<PAGE>
File No. 333-25225
40 Act File No. 811-08103
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: NUVEEN UNIT TRUST, SERIES 4
B. Name of Depositor: JOHN NUVEEN & CO, INCORPORATED
C. Complete address of Depositor's principal executive offices:
333 West Wacker Drive
Chicago, Illinois 60606
D. Name and complete address of agents for service:
JOHN NUVEEN & CO. INCORPORATED
Attention: Gifford R. Zimmerman
333 West Wacker Drive
Chicago, Illinois 60606
CHAPMAN AND CUTLER
Attention: Eric F. Fess
111 West Monroe Street
Chicago, Illinois 60603
It is proposed that this filing will become effective (check appropriate box)
- ----
: : immediately upon filing pursuant to paragraph (b)
- ----
: : on (date) pursuant to paragraph (b)
- ----
: : 60 days after filing pursuant to paragraph (a)
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: : on (date) pursuant to paragraph (a) of rule 485 or 486
- ----
E. Title and amount of securities being registered: An indefinite number of
Units as permitted by Rule 24f-2.
F. Proposed maximum offering price to the public of the securities being
registered: Not presently determinable.
G. Amount of filing fee: $0.
H. Approximate date of proposed sale to the public: As soon as practicable
after the effective date of the Registration Statement.
: : Check box if it is proposed that this filing will become effective on
- ----
: : ______________ at 1:30 P.M. pursuant to Rule 487.
- ----
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<PAGE>
NUVEEN UNIT TRUST, SERIES 4
CROSS-REFERENCE SHEET
PURSUANT TO RULE 404(c) OF REGULATION C
UNDER THE SECURITIES ACT OF 1933
(FORM N-8B-2 ITEMS REQUIRED BY INSTRUCTION 1 AS
TO PROSPECTUS ON FORM S-6)
<TABLE>
<CAPTION>
FORM N-8B-2 FORM S-6
ITEM NUMBER HEADING IN PROSPECTUS
<C> <S> <C> <C>
I. ORGANIZATION AND GENERAL INFORMATION
1. (a) Name of trust ) Prospectus Cover Page
(b) Title of securities issued )
)
2. Name and address of Depositor ) Information About The Sponsor
)
3. Name and address of Trustee ) Information About The Sponsor
)
4. Name and address of principal Underwriter ) Information About The Sponsor
)
5. Organization of trust ) Nuveen Unit Trusts
)
6. Execution and termination of Trust Agreement ) Nuveen Unit Trusts
) Information About The Trustee
) Other Information
)
7. Changes of Name )
)
8. Fiscal Year )
)
9. Litigation )
II. GENERAL DESCRIPTION OF THE TRUST AND SECURITIES OF THE TRUST
10. General information regarding trust's securities ) Summary of Portfolios.
) Composition of Trusts
) Portfolio
) Distributions To Unitholders
) Redemption
) Removal of Securities From The Trusts
) Information About The Trustee
) Information About The Sponsor
) Other Information
) Tax Status
)
11. Type of securities comprising units ) Nuveen Unit Trusts
) Portfolio
) Summary Of Portfolios
) Composition Of Trusts
) Objectives Of The Trusts
<PAGE>
12. Certain information regarding periodic ) *
payment certificates )
)
13. (a) Loan, fees, expenses, etc. ) Essential Information
) Public Offering Price
) Market For Units
) Evaluation of Securities at the Initial Date Of Deposit
) Trust Operating Expenses
) Distributions To Unitholders
) Summary Of Portfolios
) Reports To Unitholders
)
(b) Certain information regarding periodic ) *
payment certificates )
)
(c) Certain percentages ) Public Offering Price
) Market For Units
) Evaluation of Securities at the Initial Date Of Deposit
)
(d) Certain other fees, etc. payable by holders ) Evaluation of Securities at the Initial Date Of Deposit
) Normal Trust Operating Expenses
) Ownership and Transfer of Units
)
(e) Certain profits received by depositor, principal ) Composition Of Trusts
underwriter, trustee or affiliated persons ) Purchase of Units by the Sponsor
)
(f) Ratio of annual charges to income ) *
)
14. Issuance of trust's securities ) Summary Of Portfolios
) Distributions To Unitholders
) How Certificates Are Issued
) Redemption
)
15. Receipt and handling of payments from purchasers ) *
2
<PAGE>
16. Acquisition and Disposition of Underlying Securities ) Nuveen Unit Trusts
) Summary Of Portfolios
) Composition Of Trusts
) Redemption
) Removal of Securities from the Trusts
) Other Information
)
17. Withdrawal or redemption ) Market For Units
) Redemption
) Purchase of Units by the Sponsor
)
18. (a) Receipt and disposition of income ) Summary Of Portfolios
) Distributions to Unitholders
) Reports to Unitholders
)
(b) Reinvestment of distributions ) Accumulation Plan
)
(c) Reserves or special funds ) Summary Of Portfolios
) Distributions to Unitholders
)
(d) Schedule of distributions ) *
)
19. Records, accounts and reports ) Distributions to Unitholders
) Reports to Unitholders
20. Certain miscellaneous provisions of Trust Agreement ) Information About the Trustee
) Information About the Sponsor
) Other Information
)
21. Loans to security holders ) *
)
22. Limitations on liability ) Summary of Portfolios
) Composition of Trusts
) Information About the Trustee
)
23. Bond arrangements ) *
)
24. Other material provisions of Trust Agreement ) *
III. ORGANIZATION, PERSONNEL AND AFFILIATED PERSONS OF DEPOSITOR
25. Organization of Depositor ) Information About the Sponsor
)
26. Fees received by Depositor ) *
27. Business of Depositor ) Information About the Sponsor
28. Certain information as to officials and affiliated ) *
persons of Depositor
)
29. Voting Securities of Depositor ) Information About the Sponsor
3
<PAGE>
30. Persons controlling Depositor )
)
31. Payments by Depositor for certain services rendered )
to trust )
)
32. Payments by Depositor for certain other services rendered ) *
to trust )
)
33. Remuneration of employees of Depositor for certain )
services rendered to trust )
)
34. Remuneration of other persons for certain services )
rendered to trust )
IV. DISTRIBUTION AND REDEMPTION OF SECURITIES
35. Distribution of trust's securities by states ) *
)
36. Suspension of sales of trust's securities )
)
37. Revocation of authority to distribute )
)
38. (a) Method of distribution )
(b) Underwriting agreements ) Distribution of Units to the Public
(c) Selling agreement )
)
39. (a) Organization of principal underwriter ) Information About the Sponsor
(b) NASD membership of principal underwriter )
)
40. Certain fees received by principal underwriter ) *
)
41. (a) Business of principal underwriter )
(b) Branch offices of principal underwriter ) *
(c) Salesmen of principal underwriter )
)
42. Ownership of trust's securities by certain persons ) *
)
43. Certain brokerage commissions received by principal ) *
underwriter
4
<PAGE>
44. (a) Method of valuation ) Essential Information
) Public Offering Price
) Evaluation of Securities at the Date Of Deposit
) Trust Operating Expenses
)
(b) Schedule as to offering price ) *
)
(c) Variation in offering price to certain persons ) Public Offering Price
) Evaluation of Securities at the Date Of Deposit
)
45. Suspension of redemption rights ) *
)
46. (a) Redemption valuation ) Unit Value And Evaluation
) Redemption Without Charge
) Purchase of Units by the Sponsor
)
(b) Schedule as to redemption price ) *
)
47. Maintenance of position in underlying securities ) Public Offering Price
) Purchase of Units by the Sponsor
V. INFORMATION CONCERNING THE TRUSTEE OR CUSTODIAN
48. Organization and regulation of Trustee ) Information About the Trustee
)
49. Fees and expenses of Trustee ) Essential Information
) Trust Operating Expenses
)
50. Trustee's lien ) Trust Operating Expenses
) Distributions to Unitholders
VI. INFORMATION CONCERNING INSURANCE OF HOLDERS OF SECURITIES
51. Insurance of holders of trust's securities ) *
5
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VII. POLICY OF REGISTRANT
52. (a) Provisions of trust agreement with respect to ) Trust Operating Expenses
selection or elimination of underlying securities ) Redemption
) Removal of Securities from the Trusts
)
(b) Transactions involving elimination of underlying ) *
securities )
)
)
(c) Policy regarding substitution elimination of ) Summary Of Portfolios
underlying or securities ) Composition Of Trusts
) Removal of Securities
)
(d) Fundamental policy not otherwise covered ) *
)
53. Tax status of trust ) Tax Status
VIII. FINANCIAL AND STATISTICAL INFORMATION
54. Trust's securities during last ten years ) *
55. )
)
56. Certain information regarding periodic payment certificate ) *
)
57. )
)
58. )
</TABLE>
_______________________
*Inapplicable, omitted, answer negative or not required.
6
<PAGE>
CONTENTS OF REGISTRATION STATEMENT
A. Bonding Arrangements of Depositor:
The Depositor has obtained the following Stockbrokers Blanket Bonds
for its officers, directors and employees:
INSURER/POLICY NO. AMOUNT
United Pacific Insurance Co.
Reliance Insurance Company $10,000,000
B 74 92 20
Aetna Casualty and Surety
08 F10618BCA $10,000,000
St. Paul Insurance Co.
400 HC 1051 $ 6,000,000
B. This amendment of Registration Statement comprises the following papers and
documents:
The facing sheet
The Prospectus
The signatures
Consents of Independent Public
Accountants and Counsel as indicated
Exhibits as listed on page S-5
C. Explanatory Note
This Amendment No. 1 to the Registration Statement may contain multiple
separate prospectuses. Each prospectus will relate to an individual unit
investment trust and will consist of a Part A, a Part B and an Information
Supplement. Each prospectus will be indentical with the exception of the
respective Part A which will contain the financial information specific to such
underlying unit investment trust.
D. Undertakings
1. With the exception of the information included in the appendices to
the Information Supplement, which will vary depending upon the make-up of a Fund
or updated to reflect current events, any amendment to a Fund's Information
Supplement will be subject to the review of the staff of the Securities and
Exchange Commission prior to distribution; and
2. The Information Supplement to the Trust will not include third party
financial information.
S-1
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Nuveen Unit Trust, Series 4 has duly caused this Amendment No. 1 to the
Registration Statement to be signed on its behalf by the undersigned thereunto
duly authorized in the City of Chicago and State of Illinois on the 29th day of
May, 1997.
NUVEEN UNIT TRUST, SERIES 4
(Registrant)
By JOHN NUVEEN & CO. INCORPORATED
(Depositor)
By Thomas C. Muntz
-------------------------------------
Vice President
Attest Morrison C. Warren
----------------------------------
Assistant Secretary
S-2
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this Amendment to
the Registration Statement has been signed below by the following persons in the
capacities and on the date indicated:
SIGNATURE TITLE* DATE
Timothy R. Schwertfeger Chairman, Board of Directors )
Chief Executive Officer )
and Director )
)
Anthony T. Dean President, Chief Operating ) LARRY W. MARTIN
Officer and Director ) Larry W. Martin
) Attorney-in-Fact**
)
John P. Amboian Chief Financial Officer and ) May 29, 1997
Executive Vice President )
)
)
O. Walter Renfftlen Vice President and Controller )
(Principal Accounting Officer) )
_______________________
* The titles of the persons named herein represent their capacity in and
relationship to John Nuveen & Co. Incorporated, the Depositor.
** The powers of attorney for Messrs. Amboian, Renfftlen, Dean and
Schwertfeger were filed as Exhibit 6 to Form N-8B-2 (File No. 811-08103).
S-3
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The consent of Arthur Andersen LLP to the use of its name in the Prospectus
included in the Registration Statement is filed by this amendment as Exhibit 4.4
to the Registration Statement.
CONSENT OF CHAPMAN AND CUTLER
The consent of Chapman and Cutler to the use of its name in the Prospectus
included in the Registration Statement is contained in its opinions filed by
this amendment as Exhibits 3.1 and 3.2 to the Registration Statement.
CONSENT OF THE CHASE MANHATTAN BANK
The consent of The Chase Manhattan Bank to the use of its name in the Prospectus
included in the Registration Statement is filed by this amendment as Exhibit 4.2
to the Registration Statement.
CONSENT OF CARTER, LEDYARD & MILBURN
The consent of Carter, Ledyard & Milburn to the use of its name in the
Prospectus included in the Registration Statement is filed by this amendment as
Exhibit 3.3 to the Registration Statement.
S-4
<PAGE>
LIST OF EXHIBITS
1.1(a) Copy of Standard Terms and Conditions of Trust between John Nuveen &
Co. Incorporated, Depositor and The Chase Manhattan Bank, Trustee.
1.1(b) Trust Indenture and Agreement.
2.1 Copy of Certificate of Ownership (Included in Exhibit 1.1(a) on pages
2 to 8, inclusive, 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.
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.
4.2 Consent of The Chase Manhattan Bank.
4.4 Consent of Arthur Andersen LLP.
6.1 List of Directors and Officers of Depositor and other related
information (incorporated by reference to Form S-6 [File No. 33-62325]
filed on September 7, 1995 on behalf of Nuveen Tax-Free Unit Trust,
Series 823).
S-5
<PAGE>
<TABLE>
<S> <C>
NUVEEN Nuveen-Standard&Poor's
Unit Trusts Quality Equity
Portfolio,
Series 1, May 1997
CUSIP 6706E1 108-DIVIDENDS IN CASH
CUSIP 6706E1 116-DIVIDENDS REINVESTED
PROSPECTUS PART A DATED MAY 29, 1997
</TABLE>
A NUVEEN UNIT TRUST WITH A PORTFOLIO OF COMMON STOCKS OF 15 COMPANIES, SELECTED
BY NUVEEN USING A SCREENING MODEL DEVELOPED BY NUVEEN WITH THE ASSISTANCE AND
EXPERTISE OF STANDARD & POOR'S, THAT SEEKS TO PROVIDE OVER THE NEXT 13 MONTHS
ABOVE AVERAGE CAPITAL APPRECIATION WITH A MODERATED LEVEL OF RISK AS COMPARED TO
THE S&P 500.
Overview
Nuveen -- Standard & Poor's Quality Equity Portfolio, Series 1 (the "Trust") is
a unit investment trust that is scheduled to terminate in approximately 13
months consisting of a portfolio of common stocks of companies with strong
historical earnings and dividends and credit quality. In determining the stocks
to be included in the portfolio, Nuveen used a screening model developed with
the assistance and expertise of Standard & Poor's that seeks to select a
portfolio of common stocks of companies with the potential for above average
capital appreciation with a moderated level of risk as compared to the S&P 500.
THIS PART A PROSPECTUS MAY NOT BE DISTRIBUTED UNLESS ACCOMPANIED BY THE
NUVEEN-STANDARD & POOR'S QUALITY EQUITY PORTFOLIO PROSPECTUS -- PART B WHICH IS
DATED MAY 29, 1997.
UNITS OF THE TRUST ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED OR ENDORSED
BY, ANY BANK AND ARE NOT FEDERALLY INSURED OR OTHERWISE PROTECTED BY THE FDIC OR
ANY OTHER FEDERAL AGENCY AND INVOLVE INVESTMENT RISK, INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL.
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.
<TABLE>
<S> <C>
Contents
1 OVERVIEW 6 INVESTING IN THE TRUST
2 TRUST SUMMARY AND FINANCIAL HIGHLIGHTS 6 Sales Charges
2 Essential Information 7 Dealer Concessions
2 Expense Information 7 GENERAL INFORMATION
4 TRUST STRATEGIES 7 Optional Features
4 Investment Objective 7 Secondary Market for Units
4 How the Trust Selects Investments 8 Termination
5 RISK FACTORS 8 Standard & Poor's
5 SECURITIES SELECTED FOR THE TRUST 8 The Sponsor
6 DISTRIBUTIONS 9 SCHEDULE OF INVESTMENTS
6 Income and Capital Distributions 10 STATEMENT OF CONDITION
11 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
</TABLE>
"Standard & Poor's" and "S&P" are trademarks of The McGraw-Hill Companies, Inc.
and have been licensed for use by John Nuveen & Co. Incorporated. The Trust is
not sponsored, managed, sold or promoted by Standard & Poor's.
