Registration No. 333-01285
1940 Act No. 811-05903
Securities and Exchange Commission
Washington, D.C. 20549
Amendment No. 1 to Form S-6
For Registration Under the Securities Act of 1933 of Securities of
Unit Investment Trusts Registered on Form N-8B-2
A. Exact Name of Trust: The First Trust Special Situations Trust,
Series 144
B. Name of Depositor: Nike Securities L.P.
C. Complete Address of Depositor's
Principal Executive Offices: 1001 Warrenville Road
Lisle, Illinois 60532
D. Name and Complete Address of
Agents for Service: Nike Securities L.P.
Attention: James A. Bowen
Suite 300
1001 Warrenville Road
Lisle, Illinois 60532
E. Title and Amount of Securities
Being Registered: An indefinite number of Units
pursuant to Rule 24f-2 promulgated
under the Investment Company Act of
1940, as amended.
F. Proposed Maximum Offering Price
to the Public of the Securities Being
Registered: Indefinite
G. Amount of Filing Fee : $0.00
H. Approximate Date of Proposed Sale to the Public:
XXX Check if it is proposed that this filing will become effective on
December 4, 1996 at 2:00 p.m. pursuant to Rule 487.
The registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its
effective date until the registrant shall file a further
amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance
with Section 8(a) of the Securities Act of 1933 or until the
Registration Statement shall become effective on such date
as the Commission, acting pursuant to said Section 8(a), may
determine.
The First Trust Special Situations Trust, Series 144
Cross-Reference Sheet
(Form N-8B-2 Items required by Instructions as to the
Prospectus in Form S-6)
Form N-8B-2 Item Number Form S-6 Heading in Prospectus
I. Organization and General Information
1. (a) Name of trust Prospectus front cover
(b) Title of securities issued Summary of Essential Information
2. Name and address of each depositor Information as to Sponsor,
Trustee and Evaluator
3. Name and address of trustee Information as to Sponsor,
Trustee and Evaluator
4. Name and address of principal Underwriting
underwriters
5. State of organization of trust The First Trust Special Situations
Trust
6. Execution and termination The First Trust Special Situations
of trust agreement Trust; Other Information
7. Changes of name *
8. Fiscal Year *
9. Litigation *
II. General Description of the Trust and Securities of the Trust
10. (a) Registered or bearer securities Rights of Unit Holders
(b) Cumulative or distributive securities
The First Trust Special Situations Trust
(c) Redemption Rights of Unit Holders
(d) Conversion, transfer, etc. Rights of Unit Holders
(e) Periodic payment plan certificates *
(f) Voting rights Rights of Unit Holders;
Other Information
(g) Notice of certificateholders Rights of Unit Holders;
Other Information
(h) Consents required Rights of Unit Holders; Other
Information
(i) Other provisions The First Trust Special
Situations Trust
11. Types of securities comprising units The First Trust
Special Situations Trust
12. Certain information regarding
periodic payment plan certificates *
13. (a) Load, fees, expenses, etc. Summary of Essential
Information; Public Offering; The First Trust Special
Situations Trust
(b) Certain information regarding *
periodic payment plan
(c) Certain percentages Summary of Essential
Information; The First Trust
Special Situations Trust; Public
Offering
(d) Difference in price offered for Public Offering
any class of transactions to any
class or group of individuals
(e) Certain other loan fees, Rights of Unit Holders
expenses, etc. payable by holders
(f) Certain profits receivable by The First Trust Special
Situations Trust
depositor, principal underwriters,
trustee or affiliated persons
(g) Ratio of annual charges to income *
14. Issuance of trust's securities Rights of Unit Holders
15. Receipt and handling of payments *
from purchasers
16. Acquisition and disposition of under- The First Trust Special
lying securities Situations Trust; Rights
of Unit Holders
17. Withdrawal or redemption The First Trust Special
Situations Trust; Public
Offering; Rights of Unit Holders
18. (a) Receipt, custody and disposition Rights of Unit Holders
of income
(b) Reinvestment of distributions Rights of Unit Holders
(c) Reserves or special funds Information as to
Sponsor, Trustee and
Evaluator
(d) Schedule of distributions *
19. Records, accounts and reports Rights of Unit Holders
20. Certain miscellaneous provisions of
trust agreement
(a) Amendment Other Information
(b) Termination Other Information
(c) and (d) Trustee, removal and Information as to
successor Sponsor, Trustee and
Evaluator
(e) and (f) Depositor, removal and Information as
successor to Sponsor, Trustee
and Evaluator
21. Loans to security holders *
22. Limitations on liability The First Trust Special
Situations Trust;
Information as to Sponsor,
Trustee and Evaluator
23. Bonding arrangements Contents of Registration
Statement
24. Other material provisions of trust *
agreement
III. Organization, Personnel and Affiliated Persons of Depositor
25. Organization of depositor Information as to Sponsor,
Trrustee and Evaluator
26. Fees received by depositor *
27. Business of depositor Information as to Sponsor,
Trustee and Evaluator
28. Certain information as to officials *
and affiliated persons of depositor
29. Voting securities of depositor *
30. Persons controlling depositor *
31. Payment by depositor for certain *
services rendered to trust
32. Payment by depositor for certain *
other services rendered to trust
33. Remuneration of other persons for *
certain services rendered to trust
34. Remuneration of other persons for *
certain services rendered to trust
IV. Distribution and Redemption
35. Distribution of trust's securities Public Offering
securities by states
36. Suspension of sales of trust's securities *
37. Revocation of authority to distribute *
38. (a) Method of distribution Public Offering
(b) Underwriting agreements Public Offering;
Underwriting
(c) Selling agreements Public Offering
39. (a) Organization of principal Information as to
underwriters Sponsor, Trustee and
Evaluator
(b) N.A.S.D. membership of Information as to
principal underwriters Sponsor, Trustee and
Evaluator
40. Certain fee received by principal See Items 13(a) and
underwriters (13(e)
41. (a) Business of principal Information as to
underwriters Sponsor, Trustee and
Evaluator
(b) Branch offices of principal
underwriters *
(c) Salesmen of principal underwriters *
42. Ownership of trust's securities by
certain persons *
43. Certain brokerage commissions received
by principal underwriters *
44. (a) Method of valuation Summary of Essential
Information; The First
Trust Special Situations
Trust;
Public Offering
(b) Schedule as to offering price *
(c) Variation in offering price to Public Offering
certain persons
45. Suspension of redemption rights *
46. (a) Redemption Valuation Rights of Unit Holders
(b) Schedule as to redemption price *
47. Maintenance of position in underlying Public Rights
securities Offering; of Unit Holders
V. Information Concerning the Trustee or Custodian
48. Organization and regulation of Information as to Sponsor,
trustee Trustee and Evaluator
49. Fees and expenses of trustee The First Trust Special
Situations Trust
50. Trustees lien The First Trust Special
Situations Trust
VI. Information Concerning the Insurance of Holders of
Securities
51. Insurance of holders of trust's securities *
VII. Policy of Registrant
52. (a) Provisions of trust agreement The First Trust Special
agreement with respect to Situations Trust;
selection or elimination of Rights of Unit Holders
underlying securities
(b) Transactions involving elimination *
of underlying securities
(c) Policy regarding substitution or The First Trust Special Situations
elimination of underlying Trust; Rights of Unit Holders
securities
(d) Fundamental policy not otherwise *
covered
53. Tax status of Trust The First Trust Special
Situations Trust
VIII. Financial and Statistical Information
54. Trust's securities during last ten years *
55. Certain information regarding periodic
payment plan certificates
56. Certain information regarding periodic
payment plan certificates
57. Certain information regarding periodic *
payment plan certificates
58. Certain information regarding periodic
payment plan certificates
59. Financial statements (Instruction 1(b) Report of Independent Auditors;
Statement to Form S-6) of Net Assets
_______________________________
* Inapplicable, answer negative or not required.
First Trust U.S. Treasury Securities Trust, Short-Term, Series 7
First Trust U.S. Treasury Securities Trust, Short-Intermediate
Series 8
The Trust. The First Trust (registered trademark) Special Situations
Trust, Series 144 consists of the underlying separate unit investment
trusts set forth above. The various trusts are collectively referred to
herein as the "Trusts." First Trust U.S. Treasury Securities Trust,
Short-Term, Series 7 is individually referred to herein as the "Short-
Term Trust." First Trust U.S. Treasury Securities Trust, Short-
Intermediate, Series 8 is individually referred to herein as the "Short-
Intermediate Trust." Each Trust consists of a portfolio of taxable U.S.
Treasury Securities that are backed by the full faith and credit of the
United States Government, delivery statements relating to contracts for
the purchase of certain such securities and an irrevocable letter of
credit (the "Securities"). All of the U.S. Treasury Securities in the
Short-Term Trust consist of maturities of approximately 1.5 to 3.5 years
which are "laddered" to return approximately 40% of the Unit holders'
principal in 1998, 40% in 1999 and 20% in 2000. All of the U.S. Treasury
Securities in the Short-Intermediate Trust consist of maturities of
approximately 3 to 7 years which are "laddered" to return approximately
20% of the Unit holders' principal in 1999, 20% in 2000, 20% in 2001,
20% in 2002 and 20% in 2003.
The objective of each of the Trusts is to obtain safety of capital and
current monthly distributions of interest through an investment in a
fixed portfolio of Securities. The Short-Term Trust contains a
"laddered" portfolio to provide flexibility of principal investment with
maturities ranging from 1998 to 2000. The average weighted maturity of
the Short-Term Trust is 2.49 years. The Short-Intermediate Trust
contains a "laddered" portfolio to provide flexibility of principal
investment with maturities ranging from 1999 to 2003. The average
weighted maturity of the Short-Intermediate Trust is 4.88 years.
With the deposit of the Securities in the Trusts on December 4, 1996,
the Initial Date of Deposit, the Sponsor established for each Trust a
percentage relationship between the principal amount of Securities of
specified interest rates and ranges of maturities in the related
Portfolio. From time to time following the Initial Date of Deposit, the
Sponsor may deposit additional Securities in the Trusts and Units may be
continuously offered for sale to the public by means of this Prospectus
resulting in a potential increase in the outstanding number of Units of
a Trust. Any additional Securities deposited in a Trust will maintain,
as far as is practicable, the original percentage relationship between
the principal amounts of Securities of specified interest rates and
ranges of maturities in the original Portfolio of such Trust.
UNITS OF THE TRUSTS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
BY, ANY BANK, AND UNITS ARE NOT FEDERALLY INSURED OR OTHERWISE PROTECTED
BY THE FEDERAL DEPOSIT INSURANCE CORPORATION AND INVOLVE INVESTMENT RISK
INCLUDING LOSS OF PRINCIPAL.
The guaranteed payment of interest and principal afforded by the
Securities may make an investment in the Trusts particularly well suited
for purchase by Individual Retirement Accounts, Keogh Plans, pension
funds and other tax-deferred retirement plans. In addition, the ability
to buy single Units (minimum purchase $1,000, $250 for tax-deferred
retirement plans such as IRA accounts) during the initial offering
period at a Public Offering Price per Unit of approximately $10.00
enables such investors to tailor the dollar amount of their purchases of
Units to take the maximum possible advantage of the annual deductions
available for contributions to such plans. Investors should consult with
their tax advisers before investing. See "Why are Investments in a Trust
Suitable for Retirement Plans?"
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
First Trust (registered trademark)
The date of this Prospectus is December 4, 1996
Page 1
STANDARD & POOR'S RATINGS GROUP, A DIVISION OF THE MCGRAW-HILL COMPANIES
("STANDARD & POOR'S") HAS RATED UNITS OF EACH TRUST "AAA." THIS IS THE
HIGHEST RATING ASSIGNED BY STANDARD & POOR'S. SEE "WHAT IS THE RATING OF
THE UNITS?" AND "DESCRIPTION OF STANDARD & POOR'S RATING."
Attention Foreign Investors: Your interest income from the Trusts may be
exempt from federal withholding taxes if you are not a United States
citizen or resident and certain conditions are met. See "What is the
Federal Tax Status of Unit Holders?"
For Information on Estimated Current Return (if applicable) and
Estimated Long-Term Return including the estimated life of the portfolio
of each of the Trusts, see "Special Information" for each Trust.
Estimated cash flows for the Trusts are set forth herein under
"Estimated Cash Flows to Unit Holders."
The Public Offering Price per Unit is equal to the aggregate offering
price of the Securities in the portfolio of a Trust divided by the
number of Units outstanding, plus a sales charge of 1.85% of the Public
Offering Price (1.885% of the net amount invested) for the Short-Term
Trust and 1.95% of the Public Offering Price (1.989% of the net amount
invested) for the Short-Intermediate Trust. In addition, on transactions
entered into for settlement after December 9, 1996, there will be added
an amount equal to accrued interest from December 9, 1996 to the date of
settlement (three business days after order) less distributions from the
Interest Account subsequent to December 9, 1996. The secondary market
Public Offering Price per Unit will be equal to the aggregate bid price
of the Securities in the portfolio of a Trust divided by the number of
Units outstanding, plus a sales charge of 1.85% of the Public Offering
Price (1.885% of the net amount invested) for the Short-Term Trust and
1.95% of the Public Offering Price (1.989% of the net amount invested)
for the Short-Intermediate Trust. At the opening of business on the
Initial Date of Deposit, December 4, 1996, the Public Offering Price per
Unit would have been $10.2637 for the Short-Term Trust and $10.2321 for
the Short-Intermediate Trust. The sales charge for each Trust is reduced
on a graduated scale for aggregate sales involving at least $250,000.
See "How is the Public Offering Price Determined?", particularly for the
method of evaluation.
Each Unit represents an undivided interest in the principal and net
income of a Trust in the ratio of one Unit for each $10.00 principal
amount of Securities initially deposited in such Trust.
Distributions of interest received by a Trust will be paid in cash
monthly unless the Unit holder elects to have them automatically
reinvested as described herein. See "How Can Distributions to Unit
Holders be Reinvested?" Monthly distributions from each Trust will be
made on the last day of each month to all Unit holders of record on the
fifteenth day of such month, commencing with the First Distribution on
December 31, 1996 to Unit holders of record on December 15, 1996.
The Sponsor, although not obligated to do so, intends to maintain a
market for the Units of the Trusts at prices based upon the aggregate
offering price of the Securities in the portfolio of a Trust during the
initial offering period and at prices based upon the aggregate bid price
of the Securities in the portfolio of a Trust after the initial offering
period. In the absence of such a market, a Unit holder will nonetheless
be able to dispose of the Units through redemption at prices based upon
the bid prices of the underlying Securities. See "How May Units be
Redeemed?"
Risk Factors. An investment in a Trust should be made with an
understanding of the risks associated therewith, including, among other
factors, the volatility of interest rates. See "What is the First Trust
Special Situations Trust?-Risk Factors."
Page 2
Summary of Essential Information
At the Opening of Business on the Initial Date of Deposit
of the Securities-December 4, 1996
Sponsor: Nike Securities L.P.
Trustee: The Chase Manhattan Bank
Evaluator: Securities Evaluation Service, Inc.
<TABLE>
<CAPTION>
First Trust
U.S. Treasury
Securities Trust
Short-Term
Series 7
________________
<S> <C>
General Information
Principal Amount of Securities in the Trust $ 50,000
Number of Units 5,000
Fractional Undivided Interest in the Trust per Unit 1/5,000
Principal Amount (Par Value) of Securities per Unit $10.0000
Public Offering Price:
Aggregate Offering Price Evaluation of Securities in the Portfolio $ 50,369
Aggregate Offering Price Evaluation per Unit $10.0738
Sales Charge (1) $ .1899
Public Offering Price per Unit (2) $10.2637
Sponsor's Initial Repurchase Price per Unit (2) $10.0738
Redemption Price per Unit (3) $10.0692
Excess of Public Offering Price per Unit Over Redemption Price per Unit $ .1945
Excess of Sponsor's Initial Repurchase Price per Unit Over Redemption Price per Unit $ .0046
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
First Settlement Date December 9, 1996
Mandatory Termination Date July 31, 2000
Discretionary Liquidation Amount A Trust may be terminated if the principal amount thereof is less than the
lower of $1,000,000 or 10% of the total principal amount of Securities
deposited in a Trust during the primary offering period.
Supervisory Fee (4) Maximum of $.0010 per Unit outstanding annually. (5)
Evaluator's Fee $.0025 per Unit outstanding annually.
</TABLE>
Evaluations for purposes of sale, purchase or redemption of Units are
made as of the close of trading
(generally 4:00 p.m. Eastern time) on the New York Stock Exchange on
each day on which it is open.
[FN]
_________________
(1) Sales charges for the Trust, expressed as a percentage of the Public
Offering Price per Unit and in parenthesis as a percentage of the
Aggregate Offering Price Evaluation per Unit, are as follows: 1.85%
(1.885%) for Series 7.
(2) Anyone ordering Units for settlement after the First Settlement Date
will pay accrued interest from such date to the date of settlement
(normally three business days after order) less distributions from the
Interest Account subsequent to the First Settlement Date. For purchases
settling on the First Settlement Date, no accrued interest will be added
to the Public Offering Price. After the initial offering period, the
Sponsor's Repurchase Price per Unit, will be determined as described
under the caption "Will There Be a Secondary Market?"
(3) See "How May Units be Redeemed?"
(4) In addition, the Sponsor will be reimbursed for bookkeeping and other
administrative expenses currently at a maximum annual rate of $.0010 per Unit.
(5) Payable to an affiliate of the Sponsor.
Page 3
Summary of Essential Information
At the Opening of Business on the Initial Date of Deposit
of the Securities-December 4, 1996
Sponsor: Nike Securities L.P.
Trustee: The Chase Manhattan Bank
Evaluator: Securities Evaluation Service, Inc.
<TABLE>
<CAPTION>
First Trust
U.S. Treasury
Securities Trust
Short-Intermediate
Series 8
__________________
<S> <C>
General Information
Principal Amount of Securities in the Trust $ 50,000
Number of Units 5,000
Fractional Undivided Interest in the Trust per Unit 1/5,000
Principal Amount (Par Value) of Securities per Unit $ 10.0000
Public Offering Price:
Aggregate Offering Price Evaluation of Securities in the Portfolio $ 50,163
Aggregate Offering Price Evaluation per Unit $ 10.0326
Sales Charge (1) $ .1995
Public Offering Price per Unit (2) $ 10.2321
Sponsor's Initial Repurchase Price per Unit (2) $ 10.0326
Redemption Price per Unit (3) $ 10.0242
Excess of Public Offering Price per Unit Over Redemption Price per Unit $ .2079
Excess of Sponsor's Initial Repurchase Price per Unit Over Redemption Price per Unit $ .0084
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
First Settlement Date December 9, 1996
Mandatory Termination Date September 30, 2003
Discretionary Liquidation Amount A Trust may be terminated if the principal amount thereof is less than the
lower of $1,000,000 or 10% of the total principal amount of Securities
deposited in a Trust during the primary offering period.
Supervisory Fee (4) Maximum of $.0010 per Unit outstanding annually. (5)
Evaluator's Fee $.0025 per Unit outstanding annually.
</TABLE>
Evaluations for purposes of sale, purchase or redemption of Units are
made as of the close of trading
(generally 4:00 p.m. Eastern time) on the New York Stock Exchange on
each day on which it is open.
