SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
AMENDMENT NO. 28
N-8B-2
File No. 811-2868
REGISTRATION STATEMENT OF UNIT INVESTMENT TRUSTS WHICH ARE
CURRENTLY ISSUING SECURITIES
November 16, 1995
Pursuant to Section 8(b) of the
Investment Company Act of 1940
New York Municipal Trust, Series 1
(and Subsequent Series);
New York Discount & Zero Coupon Fund - 1st Series
(and Subsequent Series);
Municipal Securities Trust, Series 1
(and Subsequent Series);
1st Discount Series
(and Subsequent Series);
High Income Series 1
(and Subsequent Series);
Multi-State Series 1
(and Subsequent Series);
Short-Intermediate Term Series 1
(and Subsequent Series);
Insured Municipal Securities Trust,
Series 1 (Multiplier Portfolio)
(and Subsequent Series);
Series 1 (and Subsequent Series);
and 5th Discount Series
(and Subsequent Series);
Mortgage Securities Trust CMO Series 1
(and Subsequent Series)
Equity Securities Trust Series 1
(and Subsequent Series)
Name of Registrant
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600 Fifth Avenue
New York, New York 10022
Address and Principal Office of Registrant
X Not the issuer of periodic payment plan certificates.
_____ Issuer of periodic payment plan certificates.
Amending items 2, 3, 4, 6, 11, 13(d)-(g), 16, 18(c), 23, 25, 27, 28(a)(b), 29,
30, 44(b), 46(a)(b), 52(a)(c), and 59.
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I. ORGANIZATION AND GENERAL INFORMATION
2. Furnish name and principal business address and ZIP
Code and the Internal Revenue Service Employer Identification
Number of each depositor of the trust.
Reich & Tang Distributors L.P.
600 Fifth Avenue
New York, New York 10020
Internal Revenue Service Employer
Identification Number: 13-3598607
3. Furnish name and principal business address and ZIP Code and
the Internal Revenue Service Employer Identification Number of each custodian
or trustee of the trust indicating for which class or series of securities
each custodian or trustee is
acting.
Trustee:
The Chase Manhattan Bank (National Association)
770 Broadway
New York, New York 10003
Internal Revenue Service Employer
Identification Number: 13-2633612
4. Furnish name and principal business address and ZIP
Code and the Internal Revenue Service Employer Identification
Number of each principal underwriter currently distributing
securities of the trust.
Reich & Tang Distributors L.P.
600 Fifth Avenue
New York, New York 10020
Internal Revenue Service Employer
Identification Number: 13-3598607
6. (a) Furnish the dates of execution and termination
of any indenture or agreement currently in effect under the terms
of which the trust was organized and issued or proposes to issue
securities.
The form of Trust Indenture and Agreement among Reich & Tang
Distributors L.P., as Depositor and The Chase Manhattan
Bank, N.A., as Trustee, to be employed by the Trust will be
filed as Exhibit 99.1.1.1 to the Registration Statement on
Form S-6 of the Trust. The Indenture will be
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dated the initial date of deposit of the securities in
Equity Securities Trust, Series 6, Signature Series, Gabelli
Entertainment and Media Trust and shall terminate no later
than the disposition of the last security purchased by the
Trust but no later than the Mandatory Termination Date which
is approximately three years and sixty days from the initial
date of deposit.
Substantially identical but separate Reference Trust
Agreements will be executed for each Series of Equity
Securities Trust between the Depositor and Trustee. The
respective Reference Trust Agreements shall be dated as of
the Date of Deposit of the underlying securities for each
series and shall terminate on the date of the disposition of
the last security held in the Trust portfolio but no later
than the Mandatory Termination Date which is approximately
three years and sixty days from the initial date of deposit.
II. GENERAL DESCRIPTION OF THE TRUST AND SECURITIES OF THE TRUST
Information Concerning the Securities Underlying
the Trust's Securities
11. Describe briefly the kind or type of securities comprising the
Unit of specified securities in which security holders have an interest.
For Series of Equity Securities Trust, see "Portfolio
Summary", "The Trust--The Securities" and "The Trust--
Risk Considerations" in Exhibit 3.
Information Concerning Loads, Fees, Charges and Expenses
13. (d) Explain fully the reasons for any difference in the price
at which securities are offered generally to the public, and the price at
which securities are offered for any class of transactions to any class or
group of individuals, including officers, directors, or employees of the
depositor, trustee, custodian or principal underwriter.
For Series of Equity Securities Trust, see "Accrued Interest",
"Public Offering--Volume and Other Discounts", "Public
Offering--Distribution of Units", "Frequent Buyer Program" in
Exhibit 3.
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(f) State whether the depositor, principal underwriter,
custodian or trustee, or any affiliated person of the foregoing may receive
profits or other benefits not included in answer to Item 13(a) or 13(d)
through the sale or purchase of the trust's securities or interests in such
securities, or underlying securities or interests in underlying securities,
and describe fully the nature and extent of such profits or benefits.