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1
<PAGE>
Nuveen-Standard&Poor's
Quality Equity Portfolio, Series 1, May 1997
- --------------------------------------------
ESSENTIAL INFORMATION
TRUST SUMMARY AND FINANCIAL HIGHLIGHTS as of May 29, 1997
Initial Date of Deposit: May 29, 1997
Rollover Notification Date: June 15, 1998
Special Redemption and Liquidation Period:
June 30, 1998 -- July 15, 1998
Initial Number of Units(1): 303,382
Fractional Undivided Interest per Unit: 1/303,382
- --------------------------------------------------------------------------------
PUBLIC OFFERING PRICE (2)
Aggregate Offering Price of Securities: $3,003,489
Aggregate Offering Price of Securities per Unit: $9.90
Plus Maximum Initial Sales Charge per Unit: $0.10
Public Offering Price per Unit: $10.00
- ----------------------------------------------
MANDATORY TERMINATION DATE
July 15, 1998
INDUSTRY DIVERSIFICATION
Basic Industries 6.69%
Banks 20.02%
Capital Equipment 6.70%
Consumer Services 6.68%
Consumer Staples 20.00%
Financial 13.33%
Health Care 13.37%
Utilities 13.21%
- --------------------------------------------------------------------------------
EXPENSE INFORMATION
SALES CHARGES (MAXIMUM TOTAL 2.75%) (3)
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<S> <C>
Initial sales charge imposed on
purchases (as a % of Initial Public
Offering Price):.................... 1.00%
Amount per $1,000 invested............ $ 10.00
Deferred sales charge (as a % of
Initial Public Offering Price):..... 1.75%
Amount per $1,000 invested:........... $ 17.50
Maximum sales charge on reinvested
dividends:.......................... 1.75%
</TABLE>
- ----------------------------------------------
ESTIMATED ANNUAL OPERATING EXPENSES
(PER UNIT) (4)
- ----------------------------------------------
Trustee's Fee:___________________________________________________________$.00950
Organizational and
__Offering Expenses:_____________________________________________________$.03775
Total Annual Expenses:___________________________________________________$.04900
<PAGE>
- --------------------------------------------------------------------------------
Notes to Performance Information and Expense Information:
(1) As of the close of business on the Initial Date of Deposit, the number of
Units of the Trust may be adjusted so that the Public Offering Price per
Unit will equal approximately $10.00. Thereupon, to the extent of any such
adjustment, the fractional undivided interest per Unit will increase or
decrease accordingly, from the amounts indicated above.
(2) Each Security listed on a national securities exchange or the NASDAQ
National Market System is valued at the last closing sale price, or if no
such price exists or if the Security is not so listed, at the closing ask
price thereof.
(3) The maximum sales charge consists of an initial sales charge and a deferred
sales charge. Deferred sales charge payments will be paid from funds in the
Capital Account, if sufficient, or from the periodic sale of Securities. See
"Investing in the Trust-Sales Charges," below and "Public Offering Price" in
Part B of this Prospectus for additional information. On the Initial Date of
Deposit there will be no accumulated dividends in the Income Account. Anyone
ordering Units after such date will pay a pro rata share of any accumulated
dividends in such Income Account. The Public Offering Price as shown
reflects the value of the Securities at the opening of business on the
Initial Date of Deposit and establishes the original proportionate
relationship amongst the individual Securities. No sales to investors will
be executed at this price. Additional Securities may be deposited during the
day of the Initial Date of Deposit which will be valued as of 4:00 p.m.
Eastern time and sold to investors at a Public Offering Price per Unit based
on this valuation.
(4) The Trust (and therefore Unitholders) will bear all or a portion of its
organizational and offering costs (but not the expenses incurred in the
printing of preliminary and final prospectuses, nor the expenses incurred in
the preparation and printing of brochures and other advertising materials or
any other selling expenses), as is common for mutual funds. See "Trust
Operating Expenses" in Part B of this Prospectus and "Statement of
Condition." Historically, the sponsors of unit investment trusts have paid
all of the costs of establishing such trusts.
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3
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Trust Strategies
INVESTMENT OBJECTIVE
The objective of the Trust is to provide the potential for above-average capital
appreciation with moderated risk as compared to the S&P 500 by investing in the
common stocks of companies selected by Nuveen, using a screening model developed
with the assistance and expertise of Standard & Poor's. There is no assurance
that the Trust will achieve its investment objective.
INVESTMENT PHILOSOPHY
The Trust is a non-managed investment vehicle which employs a buy and hold
investment strategy. The Trust plans to hold, for approximately 13 months,
certain common stocks selected by Nuveen through the application of a
quantitative model developed by Nuveen with the assistance and expertise of
Standard & Poor's. At the end of the 13 month period, the portfolio will be
liquidated and the strategy is expected to be reapplied. Investors may reinvest
in the new portfolio at a reduced sales charge, if available. Each portfolio is
designed to be part of a longer term strategy and the Sponsor believes that more
consistent results are likely if the strategy is followed for at least 3-5
years. The Trust consists of a portfolio of common stocks of 15 companies that
have strong historical earnings and dividends, credit quality and have recently
reduced their outstanding shares of common stock by at least 1%. Standard &
Poor's indicates that it believes that the reduction of common shares
outstanding is typically the result of a share buyback program executed by the
company and generally reflects a strong cash flow position, and in turn, high
quality earnings. In addition, Standard & Poor's indicates that it believes a
buyback program may provide an indirect measure of the value of the stock, in
that management has judged that an investment in the company's own stock offers
more attractive returns than those available from other investment sources. In
order to create additional Units, the Sponsor expects to deposit additional
Securities in the Trust or cash (including a letter of credit) with instructions
to purchase additional Securities after the Initial Date of Deposit. Such
deposit of Securities will be done in a manner that will allow the original
proportionate relationship among the Securities to be maintained as closely as
practicable.
INVESTOR SUITABILITY
The Trust is a suitable investment for investors:
- - Seeking to own a 13 month common stock unit trust with the potential to
outperform the market over the next year;
- - Seeking the opportunity to purchase a defined portfolio of stocks of companies
with strong historical earnings and dividends and credit quality and have
recently reduced their outstanding shares of common stock by at least 1%.
The Trust is not a suitable investment if:
- - You are unwilling to assume the risks inherent in investing in common stocks
over a relatively short time horizon.
HOW THE TRUST SELECTS INVESTMENTS
The Securities included in the Trust's portfolio were selected by Nuveen using
the following four-step screening model (the "Quality Screening Model")
developed by Nuveen with the assistance and expertise of Standard & Poor's. For
the Trust, the screening model was applied on May 23, 1997. As an initial step,
only companies with market capitalizations equal to or in excess of $500 million
were eligible for inclusion in the Trust. The second step selected only those
companies ranked A+ or A by Standard & Poor's Earnings and Dividend Rankings for
Common Stocks, its highest rankings. The third filter selected only those
companies which had a Standard & Poor's Senior Debt Rating of at least AA-. As a
final step, from this universe of companies only those companies which have
reduced the number of common shares outstanding by at least 1% over the last
year (as of the company's most recent fiscal quarter for which information is
available) were selected for the Trust. See "SUMMARY OF PORTFOLIOS" and
"PORTFOLIO" in Part B of this Prospectus. A description of the Securities
included in the Trust are set forth below under "Securities Selected for the
Trust" and "Schedule of Investments."
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4
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Risk Factors
An investment in Units of the Trust should be made with an understanding of the
risks which an investment in common stocks may entail, including the risk that
the financial condition of the issuers of the Securities or the general
condition of the common stock market may worsen and the value of the Securities
and therefore the value of the Units may decline. The past market and earnings
performance of the Securities in the Trust is not predictive of their future
performance. Common stocks are especially susceptible to general stock market
movements and to volatile increases and decreases of value as market confidence
in and perceptions of the issuers change. These perceptions are based on
unpredictable factors including expectations regarding government, economic,
monetary and fiscal policies, inflation and interest rates, economic expansion
or contraction, and global or regional political, economic or banking crises.
The Trust's portfolio is not managed and Securities will not be sold by the
Trust regardless of market fluctuations, although Securities may be sold under
certain limited circumstances. Common stocks do not represent an obligation of
the issuer and, therefore, do not offer any assurance of income or provide the
same degree of protection of capital as do debt securities.
The value of common stocks is subject to market fluctuations for as long as the
common stocks remain outstanding, and thus the value of the Securities in the
Portfolio may be expected to fluctuate over the life of the Trust to values
higher or lower than those prevailing on the Initial Date of Deposit. Holders of
common stocks incur more risk than holders of preferred stocks and debt
obligations because common stockholders, as owners of the entity, have generally
inferior rights to receive payments from the issuer in comparison with the
rights of creditors of, or holders of debt obligations or preferred stocks
issued by, the issuer. There is no guarantee that the Trust will achieve its
objectives.
See "RISK FACTORS" in Part B of this Prospectus for an additional discussion of
potential risks.
Securities Selected for
the Trust
ABBOT LABORATORIES (ABT)
Quality Ranking: A+
Debt Rating: AAA
Abbott Laboratories discovers, develops, manufactures and markets a diversified
line of human health care products and services. Abbott also produces hospital
and laboratory products, including intravenous fluids.
AMERICAN INTERNATIONAL GROUP (AIG)
Quality Ranking: A+
Debt Rating: AAA
American International Group, Inc., through its member companies, underwrites
commercial and industrial insurance throughout the United States and abroad.
CITIZENS UTILITIES (CZN/A)
Quality Ranking: A+
Debt Rating: AA+
Citizen's Utilities Company is a diversified public utility providing
telecommunications, electric, gas, water and wastewater services to customers in
small communities, suburban and rural areas in 22 states.
GENERAL ELECTRIC (GE)
Quality Ranking: A+
Debt Rating: AAA
General Electric is a diversified manufacturing, technology and services
company. The conglomerate is among the world's 10 largest industrial firms.
GREAT LAKES CHEMICAL CORPORATION (GLK)
Quality Ranking: A+
Debt Rating: AA-
Great Lakes Chemical Corporation is a specialty chemical manufacturer. The
Company sells its products in the United States, Europe and Japan.
HERSHEY FOODS (HSY)
Quality Ranking: A
Debt Rating: AA-
Hershey Foods Corporation manufactures, distributes and sells consumer food
products. The Company produces and distributes a line of chocolate and
non-chocolate confectionery, grocery and pasta products.
KELLOGG COMPANY (K)
Quality Ranking: A
Debt Rating: AA
Kellogg Company manufactures cereal products and convenience foods. In addition,
Kellogg manufactures dessert mixes, soup bases, gelatin desserts and yogurt
products.
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5
<PAGE>
MERCK & CO., INC. (MRK)
Quality Ranking: A+
Debt Rating: AAA
Merck & Co. manufactures and produces a wide range of human and animal health
products and services.
NORTHERN TRUST CORPORATION (NTRS)
Quality Ranking: A
Debt Rating: AA-
Northern Trust is a Midwestern bank that attracts deposits and offers commercial
and residential real estate, consumer and leasing loans.
PITNEY BOWES, INC. (PBI)
Quality Ranking: A+
Debt Rating: AA
Pitney Bowes manufactures postage meters, related mailing equipment, dictation
systems, bar code product identification systems, fax machines and retail
labeling equipment.
SBC COMMUNICATIONS (SBC)
Quality Ranking: A
Debt Rating: AA-
SBC Communications, Inc. is a global telecommunications company providing local
and long-distance telephone, wireless, paging, internet access, cable TV and
messaging services.
STATE STREET CORPORATION (STT)
Quality Ranking: A+
Debt Rating: AA-
State Street Corporation is a servicer of institutional investors and manager of
financial assets worldwide.
STUDENT LOAN MARKETING ASSOCATION (SLM)
Quality Ranking: A
Debt Rating: AAA
Student Loan Marketing Association, "Sallie Mae", is a financial intermediary
serving the education credit market. The Company purchases and services student
loans made under federally sponsored student loan programs and provides other
financial and operational services to originators of such loans.
SYSCO CORPORATION (SYY)
Quality Ranking: A+
Debt Rating: AA-
SYSCO Corporation, the nations' largest food service distributor, provides
approximately 225,000 restaurants, hotels, schools, hospitals and other
institutions located throughout North America with over 185,000 different
products.
WACHOVIA CORPORATION (WB)
Quality Ranking: A
Debt Rating: AA
Wachovia Corporation, through its subsidiary banks, attracts deposits and offers
retail and corporate banking services including trust services.
Distributions
INCOME AND CAPITAL DISTRIBUTIONS
Cash dividends received by the Trust will be paid on December 31, 1997 to
Unitholders of record on December 15, 1997 and again as part of the final
liquidation distribution. Distributions of funds in the Capital Account, if any,
will be made as part of the final liquidation distribution, and in certain
circumstances, earlier. Any distribution of income and/or capital will be net of
expenses of the Trust. Additionally, upon termination of the Trust, the Trustee
will distribute, upon surrender of Units, to each remaining Unitholder (other
than a Rollover Unitholder as defined below) his pro rata share of the Trust's
assets, less expenses, in the manner set forth under "Distributions To
Unitholders" in Part B of this Prospectus. For distributions to Rollover
Unitholders, see "Special Redemption, Liquidation and Investment in a New
Trust." Any Unitholder may elect to have each distribution of income or capital
on his Units, other than the final liquidating distribution, automatically
reinvested in additional Units of the Trust subject only to remaining deferred
sales charge payments. See "Distributions To Unitholders" in Part B of this
Prospectus.
Investing in the Trust
SALES CHARGES
The maximum sales charge of 2.75% of the public offering price consists of an
initial sales charge equal to the difference between the maximum sales charge of
2.75% and the maximum remaining deferred sales charge, initially $.175 per Unit.
Commencing August 29, 1997, and on the last business day of each month
thereafter, through May 29, 1998 a deferred sales charge of $.0175 will be
assessed per Unit. Units purchased subsequent to the initial deferred sales
charge payment will be subject to the initial sales charge and the remaining
deferred sales charge payments not yet collected. Unitholders that purchase more
than 5,000 Units are entitled to reduced sales charges. In addition, certain
classes of investors are entitled to purchase Units at reduced sales charges.
See "Public Offering Price" in Part B of this Prospectus. Sales charges for
larger single transactions (including deferred sales charge) are as follows:
------
6
<PAGE>
- ----------------------------------------------
SALES CHARGES
<TABLE>
<CAPTION>
TOTAL PERCENT** OF
SALES NET AMOUNT
NUMBER OF UNITS* CHARGE INVESTED
- -------------------------------------- --------- -------------
<S> <C> <C>
Less than 5,000....................... 2.75% 2.778%
5,000 to 9,999........................ 2.50% 2.525%
10,000 to 24,999...................... 2.25% 2.273%
25,000 to 49,999...................... 2.00% 2.020%
50,000 to 99,999...................... 1.75% 1.768%
100,000 to 249,999.................... 1.00% 1.010%
Wrap Accounts......................... 0.65% 0.066%
Rollover (per Unit)................... $0.175 1.768%
</TABLE>
*Breakpoint sales charges are computed both on a dollar basis and on the basis
of the number of Units purchased, using the equivalent of 5,000 Units to
$50,000, 10,000 Units to $100,000 etc., and will be applied on that basis which
is more favorable to the purchaser.
**Percent of Net Amount Invested is based on the price as of the Initial Date of
Deposit. To the extent Units are priced differently, the Percent of Net Amount
Invested will be affected.
DEALER CONCESSIONS
The Sponsor plans to allow a discount to dealer firms in connection with the
distribution of Units. The discounts, based on number of Units sold, are as
follows:
- ----------------------------------------------
DEALER CONCESSIONS
<TABLE>
<CAPTION>
% DISCOUNT PER
NUMBER OF UNITS* UNIT
- ---------------------------------------------- ---------------
<S> <C>
Less than 5,000............................... 2.10%
5,000 to 9,999................................ 1.90
10,000 to 24,999.............................. 1.65
25,000 to 49,999.............................. 1.40
50,000 to 99,999.............................. 1.15
100,000 to 249,999............................ 0.50
Rollover...................................... 1.10
Wrap Accounts................................. 0.00
</TABLE>
General Information
OPTIONAL FEATURES
REDEMPTIONS
Units may be redeemed on any business day at their current market value. Units
tendered for redemption prior to such time as the entire deferred sales charge
on such Units has been collected will be assessed the remaining deferred sales
charge at the time of redemption. See "Redemption" in Part B of this Prospectus.
LETTER OF INTENT (LOI)
Investors may use a Letter of Intent to get reduced sales charges on purchases
made over a 13-month period (and to take advantage of dollar cost averaging).
Rollover Unitholders will not be permitted to apply New Trust purchases to
satisfy the LOI amount. The minimum LOI investment is $50,000. See "Public
Offering Price" in Part B of this Prospectus.
SPECIAL REDEMPTION, LIQUIDATION AND INVESTMENT IN A NEW TRUST
The Sponsor intends to create a separate series of the Trust (the "New Trust")
in conjunction with the termination of this series of the Trust. The portfolio
of the New Trust will contain common stocks that are selected by the Sponsor
using the same criteria and investment philosophy employed by this series of the
Trust. Unitholders may specify by June 15, 1998 to have their Units redeemed
in-kind, the distributed securities sold, and the proceeds invested in a New
Trust or a trust with a similar investment strategy at a reduced sales charge,
provided such New Trust or other similar trusts are offered and Units are
available. Cash not invested in a New Trust or such other trusts will be
distributed. (Such Unitholders are "Rollover Unitholders"). Rollover Unitholders
therefore will not receive a final liquidation distribution, but will receive
Units in a New Trust or other eligible trust. This exchange option may be
modified, terminated or suspended. See "Special Redemption, Liquidation and
Investment in a New Trust" in Part B of this Prospectus.
