<PAGE>
Schedule 14A Information required in proxy statement.
Schedule 14A Information
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Preliminary Additional Materials
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.149-11(c) or
Section 240.14a-12
InterCapital Income Securities Inc. . . . . . . . . . . . . . .
(Name of Registrant as Specified in its Charter)
LouAnne McInnis . . . . . . . . . . . . . . . . . . . . . . . .
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (check the appropriate box):
[ X ] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(j)(1), or
14a-6(j)(2)
[ ] $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-6(j)(3)
[ ] Fee computed on table below per Exchange Act Rules
14a-6(j)(4) and 0-11.
1) Title of each class of securities to which transaction
applies:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2) Aggregate number of securities to which transaction applies:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
<PAGE>
4) Proposed maximum aggregate value of transaction:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Set forth the amount on which the filing fee is calculated and
state how it was determined.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing.
1) Amount Previously Paid.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2) Form, Schedule or Registration Statement No.:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3) Filing Party:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4) Date Filed:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
<PAGE>
INTERCAPITAL INCOME SECURITIES INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD DECEMBER 20, 1995
The Annual Meeting of Stockholders of INTERCAPITAL INCOME SECURITIES INC.
(the "Fund"), a Maryland corporation, will be held in the Conference Center,
Forty-Fourth Floor, 2 World Trade Center, New York, New York 10048, on
December 20, 1995, at 9:00 a.m., New York City time, for the following
purposes:
1. To elect ten (10) Directors to serve until the next Annual Meeting, or
until their successors shall have been elected and qualified;
2. To approve or disapprove the continuance of the Fund's currently
effective Investment Management Agreement with Dean Witter InterCapital Inc.;
3. To ratify or reject the selection of Price Waterhouse LLP as the Fund's
independent accountants for the fiscal year ending September 30, 1996; and
4. To transact such other business as may properly come before the Meeting
or any adjournments thereof.
Stockholders of record as of the close of business on October 26, 1995 are
entitled to notice of and to vote at the Meeting. If you cannot be present in
person, your management would greatly appreciate your filling in, signing and
returning the enclosed proxy promptly in the envelope provided for that
purpose.
In the event that the necessary quorum to transact business at the Meeting
or the vote required to approve or reject any proposal is not obtained, the
persons named as proxies may propose one or more adjournments of the Meeting
for a total of not more than 60 days in the aggregate to permit further
solicitation of proxies. Any such adjournment will require the affirmative
vote of the holders of a majority of the Fund's shares present in person or
by proxy at the meeting. The persons named as proxies will vote in favor of
such adjournment those proxies which they are entitled to vote in favor of
the proposal to approve continuance of the Investment Management Agreement
and will vote against any such adjournment those proxies required to be voted
against that proposal.
SHELDON CURTIS,
Secretary
November 1, 1995
New York, New York
- ----------------------------------------------------------------------------
IMPORTANT
YOU CAN HELP AVOID THE NECESSITY AND EXPENSE OF SENDING FOLLOW-UP LETTERS
TO ENSURE A QUORUM BY PROMPTLY RETURNING THE ENCLOSED PROXY. IF YOU ARE
UNABLE TO BE PRESENT IN PERSON, PLEASE FILL IN, SIGN AND RETURN THE ENCLOSED
PROXY IN ORDER THAT THE NECESSARY QUORUM MAY BE REPRESENTED AT THE MEETING.
THE ENCLOSED ENVELOPE REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
- ----------------------------------------------------------------------------
<PAGE>
INTERCAPITAL INCOME SECURITIES INC.
TWO WORLD TRADE CENTER, NEW YORK, NEW YORK 10048
---------------
PROXY STATEMENT
---------------
ANNUAL MEETING OF STOCKHOLDERS
DECEMBER 20, 1995
This statement is furnished in connection with the solicitation of proxies
by the Board of Directors (the "Board") of INTERCAPITAL INCOME SECURITIES
INC. (the "Fund"), for use at the Annual Meeting of Stockholders of the Fund
to be held on December 20, 1995 (the "Meeting"), and at any adjournments
thereof.
If the enclosed form of proxy is properly executed and returned in time to
be voted at the Meeting, the proxies named therein will vote the shares
represented by the proxy in accordance with the instructions marked thereon.
Unmarked proxies will be voted for each of the nominees for election as
Director and in favor of Proposals 2 and 3 as set forth in the Notice of
Annual Meeting of Stockholders. A proxy may be revoked at any time prior to
its exercise by any of the following: written notice of revocation to the
Secretary of the Fund, execution and delivery of a later dated proxy to the
Secretary of the Fund, or attendance and voting at the Meeting.
Stockholders as of the close of business on October 26, 1995, the record
date for the determination of stockholders entitled to notice of and to vote
at the Meeting, are entitled to one vote for each share held and a fractional
vote for a fractional share. On October 26, 1995, there were outstanding
12,200,518 shares of common stock of the Fund, all with $.01 par value. No
person was known to own as much as 5% of the outstanding shares of the Fund
on that date. Directors and officers of the Fund, together, owned less than
1% of the Fund's outstanding shares on that date. The percentage ownership of
shares of the Fund changes from time to time depending on purchases and sales
by stockholders and the total number of shares outstanding.
The cost of soliciting proxies for the Meeting, consisting principally of
mailing and printing expenses, will be borne by the Fund. The solicitation of
proxies will be by mail, which may be supplemented by solicitation by mail,
telephone or otherwise through Directors and officers of the Fund and
officers and regular employees of Dean Witter InterCapital Inc.
("InterCapital" or the "Investment Manager"), without special compensation
therefor. The first mailing of this proxy statement is expected to be made on
or about November 1, 1995.
(1) ELECTION OF DIRECTORS
The number of Directors has currently been fixed by the Board of Directors
at ten pursuant to the By-Laws of the Fund. At the Meeting, ten Directors are
to be elected to hold office until the next Annual Meeting of Stockholders or
until their successors shall have been elected and qualified. There are
presently ten Directors.
Eight of the current ten Directors (Jack F. Bennett, Michael Bozic, Edwin
J. Garn, John R. Haire, Manuel H. Johnson, Paul Kolton, Michael E. Nugent and
John L. Schroeder) are "Independent Directors", that is, Directors who are
not "interested persons" of the Fund, as that term is defined in the
Investment Company Act of 1940, as amended (the "Act"). The nominees for
election as Directors have been proposed by the Directors now serving or, in
the case of the nominees for positions as Independent Directors, by the
Independent Directors now serving. All of the Directors have been elected by
the Stockholders of the Fund.
2
<PAGE>
The nominees of the Board of Directors for election as Directors are
listed below. It is the intention of the persons named in the enclosed form
of proxy to vote the shares represented by them for the election of these
nominees: Jack F. Bennett, Michael Bozic, Charles A. Fiumefreddo, Edwin J.