[FN]
________________
(1) Sales charges for the Trust, expressed as a percentage of the Public
Offering Price per Unit and in parenthesis as a percentage of the
Aggregate Offering Price Evaluation per Unit, are as follows: 1.95%
(1.989%) for Series 8.
(2) Anyone ordering Units for settlement after the First Settlement Date
will pay accrued interest from such date to the date of settlement
(normally three business days after order) less distributions from the
Interest Account subsequent to the First Settlement Date. For purchases
settling on the First Settlement Date, no accrued interest will be added
to the Public Offering Price. After the initial offering period, the
Sponsor's Repurchase Price per Unit, will be determined as described
under the caption "Will There Be a Secondary Market?"
(3) See "How May Units be Redeemed?"
(4) In addition, the Sponsor will be reimbursed for bookkeeping and other
administrative expenses currently at a maximum annual rate of $.0010 per Unit.
(5) Payable to an affiliate of the Sponsor.
Page 4
First Trust U.S. Treasury Securities Trust, Short-Term, Series 7
First Trust U.S. Treasury Securities Trust, Short-Intermediate, Series 8
The First Trust Special Situations Trust, Series 144
What is the First Trust Special Situations Trust?
The First Trust Special Situations Trust, Series 144 is one of a series
of investment companies created by the Sponsor under the name of The
First Trust Special Situations Trust, all of which are generally similar
but each of which is separate and is designated by a different series
number. This Series consists of the underlying separate unit investment
trusts designated as: First Trust U.S. Treasury Securities Trust, Short-
Term, Series 7 and First Trust U.S. Treasury Securities Trust, Short-
Intermediate, Series 8 (collectively, the "Trusts" and each individually
a "Trust"). First Trust U.S. Treasury Securities Trust, Short-Term,
Series 7 is individually referred to herein as the "Short-Term Trust."
First Trust U.S. Treasury Securities Trust, Short-Intermediate, Series 8
is individually referred to herein as the "Short-Intermediate Trust."
Each Trust was created under the laws of the State of New York pursuant
to a Trust Agreement (the "Indenture"), dated the Initial Date of
Deposit, with Nike Securities L.P., as Sponsor, The Chase Manhattan
Bank, as Trustee, Securities Evaluation Service, Inc., as Evaluator and
First Trust Advisors L.P., as Portfolio Supervisor. On the Initial Date
of Deposit, the Sponsor deposited with the Trustee taxable, interest-
bearing U.S. Treasury Obligations, delivery statements relating to
contracts for the purchase of certain such obligations and irrevocable
letters of credit issued by a financial institution in the amount
required for such purchases (the "Securities") in both the Short-Term
Trust and the Short-Intermediate Trust. The Trustee thereafter credited
to the account of the Sponsor documents evidencing the entire ownership
of each respective Trust at the Initial Date of Deposit.
The objective of each Trust is to obtain safety of capital and current
monthly distributions of interest through an investment in a fixed
portfolio of taxable U.S. Treasury Securities. Each Trust contains a
"laddered" portfolio to provide flexibility of principal investment with
maturities ranging from 1998 to 2000 with respect to the Short-Term
Trust and 1999 to 2003 with respect to the Short-Intermediate Trust.
Each Trust may be an appropriate medium for investors who desire to
participate in a portfolio of taxable fixed income securities offering
the safety of capital provided by securities backed by the full faith
and credit of the United States but who do not wish to invest the
minimum amount which is required for a direct investment in the
Securities. Because regular payments of principal are to be received in
accordance with the "laddered" maturities of the Securities and certain
Securities may be sold under circumstances described herein, and because
additional Securities may be deposited in the Trusts as described
herein, the Trusts are not expected to retain their present size and
composition. Units will remain outstanding until redeemed upon tender to
the Trustee by any Unit holder (which may include the Sponsor) or until
the termination of a Trust pursuant to the Indenture.
Many investors in the Short-Term Trust and the Short-Intermediate Trust
may benefit from the exemption of interest income from state and local
personal income taxes that will pass through the Trusts to Unit holders
in all states. Each Trust has the additional purpose of providing income
which is exempt from withholding for U.S. Federal income taxes for non-
resident alien investors providing certain conditions are met. A foreign
investor must provide a completed W-8 Form to his financial
representative or the Trustee to avoid withholding on his account.
In selecting the Securities for deposit in the Trusts, the following
factors, among others, were considered by the Sponsor: (i) the types of
such securities available; (ii) the prices and yields of such securities
relative to other comparable securities, including the extent to which
such securities are trading at a premium or at a discount from par;
(iii) whether the Securities were issued after July 18, 1984; and (iv)
the maturities of such securities. See "Portfolio" for each Trust for
information with respect to the Securities initially selected for
deposit in the Trusts.
The Portfolio of a Trust may contain Securities which were acquired at a
market discount. Such Securities trade at less than par value because
the interest coupons thereon are lower than interest coupons on
comparable debt securities being issued at currently prevailing interest
rates. If such interest rates for newly issued and otherwise comparable
Page 5
securities increase, the market discount of previously issued securities
will become greater, and if such interest rates for newly issued
comparable securities decline, the market discount of previously issued
securities will be reduced, other things being equal. Investors should
also note that the value of Securities purchased at a market discount
will increase in value faster than Securities purchased at a market
premium if interest rates decrease. Conversely, if interest rates
increase the value of Securities purchased at a market discount will
decrease faster than Securities purchased at a premium. Market discount
attributable to interest changes does not indicate a lack of market
confidence in the issue. Neither the Sponsor nor the Trustee shall be
liable in any way for any default, failure or defect in any of the
Securities.
The Portfolio of a Trust may contain U.S. Treasury Obligations which
have been stripped of their unmatured interest coupons. The zero coupon
Securities evidence the right to receive a fixed payment at a future
date from the U.S. Government, and are backed by the full faith and
credit of the U.S. Government. Zero coupon Securities are purchased at a
deep discount because the buyer obtains only the right to a fixed
payment at a fixed date in the future and does not receive any periodic
interest payments. The effect of owning deep discount bonds which do not
make current interest payments (such as the zero coupon Securities) is
that a fixed yield is earned not only on the original investment, but
also, in effect, on all earnings during the life of the discount
obligation. This implicit reinvestment of earnings at the same rate
eliminates the risk of being unable to reinvest the income on such
obligations at a rate as high as the implicit yield on the discount
obligation, but at the same time eliminates the holder's ability to
reinvest at higher rates in the future. For this reason, the zero coupon
Securities are subject to substantially greater price fluctuations
during periods of changing interest rates than are securities of
comparable quality which make regular interest payments.
The Portfolio of a Trust may contain Securities which were acquired at a
market premium. Such Securities trade at more than par value because the
interest coupons thereon are higher than interest coupons on comparable
debt securities being issued at currently prevailing interest rates. If
such interest rates for newly issued and otherwise comparable securities
decrease, the market premium of previously issued securities will be
increased, and if such interest rates for newly issued comparable
securities increase, the market premium of previously issued securities
will be reduced, other things being equal. The current returns of
securities trading at a market premium are initially higher than the
current returns of comparably rated debt securities of a similar type
issued at currently prevailing interest rates because premium securities
tend to decrease in market value as they approach maturity when the face
amount becomes payable. Market premium attributable to interest changes
does not indicate market confidence in the issue.
The contracts to purchase Securities delivered to the Trustee represent
an obligation by issuers or dealers to deliver Securities to the Sponsor
for deposit in a Trust. Contracts are typically settled and the
Securities delivered within a few business days subsequent to the
Initial Date of Deposit. The percentage of the aggregate principal
amount of the Securities, if any, relating to "when, as and if issued"
Securities or other Securities with delivery dates after the date of
settlement for a purchase made on the Initial Date of Deposit is
indicated in the Portfolio for a Trust. Interest on "when, as and if
issued" and delayed delivery Securities begins accruing to the benefit
of Unit holders on their dates of delivery. Because "when, as and if
issued" Securities have not yet been issued, as of the Initial Date of
Deposit a Trust is subject to the risk that the issuers thereof might
decide not to proceed with the offering of such Securities or that the
delivery of such Securities or the delayed delivery Securities may be
delayed. If such Securities, or replacement securities described below,
are not acquired by a Trust or if their delivery is delayed, the
Estimated Returns as set forth under "Special Information" may be reduced.
In the event of a failure to deliver any Securities that have been
purchased for a Trust under a contract ("Failed Securities"), the
Sponsor is authorized under the Indenture to direct the Trustee to
acquire other specified securities ("Replacement Securities") to make up
the original corpus of a Trust. The Replacement Securities must be
purchased within 20 days after delivery of the notice of the failed
contract and the purchase price (exclusive of accrued interest) may not
exceed the amount of funds reserved for the purchase of the Failed
Securities. The Replacement Securities (i) must satisfy the criteria
previously described for Securities originally included in a Trust, (ii)
Page 6
must maintain, as far as is practicable, the original percentage
relationship between the principal amounts of Securities of specified
interest rates and years of maturities in a Portfolio, and (iii) shall
not be "when, as and if issued" securities. Whenever Replacement
Securities have been acquired for a Trust, the Trustee shall, within
five days thereafter, notify all Unit holders of such Trust of the
acquisition of the Replacement Securities and shall, on the next monthly
distribution date which is more than 30 days thereafter, make a pro rata
distribution of the amount, if any, by which the cost to the affected
Trust of the Failed Securities exceeded the cost of the Replacement
Securities plus accrued interest. Except as provided below, once the
original corpus of a Trust is acquired, the Trustee will have no power
to vary the investment of a Trust, i.e., the Trustee will have no
managerial power to take advantage of market variations to improve a
Unit holder's investment.
If the right of limited substitution described in the preceding
paragraph shall not be utilized to acquire Replacement Securities in the
event of a failed contract, the Sponsor shall refund the principal and
accrued interest (at the coupon rate of the relevant Securities to the
date the Sponsor is notified of the failure) attributable to such failed
contract and the pro rata portion of the sales charge attributable to
such failed contract not more than thirty days after the determination
of such failure or at such earlier time as the Trustee in its sole
discretion deems to be in the interest of the Unit holders. Unit holders
should be aware that at the time of the receipt of such refunded
principal they may not be able to reinvest such principal in other
securities at a yield equal to or in excess of the yield which such
principal would have earned for Unit holders had the Failed Securities
been delivered to a Trust.
The Sponsor may, from time to time, deposit additional Securities in a
Trust (while additional Units are to be offered to the public)
maintaining, as closely as is practicable, the original percentage
relationship between the principal amounts of Securities of specified
interest rates and years of maturities in the Portfolio of such Trust.
With respect to each Trust, the Sponsor has the limited right to direct
the Trustee to purchase additional securities, which must satisfy the
criteria previously described for Securities originally included in each
Trust, with moneys held in the Principal Account of a Trust representing
the proceeds of Securities sold as described under the caption "How May
Securities be Removed from a Trust?" or the proceeds of Securities sold
which proceeds are not required for the purpose of redemption of Units.
Each Unit initially offered represents the fractional undivided interest
in a Trust set forth in the "Summary of Essential Information." To the
extent that any Units are redeemed by the Trustee, the fractional
undivided interest in a Trust represented by each unredeemed Unit will
increase, although the actual interest in such Trust represented by such
fraction will remain substantially unchanged. However, if additional
Units are issued by a Trust (in connection with the deposit by the
Sponsor of additional Securities), the aggregate value of Securities in
such Trust will be increased by amounts allocable to additional Units,
and the fractional undivided interest represented by each Unit in the
balance will be decreased. Units will remain outstanding until redeemed
upon tender to the Trustee by any Unit holder, which may include the
Sponsor, or until the termination of the Indenture.
Risk Factors
The Securities are direct obligations of the United States and are
backed by its full faith and credit although the Units of a Trust are
not so backed. The Securities are not rated but in the opinion of the
Sponsor have credit characteristics comparable to those of securities
rated "AAA" by nationally recognized rating agencies.
An investment in Units of a Trust should be made with an understanding
of the risks which an investment in fixed rate debt obligations may
entail, including the risk that the value of the Securities and hence
the Units will decline with increases in interest rates. The high
inflation of prior years, together with the fiscal measures adopted to
attempt to deal with it, have resulted in wide fluctuations in interest
rates and, thus, in the value of fixed rate debt obligations generally.
The Sponsor cannot predict whether such fluctuations will continue in
the future. U.S. Treasury Securities are not affected by credit risk but
are subject to changes in market value resulting from changes in
interest rates. Therefore, an investment in Units of the Trusts should
be made with an understanding of the risks which an investment in fixed-
rate short and intermediate term debt obligations may entail, including
the risk that the value of the Portfolio and hence of the Units will
decline with increases in interest rates.
Page 7
What is the Rating of the Units?
Standard & Poor's has rated the Units of each Trust "AAA." This is the
highest rating assigned by Standard & Poor's. See "Description of
Standard & Poor's Rating." The obtaining of this rating by a Trust
should not be construed as an approval of the offering of the Units by
Standard & Poor's or as a guarantee of the market value of a Trust or
the Units. Standard & Poor's has indicated that this rating is not a
recommendation to buy, hold or sell Units nor does it take into account
the extent to which expenses of a Trust or sales by a Trust of
Securities for less than the purchase price paid by a Trust will reduce
payment to Unit holders of the interest and principal required to be
paid on such Securities. There is no guarantee that the "AAA" investment
rating with respect to the Units will be maintained. Standard & Poor's
will be compensated by the Sponsor for its services in rating Units of a
Trust.
What are Estimated Returns?
Debt securities are customarily offered to investors on a "yield price"
basis (as contrasted to a "dollar price" basis) at the lesser of the
price as computed to maturity of such debt security or to an earlier
redemption date. Since Units of each Trust are offered on a dollar price
basis, the estimated rate of return on an investment in Units of a Trust
is stated in terms of "Estimated Current Return and Estimated Long-Term
Return."
At the opening of business on the Initial Date of Deposit, the Estimated
Current Return (if applicable) and the Estimated Long-Term Return for
each Trust are as set forth in the "Special Information" herein for each
Trust. Estimated Current Return is computed by dividing the Estimated
Net Annual Interest Income per Unit by the Public Offering Price per
Unit. The Estimated Net Annual Interest Income per Unit will vary with
changes in fees and expenses of the Trustee and the Evaluator and with
the principal prepayment, redemption, maturity, exchange or sale of
Securities while the Public Offering Price will vary with changes in the
offering price of the underlying Securities; therefore, there is no
assurance that the present Estimated Current Return will be realized in
the future. Estimated Current Return does not take into account timing
of distributions of income and other amounts (including delays in
distribution to Unit Holders), and it only partially reflects the
effects of premiums paid and discounts realized in the purchase price of
Units.
Unlike Estimated Current Return, Estimated Long-Term Return is a measure
of the estimated return to the investor earned over the estimated life
of a Trust. The Estimated Long-Term Return represents an average of the
yields to estimated retirements of the Securities in a Trust and
adjusted to reflect a compounding factor, expenses and sales charges.
Both Estimated Current Return (if applicable) and Estimated Long-Term
Return are subject to fluctuation with changes in the compositions of
the Portfolio of a Trust and changes in market value of the underlying
Securities and changes in fees and expenses, including sales charges,
and therefore can be materially different than the figures set forth in
"Special Information" herein for each Trust. In addition, return figures
may not be directly comparable to yield figures used to measure other
investments, and since return figures are based on certain assumptions
and variables, the actual returns received by a Unit holder may be
higher or lower.
In order to acquire certain of the Securities contracted for by the
Sponsor for deposit in a Trust, it may be necessary to pay on the
settlement dates for delivery of such Securities amounts covering
accrued interest on such Securities which exceed the amounts furnished
by the Sponsor. The Trustee has agreed to pay for any amounts necessary
to cover any such excess and will be reimbursed therefor, without
interest, when funds become available from interest payments on the
particular Securities with respect to which such payments have been made.
A comparison of estimated current returns and estimated long-term
returns with the returns on various investments is one element to
consider in making an investment decision. The Sponsor may from time to
time in its advertising and sales materials compare the then current
estimated returns on a Trust and returns over specified periods on other
similar Trusts sponsored by Nike Securities L.P. with returns on other
Page 8
taxable investments such as corporate bonds, bank CDs and money market
accounts or money market funds, each of which has investment
characteristics that may differ from those of the Trusts. Bank CDs and
money market accounts, for example, are insured by an agency of the
federal government. Money market accounts and money market funds provide
stability of principal, but pay interest at rates that vary with the
condition of the short-term debt market. The investment characteristics
of the Trusts are described more fully elsewhere in this Prospectus.
Record Dates for distributions of interest are the fifteenth day of each
month. The Distribution Dates for distributions of interest are the last
day of such month.
How is Accrued Interest Treated?
Accrued interest is the accumulation of unpaid interest on a security
from the last day on which interest thereon was paid. Interest on
Securities in a Trust generally is paid semi-annually, although the
Trust accrues such interest daily. Because of this, the Trust always has
an amount of interest earned but not yet collected by the Trustee. For
this reason, with respect to sales settling subsequent to the First
Settlement Date, the Public Offering Price of Units will have added to
it the proportionate share of accrued interest to the date of
settlement. Unit holders will receive on the next distribution date of a
Trust the amount, if any, of accrued interest paid on their Units.
In an effort to reduce the amount of accrued interest which would
otherwise have to be paid in addition to the Public Offering Price in
the sale of Units to the public, the Trustee will advance the amount of
accrued interest as of the First Settlement Date and the same will be
distributed to the Sponsor as the Unit holder of record as of the First
Settlement Date. Consequently, the amount of accrued interest to be
added to the Public Offering Price of Units will include only accrued
interest from the First Settlement Date to the date of settlement less
any distributions from the Interest Account subsequent to the First
Settlement Date. See "Rights of Unit Holders-How are Interest and
Principal Distributed?"
Because of the varying interest payment dates of the Securities, accrued
interest at any point in time will be greater than the amount of
interest actually received by a Trust and distributed to Unit holders.
Therefore, there will always remain an item of accrued interest that is
added to the value of the Units. If a Unit holder sells or redeems all
or a portion of his Units, he will be entitled to receive his
proportionate share of accrued interest from the purchaser of his Units.
Since the Trustee has the use of the funds held in the Interest Account
for distributions to Unit holders and since such Account is non-interest
bearing to Unit holders, the Trustee benefits thereby.
What are the Expenses and Charges?
At no cost to the Trusts, the Sponsor has borne all the expenses of
creating and establishing the Trusts, including the cost of the initial
preparation, printing and execution of the Indenture and the
certificates for the Units, legal and accounting expenses of the
Trustee. With the exception of bookkeeping and other administrative
services provided to the Trusts, for which the Sponsor will be
reimbursed in amounts as set forth under "Summary of Essential
Information," the Sponsor will not receive any fees in connection with
its activities relating to the Trusts. Such bookkeeping and
administrative charges may be increased without approval of the Unit
holders by amounts not exceeding proportionate increases under the
category "All Services Less Rent of Shelter" in the Consumer Price Index
published by the United States Department of Labor. The fees payable to
the Sponsor for such services may exceed the actual costs of providing
such services for these Trusts, but at no time will the total amount
received for such services rendered to all unit investment trusts of
which Nike Securities L.P. is the Sponsor in any calendar year exceed
the aggregate cost to the Sponsor of supplying such services in such
year. First Trust Advisors L.P., an affiliate of the Sponsor, will
receive an annual supervisory fee, which is not to exceed the amount set
forth under "Summary of Essential Information," for providing portfolio
supervisory services for each Trust. The fee may exceed the actual costs
of providing such supervisory services for these Trusts, but at no time
will the total amount received for portfolio supervisory services
rendered to all unit investment trusts of which Nike Securities L.P. is
the Sponsor in any calendar year exceed the aggregate cost to First
Trust Advisors L.P. of supplying such services in such year. In
providing such supervisory services, the Portfolio Supervisor may
purchase research services from a variety of sources which may include
underwriters or dealers of the Trusts.