REINVESTMENT
Distributions from the Trust can be reinvested with no sales charge into Nuveen
mutual or money market funds. Also, income distributions from the Trust can be
reinvested at a reduced sales charge into additional Units of the Trust. See
"Distributions to Unitholders" and "Accumulation Plan" in Part B of this
Prospectus. For more information about Nuveen investment products, obtain a
prospectus from your financial adviser.
SECONDARY MARKET FOR UNITS
Although not obligated to do so, the Sponsor may maintain a market for Units and
offer to repurchase the Units at prices based on the aggregate value of the
Securities, plus or minus cash, if any, in the Capital and Income Accounts of
the Trust plus a sales charge. If a secondary market is not maintained, a
Unitholder may still redeem his Units through the Trustee. See "Redemption" in
Part B
------
7
<PAGE>
of this Prospectus. Any deferred sales charge remaining on Units at the time of
their sale or redemption will be collected at that time.
TERMINATION
Commencing on the Mandatory Termination Date, the Equity Securities will begin
to be sold as prescribed by the Sponsor. The Trustee will provide written notice
of the termination to Unitholders which will specify when certificates may be
surrendered. Unitholders not electing the "Rollover Option" will receive a cash
distribution within a reasonable time after the Trust's termination. See
"Distributions to Unitholders" and "Other Information -- Termination of
Indenture" in Part B of this Prospectus.
STANDARD & POOR'S
Standard & Poor's has over 130 years experience providing investment information
and analysis to the financial community. Standard & Poor's offers more than 60
research, analytical and financial information products and employs over 50
experienced equity analysts.
THE SPONSOR
Since our founding in 1898, John Nuveen & Co. Incorporated has been synonymous
with investments that withstand the test of time. Today, we offer a range of
equity and fixed-income unit trusts designed to suit the unique circumstances
and financial planning needs of mature investors. More than 1.3 million
investors have entrusted Nuveen to help them maintain the life-style they
currently enjoy.
The prospectus describes in detail the investment objectives, policies and risks
of this unit trust. We invite you to discuss the contents with your financial
adviser, or you may call us at 800-257-8787 for additional information.
------
8
<PAGE>
- --------------------------------------------------------------------------------
NUVEEN-STANDARD&POOR'S QUALITY EQUITY PORTFOLIO, SERIES 1, MAY 1997
(Nuveen Unit Trust, Series 4)
Schedule of Investments at the Initial Date of Deposit, May 29, 1997
<TABLE>
<CAPTION>
PERCENTAGE OF MARKET
NUMBER OF NAME OF ISSUER OF SECURITIES QUALITY AGGREGATE VALUE PER
SHARES (TICKER SYMBOL)(1) RANKING DEBT RATING OFFERING PRICE SHARE
<C> <C> <S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------
3,173 Abbott Laboratories (ABT) A+ AAA 6.67% $ 63.125
1,505 American International Group, Inc. (AIG) A+ AAA 6.68 133.375
21,575 Citizens Utilities Company; Class A Shares (CZN/A) A+ AA+ 6.55 9.125
3,291 General Electric Company (GE) A+ AAA 6.68 61.000
4,111 Great Lakes Chemical Corporation (GLK) A+ AA- 6.69 48.875
3,594 Hershey Foods Corporations (HSY) A AA- 6.70 56.000
2,748 Kellogg Company (K) A AA 6.67 72.875
2,191 Merck & Co., Inc. (MRK) A+ AAA 6.70 91.875
4,220 Northern Trust Corporation (NTRS) A AA- 6.66 47.375
2,816 Pitney Bowes, Inc. (PBI) A+ AA 6.70 71.500
3,447 SBC Communications (SBC) A AA- 6.66 58.000
4,430 State Street Corporation (STT) A+ AA- 6.66 45.125
1,657 Student Loan Marketing Association (SLM) A AAA 6.65 120.500
5,731 SYSCO Corporation (SYY) A+ AA- 6.63 34.750
3,339 Wachovia Corporation (WB) A AA 6.70 60.250
- ----------- ---
67,828 100%
- ----------- ---
- ----------- ---
<CAPTION>
COST OF
NUMBER OF SECURITIES TO
SHARES TRUST(2)
<C> <C>
- -----------
3,173 $ 200,296
1,505 200,729
21,575 196,872
3,291 200,751
4,111 200,925
3,594 201,264
2,748 200,261
2,191 201,298
4,220 199,923
2,816 201,344
3,447 199,926
4,430 199,904
1,657 199,669
5,731 199,152
3,339 201,175
- ----------- -------------
67,828 $ 3,003,489
- ----------- -------------
- ----------- -------------
</TABLE>
- -------------
(1) All Securities are represented by regular way contracts to purchase such
Securities for the performance of which an irrevocable letter of credit has
been deposited with the Trustee. The contracts to purchase the Securities
were entered into by the Sponsor on May 28, 1997.
(2) The cost of the Securities to the Trust represents the aggregate underlying
value with respect to the Securities acquired (generally determined by the
last sale prices of the listed Securities on the business day preceding the
Initial Date of Deposit). The valuation of the Securities has been
determined by the Trustee. The aggregate underlying value of the Securities
on the Initial Date of Deposit was $3,003,489. Cost and gain to Sponsor
relating to the Securities sold to the Trust were $2,999,743 and $3,746,
respectively.
------
9
<PAGE>
- --------------------------------------------------------------------------------
NUVEEN-STANDARD&POOR'S QUALITY EQUITY PORTFOLIO, SERIES 1, MAY 1997
(Nuveen Unit Trust, Series 4)
Statement of Condition at the Initial Date of Deposit, May 29, 1997
<TABLE>
<S> <C>
TRUST PROPERTY
Investment in Equity Securities represented by purchase contracts (1)(2)....... 3,003,489
Organizational and offering costs(3)........................................... 75,500
----------
Total............................................................. 3,078,989
----------
----------
LIABILITIES AND INTEREST OF UNITHOLDERS
LIABILITIES:
Deferred sales charge(4)................................................... 53,092
Accrued organizational and offering costs(3)............................... 75,500
----------
Total............................................................. 128,592
----------
----------
INTEREST OF UNITHOLDERS:
Units of fractional undivided interest outstanding (303,382)
Cost to investors(5)....................................................... 3,032,993
Less: Gross underwriting commission(6)................................. 82,596
----------
Net amount applicable to investors......................................... 2,950,397
----------
Total............................................................. 3,078,989
----------
----------
</TABLE>
- ------------
(1) Aggregate cost of Securities listed under "SCHEDULE OF INVESTMENTS" is
based on their aggregate underlying value.
(2) An irrevocable letter of credit totaling $3,003,489 has been deposited with
the Trustee as collateral, which is sufficient to cover the monies necessary
for the purchase of the Securities pursuant to contracts for the purchase of
such Securities.
(3) The Trust (and therefore Unitholders) will bear all or a portion of its
estimated organizational and offering costs which will be deferred and
amortized over the first 12 months of the Trust. The estimated
organizational and offering costs are based upon an estimate that two
million Units of the Trust will be issued. To the extent the number of Units
issued is larger or smaller, the estimate will vary.
(4) Represents the amount of mandatory distributions from the Trust ($0.175 per
Unit), payable to the Sponsor in ten equal monthly installments beginning on
August 29, 1997, and on the last business day of each month thereafter
through May 29, 1998.
(5) Aggregate Public Offering Price computed as set forth under "PUBLIC
OFFERING PRICE" in Part B of this Prospectus.
(6) The gross underwriting commission of 2.75% of the Public Offering Price
includes both an up-front and a deferred sales charge and has been
calculated on the assumption that the Units sold are not subject to a
reduction of sales charge for quantity purchases. In single transactions
involving 5,000 Units or more, the sales charge is reduced. (See "PUBLIC
OFFERING PRICE" in Part B of this Prospectus.)
------
10
<PAGE>
Report of Independent Public Accountants
TO THE BOARD OF DIRECTORS OF JOHN NUVEEN & CO. INCORPORATED AND UNITHOLDERS OF
NUVEEN UNIT TRUST, SERIES 4:
We have audited the accompanying statement of condition and the schedule of
investments at date of deposit (included in Part A of this Prospectus) of Nuveen
Unit Trust, Series 4 (Nuveen--Standard & Poor's Quality Equity Portfolio, Series
1, May 1997), as of May 29, 1997. These financial statements are the
responsibility of the Sponsor. Our responsibility is to express an opinion on
these financial statements 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 financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. Our procedures included
confirmation of the irrevocable letter of credit arrangement for the purchase of
securities, described in Note (1) to the statement of condition, by
correspondence with the Trustee. An audit also includes assessing the accounting
principles used and significant estimates made by the Sponsor, as well as
evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.
In our opinion, the statement of condition and the schedule of investments at
date of deposit referred to above present fairly, in all material respects, the
financial position of Nuveen Unit Trust, Series 4 (Nuveen-- Standard & Poor's
Quality Equity Portfolio, Series 1, May 1997) as of May 29, 1997, in conformity
with generally accepted accounting principles.
ARTHUR ANDERSEN LLP
Chicago, Illinois
May 29, 1997.
------
11
<PAGE>
NUVEEN UNIT TRUSTS
NUVEEN -- STANDARD & POOR'S QUALITY EQUITY PORTFOLIO PROSPECTUS --
PART B
(GENERAL TERMS)
MAY 29, 1997
This Part B of the Prospectus may not be distributed unless accompanied by
Part A. Both Parts of this Prospectus should be retained for future reference.
FURTHER DETAIL REGARDING CERTAIN OF THE INFORMATION PROVIDED IN THE
PROSPECTUS MAY BE OBTAINED WITHIN FIVE BUSINESS DAYS OF WRITTEN OR TELEPHONIC
REQUEST TO THE TRUSTEE AT 4 NEW YORK PLAZA, NEW YORK, NY 10004-2413 OR (800)
257-8787.
CURRENTLY OFFERED AT PUBLIC OFFERING PRICE PLUS ACCUMULATED DIVIDENDS
ACCRUED TO THE DATE OF SETTLEMENT. MINIMUM PURCHASE--EITHER $3,000 OR 30 UNITS
($1,000 FOR IRA PURCHASES), WHICHEVER IS LESS.
THIS NUVEEN UNIT TRUST SERIES consists of the underlying separate unit
investment trusts set forth in Part A to this Prospectus. Each Trust initially
consists of delivery statements relating to contracts to purchase securities
and, thereafter, will consist of a portfolio of common stocks of companies
selected by Nuveen using a screening model developed by Nuveen with the
assistance and expertise of Standard & Poor's (see "SCHEDULE OF INVESTMENTS"
appearing in Part A of this Prospectus and "SUMMARY OF PORTFOLIOS"). Except in
specific instances as noted in Part A of this Prospectus, the information
contained in this Part B shall apply to each Trust in its entirety. For a
discussion of the Sponsor's obligations in the event of a failure of any
contract for the purchase of any of the Securities and its limited right to
substitute other securities to replace any failed contract, see "COMPOSITION OF
TRUSTS."
THE OBJECTIVE of the Trust is to provide the potential for above average
capital appreciation with a moderated level of risk as compared to the S&P 500.
DIVIDEND AND CAPITAL DISTRIBUTIONS. Cash dividends received by the Trust
will be paid on those dates set forth under "DISTRIBUTIONS" in Part A of the
Prospectus. Distributions of funds in the Capital Account, if any, will be made
as part of the final liquidation distribution, and in certain circumstances,
earlier.
THE PUBLIC OFFERING PRICE per Unit of each Trust during the initial offering
period is equal to a pro rata share of the aggregate underlying value of the
Securities in such Trust's portfolio (generally determined by the closing sale
prices of listed Securities and the ask prices of over-the-counter traded
Securities) plus or minus cash, if any, in the Income and Capital Accounts of
the Trust, plus a sales charge as set forth in Part A of the Prospectus. The
Secondary Market Public Offering Price per Unit for each Trust will be equal to
a pro rata share of the aggregate underlying value of the Securities in such
Trust (generally determined by the closing sale prices of listed Securities and
the bid prices of over-the-counter traded Securities) plus the sales charges as
set forth in Part A of the Prospectus. A pro rata share of accumulated
dividends, if any, in the Income Account from the preceding Record Date to, but
not including, the settlement date (normally three business days after purchase)
is added to the Public Offering Price. The sales charge is reduced on a
graduated scale for sales involving at least the number of Units set forth in
Part A of this Prospectus.
A UNITHOLDER MAY REDEEM UNITS at the office of the Trustee at prices based
upon the aggregate underlying value of the Securities (generally determined by
the closing sale prices of listed Securities and the bid prices of
over-the-counter traded Securities). The price received upon redemption may be
more or less than the amount paid by Unitholders, depending upon the value of
the Securities on the date of tender for redemption. (See "REDEMPTION.") The
Sponsor, although not required to do so, may make a secondary market for the
Units of the Trusts at prices based upon the aggregate underlying value of the
Securities in the respective Trusts (generally determined by the closing sale
prices of listed Securities and the bid prices of
<PAGE>
over-the-counter traded Securities). Units subject to a deferred sales charge
which are tendered for redemption prior to such time as the entire deferred
sales charge on such Units has been collected will be assessed the amount of the
remaining deferred sales charge at the time of redemption. (See "MARKET FOR
UNITS.")
RISK FACTORS. An investment in a Trust should be made with an understanding
of the risks associated therewith, including, among other factors, the possible
deterioration of either the financial condition of the issuers or the general
condition of the stock market (which currently are at historically high levels),
changes in interest rates and economic recession. Volatility in the market price
of the Securities in the Trust changes the value of the Units of such Trust.
Unitholders tendering Units for redemption during periods of market volatility
may receive redemption proceeds which are more or less than they paid for the
Units. The Trusts' portfolios are not managed and Securities will not be sold by
a Trust regardless of market fluctuations, although certain Securities may be
sold under certain limited circumstances. See "RISK FACTORS."
"Standard & Poor's" and "S&P" are trademarks of The McGraw-Hill Companies,
Inc. and have been licensed for use by John Nuveen & Co. Incorporated. The Trust
is not sponsored, managed, sold or promoted by Standard & Poor's.
2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
NUVEEN UNIT TRUSTS.................................................................... 4
OBJECTIVES OF THE TRUSTS.............................................................. 5
SUMMARY OF PORTFOLIOS................................................................. 5
COMPOSITION OF TRUSTS................................................................. 5
PORTFOLIO............................................................................. 6
RISK FACTORS.......................................................................... 8
PUBLIC OFFERING PRICE................................................................. 9
MARKET FOR UNITS...................................................................... 11
EVALUATION OF SECURITIES AT THE INITIAL DATE OF DEPOSIT............................... 12
TAX STATUS............................................................................ 12
RETIREMENT PLANS...................................................................... 16
TRUST OPERATING EXPENSES.............................................................. 16
DISTRIBUTIONS TO UNITHOLDERS.......................................................... 17
ACCUMULATION PLAN..................................................................... 18
REPORTS TO UNITHOLDERS................................................................ 19
UNIT VALUE AND EVALUATION............................................................. 19
DISTRIBUTIONS OF UNITS TO THE PUBLIC.................................................. 19
OWNERSHIP AND TRANSFER OF UNITS....................................................... 20
REPLACEMENT OF LOST, STOLEN OR DESTROYED CERTIFICATES................................. 21
REDEMPTION............................................................................ 21
SPECIAL REDEMPTION, LIQUIDATION AND INVESTMENT IN A NEW TRUST......................... 23
PURCHASE OF UNITS BY THE SPONSOR...................................................... 24
REMOVAL OF SECURITIES FROM THE TRUSTS................................................. 24
INFORMATION ABOUT THE TRUSTEE......................................................... 25
LIMITATIONS ON LIABILITIES OF SPONSOR AND TRUSTEE..................................... 25
SUCCESSOR TRUSTEES AND SPONSORS....................................................... 25
INFORMATION ABOUT THE SPONSOR......................................................... 26
OTHER INFORMATION..................................................................... 27
</TABLE>
3
<PAGE>
NUVEEN UNIT TRUSTS
This Nuveen Unit Trust is one of a series of separate but similar investment
companies created by the Sponsor, each of which is designated by a different
Series number. The underlying unit investment trusts contained in this Series
are combined under one Trust Indenture and Agreement. Specific information
regarding each Trust is set forth in Part A of this Prospectus. The various
Nuveen Unit Trusts are collectively referred to herein as the "TRUSTS." This
Series was created under the laws of the State of New York pursuant to a Trust
Indenture and Agreement dated the Initial Date of Deposit (the "INDENTURE")
between John Nuveen & Co. Incorporated ("NUVEEN" or the "SPONSOR") and The Chase
Manhattan Bank (the "TRUSTEE").