Garn, John R. Haire, Manuel H. Johnson, Paul Kolton, Michael E. Nugent,
Philip J. Purcell and John L. Schroeder. Should any of the nominees become
unable or unwilling to accept nomination or election, the persons named in
the proxy will exercise their voting power in favor of such person or persons
as the Board may recommend. All of the nominees have consented to being named
in this proxy statement and to serve if elected. The Fund knows no reason why
any of said nominees would be unable or unwilling to accept nomination or
election. Directors will be elected by a plurality of the votes cast at the
Meeting. Abstentions and broker "non-votes" will have the same effect as a
vote against the proposal.
The following information regarding each of the nominees for election as
Director includes his principal occupations and employment for at least the
last five years, his age, shares of the Fund owned, if any, as of October 26,
1995 (shown in parentheses), positions with the Fund, and directorships or,
trusteeships in companies which file periodic reports with the Securities and
Exchange Commission, including the 80 investment companies, including the
Fund, for which InterCapital serves as investment manager or investment
adviser (referred to herein as the "Dean Witter Funds") and the 13 investment
companies for which InterCapital's wholly-owned subsidiary, Dean Witter
Services Company Inc. ("DWSC"), serves as manager and TCW Funds Management,
Inc. serves as investment adviser (referred to herein as the "TCW/DW Funds").
The nominees for Director to be elected at this Meeting are:
JACK F. BENNETT, Director since January, 1988; age 71; Retired; Director
or Trustee of the Dean Witter Funds; formerly Senior Vice President and
Director of Exxon Corporation (1975-1989) and Under Secretary of the U.S.
Treasury for Monetary Affairs (1974-1975); Director of Philips Electronics
N.V., Tandem Computers Inc. and Massachusetts Mutual Insurance Co.; director
or trustee of various not-for-profit and business organizations.
MICHAEL BOZIC, Director since April, 1994; age 54; Private investor;
Director or Trustee of the Dean Witter Funds; formerly President and Chief
Executive Officer of Hills Department Stores (May, 1991-July, 1995); formerly
Chairman and Chief Executive Officer (January, 1987-August, 1990) and
President and Chief Operating Officer (August, 1990-February, 1991) of the
Sears Merchandise Group of Sears, Roebuck and Co.; Director of Eaglemark
Financial Services, Inc., the United Negro College Fund, Weirton Steel
Corporation and Domain Inc. (home decor retailer).
CHARLES A. FIUMEFREDDO,* Director since July, 1991; age 62; Chairman,
Chief Executive Officer and Director of InterCapital, Dean Witter Services
Company Inc. ("DWSC") and Dean Witter Distributors Inc. ("Distributors");
Executive Vice President and Director of Dean Witter Reynolds Inc. ("DWR");
Chairman, Director or Trustee, President and Chief Executive Officer of the
Dean Witter Funds; Chairman, Chief Executive Officer and Trustee of the
TCW/DW Funds; Chairman and Director of Dean Witter Trust Company ("DWTC");
Director and/or officer of various Dean Witter, Discover & Co. ("DWDC")
subsidiaries; formerly Executive Vice President and Director of DWDC (until
February, 1993).
EDWIN JACOB (JAKE) GARN, Director since January, 1993; age 63; Director or
Trustee of the Dean Witter Funds; formerly United States Senator (R-Utah)
(1974-1992) and Chairman, Senate Banking Committee (1980-1986); formerly
Mayor of Salt Lake City, Utah (1971-1974); formerly Astronaut, Space Shuttle
Discovery (April 12-19, 1985); Vice Chairman, Huntsman Chemical Corporation
(since January, 1993); Director of Franklin Quest (time management systems)
and John Alden Financial Corp.; Member of the board of various civic and
charitable organizations.
3
<PAGE>
JOHN R. HAIRE, Director since January, 1983; age 70; Chairman of the Audit
Committee and Chairman of the Committee of the Independent Directors or
Trustees and Director or Trustee of the Dean Witter Funds; Trustee of the
TCW/DW Funds; formerly President, Council for Aid to Education (1978-1989)
and Chairman and Chief Executive Officer of Anchor Corporation, an investment
adviser (1964-1978); Director of Washington National Corporation (insurance).
DR. MANUEL H. JOHNSON, Director since July, 1991; age 46; Senior Partner,
Johnson Smick International, Inc., a consulting firm (since June, 1985); Koch
Professor of International Economics and Director of the Center for Global
Market Studies at George Mason University (since September, 1990); Director
or Trustee of the Dean Witter Funds; Trustee of the TCW/DW Funds; Co-Chairman
and a founder of the Group of Seven Council (G7C), an international economic
commission (since September, 1990); Director of NASDAQ (since June, 1995);
Director of Greenwich Capital Markets Inc. (broker-dealer); formerly Vice
Chairman of the Board of Governors of the Federal Reserve System (February,
1986-August, 1990) and Assistant Secretary of the U.S. Treasury (1982-1986).
PAUL KOLTON, Director since July, 1986 (2,410 shares); age 72; Director or
Trustee of the Dean Witter Funds; Chairman of the Audit Committee and
Chairman of the Committee of the Independent Trustees and Trustee of the
TCW/DW Funds; formerly Chairman of Financial Accounting Standards Advisory
Council and Chairman and Chief Executive Officer of the American Stock
Exchange; Director of UCC Investors Holding Inc. (Uniroyal Chemical Company,
Inc.); director or trustee of various not-for-profit organizations.
MICHAEL E. NUGENT, Director since July, 1991; age 59; General Partner,
Triumph Capital, L.P., a private investment partnership (since April, 1988);
Director or Trustee of the Dean Witter Funds; Trustee of the TCW/DW Funds;
formerly Vice President, Bankers Trust Company and BT Capital Corporation
(1984-1988); director of various business organizations.
PHILIP J. PURCELL,* Director since April, 1994; age 52; Chairman of the
Board of Directors and Chief Executive Officer of DWDC, DWR and Novus Credit
Services Inc.; Director of InterCapital, DWSC and Distributors; Director or
Trustee of the Dean Witter Funds; Director and/or officer of various DWDC
subsidiaries.
JOHN L. SCHROEDER, Director since April, 1994; age 65; Retired; Director
or Trustee of the Dean Witter Funds; Trustee of the TCW/DW Funds; Director of
Citizens Utilities Company; formerly Executive Vice President and Chief
Investment Officer of the Home Insurance Company (August, 1991-September,
1995); Chairman and Chief Investment Officer of Axe-Houghton Management and
the Axe-Houghton Funds (April, 1983-June, 1991) and President of USF&G
Financial Services, Inc. (June, 1990-June, 1991).
The executive officers of the Fund other than shown above are: Sheldon
Curtis, Vice President, Secretary and General Counsel; Robert M. Scanlan,
Vice President; David A. Hughey, Vice President; Edmund C. Puckhaber, Vice
President; Rochelle G. Siegel, Vice President; and Thomas F. Caloia,
Treasurer. In addition, Robert S. Giambrone, Joseph J. McAlinden, Peter M.
Avelar, Jonathan R. Page, Kevin Hurley and James F. Willison are Vice
Presidents of the Fund and Marilyn K. Cranney, Barry Fink, Lou Anne D.
