distribu-
tion is made less the sum of the Trust's allocable deductible
expenses. To the extent that distributions to a Unit Holder
with respect to any year are not taxable as ordinary income or
as capital gain distributions, the amount of such distributions
will be treated as a return of capital and will reduce the Unit
Holder's basis in its Units and, to the extent that they exceed
its basis, will generally be taxed as a capital gain.
It is anticipated that part of the distributions of
the Trust will be taxable as ordinary income to Unit Holders
and that, under present law, distributions attributable to
dividends from domestic corporations constitute dividends for
purposes of the 70% deduction allowed to certain corporations
with respect to dividends received, as discussed below. This
deduction is allowed to corporations other than corporations,
11
<PAGE>
such as "S" corporations, which are not eligible for such de-
duction because of their special characteristics. Dividends
received by corporations are not deductible for purposes of
special taxes such as the accumulated earnings tax and the per-
sonal holding company tax.
Under existing law, only that amount of the Trust's
dividend distributions (exclusive of capital gain dividends)
that are designated as dividends by the Trust and which do not
exceed the aggregate amount of dividends received by the Trust
will qualify for the 70% dividends-received deduction for cor-
porations. Dividends received by the Trust will be considered
dividends for this purpose only if such dividends are received
from domestic corporations and would qualify for the 70% divi-
dends-received deduction if such deduction were available to
regulated investment companies.
Individual investors should note that the Code places
a floor of 2% of adjusted gross income on miscellaneous item-
ized deductions, including investment expenses. The Code di-
rects the Secretary of the Treasury to prescribe regulations
prohibiting indirect deduction through a pass-through entity
(such as the Trust) of amounts not allowable as a deduction un-
der this rule if paid or incurred directly by an individual.
Temporary Regulations applicable to "nonpublicly of-
fered regulated investment companies" have been issued. Under
these temporary regulations, in general, (i) specified expenses
of the regulated investment company or, at the election of the
regulated investment company, 40% of its expenses, exclusive of
expenses which are specifically excluded from miscellaneous
itemized deductions if incurred by an individual, are allocated
among those of its shareholders who are "affected investors"
(i.e., individuals, estates, trusts and pass-through entities
having such shareholders) and (ii) such investors are treated
as having received or accrued dividends in an aggregate amount
equal to the investor's share of such expenses and to have in-
curred investment expenses in the same aggregate amount. These
computations are made on a calendar year basis and the alloca-
tion of such expenses among affected investors may be done by
the regulated investment company on any reasonable basis (which
basis, if utilizing distributions to affected investors, may
exclude some of such distributions).
The Code provides, however, that the 2% floor rule
will not apply to indirect deductions through a publicly of-
fered regulated investment company. The term "publicly offered
regulated investment company" is defined as meaning a regulated
investment company the shares of which are "continuously of-
fered" or regularly traded on an established securities market
or "held by or for no fewer than 500 persons at all times dur-
12
<PAGE>
ing the taxable year." The Sponsor is unable to state whether
or not the Trust will qualify in the future for treatment as a
"publicly offered regulated investment company."
Gain or loss will be realized by each Unit Holder to
the extent that the proceeds of redemption (or distributions
received upon liquidation of its Units) exceed or are less than
the Unit Holder's tax cost basis of its Units which are re-
deemed (or in respect of which the liquidating distributions
are made). Distributions in kind are taken into account for
this purpose at their fair market value when distributed.
Distributions of net capital gain (designated as such
by the Trust) will be taxable to Unit Holders as long-term
capital gains regardless of the length of time the Units have
been held by a Unit Holder. A redemption of Units will be a
taxable event for a Unit Holder and, depending on the circum-
stances, may give rise to gain or loss. Under the Code, net
capital gain (i.e., the excess of net long-term capital gain
over net short-term capital loss) of individuals, estates and
trusts is subject to a maximum nominal tax rate of 20%. Such
capital gain may, however, result in a disallowance of itemized
deductions and/or affect a personal exemption phase-out. The
maximum lower capital gain rate of 20% will be unavailable with
respect to those Securities which have been held for less than
a year and a day at the time of sale (including sales occa-
sioned by mandatory or early termination of the Trust or ex-
change or rollover of Units).
The Code disallows the dividends-received deduction
in full for corporations with respect to stock, including Trust
Units (which are considered as stock for this purpose) held for
45 days or less (90 days or less in the case of certain prefer-
ence stock) exclusive of days on which the holder's risk of
loss is diminished. Sections 246 and 246A of the Code also
contain limitations on the eligibility of dividends for the 70%
dividends-received deduction (in addition to the limitation
discussed above). These limitations may be applicable to divi-
dends received by a Unit Holder depending on the Unit Holder's
individual circumstances. Accordingly, Unit Holders which are
corporations should consult their own tax advisors in this re-
gard.
Information with respect to the Federal income tax
status of each year's distributions will be supplied to Unit
Holders.
The Trust is required to withhold U.S. federal income
tax at the rate of 31% of all taxable distributions payable to
holders of Trust Units who fail to provide the Trust with their
correct taxpayer identification numbers or to make required
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certifications, or who have been notified by the Internal Reve-
nue Service that they are subject to backup withholding.
Backup withholding is not an additional tax. Any amounts with-
held may be credited against U.S. federal income tax liability
of a holder of a Trust Unit.
Federal withholding taxes at a 30% rate or a lesser
rate established by treaty will generally apply to distribu-
tions (other than distributions designated by the Trust as
capital gain dividends) made to Unit Holders that are nonresi-
dent aliens or foreign partnerships, trusts or corporations un-
less the distributions constitute income effectively connected
with the conduct of a trade or business within the United
States by the distributee.
The value of Units held by an individual non-resident
alien, even though he is a non-resident at his death, will be
includible in his gross estate for U.S. federal estate tax pur-
poses.
Investors are advised to consult their own tax advis-
ers with respect to the application to their own circumstances
of the above-described general taxation rules and with respect
to the state, local or foreign tax consequences to them of an
investment in Trust Units.
Units of the Trust may be suited for purchase by In-
dividual Retirement Accounts and pension plans, profit sharing
and other qualified retirement plans. Investors considering
participation in any such plan should consult their attorneys
or other tax advisors with respect to the establishment and
maintenance of any such plan.
PUBLIC OFFERING OF UNITS
Public Offering Price
The Public Offering Price of the Units is calculated
daily, and is computed by adding to the aggregate market value
of the Portfolio Securities (as determined by the Trustee) next
computed after receipt of a purchase order, divided by the num-
ber of Units outstanding, the sales charge shown in "Summary of
Essential Information". After the initial Date of Deposit, a
proportionate share of amounts in the Income and Principal Ac-
counts and amounts receivable in respect of stocks trading ex-
dividend (other than money required to be distributed to Unit
Holders on a Distribution Date and money required to redeem
tendered Units) on the date of purchase of Units is added to
the Public Offering Price. In the event a stock is trading ex-
dividend at the time of deposit of additional Securities, an
amount not to exceed the dividend that would be received if
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<PAGE>
such stock were to receive a dividend will be added to the Pub-
lic Offering Price. The sales charge will decline over the
life of the Trust in the manner described in "Summary of Essen-
tial Information -- Public Offering Price". The Public Offer-
ing Price per Unit is calculated to five decimal places and
rounded up or down to four decimal places. The Public Offering
Price on any particular date will vary from the Public Offer-
ing Price on November 6, 1998 (set forth in the "Summary of Es-
sential Information", herein) in accordance with fluctuations
in the aggregate market value of the Securities, the amount of
available cash on hand in the Trust and the amount of certain
accrued fees and expenses.
As more fully described in the Indenture and Agree-
ment, the aggregate market value of the Securities is deter-
mined on each business day by the Trustee based on closing
prices on the day the valuation is made or, if there are no
such reported prices, by taking into account the same factors
referred to under "Redemption -- Computation of Redemption
Price". Determinations are effective for transactions effected
subsequent to the last preceding determination.
Public Distribution
Units issued on the Date of Deposit and Additional
Units issued in respect of additional deposits of Securities
will be distributed to the public by the Sponsor and through
dealers at the Public Offering Price determined as provided
above. Unsold Units or Units acquired by the Sponsor in the
secondary market referred to below may be offered to the public
by this Prospectus at the then current Public Offering Price
determined as provided above.
The Sponsor intends to qualify Units in states se-
lected by the Sponsor for sale by the Sponsor and through deal-
ers who are members of the National Association of Securities
Dealers, Inc. In addition, sales of Units may be made pursuant
to distribution arrangements with certain banks and/or other
entities subject to regulation by the Office of the Comptroller
of the Currency which are acting as agents for their customers.
These banks and/or entities are making Units of the Trust
available to their customers on an agency basis. A portion of
the sales charge paid by these customers is retained by or re-
mitted to such banks or entities in an amount equal to the fee
customarily received by an agent for acting in such capacity in
connection with the purchase of Units. The Glass-Steagall Act
prohibits banks from underwriting certain securities, including
Units of the Trust; however, this Act does permit certain
agency transactions, and banking regulators have not indicated
that these particular agency transactions are impermissible un-
der this Act. In Texas, as well as certain other states, any
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<PAGE>
bank making Units available must be registered as a broker-
dealer in that State. The Sponsor reserves the right to re-
ject, in whole or in part, any order for the purchase of Units.