See "Risk Considerations" in Exhibit 3.
(g) State the percentage that the aggregate annual charges
and deductions for maintenance and other expenses of the trust bear to the
dividend and interest income from the trust property during the period covered
by the financial statements filed herewith.
Not Applicable.
Information Concerning the Operations of the Trust
16. Describe the procedure with respect to the acquisition of
underlying securities and the disposition thereof, and state the substance of
the provisions of any indenture or agreement pertaining thereto.
For Series of Equity Securities Trust, see "The Trust--
Organization", "The Trust--The Securities", "The Trust-
-Risk Considerations", "The Trust--Substitution of
Securities" and "Trust Administration--Portfolio
Supervision" in Exhibit 3.
18. (c) If any reserves or special funds are created out of income
or principal, state with respect to each such reserve or fund the purpose and
ultimate disposition thereof, and describe the manner of handling of same.
See "Rights of Unit Holders--Distributions" in
Exhibit 2.
23. Describe any bonding arrangement for officers, directors,
partners or employees of the depositor or principal underwriter of the trust,
including the amount of coverage and the type of bond.
The Trust and its Directors, officers and employees are covered by
a Stockbrokers Blanket Bond in the amount of $15,000,000, under a
Financial Institution Bond
Form 14.
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III. ORGANIZATION, PERSONNEL AND AFFILIATED PERSONS OF DEPOSITOR
Organization and Operations of Depositor
25. State the form of organization of the depositor of the trust,
the name of the state or other sovereign power under the laws of which the
depositor was organized and the date of organization.
The Depositor of the Trust, Reich & Tang Distributors L.P., is a
Limited Partnership organized under the laws of the State of
Delaware.
27. Describe the general character of the business engaged in by
the depositor including a statement as to any business other than that of
depositor of the trust. If the depositor acts or has acted in any capacity
with respect to any investment company or companies other than the trust,
state the name or names of such company or companies, their relationship, if
any, to the trust, and the nature of the depositor's activities therewith. If
the depositor has ceased to act in such named capacity, state the date of and
circumstances surrounding such cessation.
See "Trust Administration--Sponsor" in Exhibit 3.
Officials and Affiliated Persons of Depositor
28. (a) Furnish as at latest practicable date the following
information with respect to the depositor of the trust, with respect to each
officer, director, or partner of the depositor, and with respect to each
natural person directly or indirectly owning, controlling or holding with
power to vote 5% or more of the outstanding voting securities of the
depositor.
Reference is made to Exhibit E hereto.
(b) Furnish a brief statement of the business experience
during the last five years of each officer, director or partner of the
depositor.
Reference is made to Exhibit E hereto.
Companies Owning Securities of Depositor.
29. Furnish as at latest practicable date the following
information with respect to each company which directly or indirectly owns,
controls or holds with power to vote 5% or more of the outstanding voting
securities of the depositor.
Reference is made to Exhibit E hereto.
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Controlling Persons
30. Furnish as at latest practicable date the following
information with respect to any person, other than those covered by Items 28,
29 and 42, who directly or indirectly controls the depositor.
Reference is made to Exhibit E hereto.
IV. DISTRIBUTION AND REDEMPTION OF SECURITIES
Offering Price or Acquisition Valuation of Securities
of the Trust
44. (b) Furnish a specimen schedule showing the
components of the offering price of the trust's securities as at
the latest practicable date. Such schedule shall be in
substantially the following form.
See "Summary of Essential Information" in Exhibit 3.
Redemption Valuation of Securities of the Trust
46. (a) Furnish the following information with
respect to the method of determining the redemption or withdrawal
valuation of securities issued by the Trust:
(1) The source of quotations used to determine
the value of portfolio securities.
(2) Whether opening, closing, bid, asked or any
other price is used.
(3) Whether price is as of the day of sale or as
of any other time.
(4) A brief description of the methods used by registrant
for determining other assets and liabilities including
accrual for expenses and taxes (including taxes on
unrealized appreciation).
(5) Other items which registrant deducts from the net
asset value in computing redemption value of its
securities.
(6) Whether adjustments are made for fractions.
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For Equity Securities Trust, and in response to items 46(a)(1)
through (b) see "Summary of Essential Information", "Market for
Units", "Termination", "Public Offering--Offering Price",
"Liquidity--Sponsor Repurchase" and "Liquidity--Trustee
Redemption" in Exhibit 3.
(b) Furnish a specimen schedule showing the components of the
redemption price to the holders of the trust's securities as at the latest
practicable date. Such schedule shall be in substantially the following form.
See "Summary of Essential Information" in Exhibit 3.