McInnis and Ruth Rossi serve as Assistant Secretaries. Mr. Curtis is 63 years
old and is currently Senior Vice President, Secretary and General Counsel of
InterCapital and DWSC and Assistant Secretary of DWR; he is also Senior Vice
President, Assistant Secretary and Assistant General Counsel of Distributors
and Senior Vice President and
- ---------------
* Messrs. Fiumefreddo and Purcell may be deemed "interested persons," as
defined in Section 2(a)(19) of the Act, of the Fund and its Investment
Manager due to their affiliation with the Investment Manager and/or its
affiliated companies.
4
<PAGE>
Secretary of DWTC. Mr. Scanlan is 59 years old and is currently President and
Chief Operating Officer of InterCapital (since March, 1993) and DWSC; he is
also Executive Vice President of Distributors and Executive Vice President
and Director of DWTC. He was previously Executive Vice President of
InterCapital (July, 1992- March, 1993) and prior thereto was Chairman of
Harborview Group Inc. Mr. Hughey is 64 years old and is currently Executive
Vice President and Chief Administrative Officer of InterCapital; he is also
Executive Vice President and Chief Administrative Officer of Distributors,
DWSC and DWTC as well as a Director of DWTC. He was previously President of
DWTC (October, 1989-March, 1993). Mr. Puckhaber is 56 years old and is
currently Executive Vice President of InterCapital (since January, 1991) and
Director of DWTC. Ms. Siegel is 47 years old and is currently Senior Vice
President of InterCapital. Mr. Caloia is 49 years old and is currently First
Vice President and Assistant Treasurer of InterCapital and DWSC. Mr.
Giambrone is 42 years old and is currently Senior Vice President of
InterCapital, DWSC, Distributors and DWTC (since August, 1995). He was
formerly a partner of KPMG Peat Marwick, LLP. Mr. McAlinden is 52 years old
and is currently Senior Vice President of InterCapital (since June 1995). He
was formerly a Managing Director at Dillon Reed. Mr. Avelar is 37 years old
and is currently Senior Vice President of InterCapital. He was previously
employed by PaineWebber Asset Management as a senior portfolio manager. Mr.
Page is 49 years old and is currently Senior Vice President of InterCapital.
Mr. Hurley is 50 years old and is currently Senior Vice President of
InterCapital (since February, 1995). He was formerly a Managing Director at
Ark Asset Management. Mr. Willison is 52 years old and is currently Senior
Vice President of InterCapital. Other than Messrs. Scanlan, Giambrone,
McAlinden, Avelar and Hurley, each of the above officers has been an employee
of InterCapital or DWR (formerly the corporate parent of InterCapital) for
over five years.
BOARD OF DIRECTORS; RESPONSIBILITIES AND COMPENSATION OF INDEPENDENT
DIRECTORS
As mentioned above, the Fund is one of the Dean Witter Funds, a group of
investment companies managed by InterCapital. As of the date of this proxy
statement, there are a total of 80 Dean Witter Funds, comprised of 120
portfolios. As of September 30, 1995, the Dean Witter Funds had total net
assets of approximately $68.5 billion and more than five million
shareholders.
The Board of Directors or Trustees, consisting of ten (10) directors or
trustees, is the same for each of the Dean Witter Funds. Some of the Funds
are organized as business trusts, others as corporations, but the functions
and duties of directors and trustees are the same. Accordingly, directors and
trustees of the Dean Witter Funds are referred to in this section as
Directors.
Eight Directors, that is, 80% of the total number, have no affiliation or
business connection with InterCapital or any of its affiliated persons and do
not own any stock or other securities issued by InterCapital's parent
company, DWDC. These are the "disinterested" or "independent" Directors. Five
of the eight Independent Directors are also Independent Trustees of the
TCW/DW Funds. As of the date of this proxy statement, there are a total of 13
TCW/DW Funds. Two of the Funds' Directors, that is, the management Directors,
are affiliated with InterCapital.
As noted in a federal court ruling, "The independent directors. . . are
expected to look after the interests of shareholders by 'furnishing an
independent check upon management,' especially with respect to fees paid to
the investment company's sponsor." In addition to their general "watchdog"
duties, the Independent Directors are charged with a wide variety of
responsibilities under the Act. In order to perform their duties effectively,
the Independent Directors are required to review and understand large amounts
of material, often of a highly technical and legal nature.
The Dean Witter Funds seek as Independent Directors individuals of
distinction and experience in business and finance, government service or
academia; that is, people whose advice and counsel are valuable and in demand
by others and for whom there is often competition. To accept a position on
the Funds' Boards,
5
<PAGE>
such individuals may reject other attractive assignments because of the
demands made on their time by the Funds. Indeed, to serve on the Funds'
Boards, certain Directors who would be qualified and in demand to serve on
bank boards would be prohibited by law from serving at the same time as a
director of a national bank and as a Director of a Fund.
The Independent Directors are required to select and nominate individuals
to fill any Independent Director vacancy on the Board of any Fund that has a
Rule 12b-1 plan of distribution. Since most of the Dean Witter Funds have
such a plan, and since all of the Funds' Boards have the same members, the
Independent Directors effectively control the selection of other Independent
Directors of all the Dean Witter Funds.
GOVERNANCE STRUCTURE OF THE DEAN WITTER FUNDS
While the regulatory system establishes both general guidelines and
specific duties for the Independent Directors, the governance arrangements
from one investment company group to another vary significantly. In some
groups the Independent Directors perform their role by attendance at periodic
meetings of the board of directors with study of materials furnished to them
between meetings. At the other extreme, an investment company complex may
employ a full-time staff to assist the Independent Directors in the
performance of their duties.
The governance structure of the Dean Witter Funds lies between these two
extremes. The Independent Directors and the Funds' Investment Manager alike
believe that these arrangements are effective and serve the interests of the
Funds' shareholders. All of the Independent Directors serve as members of the
Audit Committee and the Committee of the Independent Directors. Three of them
also serve as members of the Derivatives Committee.
The Committee of the Independent Directors is charged with recommending to
the full Board approval of management, advisory and administration contracts,
Rule 12b-1 plans and distribution and underwriting agreements, continually
reviewing Fund performance, checking on the pricing of portfolio securities,
brokerage commissions, transfer agent costs and performance, and trading
among Funds in the same complex, and approving fidelity bond and related
insurance coverage and allocations, as well as other matters that arise from
time to time.
The Audit Committee is charged with recommending to the full Board the
engagement or discharge of the Fund's independent accountants; directing
investigations into matters within the scope of the independent accountants'
duties, including the power to retain outside specialists; reviewing with the
independent accountants the audit plan and results of the auditing
engagement; approving professional services provided by the independent
accountants and other accounting firms prior to the performance of such
services; reviewing the independence of the independent accountants;
considering the range of audit and non-audit fees; reviewing the adequacy of
the Fund's system of internal controls; advising the independent accountants
and management personnel that they have direct access to the Committee at all
times; and preparing and submitting Committee meeting minutes to the full
Board.