Secondary Market
While not obligated to do so, it is the Sponsor's
present intention to maintain, at its expense, a secondary mar-
ket for Units of this series of the Morgan Stanley Dean Witter
Select Equity Trust and to continuously offer to repurchase
Units from Unit Holders at the Sponsor's Repurchase Price. The
Sponsor's Repurchase Price is computed by adding to the aggre-
gate value of the Securities in the Trust, any cash on hand in
the Trust including dividends receivable on stocks trading ex-
dividend (other than money required to redeem tendered Units
and cash deposited by the Sponsor to purchase Securities or
cash held in the Reserve Account) and deducting therefrom ex-
penses of the Trustee, Sponsor, counsel and taxes, if any, and
cash held for distribution to Unit Holders of record as of a
date on or prior to the evaluation; and then dividing the re-
sulting sum by the number of Units outstanding, as of the date
of such computation. There is no sales charge incurred when a
Unit Holder sells Units back to the Sponsor. Any Units repur-
chased by the Sponsor at the Sponsor's Repurchase Price may be
reoffered to the public by the Sponsor at the then current Pub-
lic Offering Price. Any profit or loss resulting from the re-
sale of such Units will belong to the Sponsor.
If the supply of Units exceeds demand (or for any
other business reason), the Sponsor may, at any time, occasion-
ally, from time to time, or permanently, discontinue the repur-
chase of Units of this series at the Sponsor's Repurchase
Price. In such event, although under no obligation to do so,
the Sponsor may, as a service to Unit Holders, offer to repur-
chase Units at the "Redemption Price". Alternatively, Unit
Holders may redeem their Units through the Trustee.
Profit of Sponsor
The Sponsor receives a sales charge on Units sold to
the public and to dealers. The Sponsor may have also realized
a profit (or sustained a loss) on the deposit of the Securities
in the Trust representing the difference between the cost of
the Securities to the Sponsor and the cost of the Securities to
the Trust. The Sponsor may realize a similar profit (or loss)
in connection with each additional deposit of Securities. In
addition, the Sponsor may have acted as broker in transactions
relating to the purchase of Securities for deposit in the
Trust. During the initial public offering period the Sponsor
may realize additional profit (or sustain a loss) due to daily
fluctuations in the prices of the Securities in the Trust and
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<PAGE>
thus in the Public Offering Price of Units received by the
Sponsor. Cash, if any, received by the Sponsor from the Unit
Holders prior to the settlement date for purchase of Units or
prior to the payment for Securities upon their delivery may be
used in the Sponsor's business and may be of benefit to the
Sponsor.
The Sponsor may also realize profits (or sustain
losses) while maintaining a secondary market in the Units, in
the amount of any difference between the prices at which the
Sponsor buys Units and the prices at which the Sponsor resells
such Units (such prices include a sales charge) or the prices
at which the Sponsor redeems such Units, as the case may be.
Volume Discount
Although under no obligation to do so, the Sponsor
intends to permit volume purchasers of Units to purchase Units
at a reduced sales charge. The Sponsor may at any time change
the amount by which the sales charge is reduced, or may discon-
tinue the discount altogether.
The sales charge of 2.50% of the Public Offering
Price will be reduced pursuant to the following graduated scale
for sales to any person of at least $750,000.
Percent of
Public Percent of
Offering Net Amount Dealer
Aggregate Value of Units Price Invested Concession
Less than $249,999....... 3.00% 3.092% 1.95%
$250,000 to $499,999....... 2.75% 2.828% 1.79%
$500,000 to $749,999....... 2.50% 2.564% 1.63%
$750,000 to $999,999....... 2.25% 2.302% 1.46%
$1,000,000 to $2,499,999... 1.75% 1.781% 1.14%
$2,500,000 to $4,999,999... 1.25% 1.266% 0.81%
$5,000,000 or more......... 0.75% 0.756% 0.49%
The reduced sales charges as shown on the chart above
will apply to all purchases of Units of this Trust only on any
one day by the same person, partnership or corporation (other
than a dealer), in the amounts stated herein.
Units held in the name of the purchaser's spouse or
in the name of a purchaser's child under the age of 21 years
are deemed for the purposes hereof to be registered in the name
of the purchaser. The reduced sales charges are also applica-
ble to a trustee or other fiduciary, including a partnership or
corporation, purchasing Units for a single trust estate or sin-
gle fiduciary account.
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<PAGE>
Sales to Dealers will be made at prices which include
a concession as shown on the chart above. Dealers purchasing
certain dollar amounts of Units during the life of the Trust
will be entitled to additional concession benefits. The dealer
concession for secondary market sales may differ from the con-
cessions set forth in the above schedule. The Sponsor reserves
the right, at any time, to change the level of dealer conces-
sions.
EXCHANGE OPTION
Unit Holders of any Dean Witter sponsored unit in-
vestment trust or any holders of Units of any other unit in-
vestment trust (collectively, "Holders") may elect to exchange
any or all of their units of each series of the Morgan Stanley
Dean Witter Select Equity Trust for units of one or more of any
series of the Dean Witter Select Equity Trust or for units of
any additional Dean Witter Select Trusts, that may from time to
time be made available for such exchange by the Sponsor (the
"Exchange Trusts"). Such Units may be acquired at prices based
on reduced sales charges per Unit. The purpose of such reduced
sales charges is to permit the Sponsor to pass on to the Holder
who wishes to exchange Units the cost savings resulting from
such exchange of Units. The cost savings result from reduc-
tions in time and expense related to advice, financial planning
and operational expense required for the Exchange Option. The
following Exchange Trusts are currently available: series of
the Dean Witter Select Municipal Trust, the Morgan Stanley Dean
Witter Select Government Trust, the Morgan Stanley Dean Witter
Select Equity Trust, the Dean Witter Select Corporate Trust and
the Dean Witter Select Investment Trust.
Each Exchange Trust has a different investment objec-
tive; a Holder should read the prospectus for the applicable
Exchange Trust carefully to determine the investment objective
prior to exercise of this option.
This option will be available provided the Sponsor
maintains a secondary market in units of the applicable Ex-
change Trust and provided that units of the applicable Exchange
Trust are available for sale and are lawfully qualified for
sale in the state in which the Holder is a resident. While it
is the Sponsor's present intention to maintain a secondary mar-
ket for the units of all such trusts, there is no obligation on
its part to do so. Therefore, there is no assurance that a
market for units will in fact exist on any given date on which
a Holder wishes to sell or exchange its Units; thus, there is
no assurance that the Exchange Option will be available to any
Unit Holder. The Sponsor reserves the right to modify, suspend
or terminate this option at any time without further notice to
Unit Holders. In the event the Exchange Option is not avail-
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<PAGE>
able to a Unit Holder at the time such Unit Holder wishes to
exercise it, the Unit Holder will be immediately notified and
no action will be taken with respect to its Units without fur-
ther instruction from the Unit Holder.
Exchanges will be effected in whole units only. Any
excess proceeds from the surrender of a Unit Holder's Units
will be returned. Alternatively, Unit Holders will be permit-
ted to make up any difference between the amount representing
the Units being submitted for exchange and the amount repre-
senting the Units being acquired up to the next highest number
of whole Units.
An exchange of Units pursuant to the Exchange Option
will constitute a "taxable event" under the Code, i.e., a
Holder will recognize gain or loss at the time of exchange. A
Unit Holder who exchanges Units of one Trust for units of an-
other Trust should consult his or her tax advisor regarding the
extent to which such exchange results in the recognition of a
loss for Federal and/or state or local income tax purposes.
If a Unit Holder utilizes the Exchange Option with
respect to an Exchange Trust which is a regulated investment
company for U.S. federal income tax purposes before the 91st
day after the exchanged Units were acquired, the sales charge
incurred in acquiring the Units transferred in the exchange (up
to the amount of the reduction in the sales charge with respect
to the securities received in the exchange) is not taken into
account in determining the amount of gain or loss on the ex-
change but any sales charge disallowed is added to the basis of
the Units acquired.
To exercise the Exchange Option, a Unit Holder should
notify the Sponsor of its desire to use the proceeds from the
sale of its Units to purchase units of one or more of the Ex-
change Trusts. If units of the applicable outstanding series
of the Exchange Trust are at that time available for sale, the
Holder may select the series or group of series for which such
Units are to be exchanged. The Holder will be provided with a
current prospectus or prospectuses relating to each series in
which interest is indicated.
The exchange transaction will operate in a manner es-
sentially identical to any secondary market transaction, i.e.,
Units will be repurchased at a price equal to the aggregate bid
side evaluation per Unit of the Securities in the Portfolio,
plus accrued interest. Units of the Exchange Trust will be
sold to the Unit Holder at a price equal to the evaluation per
unit of the securities in that Portfolio, plus accrued interest
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<PAGE>
and the applicable sales charge of $25 per Unit (or per 100
Units in the case of a unit priced at about $10.00 or per 1,000
Units in the case of a unit priced at about $1.00) or 2.5% of
the Public Offering Price where the cost per Unit is signifi-
cantly less than $1.00. If a Unit Holder has held its Units
for less than a five-month period, the sales charge shall be
the greater of (i) $25 or (ii) the difference between the
original sales charge on the Units owned and the sales charge
on the Exchange Trust.