For purposes of evaluation of the Securities in a Trust, the Evaluator
will receive a fee as indicated in "Summary of Essential Information."
The Trustee pays certain expenses of the Trusts for which it is
reimbursed by each Trust. The Trustee will receive for its ordinary
recurring services to each Trust an annual fee as indicated in "Special
Page 9
Information." For a discussion of the services performed by the Trustee
pursuant to its obligations under the Indenture, reference is made to
the material set forth under "Rights of Unit Holders." The Trustee's and
Evaluator's fees are payable monthly on or before each Distribution Date
from the Interest Account to the extent funds are available and then
from the Principal Account. Since the Trustee has the use of the funds
being held in the Principal and Interest Accounts for future
distributions, payment of expenses and redemptions and since such
Accounts are non-interest bearing to Unit holders, the Trustee benefits
thereby. Part of the Trustee's compensation for its services to a Trust
is expected to result from the use of these funds. Both fees may be
increased without approval of the Unit holders by amounts not exceeding
proportionate increases under the category "All Services Less Rent of
Shelter" in the Consumer Price Index published by the United States
Department of Labor.
The following additional charges are or may be incurred by a Trust: all
legal expenses of the Trustee incurred by or in connection with its
responsibilities under the Indenture; the expenses and costs of any
action undertaken by the Trustee to protect such Trust and the rights
and interests of the Unit holders; fees of the Trustee for any
extraordinary services performed under the Indenture; indemnification of
the Trustee for any loss, liability or expense incurred by it without
negligence, bad faith or willful misconduct on its part, arising out of
or in connection with its acceptance or administration of such Trust;
indemnification of the Sponsor for any loss, liability or expense
incurred without gross negligence, bad faith or willful misconduct in
acting as Depositor of such Trust; all taxes and other government
charges imposed upon the Securities or any part of such Trust (no such
taxes or charges are being levied or made or, to the knowledge of the
Sponsor, contemplated). The above expenses and the Trustee's annual fee,
when paid or owing to the Trustee, are secured by a lien on a Trust. In
addition, the Trustee is empowered to sell Securities in a Trust in
order to make funds available to pay all these amounts if funds are not
otherwise available in the Interest and Principal Accounts of such
Trust. Due to the minimum principal amount in which Securities may be
required to be sold, the proceeds of such sales may exceed the amount
necessary for the payment of such fees and expenses.
Unless the Sponsor determines that such an audit is not required, the
Indenture requires the accounts of a Trust shall be audited on an annual
basis at the expense of such Trust by independent auditors selected by
the Sponsor. So long as the Sponsor is making a secondary market for
Units, the Sponsor shall bear the cost of such annual audits to the
extent such cost exceeds $0.50 per 100 Units. Unit holders of a Trust
covered by an audit may obtain a copy of the audited financial
statements from the Trustee upon request.
What is the Tax Status of Unit Holders?
In the opinion of Chapman and Cutler, counsel for the Sponsor, under
existing law:
1. Each Trust is not an association taxable as a corporation for
Federal income tax purposes; each Unit holder will be treated as the
owner of a pro rata portion of such Trust under the Internal Revenue
Code (the "Code") and income of such Trust will be treated as the income
of the Unit holders under the Code. Each Unit holder will be considered
to have received his or her pro rata share of income derived from each
Trust asset when such income is received by a Trust.
2. Each Unit holder will have a taxable event when each Trust disposes
of a Security, or when the Unit holder redeems or sells his Units. Unit
holders must reduce the tax basis of their Units for their share of
accrued interest received by a Trust, if any, on Securities delivered
after the Unit holders pay for their Units to the extent that such
interest accrued on such Securities before the date the Trust acquired
ownership of the Securities (and the amount of this reduction may exceed
the amount of accrued interest paid to the seller) and, consequently,
such Unit holders may have an increase in taxable gain or reduction in
capital loss upon the disposition of such Units. Gain or loss upon the
sale or redemption of Units is measured by comparing the proceeds of
such sale or redemption with the adjusted basis of the Units. If the
Trustee disposes of Securities (whether by sale, payment on maturity,
redemption or otherwise), gain or loss is recognized to the Unit holder.
The amount of such gain or loss is measured by comparing the Unit
Page 10
holder's pro rata share of the total proceeds from such disposition with
the Unit holder's basis for his or her fractional interest in the asset
disposed of. In the case of a Unit holder who purchases Units, such
basis (before adjustment for earned original issue discount, amortized
bond premium and accrued market discount (if the Unit holder has elected
to include such market discount in income as it accrues), if any) is
determined by apportioning the cost of the Units among each of a Trust's
assets ratably according to value as of the date of acquisition of the
Units. The tax basis reduction requirements of the Code relating to
amortization of bond premium may, under some circumstances, result in
the Unit holder realizing a taxable gain when his Units are sold or
redeemed for an amount equal to or less than his original cost.
3. The basis of each Unit and of each Security which was issued with
original issue discount must be increased by the amount of accrued
original issue discount and the basis of each Unit and of each Security
which was purchased by a Trust at a premium must be reduced by the
annual amortization of bond premium which the Unit holder has properly
elected to amortize under Section 171 of the Code. Each Trust may
contain certain "zero coupon" Securities (the "Stripped Treasury
Securities") that are treated as bonds that were originally issued at an
original issue discount provided, pursuant to a Treasury Regulation (the
"Regulation") issued on December 28, 1992, that the amount of original
issue discount determined under Section 1286 of the Code is not less
than a "de minimis" amount as determined thereunder. Because the
Stripped Treasury Securities represent interests in "stripped" U.S.
Treasury bonds, a Unit holder's initial cost for his pro rata portion of
each Stripped Treasury Security held by a Trust (determined at the time
he acquires his Units, in the manner described above) shall be treated
as its "purchase price" by the Unit holder. Original issue discount is
effectively treated as interest for Federal income tax purposes, and the
amount of original issue discount in this case is generally the
difference between the bond's purchase price and its stated redemption
price at maturity. A Unit holder will be required to include in gross
income for each taxable year the sum of his daily portions of original
issue discount attributable to the Stripped Treasury Securities held by
a Trust as such original issue discount accrues and will, in general, be
subject to Federal income tax with respect to the total amount of such
original issue discount that accrues for such year even though the
income is not distributed to the Unit holders during such year to the
extent it is not less than a "de minimis" amount as determined under the
Regulation. To the extent that the amount of such discount is less than
the respective "de minimis" amount, such discount shall be treated as
zero. In general, original issue discount accrues daily under a constant
interest rate method which takes into account the semi-annual
compounding of accrued interest. In the case of the Stripped Treasury
Securities, this method will generally result in an increasing amount of
income to the Unit holders each year. Unit holders should consult their
tax advisers regarding the Federal income tax consequences and accretion
of original issue discount.
4. The Unit holder's aliquot share of the total proceeds received on
the disposition of, or principal paid with respect to, a Security held
by a Trust will constitute ordinary income (which will be treated as
interest income for most purposes) to the extent it does not exceed the
accrued market discount on such Security that has not previously been
included in taxable income by such Unit holder. A Unit holder may
generally elect to include market discount in income as such discount
accrues. In general, market discount is the excess, if any, of the Unit
holder's pro rata portion of the outstanding principal balance of a
Security over the Unit holder's initial tax basis for such pro rata
portion, determined at the time such Unit holder acquires his Units.
However, market discount with respect to any Security will generally be
considered zero if it amounts to less than 0.25% of the obligation's
stated redemption price at maturity times the number of years to
maturity. The market discount rules do not apply to Stripped Treasury
Page 11
Securities because they are stripped debt instruments subject to special
original issue discount rules as discussed above. If a Unit holder sells
his Units, gain, if any, will constitute ordinary income to the extent
of the aggregate of the accrued market discount on the Unit holder's pro
rata portion of each Security that is held by a Trust that has not
previously been included in taxable income by such Unit holder. In
general, market discount accrues on a ratable basis unless the Unit
holder elects to accrue such discount on a constant interest rate basis.
However, a Unit holder should consult his own tax adviser regarding the
accrual of market discount. The deduction by a Unit holder for any
interest expense incurred to purchase or carry Units will be reduced by
the amount of any accrued market discount that has not yet been included
in taxable income by such Unit holder. In general, the portion of any
interest expense which is not currently deductible would be ultimately
deductible when the accrued market discount is included in income.
5. The Code provides that "miscellaneous itemized deductions" are
allowable only to the extent that they exceed two percent of an
individual taxpayer's adjusted gross income. Miscellaneous itemized
deductions subject to this limitation under present law include a Unit
holder's pro rata share of expenses paid by the applicable Trust,
including fees of the Trustee and the Evaluator but does not include
amortizable bond premium on Securities held by the Short-Intermediate
Trust.
"The Revenue Reconciliation Act of 1993" (the "Tax Act") raised tax
rates on ordinary income while capital gains remain subject to a 28%
maximum stated rate for taxpayers other than corporations. Because some
or all capital gains are taxed at a comparatively lower rate under the
Tax Act, the Tax Act includes a provision that recharacterizes capital
gains as ordinary income in the case of certain financial transactions
that are "conversion transactions" effective for transactions entered
into after April 30, 1993. Unit holders and prospective investors should
consult with their tax advisers regarding the potential effect of this
provision on their investment in Units.
A Unit holder of a Trust who is not a citizen or resident of the United
States or a United States domestic corporation (a "Foreign Investor")
will not be subject to U.S. Federal income taxes, including withholding
taxes on amounts distributed from a Trust (including any original issue
discount) on, or any gain from the sale or other disposition of, his
Units or the sale or disposition of any Securities by the Trustee,
provided that (i) the interest income or gain is not effectively
connected with the conduct by the Foreign Investor of a trade or
business within the United States, (ii) with respect to any gain, the
Foreign Investor (if an individual) is not present in the United States
for 183 days or more during the taxable year, and (iii) the Foreign
Investor provides the required certification of his status and of the
matters contained in clauses (i) and (ii) above, and further provided
that the exemption from withholding for U.S. Federal income taxes for
interest on any U.S. Securities shall only apply to the extent the
Securities were issued after July 18, 1984.
Unless an applicable treaty exemption applies and proper certification
is made, amounts otherwise distributable by a Trust to a Foreign
Investor will generally be subject to withholding taxes under Section
1441 of the Code unless the Unit holder timely provides his financial
representative or the Trustee with a statement that (i) is signed by the
Unit holder under penalties of perjury, (ii) certifies that such Unit
holder is not a United States person, or in the case of an individual,
that he is neither a citizen nor a resident of the United States, and
(iii) provides the name and address of the Unit holder. The statement
may be made, at the option of the person otherwise required to withhold,
on Form W-8 or on a substitute form that is substantially similar to
Form W-8. If the information provided on the statement changes, the
beneficial owner must so inform the person otherwise required to
withhold within 30 days of such change.
Each Unit holder (other than a foreign investor who has properly
provided the certifications described in the preceding paragraph) will
be requested to provide the Unit holder's taxpayer identification number
to the Trustee and to certify that the Unit holder has not been notified
that payments to the Unit holder are subject to back-up withholding. If
the proper taxpayer identification number and appropriate certification
are not provided when requested, distributions by a Trust to such Unit
holder will be subject to back-up withholding.
Investment in a Trust may be particularly well suited for purchase by
funds and accounts of individual investors that are exempt from Federal
income taxes such as Individual Retirement Accounts, Keogh Plans,
pension funds and other tax-deferred retirement plans (see "Why are
Investments in a Trust Suitable for Retirement Plans?").
The foregoing discussions relate only to Federal income taxes on
distributions by a Trust. Foreign holders should consult their own tax
advisers with respect to the foreign and United States Federal income
tax consequences of ownership of Units.
The Sponsor believes that Unit holders who are individuals will not be
subject to any state personal income taxes on the interest received by a
Trust and distributed to them. However, Unit holders (including
individuals) may be subject to state and local taxes on any capital
gains (or market discount treated as ordinary income) derived from a
Trust and to other state and local taxes (including corporate income or
Page 12
franchise taxes, personal property or intangible taxes, and estate or
inheritance taxes) on their Units or the income derived therefrom. In
addition, individual Unit holders (and any other Unit holders which are
not subject to state and local taxes on the interest income derived from
a Trust) will probably not be entitled to a deduction for state and
local tax purposes for their share of the fees and expenses paid by a
Trust, for any amortized bond premium or for any interest on
indebtedness incurred to purchase or carry their Units. Therefore, even
though the Sponsor believes that interest income from a Trust is exempt
from state personal income taxes in all states, Unit holders should
consult their own tax advisers with respect to state and local taxation
of the purchase, ownership and disposition of Units.
It should be remembered that even if distributions are reinvested
through the Distribution Reinvestment Option they are still treated as
distributions for income tax purposes (see "How Can Distributions to
Unit Holders be Reinvested?").
It should also be remembered that Unit holders may be required for
Federal income tax purposes to include amounts in ordinary gross income
in advance of the receipt of the cash attributable to such income.
The market discount rules do not apply to stripped Treasury Securities
because they are stripped debt instruments subject to special original
issue discount rules. Unit holders should consult their tax advisers as
to the amount of original issue discount which accrues.
If a Unit holder does not elect to annually include accrued market
discount in taxable income as it accrues, deduction for any interest
expense incurred by the Unit holder which is incurred to purchase or
carry his Units will be reduced by such accrued market discount. In
general, the portion of any interest expense which was not currently
deductible would ultimately be deductible when the accrued market
discount is included in income. Unit holders should consult their tax
advisers regarding whether an election should be made to include market
discount in income as it accrues and as to the amount of interest
expense which may not be currently deductible.
The tax basis of a Unit holder with respect to his interest in a
Security is increased by the amount of original issue discount (and
market discount, if the Unit holder elects to include market discount,
if any, on the Securities held by a Trust in income as it accrues)
thereon properly included in the Unit holder's gross income as
determined for Federal income tax purposes and reduced by the amount of
any amortized acquisition premium which the Unit holder has properly
elected to amortize under Section 171 of the Code. A Unit holder's tax
basis in his Units will equal his tax basis in his pro rata portion of
all of the assets of the Trust.
A Unit holder will recognize taxable capital gain (or loss) when all or
part of his pro rata interest in a Security is disposed of in a taxable
transaction for an amount greater (or less) than his tax basis therefor.
Any gain recognized on a sale or exchange and not constituting a
realization of accrued "market discount," and any loss will, under
current law, generally be capital gain or loss except in the case of a
dealer or financial institution. As previously discussed, gain realized
on the disposition of the interest of a Unit holder in any Security
deemed to have been acquired with market discount will be treated as
ordinary income to the extent the gain does not exceed the amount of
accrued market discount not previously taken into income. Any capital
gain or loss arising from the disposition of a Security by the Trust or
the disposition of Units by a Unit holder will be short-term capital
gain or loss unless the Unit holder has held his Units for more than one
year in which case such capital gain or loss will be long term. The tax
basis reduction requirements of the Code relating to amortization of
bond premium may, under some circumstances, result in the Unit holder
realizing taxable gain when his Units are sold or redeemed for an amount
equal to or less than his original cost.
If the Unit holder disposes of a Unit, he is deemed thereby to have
disposed of his entire pro rata interest in all Trust assets including
his pro rata portion of the Securities represented by the Unit. This may
result in a portion of the gain, if any, on such sale being taxable as
ordinary income under the market discount rules (assuming no election
was made by the Unit holder to include market discount in income as it
accrues) as previously discussed.
Why are Investments in a Trust Suitable for Retirement Plans?
A Trust may be well suited for purchase by Individual Retirement
Accounts, Keogh Plans, pension funds and other tax-deferred retirement
plans. Generally, the Federal income tax relating to capital gains and
income received in each of the foregoing plans is deferred until
Page 13
distributions are received. Distributions from such plans are generally
treated as ordinary income but may, in some cases, be eligible for
special averaging or tax-deferred rollover treatment. Investors
considering participation in any such plan should review specific tax
laws related thereto and should consult their attorneys or tax advisers
with respect to the establishment and maintenance of any such plan. Such
plans are offered by brokerage firms and other financial institutions.
Each Trust will waive the $1,000 minimum investment requirement for tax-
deferred retirement plan accounts. The minimum investment is $250 for
tax-deferred retirement plans such as IRA accounts. Fees and charges
with respect to such plans may vary.
How Can Distributions to Unit Holders be Reinvested?
Universal Distribution Option. Unit holders may elect participation in a
Universal Distribution Option which permits a Unit holder to direct the
Trustee to distribute principal and interest payments to any other
investment vehicle of which the Unit holder has an existing account. For
example, at a Unit holder's direction, the Trustee would distribute
automatically on the applicable distribution date interest income or
principal on the participant's Units to, among other investment
vehicles, a Unit holder's checking, bank savings, money market,
insurance, reinvestment or any other account. All such distributions, of
course, are subject to the minimum investment and sales charges, if any,
of the particular investment vehicle to which distributions are
directed. The Trustee will notify the participant of each distribution
pursuant to the Universal Distribution Option. The Trustee will
distribute directly to the Unit holder any distributions which are not
accepted by the specified investment vehicle. A participant may at any
time, by so notifying the Trustee in writing, elect to terminate his
participation in the Universal Distribution Option and directly receive
future distributions on his Units.
PUBLIC OFFERING
How is the Public Offering Price Determined?
Units are offered at the Public Offering Price. During the initial
offering period, the Public Offering Price is determined by adding to
the Evaluator's determination of the aggregate offering price of the
Securities in a Trust, including any money in the Principal Account
other than money required to redeem tendered Units, a sales charge of
1.85% of the Public Offering Price (which is equivalent to 1.885% of the
net amount invested) for the Short-Term Trust and 1.95% of the Public
Offering Price (which is equivalent to 1.989% of the net amount
invested) for the Short-Intermediate Trust. During the initial offering
period, the Sponsor's Repurchase Price is equal to the Evaluator's
determination of the aggregate offering price of the Securities in a
Trust. For secondary market sales after the completion of the initial
offering period, the Public Offering Price is based on the Evaluator's
determination of the aggregate bid price of the Securities in a Trust,
including any money in the Principal Account other than money required
to redeem tendered Units, and also includes a sales charge of 1.85% of
the Public Offering Price (which is equivalent to 1.885% of the net
amount invested) for the Short-Term Trust and 1.95% of the Public
Offering Price (which is equivalent to 1.989% of the net amount
invested) for the Short-Intermediate Trust. Also added to the Public
Offering Price is a proportionate share of interest accrued but unpaid
on the Securities after the First Settlement Date to the date of
settlement of Units (see "How is Accrued Interest Treated?").