The Sponsor has deposited with the Trustee delivery statements relating to
contracts for the purchase of common stocks of companies, selected by Nuveen
using a screening model developed by Nuveen with the assistance and expertise of
Standard & Poor's, together with funds represented by an irrevocable letter of
credit issued by a major commercial bank in the amount required for their
purchase (or the securities themselves) (the "SECURITIES"). See "SCHEDULE OF
INVESTMENTS" in Part A of this Prospectus, for a description of the Securities
deposited in a Trust. See also, "SUMMARY OF PORTFOLIOS" and "RISK FACTORS."
The Trustee has delivered to the Sponsor registered Units which represent
ownership of the entire Trust, and which are offered for sale by this
Prospectus. Each Unit of a Trust represents a fractional undivided interest in
the Securities deposited in such Trust in the ratio set forth in "ESSENTIAL
INFORMATION" in Part A of this Prospectus. Units may only be sold in states in
which they are registered. To the extent that any Units of any Trust are
redeemed by the Trustee, the aggregate value of the Trust's assets will decrease
by the amount paid to the redeeming Unitholder, but the fractional undivided
interest of each unredeemed Unit in such Trust will increase proportionately.
The Sponsor will initially, and from time to time thereafter, hold Units in
connection with their offering.
Additional Units of a Trust may be issued from time to time following the
Initial Date of Deposit by depositing in such Trust additional Securities (or
contracts therefore backed by an irrevocable letter of credit or cash) or cash
(including a letter of credit) with instructions to purchase additional
Securities in the Trust. As additional Units are issued by a Trust as a result
of the deposit of additional Securities or cash by the Sponsor, the aggregate
value of the Securities in a Trust will be increased and the fractional
undivided interest in such Trust represented by each Unit will be decreased. The
Sponsor may continue to make additional deposits of Securities, or cash with
instructions to purchase additional Securities, into a Trust following the
Initial Date of Deposit, provided that such additional deposits will be in
amounts which will maintain, within reasonable parameters, the same original
proportionate relationship among the Securities in such Trust established on the
Initial Date of Deposit. Thus, although additional Units will be issued, each
Unit will continue to represent the same proportionate amount of each Security.
To the extent that any Units are redeemed by the Trustee or additional Units are
issued as a result of additional Securities or cash being deposited by the
Sponsor, the fractional undivided interest in a Trust represented by each
unredeemed Unit will decrease or increase accordingly, although the actual
interest in such Trust represented by such fraction will remain unchanged. If
the Sponsor deposits cash, however, existing and new investors may experience a
dilution of their investment and a reduction in their anticipated income because
of fluctuations in the price of the Securities between the time of the cash
deposit and the purchase of the Securities and because the Trust will pay the
associated brokerage fees. To minimize this effect, the Trust will try to
purchase the Securities as close to the evaluation time or as close to the
evaluation price as possible. Units will remain outstanding until redeemed upon
tender to the Trustee by Unitholders, which may include the Sponsor, or until
termination of the Trust Agreement.
4
<PAGE>
OBJECTIVE OF THE TRUSTS
The objective of the Trust is to provide the potential for above average
capital appreciation with a moderated level of risk as compared to the S&P 500.
There is, of course, no guarantee that the Trust's objective will be achieved.
SUMMARY OF PORTFOLIOS
The Securities included in a Trust's portfolio were derived using the
following four-step screening model (the "QUALITY SCREENING MODEL") developed by
Nuveen with the assistance and expertise of Standard & Poor's. As an initial
step, only companies with market capitalizations equal to or in excess of $500
million were eligible for inclusion in a Trust. The second step selected only
those companies ranked A+ or A by Standard & Poor's Earnings and Dividend
Rankings for Common Stocks, its highest rankings. The third filter selected only
those companies which had a Standard & Poor's Senior Debt Rating of at least
AA-. As a final step, from this universe of companies only those companies whose
shares of common stock outstanding during the last year (as of the company's
most recent fiscal quarter for which information is available) declined by at
least 1% were selected for the Trust. See "PORTFOLIO."
COMPOSITION OF TRUSTS
Each Trust initially consists of delivery statements relating to contracts
to purchase Securities (or of such Securities) as are listed under "SCHEDULE OF
INVESTMENTS" in Part A of this Prospectus and, thereafter, of such Securities as
may continue to be held from time to time (including certain securities
deposited in the Trust to create additional Units or in substitution for
Securities not delivered to a Trust.)
LIMITED REPLACEMENT OF CERTAIN SECURITIES. Neither the Sponsor nor the
Trustee shall be liable in any way for any default, failure or defect in any
Security. In the event of a failure to deliver any Security that has been
purchased for a Trust under a contract, including those Securities purchased on
a when, as and if issued basis ("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 the Trust within 20
days after delivery of notice of the failed contract and the cost to the Trust
may not exceed the amount of funds reserved for the purchase of the Failed
Securities.
If the right of limited substitution described in the preceding paragraph is
not utilized to acquire Replacement Securities in the event of a failed
contract, the Sponsor will refund the sales charge attributable to such Failed
Securities to all Unitholders of the Trust and the Trustee will distribute the
principal attributable to such Failed Securities not more than 120 days after
the date on which the Trustee received a notice from the Sponsor that a
Replacement Security would not be deposited in the Trust. In addition,
Unitholders should be aware that, at the time of receipt of such principal, they
may not be able to reinvest such proceeds in other securities with equivalent
growth potential at a comparable price.
The indenture also authorizes the Sponsor to increase the size of the Trust
and the number of Units thereof by the deposit of additional Securities in the
Trust or cash (including a letter of credit) with instructions to purchase
additional Securities in the Trust and the issuance of a corresponding number of
additional Units. If the Sponsor deposits cash, however, existing and new
investors may experience a dilution of their investment and a reduction in their
anticipated income because of fluctuations in the prices of the Securities
between the time of the cash deposit and the purchase of the Securities and
because the Trust will pay the associated brokerage fees.
SALE OF SECURITIES. Certain of the Securities may from time to time under
certain circumstances be sold. The proceeds from such events will be used to pay
for Units redeemed or distributed to Unitholders and not
5
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reinvested; accordingly, no assurance can be given that a Trust will retain for
any length of time its present size and composition.
LITIGATION. To the best knowledge of the Sponsor, there is no litigation
pending as of the Initial Date of Deposit in respect of any Securities which
might reasonably be expected to have a material adverse effect on any of the
Trusts. It is possible that after the Initial Date of Deposit, litigation may be
initiated with respect to Securities in any Trust. The Sponsor is unable to
predict whether any such litigation may be instituted, or if instituted, whether
such litigation might have a material adverse effect on the Trusts.
PORTFOLIO
The Trust consists of common stocks of companies which were derived from the
Quality Screening Model as described under "SUMMARY OF PORTFOLIOS". The Quality
Screening Model was designed to select those companies capable of achieving the
Trust's objective of providing the potential for above average capital
appreciation with a moderated level of risk as compared to the S&P 500. The
Quality Screening Model was designed to create a universe of well-established,
large capitalization companies with above average equity rankings and debt
ratings. In this regard, the Quality Screening Model includes only those
companies with equity rankings of at least A (as evidenced by the Standard &
Poor's Earnings and Dividend Rankings for Common Stocks) and senior debt ratings
of at least AA- (as evidenced by the Standard & Poor's Corporate Rating
Criteria). See "Appendix A -- Standard & Poor's Earnings and Dividend Rankings
for Common Stocks" and "Appendix B -- Standard & Poor's Corporate Ratings
Criteria," both found in the Information Supplement. From that universe the
Quality Screening Model selected those companies which have reduced the number
of common shares outstanding by at least 1% over the last year (as of the
Company's most recent fiscal quarter for which information is available).
Standard & Poor's has indicated that it believes that the reduction of common
shares outstanding is typically the result of a share "buy back" program
executed by the company and generally reflects a companies strong cash flow
position, and in turn, high quality earnings and may provide an indirect measure
of the value of the stock. In many cases, the management of companies executing
share reduction strategies has judged that an investment in the company's own
stock offers more attractive returns than competing investment opportunities.
Contraction of shares outstanding is also typically associated with companies
that are more likely to be characterized as "stable" rather than "aggressive
growth." Companies seeking very rapid (and potentially volatile) growth are
unlikely to divert resources to share reduction activities. It is the Sponsor's
belief that highly rated, large capitalization companies engaging in such stock
repurchase programs offer the potential for above average capital appreciation.
There is, however, no assurance that the objectives of the Trust will be
achieved.
The following table compares the actual performance of the S&P 500 Composite
Stock Price Index (the "S&P 500") and the Dow Jones Industrial Average (the
"DJIA") with the hypothetical performance of approximately equal amounts
invested in common stocks selected by the Quality Screening Model (but not a
Trust) in each of the 15 years listed below, as of the business day prior to the
beginning of each year.
The returns shown in the following table and graph are not guarantees of
future performance and should not be used as a predictor of returns to be
expected in connection with a Trust. The common stocks selected by the Quality
Screening Model underperformed the S&P 500 and/or the DJIA in certain years.
Accordingly, there can be no assurance that a Trust's portfolio will outperform
the S&P 500 or the DJIA over the life of a Trust or over consecutive rollover
periods, if available.
A holder of Units in a Trust would not necessarily realize as high a Total
Return on an investment in stocks upon which the hypothetical returns are based
for the following reasons: the Total Return figures shown do not reflect sales
charges, commissions, Trust expenses or taxes; the Trust is established at
different times of the year; the Trust may not be fully invested at all times or
equally weighted in all stocks selected by
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the Quality Screening Model; and Securities are often purchased or sold at
prices different from the closing prices used in buying and selling Units.
COMPARISON OF TOTAL RETURN(2)
<TABLE>
<CAPTION>
HYPOTHETICAL QUALITY
SCREENING MODEL TOTAL S&P 500 DJIA
YEAR RETURNS(1) TOTAL RETURNS TOTAL RETURNS
- ------------------------------------------ --------------------- ------------- -------------
<S> <C> <C> <C>
1982...................................... 23.24% 21.44% 25.84%
1983...................................... 38.52% 22.38% 25.68%
1984...................................... 20.15% 6.10% 1.07%
1985...................................... 34.42% 31.57% 32.83%
1986...................................... 31.82% 18.56% 26.96%
1987...................................... 11.60% 5.10% 6.00%
1988...................................... 26.91% 16.61% 15.97%
1989...................................... 31.40% 31.69% 31.74%
1990...................................... 4.12% -3.10% -0.61%
1991...................................... 29.66% 30.47% 23.99%
1992...................................... 14.22% 7.62% 7.37%
1993...................................... 0.14% 10.08% 16.74%
1994...................................... 8.93% 1.32% 4.94%
1995...................................... 35.56% 37.58% 36.47%
1996...................................... 19.10% 22.96% 28.80%
1997 (through 3/31)....................... 2.53% 2.68% 2.63%
</TABLE>
- ------------------------
(1) The Quality Screening Model common stocks for any given period were selected
by applying the Quality Screening Model as of the beginning of the period.
The Quality Screening Model may include commonstocks included in the S&P 500
and/or the DJIA.
(2) Total Return represents the change in market price for the calendar year
plus dividends, divided by the initial price, for each group of stocks.
Total Return does not take into consideration reinvestment of dividends for
the Quality Screening Model or the DJIA. The Total Return for the S&P 500
assumes dividends are reinvested as they are received. Total Return does not
take into consideration any sales charges, commissions, expenses or taxes.
Based on the year-by-year returns contained in the table, over the 15 years
listed above, the Quality Screening Model common stocks achieved an average
total return of 21.41% while the S&P 500 and the DJIA achieved an average
annual total return of 16.74% and 18.30%, respectively. Although the Trust
seeks to achieve a better performance than the S&P 500 and the DJIA, there
can be no assurance that the Trust will achieve a better performance over
its one-year life or over consecutive rollover periods, if available.
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SUPPOSE YOU HAD INVESTED $10,000 ON JANUARY 1, 1982?
The chart that appears here represents the cumulative growth of $10,000
invested in the stocks which comprise the Quality Screening Model, the DJIA and
the S&P 500 on January 1, 1982 through March 31, 1997. Specifically, the chart
shows that a $10,000 investment in the stocks which comprise the Quality
Screening Method, the DJIA and the S&P 500 (reweighted annually) would have
appreciated to $188,330, $127,656 and $104,643, respectively, as of March 31,
1997.
[LOGO]
The chart above represents past performance of the Quality Screening Model
(but not the Trust), the S&P 500 and the DJIA from January 1, 1982 through March
31, 1997 and should not be considered indicative of future results. Further,
these results are hypothetical. The chart assumes that all dividends are
reinvested and does not reflect sales charges, commission, expenses or taxes.
The returns for the Quality Screening Model reflect the adjustment of the
Quality Screening Model at the beginning of each year in accordance with the
Quality Screening Model and they do not indicate the actual performance of any
investment product. There can be no assurance that the Trust will outperform the
S&P 500 or the DJIA over its one-year life or over consecutive rollover periods,
if available.
RISK FACTORS
An investment in Units should be made with an understanding of the risks
which an investment in common stocks entails, including the risk that the
financial condition of the issuers of the Securities or the general conditions
of the common stock market may worsen and the value of the Securities and
therefore the value of the Units may decline. Common stocks are especially
susceptible to general stock market movements and to volatile increases and
decreases of value as market confidence in and perceptions of the issuers
change. These perceptions are based on unpredictable factors including
expectations regarding government, economic, monetary and fiscal policies,
inflation and interest rates, economic expansion or contraction, and global or
regional political, economic or banking crises. Shareholders of common stocks
have rights to receive payments from the issuers of those common stocks that are
generally subordinate to those of
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creditors of, or holders of debt obligations or preferred stocks of, such
issuers. Shareholders of common stocks of the type held by the Trusts have a
right to received dividends only when and if, and in the amounts, declared by
the issuer's board of directors and have a right to participate in amounts
available for distribution by the issuer only after all other claims on the
issuer have been paid or provided for. Common stocks do not represent an
obligations of the issuer and, therefore, do not offer any assurance of income
or provide the same degree of protection of capital as do debt securities. The
issuance of additional debt securities or preferred stock will create prior
claims for payment of principal, interest and dividends which could adversely
affect the ability and inclination of the issuer to declare or pay dividends on
its common stock or the rights of holders of common stock with respect to assets
of the issuer upon liquidation or bankruptcy. The value of common stocks is
subject to market fluctuations for as long as the common stocks remain
outstanding, and thus the value of the Securities in the Trusts may be expected
to fluctuate over the life of the Trusts to values higher or lower than those
prevailing on the Initial Date of Deposit.
Holders of common stocks incur more risk than holders of preferred stocks
and debt obligations because common stockholders, as owners of the entity, have
generally inferior rights to receive payments from the issuer in comparison with
the rights of creditors of, or holders of debt obligations or preferred stocks
issued by, the issuer. Cumulative preferred stock dividends must be paid before
common stock dividends and any cumulative preferred stock dividend omitted is
added to future dividends payable to the holders of cumulative preferred stock.
Preferred stockholders are also generally entitled to rights on liquidation
which are senior to those of common stockholders.
Unitholders will be unable to dispose of any of the Securities in the Trust,
as such, and will not be able to vote the Securities. As the holder of the
Securities, the Trustee will have the right to vote all of the voting stocks in
a Trust and will vote such stocks in accordance with the instructions of the
Sponsor.
The value of the Securities will fluctuate over the life of a Trust and may
be more or less than the value at the time they were deposited in such Trust.
The Securities may appreciate or depreciate in value (or pay dividends)
depending on the full range of economic and market influences affecting these
securities, including the impact of the Sponsor's purchase and sale of
Securities (especially during the primary offering period of Units of a Trust
and during the Special Redemption and Liquidation Period) and other factors.
Whether or not the Securities are listed on a securities exchange, the
principal trading market for the Securities may be in the over-the-counter
market. As a result, the existence of a liquid trading market for the Securities
may depend on whether dealers will make a market in the Securities. There can be
no assurance that a market will be made for any of the Securities, that any
market for the Securities will be maintained or of the liquidity of the
Securities in any markets made. In addition, the Trusts may be restricted under
the Investment Company Act of 1940 from selling Securities to the Sponsor. The
price at which the Securities may be sold to meet redemptions and the value of
the Trusts will be adversely affected if trading markets for the Securities are
limited or absent.
PUBLIC OFFERING PRICE
The Public Offering Price of the Units is based on the aggregate underlying
value of the Securities in the Trust (generally determined by the closing sale
prices of listed Securities and the ask prices of over-the-counter traded
Securities), plus or minus cash, if any, in the Income and Capital Accounts of
the Trust, plus an initial sales charge equal to the difference between the
maximum sales charge of 2.75% of the Public Offering Price per Unit and the
maximum remaining deferred sales charge, initially $0.175 per Unit. Commencing
on those dates set forth under "INVESTING IN THE TRUST -- SALES CHARGES" in Part
A of this Prospectus, a deferred sales charge of $0.0175 will be assessed per
Unit per month. Units purchased subsequent to the initial deferred sales charge
payment will be subject to the initial sales charge and the remaining deferred
sales charge payments not yet collected. The deferred sales charge will be paid
from funds in the Capital Account,
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<PAGE>
if sufficient, or from the periodic sale of Securities. A pro rata share of
accumulated dividends, if any, in the Income Account from the preceeding Record
Date to, but not including, the settlement date (normally three business days
after purchase) is added to the Public Offering Price. The total maximum sales
charge assessed to Unitholders on a per Unit basis will be 2.75% of the Public
Offering Price (equivalent to 2.778% of the net amount invested, exclusive of
the deferred sales charge). See "UNIT VALUE AND EVALUATION."