REINVESTMENT PROGRAM
Distributions, if any, are made to Unit Holders quar-
terly. The Unit Holder has the option, however, of either re-
ceiving his quarterly check from the Trustee or participating
in the reinvestment program offered by the Sponsor under which
the distributions are automatically reinvested in Additional
Units of the Trust without a sales charge. Participation in
the reinvestment program is conditioned on such program's law-
ful qualification for sale in the state in which the Unit
Holder is a resident. A Unit Holder's election to participate
in the reinvestment program will apply to all Units of this se-
ries of the Trust owned by such Unit Holder. Once the rein-
vestment election has been chosen by the Unit Holder, such
election will remain in effect until changed by the Unit
Holder. The Sponsor may suspend or terminate the reinvestment
program at its discretion. Thereafter, distributions received
by the Trust would be distributed quarterly to all Unit Hold-
ers.
Such distributions, to the extent reinvested in Units
of the Trust, will be used by the Trustee at the direction of
the Sponsor in one or both of the following manners. (i) The
distributions may be used by the Trustee to purchase Units of
this Series of the Trust held in the Sponsor's inventory. The
purchase price payable by the Trustee for each of such Units
will be equal to the applicable Trust evaluation per Unit on
(or as soon as possible after) the close of business on the
Distribution Date. The Units so purchased by the Trustee will
be issued or credited to the accounts of Unit Holders partici-
pating in the Program. (ii) If there are no Units in the Spon-
sor's inventory, the Sponsor may purchase additional Securities
in order to maintain, as closely as practical, the proportion-
ate relationship between the Securities in the Trust at the
time of creation of the additional Units. The additional secu-
rities will be deposited by the Sponsor with the Trustee in ex-
change for new Units. The distributions may then be used by
the Trustee to purchase the new Units from the Sponsor. The
price for such new Units will be the applicable Trust evalua-
tion per Unit on (or as soon as possible after) the close of
business on the Distribution Date. (See: "Public Offering --
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<PAGE>
Public Offering Price".) The Units so purchased by the Trustee
will be issued or credited to the accounts of Unit Holders par-
ticipating in the Program.
No fractional Units will be issued under any circum-
stances. If, after the maximum number of full Units have been
issued or credited at the applicable price, there remains a
portion of the distribution which is not sufficient to purchase
a full Unit as such price, the Trustee shall hold such cash for
the benefit of such Unit Holder and shall apply such cash on
the next Distribution Date, along with any distributions then
made, toward the purchase of additional full Units in accor-
dance with the Program. The cost of administering the program
will be borne by the Trust and thus will be borne indirectly by
all Unit Holders.
A Unit Holder may, by contacting such Unit Holder's
broker or filing with the Trustee a written notice of election
at least ten days before the Record Date for the first distri-
bution to which it is to apply, elect to have distributions, if
any, reinvested in Additional Units of the Trust. An election
may be revoked upon similar notice.
REDEMPTION
Right of Redemption
One or more Units represented by a Certificate may be
redeemed at the Redemption Price upon tender of such Certifi-
cate to the Trustee at its unit investment trust office in the
City of New York, properly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Trustee (as
set forth in the Certificate), and executed by the Unit Holder
or its authorized attorney. A Unit Holder may tender its Units
for redemption at any time after the settlement date for pur-
chase, whether or not it has received a definitive Certificate.
The Redemption Price per Unit is calculated as set forth under
"Computation of Redemption Price", herein. There is no sales
charge incurred when a Unit Holder tenders its Units to the
Trustee for redemption.
On the seventh calendar day following the tender to
the Trustee of Certificates representing Units to be redeemed
(or if the seventh calendar day is not a business day, on the
first business day prior thereto) the Unit Holder will be enti-
tled to receive monies per Unit equal to the Redemption Price
per Unit as determined by the Trustee as of the Evaluation Time
on the date of tender. The date of tender is deemed to be the
date on which Units are received by the Trustee, except that as
regards Units received after the Evaluation Time, the date of
tender is the first day after such date on which the New York
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<PAGE>
Stock Exchange is open for trading, and such Units will be
deemed to have been tendered to the Trustee on such day for
redemption at the Redemption Price computed on that day.
During the period in which the Sponsor maintains a
secondary market for Units, the Sponsor may repurchase any Unit
presented for tender to the Trustee for redemption no later
than the close of business on the next business day following
such presentation.
Units will be redeemed by the Trustee in cash or in
kind for any one Unit Holder tendering less than 25,000 Units,
the Sponsor may determine, in its discretion, to direct the
Trustee to redeem Units "in kind" by distributing Portfolio Se-
curities to the redeeming Unit Holder. The Sponsor may direct
the Trustee to redeem Units "in kind" even if it is then main-
taining a secondary market in Units of the Trust. Unit Holders
redeeming "in kind" will receive an amount and value of Trust
Securities per Unit equal to the Redemption Price Per Unit as
determined as of the Evaluation Time next following the tender
as set forth herein under "Computation of Redemption Price" be-
low. The distribution "in kind" for redemption of Units will
be held by the Trustee for the account of, and for disposition
in accordance with the instructions of, the tendering Unit
Holder. The tendering Unit Holder will be entitled to receive
whole shares of each of the underlying Portfolio Securities,
plus cash equal to the Unit Holder's pro rata share of the cash
balance of the Income and Principal Accounts and cash from the
Principal Account equal to the fractional shares to which such
tendering Unit Holder is entitled. The Trustee, in connection
with implementing the redemption "in kind" procedures outlined
above, may make any adjustments necessary to reflect differ-
ences between the Redemption Price of Units and the value of
the Securities distributed "in kind" as of the date of tender.
If the Principal Account does not contain amounts sufficient to
cover the required cash distribution to the tendering Unit
Holder, the Trustee is empowered to sell Securities in the
Trust Portfolio in the manner discussed below. A Unit Holder
receiving redemption distributions of Securities "in kind" may
incur brokerage costs in converting Securities so received into
cash.
The portion of the Redemption Price which represents
the Unit Holder's interest in the Income Account shall be with-
drawn from the Income Account to the extent available. The
balance paid on any redemption, including dividends receivable
on stocks trading ex-dividend, if any, shall be drawn from the
Principal Account to the extent that funds are available for
such purpose. The Trustee is authorized by the Indenture and
Agreement to sell Securities in order to provide funds for re-
demption. To the extent Securities are sold, the size and di-
22
<PAGE>
versity of the Trust will be reduced. Such sales may be re-
quired at the time when Securities would not otherwise be sold
and might result in lower prices than might otherwise be real-
ized. The Redemption Price received by a tendering Unit Holder
may be more or less than the purchase price originally paid by
such Unit Holder, depending on the value of the Securities in
the Portfolio at the time of redemption. Moreover, due to the
minimum lot size in which Securities may be required to be
sold, the proceeds of such sales may exceed the amount neces-
sary for payment of Units redeemed. Such excess proceeds will
be distributed pro rata to all remaining Unit Holders of record
on the next Distribution Date.
Securities to be sold for purposes of redeeming Units
will be selected from a list supplied by the Sponsor. If not
so instructed by the Sponsor, the Trustee will select the Secu-
rities to be sold so as to maintain, as closely as practicable,
the proportionate relationship between the number of shares of
each Security in the Trust.
Computation of Redemption Price
The Trust Evaluation per Unit is determined as of the
Evaluation Time stated under "Summary of Essential Informa-
tion", above, and (a) semiannually, on the last business day of
each of the months of June and December, (b) on the day on
which any Unit of the Trust is tendered for redemption (unless
tender is made after the Evaluation Time on such day, in which
case Tender shall be deemed to have been made on the next day
subsequent thereto on which the New York Stock Exchange is open
for trading) and (c) on any other business day desired by the
Sponsor or the Trustee, (1) by adding:
a. The aggregate value of Securities in the Trust,
as determined by the Trustee;
b. Cash on hand in the Trust, including dividends
receivable on stocks trading ex-dividend, other
than money deposited to purchase Securities or
money credited to the Reserve Account;
c. All other assets of the Trust;
(2) and then, by deducting from the resulting fig-
ure; amounts representing any applicable taxes or governmental
charges payable by the Trust for the purpose of making an addi-
tion to the reserve account (as defined in the Indenture and
Agreement, the "Reserve Account"), amounts representing esti-
mated accrued fees and expenses of the Trust (including legal
and auditing expenses), amounts representing unpaid fees of the
Trustee, the Sponsor and counsel and monies held to redeem ten-
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<PAGE>
dered Units and for distribution to Unit Holders of record as
of a date prior to the determination and then;
(3) by dividing the result of the above computation
by the total number of Units outstanding on the date of such
Evaluation. The resulting figure equals the Redemption Price
for each Unit.
The aggregate value of the Securities shall be deter-
mined by the Trustee in good faith in the following manner: If
the Securities are listed on one or more national securities
exchanges, such valuation shall be based on the closing price
on such Exchange which is the principal market thereof deemed
to be the New York Stock Exchange if the Securities are listed
thereon (unless the Trustee deems such price inappropriate as a
basis for valuation). If the Securities are not so listed, or,
if so listed and the principal market therefor is other than
such exchange or there is no closing price on such exchange,
such valuation shall be based on the closing price in the over-
the-counter market (unless the Trustee deems such price inap-
propriate as a basis for valuation) or if there is no such
closing price, by any of the following methods which the Trus-
tee deems appropriate: (i) on the basis of current bid prices
of such Securities as obtained from investment dealers or bro-
kers (including the Depositor) who customarily deal in securi-
ties comparable to those held by the Trust, or (ii) if bid
prices are not available for any of such Securities, on the ba-
sis of bid prices for comparable Securities, or (iii) by ap-
praisal of the value of the Securities on the bid side of the
market or by such other appraisal as is deemed appropriate, or
(iv) by any combination of the above.