Finally, the Board of each Fund has established a Derivatives Committee to
establish parameters for and oversee the activities of the Fund with respect
to derivative investments, if any, made by the Fund.
Committee meetings are sometimes held away from the offices of
InterCapital and sometimes in the Boardroom of InterCapital. These meetings
are held without management directors or officers being present, unless and
until they may be invited to the meeting for purposes of furnishing
information or making a report. These separate meetings provide the
Independent Directors an opportunity to explore in depth with their own
independent legal counsel, independent auditors and other independent
consultants, as needed, the issues they believe should be addressed and
resolved in the interests of the Funds' shareholders.
6
<PAGE>
For the fiscal year ended September 30, 1995, the Board of Trustees of the
Trust held six meetings, and the Audit Committee, the Committee of the
Independent Trustees and the Derivatives Committee held two, ten and three
meetings, respectively. No Trustee attended fewer than 75% of the meetings of
the Board of Trustees, the Audit Committee, the Committee of the Independent
Trustees or the Derivatives Committee held while he served in such positions.
DUTIES OF CHAIRMAN OF COMMITTEES
The Chairman of the Committees maintains an office of the Funds'
headquarters in New York. He is responsible for keeping abreast of regulatory
and industry developments and the Funds' operations and management. He
screens and/or prepares written materials and identifies critical issues for
the Independent Directors to consider, develops agendas for Committee
meetings, determines the type and amount of information that the Committees
will need to form a judgment on the issues, and arranges to have the
information furnished. He also arranges for the services of independent
experts to be provided to the Committees and consults with them in advance of
meetings to help refine reports and to focus on critical issues. Members of
the Committees believe that the person who serves as Chairman of all three
Committees and guides their efforts is pivotal to the effective functioning
of the Committees.
The Chairman of the Committees also maintains continuous contact with the
Funds' management, with independent counsel to the Independent Directors and
with the Funds' independent auditors. He arranges for a series of special
meetings involving the annual review of investment management and other
operating contracts of the Funds and, on behalf of the Committees, conducts
negotiations with the Investment Manager and other service providers. In
effect, the Chairman of the Committees serves as a combination of chief
executive and support staff of the Independent Directors.
The Chairman of the Committees is not employed by any other organization
and devotes his time primarily to the services he performs as Committee
Chairman and Independent Director of the Dean Witter Funds and as an
Independent Trustee of the TCW/DW Funds. The current Committee Chairman has
had more than 35 years experience as a senior executive in the investment
company industry.
VALUE OF HAVING SAME INDIVIDUALS AS INDEPENDENT DIRECTORS FOR ALL DEAN WITTER
FUNDS
The Independent Directors and the Funds' management believe that having
the same Independent Directors for each of the Dean Witter Funds is in the
best interests of all the Funds' shareholders. This arrangement avoids the
duplication of effort that would arise from having different groups of
individuals serving as Independent Directors for each of the Funds or even of
sub-groups of Funds. It is believed that having the same individuals serve as
Independent Directors of all the Funds tends to increase their knowledge and
expertise regarding matters which affect the Fund complex generally and
enhances their ability to negotiate on behalf of each Fund with the Fund's
service providers. This arrangement also precludes the likelihood of separate
groups of Independent Directors arriving at conflicting decisions regarding
operations and management of the Funds and avoids the cost and confusion that
would likely ensue. Finally, it is believed that having the same Independent
Directors serve on all Fund Boards enhances the ability of each Fund to
obtain, at modest cost to each separate Fund, the services of Independent
Directors, and a Chairman of their Committees, of the caliber, experience and
business acumen of the individuals who serve as Independent Directors of the
Dean Witter Funds.
COMPENSATION OF INDEPENDENT DIRECTORS
The Fund pays each Independent Director an annual fee of $1,000 ($1,200
prior to October 1, 1995) plus a per meeting fee of $50 for meetings of the
Board of Directors or committees of the Board of Directors
7
<PAGE>
attended by the Director (the Fund pays the Chairman of the Audit Committee
an annual fee of $750 ($1,000 prior to January 1, 1995) and pays the Chairman
of the Committee of the Independent Directors an additional annual fee of
$2,400, in each case inclusive of the Committee meeting fees). The Fund also
reimburses such Directors for travel and other out-of-pocket expenses
incurred by them in connection with attending such meetings. Directors and
officers of the Fund who are or have been employed by the Investment Manager
or an affiliated company receive no compensation or expense reimbursement
from the Fund.
The Fund has adopted a retirement program under which an Independent
Director who retires after serving for at least five years (or such lesser
period as may be determined by the Board) as an Independent Director or
Director of any Dean Witter Fund that has adopted the retirement program
(each such Fund referred to as an "Adopting Fund" and each such Director
referred to as an "Eligible Director") is entitled to retirement payments
upon reaching the eligible retirement age (normally, after attaining age 72).
Annual payments are based upon length of service. Currently, upon retirement,
each Eligible Director is entitled to receive from the Fund, commencing as of
his or her retirement date and continuing for the remainder of his or her
life, an annual retirement benefit (the "Regular Benefit") equal to 28.75% of
his or her Eligible Compensation plus 0.4791666% of such Eligible
Compensation for each full month of service as an Independent Director or
Director of any Adopting Fund in excess of five years up to a maximum of
57.50% after ten years of service. The foregoing percentages may be changed
by the Board.(1) "Eligible Compensation" is one fifth of the total
compensation earned by such Eligible Director for service to the Fund in the
five year period prior to the date of the Eligible Director's retirement.
Benefits under the retirement program are not secured or funded by the Fund.
As of the date of this proxy statement, 58 Dean Witter Funds have adopted the
retirement program.
- ---------------
(1) An Eligible Director may elect alternate payments of his or her
retirement benefits based upon the combined life expectancy of such
Eligible Director and his or her spouse on the date of such Eligible
Director's retirement. The amount estimated to be payable under this
method, through the remainder of the later of the lives of such
Eligible Director and spouse, will be the actuarial equivalent of the
Regular Benefit. In addition, the Eligible Director may elect that
the surviving spouse's periodic payment of benefits will be equal to
either 50% or 100% of the previous periodic amount, an election that,
respectively, increases or decreases the previous periodic amount so
that the resulting payments will be the actuarial equivalent of the
Regular Benefit.
8
<PAGE>
The following table illustrates the compensation paid and the retirement
benefits accrued to the Fund's Independent Directors by the Fund for the
fiscal year ended September 30, 1995 and the estimated retirement benefits
for the Fund's Independent Directors as of September 30, 1995.