VII. POLICY OF REGISTRANT
52. (a) Furnish the substance of the provisions of any indenture
or agreement with respect to the conditions upon which and the method of
selection by which particular portfolio securities must or may be eliminated
from assets of the trust or must or may be replaced by other portfolio
securities. If an investment advisor or other person is to be employed in
connection with such selection, elimination or substitution, state the name of
such person, the nature of any affiliation to the depositor, trustee of
custodian and any principal underwriter, and the amount of remuneration to be
received for such services. If any particular person is not designated in the
indenture or agreement, describe briefly the method of selection of such
person.
For Equity Securities Trust, see "Termination", "The
Trust--Substitution of Securities", "Trust
Administration--Portfolio Supervision" and "Trust
Administration--Trust Agreement and Amendment" and "Trust
Administration--Trust Termination" in Exhibit 2.
(c) Describe the policy of the trust with respect to the
substitution and elimination of the underlying securities of the trust with
respect to:
(1) The grounds for elimination and substitution;
(2) The type of securities which may be
substituted for any underlying security;
(3) Whether the acquisition of such substituted security
or securities would constitute the concentration of
investment in a particular industry or group of
industries or would conform to a policy of
concentration of
317716.2
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investment in a particular industry or group
of industries;
(4) Whether such substituted securities may be
the securities of another investment company;
and
(5) The substance of the provisions of any indenture or
agreement which authorize or restrict the policy of
the registrant in this regard.
See Item 52(a).
VIII. FINANCIAL AND STATISTICAL INFORMATION
59. Financial Statements filed herewith:
(c)(1) Balance Sheet of the Depositor for its last
fiscal year.
See Exhibit 4.
(c)(2) Profit and Loss Statement and Statement of Surplus for the
Depositor for its last fiscal year.
See Exhibit 4.
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SIGNATURE
Pursuant to the requirements of the Investment Company Act of
1940, the undersigned depositor of the Registrant has caused this Registration
Statement to be duly signed on behalf of the Registrant in the City and State
of New York, on the 16th day of November, 1995.
NEW YORK MUNICIPAL TRUST
SERIES 1 (and SUBSEQUENT SERIES);
NEW YORK DISCOUNT & ZERO COUPON FUND -
1ST SERIES (and SUBSEQUENT SERIES);
MUNICIPAL SECURITIES TRUST, SERIES 1 (and
SUBSEQUENT SERIES); 1ST DISCOUNT SERIES
(and SUBSEQUENT SERIES); HIGH INCOME
SERIES 1 (and SUBSEQUENT SERIES);
SHORT-INTERMEDIATE TERM SERIES 1 (and
SUBSEQUENT SERIES); MULTI-STATE SERIES 1
(and SUBSEQUENT SERIES);
INSURED MUNICIPAL SECURITIES TRUST,
SERIES 1 (MULTIPLIER PORTFOLIO)
(and SUBSEQUENT SERIES);
SERIES 1 (and SUBSEQUENT SERIES);
AND 5TH DISCOUNT SERIES (and
SUBSEQUENT SERIES);
MORTGAGE SECURITIES TRUST, CMO
SERIES 1 (and SUBSEQUENT SERIES)
EQUITY SECURITIES TRUST, SERIES 1
(and SUBSEQUENT SERIES)
(Name of Registrant)
REICH & TANG DISTRIBUTORS L.P.
(the Depositor)
By: Reich & Tang Asset Management, Inc.,
as General Partner
By:/s/ Peter J. DeMarco
Peter J. DeMarco
Executive Vice President
Attest:Lorraine C. Hysler
Title: Secretary
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Reich & Tang
Distributors L.P.
Financial Statements and
Supplemental Information
December 31, 1994
(Confidential Treatment Requested)
317994.1
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SEC FILE NUMBER
8-43429
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
ANNUAL AUDITED REPORT
FORM X-17A-5
PART III
FACING PAGE
Information Required of Brokers and Dealers
Pursuant to Section 17 of the
Securities Exchange Act of 1934 and Rule 17a-5 Thereunder
REPORT FOR THE PERIOD BEGINNING 01/01/94 AND ENDING 12/31/94
MM/DD/YY MM/DD/YY
A. REGISTRANT IDENTIFICATION
OFFICIAL USE ONLY
NAME OF BROKER-DEALER:
Reich & Tang Distributors L.P. FIRM I.D. NO.
ADDRESS OF PRINCIPAL PLACE OF BUSINESS: (Do not use P.O. Box No.)
600 Fifth Avenue
(No. and Street)
New York, New York 10020
(City) (State) (Zip Code)
NAME AND TELEPHONE NUMBER OF PERSON TO CONTACT IN REGARD TO THIS
REPORT:
Richard De Sanctis (212) 830-5200
(Area Code - Telephone No.)