Postponement of Redemption
The right of redemption may be suspended and payment
of the Redemption Price per Unit postponed for more than seven
calendar days following a tender of Units for redemption (i)
for any period during which the New York Stock Exchange, Inc.
is closed, other than for customary weekend and holiday clos-
ings, or (ii) for any period during which, as determined by the
Securities and Exchange Commission, either trading on the New
York Stock Exchange, Inc. is restricted or an emergency exists
as a result of which disposal or evaluation of the Securities
is not reasonably practicable, or (iii) for such other periods
as the Securities and Exchange Commission may by order permit.
The Trustee is not liable to any person or in any way for any
loss or damage that may result from any such suspension or
postponement.
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<PAGE>
RIGHTS OF UNIT HOLDERS
Unit Holders
A Unit Holder is deemed to be a beneficiary of the
Trust created by the Indenture and Agreement and vested with
all right, title and interest in the Trust created therein. A
Unit Holder may at any time tender its Certificate to the Trus-
tee for redemption.
Ownership of Units is evidenced by registered Cer-
tificates of Beneficial Interest issued in denominations of one
or more Units and executed by the Trustee and the Sponsor.
These Certificates are transferable or interchangeable upon
presentation at the unit investment trust office of the Trus-
tee, properly endorsed or accompanied by an instrument of
transfer satisfactory to the Trustee and executed by the Unit
Holder or its authorized attorney, together with the payment of
$2.00, if required by the Trustee, or such other amount as may
be determined by the Trustee and approved by the Sponsor, and
any other tax or governmental charge imposed upon the transfer
of Certificates. The Trustee will replace any mutilated, lost,
stolen or destroyed Certificate upon proper identification,
satisfactory indemnity and payment of charges incurred. Any
mutilated Certificate must be presented to the Trustee before
any substitute Certificate will be issued.
Under the terms and conditions and at such times as
are permitted by the Trustee, Units may also be held in uncer-
tificated form. The rights of any holder of Units held in un-
certificated form shall be the same as those of any other Unit
Holder.
Certain Limitations
The death or incapacity of any Unit Holder (or the
dissolution of the Sponsor) will not operate to terminate the
Trust nor entitle the legal representatives or heirs of such
Unit Holder to claim an accounting or to take any other action
or proceeding in any court for a partition or winding-up of the
Trust.
No Unit Holder shall have the right to vote except
with respect to removal of the Trustee or amendment and termi-
nation of the Trust (see: "Administration of the Trust --
Amendment" and "Administration of the Trust -- Termination",
herein). Unit Holders shall have no right to control the op-
eration or administration of the Trust in any manner, except
upon the vote of 51% of the Unit Holders outstanding at any
time for purposes of amendment, or termination of the Trust or
discharge of the Trustee, all as provided in the Agreement;
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<PAGE>
however, no Unit Holder shall ever be under any liability to
any third party for any action taken by the Trustee or Sponsor.
Unit Holders will be unable to dispose of any of the Securities
in the Portfolio, as such, and will not be able to vote the Se-
curities. The Trustee, as holder of the Securities, will have
the right to vote all of the voting Securities held in the
Trust, and will vote such Securities in accordance with the in-
structions of the Sponsor, if given, otherwise the Trustee
shall vote as it, in its sole discretion, shall determine.
EXPENSES AND CHARGES
Fees
The Sponsor's fee, earned for portfolio supervisory
services, is based upon the largest number of Units outstanding
during the computation period. The Sponsor's fee, as set forth
under "Summary of Essential Information", may exceed the actual
costs of providing portfolio supervisory services for this
Trust, but at no time will the total amount the Sponsor re-
ceives for portfolio supervisory services rendered to all se-
ries of the Morgan Stanley Dean Witter Select Equity Trust in
any calendar year exceed the aggregate cost to it of supplying
such services in such year.
Under the Indenture and Agreement for its services as
Trustee, the Trustee receives the fee set forth under "Summary
of Essential Information". Certain regular expenses of the
Trust, including certain mailing and printing expenses, are
borne by the Trust.
The Sponsor's fee and the Trustee's fees accrue daily
but are payable only on or before each Distribution Date from
the Income Account, to the extent funds are available and
thereafter from the Principal Account. Any of such fees may be
increased without approval of the Unit Holders in proportion to
increases under the classification "All Services Less Rent" in
the Consumer Price Index published by the United States Depart-
ment of Labor or, if no longer published, a similar index. The
Trustee, pursuant to normal banking procedures, also receives
benefits to the extent that it holds funds on deposit in vari-
ous non-interest bearing accounts created under the Indenture
and Agreement.
Other Charges
The following additional charges are or may be in-
curred by the Trust as more fully described in the Indenture
and Agreement: (a) fees of the Trustee for extraordinary serv-
ices, (b) expenses of the Trustee (including legal and auditing
expenses) and of counsel designated by the Sponsor, (c) various
26
<PAGE>
governmental charges, (d) expenses and costs of any action
taken by the Trustee to protect the Trust and the rights and
interests of the Unit Holders, (e) indemnification of the Trus-
tee for any loss, liability or expenses incurred by it in the
administration of the Trust without gross negligence, bad
faith, wilful malfeasance or wilful misconduct on its part or
reckless disregard of its obligations and duties, (f) indemni-
fication of the Sponsor for any losses, liabilities and ex-
penses incurred in acting as Sponsor or Depositor under the
Agreement without gross negligence, bad faith, wilful malfea-
sance or wilful misconduct or reckless disregard of its obli-
gations and duties, (g) expenditures incurred in contacting
Unit Holders upon termination of the Trust, (h) brokerage com-
missions or charges incurred in connection with the purchase or
sale of Securities and (i) to the extent lawful, expenses
(including legal, auditing and printing expenses) of maintain-
ing registration or qualification of the Units and/or the Trust
under Federal or state securities laws so long as the Sponsor
is maintaining a market for the Units. The accounts of the
Trust shall be audited not less frequently than annually by in-
dependent certified public accountants designated by the Spon-
sor, and the report of such accountants will be furnished by
the Trustee to Unit Holders upon request. The cost of such
audit shall be an expense of the Trust.
The fees and expenses set forth herein are payable
out of the Trust and when so paid by or owing to the Trustee
are secured by a lien on the Trust. Dividends on the Securi-
ties are expected to be sufficient to pay the estimated ex-
penses of the Trust. If the balances in the Income and Princi-
pal Accounts are insufficient to provide for amounts payable by
the Trust, the Trustee has the power to sell Securities to pay
such amounts. To the extent Securities are sold, the size of
the Trust will be reduced and the proportions of the types of
Securities may change. Such sales might be required at a time
when Securities would not otherwise be sold and might result in
lower prices than might otherwise be realized. Moreover, due
to the minimum lot size in which Securities may be required to
be sold, the proceeds of such sales may exceed the amount nec-
essary for the payment of such fees and expenses.
ADMINISTRATION OF THE TRUST
Records and Accounts
The Trustee will keep records and accounts of all
transactions of the Trust at its unit investment trust office
at 101 Barclay Street, New York, New York 10286. These records
and accounts will be available for inspection by Unit Holders
at reasonable times during normal business hours. The Trustee
will additionally keep on file for inspection by Unit Holders
27
<PAGE>
an executed copy of the Indenture and Agreement together with a
current list of the Securities then held in the Trust. In con-
nection with the storage and handling of certain Securities de-
posited in the Trust, the Trustee is authorized to use the
services of Depository Trust Company. These services would in-
clude safekeeping of the Securities, computer book-entry trans-
fer and institutional delivery services. The Depository Trust
Company is a limited purpose trust company organized under the
Banking Law of the State of New York, a member of the Federal
Reserve System and a clearing agency registered under the Secu-
rities Exchange Act of 1934.
Distribution
Dividends payable to the Trust as a holder of record
of its Securities are credited by the Trustee to an Income Ac-
count, as of the date on which the Trust is entitled to receive
such dividends. Other receipts such as return of principal and
gain and including amounts received upon the sale, pursuant to
the Indenture and Agreement, of rights to purchase other Secu-
rities distributed in respect of the Securities in the Portfo-
lio, are credited to a Principal Account. A distribution to a
Unit Holder as of a Record Date will be made on the following
Distribution Date or shortly thereafter and shall consist of
such Holder's pro rata share of the distributable cash balance
of the Income Account and Principal Account. Proceeds received
from the disposition of any of the Securities which are not
used for redemption of Units or for the purchase of substitute
Securities will be held in the Principal Account to be distrib-
uted on the Distribution Date following receipt of such pro-
ceeds. No distribution need be made from the Principal Account
if the balance therein is less than $1.00 per 1,000 Units out-
standing. A Reserve Account may be created by the Trustee by
withdrawing from the Income or Principal Accounts, from time to
time, such amounts as it deems requisite to establish a reserve
for any taxes or other governmental charges that may be payable
out of the Trust. Funds held by the Trustee in the various ac-
counts created under the Indenture are non-interest bearing to
Unit Holders.