<TABLE>
<CAPTION>
FUND COMPENSATION ESTIMATED RETIREMENT BENEFITS
-------------------------------- ----------------------------------------------------------------
ESTIMATED
RETIREMENT CREDIT YEARS OF ESTIMATED ESTIMATED
AGGREGATE BENEFITS SERVICE AT PERCENTAGE OF ESTIMATED ANNUAL
COMPENSATION ACCRUED AS FUND RETIREMENT ELIGIBLE ELIGIBLE BENEFITS UPON
NAME OF INDEPENDENT DIRECTOR FROM THE FUND EXPENSES (MAXIMUM 10) COMPENSATION COMPENSATION(2) RETIREMENT(3)
- ---------------------------- --------------- --------------- --------------- --------------- --------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Jack F. Bennett ............. $1,800 $1,344 8 46.0% $2,219 $1,021
Michael Bozic ............... 1,900 341 10 57.5 1,950 1,121
Edwin J. Garn ............... 2,000 634 10 57.5 1,950 1,121
John R. Haire ............... 4,350(4) 3,132 10 57.5 5,145 2,958
Dr. Manual H. Johnson ....... 1,950 258 10 57.5 1,950 1,121
Paul Kolton ................. 2,000 1,369 10 57.0 2,435 1,388
Michael E. Nugent ........... 1,850 453 10 57.5 1,950 1,121
John L. Schroeder ........... 1,850 670 8 47.9 1,950 934
<FN>
- ---------------
(2) Based on current levels of compensation.
(3) Based on current levels of compensation. Amount of annual benefits
also varies depending on the Director's elections described in
Footnote (1) above.
(4) Of Mr. Haire's compensation from the Fund, $3,400 was paid to him as
Chairman of the Committee of the Independent Directors ($2,400) and
as Chairman of the Audit Committee ($1,000).
</TABLE>
The following table illustrates the compensation paid to the Fund's
Independent Directors for the calendar year ended December 31, 1994 for
services to the 73 Dean Witter Funds and, in the case of Messrs. Haire,
Johnson, Kolton and Nugent, the 13 TCW/DW Funds that were in operation at
December 31, 1994. With respect to Messrs. Haire, Johnson, Kolton and Nugent,
the TCW/DW Funds are included solely because of a limited exchange privilege
between those Funds and five Dean Witter Money Market Funds. Mr. Schroeder
was elected as a Trustee of the TCW/DW Funds on April 20, 1995.
CASH COMPENSATION FROM DEAN WITTER FUNDS AND TCW/DW FUNDS
<TABLE>
<CAPTION>
FOR SERVICE AS
CHAIRMAN OF
FOR SERVICE AS COMMITTEES OF TOTAL CASH
DIRECTOR OR FOR SERVICE AS INDEPENDENT COMPENSATION
DIRECTOR AND DIRECTOR AND DIRECTORS/ FOR SERVICES TO
COMMITTEE MEMBER COMMITTEE MEMBER TRUSTEES AND 73 DEAN WITTER
OF 73 DEAN WITTER OF 13 TCW/DW AUDIT FUNDS AND 13
NAME OF INDEPENDENT DIRECTOR FUNDS FUNDS COMMITTEES TCW/DW FUNDS
- ---------------------------- ----------------- ---------------- -------------- ---------------
<S> <C> <C> <C> <C>
Jack F. Bennett ............. $125,761 -- -- $125,761
Michael Bozic ............... 82,637 -- -- 82,637
Edwin J. Garn ............... 125,711 -- -- 125,711
John R. Haire ............... 101,061 $66,950 $225,563(5) 393,574
Dr. Manuel H. Johnson ....... 122,461 60,750 -- 183,211
Paul Kolton ................. 128,961 51,850 34,200(5) 215,011
Michael E. Nugent ........... 115,761 52,650 -- 168,411
John L. Schroeder ........... 85,938 -- -- 85,938
<FN>
- ---------------
(5) For the 73 Dean Witter Funds.
(6) For the 13 TCW/DW Funds.
</TABLE>
As of the date of this proxy statement, the aggregate number of shares of
common stock of the Fund owned by the Fund's officers and Directors as a
group was less than 1 percent of the Fund's shares of common stock interest
outstanding.
9
<PAGE>
(2) APPROVAL OR DISAPPROVAL OF CURRENTLY EFFECTIVE
INVESTMENT MANAGEMENT AGREEMENT
The Fund's investments are managed by Dean Witter InterCapital Inc.
(referred to herein as the "Investment Manager" or "InterCapital"), pursuant
to an Investment Management Agreement dated June 30, 1993 (referred to herein
as the "Management Agreement") which took effect upon the distribution by
Sears, Roebuck and Co. ("Sears") to its shareholders of all the common shares
of DWDC (the parent company of InterCapital and DWR) then owned by Sears.
The Management Agreement was approved by the Board of Directors on October
30, 1992, and by the stockholders of the Fund at the Annual Meeting of
Stockholders held on January 13, 1993. The present Management Agreement
supersedes an earlier management agreement originally entered into by the
Fund with DWR, through its InterCapital Division, and initially approved by
the Board, including a majority of the Independent Directors, on January 18,
1983 and last approved by the Stockholders of the Fund at their Annual
Meeting of Stockholders on December 30, 1991. In an internal reorganization
which took place in January, 1993, InterCapital assumed the investment
management activities previously performed by the InterCapital Division of
DWR. The assumption by InterCapital of DWR's rights and obligations under
this earlier management agreement in connection with the reorganization was
approved by the Directors at a meeting held on October 30, 1992 and also by
the Stockholders of the Fund at the Annual Meeting of Stockholders on January
13, 1993.
The terms of the Management Agreement, including fees payable by the Trust
thereunder, are substantially identical in all respects to those of the
earlier management agreement except for the dates of effectiveness and
expiration and the name of the Investment Manager. The terms of the
Management Agreement are described below. The Management Agreement was last
approved by the Stockholders of the Fund as a routine matter at their Annual
Meeting held on December 22, 1994. The Management Agreement's continuation
until April 30, 1996 was approved by the Directors, including a majority of
the Independent Directors, at a meeting of the Board held on April 20, 1995.
In the event Stockholders do not approve continuance of the Management
Agreement by the required majority vote at the forthcoming meeting or any
adjournment thereof, the Board of Directors of the Fund will take such action
as it deems to be in the best interest of the Fund and its Stockholders,
which may include calling a special meeting of Stockholders to vote on a new
investment management agreement.
In considering whether or not to approve the Management Agreement, the
Board of Directors reviewed the terms of the agreement and considered all
materials and information deemed relevant to its determination. Among other
things, the Board considered the nature and scope of services to be rendered,
the quality of the Investment Manager's services and personnel, and the
appropriateness of the fees that are paid under the Management Agreement.
Based upon its review, the Board of Directors, including all of the
Independent Directors, determined that the approval of the Management
Agreement was in the best interests of the Fund and its Stockholders.
The favorable vote of a majority of the outstanding voting securities of
the Fund is required for the approval of the Management Agreement. Such a
majority is defined in the Act as the lesser of: (a) 67% or more of the
shares present at the Meeting, if the holders of more than 50% of the
outstanding shares of the Fund are present or represented by proxy, or (b)
more than 50% of the outstanding shares. Abstentions and broker "non-votes"
will have the same effect as a vote against the proposal.