B. ACCOUNTANT IDENTIFICATION
317994.1
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INDEPENDENT PUBLIC ACCOUNTANT whose opinion is contained in this
Report*
Price Waterhouse
(Name - if individual, state last, first, middle name)
160 Federal Street, Boston, MA 02110
(Address) (City) (State) (Zip Code)
CHECK ONE:
X Certified Public Accountant
___ Public Accountant
___ Accountant not resident in United States or any of
its possessions
FOR OFFICIAL USE ONLY
SEC 1410 (3-91)
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* Claims for exemption from the requirement that the annual
report be covered by the opinion of an independent public
accountant must be supported by a statement of facts and
circumstances relied on as the basis for the exemption. See
section 240.17a-5(e)(2).
317994.1
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OATH OR AFFIRMATION
I, Richard De Sanctis, swear (or affirm) that, to the best of my knowledge and
belief, the accompanying financial statement and supporting schedules
pertaining to the firm of Reich & Tang Distributors, L.P., as of December 31,
1994, are true and correct. I further swear (or affirm) that neither the
company nor any partner, proprietor, principal officer or director has any
proprietary interest in any account classified solely as that of a customer,
except as follows:
/s/
Signature
Treasurer, Reich & Tang Asset
Management, Inc.
as General Partner of Reich &
Tang Distributors L.P.
Title
/s/
Notary Public
This report** contains (check all applicable boxes): X (a) Facing page. X (b)
Statement of Financial Condition. X (c) Statement of Income (Loss).
X (d) Statement of Cash Flows.
X (e) Statement of Changes in Stockholders' Equity or
Partners' or Sole Proprietor's Capital.
X (f) Statement of Changes in Liabilities Subordinated to Claims of
Creditors.
X (g) Computation of Net Capital.
___ (h) Computation for Determination of Reserve Requirements
Pursuant to Rule 15c3-3.
___ (i) Information Relating to the Possession or Control
Requirements Under Rule 15c3-3.
___ (j) A Reconciliation, including appropriate explanation, of the
Computation of Net Capital Under Rule 15c3-1 and the Computation
for Determination of the Reserve Requirements Under Exhibit A of
Rule 15c3-3.
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** For conditions of confidential treatment of certain portions of this
filing, see section 240.17a-5(e)(3).
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___ (k) A Reconciliation between the audited and unaudited Statements
of Financial Condition with respect to methods of consolidation.
XX (l) An Oath or Affirmation.
___ (m) A copy of the SIPC Supplemental Report.
XX (n) A report describing any material inadequacies found to
exist or found to have existed since the date of the
previous audit.
X Statement pursuant to Rule 15c-3.
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160 Federal Street Telephone 617 439 4390
Boston, MA 02110
Price Waterhouse LLP
Report of Independent Accountants
February 16, 1995
To the Partners of Reich & Tang Distributors L.P.
In our opinion, the accompanying statement of financial condition and the
related statements of income, of changes in partners' capital and of cash
flows present fairly, in all material respects, the financial position of
Reich & Tang Distributors L.P. (the Partnership), at December 31, 1994 and the
results of its operations and cash flows for the year then ended, in
conformity with generally accepted accounting principles. These financial
statements are the responsibility of the management of Reich & Tang Asset
Management, Inc., the General Partner of the Partnership; our responsibility
is to express an opinion on these financial statements based on our audit. We
conducted our audit of these statements in accordance with generally accepted
auditing standards which 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, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for the opinion expressed above.
The sole General Partner and the sole Limited Partner of Reich & Tang
Distributors L.P. are Reich & Tang Asset Management, Inc. and Reich & Tang
Asset Management, L.P., respectively. As disclosed in Note 2 to the financial
statements, Reich & Tang Distributors L.P. has extensive transactions with
Reich & Tang Asset Management, L.P. Because of this relationship, it is
possible that the terms of these transactions are not the same as those that
would result from transactions among wholly unrelated parties.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplementary information included
in Schedules I, II, and III is presented for purposes of additional analysis
and is not a required part of the basic financial statements, but is
supplementary information required by Rule 17a-5 under the Securities Exchange
Act of 1934. Such information has been subjected to the auditing procedures
applied in the audit of the
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basic financial statements and, in our opinion, is fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
/s/
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Reich & Tang Distributors L.P.
Statement of Income
For the Year Ended December 31, 1994
Assets
Cash and cash equivalents $ 545,043
Distribution assistance fees receivable -
affiliates (Note 2) 15,020
Commissions receivable 117,092
Other assets 31,176
Total assets $ 708,331
Liabilities and Partners' Capital
Distribution assistance fees payable -
affiliates (Note 2) $ 366,261
Accrued expenses 16,893
Distribution payable to general partner 2,000
385,154
Partners' capital:
General partner 5,232
Limited partner 317,945
Total partners' capital 323,177
Total liabilities and partners' capital $ 708,331
See the accompanying notes to the financial statements.