The applicable sales charge for each Trust during the initial offering
period is reduced by a discount as indicated below for volume purchases
(except for sales made pursuant to a "wrap fee account" or similar
arrangements as set forth below):
Dollar Amount
of Transaction Discount Expressed
at Public Percentage of
Offering Price Public Offering Price
______________ _____________________
$ 250,000 to 499,999 .05%
$ 500,000 to 999,999 .10%
$1,000,000 or more .25%
Any such reduced sales charge shall be the responsibility of the selling
broker/dealer, bank or other selling agent. This reduced
Page 14
sales charge structure will apply on all purchases of Units in either
Trust by the same person on any one day from any one dealer. For
purposes of calculating the applicable sales charge, purchases of Units
in the Trusts will be aggregated together but will not be aggregated
with any other purchases by the same person of units in any series of
tax-exempt or other unit investment trusts sponsored by Nike Securities
L.P. Additionally, Units purchased in the name of the spouse of a
purchaser or in the name of a child of such purchaser under 21 years of
age will be deemed for the purposes of calculating the applicable sales
charge to be additional purchases by the purchaser. The reduced sales
charges will also be applicable to a trustee or other fiduciary
purchasing securities for a single trust or single fiduciary account.
The purchaser must inform the dealer of any such combined purchase prior
to the sale in order to obtain the indicated discount. With respect to
employees, officers and directors (including their immediate family
members, defined as spouses, children, grandchildren, parents,
grandparents, siblings, mothers-in-law, fathers-in-law, sons-in-law,
daughters-in-law, and trustees, custodians or fiduciaries for the
benefit of such persons) of the Sponsor, dealers and their affiliates
will be able to purchase Units at the Public Offering Price less the
applicable dealer concession.
Investors who purchase Units through registered broker/dealers who
charge periodic fees for financial planning, investment advisory or
asset management services or provide such services in connection with
the establishment of an investment account for which a comprehensive
"wrap fee" charge is imposed may purchase Units in the primary or
secondary market at the Public Offering Price less the concession the
Sponsor typically would allow such broker/dealer. See "Public Offering-
How are Units Distributed?"
On the Initial Date of Deposit, the Public Offering Price per Unit with
respect to each Trust is as indicated in the "Summary of Essential
Information" for each Trust. In addition to fluctuations in the amount
of interest accrued but unpaid on Securities in a Trust, the Public
Offering Price at any time during the initial offering period will vary
from the Public Offering Price stated herein in accordance with
fluctuations in the prices of the underlying Securities.
The aggregate price of the Securities in a Trust is determined by
Securities Evaluation Service, Inc. acting as evaluator (the
"Evaluator") on the basis of offering prices or bid prices as is
appropriate, (1) on the basis of current market prices for the
Securities obtained from dealers or brokers who customarily deal in
Securities comparable to those held by a Trust; (2) if such prices are
not available for any of the Securities, on the basis of current market
prices for comparable securities; (3) by determining the value of the
Securities by appraisal; or (4) by any combination of the above.
During the initial public offering period, a determination of the
aggregate price of the Securities in a Trust is made by the Evaluator on
an offering price basis, as of the close of trading on the New York
Stock Exchange (generally 4:00 p.m. Eastern time or as of any earlier
closing time on a day on which the New York Stock Exchange is scheduled
in advance to close at such earlier time) on each day on which it is
open, effective for all sales made subsequent to the last preceding
determination. For secondary market purposes, the Evaluator will be
requested to make such a determination, on a bid price basis, as of the
close of trading on the New York Stock Exchange on each day on which it
is open, effective for all sales, purchases or redemptions made
subsequent to the last preceding determination.
The Public Offering Price of the Units during the initial offering
period is equal to the offering price per Unit of the Securities in a
Trust plus the applicable sales charge. After the completion of the
initial offering period, the secondary market Public Offering Price will
be equal to the bid price per Unit of the Securities in a Trust plus the
applicable sales charge. The offering price of Securities in a Trust was
greater than the bid price of such Securities on the Initial Date of
Deposit by the aggregate amount and the amount per Unit indicated in
"Portfolio" for each Trust.
Although payment is normally made three business days following the
order for purchase, payment may be made prior thereto. A person will
become owner of the Units on the date of settlement provided payment has
been received. Cash, if any, made available to the Sponsor prior to the
date of settlement for the purchase of Units may be used in the
Sponsor's business and may be deemed to be a benefit to the Sponsor,
subject to the limitations of the Securities Exchange Act of 1934.
Delivery of Certificates representing Units so ordered will be made
three business days following such order or shortly thereafter. Initial
transaction statements for Units held in uncertificated form
representing Units so ordered will be issued to the registered owner of
such Units within two business days of the issuance of such Units. See
Page 15
"Rights of Unit Holders-How May Units be Redeemed?" for information
regarding the ability to redeem Units ordered for purchase.
How are Units Distributed?
During the initial offering period (i) for Units issued on the Initial
Date of Deposit and (ii) for additional Units issued after such date as
additional Securities are deposited by the Sponsor, Units will be
distributed to the public at the then current Public Offering Price. The
initial offering period may be up to approximately 360 days. During such
period, the Sponsor may deposit additional Securities in a Trust and
create additional Units. Units reacquired by the Sponsor during the
initial offering period (at prices based upon the aggregate underlying
value of the Securities in a Trust plus or minus a pro rata share of
cash, if any, in the Income and Capital Accounts of such Trust) may be
resold at the then current Public Offering Price. Upon the termination
of the initial offering period, unsold Units created or reacquired
during the initial offering period will be sold or resold at the then
current Public Offering Price.
Upon completion of the initial offering, Units repurchased in the
secondary market (see "Will There be a Secondary Market?") may be
offered by this prospectus at the secondary market public offering price
determined in the manner described above.
It is the intention of the Sponsor to qualify Units of a Trust for sale
in a number of states. Sales initially will be made to dealers and
others at prices which represent a concession or agency commission of
1.1% of the Public Offering Price for the Short-Term Trust and 1.2% of
the Public Offering Price for the Short-Intermediate Trust, but the
Sponsor reserves the right to change the amount of the concession to
dealers and others from time to time. Certain commercial banks may be
making Units of a Trust available to their customers on an agency basis.
A portion of the sales charge paid by these customers is retained by or
remitted to the banks in the amounts as indicated above. Under the Glass-
Steagall Act, banks are prohibited from underwriting Trust Units;
however, the Glass-Steagall Act does permit certain agency transactions
and the banking regulators have not indicated that these particular
agency transactions are not permitted under such Act. In Texas and in
certain other states, any banks making Units available must be
registered as broker/dealers under state law.
From time to time the Sponsor may implement programs under which
broker/dealers or other selling agents of a Trust may receive nominal
awards from the Sponsor for each of their registered representatives who
have sold a minimum number of UIT Units during a specified time period.
In addition, at various times the Sponsor may implement other programs
under which the sales force of a broker/dealer or other selling agents
may be eligible to win other nominal awards for certain sales efforts,
or under which the Sponsor will reallow to any such broker/dealer or
other selling agents that sponsors sales contests or recognition
programs conforming to criteria established by the Sponsor, or
participates in sales programs sponsored by the Sponsor, an amount not
exceeding the total applicable sales charges on the sales generated by
such person at the public offering price during such programs. Also, the
Sponsor in its discretion may from time to time pursuant to objective
criteria established by the Sponsor pay fees to qualifying
broker/dealers or other selling agents for certain services or
activities which are primarily intended to result in sales of Units of a
Trust. Such payments are made by the Sponsor out of its own assets, and
not out of the assets of a Trust. These programs will not change the
price Unit holders pay for their Units or the amount that a Trust will
receive from the Units sold.
What are the Profits of the Sponsor?
The Sponsor will receive a gross sales commission equal to 1.85% of the
Public Offering Price (equivalent to 1.885% of the net amount invested)
for the Short-Term Trust and 1.95% of the Public Offering Price
(equivalent to 1.989% of the net amount invested) for the Short-
Intermediate Trust, less any reduced sales charge for volume purchases
as described under "Public Offering-How is the Public Offering Price
Determined?" In addition, the Sponsor may be considered to have realized
a profit or the Sponsor may be considered to have sustained a loss, as
the case may be for each Trust, in the amount of any difference between
the cost of the Securities to such Trust and the cost of such Securities
to the Sponsor. See "Portfolio" for each Trust under the heading "Profit
or (Loss) to Sponsor" for the Sponsor's profit or loss on the Initial
Date of Deposit.
Page 16
In maintaining a market for the Units, the Sponsor will also realize
profits or sustain losses in the amount of any difference between the
price at which Units are purchased (based on the bid of the Securities
in a Trust) and the price at which Units are resold (which price is also
based on the bid prices of the Securities in such Trust and includes a
sales charge of 1.85% for the Short-Term Trust and 1.95% for the Short-
Intermediate Trust) or redeemed. The secondary market public offering
price of Units may be greater or less than the cost of such Units to the
Sponsor.
Will There be a Secondary Market?
After the initial offering period, although it is not obligated to do
so, the Sponsor intends to maintain a market for the Units and
continuously to offer to purchase Units at prices, subject to change at
any time, based upon the aggregate bid price of the Securities in the
portfolio of a Trust plus interest accrued to the date of settlement. To
the extent that a secondary market is maintained during the initial
offering period with respect to the Trusts, the prices at which Units of
a Trust will be repurchased will be based upon the aggregate offering
side evaluation of the Securities in the portfolio of a Trust. The
aggregate bid prices of the underlying Securities in each Trust, upon
which the Sponsor's Repurchase Price and the Redemption Price are based,
are expected to be less than the related aggregate offering prices
(which is the evaluation method used during the initial public offering
period). All expenses incurred in maintaining a secondary market, other
than the fees of the Evaluator and the costs of the Trustee in
transferring and recording the ownership of Units, will be borne by the
Sponsor. If the supply of Units exceeds demand, or for some other
business reason, the Sponsor may discontinue purchases of Units at such
prices. IF A UNIT HOLDER WISHES TO DISPOSE OF HIS UNITS, HE SHOULD
INQUIRE OF THE SPONSOR AS TO CURRENT MARKET PRICES PRIOR TO MAKING A
TENDER FOR REDEMPTION TO THE TRUSTEE.
RIGHTS OF UNIT HOLDERS
How is Evidence of Ownership Issued and Transferred?
The Trustee is authorized to treat as the record owner of Units that
person who is registered as such owner on the books of the Trustee.
Ownership of Units may be evidenced by registered certificates executed
by the Trustee and the Sponsor. Delivery of certificates representing
Units ordered for purchase is normally made three business days
following such order or shortly thereafter. Certificates are
transferable by presentation and surrender to the Trustee properly
endorsed or accompanied by a written instrument or instruments of
transfer. Certificates to be redeemed must be properly endorsed or
accompanied by a written instrument or instruments of transfer. A Unit
holder must sign exactly as his name appears on the face of the
certificate with the signature guaranteed by a participant in the
Securities Transfer Agents Medallion Program ("STAMP") or such other
signature guaranty program in addition to, or in substitution for,
STAMP, as may be accepted by the Trustee. In certain instances the
Trustee may require additional documents such as, but not limited to,
trust instruments, certificates of death, appointments as executor or
administrator or certificates of corporate authority. Record ownership
may occur before settlement.
Certificates will be issued in fully registered form, transferable only
on the books of the Trustee in denominations of one Unit or any multiple
thereof, numbered serially for purposes of identification.
Unit holders may elect to hold their Units in uncertificated form. The
Trustee will maintain an account for each such Unit holder and will
credit each such account with the number of Units purchased by that Unit
holder. Within two business days of the issuance or transfer of Units
held in uncertificated form, the Trustee will send to the registered
owner of Units a written initial transaction statement containing a
description of the Trust; the number of Units issued or transferred; the
name, address and taxpayer identification number, if any, of the new
registered owner; a notation of any liens and restrictions of the issues
and any adverse claims to which such Units are or may be subject or a
statement that there are no such liens, restrictions or adverse claims;
and the date the transfer was registered. Uncertificated Units are
transferable through the same procedures applicable to Units evidenced
by certificates (described above), except that no certificate need be
presented to the Trustee and no certificate will be issued upon transfer
unless requested by the Unit holder. A Unit holder may at any time
request the Trustee to issue certificates for Units.
Although no such charge is now made or contemplated, a Unit holder may
be required to pay $2.00 to the Trustee per certificate reissued or
Page 17
transferred, and to pay any governmental charge that may be imposed in
connection with each such transfer or exchange. For new certificates
issued to replace destroyed, stolen or lost certificates, the Unit
holder may be required to furnish indemnity satisfactory to the Trustee
and pay such expenses as the Trustee may incur. Mutilated certificates
must be surrendered to the Trustee for replacement.
How are Interest and Principal Distributed?
The pro rata share of cash in the Principal Account will be computed as
of the fifteenth day of each month and distributions to the Unit holders
as of such Record Date will be made on the last day of such month.
Proceeds from the disposition of any of the Securities or amounts
representing principal on the Securities received after such Record Date
and prior to the following Distribution Date will be held in the
Principal Account and not distributed until the next Distribution Date.
The Trustee is not required to pay interest on funds held in the
Principal or Interest Account (but may itself earn interest thereon and
therefore benefits from the use of such funds) nor make a distribution
from the Principal Account unless the amount available for distribution
shall equal at least $1.00 per 100 Units.
The Trustee will credit to the Interest Account all interest received by
a Trust, including moneys representing penalties for the failure to make
timely payments on Securities or liquidated damages for default or
breach of any condition or term of the Securities and that part of the
proceeds of any disposition of Securities which represents accrued
interest. Other receipts will be credited to the Principal Account.
Persons who purchase Units between a Record Date and a Distribution Date
will receive their first distribution on the second Distribution Date
after the purchase.
As of the fifteenth day of each month, the Trustee will deduct from the
Interest Account and, to the extent funds are not sufficient therein,
from the Principal Account, amounts necessary to pay the expenses of a
Trust. The Trustee also may withdraw from said accounts such amounts, if
any, as it deems necessary to establish a reserve for any governmental
charges payable out of a Trust. Amounts so withdrawn shall not be
considered a part of the assets of such Trust until such time as the
Trustee shall return all or any part of such amounts to the appropriate
account. In addition, the Trustee may withdraw from the Interest Account
and the Principal Account such amounts as may be necessary to cover
redemption of Units by the Trustee.
Record Dates for monthly distributions will be the fifteenth day of each
month. Distributions will be made on the last day of such month.
Distributions for an IRA, Keogh, pension fund or other tax-deferred
retirement plan will not be sent to the individual Unit holder; these
distributions will go directly to the custodian of the plan to avoid the
penalties associated with premature withdrawals from such accounts.
What Reports Will Unit Holders Receive?
The Trustee shall furnish Unit holders in connection with each
distribution a statement of the amount of interest, if any, and the
amount of other receipts, if any, which are being distributed, expressed
in each case as a dollar amount per Unit. Within a reasonable time after
the end of each calendar year, the Trustee will furnish to each person
who at any time during the calendar year was a Unit holder of record, a
statement as to (1) the Interest Account: interest received (including
amounts representing interest received upon any disposition of
Securities, penalties for the failure to make timely payments on
Securities or liquidated damages for default or breach of any condition
or term of the Securities), deductions for payment of applicable taxes
and for fees and expenses of a Trust, redemption of Units and the
balance remaining after such distributions and deductions, expressed
both as a total dollar amount and as a dollar amount representing the
pro rata share per Unit outstanding on the last business day of such
calendar year; (2) the Principal Account: payments of principal on
Securities, the dates of disposition of any Securities and the net
proceeds received therefrom (excluding any portion representing
interest), deduction for payment of applicable taxes and for fees and
expenses of a Trust, redemptions of Units, and the balance remaining
after such distributions and deductions expressed both as a total dollar
amount and as a dollar amount per Unit; (3) the Securities held and the
number of Units outstanding on the last business day of such calendar
year; (4) the Redemption Price per Unit based upon the last computation
thereof made during such calendar year; (5) the dollar amounts actually
distributed during such calendar year from the Interest Account and from
the Principal Account, separately stated; and (6) such other information
as the Trustee may deem appropriate. Unit holders of Units in
Page 18
uncertificated form shall receive no less frequently than once each year
a dated written statement containing the name, address and taxpayer
identification number, if any, of the registered owner, the number of
Units registered in the name of the registered owner on the date of the
statement and certain other information, that will be provided as
required under applicable law.
In order to comply with Federal and state tax reporting requirements,
Unit holders will be furnished, upon request to the Trustee, evaluations
of the Securities furnished to it by the Evaluator.
How May Units be Redeemed?
A Unit holder may redeem all or a portion of his Units by tender to the
Trustee at its corporate trust office in the City of New York of the
certificates representing the Units to be redeemed, or, in the case of
uncertificated Units, delivery of a request for redemption, duly
endorsed or accompanied by proper instruments of transfer with signature
guaranteed as explained above (or by providing satisfactory indemnity,
as in connection with lost, stolen or destroyed certificates), and
payment of applicable governmental charges, if any. No redemption fee
will be charged. On the third business day following such tender the
Unit holder will be entitled to receive in cash an amount for each Unit
equal to the Redemption Price per Unit next computed after receipt by
the Trustee of such tender of Units. The "date of tender" is deemed to
be the date on which Units are received by the Trustee, except that as
regards Units received after the close of trading on the New York Stock
Exchange (generally 4:00 p.m. Eastern time or as of any earlier closing
time on a day on which the New York Stock Exchange is scheduled in
advance to close at such earlier time), the date of tender is the next
day on which such Exchange is open for trading and such Units will be
deemed to have been tendered to the Trustee on such day for redemption
at the redemption price computed on that day. Units so redeemed shall be
canceled.
Accrued interest to the settlement date paid on redemption shall be
withdrawn from the Interest Account or, if the balance therein is
insufficient, from the Principal Account. All other amounts paid on
redemption shall be withdrawn from the Principal Account.
The Redemption Price per Unit (as well as the secondary market Public
Offering Price) will be determined on the basis of the bid price of the
Securities in a Trust while the Public Offering Price of Units during
the initial offering period will be determined on the basis of the
offering price of the Securities as of the close of trading on the New
York Stock Exchange (generally 4:00 p.m. Eastern time or as of any
earlier closing time on a day on which the New York Stock Exchange is
scheduled in advance to close at such earlier time) on the date any such
determination is made. At the opening of business on the Initial Date of
Deposit the Public Offering Price per Unit (which is based on the
offering prices of the Securities in a Trust and includes the sales
charge) exceeded the Unit value at which Units could have been redeemed
(based upon the current bid prices of the Securities in each Trust) by
the amount per Unit set forth in the "Summary of Essential Information."
The Redemption Price per Unit is the pro rata share of each Unit
determined by the Trustee on the basis of (1) the cash on hand in a
Trust or moneys in the process of being collected, (2) the value of the
Securities in a Trust based on the bid prices of the Securities and (3)
interest accrued on the Securities, less (a) amounts representing taxes
or other governmental charges payable out of a Trust and (b) the accrued
expenses of a Trust. The Evaluator may determine the value of the
Securities in a Trust (1) on the basis of current bid prices of the
Securities obtained from dealers or brokers who customarily deal in
securities comparable to those held by a Trust, (2) on the basis of bid
prices for securities comparable to any securities for which bid prices
are not available, (3) by determining the value of the Securities by
appraisal, or (4) by any combination of the above.