The sales charge applicable to quantity purchases is reduced on a graduated
scale as set forth in Part A of this Prospectus. For purposes of calculating the
applicable sales charge, purchasers who have indicated their intent to purchase
a specified amount of Units of any Trust in the primary or secondary offering
period by executing and delivering a letter of intent to the Sponsor, which
letter of intent must be in a form acceptable to the Sponsor and shall have a
maximum duration of thirteen months, will be eligible to receive a reduced sales
charge according to the graduated scale provided in Part A of this Prospectus,
based on the amount of intended aggregate purchases (excluding purchases which
are subject only to a deferred sales charge) as expressed in the letter of
intent. For purposes of letter of intent calculations units of equity products
are valued at $10 per unit. Due to administrative limitations and in order to
permit adequate tracking, the only secondary market purchases that will be
permitted to be applied toward the intended specified amount and that will
receive the corresponding reduced sales charge are those Units that are acquired
through or from the Sponsor. By establishing a letter of intent, a Unitholder
agrees that the first purchase of Units following the execution of such letter
of intent will be at least 5% of the total amount of the intended aggregate
purchases expressed in such Unitholders letter of intent. Further, through the
establishment of the letter of intent, such Unitholder agrees that Units
representing 5% of the total amount of the intended purchases will be held in
escrow by the Trustee pending completion of these purchases. All distributions
on Units held in escrow will be credited to such Unitholders account. If total
purchases prior to the expiration of the letter of intent period equal or exceed
the amount specified in a Unitholder's letter of intent, the Units held in
escrow will be transferred to such Unitholder's account. A Unitholder who
purchases Units during the letter of intent period in excess of the number of
Units specified in a Unitholder's letter of intent, the amount of which would
cause the Unitholder to be eligible to receive an additional sales charge
reduction, will be allowed such additional sales charge reduction on the
purchase of Units which caused the Unitholder to reach such new breakpoint level
and on all additional purchases of Units during the letter of intent period. If
the total purchases are less than the amount specified, the Unitholder involved
must pay the Sponsor an amount equal to the difference between the amounts paid
for these purchases and the amounts which would have been paid if the higher
sales charge had been applied; the Unitholder will, however, be entitled to any
reduced sales charge qualified for by reaching any lower breakpoint level. If
such Unitholder does not pay the additional amount within 20 days after written
request by the Sponsor or the Unitholder's securities representative, the
Sponsor will instruct the Trustee to redeem an appropriate number of the
escrowed Units to meet the required payment. By establishing a letter of intent,
a Unitholder irrevocably appoints the Sponsor as attorney to give instructions
to redeem any or all of such Unitholder's escrowed Units, with full power of
substitution in the premises. A Unitholder or his securities representative must
notify the Sponsor whenever such Unitholder makes a purchase of Units that he
wishes to be counted towards the intended amount.
For "secondary market" sales the Public Offering Price per Unit of each
Trust is determined by adding to the Trustees determination of the aggregate
value of each Security in the Trust (generally determined by the closing sale
prices of listed Securities and the bid prices of over-the-counter traded
Securities) a sales charge as set forth in Part A of this Prospectus. See "UNIT
VALUE AND EVALUATION." The secondary market sales charge is reduced with respect
to quantity purchases in such amounts set forth in Part A of this Prospectus.
Pursuant to the terms of the Indenture, the Trustee may terminate a Trust if
the net asset value of such Trust, as shown by any evaluation, is less than 20%
of the total value of the Securities deposited in the Trust during the primary
offering period of the Trust.
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At all times while Units are being offered for sale, the Sponsor will
appraise or cause to be appraised daily the value of the underlying Securities
in each Trust as of 4:00 p.m. eastern time, or as of any earlier closing time on
a day on which the New York Stock Exchange (the "EXCHANGE") is scheduled in
advance to close at such earlier time and will adjust the Public Offering Price
of the Units commensurate with such appraisal. Such Public Offering Price will
be effective for all orders received by a dealer or the Sponsor at or prior to
4:00 p.m. eastern time on each such day or as of any earlier closing time on a
day on which the Exchange is scheduled in advance to close at such earlier time.
Orders received after that time, or on a day when the Exchange is closed for a
scheduled holiday or weekend, will be held until the next determination of
price.
The graduated sales charges set forth in the table provided in Part A of
this Prospectus will apply on all applicable purchases of Nuveen investment
company securities on any one day by the same purchaser in the amounts stated,
and for this purpose purchases of this Series will be aggregated with concurrent
purchases of any other Series or of shares of any open-end management investment
company of which the Sponsor is principal underwriter and with respect to the
purchase of which a sales charge is imposed. Purchases by or for the account of
individuals and their spouses, parents, children, grandchildren, grandparents,
parents-in-law, sons- and daughters-in-law, siblings, a sibling's spouse and a
spouse's siblings ("immediate family members") will be aggregated to determine
the applicable sales charge. The graduated sales charges are also applicable to
a trustee or other fiduciary purchasing securities for a single trust estate or
single fiduciary account. Units may be purchased at the Public Offering Price
without a sales charge by officers or directors and by bona fide, full-time
employees of Nuveen, Nuveen Advisory Corp., Nuveen Institutional Advisory Corp.,
The John Nuveen Company and The McGraw-Hill Companies, Inc., including in each
case these individuals and their immediate family members (as defined above).
Unitholders of other unit investment trusts having a similar strategy as the
Trust may utilize their termination proceeds to purchase Units of the Trust,
subject only to the deferred sales charge set forth in Part A of this
Prospectus. The dealer concession will be that applicable to rollovers.
Units may be purchased with sales charges of 0.65% of the Public Offering
Price by (1) investors who purchase Units through registered investment
advisers, certified financial planners and registered broker-dealers who in each
case either 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, (2) bank trust departments investing funds over which they
exercise exclusive discretionary investment authority and that are held in a
fiduciary, agency, custodial or similar capacity, (3) any person who for at
least 90 days, has been an officer, director or bona fide employee of any firm
offering Units for sale to investors or their immediate family members (as
defined above) and (4) officers and directors of bank holding companies that
make Units available directly or through subsidiaries or bank affiliates
(collectively, the "DISCOUNTED PURCHASES"). Notwithstanding anything to the
contrary in this Prospectus, investors who purchase Units as described in this
paragraph will not receive sales charge reductions for quantity purchases.
Whether or not Units are being offered for sale, the Sponsor will determine
the aggregate value of each Trust as of 4:00 p.m. eastern time: (i) on each June
30 or December 31 (or, if such date is not a business day, the last business day
prior thereto), (ii) on any day on which a Unit is tendered for redemption (or
the next succeeding business day if the date of tender is a non-business day)
and (iii) at such other times as may be necessary. For this purpose, a "business
day" shall be any day on which the Exchange is normally open. (See "UNIT VALUE
AND EVALUATION.")
MARKET FOR UNITS
During the initial public offering period, the Sponsor intends to offer to
purchase Units of each Trust at a price based upon the pro rata share per Unit
of the aggregate underlying value of the Securities in such Trust (generally
determined by the closing sale prices of listed Securities and the ask prices of
over-the-counter
11
<PAGE>
traded Securities). Afterward, although it is not obligated to do so, the
Sponsor may maintain a secondary market for Units of each Trust at its own
expense and continuously to offer to purchase Units of each Trust at prices,
subject to change at any time, which are based upon the aggregate underlying
value of the Securities in a Trust (generally determined by the closing sale
prices of listed Securities and the bid prices of over-the-counter traded
Securities). UNITHOLDERS WHO WISH TO DISPOSE OF THEIR UNITS SHOULD INQUIRE OF
THE TRUSTEE OR THEIR BROKER AS TO THE CURRENT REDEMPTION PRICE. Units subject to
a deferred sales charge which are sold or tendered for redemption prior to such
time as the entire deferred sales charge on such Units has been collected will
be assessed the amount of the remaining deferred sales charge at the time of
sale or redemption. (See "REDEMPTION.") In connection with its secondary market
making activities, the Sponsor may from time to time enter into secondary market
joint account agreements with other brokers and dealers. Pursuant to such an
agreement, the Sponsor will purchase Units from the broker or dealer at the bid
price and will place the Units into a joint account managed by the Sponsor;
sales from the account will be made in accordance with the then current
prospectus and the Sponsor and the broker or dealer will share profits and
losses in the joint account in accordance with the terms of their joint account
agreement.
Certificates, if any, for Units are delivered to the purchaser as promptly
after the date of settlement (three business days after purchase) as the Trustee
can complete the mechanics of registration, normally within 48 hours after
registration instructions are received. Purchasers of Units to whom Certificates
are issued will be unable to exercise any right of redemption until they have
received their Certificates, properly endorsed for transfer. (See "REDEMPTION.")
EVALUATION OF SECURITIES AT THE INITIAL DATE OF DEPOSIT
The prices at which the Securities deposited in the Trusts would have been
offered to the public on the business day prior to the Initial Date of Deposit
were determined by the Trustee.
The amount by which the Trustee's determination of the AGGREGATE VALUE of
the Securities deposited in the Trusts was greater or less than the cost of such
Securities to the Sponsor was PROFIT or LOSS to the Sponsor. (See Part A of this
Prospectus.) The Sponsor also may realize FURTHER PROFIT OR SUSTAIN FURTHER LOSS
as a result of fluctuations in the Public Offering Price of the Units. Cash, if
any, made available to the Sponsor prior to the settlement date for a purchase
of Units, or prior to the acquisition of all Portfolio securities by a Trust,
may be available for use in the Sponsor's business, and may be of benefit to the
Sponsor.
TAX STATUS
The following is a general discussion of certain of the Federal income tax
consequences of the purchase, ownership and disposition of the Units. The
summary is limited to investors who hold the Units as "capital assets"
(generally, property held for investment) within the meaning of Section 1221 of
the Internal Revenue Code of 1986 (the "CODE"). Unitholders should consult their
tax advisers in determining the Federal, state, local and any other tax
consequences of the purchase, ownership and disposition of Units in a Trust. For
purposes of the following discussions and opinions, it is assumed that each
Security is equity for Federal income tax purposes.
In the opinion of Chapman and Cutler, special counsel for the Sponsor, under
existing law:
1. The Trust is not an association taxable as a corporation for Federal
income tax purposes; each Unitholder will be treated as the owner of a pro
rata portion of the assets of the Trust under the Code; and the income of
the Trust will be treated as income of the Unitholders thereof under the
Code. Each Unitholder will be considered to have received all of the
dividends paid on his pro rata portion of each Security when such dividends
are received by the Trust regardless of whether such dividends are used to
pay a portion of the deferred sales charge. Unitholders will be taxed in
this manner regardless of
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whether distributions from the Trust are actually received by the Unitholder
or are automatically reinvested.
2. Each Unitholder will have a taxable event when the Trust disposes of
a Security (whether by sale, taxable exchange, liquidation, redemption, or
otherwise) or upon the sale or redemption of Units by such Unitholder
(except to the extent an in-kind distribution of stocks is received by such
Unitholder as described below). The price a Unitholder pays for his or her
Units, generally including sales charges, is allocated among his or her pro
rata portion of each Security held by the Trust (in proportion to the fair
market values thereof on the validation date closest to the date the
Unitholder purchases his or her Units) in order to determine his or her tax
basis for his or her pro rata portion of each Security held by the Trust. It
should be noted that certain legislative proposals have been made which
could affect the calculation of basis for Unitholders holding securities
that are substantially identical to the Securities. Unitholder should
consult their own tax advisors with regard to the calculation of basis. For
Federal income tax purposes, a Unitholder's pro rata portion of dividends,
as defined by Section 316 of the Code, paid by a corporation with respect to
a Security held by the Trust is taxable as ordinary income to the extent of
such corporation's current and accumulated "earnings and profits." A
Unitholder's pro rata portion of dividends paid on such Security which
exceeds such current and accumulated earnings and profits will first reduce
a Unitholder's tax basis in such Security, and to the extent that such
dividends exceed a Unitholder's tax basis in such Security shall generally
be treated as capital gain. In general, any such capital gain will be
short-term unless a Unitholder has held his or her Units for more than one
year.
3. A Unitholder's portion of gain, if any, upon the sale or redemption
of Units or the disposition of Securities held by a Trust will generally be
considered a capital gain (except in the case of a dealer or a financial
institution) and, in general, will be long-term if the Unitholder has held
his or her Units for more than one year (the date on which the Units are
acquired (I.E., the "TRADE DATE") is excluded for purposes of determining
whether the Units have been held for more than one year). A Unitholder's
portion of loss, if any, upon the sale or redemption of Units or the
disposition of Securities held by the Trust will generally be considered a
capital loss (except in the case of a dealer or a financial institution)
and, in general, will be long-term if the Unitholder has held his or her
Units for more than one year. Unitholders should consult their tax advisors
regarding the recognition of such capital gains and losses for Federal
income tax purposes. In particular, a Rollover Unitholder should be aware
that a Rollover Unitholder's loss, if any, incurred in connection with the
exchange of Units for units in the next new series of the Trust (the "NEW
TRUST"), (the Sponsor intends to create a separate New Trust in conjunction
with the termination of the Trust) will generally be disallowed with respect
to the disposition of any Securities pursuant to such exchange to the extent
that such Unitholder is considered the owner of substantially identical
securities under the wash sale provisions of the Code taking into account
such Unitholder's deemed ownership of the securities underlying the Units in
the New Trust in the manner described above, if such substantially identical
securities were acquired within a period beginning 30 days before and ending
30 days after such disposition. However, any gains incurred in connection
with such an exchange by a Rollover Unitholder would be recognized.
DEFERRED SALES CHARGE. Generally, the tax basis of a Unitholder includes
sales charges, and such charges are not deductible. A portion of the sales
charge is deferred. It is possible that for federal income tax purposes, a
portion of the deferred sales charge may be treated as interest which would be
deductible by a Unitholder subject to limitations on the deduction of investment
interest. In such case, the non-interest portion of the deferred sales charge
would be added to the Unitholder's tax basis in his or her Units. The deferred
sales charge could cause the Unitholder's Units to be considered to be
debt-financed under Section 264A of the Code which would result in a small
reduction of the dividends received deduction. In any case, the income (or
proceeds from redemption) a Unitholder must take into account for federal income
tax
13
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purposes is not reduced by amounts deducted to pay the deferred sales charge.
Unitholders should consult their own tax advisers as to the income tax
consequences of the deferred sales charge.
DIVIDENDS RECEIVED DEDUCTION.__A corporation that owns Units will generally
be entitled to a 70% dividends received deduction with respect to such
Unitholder's pro rata portion of dividends received by the Trust (to the extent
such dividends are taxable as ordinary income, as discussed above and are
attributable to domestic corporations) in the same manner as if such corporation
directly owned the Securities paying such dividends (other than corporate
Unitholders, such as "S" corporations, which are not eligible for the deduction
because of their special characteristics and other than for purposes of special
taxes such as the accumulated earnings tax and the personal holding corporation
tax). However, a corporation owning Units should be aware that Sections 246 and
246A of the Code impose additional limitations on the eligibility of dividends
for the 70% dividends received deduction, These limitations include a
requirement that stock (and therefore Units) must generally be held at least 46
days (as determined under Section 246(c) of the Code). Final regulations have
recently been issued which address special rules that must be considered in
determining whether the 46-day holding period requirement is met. Moreover, the
allowable percentage of the deduction will be reduced from 70% if a corporate
Unitholder owns certain stock (or Units) the financing of which is directly
attributable to indebtedness incurred by such corporation. It should be noted
that various legislative proposals that would affect the dividends received
deduction have been introduced. Unitholders should consult with their tax
advisers with respect to the limitations on and possible modifications to the
dividends received deduction.
LIMITATIONS ON DEDUCTIBILITY OF TRUST EXPENSES BY UNITHOLDERS. Each
Unitholder's pro rata share of each expense paid by the Trust is deductible by
the Unitholder to the same extent as though the expense had been paid directly
by him or her. It should be noted that as a result of the Tax Reform Act of
1986, certain miscellaneous itemized deductions, such as investment expenses,
tax return preparation fees and employee business expenses will be deductible by
an individual only to the extent they exceed 2% of such individual's adjusted
gross income. Unitholder's may be required to treat some or all of the expenses
of the Trust as miscellaneous itemized deductions subject to this limitation.