THE BOARD OF DIRECTORS, INCLUDING ALL OF THE INDEPENDENT DIRECTORS,
RECOMMENDS THAT THE STOCKHOLDERS APPROVE THE MANAGEMENT AGREEMENT.
10
<PAGE>
THE MANAGEMENT AGREEMENT
The Management Agreement provides that the Investment Manager shall obtain
and evaluate such information and advice relating to the economy, securities
and commodity markets and securities and commodities as it deems necessary or
useful to discharge its duties under the Management Agreement, and that it
shall continuously supervise the management of the assets of the Fund in a
manner consistent with the investment objectives and policies of the Fund and
subject to such other limitations and directions as the Board may, from time
to time, prescribe.
The Management Agreement provides that the Investment Manager shall
continuously manage the assets of the Fund in a manner consistent with the
Fund's investment objectives. The Investment Manager has authority to place
orders for the purchase and sale of portfolio securities on behalf of the
Fund without prior approval of its Directors. The Directors review the
investment portfolio at their regular meetings. In addition, the Investment
Manager pays the compensation of the officers of the Fund and provides the
Fund with office space and equipment, and clerical and bookkeeping services
and telephone service, heat, light, power and other utilities. The Investment
Manager also pays for the services of personnel in connection with the
pricing of the Fund's shares and the preparation of prospectuses, proxy
statements and reports required to be filed with federal and state securities
commissions (except insofar as the participation or assistance of independent
accountants and attorneys is, in the opinion of the Investment Manager,
necessary or desirable). In return for its services and the expenses the
Investment Manager assumes under the Management Agreement, the Fund pays the
Investment Manager compensation which is computed and accrued weekly and
payable monthly and which is determined by applying the annual rate of 1/2 of
1% to the Fund's average weekly net assets. The Management Agreement provides
that if operating expenses, including the management fee but excluding
interest, taxes, brokerage commissions and extraordinary expenses (to the
extent permitted by state securities laws or regulations), paid or payable by
the Fund in any fiscal year exceed (a) 1 1/2 % of the first $30 million of
the average weekly net assets of the Fund during such year and 1% of such
average net assets in excess of $30 million; or (b) 25% of the Fund's gross
income for such year the Investment Manager will pay the Fund the greater of
the excess as computed under (a) or (b). Any such payments will be made on a
monthly basis either by direct payment or by offset against the monthly fee
payable to the Investment Manager. During the fiscal year ended September 30,
1995, the Fund's expenses did not exceed the limitations noted above. For the
fiscal year ended September 30, 1995, the Fund accrued to the Investment
Manager total compensation of $1,056,264. The net assets of the Fund totalled
$219,892,411 at September 30, 1995.
Under the Management Agreement, the Fund is obligated to bear all of the
costs and expenses of its operation, except those specifically assumed by the
Investment Manager, including, without limitation: charges and expenses of
any registrar, custodian or depository appointed by the Fund for the
safekeeping of its cash, portfolio securities or commodities and other
property, and any stock transfer or dividend agent or agents appointed by the
Fund; brokers' commissions chargeable to the Fund in connection with
portfolio securities transactions to which the Fund is a party; all taxes,
including securities or commodities issuance and transfer taxes, and
corporate fees payable by the Fund to federal, state or other governmental
agencies; all costs and expenses of engraving or printing of certificates
representing shares of the Fund; all costs and expenses in connection with
registration and maintenance of registration of the Fund and of its shares
with the Securities and Exchange Commission and various states and other
jurisdictions (including filing fees and legal fees and disbursements of
counsel); the cost and expense of printing, including typesetting, and
distributing prospectuses of the Fund to its Stockholders; all expenses of
Stockholders' and Directors' meetings and of preparing, printing and mailing
proxy statements and reports to Stockholders; fees and travel expenses of
Directors or members of any advisory board or committee, who are not
employees of the Investment Manager or any corporate affiliate of the
Investment Manager; all expenses incident to the payment of any dividend,
distribution,
11
<PAGE>
withdrawal or redemption, whether in shares or in cash, charges and expenses
of any outside service used for the pricing of the Fund's shares, charges and
expenses of legal counsel, including counsel to the Independent Directors of
the Fund, and independent accountants in connection with any matter relating
to the Fund (not including compensation or expenses of attorneys employed by
the Investment Manager); association dues; interest payable on the Fund's
borrowings; fees and expenses incident to the listing of the Fund's shares on
any stock exchange; postage; insurance premiums on property or personnel
(including officers and Directors) of the Fund which inure to its benefit;
and extraordinary expenses (including, but not limited to, legal claims and
liabilities and litigation costs and any indemnification related thereto);
and all other charges and costs to the Fund's operations unless otherwise
explicitly provided in the Management Agreement.
The Management Agreement had an initial term ending April 30, 1994 and
provides that, after the initial period of effectiveness, it will continue in
effect from year to year thereafter provided such continuance is approved at
least annually by vote of a majority, as defined in the Act, of the
outstanding voting securities of the Fund or by the Directors of the Fund,
and, in either event, by the vote cast in person by a majority of the
Directors who are not parties to the Management Agreement or "interested
persons" of any such party (as defined in the Act) at a meeting called for
the purpose of voting on such approval. The Management Agreement's
continuation until April 30, 1996 was approved by the Directors, including a
majority of the Independent Directors, at a Meeting of the Directors held on
April 20, 1995, called for the purpose of approving the Management Agreement.
The Management Agreement also provides that it may be terminated at any
time by the Investment Manager, the Directors of the Fund or by a vote of a
majority of the outstanding voting securities of the Fund, in each instance
without the payment of any penalty, on thirty days' notice and will
automatically terminate upon any assignment.
Effective December 31, 1993, pursuant to a Services Agreement between
InterCapital and DWSC, a wholly-owned subsidiary of InterCapital, DWSC began
to provide the administrative services to the Fund which were previously
performed directly by InterCapital. On April 17, 1995, DWSC was reorganized
in the State of Delaware, necessitating the entry into a new Services
Agreement by InterCapital and DWSC on such date. The foregoing internal
reorganizations did not result in any change in the nature or scope of the
administrative services being provided to the Fund or any of the fees paid by
the Fund for the overall services being performed under the terms of the
Management Agreement.
THE INVESTMENT MANAGER
Dean Witter InterCapital Inc. is the Fund's investment manager.
InterCapital maintains its offices at Two World Trade Center, New York, New
York 10048. InterCapital, which was incorporated in July, 1992, is a
wholly-owned subsidiary of Dean Witter, Discover & Co. ("DWDC"), a balanced
financial services organization providing a broad range of nationally
marketed credit and investment products.
The Principal Executive Officer and Directors of InterCapital, and their
principal occupations, are:
Philip J. Purcell, Chairman of the Board of Directors and Chief Executive
Officer of DWDC and DWR and Director of InterCapital, DWSC and Distributors;
Richard M. DeMartini, President and Chief Operating Officer of Dean Witter
Capital, Executive Vice President of DWDC and Director of DWR, Distributors,
DWSC, DWTC and InterCapital; James F. Higgins, President and Chief Operating
Officer of Dean Witter Financial, Executive Vice President of DWDC and
Director of DWR, Distributors, InterCapital, DWTC and DWSC; Charles A.