The difference between the bid and offering prices of such Securities
may be expected to average 1/16 to 1/4 of 1% of the principal amount of
such Securities. Therefore, the price at which Units may be redeemed
could be less than the price paid by the Unit holder. At the opening of
business on the Initial Date of Deposit the aggregate current offering
price of such Securities exceeded the Redemption Price (based upon
current bid prices of such Securities) by the aggregate amount and the
amount per Unit indicated in "Portfolio" for each Trust.
The Trustee is empowered to sell underlying Securities in order to make
funds available for redemption. To the extent that Securities are sold,
the size and diversity of a Trust will be reduced. Such sales may be
required at a time when Securities would not otherwise be sold and might
result in lower prices than might otherwise be realized.
Page 19
The right of redemption may be suspended and payment postponed for any
period during which the New York Stock Exchange is closed, other than
for customary weekend and holiday closings, or during which the
Securities and Exchange Commission determines that trading on that
Exchange is restricted or an emergency exists, as a result of which
disposal or evaluation of the Securities is not reasonably practicable,
or for such other periods as the Securities and Exchange Commission may
by order permit.
How May Units be Purchased by the Sponsor?
The Trustee shall notify the Sponsor of any tender of Units for
redemption. If the Sponsor's bid in the secondary market at that time
equals or exceeds the Redemption Price per Unit, it may purchase such
Units by notifying the Trustee before the close of business on the
second succeeding business day and by making payment therefor to the
Unit holder not later than the day on which the Units would otherwise
have been redeemed by the Trustee. Units held by the Sponsor may be
tendered to the Trustee for redemption as any other Units.
The offering price of any Units acquired by the Sponsor will be in
accord with the Public Offering Price described in the then currently
effective prospectus describing such Units. Any profit or loss resulting
from the resale or redemption of such Units will belong to the Sponsor.
How May Securities be Removed from a Trust?
The Sponsor is empowered, but not obligated, to direct the Trustee to
dispose of Securities in the event certain events occur that adversely
affect the value of Securities including default in payment of interest
or principal, default in payment of interest or principal of other
obligations guaranteed or backed by the full faith and credit of the
United States of America, institution of legal proceedings, default
under other documents adversely affecting debt service, decline in price
or the occurrence of other market or credit factors.
If any default in the payment of principal or interest on any Security
occurs and if the Sponsor fails to instruct the Trustee to sell or to
hold such Security within thirty days after notification by the Trustee
to the Sponsor of such default, the Trustee may, in its discretion, sell
the defaulted Security and not be liable for any depreciation or loss
thereby incurred. The Trustee may, from time to time, retain and pay
compensation to the Sponsor (or an affiliate of the Sponsor) to act as
agent for a Trust with respect to selling Securities from a Trust. In
acting in such capacity, the Sponsor or its affiliate will be held
subject to the restrictions under the Investment Company Act of 1940, as
amended.
The Trustee is also empowered to sell, for the purpose of redeeming
Units tendered by any Unit holder, and for the payment of expenses for
which funds may not be available, such of the Securities in a list
furnished by the Sponsor as the Trustee in its sole discretion may deem
necessary. Except as stated under "What is the First Trust Special
Situations Trust?", the acquisition by a Trust of any securities other
than the Securities initially deposited is prohibited. The Sponsor may
consider sales of Units of unit investment trusts which it sponsors in
making recommendation to the Trustee as to the selection of
broker/dealers to execute a Trust's portfolio transactions.
INFORMATION AS TO SPONSOR, TRUSTEE AND EVALUATOR
Who is the Sponsor?
Nike Securities L.P., the Sponsor, specializes in the underwriting,
trading and distribution of unit investment trusts and other securities.
Nike Securities L.P., an Illinois limited partnership formed in 1991,
acts as Sponsor for successive series of The First Trust Combined
Series, The First Trust Special Situations Trust, The First Trust
Insured Corporate Trust, The First Trust of Insured Municipal Bonds, The
First Trust GNMA, Templeton Growth and Treasury Trust, Templeton Foreign
Fund & U.S. Treasury Securities Trust and The Advantage Growth and
Treasury Securities Trust. First Trust introduced the first insured unit
investment trust in 1974 and to date more than $9 billion in First Trust
unit investments trusts have been deposited. The Sponsor's employees
include a team of professionals with many years of experience in the
unit investment trust industry. The Sponsor is a member of the National
Association of Securities Dealers, Inc. and Securities Investor
Protection Corporation and has its principal offices at 1001 Warrenville
Road, Lisle, Illinois 60532; telephone number (630) 241-4141. As of
December 31, 1995, the total partners' capital of Nike Securities L.P.
was $9,033,760 (audited). (This paragraph relates only to the Sponsor
Page 20
and not to the Trusts or to any series thereof. The information is
included herein only for the purpose of informing investors as to the
financial responsibility of the Sponsor and its ability to carry out its
contractual obligations. More detailed financial information will be
made available by the Sponsor upon request.)
Who is the Trustee?
The Trustee is The Chase Manhattan Bank, with its principal executive
office located at 270 Park Avenue, New York, New York 10017 and its unit
investment trust offices at 4 New York Plaza, 6th floor, New York, New
York 10004-2413. Unit holders who have questions regarding the Trusts
may call the Customer Service Help Line at 1-800-682-7520. The Trustee
is subject to supervision by the Superintendent of Banks of the State of
New York, the Federal Deposit Insurance Corporation and the Board of
Governors of the Federal Reserve System.
The Trustee, whose duties are ministerial in nature, has not
participated in the selection of the Securities. For information
relating to the responsibilities of the Trustee under the Indenture,
reference is made to the material set forth under "Rights of Unit Holders."
The Trustee and any successor trustee may resign by executing an
instrument in writing and filing the same with the Sponsor and mailing a
copy of a notice of resignation to all Unit holders. Upon receipt of
such notice, the Sponsor is obligated to appoint a successor trustee
promptly. If the Trustee becomes incapable of acting or becomes bankrupt
or its affairs are taken over by public authorities, the Sponsor may
remove the Trustee and appoint a successor as provided in the Indenture.
If upon resignation of a trustee no successor has accepted the
appointment within 30 days after notification, the retiring trustee may
apply to a court of competent jurisdiction for the appointment of a
successor. The resignation or removal of a trustee becomes effective
only when the successor trustee accepts its appointment as such or when
a court of competent jurisdiction appoints a successor trustee.
Any corporation into which a Trustee may be merged or with which it may
be consolidated, or any corporation resulting from any merger or
consolidation to which a Trustee shall be a party, shall be the
successor Trustee. The Trustee must be a banking corporation organized
under the laws of the United States or any State and having at all times
an aggregate capital, surplus and undivided profits of not less than
$5,000,000.
Limitations on Liabilities of Sponsor and Trustee
The Sponsor and Trustee shall be under no liability to Unit holders for
taking any action or for refraining from taking any action in good faith
pursuant to the Indenture, or for errors in judgment, but shall be
liable only for their own willful misfeasance, bad faith, gross
negligence (ordinary negligence in the case of the Trustee) or reckless
disregard of their obligations and duties. The Trustee shall not be
liable for depreciation or loss incurred by reason of the sale by the
Trustee of any of the Securities. In the event of the failure of the
Sponsor to act under the Indenture, the Trustee may act thereunder and
shall not be liable for any action taken by it in good faith under the
Indenture.
The Trustee shall not be liable for any taxes or other governmental
charges imposed upon or in respect of the Securities or upon the
interest thereon or upon it as Trustee under the Indenture or upon or in
respect of a Trust which the Trustee may be required to pay under any
present or future law of the United States of America or of any other
taxing authority having jurisdiction. In addition, the Indenture
contains other customary provisions limiting the liability of the Trustee.
If the Sponsor shall fail to perform any of its duties under the
Indenture or become incapable of acting or become bankrupt or its
affairs are taken over by public authorities, then the Trustee may (a)
appoint a successor Sponsor at rates of compensation deemed by the
Trustee to be reasonable and not exceeding amounts prescribed by the
Securities and Exchange Commission, or (b) terminate the Indenture and
liquidate the Trust as provided herein, or (c) continue to act as
Trustee without terminating the Indenture.
Who is the Evaluator?
The Evaluator is Securities Evaluation Service, Inc., 531 East Roosevelt
Road, Suite 200, Wheaton, Illinois 60187. The Evaluator may resign or
may be removed by the Sponsor and the Trustee, in which event the
Sponsor and the Trustee are to use their best efforts to appoint a
Page 21
satisfactory successor. Such resignation or removal shall become
effective upon the acceptance of appointment by the successor Evaluator.
If upon resignation of the Evaluator no successor has accepted
appointment within 30 days after notice of resignation, the Evaluator
may apply to a court of competent jurisdiction for the appointment of a
successor.
The Trustee, Sponsor and Unit holders may rely on any evaluation
furnished by the Evaluator and shall have no responsibility for the
accuracy thereof. Determinations by the Evaluator under the Indenture
shall be made in good faith upon the basis of the best information
available to it, provided, however, that the Evaluator shall be under no
liability to the Trustee, Sponsor or Unit holders for errors in
judgment. This provision shall not protect the Evaluator in any case of
willful misfeasance, bad faith, gross negligence or reckless disregard
of its obligations and duties.
OTHER INFORMATION
How May the Indenture be Amended or Terminated?
The Sponsor and the Trustee have the power to amend the Indenture
without the consent of any of the Unit holders when such amendment is
(1) to cure any ambiguity or to correct or supplement any provision of
the Indenture which may be defective or inconsistent with any other
provision contained therein, or (2) to make such other provisions as
shall not adversely affect the interest of the Unit holders (as
determined in good faith by the Sponsor and the Trustee), provided that
the Indenture is not amended to increase the number of Units issuable
thereunder or to permit the deposit or acquisition of securities either
in addition to or in substitution for any of the Securities initially
deposited in a Trust, except for the substitution of Replacement
Securities for Failed Securities or the purchase of additional
Securities pursuant to the Indenture. In the event of any amendment, the
Trustee is obligated to notify promptly all Unit holders of the
substance of such amendment.
A Trust may be liquidated at any time by consent of 100% of the Unit
holders or by the Trustee when the principal amount of the Securities
owned by such Series as shown by any evaluation, is less than the lower
of $1,000,000 or 10% of the total principal amount of the Securities
initially deposited in such Series, or in the event that Units not yet
sold aggregating more than 60% of the Units initially deposited are
tendered for redemption by the Sponsor. If a Trust is liquidated because
of the redemption of unsold Units by the Sponsor will refund to each
purchaser of Units the entire sales charge paid by such purchaser. The
Indenture will terminate upon the redemption, sale or other disposition
of the last Security held thereunder. In the event of termination,
written notice thereof will be sent by the Trustee to all Unit holders.
Within a reasonable period after termination, the Trustee will sell any
Securities remaining in a Trust, and, after paying all expenses and
charges incurred by a Trust, will distribute to each Unit holder
(including the Sponsor if it then holds any Units), upon surrender for
cancellation of his Units, his pro rata share of the balances remaining
in the Interest and Principal Accounts, all as provided in the Indenture.
Legal Opinions
The legality of the Units offered hereby will be passed upon by Chapman
and Cutler, 111 West Monroe Street, Chicago, Illinois 60603, as counsel
for the Sponsor. Carter, Ledyard & Milburn, 2 Wall Street, New York, New
York 10005, will act as counsel for the Trustee.
Experts
The statements of net assets, including the portfolios, of the Trusts at
the opening of business on the Initial Date of Deposit, appearing in
this Prospectus and Registration Statement have been audited by Ernst &
Young LLP, independent auditors, as set forth in their report thereon
appearing elsewhere herein and in the Registration Statement, and are
included in reliance upon such report given upon the authority of such
firm as experts in accounting and auditing.
Page 22
First Trust U.S. Treasury Securities Trust
Short-Term, Series 7
<TABLE>
<CAPTION>
Special Information
<S> <C>
Calculation of Estimated Net Annual Unit Income
Estimated Annual Interest Income per Unit $ .5975
Less: Estimated Annual Expense per Unit $ .0217
___________
Estimated Net Annual Interest Income per Unit $ .5758
Calculation of Interest Distribution per Unit
Estimated Net Annual Interest Income per Unit $ .5758
Divided by 12 $ .0480
Estimated Daily Rate of Net Interest Accrual per Unit $ .00159944
Estimated Current Return Based on Public Offering Price (1) 5.61%
Estimated Long-Term Return Based on Public Offering Price (1) 4.68%
CUSIP 33718T 266
</TABLE>
Trustee's Annual Fee $.0140 per Unit outstanding annually,
exclusive of expenses of the Trust,
commencing December 4, 1996.
Distributions
Estimated first distribution of $.0096 per Unit will be paid on December
31, 1996 to Unit holders of record on December 15, 1996 (The First
General Record Date).
Subsequent distributions will be paid on the last day of each month to
holders of record of Units on the fifteenth day of such month.
No distributions need be made from the Principal Account if the balance
therein is less than $1.00 per 100 Units.
[FN]
___________________
(1) The Estimated Current Return is computed by dividing the Estimated
Net Annual Interest Income per Unit by the Public Offering Price per
Unit. The Estimated Net Annual Interest Income per Unit will vary with
changes in fees and expenses of the Trustee, Sponsor and Evaluator and
with the principal prepayment, redemption, maturity, exchange or sale of
Securities while the Public Offering Price will vary with changes in the
offering price of the underlying Securities; therefore, there is no
assurance that the present Estimated Current Return indicated above will
be realized in the future. The Estimated Long-Term Return is calculated
using a formula which (1) takes into consideration, and determines and
factors in the relative weightings of, the market values, yields, (which
takes into account the amortization of premiums and the accretion of
discounts) and maturity of all of the Securities in the Trust and (2)
takes into account a compounding factor and the expenses and sales
charge associated with each Unit of such Series. Since the market values
and the expenses of the Trust will change, there is no assurance that
the present Estimated Long-Term Return as indicated above will be
realized in the future. The Estimated Current Return and Estimated Long-
Term Return are expected to differ because the calculation of the
Estimated Long-Term Return reflects the date and estimated amount of
principal returned while the Estimated Current Return calculation
includes only the Net Annual Interest Income and Public Offering Price.
Neither rate reflects the true return to Unit holders which is lower
because neither includes the effect of certain delays in distributions
to Unit holders. These figures are based on per 100 Unit cash flows.
Cash flows will vary with changes in fees and expenses, with the
principal prepayment, redemption, maturity, exchange or sale of the
underlying Securities. Estimated Cash Flows for this Series are
available from the Sponsor upon request.
Page 23
Portfolio
FIRST TRUST U.S. TREASURY SECURITIES TRUST
SHORT-TERM, SERIES 7
The First Trust Special Situations Trust, Series 144
At the Opening of Business on the Initial Date of Deposit
December 4, 1996
<TABLE>
<CAPTION>
Principal Amount Cost of Profit
of U.S. Treasury Coupon Cost to Securities or (Loss)
Securities (1) Rate Maturity Sponsor (2) to Trust (3) to Sponsor
________________ ______ ________ __________ ___________ __________
<S> <C> <C> <C> <C> <C>
$ 10,000 6.250% 6/30/1998 $ 10,122 $10,110 $(12)
10,000 5.500 11/15/1998 9,997 9,987 (10)
10,000 6.375 5/15/1999 10,178 10,169 (9)
10,000 5.875 11/15/1999 10,055 10,054 (1)
10,000 5.875 6/30/2000 10,053 10,049 (4)
__________ __________ _________ ________
$ 50,000 $ 50,405 $50,369 $(36)
========== ========== ========= ========
</TABLE>
[FN]
______________________
(1) The First Trust U.S. Treasury Securities Trust, Short-Term, Series 7
consists of five obligations. Each of the Securities represents 20% of
the aggregate principal amount of the Securities in the Trust. See "What
is the First Trust Special Situations Trust?" All of the U.S. Treasury
Securities in Series 7 consist of maturities of approximately 1.5-3.5
years which are "laddered" to return 40% of the Unit holders' principal
in 1998, 40% in 1999 and 20% in 2000.
(2) All Securities on the Initial Date of Deposit are represented by the
Sponsor's contracts to purchase such Securities. Such contracts were
acquired by the Sponsor on December 3, 1996. Interest will begin
accruing to the benefit of Unit holders from December 9, 1996, the First
Settlement Date of the Trust.
(3) The cost of the Securities to the Trust represents the offering side
evaluation of the Securities as determined by Securities Evaluation
Service, Inc. The offering side evaluation is greater than the current
bid side evaluation of the Securities which is the basis on which
Redemption Price per Unit is determined. The aggregate value based on
the bid side evaluation at the opening of business on the Initial Date
of Deposit was $50,346, which is $23 ($.0046 per Unit; .046% of the
aggregate principal amount) lower than the aggregate cost of the
Securities to the Trust based on the offering side evaluation.
Page 24
First Trust U.S. Treasury Securities Trust
Short-Intermediate, Series 8
<TABLE>
<CAPTION>
Special Information
<S> <C>
Calculation of Estimated Net Annual Unit Income
Estimated Annual Interest Income per Unit $ .5875
Less: Estimated Annual Expense per Unit $ .0216
___________
Estimated Net Annual Interest Income per Unit $ .5659
Calculation of Interest Distribution per Unit
Estimated Net Annual Interest Income per Unit $ .5659
Divided by 12 $ .0472
Estimated Daily Rate of Net Interest Accrual per Unit $.001571944
Estimated Current Return Based on Public Offering Price (1) 5.53%
Estimated Long-Term Return Based on Public Offering Price (1) 5.21%
CUSIP 33718T 274
</TABLE>
Trustee's Annual Fee $.0139 per Unit outstanding annually,
exclusive of expenses of the Trust,
commencing December 4, 1996.
Distributions
Estimated first distribution of $.0094 per Unit will be paid on December
31, 1996 to Unit holders of record on December 15, 1996 (The First
General Record Date).
Subsequent distributions will be paid on the last day of each month to
holders of record of Units on the fifteenth day of such month.
No distributions need be made from the Principal Account if the balance
therein is less than $1.00 per 100 Units.
[FN]
___________________
(1) The Estimated Current Return is computed by dividing the Estimated
Net Annual Interest Income per Unit by the Public Offering Price per
Unit. The Estimated Net Annual Interest Income per Unit will vary with
changes in fees and expenses of the Trustee, Sponsor and Evaluator and
with the principal prepayment, redemption, maturity, exchange or sale of
Securities while the Public Offering Price will vary with changes in the
offering price of the underlying Securities; therefore, there is no
assurance that the present Estimated Current Return indicated above will
be realized in the future. The Estimated Long-Term Return is calculated
using a formula which (1) takes into consideration, and determines and
factors in the relative weightings of, the market values, yields, (which
takes into account the amortization of premiums and the accretion of
discounts) and maturity of all of the Securities in the Trust and (2)
takes into account a compounding factor and the expenses and sales
charge associated with each Unit of such Series. Since the market values
and the expenses of the Trust will change, there is no assurance that
the present Estimated Long-Term Return as indicated above will be
realized in the future. The Estimated Current Return and Estimated Long-
Term Return are expected to differ because the calculation of the
Estimated Long-Term Return reflects the date and estimated amount of
principal returned while the Estimated Current Return calculation
includes only the Net Annual Interest Income and Public Offering Price.