RECOGNITION OF TAXABLE GAIN OR LOSS UPON DISPOSITION OF SECURITIES BY A
TRUST OR DISPOSITION OF UNITS. As discussed above, a Unitholder may recognize
taxable gain (or loss) when a Security is disposed of by the Trust or if the
Unitholder disposes of a Unit (although losses incurred by Rollover Unitholders
may be subject to disallowance, as discussed above). For taxpayers other than
corporations, net capital gains (which is defined as net long-term capital gain
over net short-term capital loss for a taxable year) are subject to a maximum
stated marginal tax rate of 28%. However, it should be noted that legislative
proposals are introduced from time to time that affect tax rates and could
affect relative differences at which ordinary income and capital gains are
taxed.
"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. Unitholders and prospective
investors should consult with their tax advisers regarding the potential effect
of this provision on their investment in Units.
If the Unitholder disposes of a Unit, he or she is deemed thereby to have
disposed of his or her entire pro rata interest in all assets of the Trust
including his or her pro rata portion of all the Securities represented by the
Unit. Legislative proposals have been made that would treat certain transactions
designed to reduce or eliminate risk of loss and opportunities for gain as
constructive sales for purposes of recognition of gain (but not loss).
Unitholders should consult their own tax advisors with regard to any such
constructive sales rules.
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SPECIAL TAX CONSEQUENCES OF IN-KIND DISTRIBUTIONS UPON REDEMPTION OF UNITS,
TERMINATION OF A TRUST AND INVESTMENT IN A NEW TRUST. As discussed in
"REDEMPTION" and "OTHER INFORMATION -- TERMINATION OF INDENTURE," under certain
circumstances a Unitholder who owns at least 2,500 Units of a Trust may request
an In-Kind Distribution upon the redemption of Units or the termination of such
Trust. The Unitholder requesting an In-Kind Distribution will be liable for
expenses related thereto (the "DISTRIBUTION EXPENSES") and the amount of such
In-Kind Distribution will be reduced by the amount of the Distribution Expenses.
See "DISTRIBUTIONS TO UNITHOLDERS." As previously discussed, prior to the
redemption of Units or the termination of a Trust, a Unitholder is considered as
owning a pro rata portion of each of the Trust's assets for Federal income tax
purposes. The receipt of an In-Kind Distribution upon the redemption of Units or
the termination of a Trust will result in a Unitholder receiving an undivided
interest in whole shares of stock plus, possibly, cash.
The potential tax consequences that may occur under an In-Kind Distribution
will depend on whether or not a Unitholder receives cash in addition to
Securities. A "Security" for this purpose is a particular class of stock issued
by a particular corporation. A Unitholder will not recognize gain or loss if a
Unitholder only receives Securities in exchange for his or her pro rata portion
in the Securities held by the Trust. However, if a Unitholder also receives cash
in exchange for a fractional share of a Security held by the Trust, such
Unitholder will generally recognize gain or loss based upon the difference
between the amount of cash received by the Unitholder and his or her tax basis
in such fractional share of a Security held by the Trust.
Because the Trust will own many Securities, a Unitholder who requests an
In-Kind Distribution will have to analyze the tax consequences with respect to
each Security owned by the Trust. The amount of taxable gain (or loss)
recognized upon such exchange will generally equal the sum of the gain (or loss)
recognized under the rules described above by such Unitholder with respect to
each Security owned by the Trust. Unitholders who request an In-Kind
Distribution are advised to consult their tax advisers in this regard.
As discussed in "SPECIAL REDEMPTION, LIQUIDATION AND INVESTMENT IN A NEW
TRUST," a Unitholder may elect to become a Rollover Unitholder. To the extent a
Rollover Unitholder exchanges his or her Units for Units of the New Trust in a
taxable transaction, such Unitholder will recognize gains, if any, but generally
will not be entitled to a deduction for any losses recognized upon the
disposition of any Securities pursuant to such exchange to the extent that such
Unitholder is considered the owner of substantially identical securities under
the wash sale provisions of the Code taking into account such Unitholder's
deemed ownership of the securities underlying the Units in the New Trust in the
manner described above, if such substantially identical securities were acquired
within a period beginning 30 days before and ending 30 days after such
disposition under the wash sale provisions contained in Section 1091 of the
Code. In the event a loss is disallowed under the wash sale provisions, special
rules contained in Section 1091(d) of the Code apply to determine the
Unitholder's tax basis in the securities acquired. Rollover Unitholders are
advised to consult their tax advisers.
COMPUTATION OF THE UNITHOLDER'S TAX BASIS. Initially, a Unitholder's tax
basis in his or her Units will generally equal the price paid by such Unitholder
for his or her Units. The cost of the Units is allocated among the Securities
held in the Trust in accordance with the proportion of the fair market values of
such Securities on the valuation date nearest the date the Units are purchased
in order to determine such Unitholder's tax basis for his or her pro rata
portion of each Security.
A Unitholder's tax basis in his or her Units and his or her pro rata portion
of a Security held by the Trust will be reduced to the extent dividends paid
with respect to such Security are received by the Trust which are not taxable as
ordinary income as described above.
GENERAL. Each Unitholder will be requested to provide the Unitholder's
taxpayer identification number to the Trustee and to certify that the Unitholder
has not been notified that payments to the Unitholder
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are subject to back-up withholding. If the proper taxpayer identification number
and appropriate certification are not provided when requested, distributions by
the Trust to such Unitholder (including amounts received upon the redemption of
Units) will be subject to back-up withholding. Distributions by the Trust (other
than those that are not treated as United States source income, if any) will
generally be subject to United States income taxation and withholding in the
case of Units held by non-resident alien individuals, foreign corporations or
other non-United States persons. Such persons should consult their tax advisers.
At the termination of the Trust, the Trustee will furnish to each Unitholder
a statement containing information relating to the dividends received by the
Trust on the Securities, the gross proceeds received by the Trust from the
disposition of any Security (resulting from redemption or the sale of any
Security) and the fees and expenses paid by the Trust. The Trustee will also
furnish annual information returns to Unitholders and the Internal Revenue
Service.
Unitholders desiring to purchase Units for tax-deferred plans and IRAs
should consult their broker for details on establishing such accounts. Units may
also be purchased by persons who already have self-directed plans established.
See "RETIREMENT PLANS."
The foregoing discussion relates only to the tax treatment of U.S.
Unitholders ("U.S. Unitholder") with regard to federal and certain aspects of
New York State and City income taxes. Unitholders may be subject to taxation in
New York or in other jurisdictions and should consult their own tax advisers in
this regard. As used herein, the term "U.S. Unitholder" means an owner of a Unit
in the Trust that (a) is (i) for United States federal income tax purposes a
citizen or resident of the United States, (ii) a corporation, partnership or
other entity created or organized in or under the laws of the United States or
of any political subdivision thereof, or (iii) an estate or trust the income of
which is subject to United States federal income taxation regardless of its
source or (b) does not qualify as a U.S. Unitholder in paragraph (a) but whose
income from a Unit is effectively connected with such Unitholder's conduct of a
United States trade or business. The term also includes certain former citizens
of the United States whose income and gain on the units will be taxable.
In the opinion of Carter, Ledyard & Milburn, Special Counsel to the Trusts
for New York tax matters, under the existing income tax laws of the State of New
York, each Trust is not an association taxable as a corporation and the income
of each Trust will be treated as the income of the Unitholders thereof.
RETIREMENT PLANS
Units of the Trusts 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 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. Fees
and charges with respect to such plans may vary.
TRUST OPERATING EXPENSES
No annual advisory fee is charged to the Trusts by the Sponsor. Estimated
annual Trust expenses are as set forth in Part A of this Prospectus; if actual
expenses are higher than the estimate, the excess will be borne by the Trust.
The estimated expenses do not include the brokerage commissions payable by the
Trust in purchasing and selling Securities. Standard & Poor's receives an annual
fee from the Trust to cover licenses for the use of trademarks and trade names,
as well as for the license to the Sponsor for the use of databases used in
connection with the selection of stocks for the Trust.
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The Trustee receives for ordinary recurring services an annual fee for each
Trust as set forth in "EXPENSE INFORMATION" appearing in Part A of this
Prospectus. The Trustee's fee may be periodically adjusted in response to
fluctuations in short-term interest rates (reflecting the cost to the Trustee of
advancing funds to a Trust to meet scheduled distributions) and may be further
adjusted in accordance with the cumulative percentage increase of the United
States Department of Labor's Consumer Price Index entitled "All Services Less
Rent of Shelter" since the establishment of the Trusts. The Trustee has the use
of funds, if any, being held in the Income and Capital Accounts of each Trust
for future distributions, payment of expenses and redemptions. These Accounts
are non-interest bearing to Unitholders. Pursuant to normal banking procedures,
the Trustee benefits from the use of funds held therein. Part of the Trustee's
compensation for its services to the Trusts is expected to result from such use
of these funds.
All or a portion of the expenses incurred in establishing the Trusts,
including costs of preparing the registration statement, the trust indenture and
other closing documents, registering Units with the Securities and Exchange
Commission and states, the initial audit of each Trust portfolio, the initial
evaluation, legal fees, the initial fees and expenses of the Trustee and any
other non-material out-of-pocket expenses, will be amortized and paid by the
Trust over the first 12 months of the Trust. The following are additional
expenses of the Trusts and, when paid by or are owed to the Trustee, are secured
by a lien on the assets of the Trust or Trusts to which such expenses are
allocable: (1) the expenses and costs of any action undertaken by the Trustee to
protect the Trusts and the rights and interests of the Unitholders; (2) all
taxes and other governmental charges upon the Securities or any part of the
Trusts (no such taxes or charges are being levied or made or, to the knowledge
of the Sponsor, contemplated); (3) amounts payable to the Trustee as fees for
ordinary recurring services and for extraordinary non-recurring services
rendered pursuant to the Indenture, all disbursements and expenses including
counsel fees (including fees of counsel which the Trustee may retain) sustained
or incurred by the Trustee in connection therewith; and (4) any losses or
liabilities accruing to the Trustee without negligence, bad faith or willful
misconduct on its part. The Trustee is empowered to sell Securities in order to
pay these amounts if funds are not otherwise available in the applicable Income
and Capital Accounts.
DISTRIBUTIONS TO UNITHOLDERS
The Trustee will distribute any net income received with respect to any of
the Securities in a Trust on or about the Income Distribution Dates to
Unitholders of record on the preceding Income Record Date. See "DISTRIBUTIONS"
in Part A of this Prospectus. Persons who purchase Units will commence receiving
distributions only after such person becomes a Record Owner. Notification to the
Trustee of the transfer of Units is the responsibility of the purchaser, but in
the normal course of business such notice is provided by the selling
broker/dealer. Proceeds received on the sale of any Securities in a Trust, to
the extent not used to meet redemptions of Units, pay the deferred sales charge
or pay expenses, will, however, be distributed on the last day of each month to
Unitholders of record on the fifteenth day of each month if the amount available
for distribution equals at least $1.00 per 100 Units. The Trustee is not
required to pay interest on funds held in the Capital Account of a Trust (but
may itself earn interest thereon and therefore benefit from the use of such
funds). Notwithstanding, distributions of funds in the Capital Account, if any,
will be made as part of the final liquidation distribution, and in certain
circumstances, earlier. See "Tax Status."
It is anticipated that the deferred sales charge will be collected from the
Capital Account of the Trusts and that amounts in the Capital Account will be
sufficient to cover the cost of the deferred sales charge. To the extent that
amounts in the Capital Account are insufficient to satisfy the then current
deferred sales charge obligation, Securities may be sold to meet such shortfall.
Distributions of amounts necessary to pay the deferred portion of the sales
charge will be made to an account designated by the Sponsor for purposes of
satisfying Unitholder's deferred sales charge obligations.
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Under regulations issued by the Internal Revenue Service, the Trustee is
required to withhold a specified percentage of any distribution made by a Trust
if the Trustee has not been furnished the Unitholder's tax identification number
in the manner required by such regulations. Any amount so withheld is
transmitted to the Internal Revenue Service and may be recovered by the
Unitholder under certain circumstances by contacting the Trustee, otherwise the
amount may be recoverable only when filing a tax return. Under normal
circumstances the Trustee obtains the Unitholder's tax identification number
from the selling broker. However, a Unitholder should examine his or her
statements from the Trustee to make sure that the Trustee has been provided a
certified tax identification number in order to avoid this possible "back-up
withholding." In the event the Trustee has not been previously provided such
number, one should be provided as soon as possible.
Within a reasonable time after a Trust is terminated, each Unitholder who is
not a Rollover Unitholder will, upon surrender of his Units for redemption,
receive (i) the pro rata share of the amounts realized upon the disposition of
Securities, unless he or she elects an In-Kind Distribution as described under
"OTHER INFORMATION -- TERMINATION OF INDENTURE" and (ii) a pro rata share of any
other assets of such Trust, less expenses of such Trust.
The Trustee will credit to the Income Account of a Trust any dividends
received on the Securities therein. All other receipts (E.G., return of capital,
etc.) are credited to the Capital Account of the Trust.
The Trustee may establish reserves (the "RESERVE ACCOUNT") within the Trust
for state and local taxes, if any, and any governmental charges payable out of
such Trust.
DISTRIBUTION REINVESTMENT. Any Unitholder may elect to have each
distribution of income on his Units, other than the final liquidating
distribution in connection with the termination of a Trust, automatically
reinvested in additional Units of such Trust. Each person who purchases Units of
a Trust may elect to participate in the reinvestment option by notifying the
Trustee in writing of their election. Reinvestment may not be available in all
states. Notification to the Trustee must be received within 10 days prior to the
Record Date for such distributions. Each subsequent distribution of income
and/or capital, as selected by the Unitholder, will be automatically applied by
the Trustee to purchase additional Units of a Trust. The remaining deferred
sales charge payments will be assessed on Units acquired pursuant to
reinvestment. IT SHOULD BE REMEMBERED THAT EVEN IF DISTRIBUTIONS ARE REINVESTED,
THEY ARE STILL TREATED AS DISTRIBUTIONS FOR INCOME TAX PURPOSES.
ACCUMULATION PLAN
The Sponsor is also the principal underwriter of several open-end mutual
funds (the "ACCUMULATION FUNDS") into which Unitholders may choose to reinvest
Trust distributions. Unitholders may elect to reinvest income and capital
distributions automatically, without any sales charge. Each Accumulation Fund
has investment objectives which differ in certain respects from those of the
Trusts and may invest in securities which would not be eligible for deposit in
the Trusts. Further information concerning the Accumulation Plan and a list of
Accumulation Funds is set forth in the Information Supplement of this
Prospectus, which may be obtained by contacting the Trustee at the phone number
listed on the back cover of this Prospectus.
Participants may at any time, by so notifying the Trustee in writing, elect
to change the Accumulation Fund into which their distributions are being
reinvested, to change from capital only reinvestment to reinvestment of both
capital and income or vice versa, or to terminate their participation in the
Accumulation Plan altogether and receive future distributions on their Units in
cash. Such notice will be effective as of the next Record Date occurring at
least 10 days after the Trustee's receipt of the notice. There will be no charge
or other penalty for such change of election or termination. The character of
Trust distributions for income tax purposes will remain unchanged even if they
are reinvested in an Accumulation Fund.
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REPORTS TO UNITHOLDERS
The Trustee shall furnish Unitholders of a Trust in connection with each
distribution, a statement of the amount of income, if any, and the amount of
other receipts (received since the preceding distribution) being distributed,
expressed in each case as a dollar amount representing the pro rata share of
each Unit of a Trust outstanding. Within a reasonable period of time after the
end of each calendar year, the Trustee shall furnish to each person, who at any
time during the calendar year was a registered Unitholder of a Trust, a
statement with respect to such Trust (1) a summary of transactions in the Trust
for such year; (2) any Security sold during the year and the Securities held at
the end of such year by the Trust; (3) the redemption price per Unit based upon
a computation thereof on the 31st day of December of such year (or the last
business day prior thereto); and (4) amounts of income and capital distributed
during such year.
In order to comply with Federal and state tax reporting requirements,
Unitholders will be furnished, upon request to the Trustee, evaluations of the
Securities in the Trust furnished to it by the Sponsor.
UNIT VALUE AND EVALUATION
The value of the Trust is determined by the Trustee on the basis of (1) the
cash on hand in the Trust other than cash deposited in the Trust to purchase
Securities not applied to the purchase of such Securities; (2) the aggregate
value of the Securities held in the Trust, as determined by the Evaluator on the
basis of the aggregate underlying value of the Securities in the Trust next
computed; and (3) dividends receivable on the Securities trading ex-dividend as
of the date of computation; and deducting therefrom: (1) amounts representing
any applicable taxes or governmental charges payable out of such Trust; (2) any
amounts owing to the Trustee for its advances; (3) an amount representing
estimated accrued expenses of the Trust, including, but not limited to, fees and
expenses of the Trustee (including legal fees) and supervisory fees, if any; (4)
cash held for distribution to Unitholders of record of the Trust or for
redemption of tendered Units as of the business day prior to the evaluation
being made; and (5) other liabilities incurred by the Trust. The result of such
computation is divided by the number of Units of such Trust outstanding as of
the date thereof to determine the per Unit value ("UNIT VALUE") of such Trust.