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Reich & Tang Distributors L.P.
Statement of Income
For the Year Ended December 31, 1994
Revenue:
Distribution assistance fees -
affiliates (Note 2) $ 4,832,793
Net commission income 1,182,641
Interest income 21,244
6,036,678
Expenses:
Distribution assistance fees -
affiliates (Note 2) 4,832,793
Other operating expenses 18,909
4,851,702
Net income $ 1,184,976
See the accompanying notes to the financial statements.
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Reich & Tang Distributors L.P.
Statement of Changes in Partners' Capital
For the Year Ended December 31, 1994
General Limited
Partner Partner Total
Balance at beginning
of year $ 6,382 $ 631,819 $ 638,201
Net income 11,850 1,173,126 1,184,976
Distributions (13,000) (1,487,000) (1,500,000)
Balance at end of year $ 5,232 $ 317,945 $ 323,177
Note: As discussed in Note 1, prior to October 1, 1994, the
General Partner was New England Investment Companies, Inc.
and the Limited Partner was New England Investment
Companies L.P. (NEIC L.P.). Effective October 1, 1994
Reich & Tang Asset Management, Inc. and Reich & Tang Asset
Management, L.P., both indirect wholly owned subsidiaries
of NEIC L.P., became General Partner and Limited Partner,
respectively.
See the accompanying notes to the financial statements.
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Reich & Tang Distributors L.P.
Statement of Cash Flows
For the Year Ended December 31, 1994
Cash flows from operating activities
Net income $ 1,184,976
Change in assets and liabilities
Increase in receivables (18,400)
Increase in other assets (10,549)
Decrease in accounts payable and
accrued expenses (52,577)
Net cash provided by operating activities (1,103,450)
Cash flows used in financing activities
Distributions to partners (1,500,000)
Net decrease in cash and cash equivalents (396,550)
Cash and cash equivalents
Beginning of year 941,593
End of year $ 545,043
See the accompanying notes to the financial statements.
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Reich & Tang Distributors L.P.
Notes to Financial Statements
1. Nature of Business and Significant Accounting Policies
Nature of Business
Reich & Tang Distributors L.P.'s (the Partnership's) business consists
primarily of providing brokerage services for investment companies
sponsored by Reich & Tang Asset Management, L.P. (RTAM L.P.) and
institutional and individual clients, as well as distribution assistance
services for such sponsored investment companies. The Partnership is a
regulated broker/dealer.
The Partnership was formed under the Delaware Revised
Uniform Limited Partnership Act and will continue to exist
until December 31, 2086 unless sooner terminated under the
provisions of the Partnership Agreement. Effective October
1, 1994, the sole General Partner of the Partnership is
Reich & Tang Asset Management, Inc. (RTAM, Inc.) and the
sole Limited Partner of the Partnership is RTAM L.P. whose
general partner is also RTAM, Inc. Prior to October 1, 1994
the General Partner was New England Investment Companies,
Inc. and the Limited Partner was New England Investment
Companies, L.P. (NEIC). RTAM, Inc. and RTAM L.P. are
indirect wholly owned subsidiaries of NEIC. Under the terms
of the Partnership Agreement, the General Partner does not
receive a fee for its services. The Partnership's profits
and losses are allocated in proportion to the capital
contributions of the Partners: 1% to the General Partner
and 99% to the Limited Partner.
A summary of the Partnership's significant accounting policies follows:
Cash Equivalents
The Partnership considers all investments which are readily convertible
into cash and highly liquid debt instruments purchased with an original
maturity of three months or less to be cash equivalents. All of the
Partnership's cash is invested in the Short Term Income Fund, Inc. which
is managed by RTAM L.P.
Income Recognition
Commissions are recorded on a settlement date basis which does not
differ materially from a trade date basis. Commission income is recorded
net of fees paid to the clearing and execution broker. Distribution
assistance fees
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Reich & Tang Distributors L.P.
Notes to Financial Statements
are recorded as earned by the Partnership as a percentage of
a fund's average daily net assets.
Income Taxes
The Partnership is exempt from both federal and state income taxes and,
accordingly, the financial statements do not include a related
provision. The tax effect of the operations accrues to and is reportable
by the individual partners of the Partnership. The Partnership is
subject to the New York City unincorporated business tax less an
exemption amount allowed in respect of the Partners' proportionate share
of Partnership net income.
2. Related Party Transactions
Pursuant to its agreements with the sponsored mutual funds described
above, the Partnership in conjunction with the funds' sponsor, RTAM
L.P., may make payments for the distribution and servicing of the
sponsored funds to other organizations with whom the Partnership has
entered into written agreements.
Accordingly, the Partnership receives distribution assistance fees from
the sponsored funds for its distribution and administration services and
remits them entirely to RTAM L.P. who acts as paying agent for the
Partnership and the funds in making the payments to the other
organizations described above.