Neither rate reflects the true return to Unit holders which is lower
because neither includes the effect of certain delays in distributions
to Unit holders. These figures are based on per 100 Unit cash flows.
Cash flows will vary with changes in fees and expenses, with the
principal prepayment, redemption, maturity, exchange or sale of the
underlying Securities. Estimated Cash Flows for this Series are
available from the Sponsor upon request.
Page 25
Portfolio
FIRST TRUST U.S. TREASURY SECURITIES TRUST
SHORT-INTERMEDIATE, SERIES 8
The First Trust Special Situations Trust, Series 144
At the Opening of Business on the Initial Date of Deposit
December 4, 1996
<TABLE>
<CAPTION>
Principal Amount Cost of Profit
of U.S. Treasury Coupon Cost to Securities or (Loss)
Securities (1) Rate Maturity Sponsor (2) to Trust (3) to Sponsor
________________ ______ ________ ___________ ___________ __________
<S> <C> <C> <C> <C> <C>
$ 10,000 5.875% 11/15/1999 $ 10,055 $ 10,054 $ (1)
10,000 5.500 12/31/2000 9,912 9,910 (2)
10,000 5.875 11/30/2001 10,031 10,028 (3)
10,000 6.375 8/15/2002 10,263 10,259 (4)
10,000 5.750 8/15/2003 9,916 9,912 (4)
___________ __________ __________ __________
$ 50,000 $ 50,177 $ 50,163 $(14)
=========== ========== ========== ==========
</TABLE>
[FN]
___________________
(1) The First Trust U.S. Treasury Securities Trust, Short-Intermediate,
Series 8 consists of five obligations. Each of the Securities represents
20% of the aggregate principal amount of the Securities in the Trust.
See "What is the First Trust Special Situations Trust?" All of the U.S.
Treasury Securities in Series 8 consist of maturities of approximately
3-7 years which are "laddered" to return 20% of the Unit holders'
principal in 1999, 20% in 2000, 20% in 2001, 20% in 2002 and 20% in 2003.
(2) All Securities on the Initial Date of Deposit are represented by the
Sponsor's contracts to purchase such Securities. Such contracts were
acquired by the Sponsor on December 3, 1996. Interest will begin
accruing to the benefit of Unit holders from December 9, 1996, the First
Settlement Date of the Trust.
(3) The cost of the Securities to the Trust represents the offering side
evaluation of the Securities as determined by Securities Evaluation
Service, Inc. The offering side evaluation is greater than the current
bid side evaluation of the Securities which is the basis on which
Redemption Price per Unit is determined. The aggregate value based on
the bid side evaluation at the opening of business on the Initial Date
of Deposit was $50,121, which is $42 ($.0084 per Unit; .084% of the
aggregate principal amount) lower than the aggregate cost of the
Securities to the Trust based on the offering side evaluation.
Page 26
REPORT OF INDEPENDENT AUDITORS
The Sponsor, Nike Securities L.P., and Unit Holders
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 144
We have audited the accompanying statements of net assets, including the
portfolios, of the First Trust Special Situations Trust, Series 144,
comprised of First Trust U.S. Treasury Securities Trust, Short-Term,
Series 7 and First Trust U.S. Treasury Securities Trust, Short-
Intermediate, Series 8, as of the opening of business on December 4,
1996. These statements of net assets are the responsibility of the
Trusts' Sponsor. Our responsibility is to express an opinion on these
statements of net assets based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the statements of net assets
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
statements of net assets. Our procedures included confirmation of the
letters of credit held by the Trustee and deposited in the Trusts at the
opening of business on December 4, 1996. An audit also includes
assessing the accounting principles used and significant estimates made
by the Sponsor, as well as evaluating the overall presentation of the
statements of net assets. We believe that our audit of the statements of
net assets provides a reasonable basis for our opinion.
In our opinion, the statements of net assets referred to above present
fairly, in all material respects, the financial position of the First
Trust Special Situations Trust, Series 144, comprised of First Trust
U.S. Treasury Securities Trust, Short-Term, Series 7 and First Trust
U.S. Treasury Securities Trust, Short-Intermediate, Series 8, at the
opening of business on December 4, 1996 in conformity with generally
accepted accounting principles.
ERNST & YOUNG LLP
Chicago, Illinois
December 4, 1996
Page 27
Statement of Net Assets
The First Trust Special Situations Trust, Series 144
At the Opening of Business on the Initial Date of Deposit
December 4, 1996
<TABLE>
<CAPTION>
First Trust
U.S. Treasury
Securities Trust
Short-Term
Series 7
________________
<S> <C>
NET ASSETS
Delivery statements relating to Sponsor's contracts to purchase Securities (1)(2) $ 50,369
Accrued interest on underlying Securities (2)(3) 609
_________
50,978
Less distributions payable (3) 609
_________
Net assets $ 50,369
=========
Outstanding Units of fractional undivided interest 5,000
ANALYSIS OF NET ASSETS
Cost to investors (4) $ 51,318
Less gross underwriting commissions (4) (949)
_________
Net assets $ 50,369
=========
</TABLE>
NOTES TO STATEMENTS OF NET ASSETS
(1) The aggregate offering price of the Securities in the Trust listed
under "Portfolio" on the Initial Date of Deposit herein and their cost
to the Trust are the same. The offering price shown above has been
determined by Securities Evaluation Service, Inc., certain shareholders
of which are officers of the Sponsor.
(2) Pursuant to delivery statements relating to contracts to purchase
Securities, an irrevocable letter of credit held by the Trustee has been
deposited in the Trust as collateral. The amount of available letter of
credit and the amount expected to be utilized as collateral for the
Trust is shown below. The amount expected to be utilized is (a) the cost
to the Trust of the principal amount of the Securities to be purchased,
(b) accrued interest on those Securities to the Initial Date of Deposit
and (c) accrued interest on those Securities from the Initial Date of
Deposit to the expected dates of delivery of the Securities.
<TABLE>
<CAPTION>
Accrued Accrued
Aggregate Interest to Interest to
Letter of Credit Offering Initial Expected
To be Price of Date of Dates of
Series Available Utilized Securities Deposit Delivery
______ _________ ________ ___________ ___________ ___________
<S> <C> <C> <C> <C> <C>
First Trust U.S. Treasury Securities
Trust, Short-Term, Series 7 $ 200,000 $ 50,978 $ 50,369 $ 609 $ 0
</TABLE>
(3) The Trustee will advance to the Trust the amount of accrued interest
to December 9, 1996, the First Settlement Date, for distribution to the
Sponsor as the Unit Holder of record.
(4) The aggregate cost to investors and the aggregate gross underwriting
commissions of 1.85% for the Trust are computed assuming no reduction of
sales charge for quantity purchases.
Page 28
Statement of Net Assets
The First Trust Special Situations Trust, Series 144
At the Opening of Business on the Initial Date of Deposit
December 4, 1996
<TABLE>
<CAPTION>
First Trust
U.S. Treasury
Securities Trust
Short-Intermediate
Series 8
__________________
<S> <C>
NET ASSETS
Delivery statements relating to Sponsor's contracts to purchase Securities (1)(2) $ 50,163
Accrued interest on underlying Securities (2)(3) 634
_________
50,797
Less distributions payable (3) 634
_________
Net assets $ 50,163
=========
Outstanding Units of fractional undivided interest 5,000
ANALYSIS OF NET ASSETS
Cost to investors (4) $ 51,161
Less gross underwriting commissions (4) (998)
_________
Net assets $ 50,163
=========
</TABLE>
NOTES TO STATEMENTS OF NET ASSETS
(1) The aggregate offering price of the Securities in the Trust listed
under "Portfolio" on the Initial Date of Deposit herein and their cost
to the Trust are the same. The offering price shown above has been
determined by Securities Evaluation Service, Inc., certain shareholders
of which are officers of the Sponsor.
(2) Pursuant to delivery statements relating to contracts to purchase
Securities, an irrevocable letter of credit held by the Trustee has been
deposited in the Trust as collateral. The amount of available letter of
credit and the amount expected to be utilized as collateral for the
Trust is shown below. The amount expected to be utilized is (a) the cost
to the Trust of the principal amount of the Securities to be purchased,
(b) accrued interest on those Securities to the Initial Date of Deposit
and (c) accrued interest on those Securities from the Initial Date of
Deposit to the expected dates of delivery of the Securities.
<TABLE>
<CAPTION>
Accrued Accrued
Aggregate Interest to Interest to
Letter of Credit Offering Initial Expected
To be Price of Date of Dates of
Series Available Utilized Securities Deposit Delivery
______ _________ ________ __________ ___________ ___________
<S> <C> <C> <C> <C> <C>
First Trust U.S. Treasury Securities
Trust, Short-Intermediate, Series 8 $ 200,000 $ 50,797 $ 50,163 $ 634 $ 0
</TABLE>
(3) The Trustee will advance to the Trust the amount of accrued interest
to December 9, 1996, the First Settlement Date, for distribution to
the Sponsor as the Unit Holder of record.
(4) The aggregate cost to investors and the aggregate gross underwriting
commissions of 1.95% for the Trust are computed assuming no reduction of
sales charge for quantity purchases.
Page 29
DESCRIPTION OF STANDARD & POOR'S RATING*
A Standard & Poor's rating on the units of an investment trust
(hereinafter referred to collectively as "units" and "trust") is a
current assessment of creditworthiness with respect to the investments
held by such trust. This assessment takes into consideration the
financial capacity of the issuers and of any guarantors, insurers,
lessees or mortgagors with respect to such investments. The assessment,
however, does not take into account the extent to which trust expenses
or portfolio asset sales for less than the trust's purchase price will
reduce payment to the Unit holder of the interest and principal required
to be paid on the portfolio assets. In addition, the rating is not a
recommendation to purchase, sell, or hold units, inasmuch as the rating
does not comment as to market price of the units or suitability for a
particular investor.
Trusts rated "AAA" are composed exclusively of assets that are rated
"AAA" by Standard & Poor's or, have, in the opinion of Standard &
Poor's, credit characteristics comparable to assets rated "AAA," or
certain short-term investments. Standard & Poor's defines its "AAA"
rating for such assets as the highest rating assigned by Standard &
Poor's to a debt obligation. Capacity to pay interest and repay
principal is very strong.
_________________________
* As described by Standard & Poor's.
Page 30
This page is intentionally left blank.
Page 31
CONTENTS:
Summary of Essential Information:
First Trust U.S. Treasury Securities
Trust, Short-Term, Series 7 3
First Trust U.S. Treasury Securities
Trust, Short-Intermediate, Series 8 4
The First Trust Special Situations Trust, Series 144:
What is the First Trust Special Situations Trust? 5
Risk Factors 7
What is the Rating of the Units? 8
What are Estimated Returns? 8
How is Accrued Interest Treated? 9
What are the Expenses and Charges? 9
What is the Tax Status of Unit Holders? 10
Why are Investments in a Trust Suitable
for Retirement Plans? 13
How Can Distributions to Unit Holders be Reinvested? 14
Public Offering:
How is the Public Offering Price Determined? 14
How are Units Distributed? 16
What are the Profits of the Sponsor? 16
Will There be a Secondary Market? 17
Rights of Unit Holders:
How is Evidence of Ownership Issued and
Transferred? 17
How are Interest and Principal Distributed? 18
What Reports Will Unit Holders Receive? 18
How May Units be Redeemed? 19
How May Units be Purchased by the Sponsor? 20
How May Securities be Removed from a Trust? 20
Information as to Sponsor, Trustee and Evaluator:
Who is the Sponsor? 20
Who is the Trustee? 21
Limitations on Liabilities of Sponsor and Trustee 21
Who is the Evaluator? 21
Other Information:
How May the Indenture be Amended or Terminated? 22
Legal Opinions 22
Experts 22
The Separate Trusts:
First Trust U.S. Treasury Securities
Trust, Short-Term, Series 7 23
First Trust U.S. Treasury Securities
Trust, Short-Intermediate, Series 8 25
Report of Independent Auditors 27
Statements of Net Assets:
First Trust U.S. Treasury Securities
Trust, Short-Term, Series 7 28
First Trust U.S. Treasury Securities
Trust, Short-Intermediate, Series 8 29
Description of Standard & Poor's Rating 30
________________
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS NOT LAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO, WHICH THE FUND
HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940,
AND TO WHICH REFERENCE IS HEREBY MADE.
FIRST TRUST (registered trademark)
First Trust U.S. Treasury Securities Trust
Short-Term
Series 7
First Trust U.S. Treasury Securities Trust
Short-Intermediate
Series 8
First Trust (registered trademark)
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
December 4, 1996
PLEASE RETAIN THIS PROSPECTUS
FOR FUTURE REFERENCE
Page 32
CONTENTS OF REGISTRATION STATEMENT
ITEM A Bonding Arrangements of Depositor:
Nike Securities L.P. is covered by a Broker's
Fidelity Bond, in the total amount of $1,000,000,
the insurer being National Union Fire Insurance
Company of Pittsburgh.
ITEM B This Registration Statement on Form S-6 comprises
the following papers and documents:
The facing sheet
The Cross-Reference Sheet
The Prospectus
The signatures
Exhibits
Financial Data Schedule
S-1
SIGNATURES
The Registrant, The First Trust Special Situations Trust,
Series 144, hereby identifies The First Trust Special
Situations Trust, Series 4 Great Lakes Growth and Treasury
Trust, Series 1, The First Trust Special Situations Trust,
Series 18 Wisconsin Growth and Treasury Securities Trust,
Series 1, The First Trust Special Situations Trust, Series 119
and The First Trust Combined Series 248, for purposes of the
representations required by Rule 487 and represents the
following:
(1) that the portfolio securities deposited in the series
as to the securities of which this Registration Statement is
being filed do not differ materially in type or quality from
those deposited in such previous series;
(2) that, except to the extent necessary to identify the
specific portfolio securities deposited in, and to provide
essential financial information for, the series with respect to
the securities of which this Registration Statement is being
filed, this Registration Statement does not contain disclosures
that differ in any material respect from those contained in the
registration statements for such previous series as to which
the effective date was determined by the Commission or the
staff; and
(3) that it has complied with Rule 460 under the
Securities Act of 1933.
Pursuant to the requirements of the Securities Act of
1933, the Registrant, The First Trust Special Situations Trust,
Series 144, has duly caused this Amendment to Registration
Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the Village of Lisle and State of
Illinois on December 4, 1996.
THE FIRST TRUST SPECIAL
SITUATIONS TRUST, SERIES 144
By NIKE SECURITIES L.P.
Depositor
By Robert M. Porcellino
Vice President
S-2
CONSENTS OF COUNSEL
The consents of counsel to the use of their names in the
Prospectus included in this Registration Statement will be
contained in their respective opinions to be filed as Exhibits
3.1, 3.2, 3.3 and 3.4 of the Registration Statement.
CONSENT OF ERNST & YOUNG LLP
The consent of Ernst & Young LLP to the use of its name
and to the reference to such firm in the Prospectus included in
this Registration Statement will be filed by amendment.
CONSENT OF FIRST TRUST ADVISORS L.P.
The consent of First Trust Advisors L.P. to the use of its
name in the Prospectus included in the Registration Statement
is filed as Exhibit 4.1 to the Registration Statement.
S-3
EXHIBIT INDEX
1.1 Form of Standard Terms and Conditions of trust for
The First Trust Special Situations Trust, Series 24
and subsequent Series effective January 23, 1992
among Nike Securities L.P., as Depositor, United
States Trust Company of New York as Trustee,
Securities Evaluation Service, Inc., as Evaluator,
and Nike Financial Advisory Services L.P. as
Portfolio Supervisor (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-45093] filed
on behalf of The First Trust Special Situations
Trust, Series 24).
1.1.1 Form of Trust Agreement for Series 144 among Nike
Securities L.P., as Depositor, The Chase Manhattan
Bank, as Trustee, Securities Evaluation Services,
Inc., as Evaluator and First Trust Advisors L.P., as
Portfolio Supervisor.
1.2 Copy of Certificate of Limited Partnership of Nike
Securities L.P. (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-42683] filed
on behalf of The First Trust Special Situations
Trust, Series 18).
1.3 Copy of Amended and Restated Limited Partnership
Agreement of Nike Securities L.P.. (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
42683] filed on behalf of The First Trust, Series
18).
1.4 Copy of Articles of Incorporation of Nike Securities
Corporation, the general partner of Nike Securities
L.P., Depositor (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-42683] filed
on behalf of The First Trust Special Situations
Trust, Series 18).
1.5 Copy of By-Laws of Nike Securities Corporation, the
general partner of Nike Securities L.P., Depositor
(incorporated by reference to Amendment No. 1 to Form
S-6 [file No. 33-42683] filed on behalf of The First
Trust Special Situations Trust, Series 18).
2.1 Copy of Certificate of Ownership (included in Exhibit
1.1 filed herewith on page 2 and incorporated herein
by reference).
3.1 Opinion of counsel as to legality of Securities being
registered.
3.2 Opinion of counsel as to Federal income tax status of
Securities being registered.
S-4
3.3 Opinion of counsel as to New York income tax status
of Securities being registered.
3.4 Opinion of counsel as to advancement of funds by
Trustee.
4.1 Consent of first Trust Advisors L.P.
4.2 Consent of Securities Evaluation Services, Inc.
4.3 Consent of Standard & Poor's Corporation.
6.1 List of Directors and Officers of Depositor and other
related information (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-42683] filed
on behalf of The First Trust Special Situations
Trust, Series 18).
7.1 Power of Attorney executed by the Director listed on
page S-3 of this Registration Statement (incorporated
by reference to Amendment No. 1 to Form S-6 [File No.
33-42683] filed on behalf of The First Trust Special
Situations Trust, Series 18).
______________________________________
S-5
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 144
TRUST AGREEMENT
Dated: December 4, 1996
This Trust Agreement among Nike Securities L.P., as
Depositor, The Chase Manhattan Bank, as Trustee, Securities
evaluation Service, Inc., as Evaluator, and First Trust
Advisors L.P., as Portfolio Supervisor, sets forth certain
provisions in full and incorporates other provisions by
reference to the document entitled "Standard Terms and
Conditions of Trust for the First Trust Special Situations
Trust, Series 24" effective January 23, 1992 (herein called
the "Standard Terms and Conditions of Trust"), and such
provisions as are set forth in full and such instrument.
All references herein to Articles and Sections are to
Articles and Sections of the Standard Terms and conditions
of Trust.
W I T N E S S E T H T H A T:
In consideration of the premises and of the mutual
agreements herein contained, the Depositor, the Trustee, the
Evaluator and Portfolio Supervisor agree as follows:
PART I
STANDARD TERMS AND CONDITIONS OF TRUST
Subject to the Provisions of Part II hereof, all the
provisions contained in the Standard Terms and Conditions of
Trust are herein incorporated by reference in their entirety
and shall be deemed to be a part of this instrument as fully
and to the same extent as though said provisions had been
set forth in full in this instrument.