Fiumefreddo, Executive Vice President and Director of DWR, Chairman of the
Board of Directors, Chief Executive Officer and Director of InterCapital,
DWSC and Distributors and Chairman of the Board of Directors and Director of
DWTC; Christine A. Edwards, Executive Vice President, Secretary and
12
<PAGE>
General Counsel of DWDC, Executive Vice President, Secretary, General Counsel
and Director of DWR, Executive Vice President, Secretary, Chief Legal Officer
and Director of Distributors and Director of InterCapital and DWSC; and
Thomas C. Schneider, Executive Vice President and Chief Financial Officer of
DWDC and Executive Vice President, Chief Financial Officer and Director of
DWR, Distributors, InterCapital and DWSC.
The business address of the foregoing Directors and Executive Officers is
Two World Trade Center, New York, New York 10048.
InterCapital and its wholly-owned subsidiary, DWSC, serve in various
investment management, advisory, management and administrative capacities to
investment companies and pension plans and other institutional and individual
investors. The Appendix lists the investment companies for which InterCapital
provides investment management or investment advisory services and which have
similar investment objectives to that of the Fund and sets forth the net
assets and fees payable to InterCapital by such companies, including the
Fund.
DWDC has its offices at Two World Trade Center, New York, New York 10048.
There are various lawsuits pending against DWDC involving material amounts
which, in the opinion of its management, will be resolved with no material
effect on the consolidated financial position of the company.
During the fiscal year ended September 30, 1995, the Fund accrued to Dean
Witter Trust Company, the Fund's Transfer Agent and an affiliate of the
Investment Manager, transfer agency fees of $183,288.
AFFILIATED BROKER
Because DWR and InterCapital are under the common control of DWDC, DWR is
an affiliated broker of InterCapital. For the fiscal year ended September 30,
1995, the Trust paid $602 in brokerage commissions to DWR, representing 100%
of the total brokerage commissions paid by the Fund during the year.
(3) RATIFICATION OR REJECTION OF SELECTION OF INDEPENDENT ACCOUNTANTS
The Directors have unanimously selected the firm of Price Waterhouse LLP
as the Fund's independent accountants for the fiscal year ending September
30, 1996. Its selection is being submitted for ratification or rejection by
Stockholders at the Meeting. Price Waterhouse LLP has been the independent
accountants for the Fund since its inception, and has no direct or indirect
financial interest in the Fund.
A representative of Price Waterhouse LLP is expected to be present at the
Meeting and will be available to make a statement, if he or she so desires,
and to respond to appropriate questions of Stockholders.
The affirmative vote of the holders of a majority of the shares
represented and entitled to vote at the Annual Meeting is required for
ratification of the selection of Price Waterhouse LLP as the independent
accountants for the Fund. Abstentions and broker "non-votes" will have the
same effect as a vote against the proposal.
THE DIRECTORS UNANIMOUSLY RECOMMEND THAT STOCKHOLDERS RATIFY THE SELECTION
OF PRICE WATERHOUSE LLP AS THE INDEPENDENT ACCOUNTANTS FOR THE FUND.
ADDITIONAL INFORMATION
In the event that the necessary quorum to transact business at the
Meeting, or the vote required to approve or reject any proposal, is not
obtained, the persons named as proxies may propose one or more adjournments
of the Meeting for a total of not more than 60 days in the aggregate to
permit further solicitation of proxies.
13
<PAGE>
Any such adjournment will require the affirmative vote of the holders of a
majority of the Fund's shares present in person or by proxy at the Meeting.
The persons named as proxies will vote in favor of such adjournment those
proxies which they are entitled to vote in favor of Proposal 2 and will vote
against any such adjournment those proxies required to be voted against that
proposal.
SHAREHOLDERS PROPOSALS
Proposals of security holders intended to be presented at the next Annual
Meeting of Stockholders must be received no later than July 12, 1996, for
inclusion in the proxy statement for that meeting.
REPORTS TO STOCKHOLDERS
The Fund's most recent Annual Report, and its most recent Semi-annual
Report succeeding the Annual Report, are available without charge upon
request from Adrienne Ryan-Pinto at Dean Witter Trust Company, Harborside
Financial Center, Plaza Two, Jersey City, New Jersey 07311 (telephone
1-800-869-NEWS) (toll-free).
OTHER BUSINESS
The management knows of no other matters which may be presented at the
Meeting. However, if any matters not now known properly come before the
Meeting, it is the intention of the persons named in the enclosed form of
proxy, or their substitutes, to vote all shares that they are entitled to
vote on any such matter, utilizing such proxy in accordance with their best
judgment on such matters.
By Order of the Board of Directors
SHELDON CURTIS
Secretary
14
<PAGE>
APPENDIX
InterCapital serves as investment manager to the Fund and the other
investment companies listed below which have similar investment objectives to
that of the Fund, with the net assets shown as of October 26, 1995.