Portfolio Supervision
The original proportionate relationship between the
number of shares of each Security in the Trust will be adjusted
to reflect the occurrence of a stock dividend, a stock split,
merger, reorganization or a similar event which affects the
capital structure of the issuer of a Security in the Trust but
which does not affect the Trust's percentage ownership of the
common stock equity of such issuer at the time of such event.
If the Trust receives the securities of another issuer as the
result of a merger or reorganization of, or a spin-off, split-
28
<PAGE>
off or split-up by the issuer of a Security included in the
original portfolio, the Trust may hold those securities as if
they were one of the Securities initially deposited and adjust
the proportionate relationship accordingly for all future sub-
sequent deposits.
The Portfolio of the Trust is not "managed" by the
Sponsor or the Trustee; their activities described below are
governed solely by the provisions of the Indenture and Agree-
ment. The Sponsor may direct the Trustee to dispose of Securi-
ties upon failure of the issuer of a Security in the Trust to
declare or pay anticipated cash dividends, institution of cer-
tain materially adverse legal proceedings, default under cer-
tain documents materially and adversely affecting future decla-
ration or payment of dividends, the occurrence of other market
or credit factors that in the opinion of the Sponsor would make
the retention of such Securities in the Trust detrimental to
the interests of the Unit Holders or if the disposition of such
Securities is desirable in order to maintain the qualification
of the Trust as a regulated investment company under the Code.
If a failure to declare or pay cash dividends on any of the Se-
curities occurs and if the Sponsor does not, within 30 days af-
ter notification, instruct the Trustee to sell or hold such Se-
curities, the Indenture provides that the Trustee shall
promptly sell such Securities. An offer to purchase a Security
in the Portfolio of the Trust may be accepted or rejected, or
such security may be sold on the market.
The Sponsor is authorized to instruct the Trustee to
reinvest the proceeds of the redemption or sale of any of the
Securities in substitute Securities. Moneys held in the Trust
to cover the purchase of Securities pursuant to contracts which
have failed, may be also reinvested in substitute Securities.
The substitute Securities must satisfy certain conditions
specified in the Indenture including requirements that the sub-
stitute securities shall be selected by the Sponsor from a list
of securities maintained by it, and updated from time to time,
and that the Securities shall have, in the opinion of the Spon-
sor, characteristics sufficiently similar to the characteris-
tics of the other Securities in the Trust as to be acceptable
for acquisition by the Trust. The purchase price thereof may
not exceed the amount of funds reserved for the purchase of Se-
curities by the Trustee.
During the life of the Trust, the Sponsor, as part of
its administrative responsibilities, shall conduct reviews to
determine whether or not to recommend the disposition of Secu-
rities. In addition, the Sponsor shall undertake to perform
such other reviews and procedures as it may deem necessary in
order for it to give the consents and directions, including di-
rections as to voting on the underlying Securities, required by
29
<PAGE>
the Indenture and Agreement. For the administrative services
performed in making such recommendations and giving such con-
sents and directions, and in making the reviews called for in
connection therewith the Sponsor shall receive the portfolio
supervisory fee referred to under "Summary of Essential Infor-
mation".
Voting of the Portfolio Securities
Pursuant to the Indenture and Agreement, voting
rights with respect to the Portfolio Securities and Replacement
Securities, if any, will be exercised by the Trustee in accor-
dance with the directions given by the Sponsor.
Reports to Unit Holders
With each distribution, the Trustee will furnish to
Unit Holders a statement of the amount of income and other re-
ceipts distributed, including the proceeds of the sale of the
Securities, expressed in each case as a dollar amount per Unit.
Within a reasonable period of time after the last
business day in each calendar year, but not later than February
15, the Trustee will furnish to each person who at any time
during such calendar year was a Unit Holder of record a state-
ment setting forth:
1. As to the Income and Principal Accounts:
(a) the amount of income received on the Secu-
rities;
(b) the amount paid for redemption of Units;
(c) the deductions for applicable taxes or
other governmental charges, if any, and
fees and expenses of the Sponsor, the Trus-
tee and counsel;
(d) the amounts distributed from the Income Ac-
count;
(e) any other amount credited or deducted from
the Income Account; and
(f) the net amount remaining after such pay-
ments and deductions expressed both as a
total dollar amount and as a dollar amount
per Unit outstanding on the last business
day of such calendar year.
30
<PAGE>
2. The following information:
(a) a list of the Securities as of the last
business day of such calendar year;
(b) the number of Units outstanding as of the
last business day of such calendar year;
(c) the Unit Value (as defined in the Agree-
ment) based on the last Evaluation made
during such calendar year; and
(d) the amounts actually distributed during
such calendar year from the Income and
Principal Accounts, separately stated, ex-
pressed both as total dollar amounts and as
dollar amounts per Unit outstanding on the
Record Dates for such distributions.
Amendment
The Indenture and Agreement may be amended from time
to time by the Trustee and the Sponsor or their respective suc-
cessors, without the consent of any of the Unit Holders (a) to
cure any ambiguity or to correct or supplement any provision
contained therein which may be defective or inconsistent with
any other provision contained therein; (b) to change any provi-
sion thereof as may be required by the Securities and Exchange
Commission or any successor governmental agency exercising
similar authority; (c) to add or change any provision as may be
necessary or advisable for the continuing qualification of the
Trust as a regulated investment company under the Code or to
prevent the applicability of the 4% excise tax imposed by Sec-
tion 4982 of the Code; or (d) to make such other provision in
regard to matters or questions arising thereunder as shall not
adversely affect the interest of the Unit Holders; provided,
that the Indenture and Agreement may also be amended from time
to time by the parties thereto (or the performance of any of
the provisions of this Indenture may be waived) with the ex-
pressed written consent of Unit Holders evidencing 51% of the
Units at the time outstanding under the Indenture for the pur-
pose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Indenture and Agree-
ment or of modifying in any manner the rights of the Unit Hold-
ers; provided, further, however, that the Indenture and Agree-
ment may not be amended (nor may any provision thereof be
waived) so as to (1) increase the number of Units issuable in
respect of the Trust above the aggregate number specified in
Part II of the Reference Trust Agreement or such lesser amount
31
<PAGE>
as may be outstanding at any time during the term of the Inden-
ture, except as the result of the deposit of Additional Securi-
ties, as therein provided, or reduce the relative interest in
the Trust of any Unit Holder without his consent, or (2) permit
the deposit or acquisition thereunder of securities or other
property either in addition to or in substitution for any of
the Securities except in the manner permitted by the Trust In-
denture as in effect on the date of the first deposit of Secu-
rities or permit the Trustee to engage in business or invest-
ment activities not specifically authorized in the Indenture
and Agreement as originally adopted.
Termination
The Indenture and Agreement provides that the Trust
will be liquidated during the Liquidation Period as set forth
under "Summary of Essential Information", herein, and termi-
nated at the end of such period. Additionally, if the value of
the Trust as shown by any Evaluation is less than forty percent
(40%) of the value of the Securities deposited in the Trust on
the Date of Deposit and thereafter, the Trustee will, if di-
rected by the Sponsor in writing, terminate the Trust. The
Trust may also be terminated at any time by the written consent
of Unit Holders owning 50% or more of the Units then outstand-
ing. Unit Holders will receive their final distributions (that
is, their pro rata distributions realized from the sale of
Portfolio Securities plus any other Trust assets, less Trust
expenses) according to their Election Instructions. The Elec-
tion Instructions will provide for the following distribution
options: (1) cash distributions; or (2) distributions "in
kind" available only to any Unit Holder owning at least 25,000
Units. Unit Holders who do not tender properly completed Elec-
tion Instructions to the Trustee will be deemed to have elected
a cash distribution.
Cash or "In Kind" Distributions. Unit Holders hold-
ing less than 25,000 Units will receive distributions in re-
spect of their Units at termination solely in cash. Unit Hold-
ers holding at least 25,000 Units may indicate to the Trustee
that they wish to receive termination distributions "in kind",
by returning to the Trustee properly completed Election In-
structions distributed by the Trustee to such Unit Holders of
record 45 days prior to the Termination Date. The Trustee will
duly honor such election instructions received on or before the
In-Kind Distribution Date. Such Unit Holder will be entitled
to receive whole shares of each of the underlying Portfolio Se-
curities and cash from the Principal Account equal to the frac-
tional shares to which such tendering Unit Holder is entitled.
A Unit Holder receiving distributions of Securities "in kind"
may incur brokerage costs in converting Securities so received
into cash. The Trustee will transfer the Securities to be de-
32
<PAGE>
livered "in kind" to the account of, and for disposition in ac-
cordance with the instructions of, the Unit Holder.
Method of Securities Disposal. The Trustee will be-
gin to sell the remaining Securities held in the Trust on the
next business day following the In-Kind Distribution Date.
Since the Trust is not managed, Securities in the Portfolio
must be sold in accordance with the Indenture, which provides
for sales over a period of days or on any one day during the
Liquidation Period set forth in the "Summary of Essential In-
formation". Daily proceeds of such sales will be deposited
into the Trust, will be held in a non-interest bearing account
until distributed and will be of benefit to the Trustee. The
sales of Portfolio Securities may tend to depress the market
prices for such Securities and thus reduce the proceeds avail-
able to Unit Holders. The Sponsor believes that gradual liqui-
dation of Securities during the Liquidation Period may miti-
gate negative market price consequences stemming from the trad-
ing of large volumes of Securities over a short period of time.