PART II
SPECIAL TERMS AND CONDITIONS OF TRUST
The following special terms and conditions are hereby
agreed to:
(a) The Securities defined in Section 1.01(5) listed
in Schedule A hereto have been deposited in trust under this
Trust Agreement.
(b) The fractional undivided interest in and ownership
of the Trust Fund represented by each Unit for a Trust is
the amount set forth under the captions "Summary of
Essential Information - Fractional Undivided Interest in the
Trust per Unit" in the Prospectus.
(c) The number of units in a Trust referred to in
Section 2.03 is set forth under the caption "Summary of
Essential Information - Number of Units" in the Prospectus.
(d) For each Trust the First General Record Date and
the amount of the second distribution of funds from the
Interest Account shall be the record date for the Interest
Account and the amount set forth under "Trust Summary-
Initial Distribution" for such Trust in the Prospectus.
(e) For each Trust the "First Settlement Date" is the
date set forth under "Summary of Essential Information-First
Settlement Date" for such Trust in the Prospectus.
(f) Notwithstanding anything to the contrary in the
first three sentences of Section 6.04 of Article VI of the
Standard Terms and Conditions of Trust, the Trustee's fee
shall be calculated on the largest number of units
outstanding during each period in respect of which a payment
is made pursuant to Section 3.05, and the initial rate at
which such compensation is computed shall be the amount set
forth in "Special Trust Information" for such Trust in the
Prospectus.
(g) Notwithstanding anything to the contrary contained
in the Standard Terms and Conditions of Trust, "Portfolio
Supervisor" shall mean First Trust Advisors L.P. and its
successors in interest, or any successor portfolio
supervisor appointed as hereinafter provided.
PART III
A. Notwithstanding any provision to the contrary
contained in the Standard Terms and Conditions of trust and
in lieu of the receipt of Certificates evidencing ownership
of Units of the Fund, the Sponsor or any Underwriter of the
Fund listed under the caption "Underwriting" in the
Prospectus, at its option, may elect that Units of the Fund
owned by it be reflected by book entry on the books and
records of the trustee. For all purposes such Sponsor or
Underwriter shall be deemed the owner of such Units as if a
Certificate evidencing ownership of Units of the Fund had
actually been issued by the Trustee. The Units reflected by
book entry on the books and records of the trustee may be
transferable by the registered owner of such Units by
written instrument in form satisfactory to the Trustee. The
registered owner of Units reflected by book entry on the
books and records of the Trustee shall have the right at any
time to obtain Certificates evidencing ownership of such
Units.
B. Section 1.01(5) of the Standard Terms and
Conditions of Trust is hereby amended to delete the words
"such of the interest-bearing corporate debt obligations
(the "Corporate Bonds") and U.S. Treasury bonds" in the
first sentence thereof and inserting in their place the
words "U.S. Treasury bonds (the "Bonds")."
C. All reference in the Standard Terms and Conditions
of Trust to "Corporate bonds' are hereby amended to refer to
"Bonds".
D. Section 1.01(12), Section 1.01(13) and Section
2.05 of the Standard Terms and conditions of Trust are
hereby deleted in their entirety.
E. The sixth paragraph of Section 5.02 of the
Standard Terms and conditions of Trust is hereby amended by
deleting the third and fourth sentences thereof.
F. All reference in the Standard Terms and conditions
of Trust to the "Insurer", "Insurance" or "Insurance" are
hereby deleted.
G. The reference to "20%" in the first sentence of
Section 6,01(g) of the Standard Terms and conditions of
Trust is hereby amended to read "the lower of $1,000,000 or
10%.
H. Section 1.01(4) shall be amended to read as
follows:
"The Trustee, as of the "First Settlement Date", as
defined in Part II of the Trust Agreement, shall
advance from its own funds and shall pay to the
depositor the amount of interest accrued to such date
on the bonds deposited in the respective Trusts. The
Trustee, as of the "First Settlement Date, " as defined
in Part II of the Trust Agreement, shall also advance
to the Trust from its own funds and distribute to the
Depositor the amount specified in Part II of the Trust
Agreement, which is the amount by which the Trustee's
fee is reduced in respect of interest accrued on "when-
issued" Bonds and on Contract Bonds delivered to the
Trustee subsequent to the First Settlement Date
pursuant to Section 6.04. The Trustee shall be
entitled to reimbursement, without interest, for such
advancements form interest received by the Trust.
Subsequent distributions shall be made as hereinafter
provided."
I. Notwithstanding anything to the contrary in
Section 3.05, Certificateholders may not elect to receive
distributions on a semiannual basis.
J. Section 2.01. of Article II of the Standard Terms
and Conditions of Trust is hereby amended by inserting"(a)"
prior to the beginning of the text of the paragraph and
adding the following additional paragraphs:
(b) From time to time following the Initial Date
of Deposit, the Depositor is hereby authorized, in its
discretion, to assign, convey to and deposit with the
Trustee additional Bonds, in bearer form or duly endorsed in
blank or accompanied by all necessary instruments of
assignment and transfer in proper form (or contract
Obligations relating to such Bonds), to be held, managed and
applied by the Trustee as herein provided. Such deposit of
additional Bonds shall be made, in each case, pursuant to a
Notice of Deposit of Additional Bonds from the depositor to
the Trustee. The Depositor, in each case, shall ensure that
each deposit of additional Bonds pursuant to this Section
shall be, as nearly as is practicable, in the identical
ratio as the Percentage the Trust and the Depositor shall
ensure that such Bonds are The depositor shall deliver the
additional bonds which were Bonds and which were represented
by Contract Obligations within 10- calendar days after such
deposit of additional Bonds (the "Additional Bonds Delivery
Period"). If a contract to buy such Bonds between the
Depositor and seller is terminated by the seller thereof for
any reason beyond the are not delivered to the Trust by the
end of the Additional Bonds Delivery Period for such
deposit, the Trustee shall immediately draw on the Letter of
Credit, if any, in its entirety, apply the monies in
accordance with Section 2.01(d), and the Depositor shall
forthwith take the remedial action specified in Section
3.14. If the Depositor does not take the action specified
in Section 3.14 within 10 calendar days of the end of the
Additional Bonds Delivery Period, the Trustee shall
forthwith take the action specified in Section 3.14.
(c) In connection with the deposits described in
Section 2.01 (a) and (b), the Depositor has, in the case of
Section 2.01 (a) deposits, and, prior to the Trustee
accepting a Section 2.01(b) deposit, will, deposit cash
and/or Letter(s) of Credit in an amount sufficient to
purchase the Contract Obligations (the "Purchase Amount")
relating to Bonds which are not actually delivered to the
trustee at the time of such deposit, the terms of which
unconditionally allow the Trustee to draw on the full amount
of the available Letter of Credit. The trustee may deposit
such cash or cash drawn on the Letter of credit in a non-
interest bearing account for the Trust.
(d) In the event that the purchase of Contract
Obligations pursuant to any contract shall not be
consummated in accordance with said contract or if the Bonds
represented by Contract Obligations are not delivered to the
Trust in accordance with Section 2.01 (a) or 2.01 (b) and
the monies, or, if applicable, the monies drawn on the Letter
of Credit, deposited by the Depositor are not utilized for
Section 3.14 purchase price of New Bonds, such funds, to the
extent of the Replacement Bond was acquired pursuant to
Section 3.14, plus all amounts described in the next
succeeding two sentences shall be credited to the Principal
Account and distributed pursuant to Section 3.05 to Unit
holders of record as of the Record Date next following
the failure of consummation of such purchase. The Depositor
shall cause to be refunded to each Unit holder his pro rata
portion of the sales charge levied on the sale of Units to
such Unit holder attributable to such Failed Contract
Obligation. The Depositor shall also pay to the Trustee, for
distribution to the Unit holders, interest on the amount
of the purchase price to the Trust of the Failed Contract
Obligation, at the rate of 5% per annum to the date the
Depositor notifies the trustee that no Replacement Bond will
be purchased or, in the absence of such notification, to the
expiration date for purchase of a remaining from monies
drawn on the Letter of Credit which are not used to purchase
New Bonds or are not used to provide refunds to Unit holders
shall be paid to the Depositor.
(e) The trustee is hereby irrevocable authorized
to effect registration or transfer of the Bonds in fully
registered form to the name of the Trustee or to the name of
its nominee.
(f) In connection with and at the time of any
deposit of additional bonds pursuant to Section 2.01(b), the
Depositor shall exactly replicate Cash (as defined below)
received or receivable by the trust as of the date of such
deposit (other than amounts to be distributed solely to
persons other than holders of Units created by the deposit)
and, as to the Income account, cash or other property (other
than Bonds) received by the trust as of the date of the
distributions declared but not received as of the date of
the deposit, reduced by the amount of and cash or other
property received or receivable on any Bond allocable (in
accordance with the Trustee's calculation of the monthly
distribution from the income Account pursuant to Section
3.05) to a distribution made or to made in respect of a
Record Date occurring prior to the deposit. such
replication will be made on the basis of a fraction, the
numerator of which is the number of Units created by the
deposit and the denominator of which is the number of Units
which are outstanding immediately prior to the deposit.
K. Section 3.07 of Article III of the Standard Terms
and Conditions of trust is hereby amended by deleting "or"
immediately prior to paragraph (g) and adding the following
paragraph:
"; or (h) that Bonds need to be sold in order to meet
established principal distributions which are an
objective of the Trust as described in the Prospectus."
L. Section 1.01(2) shall be amended to read as
follows:
"(2) "Trustee" shall mean The Chase Manhattan
Bank, or any successor trustee appointed as hereinafter
provided."
All references to United States Trust Company of New
York in the Standard Terms and Conditions of Trust shall be
amended to refer to The Chase Manhattan Bank.
M. Section 1.01(4) shall be amended to read as
follows:
"(4) "Portfolio Supervisor" shall mean First Trust
Advisors L.P. and its successors in interest, or any
successor portfolio supervisor appointed as hereinafter
provided."
N. The third paragraph of Section 3.05 of Article III
of the Standard Terms and Conditions of Trust is hereby
amended to include the following subsection:
"Section (e) deduct from the Interest Account
or, to the extent funds are not available in such
Account, from the Principal Account and pay to the
Depositor the amount that it is entitled to receive
pursuant to Section 3.16.
O. Article III of the Standard Terms and Conditions
of Trust is hereby amended by inserting the following
paragraphs which shall be entitled Section 3.16.:
"Section 3.16. Bookkeeping and Administrative
Expenses. As compensation for providing bookkeeping
and other administrative services of a character
described in Section 26(a)(2)(C) of the Investment
Company Act of 1940 to the extent such services are in
addition to, and do not duplicate, the services to be
provided hereunder by the Trustee or the Portfolio
Supervisor, the Depositor shall receive against a
statement or statements therefor submitted to the
Trustee monthly or annually an aggregate annual fee in
an amount as set forth in the Prospectus times the
number of Units outstanding as of January 1 of such
year except for a year or years in which an initial
offering period as determined by Section 4.01 of this
Indenture occurs, in which case the fee for a month is
based on the number of Units outstanding at the end of
such month (such annual fee to be pro rated for any
calendar year in which the Depositor provides service
during less than the whole of such year), but in no
event shall such compensation when combined with all
compensation received from other unit investment trusts
for which the Depositor hereunder is acting as
Depositor for providing such bookkeeping and
administrative services in any calendar year exceed the
aggregate cost to the Depositor providing services to
such unit investment trusts. Such compensation may,
from time to time, be adjusted provided that the total
adjustment upward does not, at the time of such
adjustment, exceed the percentage of the total
increase, after the date hereof, in consumer prices for
services as measured by the United States Department of
Labor Consumer Price Index entitled "All Services Less
Rent of Shelter" or similar index, if such index should
no longer be published. The consent or concurrence of
any Unit holder hereunder shall not be required for any
such adjustment or increase. Such compensation shall
be paid by the Trustee, upon receipt of invoice
therefor from the Depositor, upon which, as to the cost
incurred by the Depositor of providing services
hereunder the Trustee may rely, and shall be charged
against the Interest and Principal Accounts on or
before the Distribution Date following the Monthly
Record Date on which such period terminates. The
Trustee shall have no liability to any
Certificateholder or other person for any payment made
in good faith pursuant to this Section.
If the cash balance in the Interest and Principal
Accounts shall be insufficient to provide for amounts
payable pursuant to this Section 3.16, the Trustee
shall have the power to sell (i) Bonds from the current
list of Bonds designated to be sold pursuant to Section
5.02 hereof, or (ii) if no such Bonds have been so
designated, such Bonds as the Trustee may see fit to
sell in its own discretion, and to apply the proceeds
of any such sale in payment of the amounts payable
pursuant to this Section 3.16.
Any moneys payable to the Depositor pursuant to
this Section 3.16 shall be secured by a prior lien on
the Trust Fund except that no such lien shall be prior
to any lien in favor of the Trustee under the
provisions of Section 6.04 herein.
P. The first sentence of Section 3.15. shall be
amended to read as follows:
"As compensation for providing supervisory
portfolio services under this Indenture, the Portfolio
Supervisor shall receive, in arrears, against a
statement or statements therefor submitted to the
Trustee monthly or annually an aggregate annual fee in
an amount which shall not exceed such amount set forth
in the Prospectus under "Summary of Essential
Information" per Unit outstanding as of January 1 of
such year except for a Trust during the year or years
in which an initial offering period as determined in
Section 4.01 of this Indenture occurs, in which case
the fee for a month is based on the number of Units
outstanding at the end of such month (such annual fee
to be pro rated for any calendar year in which the
Portfolio Supervisor provides services during less than
the whole of such year), but in no event shall such
compensation when combined with all compensation
received from other series of the Trust for providing
such supervisory services in any calendar year exceed
the aggregate cost to the Portfolio Supervisor for the
cost of providing such services."
Q. The following shall be added immediately following
the first sentence of paragraph (c) of Section 2.01:
"The Trustee may allow the Depositor to substitute
any Letter(s) of Credit deposited with the Trustee in
connection with the deposits described in Section
2.01(a) and (b) with cash in an amount sufficient to
satisfy the obligations to which the Letter(s) of
Credit relates. Any substituted Letter(s) of credit
shall be released by the Trustee."
IN WITNESS WHEREOF, Nike Securities L.P., The Chase
Manhattan Bank, Securities Evaluation Service, Inc. and
First Trust Advisors L.P. have each caused this Trust
Agreement to be executed and the respective corporate seal
to be hereto affixed and attested (if applicable) by
authorized officers; all as of the day, month and year first
above written.
NIKE SECURITIES L.P.,
Depositor
By Robert M. Porcellino
Senior Vice President
The Chase Manhattan Bank, Trustee
(SEAL) By Thomas Porrazzo
Vice President
Attest:
Rosalia A. Raviele
Second Vice President
SECURITIES EVALUATION SERVICE,
INC.,
Evaluator
(SEAL) By James R. Couture
President
Attest:
James G. Prince
Vice President and
Assistant Secretary
FIRST TRUST ADVISORS L.P.,
Portfolio Supervisor
By Robert M. Porcellino
Vice President
SCHEDULE A TO TRUST AGREEMENT
SECURITIES INITIALLY DEPOSITED
IN
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 144
(Note: Incorporated herein and made a part hereof is the
"Portfolio" as set forth for each Trust in the
Prospectus.)
CHAPMAN AND CUTLER
111 WEST MONROE STREET
CHICAGO, ILLINOIS 60603
December 4, 1996
Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
Re: The First Trust Special Situations Trust, Series 144
Gentlemen:
We have served as counsel for Nike Securities L.P., as
Sponsor and Depositor of The First Trust Special Situations Trust,
Series 144 in connection with the preparation, execution and
delivery of a Trust Agreement dated December 4, 1996 among Nike
Securities L.P., as Depositor, The Chase Manhattan Bank, as
Trustee, Securities Evaluation Service, Inc., as Evaluator, and
First Trust Advisors L.P., as Portfolio Supervisor, pursuant to
which the Depositor has delivered to and deposited the Securities
listed in Schedule A to the Trust Agreement with the Trustee and
pursuant to which the Trustee has issued to or on the order of the
Depositor a certificate or certificates representing units of
fractional undivided interest in and ownership of the Fund created
under said Trust Agreement.
In connection therewith, we have examined such pertinent
records and documents and matters of law as we have deemed
necessary in order to enable us to express the opinions
hereinafter set forth.
Based upon the foregoing, we are of the opinion that:
1. the execution and delivery of the Trust Agreement
and the execution and issuance of certificates evidencing the
Units in the Fund have been duly authorized; and
2. the certificates evidencing the Units in the Fund
when duly executed and delivered by the Depositor and the
Trustee in accordance with the aforementioned Trust
Agreement, will constitute valid and binding obligations of
the Fund and the Depositor in accordance with the terms
thereof.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement (File No.333-01285) relating to the
Units referred to above, to the use of our name and to the
reference to our firm in said Registration Statement and in the
related Prospectus.
Respectfully submitted,
CHAPMAN AND CUTLER
EFF:erg
CHAPMAN AND CUTLER
111 WEST MONROE STREET
CHICAGO, ILLINOIS 60603
December 4, 1996
Nike Securities L.P.
Suite 300
1001 Warrenville Road
Lisle, Illinois 60532
The Chase Manhattan Bank
4 New York Plaza, 6th Floor
New York, New York 10004-2413
Re: The First Trust Special Situations Trust, Series 144
Gentlemen:
We have acted as counsel for Nike Securities L.P., Depositor
of The First Trust Special Situations Trust, Series 144 (the
"Fund"), in connection with the issuance of units of fractional
undivided interests in the Trust of said Fund (the "Trust"),
under a Trust Agreement dated December 4, 1996 (the "Indenture")
among Nike Securities L.P., as Depositor, The Chase Manhattan
Bank, as Trustee, Securities Evaluation Service, Inc., as
Evaluator, and First Trust Advisors L.P., as Portfolio
Supervisor.
In this connection, we have examined the Registration
Statement, the form of Prospectus proposed to be filed with the
Securities and Exchange Commission, the Indenture and such other
instruments and documents as we have deemed pertinent. The
opinions expressed herein assume that each Trust will be
administered, and investments by a Trust from proceeds of
subsequent deposits, if any, will be made, in accordance with the
terms of the Indenture. Each Trust holds Treasury Obligations
and may include "stripped" U.S. Treasury bonds (the "Stripped
Treasury Securities") (collectively "the Securities") as such
term is defined in the Prospectus.
Based upon the foregoing and upon an investigation of such
matters of law as we consider to be applicable, we are of the
opinion that, under existing Federal income tax law:
(i) Each Trust is not an association taxable as a
corporation but will be governed by the provisions of
Subchapter J (relating to Trusts) of Chapter 1, Internal
Revenue Code of 1986 (the "Code").
(ii) Each Unit holder will be considered the owner of a
pro rata portion of each Security in each Trust and will be
considered to have received the interest on his pro rata
portion of each Security when interest on such Security is
received by the respective Trust. Each Unit holder will
also be required to include in taxable income for federal
income tax purposes, original issue discount with respect to
his interest in any Security held by each Trust which was
issued with original issue discount at the same time and in
the same manner as though the Unit holder were the direct
owner of such interest. Original issue discount will be
treated as zero with respect to the Securities if it is "de
minimis" within the meaning of Section 1273 of the Code and,
based upon a Treasury Regulation (the "Regulation") which
was issued on December 28, 1992 regarding the stripped bond
rules of the Code, original issue discount with respect to a
Stripped Treasury Security will be treated as zero if it is
"de minimis" as determined thereunder.