Since October 1, 1994 RTAM L.P. has borne all operational expense of the
Partnership, other than those set forth in the statement of income.
Effective October 1, 1994 RTAM L.P. has entered into an agreement
whereby it bears all distribution expenses of the Partnership in excess
of distribution fees and reimbursements received by the Partnership from
the sponsored mutual funds. Prior to October 1, 1994, NEIC L.P. assumed
all operational expenses of the Partnership, other than those set forth
in the statement of income. In addition, from January 1, 1994 to
September 30, 1994, NEIC L.P. had an agreement with the Partnership
whereby it assumed all distribution expenses of the Partnership in
excess of distribution fees and reimbursements received by the
Partnership from the sponsored mutual funds. The operational expense
assumed by RTAM L.P. and NEIC L.P. for the year ending December 31, 1994
was approximately $350,000.
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Reich & Tang Distributors L.P.
Notes to Financial Statements
3. Customer Transactions
The Partnership clears its customers' securities transactions through an
affiliate of Wertheim Schroder & Co., Incorporated ("Wertheim Schroder")
on a fully disclosed basis. The affiliate of Wertheim Schroder reflects
all such securities transactions on its books and records them in
accounts which it carries in the names of such customers. Accordingly,
the Partnership does not hold funds or securities for, or owe funds or
securities to, its customers. The Partnership is currently exempt from
the requirement to maintain a "Special Reserve Account for the Exclusive
Benefit of Customers".
4. Net Capital
The Partnership is subject to the net capital rule of the Securities and
Exchange Commission. This rule prohibits a broker/dealer from engaging
in securities transactions when its aggregate indebtedness exceeds 15
times its net capital as those terms are defined in the rule. Rule
15c3-1 also provides that equity capital may not be withdrawn if the
resulting net capital ratio would exceed 10 to 1. As of December 31,
1994, the Partnership had net capital of $171,080 which was $145,403 in
excess of its required net capital of $25,677. The Partnership's net
capital ratio of aggregate indebtedness to net capital was 2.25 to 1.
5. Off-Balance-Sheet Risk and Concentration of Credit Risk
As discussed in Note 3, the Partnership's customers' securities
transactions are introduced on a fully-disclosed basis with its clearing
broker/dealer. The clearing broker/dealer carries all of the accounts of
the customers of the Partnership and is responsible for execution,
collection of and payment of funds, and receipt and delivery of
securities relative to customer transactions. Off-balance-sheet risk
exists with respect to these transactions due to the possibility that
customers may be unable to fulfill their contractual commitments wherein
the clearing broker/dealer may charge any losses it incurs to the
Partnership. The Partnership seeks to minimize this risk through
procedures designed to monitor the credit worthiness of its customers
and by ensuring that customer
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Reich & Tang Distributors L.P.
Notes to Financial Statements
transactions are executed properly by the clearing
broker/dealer.
Commissions receivable represent amounts due the Partnership from its
clearing broker relating to customer securities transactions introduced
by the Partnership.
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Reich & Tang Distributors L.P.
Computation of Net Capital Pursuant to Rule 15c3-1
December 31, 1994 Schedule I
Total partners' capital from the Statement of
Financial Condition $ 323,177
Deductions
Nonallowable assets
Receivables $ 15,020
Other assets 31,176
Other charges, insurance deductible
in excess of $5,000 95,000 141,196
Net capital before haircuts
on securities 181,981
Haircuts on securities
Liquid asset funds 10,901
Net capital $ 171,080
Aggregate indebtedness
Included in the Statement of
Financial Condition $ 385,154
Computation of basic net capital
requirement
Minimum net capital required
(greater of 6-2/3% of aggregate
indebtedness or $25,000) $ 25,677
Net capital in excess of minimum
requirements $ 145,403
Ratio of aggregate indebtedness to
net capital 2.25 to 1
NOTE: There are no material differences between the computation
of net capital and that included in the Company's unaudited
December 31, 1994 FOCUS Report.
317994.1
<PAGE>
Reich & Tang Distributors L.P.
Statement Pursuant to Rule 15c3-3
December 31, 1994 Schedule II
As more fully described in Note 3 of the Notes to Financial Statements, the
Partnership clears all securities transactions on a fully disclosed basis and
does not hold funds or securities of customers. Accordingly, the Partnership
is exempt from the requirement to maintain a "Special Reserve Account for the
Exclusive Benefit of Customers" under provisions of SEC Rule 15c3-3 based on
Paragraph k(2)(ii) of the Rule.
317994.1
<PAGE>
Reich & Tang Distributors L.P.
Statement Regarding Changes in Liabilities
Subordinated to Claims of General Creditors
December 31, 1994 Schedule III
The Company did not have any liabilities subordinated to claims of general
creditors during the year ended December 31, 1994.