There can be no assurance, however, that such procedures will
effectively mitigate any adverse price consequences of heavy
volume trading or that such procedures will produce a better
price for Unit Holders than might have been obtained had all
the Securities been sold on one particular day during the Liq-
uidation Period.
The Trustee will, after deduction of brokerage
charges and costs incurred in connection with the sale of Secu-
rities, any fees and expenses of the Trust and payment into the
Reserve Account of any amount required for taxes or other gov-
ernmental charges that may be payable by the Trust, distribute
to each Unit Holder, upon surrender for cancellation of its
Certificate after due notice of such termination, such Unit
Holder's pro rata share in the Income and Principal Accounts.
The sale of Securities in the Trust upon termination may result
in a lower amount than might otherwise be realized if such sale
were not required at such time. For this reason, among others,
the amount realized by a Unit Holder upon termination may be
less than the amount paid by such Unit Holder for Units.
RESIGNATION, REMOVAL AND LIABILITY
Regarding the Trustee
The Trustee shall be under no liability for any ac-
tion taken in good faith in reliance on prima facie properly
executed documents or for the disposition of monies or Securi-
ties in the Trust, nor shall the Trustee be liable or responsi-
ble in any way for depreciation or loss incurred by reason of
the disposition of any Securities by the Trustee. However, the
Trustee shall be liable for wilful misfeasance, bad faith or
33
<PAGE>
gross negligence in the performance of its duties or by reason
of its reckless disregard of its obligations and duties under
the Indenture and Agreement. In the event of a failure of the
Sponsor to act, the Trustee may act under the Indenture and
Agreement and shall not be liable for any such action taken by
it in good faith. The Trustee shall not be personally liable
for any taxes or other governmental charges imposed upon the
Trust or in respect of the Securities or the interest thereon.
The Indenture and Agreement also contain other customary provi-
sions limiting the liability of the Trustee and providing for
the indemnification of the Trustee for any loss or claim accru-
ing to it without gross negligence, bad faith, wilful miscon-
duct, wilful misfeasance or reckless disregard of its duties
and obligations under the Agreement on its part.
The Trustee or any successor may resign by executing
an instrument in writing, filing the same with the Sponsor and
mailing a copy of such notice of resignation to all Unit Hold-
ers then of record. Upon receiving such notice the Sponsor
will use its best efforts to appoint a successor Trustee
promptly. If the Trustee becomes incapable of acting or be-
comes bankrupt or its affairs are taken over by public authori-
ties, or if the Trustee has materially failed to perform its
duties under the Indenture and Agreement and the interest of
the Unit Holders has been impaired as a result, the Sponsor may
remove the Trustee and appoint a successor as provided in the
Agreement. If within 30 days of the resignation of a Trustee
no successor has been appointed or, if appointed, has not ac-
cepted the appointment, the retiring Trustee may apply to a
court of competent jurisdiction for the appointment of a suc-
cessor. The resignation or removal of a Trustee becomes effec-
tive only when the successor Trustee accepts its appointment as
such or when a court of competent jurisdiction appoints a suc-
cessor Trustee.
Regarding the Sponsor
The Sponsor shall be under no liability to the Trust
or to Unit Holders for taking any action or for refraining from
any action in good faith or for errors in judgment. Nor shall
the Sponsor be liable or responsible in any way for deprecia-
tion or loss incurred by reason of the disposition of any Secu-
rity. The Sponsor will, however, be liable for its own wilful
misfeasance, wilful misconduct, bad faith, gross negligence or
reckless disregard of its duties and obligations under the
Agreement.
If at any time the Sponsor shall resign under the
Agreement or shall fail or be incapable of performing its du-
ties thereunder or shall become bankrupt or its affairs are
taken over by public authorities, the Agreement directs the
34
<PAGE>
Trustee to either (1) appoint a successor Sponsor or Sponsors
at rates of compensation deemed reasonable by the Trustee not
exceeding amounts prescribed by the Securities and Exchange
Commission, or (2) terminate the Trust Indenture and Agreement
and the Trust and liquidate the Trust. The Trustee will
promptly notify Unit Holders of any such action.
MISCELLANEOUS
Sponsor
Dean Witter Reynolds Inc. ("Dean Witter") is a corpo-
ration organized under the laws of the State of Delaware and
is a principal operating subsidiary of Morgan Stanley Dean Wit-
ter & Co. (MSDW), a publicly-held corporation. On May 31,
1997, Dean Witter, Discover & Co., Dean Witter's former parent
company, and Morgan Stanley Group Inc. merged to form MSDW.
Dean Witter is a financial services company that provides to
its individual, corporate, and institutional clients services
as a broker in securities and commodities, a dealer in corpo-
rate, municipal, and government securities, an investment
banker, an investment adviser, and an agent in the sale of life
insurance and various other products and services. Dean Witter
is a member firm of the New York Stock Exchange, the American
Stock Exchange, other major securities exchanges and the Na-
tional Association of Securities Dealers. Dean Witter is cur-
rently servicing its clients through a network of approximately
350 domestic and international offices with approximately
10,000 account executives servicing individual and institu-
tional client accounts.
Trustee
The Trustee is The Bank of New York with its princi-
pal place of business at 48 Wall Street, New York, New York
10286 and its unit investment trust office at 101 Barclay
Street, New York, New York 10286. The Trustee is organized un-
der the laws of the State of New York, is a member of the New
York Clearing House Association and is subject to supervision
and examination by the Superintendent of Banks of the State of
New York, the Federal Deposit Insurance Corporation and the
Board of Governors of the Federal Reserve System. Unit Holders
should direct inquiries regarding distributions, address
changes and other matters relating to the administration of the
Trust to the Trustee at Unit Investment Trust Division, P.O.
Box 974, Wall Street Station, New York, New York 10268-0974.
Legal Opinions
The legality of the Units offered hereby has been
passed upon by Cahill Gordon & Reindel, a partnership including
35
<PAGE>
a professional corporation, 80 Pine Street, New York, New York
10005, as special counsel for the Sponsor.
AUDITORS
The Statement of Financial Condition and Schedule of
Portfolio Securities of this series of the Morgan Stanley Dean
Witter Select Equity Trust included in this Prospectus have
been audited by Deloitte & Touche LLP, certified public ac-
countants, as stated in their report as set forth in this Pro-
spectus, and are included in reliance upon such report given
upon the authority of that firm as experts in accounting and
auditing.
36
<PAGE>
<AUDIT-REPORT>
INDEPENDENT AUDITORS' REPORT
THE UNIT HOLDERS, SPONSOR AND TRUSTEE
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
We have audited the statement of financial condition and schedule of
portfolio securities of the Morgan Stanley Dean Witter Select Equity Trust
Bank Stock Portfolio Series 2 as of August 31, 1998, and the related
statements of operations and changes in net assets for the three years in
the period then ended. These financial statements are the responsibility of
the Trustee (see Footnote (a)(1)). Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
Our procedures included confirmation of the securities owned as of
August 31, 1998 as shown in the statement of financial condition and
schedule of portfolio securities by correspondence with The Bank of New
York, the Trustee. An audit also includes assessing the accounting
principles used and the significant estimates made by the Trustee, as well
as evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of the Morgan Stanley Dean
Witter Select Equity Trust Bank Stock Portfolio Series 2 as of August 31,
1998, and the results of its operations and the changes in its net assets
for the three years in the period then ended in conformity with generally
accepted accounting principles.