<TABLE>
<CAPTION>
NET ASSETS AS CURRENT INVESTMENT MANAGEMENT
OF 10/26/95 FEE RATE(S)
-------------- -------------------------------
<S> <C> <C>
1. DEAN WITTER HIGH YIELD SECURITIES INC.* ....... $453,701,746 0.50% on assets up to $500
million, scaled down at various
asset levels to 0.30% on assets
over $3 billion
2. DEAN WITTER U.S. GOVERNMENT SECURITIES TRUST* . $7,984,956,811 0.50% on assets up to $1
million, scaled down at various
asset levels to 0.30% on assets
over $12.5 billion
3. DEAN WITTER CONVERTIBLE SECURITIES TRUST* .... $179,078,887 0.60% on assets up to $750
million, scaled down at various
asset levels to 0.425% on
assets over $3 billion
4. DEAN WITTER FEDERAL SECURITIES TRUST* ........ $825,905,771 0.55% on assets up to $1
billion, scaled down at various
asset levels to 0.35% on assets
over $12.5 billion
5. INTERCAPITAL INCOME SECURITIES INC.** ........ $219,962,759 0.50%
6. HIGH INCOME ADVANTAGE TRUST** ................. $158,170,500 0.75% on assets up to $250
million, scaled down at various
asset levels to 0.30% on assets
over $1 billion
7. HIGH INCOME ADVANTAGE TRUST II** .............. $212,557,938 0.75% on assets up to $250
million, scaled down at various
asset levels to 0.30% on assets
over $1 billion
8. HIGH INCOME ADVANTAGE TRUST III** ............. $81,882,682 0.75% on assets up to $250
million, scaled down at various
asset levels to 0.30% on assets
over $1 billion
9. DEAN WITTER INTERMEDIATE INCOME SECURITIES* ... $232,062,921 0.60% on assets up to $500
million, scaled down at various
asset levels to 0.30% on assets
over $1 billion
10. DEAN WITTER WORLD WIDE INCOME TRUST* ........ $138,790,799 0.75% on assets up to $250
million, scaled down at various
asset levels to 0.30% on assets
over $1 billion
11. DEAN WITTER GOVERNMENT INCOME TRUST** ....... $474,372,082 0.60%
12. DEAN WITTER GLOBAL SHORT-TERM INCOME FUND
INC.* ........................................ $107,445,536 0.55% on assets up to $500
million and 0.50% on assets
over $500 million
13. DEAN WITTER PREMIER INCOME TRUST* ............ $31,277,103 0.50% (of which 40% is paid to
a Sub-Adviser)
14. DEAN WITTER SHORT-TERM U.S. TREASURY TRUST* .. $283,167,296 0.35%
15. DEAN WITTER DIVERSIFIED INCOME TRUST* ........ $542,204,296 0.40%
</TABLE>
A-1
<PAGE>
<TABLE>
<CAPTION>
NET ASSETS AS CURRENT INVESTMENT MANAGEMENT
OF 10/26/95 FEE RATE(S)
-------------- -------------------------------
<S> <C> <C>
16. DEAN WITTER SHORT-TERM BOND FUND* ............ $35,788,993 0.70%(1)
17. DEAN WITTER HIGH INCOME SECURITIES* ......... $353,890,406 0.50%
18. PRIME INCOME TRUST** ......................... $546,404,320 0.90% on assets up to $500
million and 0.85% on assets
over $500 million
19. DEAN WITTER BALANCED INCOME FUND* ............ $22,330,496 0.60%(2)
20. DEAN WITTER RETIREMENT SERIES:*
(a) U.S. GOVERNMENT SECURITIES SERIES ........ $8,567,500 0.65%(3)
(b) INTERMEDIATE INCOME SECURITIES SERIES .... $4,213,399 0.65%(3)
21. DEAN WITTER VARIABLE INVESTMENT SERIES:***
(a) QUALITY INCOME PLUS PORTFOLIO ............ $494,141,782 0.50% on assets up to $500
million and 0.45% on assets
over $500 million
(b) HIGH YIELD PORTFOLIO ..................... $147,838,127 0.50%
22. DEAN WITTER SELECT DIMENSIONS INVESTMENT
SERIES:***
(a) DIVERSIFIED INCOME PORTFOLIO ............. $6,594,136 0.40%(4)
(b) NORTH AMERICAN GOVERNMENT SECURITIES
PORTFOLIO ................................ $1,105,857 0.65%(4) (of which 40% is
paid to a Sub-Adviser)
23. DEAN WITTER INTERMEDIATE TERM U.S. TREASURY
TRUST* ....................................... $3,852,248 0.35%(5)
<FN>
- ---------------
* Open-end investment company.
** Closed-end investment company.
*** Open-end investment company offered only to life insurance companies
in connection with variable annuity and/or variable life insurance
contracts.
(1) InterCapital has undertaken to assume all operating expenses of Dean
Witter Short-Term Bond Fund (except for any brokerage fees) and to
waive the compensation provided for in its investment management
agreement with that company until December 31, 1995.
(2) InterCapital has undertaken to assume all operating expenses of Dean
Witter Balanced Income Fund (except for any brokerage fees) and to
waive the compensation provided for in its investment management
agreement with that company until such time as that company has $50
million of net assets or until March 31, 1996, whichever occurs
first.
(3) InterCapital has undertaken to assume all operating expenses of the
Series of Dean Witter Retirement Series (except for any brokerage
fees and a portion of organizational expenses) and to waive the
compensation provided for in its investment management agreement with
that company in respect of each Series until December 31, 1995, and
to assume such expenses and waive the compensation provided for in
its investment management agreement with respect to any Series to the
extent that such expenses and compensation exceed 1.00% of the daily
net assets of the Series for the period from January 1, 1996 through
July 31, 1997.
(4) InterCapital has undertaken to assume all operating expenses of the
Portfolios of Dean Witter Select Dimensions Investment Series (except
for any brokerage fees and a portion of organizational expenses) and
to waive the compensation provided for in its investment management
agreement with that company in respect of each Portfolio until such
time as the pertinent Portfolio has $50 million of net assets or
until December 31, 1995, whichever occurs first.
(5) InterCapital has undertaken to assume all operating expenses of Dean
Witter Intermediate Term U.S. Treasury Trust (except for any 12b-1
fees and brokerage expenses) and to waive the compensation provided
for in its investment management agreement with that company until
such time as that company has $50 million of net assets or until
March 27, 1996, whichever occurs first.
A-2
</TABLE>
<PAGE>
INTERCAPITAL INCOME SECURITIES INC.
ANNUAL MEETING OF STOCKHOLDERS--DECEMBER 20, 1995
PROXY
The undersigned hereby appoints SHELDON CURTIS, EDMUND C. PUCKHABER,
ROBERT M. SCANLAN, or any of them, proxies, each with the power of
substitution, to vote on behalf of the undersigned at the Annual Meeting of
Stockholders of INTERCAPITAL INCOME SECURITIES INC. on December 20, 1995 at
9:00 a.m., New York City time, and at any adjournment thereof, on the
proposals set forth in the Notice of Meeting dated November 1, 1995 as
follows:
THIS PROXY IS SOLICITED BY THE DIRECTORS. IF NO SPECIFICATION IS MADE ON
REVERSE SIDE, THIS PROXY WILL BE VOTED FOR ALL NOMINEES FOR DIRECTORS AND FOR
THE PROPOSALS.
IMPORTANT: PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD IN THE ENCLOSED
ENVELOPE.
(Continued, and to be dated and signed on reverse side.)
<PAGE>
PLEASE MARK BOXES [X] OR [X] IN BLUE OR BLACK INK.
1. ELECTION OF DIRECTORS: [ ] FOR ALL NOMINEES [ ] WITHHOLD
(except as marked to AUTHORITY
the contrary below) (to vote for
all nominees)
Jack F. Bennett, Michael Bozic, Charles A. Fiumefreddo, Edwin J. Garn, John
R. Haire, Manuel H. Johnson,
Paul Kolton, Michael E. Nugent, Philip J. Purcell, John L. Schroeder
(INSTRUCTION: To withhold authority to vote for any individual nominee write
that nominee's name on the space provided below.)
- -----------------------------------------------------------------------------
2. APPROVAL OF INVESTMENT MANAGEMENT AGREEMENT:
FOR [ ] AGAINST [ ] ABSTAIN [ ]
3. RATIFICATION OF APPOINTMENT OF PRICE WATERHOUSE LLP AS INDEPENDENT
ACCOUNTANTS:
FOR [ ] AGAINST [ ] ABSTAIN [ ]
098
and in their discretion in the transaction of any other business which may
properly come before the meeting.
Please sign
personally. If the
share is registered in
more than one name,
each joint owner or
each fiduciary should
sign personally. Only
authorized officers
should sign for
corporations.
Dated ----------------------
----------------------
Signature
----------------------