317994.1
<PAGE>
160 Federal Street Telephone 617 439 4390
Boston, MA 02110
Price Waterhouse LLP
Supplementary Report of Independent Accountants
on Internal Accounting Control Pursuant to SEC Rule 17a-5
February 16, 1995
To the Partners of
Reich & Tang Distributors L.P.
In planning and performing our audit of the financial statements of Reich &
Tang Distributors L.P. (the "Company") for the year ended December 31, 1994,
we considered its internal control structure in order to determine our
auditing procedures for the purpose of expressing our opinion on the financial
statements and not to provide assurance on the internal control structure.
Also, as required by Rule 17a-5(g)(l) of the Securities and Exchange
Commission, we have made a study of the practices and procedures (including
tests of compliance with such practices and procedures) followed by the
Company that we considered relevant to the objectives stated in Rule 17a-5(g)
in making the periodic computations of aggregate indebtedness and net capital
under Rule 17a-3(a)(11) and the procedures for determining compliance with the
exemptive provisions of Rule 15c3-3. We did not review the practices and
procedures followed by the Company (i) in making the quarterly securities
examinations, counts, verifications and comparisons, and the recordation of
differences required by Rule 17a-13, (ii) in complying with the requirements
for prompt payment for securities under Section 8 of Regulation T of the Board
of Governors of the Federal Reserve System, or (iii) in obtaining and
maintaining physical control of all fully paid and excess margin securities
required by Rule 15c3-3 because the Company does not carry security accounts
for customers or perform custodial functions relating to customer securities.
The management of Reich & Tang Asset Management, Inc., the General Partner of
the Company, is responsible for establishing and maintaining an internal
control structure and of the practices and procedures referred to in the
preceding paragraph. In fulfilling this responsibility, estimates and
judgments by management are required to assess the expected benefits and
related costs of internal control structure policies and procedures and the
practices and procedures referred to in the preceding paragraph and to assess
whether those practices and procedures can be expected to achieve the
Commission's
317994.1
<PAGE>
To the Partners
Reich & Tang Distributors L.P.
Page 2
February 16, 1995
above-mentioned objectives. Two of the objectives of an internal control
structure and the practices and procedures are to provide management with
reasonable, but not absolute, assurance that assets for which the Company has
responsibility are safeguarded against loss from unauthorized use or
disposition, and that transactions are executed in accordance with
management's authorization and recorded properly to permit preparation of
financial statements in conformity with generally accepted accounting
principles. Rule 17a-5(g) lists additional objectives of the practices and
procedures listed in the preceding paragraph.
Because of inherent limitations in any internal control structure or the
practices and procedures referred to above, errors or irregularities may occur
and not be detected. Also, projection of any evaluation of them to future
periods is subject to the risk that they may become inadequate because of
changes in conditions or that the effectiveness of their design and operation
may deteriorate.
Our consideration of the internal control structure would not necessarily
disclose all matters in the internal control structure that might be material
weaknesses under standards established by the American Institute of Certified
Public Accountants. A material weakness is a condition in which the design or
operation of the specific internal control structure elements does not reduce
to a relatively low level the risk that errors or irregularities in amounts
that would be material in relation to the financial statements being audited
may occur and not be detected within a timely period by employees in the
normal course of performing their assigned functions. However, we noted no
matters involving the internal control structure that we consider to be
material weaknesses as defined above.
We understand that practices and procedures that accomplish the objectives
referred to in the third paragraph of this report are considered by the
Commission to be adequate for its purposes in accordance with the Securities
Exchange Act of 1934 and related regulations, and that practices and
procedures that do not accomplish such objectives in all material respects
indicate a material inadequacy for such purposes. Based on this understanding
and on our study, we believe that the Company's practices and procedures were
adequate at December 31, 1994 to meet the Commission's objectives.
317994.1
<PAGE>
To the Partners
Reich & Tang Distributors L.P.
Page 3
February 16, 1995
This report is intended solely for the use of management, the Securities and
Exchange Commission, the National Association of Securities Dealers, Inc. and
other regulatory agencies which rely on Rule 17a-5(g) under the Securities
Exchange Act of 1934 and
should not be used for any other purpose.
/s/
317994.1
EXHIBIT E
As of November 14, 1995
I. Information as to each officer, director or partner of the Depositor,
and with respect to each natural person directly or indirectly owning,
controlling or holding with power to vote 5% or more of the outstanding
voting securities of the Depositor.
Name Title/Position Business Address
Steven W. Duff Director of the General 600 Fifth Avenue
Partner*, President of the New York, NY 10020
Mutual Funds Group of the
Depositor
Richard E. Smith Director of the General 600 Fifth Avenue
Partner, President of the New York, NY 10020
Capital Management Group of
the Depositor
Peter S. Voss President and Director of the600 Fifth Avenue
General Partner New York, NY 10020
Neal G. Ryland Director of the General 600 Fifth Avenue
Partner New York, NY 10020
Peter J. DeMarco Executive Vice President of 600 Fifth Avenue
the Mutual Funds Group of New York, NY 10020
the Limited Partner*
The following individuals own 5% or more of the General Partner or any Limited
Partner of the Depositor.