DELOITTE & TOUCHE LLP
October 19, 1998
New York, New York
F-1
</AUDIT-REPORT>
<PAGE>
STATEMENT OF FINANCIAL CONDITION
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
August 31, 1998
TRUST PROPERTY
Investments in Securities at market value(cost
$37,835,346) (Note (a) and Schedule of Portfolio
Securities Notes (1) and (2)) $68,763,021
Accrued dividend receivable 141,011
Receivable from Broker 6,328,830
Cash 424,169
Total 75,657,031
LIABILITIES AND NET ASSETS
Less Liabilities:
Payable to Unit Holders 6,876,792
Accrued Trustee's fees and expenses 36,253
Total liabilities 6,913,045
Net Assets:
Balance applicable to 39,842,761 Units of
fractional undivided interest outstanding
(Note (c)):
Capital, plus net unrealized market
appreciation of $30,927,675 $68,763,021
Overdistributed principal and net
investment income (Note (b)) (19,035)
Net assets $68,743,986
Net asset value per Unit ($68,743,986 divided by
39,842,761 Units) $ 1.7254
See notes to financial statements
F-2
<PAGE>
STATEMENTS OF OPERATIONS
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
For the years ended August 31,
1998 1997 1996
Investment income - dividends $ 2,087,799 $ 2,268,635 $ 2,466,371
Less Expenses:
Trustee's fees and expenses 78,767 87,156 76,496
Sponsor's fees 10,867 11,704 13,133
Total expenses 89,634 98,860 89,629
Investment income -
net 1,998,165 2,169,775 2,376,742
Net gain (loss) on investments:
Realized gain on securities
sold or redeemed 17,594,856 8,494,836 3,902,629
Unrealized market (deprecia-
tion) appreciation (12,330,896) 25,791,560 10,546,892
Net gain on investments 5,263,960 34,286,396 14,449,521
Net increase in net assets
resulting from operations $ 7,262,125 $36,456,171 $16,826,263
See notes to financial statements
F-3
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
MORGAN STANLDY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
For the years ended August 31,
1998 1997 1996
Operations:
Investment income - net $ 1,998,165 $ 2,169,775 $ 2,376,742
Realized gain on securities
sold or redeemed 17,594,856 8,494,836 3,902,629
Unrealized market (deprecia-
tion) appreciation (12,330,896) 25,791,560 10,546,892
Net increase in net
assets resulting
from operations 7,262,125 36,456,171 16,826,263
Less Distributions to Unit Holders:
Principal (13,483,030) (10,680,561) -
Investment income - net (2,464,870) (2,136,088) (2,224,460)
Total distributions (15,947,900) (12,816,649) (2,224,460)
Less Capital Share Transactions:
Creation of 3,500,000 Units,
4,750,000 Units and
22,500,000 Units, respectively 7,579,724 8,109,326 27,820,671
Redemption of 9,222,379 Units,
5,874,349 Units and
14,560,432 Units, respec-
tively (20,174,245) (10,319,056) (19,707,551)
Accrued dividend on redemption (52,168) (44,113) (97,511)
Total capital share
transactions (12,646,689) (2,253,843) 8,015,609
Net (decrease) increase in net
assets (21,332,464) 21,385,679 22,617,412
Net assets:
Beginning of year 90,076,450 68,690,771 46,073,359
End of year (including overdis-
tributed principal and net
investment income of
$(19,035), and undistributed
principal and net investment
income of $549,282 and
$560,867, respectively) $68,743,986 $90,076,450 $68,690,771
See notes to financial statements
F-4
<PAGE>
NOTES TO FINANCIAL STATEMENTS
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
August 31, 1998
(a) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Trust is registered under the Investment Company Act of 1940 as a
Unit Investment Trust. The following is a summary of the significant
accounting policies of the Trust:
(1) Basis of Presentation
The Trustee has custody of and responsibility for all accounting
and financial books, records, financial statements and related data
of the Trust and is responsible for establishing and maintaining a
system of internal controls directly related to, and designed to
provide reasonable assurance as to the integrity and reliability
of, financial reporting of the Trust. The Trustee is also
responsible for all estimates and accruals reflected in the Trust's
financial statements. Under the Securities Act of 1933 ("the
Act"), as amended, the Sponsor is deemed to be an issuer of the
Trust Units. As such, the Sponsor has the responsibility of an
issuer under the Act with respect to financial statements of the
Trust included in the Trust's Registration Statement under the Act
and amendments thereto.
(2) Investments
Investments are stated at market value as determined by the
Trustee, based on the closing price on the New York Stock Exchange
or the closing sale price on the over-the-counter market, on the
last day of trading during the period. The value on the date of
initial deposit (September 27, 1994) represents the cost of
investments to the Trust based on the closing sale price on the New
York Stock Exchange or the closing sale price on the over-the-
counter market. The cost of investments purchased subsequent to
the date of initial deposit is based on the closing sale price on
the New York Stock Exchange or the over-the-counter market on the
date of purchase.
(3) Income Taxes
No provision for Federal income taxes has been made in the
accompanying financial statements because the Trust has elected and
intends to continue to qualify for the tax treatment applicable to
"Regulated Investment Companies" under the Internal Revenue Code.
Under existing law, if the Trust so qualifies, it will not be
subject to Federal income tax on net income and capital gains that
are distributed to Unit Holders.
(4) Expenses
The Trust pays annual Trustee's fees, estimated expenses,
Evaluator's fees, and annual Sponsor's portfolio supervision fees
and may incur additional charges as explained under "Expenses and
Charges - Fees" and "- Other Charges" in this Prospectus.
F-5
<PAGE>
NOTES TO FINANCIAL STATEMENTS
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
August 31, 1998
(b) DISTRIBUTIONS
Distributions of dividend income and principal, if any, received by the
Trust are made to Unit Holders on a quarterly basis and distributions of
net realized capital gains, if any, will be made annually, within 30
days after the end of the Trust's taxable year to Unit Holders of
record. Record Dates are the first day of March, June, September and
December and Distribution Dates are the fifteenth days of such months
(or shortly thereafter). Upon termination of the Trust, the Trustee
will distribute to each Unit Holder his pro rata share of the Trust's
assets, less expenses. (See: "Administration of the Trust -
Termination" in this Prospectus.)
(c) ORIGINAL COST TO INVESTORS
The original cost to investors represents the aggregate initial public
offering price as of the date of deposit (September 27, 1994), computed
on the basis set forth under "Public Offering of Units - Public Offering
Price" in this Prospectus.
A reconciliation of the original cost of Units to investors to the net
amount applicable to investors as of August 31, 1998 follows:
Original cost to investors $ 243,492
Less: Gross underwriting commissions (sales charge) (10,349)
Net cost to investors 233,143
Cost to investors of Units created during deposit
period 81,943,824
Net unrealized market appreciation 30,927,675
Cost of securities sold or redeemed (44,341,621)
Net amount applicable to investors $68,763,021
F-6
<PAGE>
NOTES TO FINANCIAL STATEMENTS
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
August 31, 1998
(d) OTHER INFORMATION
Selected data for a Unit of the Trust during each year:
For the years ended August 31,
1998 1997 1996
Principal distributions
during year $ .3246 $ .2347 $ -
Net investment income dis-
tribution during year $ .0577 $ .0459 $ .0441
Net asset value at end of
year $1.7254 $1.9769 $1.4712
Trust Units outstanding
at end of year 39,842,761 45,565,140 46,689,489
F-7
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE OF PORTFOLIO SECURITIES
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
August 31, 1998
Percentage
Port- Price Per of Aggregate Market
folio Number of Share to Market Value Value
No. Symbol Name of Issuer Shares Trust of Trust <F1><F2>
<S> <C> <C> <C> <C> <C>
1. ASO AmSouth Bancorporation <F5> 56,097 $ 34.3750 2.804% $ 1,928,335
2. BKB Bank of Boston <F5> 57,484 35.6875 2.983 2,051,461
3. BK The Bank of New York Company, Inc. <F3><F5> 100,717 24.1875 3.543 2,436,092
4. BAC BankAmerica Corporation <F6> 33,720 64.0625 3.141 2,160,188
5. BT Bankers Trust Corp. (formerly
Bankers Trust New York Corporation) 11,764 74.3125 1.271 874,213
6. COF Capital One Financial Corp. 21,617 87.5000 2.751 1,891,488
7. CMB Chase Manhattan Corp. <F5> 89,444 53.0000 6.894 4,740,532
8. CMA Comerica Incorporated <F5> 41,173 52.2500 3.129 2,151,289
9. CBSH Commerce Bancshares, Inc. <F4><F5> 45,095 40.0000 2.623 1,803,800
10. CBSS Compass Bancshares, Inc. <F4> 49,452 33.0000 2.373 1,631,916
11. FCN First Chicago NBD Corp. 26,957 63.3750 2.484 1,708,400
12. FTEN First Tennessee National Corporation <F4><F5> 68,440 23.8125 2.370 1,629,728
13. FTU First Union Corp. <F5> 154,189 48.5000 10.875 7,478,167
14. FVB First Virginia Banks, Inc. <F5>. 30,396 43.0000 1.901 1,307,028
15. FLT Fleet Financial Group 20,552 65.5625 1.960 1,347,441
16. JPM J.P. Morgan 12,709 93.0000 1.719 1,181,937
17. KEY KeyCorp. <F5> 50,386 25.5000 1.869 1,284,843
18. MEL Mellon Bank 40,399 52.0000 3.055 2,100,748
19. NCC National City Corp. <F5> 101,033 58.7500 8.632 5,935,689
20. NB NationsBank Corp.<F5><F6> 107,253 57.0000 8.891 6,113,421
21. NOB Norwest Corporation <F5><F7> 60,342 29.7500 2.611 1,795,175
22. OKEN Old Kent Financial <F4><F5> 58,292 32.2500 2.734 1,879,917
23. BOH Pacific Century Financial Corp. <F5> 50,635 14.7500 1.086 746,866
24. PNC PNC Bank Corp. 29,341 43.0000 1.835 1,261,663
25. SOTR SouthTrust Corporation <F4><F5> 58,444 32.3750 2.752 1,892,125
26. STB Star Banc Corp. <F5> 55,976 54.8750 4.467 3,071,683
27. WFC Wells Fargo & Co. <F7> 6,262 281.8750 2.567 1,765,113
28. ZION Zions Bancorporation <F4><F5> 79,395 38.3750 4.431 3,046,783
29. ONE Banc One <F5> 40,710 38.0000 2.250 1,546,980
$68,763,021
See notes to schedule of portfolio securitie
F-8
</TABLE>
<PAGE>
NOTES TO SCHEDULE OF PORTFOLIO SECURITIES
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
August 31, 1998
(F1) Valuation of Securities by the Trustee was made on the basis of the
closing sale price on the New York Stock Exchange or the closing
sale price on the over-the-counter market as of August 31, 1998.
(F2) At August 31, 1998, the net unrealized market appreciation of all
Securities was comprised of the following:
Gross unrealized market appreciation $31,029,532
Gross unrealized market depreciation (101,857)
Net unrealized market appreciation $30,927,675
The aggregate cost of the Securities for Federal income tax
purposes was $37,835,346 at August 31, 1998.