The Trustee may determine the aggregate underlying value of the Securities in
the Trust in the following manner: if the Securities are listed on a securities
exchange or the NASDAQ National Market System, this evaluation is generally
based on the closing sale prices on that exchange or that system (unless it is
determined that these prices are inappropriate as a basis for valuation) or, if
there is no closing sale price on that exchange or system, at the closing bid
prices. If the Securities are not so listed or, if so listed and the principal
market therefor is other than on a securities exchange, the evaluation shall
generally be based on the current bid prices on the over-the-counter market
(unless these prices are inappropriate as a basis for evaluation). If current
bid prices are unavailable, the evaluation is generally determined (a) on the
basis of current bid prices for comparable securities, (b) by appraising the
value of the Securities on the bid side of the market or (c) by any combination
of the above. Although the Unit Value of each Trust is based on the BID prices
of the Securities, the Units are sold initially to the public at the Public
Offering Price based on the OFFERING prices of the Securities.
DISTRIBUTIONS OF UNITS TO THE PUBLIC
Nuveen, in addition to being the Sponsor, is the sole Underwriter of the
Units. It is the intention of the Sponsor to qualify Units of the Trusts for
sale under the laws of substantially all of the states of the United States of
America.
Promptly following the deposit of Securities in exchange for Units of the
Trusts, it is the practice of the Sponsor to place all of the Units as
collateral for a letter or letters of credit from one or more commercial banks
under an agreement to release such Units from time to time as needed for
distribution. Under such an arrangement the Sponsor pays such banks compensation
based on the then current interest rate. This is a
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normal warehousing arrangement during the period of distribution of the Units to
public investors. To facilitate the handling of transactions, sales of Units
shall be limited to transactions involving a minimum of either $3,000 or 300
Units ($1,000 for IRA accounts), whichever is less. The Sponsor reserves the
right to reject, in whole or in part, any order for the purchase of Units.
The Sponsor plans to allow a discount to brokers and dealers in connection
with the distribution of Units. The amounts of such discounts are set forth in
Part A of this Prospectus.
The Sponsor may maintain a secondary market for Units of each Trust. See
"MARKET FOR UNITS."
The Sponsor reserves the right to change the amount of the dealer
concessions set forth in Part A of this Prospectus from time to time.
Registered investment advisers, certified financial planners and registered
broker-dealers who in each case either 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, and bank trust departments
investing funds over which they exercise exclusive discretionary investment
authority and that are held in a fiduciary, agency, custodial or similar
capacity, are not entitled to receive any dealer concession for any sales made
to investors which qualified as "Discounted Purchases" during the primary or
secondary market. (See "PUBLIC OFFERING PRICE.")
Certain commercial banks are making Units of the Trusts 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 shown in the
above table. The Glass-Steagall Act prohibits banks from underwriting Trust
Units; the Act does, however, permit certain agency transactions and banking
regulators have not indicated that these particular agency transactions are not
permitted under the Act. In Texas and in certain other states, any bank making
Units available must be registered as a broker-dealer under state law.
OWNERSHIP AND TRANSFER OF UNITS
The ownership of Units is evidenced by registered Certificates unless the
Unitholder expressly requests that ownership be evidenced by a book entry
position recorded on the books and records of the Trustee. The Trustee is
authorized to treat as the owner of Units that person who at the time is
registered as such on the books of the Trustee. Any Unitholder who holds a
Certificate may change to book entry ownership by submitting to the Trustee the
Certificate along with a written request that the Units represented by such
Certificate be held in book entry form. Likewise, a Unitholder who holds Units
in book entry form may obtain a Certificate for such Units by written request to
the Trustee. Units may be held in denominations of one Unit or any multiple or
fraction thereof. Fractions of Units are computed to three decimal places. Any
Certificates issued will be numbered serially for identification, and are issued
in fully registered form, transferable only on the books of the Trustee. Book
entry Unitholder will receive a Book Entry Position Confirmation reflecting
their ownership.
Units are transferable by making a written request to the Trustee and, in
the case of Units evidenced by Certificate(s), by presenting and surrendering
such Certificate(s) to the Trustee, at its address listed on the back cover of
this Part B of the Prospectus, properly endorsed or accompanied by a written
instrument or instruments of transfer. The Certificate(s) should be sent
registered or certified mail for the protection of the Unitholders. Each
Unitholder must sign such written request, and such Certificate(s) or transfer
instrument, exactly as his name appears on (a) the face of the Certificate(s)
representing the Units to be transferred, or (b) the Book Entry Position
Confirmation(s) relating to the Units to be transferred. Such signature(s) must
be guaranteed by a guarantor acceptable to 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. Mutilated Certificates must be surrendered
to the Trustee
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in order for a replacement Certificate to be issued. Although at the date hereof
no charge is made and none is contemplated, a Unitholder may be required to pay
$2.00 to the Trustee for each Certificate reissued or transfer of Units
requested and to pay any governmental charge which may be imposed in connection
therewith.
REPLACEMENT OF LOST, STOLEN OR DESTROYED CERTIFICATES
To obtain a new Certificate replacing one that has been lost, stolen, or
destroyed, the Unitholder must furnish the Trustee with sufficient
indemnification and pay such expenses as the Trustee may incur. This
indemnification must be in the form of an Open Penalty Bond of Indemnification.
The premium for such an indemnity bond may vary, but currently amounts to 1% of
the market value of the Units represented by the Certificate. In the case
however, of a Trust as to which notice of termination has been given, the
premium currently amounts to 0.5% of the market value of the Units represented
by such Certificate.
REDEMPTION
Unitholders may redeem all or a portion of their Units by (1) making a
written request for such redemption (book entry Unitholders may use the
redemption form on the reverse side of their Book Entry Position Confirmation)
to the Trustee at its address listed on the back cover of this Part B of the
Prospectus (redemptions of 1,000 Units or more will require a signature
guarantee), (2) in the case of Units evidenced by a Certificate, by also
tendering such Certificate to the Trustee, duly endorsed or accompanied by
proper instruments of transfer with signatures guaranteed as explained above, or
provide satisfactory indemnity required in connection with lost, stolen or
destroyed Certificates and (3) payment of applicable governmental charges, if
any. Certificates should be sent only by registered or certified mail to
minimize the possibility of their being lost or stolen. (See "OWNERSHIP AND
TRANSFER OF UNITS.") No redemption fee will be charged. A Unitholder may
authorize the Trustee to honor telephone instructions for the redemption of
Units held in book entry form. Units represented by Certificates may not be
redeemed by telephone. The proceeds of Units redeemed by telephone will be sent
by check either to the Unitholder at the address specified on his account or to
a financial institution specified by the Unitholder for credit to the account of
the Unitholders. A Unitholder wishing to use this method of redemption must
complete a Telephone Redemption Authorization Form and furnish the Form to the
Trustee. Telephone Redemption Authorization Forms can be obtained from a
Unitholder's registered representative or by calling the Trustee. Once the
completed Form is on file, the Trustee will honor telephone redemption requests
by any authorized person. The time a telephone redemption request is received
determines the "date of tender" as discussed below. The redemption proceeds will
be mailed within three business days following the telephone redemption request.
Only Units held in the name of individuals may be redeemed by telephone;
accounts registered in broker name, or accounts of corporations or fiduciaries
(including among others, trustees, guardians, executors and administrators) may
not use the telephone redemption privilege.
On the third business day following the date of tender, the Unitholder will
be entitled to receive in cash for each Unit tendered an amount equal to the
Unit Value of such Trust determined by the Trustee, as of 4:00 p.m. eastern
time, or as of any earlier closing time on a day on which the Exchange is
scheduled in advance to close at such earlier time, on the date of tender as
defined hereafter, plus accrued interest to, but not including, the third
business day after the date of tender ("REDEMPTION PRICE"). The price received
upon redemption may be more or less than the amount paid by the Unitholder
depending on the value of the Securities on the date of tender. Units subject to
a deferred sales charge which are tendered for redemption prior to such time as
the entire deferred sales charge on such Units has been collected will be
assessed the amount of the remaining deferred sales charge at the time of
redemption. Unitholders should check with the Trustee or their broker to
determine the Redemption Price before tendering Units.
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The "DATE OF TENDER" is deemed to be the date on which the request for
redemption of Units is received in proper form by the Trustee, except that as
regards a redemption request received after 4:00 p.m. eastern time, or as of any
earlier closing time on a day on which the Exchange is scheduled in advance to
close at such earlier time, or on any day on which the Exchange is normally
closed, the date of tender is the next day on which such Exchange is normally
open for trading and such request will be deemed to have been made on such day
and the redemption will be effected at the Redemption Price computed on that
day.
Any Unitholder tendering 2,500 Units or more for redemption may request by
written notice submitted at the time of tender from the Trustee, in lieu of a
cash redemption, a distribution of shares of Securities in an amount and value
of Securities per Unit equal to the Redemption Price Per Unit, as determined as
of the evaluation next following tender. In-kind distributions ("IN-KIND
DISTRIBUTIONS") shall be made by the Trustee through the distribution of each of
the Securities in book-entry form to the account of the Unitholder's bank or
broker/dealer at the Depository Trust Company. An In-Kind Distribution will be
reduced by customary transfer and registration charges. The tendering Unitholder
will receive his pro rata number of whole shares of each of the Securities
comprising a portfolio and cash from the Capital Account equal to the fractional
shares to which the tendering Unitholder is entitled. The Trustee may adjust the
number of shares of any issue of Securities included in a Unitholder's In-Kind
Distribution to facilitate the distribution of whole shares, such adjustment to
be made on the basis of the value of Securities on the date of tender. If funds
in the Capital Account are insufficient to cover the required cash distribution
to the tendering Unitholder, the Trustee may sell Securities in the manner
described below.
Under regulations issued by the Internal Revenue Service, the Trustee is
required to withhold a specified percentage of the principal amount of a Unit
redemption if the Trustee has not been furnished the redeeming Unitholder's tax
identification number in the manner required by such regulations. For further
information regarding this withholding, see "DISTRIBUTIONS TO UNITHOLDERS." In
the event the Trustee has not been previously provided such number, one must be
provided at the time redemption is requested.
Any amounts paid on redemption representing income shall be withdrawn from
the Income Account of a Trust to the extent that funds are available for such
purpose, or from the Capital Account. All other amounts paid on redemption shall
be withdrawn from the Capital Account.
The Trustee is empowered to sell Securities of the Trusts in order to make
funds available for redemption. To the extent that Securities are sold, the size
and diversity of the 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.
The Redemption Price per Unit during the secondary market will be determined
on the basis of the aggregate underlying value of the Securities in a Trust plus
or minus cash, if any, in the Income and Capital Accounts of such Trust. The
Redemption Price per Unit is equal to the pro rata share of each Unit determined
by the Trustee by adding: (1) the cash on hand in the Trust other than cash
deposited in the Trust to purchase Securities not applied to the purchase of
such Securities; (2) the aggregate underlying value of the Securities held in
such Trust, as determined by the Trustee on the basis of the evaluation next
computed; and (3) dividends receivable on the Securities trading ex-dividend as
of the date of computation; and deducting therefrom: (1) amounts representing
any applicable taxes or governmental charges payable out of such Trust; (2) any
amounts owing to the Trustee for its advances; (3) an amount representing
estimated accrued expenses of such Trust, including but not limited to fees and
expenses of the Trustee (including legal fees), and supervisory fees, if any;
(4) cash held for distribution to Unitholders of record of such Trust or for
redemption of tendered Units as of the business day prior to the evaluation
being made; and (5) other liabilities incurred by such Trust; and finally
dividing the results of such computation by the number of Units of such Trust
outstanding as of the date thereof. The redemption price per Unit will be
assessed the amount, if any, of the remaining deferred sales charge at the time
of redemption.
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The aggregate value of the Securities for purposes of the Redemption Price
during the secondary market and the Secondary Market Public Offering Price will
be determined in the following manner: if the Securities are listed on a
securities exchange or the NASDAQ National Market System, this evaluation is
generally based on the closing sale prices on that exchange or that system
(unless it is determined that these prices are inappropriate as a basis for
valuation) or, if there is no closing sale price on that exchange or system, at
the closing bid prices. If the Securities are not so listed or, if so listed and
the principal market therefore is other than on a securities exchange, the
evaluation shall generally be based on the current bid prices on the over-
the-counter market (unless these prices are inappropriate as a basis for
evaluation). If current bid prices are unavailable, the evaluation is generally
determined (a) on the basis of current bid prices for comparable securities, (b)
by appraising the value of the Securities on the bid side of the market or (c)
by any combination of the above.
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 the New York Stock Exchange is
restricted or any 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. Under certain
extreme circumstances, the Sponsor may apply to the Securities and Exchange
Commission for an order permitting a full or partial suspension of the right of
Unitholders to redeem their Units. The Trustee is not liable to any person in
any way for any loss or damage which may result from any such suspension or
postponement.
SPECIAL REDEMPTION, LIQUIDATION AND INVESTMENT IN A NEW TRUST
It is expected that a special redemption and liquidation will be made of all
Units of a Trust held by any Unitholder (a "ROLLOVER UNITHOLDER") who
affirmatively notifies the Trustee in writing that he or she desires to
participate as a Rollover Unitholder by the Rollover Notification Date specified
in the "ESSENTIAL INFORMATION" appearing in Part A of this Prospectus.
All Units of Rollover Unitholders will be redeemed In-Kind during the
Special Redemption and Liquidation Period and the underlying Securities will be
distributed to the Distribution Agent (currently the Trustee) on behalf of the
Rollover Unitholders. During the Special Redemption and Liquidation Period (as
set forth in "ESSENTIAL INFORMATION" in Part A), the Distribution Agent will be
required to sell all of the underlying Securities on behalf of Rollover
Unitholders. The sales proceeds will be net of brokerage fees, governmental
charges or any expenses involved in the sales.
The Distribution Agent may engage the Sponsor, as its agent, or other
brokers to sell the distributed Securities. The Securities will be sold as
quickly as is practicable during the Special Redemption and Liquidation Period.
The Sponsor does not anticipate that the period will be longer than one or two
days, given that the Securities are usually highly liquid. The liquidity of any
Security depends on the daily trading volume of the Security and the amount that
the Sponsor has available for sale on any particular day.
The Rollover Unitholders' proceeds will be invested in a New Trust or a
trust with a similar investment strategy (as selected by the Unitholder), if
then registered and being offered. The proceeds of redemption will be used to
buy New Trust units as the proceeds become available. Any Rollover Unitholder
may thus be redeemed out of a Trust and become a holder of an entirely different
trust, a New Trust, with a different portfolio of Securities. In accordance with
the Rollover Unitholders' offer to purchase the New Trust units, the proceeds of
the sales (and any other cash distributed upon redemption) will be invested in a
New Trust, at the public offering price, including the applicable maximum sales
charge per Unit (which for Rollover Unitholders is currently expected to be
$0.175 per unit for the New Series of a Trust, all of which will be deferred as
provided herein).
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The Sponsor intends to create the New Trust units as quickly as possible,
depending upon the availability and reasonably favorable prices of the
Securities included in a New Trust portfolio, and it is intended that Rollover
Unitholders will be given first priority to purchase the New Trust units. The
Sponsor may also permit Rollover Unitholders to elect to have their proceeds
invested in a trust with a similar investment strategy, if such trust is then
registered in the Unitholder's state of residence and being offered. There can
be no assurance, however, as to the exact timing of the creation of the New
Trust units or the aggregate number of New Trust units which the Sponsor will
create. The Sponsor may, in its sole discretion, stop creating new units
(whether permanently or temporarily) at any time it chooses, regardless of
whether all proceeds of the Special Redemption and Liquidation have been
invested on behalf of Rollover Unitholders. Cash which has not been invested on
behalf of the Rollover Unitholders in New Trust units will be distributed within
a reasonable time after such occurrence. However, since the Sponsor can create
units, the Sponsor anticipates that sufficient units can be created, although
moneys in a New Trust may not be fully invested on the next business day.
The process of redemption, liquidation, and investment in a New Trust is
intended to allow for the fact that the portfolios selected by the Sponsor are
chosen on the basis of growth potential only for a year, at which point a new
portfolio is chosen. It is contemplated that a similar process of redemption,
liquidation and investment in a New Trust will be available as each Trust
terminates.
It should also be noted that Rollover Unitholders may realize taxable
capital gains on the Special Redemption and Liquidation but, in certain
circumstances, will not be entitled to a deduction for certain capital losses
and, due to the procedures for investing in a New Trust, no cash would be
distributed at that time to pay any taxes. Included in the cash for the Special
Redemption and Liquidation will be an amount of cash attributable to the second
distribution of dividend income; accordingly, Rollover Unitholders also will not
have cash from this source distributed to pay any taxes. See "Tax Status."
In addition, during this period a Unitholder will be at risk to the extent
that Securities are not sold and will not have the benefit of any stock
appreciation to the extent that moneys have not been invested; for this reason,
the Sponsor will be inclined to sell and purchase the Securities in as short a
period as it can without materially adversely affecting the price of the
Securities.