(iii) Each Unit holder will be considered the owner
of a pro rata portion of each asset in each Trust. The
total cost to a Unit holder of his Units, including sales
charges, is allocated among his pro rata portion of each
asset held by each Trust (in proportion to the fair market
values thereof on the valuation date closest to the date the
Unit holder purchases Units) in order to determine his
initial tax basis for his pro rata portion of each asset
held by each Trust. The Stripped Treasury Securities are
treated as bonds that were originally issued at an original
issue discount. Because the Stripped Treasury Securities
represent interests in "stripped" U.S. Treasury bonds, a
Unit holder's initial basis for his pro rata portion of each
Stripped Treasury Security held by the Trust (determined at
the time he acquires his Units, in the manner described
above) shall be treated as its "purchase price" by the Unit
holder. Under the special rules relating to stripped bonds,
original issue discount applicable to the Stripped Treasury
Securities is effectively treated as interest for Federal
income tax purposes and the amount of original issue
discount in this case is generally the difference between
the bond's purchase price and its stated redemption price at
maturity. A Unit holder will be required to include in
gross income for each taxable year the sum of his daily
portions of original issue discount attributable to the
Stripped Treasury Securities held by a Trust as such
original issue discount accrues and will in general be
subject to Federal income tax with respect to the total
amount of such original issue discount that accrues for such
year even though the income is not distributed to the Unit
holders during such year to the extent it is greater than or
equal to the "de minimis" amount described below. To the
extent the amount of such discount is less than the
respective "de minimis" amount, such discount shall be
treated as zero. In general, original issue discount
accrues daily under a constant interest rate method which
takes into account the semi-annual compounding of accrued
interest. In the case of Stripped Treasury Securities this
method will generally result in an increasing amount of
income to the Unit holders each year. A Unit holder's tax
basis for his pro rata portion of each asset held by a Trust
may be subject to adjustment as discussed in paragraph (v)
hereof.
(iv) The Unit holder's aliquot share of the total
proceeds received on the disposition of, or principal paid
with respect to, a Security held by a Trust will constitute
ordinary income (which will be treated as interest income
for most purposes) to the extent it does not exceed the
accrued market discount on such Security that has not
previously been included in taxable income by such Unit
holder. A Unit holder may generally elect to include market
discount in income as such discount accrues. In general,
market discount is the excess, if any, of the Unit holder's
pro rata portion of the outstanding principal balance of a
Security over the Unit holder's initial tax basis for such
pro rata portion, determined at the time such Unit holder
acquires his Units. However, market discount with respect
to any Security will generally be considered zero if it
amounts to less than 0.25% of the obligation's stated
redemption price at maturity times the number of years to
maturity. The market discount rules do not apply to
Stripped Treasury Securities because they are stripped debt
instruments subject to special original issue discount rules
as discussed above. If a Unit holder sells his Units, gain,
if any, will constitute ordinary income to the extent of the
aggregate of the accrued market discount on the Unit
holder's pro rata portion of each Security that is held by a
Trust that has not previously been included in taxable
income by such Unit holder. In general, market discount
accrues on a ratable basis unless the Unit holder elects to
accrue such discount on a constant interest rate basis.
However, no opinion is expressed herein regarding the
precise manner in which market discount accrues. The
deduction by a Unit holder for any interest expense incurred
to purchase or carry Units will be reduced by the amount of
any accrued market discount that has not yet been included
in taxable income by such Unit holder. In general, the
portion of any interest expense which is not currently
deducible would be ultimately deductible when the accrued
market discount is included in income.
(v) As discussed in paragraph (iv) hereof, if a Unit
holder sells his Units, gain, if any, will constitute
ordinary income to the extent of the aggregate of the
accrued market discount (which has not previously been
included in such Unit holder' taxable income) with respect
to a Unit holder's pro rata portion of each Security held by
a Trust. Any other gains (or losses) will be capital gains
(or losses) except in the case of a dealer or a financial
institution, and will be long-term if the Unit holder has
held his Units for more than one year. A Unit holder will
recognize taxable gains ( or losses) (a) upon redemption or
sale of his Units, (b) if the Trustee disposes of an asset
or (c) upon receipt by the Trustee of payments of principal
on the Securities. The amount of any such gain (or loss) is
measured by comparing the Unit holder's pro rata share of
the total proceeds from the transaction with his adjusted
tax basis in his Units or his pro rata interest in the asset
as the case may be, and then reducing such gain, if any, to
the extent characterized as ordinary income resulting from
accrued market discount as discussed above. A Unit holder's
tax basis in his Units and his pro rata portion of each of
the underlying assets of a Trust may be adjusted to reflect
the accrual of market discount (if the Unit holder has
elected to include such discount in income as it accrues),
original issue discount and amortized bond premium, if any.
The tax basis reduction requirements of said Code relating
to amortization of bond premium may, under some
circumstances, result in the Unit holder realizing a taxable
gain when his Units are sold or redeemed for an amount equal
to his original cost. In addition, Unit holders must reduce
the tax basis of their Units and their pro rata portion of
the underlying assets of each Trust for their share of
accrued interest received by such Trust, if any, on
Securities delivered after the Unit holders pay for their
Units to the extent that such interest accrued on such
Securities before the date the Trust acquired ownership of
the Securities (and the amount of this reduction may exceed
the amount of accrued interest paid to the seller) and,
consequently, such Unit holders may have an increase in
taxable gain or reduction in capital loss upon the
disposition of such Units or such Securities.
(vi) The Code provides that "miscellaneous itemized
deductions" are allowable only to the extent that they
exceed two percent of an individual taxpayer's adjusted
gross income. Miscellaneous itemized deductions subject to
this limitation under present law include fees of the
Trustee and the Evaluator but does not include amortizable
bond premium on Securities held by a Trust.
The Code provides a complex set of rules governing the
accrual of original issue discount, including special rules
relating to "stripped" debt instruments such as the Stripped
Treasury Securities. These rules provide that original issue
discount generally accrues on the basis of a constant compound
interest rate over the term of the security. Special rules apply
if the purchase price of a Treasury Obligation exceeds its
original issue price plus the amount of original issue discount
which would have previously accrued, based upon its issue price
(its "adjusted issue price"). Similarly, these special rules
would apply to a Unit holder if the tax basis of his pro rata
portion of a Treasury Obligation issued with original issue
discount exceeds his pro rata portion of its adjusted issue
price. In addition, as discussed above, the Regulation provides
that the amount of original issue discount on a stripped bond is
considered zero if the actual amount of original issue discount
on such stripped bond as determined under Section 1286 of the
Code is less that a "de minimis" amount, which, the Regulation
provides, is the product of (i) 0.25 percent of the stated
redemption price at maturity and (ii) the number of full years
from the date the stripped bond is purchased (determined
separately for each new purchaser thereof) to the final maturity
date of the bond.
For taxable years beginning after December 31, 1986 and
before January 1, 1996, certain corporations may be subject to
the environmental tax (the "Superfund Tax") imposed by Section
59A of the Code. Interest received from, and gains recognized
from the disposition of, a Security by a Trust or the sale of
Units by a Unit holder will be included by such corporations in
the computation of the Superfund Tax. Under current Code
provisions, the Superfund Tax does not apply to tax years
beginning on or after January 1, 1996. However, the Superfund
Tax could be extended retroactively.
The Revenue Reconciliation Act of 1993 (the Tax Act)
raised tax rates on ordinary income while capital gains remain
subject to a 28 percent maximum stated rate for taxpayers other
than corporations. Because some or all capital gains are taxed
at a comparatively lower rate under the Tax Act, the Tax Act
includes a provision that recharacterizes capital gains as
ordinary income in the case of certain financial transactions
that are (conversion transactions) effective for transactions
entered into after April 30, 1993.
A Unit holder who is a foreign investor (i.e., an investor
other than a U.S. citizen or resident or a U.S. corporation,
partnership, estate or trust) will not be subject to United
States Federal income taxes, including withholding taxes on
interest income (including any original issue discount) on, or
any gain from the sale or other disposition of his pro rata
interest in any Security held by a Trust or the sale of his Units
provided that all of the following conditions are met:
(i) the interest income or gain is not effectively
connected with the conduct by the foreign investor of a
trade or business within the United States;
(ii) with respect to any gain, the foreign investor
(if an individual) is not present in the United States for
183 days or more during his or her taxable year;
(iii) the Security was issued after July 18, 1984; and
(iv) the foreign investor provides all certification
which may be required of his status and of the matters
contained in clauses (i) and (ii) above.
The scope of this opinion is expressly limited to the
matters set forth herein and, except as expressly set forth
above, we express no opinion with respect to any other taxes,
including foreign, state or local taxes or collateral tax
consequences with respect to the purchase, ownership and
disposition of Units.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement (File No.333-01285)
relating to the Units referred to above and to the use of our
name and to the reference to our firm in said Registration
Statement and in the related Prospectus.
Very truly yours,
CHAPMAN AND CUTLER
EFF/erg
CARTER, LEDYARD & MILBURN
COUNSELLORS AT LAW
2 WALL STREET
NEW YORK, NEW YORK 10005
December 4, 1996
The Chase Manhattan Bank, as Trustee of
The First Trust Special
Situations Trust, Series 144
4 New York Plaza, 6th Floor
New York, New York 10004-2413
Attention: Mr. Paul J. Holland
Vice President
Re: The First Trust Special Situations Trust, Series 144
Dear Sirs:
We are acting as special counsel with respect to New York
tax matters for the unit investment trust or trusts included in
The First Trust Special Situations Trust, Series 144 (each, a
"Trust"), which will be established under a certain Standard
Terms and Conditions of Trust dated January 23, 1992, and a
related Trust Agreement dated as of today (collectively, the
"Indenture") among Nike Securities L.P., as Depositor (the
"Depositor"), Securities Evaluation Service, Inc., as Evaluator,
First Trust Advisors L.P., as Portfolio Supervisor and The Chase
Manhattan Bank as Trustee (the "Trustee"). Pursuant to the terms
of the Indenture, units of fractional undivided interest in the
Trust (the "Units") will be issued in the aggregate number set
forth in the Indenture.
We have examined and are familiar with originals or
certified copies, or copies otherwise identified to our
satisfaction, of such documents as we have deemed necessary or
appropriate for the purpose of this opinion. In giving this
opinion, we have relied upon the two opinions, each dated today
and addressed to the Trustee, of Chapman and Cutler, counsel for
the Depositor, with respect to the matters of law set forth
therein.
Based upon the foregoing, we are of the opinion that:
1. The Trust will not constitute an association taxable as
a corporation under New York law, and accordingly will not be
subject to the New York State franchise tax or the New York City
general corporation tax.
2. Under the income tax laws of the State and City of New
York, the income of the Trust will be considered the income of
the holders of the Units.
We consent to the filing of this opinion as an exhibit to
the Registration Statement (No. 333-01285) filed with the
Securities and Exchange Commission with respect to the
registration of the sale of the Units and to the references to
our name under the captions "What is the Federal Tax Status of
Unit Holders?" and "Legal Opinions" in such Registration
Statement and the preliminary prospectus included therein.
Very truly yours,
Carter, Ledyard & Milburn
CARTER, LEDYARD & MILBURN
COUNSELLORS AT LAW
2 WALL STREET
NEW YORK, NEW YORK 10005
December 4, 1996
The Chase Manhattan Bank,
as Trustee of
The First Trust Special Situations
Trust, Series 144
4 New York Plaza, 6th Floor
New York, New York 10004-2413
Attention: Mr. Paul J. Holland
Vice President
Re: The First Trust Special Situations Trust, Series 144
Dear Sirs:
We are acting as counsel for The Chase Manhattan Bank
("Chase") in connection with the execution and delivery of a
Trust Agreement (the Trust Agreement) dated today's date (which
Trust Agreement incorporates by reference certain Standard Terms
and Conditions of Trust dated January 23, 1992, and the same are
collectively referred to herein as the Indenture) among Nike
Securities L.P., as Depositor (the "Depositor"), Securities
Evaluation Service, Inc., as Evaluator, First Trust Advisors
L.P., as Portfolio Supervisor, and Chase, as Trustee (the
"Trustee"), establishing the unit investment trust or trusts
included in The First Trust Special Situations Trust, Series 144
(each, a "Trust"), and the confirmation by Chase, as Trustee
under the Indenture, that it has registered on the registration
books of the Trust the ownership by the Depositor of a number of
units constituting the entire interest in the Trust (such
aggregate units being herein called "Units"), each of which
represents an undivided interest in the respective Trust which
consists of taxable U.S. Treasury Bonds (including,
confirmations of contracts for the purchase of certain
bonds not delivered and cash, cash equivalents or an
irrevocable letter of credit or a combination thereof, in the
amount required for such purchase upon the receipt of such
bonds), such bonds being defined in the Indenture as Bonds
and referenced in the Schedule to the Indenture.
We have examined the Indenture, a specimen of the
certificates to be issued thereunder (the "Certificates"), the
Closing Memorandum dated today's date, and such other documents
as we have deemed necessary in order to render this opinion.
Based on the foregoing, we are of the opinion that:
1. Chase is a duly organized and existing corporation having
the powers of a trust company under the laws of the State of New
York.
2. The Trust Agreement has been duly executed and delivered by
Chase and, assuming due execution and delivery by the other
parties thereto, constitutes the valid and legally binding
obligation of Chase.
3. The Certificates are in proper form for execution and
delivery by Chase, as Trustee.
4. Chase, as Trustee, has registered on the registration books
of the Trust the ownership of the Units by the Depositor. Upon
receipt of confirmation of the effectiveness of the registration
statement for the sale of the Units filed with the Securities and
Exchange Commission under the Securities Act of 1933, the Trustee
may deliver Certificates for such Units, in such names and
denominations as the depositor may request, to or upon the order
of the depositor as provided in the Closing Memorandum.
5. Chase, as Trustee, may lawfully advance to the Trust amounts
as may be necessary to provide monthly interest distributions of
approximately equal amounts, and be reimbursed, without interest,
for any such advances from funds in the interest account on the
ensuing record date, as provided in the Indenture.
In rendering the foregoing opinion, we have not considered,
among other things, whether the Securities have been duly
authorized and delivered.
Very truly yours,
Carter, Ledyard & Milburn
SES
Securities Evaluation Service, Inc.
Suite 200
531 E. Roosevelt Road
Wheaton, Illinois 60187
December 4, 1996
Nike Securities L.P.
1001 Warrenville Road
Lisle, IL 60532
Re: THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 144
Gentlemen:
We have examined the Registration Statement File No. 333-
01285 for the above captioned fund. We hereby consent to the use
in the Registration Statement of the references to Securities
Evaluation Service, Inc. as evaluator.
You are hereby authorized to file a copy of this letter with
the Securities and Exchange Commission.
Sincerely,
Securities Evaluation Service, Inc.
James R. Couture
President
Standard & Poor's Ratings Group
Municipal Finance Department
25 Broadway
New York, New York 10004-1064
December 4, 1996
Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
Re: The First Trust Special Situations Trust Series 144,
First Trust U.S. Treasury Securities Trust, Short-Term,
Series 7
First Trust U.S. Treasury Securities Trust, Short-
Intermediate, Series 8
Pursuant to your request for a Standard & Poor's rating on
the units of the above-captioned Trust, SEC# 333-01285, we have
reviewed the information presented to us and have assigned an
'AAA' rating to the units in the Trust. The rating is a direct
reflection of the portfolio of the trust, which will be composed
solely of U.S. Treasury Notes fully guaranteed as to principal
and interest by the full faith and credit of the United States.
Standard & Poor's will maintain suveillance on the AAA
rating until January 2, 1998. On this date, the rating will be
automatically withdrawn by Standard & Poor's unless a post
effective letter is requested by the Trust.
You have permission to use the name of Standard & Poor's
Ratings Services, a division of The McGraw-Hill Companies, Inc.
and the above-assigned ratings in connection with your
dissemination of information relating to these units, provided
that it is understood that the rating is not "market" rating nor
a recommendation to buy, hold, or sell the units of the trust.
Further, it should be understood the rating does not take into
account the extent to which fund expenses or portfolio asset
sales for less than the fund's purchase price will reduce payment
to the unit holders of the interest and principal required to be
paid on the portfolio assets. S&P reserves the right to advise
its own clients, subscribers, and the public of the ratings. S&P
relies on the sponsor and its counsel, accountants, and other
experts for the accuracy and completeness of the information
submitted in connection with the rating. S&P does not
independently verify the truth or accuracy of any such
information.
This letter evidences our consent to the use of the name of
Standard & Poor's Ratings Group and the above-assigned rating in
the registration statement or prospectus relating to the units or
the trust. However, this letter should not be construed as a
consent by us, within the meaning of Section 7 of the Securities
Act of 1933, to the use of the name of Standard & Poor's Ratings
Group in connection with the ratings assigned to the securities
contained in the trust. You are hereby authorized to file a copy
of this letter with the Securities and Exchange Commission.
Please be certain to send us three copies of your final
prospectus as soon as it becomes available. Should we not
receive them within a reasonable time after the closing or should
they not conform to the representations made to us, we reserve
the right to withdraw the rating.
We are pleased to have had the opportunity to be of service
to you. Our bill will be sent to you within one month. If we
can be of further help, please do not hesitate to call upon us.
Sincerely,
Hyman C. Grossman
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND> This schedule contains summary financial information extracted
from Amendment number 1 to form S-6 and is qualified in its entirety by
reference to such Amendment number 1 to form S-6.
</LEGEND>
<SERIES>
<NUMBER> 7
<NAME> First Trust U.S. Treasury Securities
Trust, Short-Term
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> Other
<FISCAL-YEAR-END> DEC-04-1996
<PERIOD-START> DEC-04-1996
<PERIOD-END> DEC-04-1996
<INVESTMENTS-AT-COST> 50,369
<INVESTMENTS-AT-VALUE> 50,369
<RECEIVABLES> 0
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 50,369
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 50,369
<SHARES-COMMON-STOCK> 5,000
<SHARES-COMMON-PRIOR> 5,000
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 50,369
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 0
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 0
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 0
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND> This schedule contains summary financial information extracted
from Amendment number 1 to form S-6 and is qualified in its entirety by
reference to such Amendment number 1 to form S-6.
</LEGEND>
<SERIES>
<NUMBER> 8
<NAME> First Trust U.S. Treasury Securities
Trust, Short-Intermediate
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> Other
<FISCAL-YEAR-END> DEC-04-1996
<PERIOD-START> DEC-04-1996
<PERIOD-END> DEC-04-1996
<INVESTMENTS-AT-COST> 50,163
<INVESTMENTS-AT-VALUE> 50,163
<RECEIVABLES> 0
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 50,163
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 0
<TOTAL-LIABILITIES> 0
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 50,163
<SHARES-COMMON-STOCK> 5,000
<SHARES-COMMON-PRIOR> 5,000
<ACCUMULATED-NII-CURRENT> 0
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> 0
<NET-ASSETS> 50,163
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 0
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 0
<NET-CHANGE-FROM-OPS> 0
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> 0
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 0
<ACCUMULATED-NII-PRIOR> 0
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