(F3) Dean Witter Reynolds Inc. was manager or co-manager of an offering
of Securities of this company within the past three years.
(F4) Dean Witter Reynolds Inc. makes a market in this Security.
(F5) A three-for-two stock split for AmSouth BanCorporation was declared
on March 19, 1998 for stockholders of record on April 3, 1998.
A two-for-one stock split for Bank of Boston was declared on
April 23, 1998 for stockholders of record on June 1, 1998.
A two-for-one stock split for The Bank of New York was declared on
July 14, 1998 for stockholders of record on July 24, 1998.
A two-for-one stock split for Chase Manhattan Corporation was
declared on March 17, 1998 for stockholders of record on May 20,
1998.
A three-for-two stock split for Comercia Incorporated was declared
on January 15, 1998 for stockholders of record on March 15, 1998.
A five percent stock dividend for Commerce Bancshares, Inc. was
declared on October 3, 1997 for stockholders of record on
November 28, 1997.
A three-for-two stock split for Commerce Bancshares, Inc. was
declared on February 6, 1998 for stockholders of record on March 9,
1998.
A two-for-one stock split for First Tennessee National Corporation
was declared on January 20, 1998 for stockholders of record on
February 6, 1998.
Signet Banking Corporation merged into First Union Corp. on
December 1, 1997, the effective date. Stockholders received 1.1
shares of First Union Corp. for one share of Signet Banking
Corporation held.
F-9
<PAGE>
NOTES TO SCHEDULE OF PORTFOLIO SECURITIES
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
August 31, 1998
(F5) (continued:)
CoreStates Financial Corporation merged into First Union Corp. on
April 28, 1998, the effective date. Stockholders received 1.62
shares of NationsBank Corp. for one share of CoreStates Financial
Corporation held.
A three-for-two stock split for First Virginia Banks, Inc. was
declared on July 23, 1997 for stockholders of record August 13,
1997.
A two-for-one stock split for KeyCorp was declared on January 15,
1998 for stockholders of record February 18, 1998.
First of America Bank Corporation merged into National City Corp.
on March 31, 1998, the effective date. Stockholders received 1.2
shares of National City Corp shares for one share of First of
America Bank Corporation held.
Barnett Banks Inc. merged into NationsBank Corp. on January 9,
1998, the effective date. Stockholders received 1.1875 shares of
NationsBank Corp. for one share of Barnett Banks, Inc. held.
A two-for-one stock split for Norwest Corporation was declared on
September 23, 1997 for stockholders of record October 2, 1997.
A two-for-one stock split for Old Kent Financial Corporation was
declared on October 20, 1997 for stockholders of record
November 14, 1997.
A five percent stock dividend for Old Kent Financial Corporation
was declared on June 15, 1998 for stockholders of record June 26,
1998.
A two-for-one stock split for Pacific Century Financial Corporation
was declared on October 24, 1997 for stockholders of record on
November 21, 1997.
A three-for-two stock split for SouthTrust Corporation was declared
on January 29, 1998 for stockholders of record February 13, 1998.
Great Financial Corp. merged into Star Banc Corporation, effective
February 6, 1998. There were numerous stock elections of cash
and/or Star Banc Corporation common.
First Commerce Corporation merged into Bank One Corporation on
June 12, 1998, the effective date. Stockholders received 1.408
shares of Bank One Corporation for one share of First Commerce
Corporation held.
Vectra Banking Corp. and FP Bancorp Inc. merged into Zions
Bancorporation on January 6, 1998 and May 26, 1998, respectively.
For each share of Vectra common and FP Bancorp, Inc. common .685
and.627 common shares of Zions Bancorporation were received
respectively.
F-10
<PAGE>
NOTES TO SCHEDULE OF PORTFOLIO SECURITIES
MORGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANK STOCK PORTFOLIO SERIES 2
August 31, 1998
(F6) Effective September 30, 1998, BankAmerica Corp. and NationsBank
Corp. have merged. One share of BankAmerica Corp. will be
exchanged for 1.1316 shares common of the new company, BankAmerica
Corp. (New). One share of NationsBank Corp. will be exchanged for
one share of common of BankAmerica Corp. (new).
Subsequent Event:
(F7) Effective November 2, 1998 Wells Fargo & Co. and Norwest
Corporation have merged. One common share of Wells Fargo & Co.
will be exchanged for 10 common shares of Norwest Corporation.
F-11
<PAGE>
CONTENTS OF REGISTRATION STATEMENT
This registration statement comprises the following docu-
ments:
The facing sheet.
The Cross Reference Sheet.
The Prospectus.
The signatures.
Consent of Independent Auditors; all other consents were
previously filed.
The following exhibits:
23. 1b. Consent of Independent Auditors.
27. Financial Data Schedule.
<PAGE>
CONSENT OF COUNSEL
The consent of counsel to the use of its name in the
Prospectus included in this Registration Statement is contained
in its opinion filed as Exhibit EX-5. to this Registration
Statement.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933, the registrant, Morgan Stanley Dean Witter Select Equity
Trust, Bank Stock Portfolio Series 2, certifies that it meets
all of the requirements for effectiveness of this Registration
Statement pursuant to Rule 485(b) under the Securities Act of
1933 and has duly caused this Post-Effective Amendment No. 4 to
the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New
York and State of New York on the 12th day of November, 1998.
MORGAN STANLEY DEAN WITTER SELECT
EQUITY TRUST,
BANK STOCK PORTFOLIO SERIES 2
(Registrant)
By: DEAN WITTER REYNOLDS INC.
(Depositor)
/s/Thomas Hines
Thomas Hines
Authorized Signatory
Pursuant to the requirements of the Securities Act of
1933, this Post-Effective Amendment No. 4 to the Registration
Statement has been signed on behalf of Dean Witter Reynolds
Inc., the Depositor, by the following person in the following
capacities and by the following persons who constitute a major-
ity of the Depositor's Board of Directors in The City of New
York and State of New York on this 12th day of November, 1998.
DEAN WITTER REYNOLDS INC.
Name Office
Philip J. Purcell Chairman and Chief )
Executive Officer )
and Director*32 )
By:/s/Thomas Hines
Thomas Hines
Attorney-in-fact*32
___________________
*32 Executed copies of the Powers of Attorney have been filed
with the Securities and Exchange Commission in connection
with Amendment No. 1 to the Registration Statement on Form
S-6 for File No. 333-10499.
<PAGE>
Name Office
Richard M. DeMartini Director*32
Robert J. Dwyer Director*32
Christine A. Edwards Director*32
James F. Higgins Director*32
Mitchell M. Merin Director*32
Stephen R. Miller Director*32
Richard F. Powers, III Director*32
Philip J. Purcell Director*32
Thomas C. Schneider Director*32
William B. Smith Director*32
___________________
*32 Executed copies of the Powers of Attorney have been filed
with the Securities and Exchange Commission in connection
with Amendment No. 1 to the Registration Statement on Form
S-6 for File No. 333-10499.
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. TITLE OF DOCUMENT
23. 1b. Consent of Deloitte & Touche LLP
27. Financial Data Schedule
<PAGE>
<PAGE>
Exhibit 23.1b.
CONSENT OF INDEPENDENT AUDITORS
We consent to the use of our report, dated October 19, 1998, accompanying
the financial statements of the Dean Witter Select Equity Trust Bank Stock
Portfolio Series 2 included herein and to the reference to our Firm as
experts under the heading "Auditors" in the prospectus which is a part of
this registration statement.
DELOITTE & TOUCHE LLP
November 12, 1998
New York, New York
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<LEGEND> THE SCHEDULE CONTAINS SUMMARY FINANCIAL
INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS FOR MORGAN STANLEY DEAN WITTER SELECT
EQUITY TRUST BANK STOCK PORTFOLIO
SERIES 2 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS
<RESTATED>
<SERIES>
<NAME> MARGAN STANLEY DEAN WITTER SELECT EQUITY TRUST
BANKSTOCK PORTFOLIO SERIES
<NUMBER> 2
<MULTIPLIER> 1
<FISCAL-YEAR-END> Aug-31-1998
<PERIOD-START> Sep-1-1997
<PERIOD-END> Aug-31-1998
<PERIOD-TYPE> YEAR
<INVESTMENTS-AT-COST> 37,835,346
<INVESTMENTS-AT-VALUE> 68,763,021
<RECEIVABLES> 6,469,841
<ASSETS-OTHER> 424,169
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 75,657,031
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 6,913,045
<TOTAL-LIABILITIES> 6,913,045
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 37,830,694
<SHARES-COMMON-STOCK> 39,842,761
<SHARES-COMMON-PRIOR> 45,565,140
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> (14,383)
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 30,927,675
<NET-ASSETS> 68,743,986
<DIVIDEND-INCOME> 2,087,799
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 89,634
<NET-INVESTMENT-INCOME> 1,998,165
<REALIZED-GAINS-CURRENT> 17,594,856
<APPREC-INCREASE-CURRENT> (12,330,896)
<NET-CHANGE-FROM-OPS> 7,262,125
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 2,464,870
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 13,483,030
<NUMBER-OF-SHARES-SOLD> 3,500,000
<NUMBER-OF-SHARES-REDEEMED> 9,222,379
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> (21,332,464)
<ACCUMULATED-NII-PRIOR> 538,009
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
<PAGE>
</TABLE>