Oscar L. Tang President; Stockholder 600 Fifth Avenue
New York, NY 10020
Robert F. Hoerle Stockholder 600 Fifth Avenue
New York, NY 10020
Joseph H. Reich Stockholder 600 Fifth Avenue
New York, NY 10020
*The "General Partner" of the Depositor refers to Reich & Tang Asset
Management, Inc. ("RTAM") and the "Limited Partner referenced herein refers to
Reich & Tang Asset Management L.P. ("RTAM LP")
318148.1
<PAGE>
As of the Date hereof, none of the referenced persons own any
Units of the Trust.
II. The business experience during the last five years of each officer and
director of the Depositor.
Steven W. Duff - President of the Mutual Funds Division of RTAM LP since
September 1994. Mr. Duff was formerly Director of Mutual Fund Administration
at NationsBank which he was associated with from June 1981 to August 1994. Mr.
Duff serves as officer and director for numerous mutual funds advised by RTAM
LP.
Richard De Sanctis - Treasurer of RTAM LP since September 1993. Mr. De
Sanctis was formerly Controller of Reich & Tang, Inc. from January 1991 to
September 1993 and Vice President and Treasurer of Cortland Financial Group,
Inc., and Vice President of Cortland Distributors, Inc. from 1989 to December
1990. Mr. De Sanctis serves as Treasurer for numerous mutual funds advised by
RTAM LP.
Bernadette N. Finn - Vice President of RTAM LP since September 1993. Ms.
Finn was formerly Vice President and Assistant Secretary of Reich & Tang, Inc.
which she was associated with from September 1970 to September 1993. Ms. Finn
is also Secretary of numerous mutual funds advised by RTAM LP.
Peter S. Voss - Director and General Partner of RTAM since 1994;
President and CEO of NEIC LP since 1993; Chairman and Director of Draycott
Partners, Ltd. since 1993; Chairman of NEIC LP since 1992; and Director of New
England Mutual Life Insurance Co. since 1993. Formerly Group Executive Vice
President of Bank of America April 1992 to October 1992; and Executive Vice
President of Security Pacific National Bank from 1988 through 1992 during
which time Mr. Voss was also CEO of Hoare Govett Companies, a subsidiary of
Security Pacific National Bank.
G. Neal Ryland - Director of RTAM since 1994; Executive Vice President, CFO
and Treasurer of NEIC since 1993. Formerly CFO of The Boston Company From 1989
to 1993.
Richard E. Smith, III - President of Capital Management Group of RTAM LP
since 1994; Executive Vice President of Rhode Island Hospital Trust from 1993
to 1994. Formerly President and CEO of USF & G Review Management Corporation
from 1988 to 1992.
Peter J. DeMarco - Executive Vice President of RTAM LP since 1995.
Formerly Managing Director of Bear, Stearns & Co. Inc. since 1981.
Lorraine C. Hysler - Ms. Hysler has been Secretary since July 1994. Ms.
Hysler is Assistant Secretary of New England Investment Companies, Inc.
("NEIC") since September 1993. She was a Vice President of the Mutual Funds
Group of New England Investment Companies, L.P. ("NEIC LP") from September
1993 until July 1994. Ms. Hysler has been
318148.1
<PAGE>
a Vice President of the Mutual Funds Group of RTAM LP since July 1994.
Ms. Hysler joined Reich & Tang, Inc. in May 1977.
Edward N. Wadsworth - Mr. Wadsworth has been Clerk since July 1994. Mr.
Wadsworth is Executive Vice President, General Counsel, Clerk and Secretary of
NEIC since December 1989. He was Senior Vice President and Associate General
Counsel of The New England from 1984 until December 1992.
Richard I. Weiner - Mr. Weiner has been Vice President since July 1994.
Mr. Weiner has been Vice President of NEIC since September 1993. He was a Vice
President of the Capital Management Group of NEIC LP from September 1993 until
July 1994. Mr. Weiner joined Reich & Tang, Inc. in August 1970 and served as a
Vice President of such since September 1982.
III. Each Company which directly or indirectly owns, controls or holds with
power to vote 5% or more of the outstanding voting securities of the
depositor.
NEIC LP : Owns 99.5% of the General Partner
New England Mutual Life : Owns 67.3 of the total partnership units of
Insurance Company NEIC LP
Reich & Tang, Inc. : Owns 22.6% of the total
600 Fifth Avenue partnership units of NEIC LP
New York, NY 10020
318148.1