Unitholders who do not inform the Distribution Agent that they wish to have
their Units so redeemed and liquidated ("REMAINING UNITHOLDERS") will not
realize capital gains or losses due to the Special Redemption and Liquidation,
and will not be charged any additional sales charge.
The Sponsor may for any reason, in its sole discretion, decide not to
sponsor the New Trusts or any subsequent series of the Trusts, without penalty
or incurring liability to any Unitholder. If the Sponsor so decides, the Sponsor
shall notify the Unitholders before the Special Redemption and Liquidation. All
Unitholders will then be remaining Unitholders, with rights to ordinary
redemption as before. See "REDEMPTION." The Sponsor may modify the terms of the
New Trusts or any subsequent series of the Trusts. The Sponsor may also modify,
suspend or terminate the Rollover Option upon notice to the Unitholders of such
amendment at least 60 days prior to the effective date of such amendment.
PURCHASE OF UNITS BY THE SPONSOR
The Trustee will 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 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 Unitholder not later than the day on which payment would
otherwise have been made by the Trustee. (See "REDEMPTION.") The Sponsor's
current practice is to bid at the Redemption Price in the secondary market.
Units held by the Sponsor may be tendered to the Trustee for redemption as any
other Units.
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REMOVAL OF SECURITIES FROM THE TRUSTS
The portfolio of the Trust is not "managed" by the Sponsor or the Trustee;
their activities described herein are governed solely by the provisions of the
Indenture. The Indenture provides that the Sponsor may (but need not) direct the
Trustee to dispose of an Security in the event that an issuer defaults in the
payment of a dividend that has been declared, that any action or proceeding has
been instituted restraining the payment of dividends or there exists any legal
question or impediment affecting such Security, that the issuer of the Security
has breached a covenant which would affect the payments of dividends, the credit
standing of the issuer or otherwise impair the sound investment character of the
Security, that the issuer has defaulted on the payment on any other of its
outstanding obligations, that the price of the Security has declined to such an
extent or other such credit factors exist so that in the opinion of the Sponsor,
the retention of such Securities would be detrimental to a Trust. Except as
stated under "COMPOSITION OF TRUSTS" for Failed Securities, the acquisition by a
Trust of any securities or other property other than the Securities is
prohibited. Pursuant to the Indenture and with limited exceptions, the Trustee
may sell any securities or other property acquired in exchange for Securities
such as those acquired in connection with a merger or other transaction. If
offered such new or exchanged securities or property, the Trustee shall reject
the offer. However, in the event such securities or property are nonetheless
acquired by a Trust, they may be accepted for deposit in a Trust and either sold
by the Trustee or held in a Trust pursuant to the direction of the Sponsor.
Proceeds from the sale of Securities by the Trustee are credited to the Capital
Account of a Trust for distribution to Unitholders or to meet redemptions.
The Trustee may also sell Securities designated by the Sponsor, or if not so
directed, in its own discretion, for the purpose of redeeming Units of a Trust
tendered for redemption and the payment of expenses.
The Sponsor, in designating Securities to be sold by the Trustee, will
generally make selections in order to maintain, to the extent practicable, the
proportionate relationship among the number of shares of individual issues of
Securities. To the extent this is not practicable, the composition and diversity
of the Securities may be altered. In order to obtain the best price for a Trust,
it may be necessary for the Sponsor to specify minimum amounts (generally 100
shares) in which blocks of Securities are to be sold.
INFORMATION ABOUT THE TRUSTEE
The Trustee and its address are stated on the back cover of this Part B of
the Prospectus. The Trustee is subject to supervision and examination by the
Federal Deposit Insurance Corporation, the Board of Governors of the Federal
Reserve System and either the Comptroller of the Currency or state banking
authorities.
LIMITATIONS ON LIABILITIES OF SPONSOR AND TRUSTEE
The Sponsor and the Trustee shall be under no liability to Unitholders for
taking any action or for refraining from any action in good faith pursuant to
the Indenture, or for errors in judgment, but shall be liable only for their own
negligence, lack of good faith or willful misconduct. 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 any 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.
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SUCCESSOR TRUSTEES AND SPONSORS
The Trustee or any successor trustee may resign by executing an instrument
of resignation in writing and filing same with the Sponsor and mailing a copy of
a notice of resignation to all Unitholders then of record. Upon receiving such
notice, the Sponsor is required to promptly appoint a successor trustee. If the
Trustee becomes incapable of acting or is adjudged a bankrupt or insolvent, or a
receiver or other public officer shall take charge of its property or affairs,
the Sponsor may remove the Trustee and appoint a successor by written
instrument. The resignation or removal of a trustee and the appointment of a
successor trustee shall become effective only when the successor trustee accepts
its appointment as such. Any successor trustee shall be a corporation authorized
to exercise corporate trust powers, having capital, surplus and undivided
profits of not less than $5,000,000. 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.
If upon resignation of a trustee no successor has been appointed and 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.
If the Sponsor fails to undertake any of its duties under the Indenture, and
no express provision is made for action by the Trustee in such event, the
Trustee may, in addition to its other powers under the Indenture (1) appoint a
successor sponsor or (2) terminate the Indenture and liquidate the Trusts.
INFORMATION ABOUT THE SPONSOR
Since our founding in 1898, Nuveen has been synonymous with investments that
withstand the test of time. Today, we offer a broad range of investments
designed for mature investors whose portfolio is the principal source of their
ongoing financial security. More than 1.3 million investors have entrusted
Nuveen to help them maintain the lifestyle they currently enjoy.
A value investing approach--purchasing securities of strong companies and
communities that represent good long-term value--is the cornerstone of Nuveen's
investment philosophy. It is a careful, long-term strategy that offers the
potential for attractive returns with moderated risk. Successful value investing
begins with in-depth research and a discerning eye for marketplace opportunity.
Nuveen's team of investment professionals is backed by the discipline, resources
and expertise of almost a century of investment experience, including one of the
most recognized research departments in the industry.
To meet the unique circumstances and financial planning needs of mature
investors, Nuveen offers a wide array of taxable and tax-free investment
products--including equity and fixed-income mutual funds, unit trusts,
exchange-traded funds, customized asset management services and cash management
products.
Nuveen is a subsidiary of The John Nuveen Company which, in turn, is
approximately 78% owned by the St. Paul Companies, Inc. ("ST. PAUL"). St. Paul
is located in St. Paul, Minnesota and is principally engaged in providing
property-liability insurance through subsidiaries. Nuveen is a member of the
National Association of Securities Dealers, Inc. and the Securities Industry
Association and has its principal offices located in Chicago (333 West Wacker
Drive). Nuveen maintains 11 regional offices.
To help advisers and investors better understand and more efficiently use an
investment in the Trusts to reach their investment goals, the Sponsor may
advertise and create specific investment programs and systems. For example, such
activities may include presenting information on how to use an investment in the
Trust, alone or in combination with an investment in other mutual funds or unit
investment trusts sponsored by Nuveen, to accumulate assets for future education
needs or periodic payments such as insurance
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premiums. The Sponsor may produce software or additional sales literature to
promote the advantages of using the Trusts to meet these and other specific
investor needs.
OTHER INFORMATION
AMENDMENT OF INDENTURE
The Indenture may be amended by the Trustee and the Sponsor without the
consent of any of the Unitholders (1) to cure any ambiguity or to correct or
supplement any provision thereof which may be defective or inconsistent, or (2)
to make such other provisions as shall not adversely affect the Unitholders,
provided, however, that the Indenture may not be amended to permit the deposit
or acquisition of securities either in addition to, or in substitution for any
of the Securities initially deposited in any Trust except as stated in
"COMPOSITION OF TRUSTS" regarding the creation of additional Units and the
limited right of substitution of Replacement Securities and except for the
substitution of refunding securities under certain circumstances. The Trustee
shall advise the Unitholders of any amendment requiring the consent of
Unitholders, or upon request of the Sponsor, promptly after execution thereof.
TERMINATION OF INDENTURE
____The Trust may be liquidated at any time by written consent of 100% of the
Unitholders or by the Trustee when the value of such Trust, as shown by any
evaluation, is less than 20% of the total value of the Securities deposited in
the Trust during the primary offering period and will be liquidated by the
Trustee in the event that Units not yet sold aggregating more than 60% of the
Units originally created are tendered for redemption by the Sponsor. (See
"ESSENTIAL INFORMATION" appearing in Part A of this Prospectus.) The sale of
Securities from the Trust upon termination may result in realization of a lesser
amount than might otherwise be realized if such sale were not required at such
time. For this reason, among others, the amount realized by a Unitholder upon
termination may be less than the amount of Securities originally represented by
the Units held by such Unitholder. The Indenture will terminate upon the
redemption, sale or other disposition of the last Security held thereunder, but
in no event shall it continue beyond the Mandatory Termination Date set forth
under "ESSENTIAL INFORMATION" in Part A of this Prospectus.
Commencing on the Mandatory Termination Date, Securities will begin to be
sold in connection with the termination of the Trust. The Sponsor will determine
the manner, timing and execution of the sale of the Securities. Written notice
of any termination of a Trust specifying the time or times at which Unitholders
may surrender their certificates for cancellation shall be given by the Trustee
to each Unitholder at his address appearing on the registration books of such
Trust maintained by the Trustee. Unitholders not electing a distribution of
shares of Securities and who do not elect the Rollover Option will receive a
cash distribution from the sale of the remaining Securities within a reasonable
time after the Trust is terminated. Regardless of the distribution involved, the
Trustee will deduct from the funds of a Trust any accrued costs, expenses,
advances or indemnities provided by the Indenture, including estimated
compensation of the Trustee and costs of liquidation and any amounts required as
a reserve to provide for payment of any applicable taxes or other governmental
charges. Trustee will then distribute to each Unitholder his pro rata share of
the balance of the Income and Capital Accounts.
LEGAL OPINION
The legality of the Units offered hereby has been passed upon by Chapman and
Cutler, 111 West Monroe Street, Chicago, Illinois 60603. Carter, Ledyard &
Milburn, 2 Wall Street, New York, New York 10005, has acted as counsel for the
Trustee with respect to the Series.
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AUDITORS
The "STATEMENT OF CONDITION" and "SCHEDULE OF INVESTMENTS" at Initial Date
of Deposit included in Part A of this Prospectus have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their report in
Part A of this Prospectus, and are included herein in reliance upon the
authority of said firm as experts in giving said report.
SUPPLEMENTAL INFORMATION
Upon written or telephonic request to the Trustee, investors will receive at
no cost to the investor supplemental information about this Trust, which has
been filed with the Securities and Exchange Commission and is intended to
supplement information contained in Part A and Part B of this Prospectus. This
supplement includes additional general information about the Sponsor and the
Trusts.
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NUVEEN UNIT TRUSTS
NUVEEN -- STANDARD & POOR'S QUALITY EQUITY PORTFOLIO TRUST
PROSPECTUS -- PART B
MAY 29, 1997
<TABLE>
<C> <S>
Sponsor John Nuveen & Co. Incorporated
333 West Wacker Drive
Chicago, IL 60606-1286
Trustee The Chase Manhattan Bank
4 New York Plaza
New York, NY 10004-2413
Telephone: 800-257-8787
Legal Counsel to Sponsor Chapman and Cutler
111 West Monroe Street
Chicago, IL 60603
Independent Arthur Andersen LLP
Public Accountants 33 West Monroe Street
for the Trust Chicago, IL 60603
</TABLE>
Except as to statements made herein furnished by the Trustee, the Trustee
has assumed no responsibility for the accuracy, adequacy and completeness of the
information contained in this Prospectus.
When Units of the Trusts are no longer available, or for investors who will
reinvest into subsequent series of the Trusts, this Prospectus may be used as a
preliminary prospectus for a future series; in which case investors should note
the following:
INFORMATION CONTAINED HEREIN IS SUBJECT TO AMENDMENT. A REGISTRATION
STATEMENT RELATING TO SECURITIES OF A FUTURE SERIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE.
THE PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF
AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN
WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION
OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
This Prospectus does not contain all of the information set forth in the
registration statement and exhibits relating thereto, filed with the Securities
and Exchange Commission, Washington, D.C., under the Securities Act of 1933, and
to which reference is made.
No person is authorized to give any information or to make representations
not contained in this Prospectus or in supplemental information or sales
literature prepared by the Sponsor, and any information or representation not
contained therein must not be relied upon as having been authorized by either
the Trusts, the Trustee or the Sponsor. This Prospectus does not constitute an
offer to sell, or a solicitation of an offer to buy, securities in any State to
any Person to whom it is not lawful to make such offer in such state. The Trusts
are registered as Unit Investment Trusts under the Investment Company Act of
1940, as amended. Such registration does not imply that the Trusts or any of
their Units have been guaranteed, sponsored, recommended or approved by the
United States or any State or agency or officer thereof.
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NUVEEN UNIT TRUSTS
NUVEEN--STANDARD & POOR'S QUALITY EQUITY PORTFOLIO TRUST PROSPECTUS
MAY 29, 1997
NUVEEN UNIT TRUSTS
INFORMATION SUPPLEMENT
NUVEEN UNIT TRUST SERIES 4
The Information Supplement provides additional information concerning the
structure and operations of a Nuveen Unit Trust not found in the prospectuses
for the Trusts. This Information Supplement is not a prospectus and does not
include all of the information that a prospective investor should consider
before investing in a Trust. This Information Supplement should be read in
conjunction with the prospectus for the Trust in which an investor is
considering investing ("PROSPECTUS"). Copies of the Prospectus can be obtained
by calling or writing the Trustee at the telephone number and address indicated
in Part B of the Prospectus. This Information Supplement has been created to
supplement information contained in the Prospectus.
This Information Supplement is dated May 29, 1997. Capitalized terms have
been defined in the Prospectus.
TABLE OF CONTENTS
<TABLE>
<S> <C>
ACCUMULATION PLAN...................................................................... 2
INFORMATION ABOUT THE SPONSOR.......................................................... 4
</TABLE>
APPENDIX A-- STANDARD & POOR'S EARNINGS AND DIVIDEND RANKINGS FOR COMMON STOCKS
APPENDIX B--STANDARD & POOR'S CORPORATE RATINGS CRITERIA
S-1
<PAGE>
ACCUMULATION PLAN
The Sponsor, John Nuveen & Co. Incorporated, is also the principal
underwriter of the Accumulation Funds listed in the following table. Each of
these funds is an open-end, diversified management investment company into which
Unitholders may choose to reinvest Trust distributions automatically, without
any sales charge. Unitholders may reinvest both interest and capital
distributions or capital distributions only. Each Accumulation Fund has
investment objectives which differ in certain respects from those of the Trusts
and may invest in securities which would not be eligible for deposit in the
Trusts. The investment adviser to each Accumulation Fund is a wholly-owned
subsidiary of the Sponsor. Unitholders should contact their financial adviser or
the Sponsor to determine which of the Accumulation Funds they may reinvest into,
as reinvestment in certain of the Accumulation Funds may be restricted to
residents of a particular state or states. Unitholders may obtain a prospectus
for each Accumulation Fund through their financial adviser or through the
Sponsor at (800) 621-7227. For a more detailed description, Unitholders should
read the prospectus of the Accumulation Fund in which they are interested.
The following is a complete list of the Accumulation Funds currently
available, as of the Date of Deposit of this Prospectus, to Unitholders under
the Accumulation Plan. The list of available Accumulation Funds is subject to
change without the consent of any of the Unitholders.
ACCUMULATION FUNDS
MUTUAL FUNDS
NUVEEN FLAGSHIP MUNICIPAL TRUST
Nuveen Municipal Bond Fund
Nuveen Insured Municipal Bond Fund
Nuveen Flagship All-American Municipal Bond Fund
Nuveen Flagship Limited Term Municipal Bond Fund
Nuveen Flagship Intermediate Municipal Bond Fund
NUVEEN FLAGSHIP MULTISTATE TRUST I
Nuveen Flagship Arizona Municipal Bond Fund
Nuveen Flagship Colorado Municipal Bond Fund
Nuveen Flagship Florida Municipal Bond Fund
Nuveen Flagship Florida Intermediate Municipal Bond Fund
Nuveen Maryland Municipal Bond Fund
Nuveen Flagship New Mexico Municipal Bond Fund
Nuveen Flagship Pennsylvania Municipal Bond Fund
Nuveen Flagship Virginia Municipal Bond Fund
NUVEEN FLAGSHIP MULTISTATE TRUST II
Nuveen California Municipal Bond Fund
Nuveen California Insured Municipal Bond Fund
Nuveen Flagship Connecticut Municipal Bond Fund
Nuveen Massachusetts Municipal Bond Fund
Nuveen Massachusetts Insured Municipal Bond Fund
Nuveen Flagship New Jersey Municipal Bond Fund
Nuveen Flagship New Jersey Intermediate Municipal Bond Fund
Nuveen Flagship New York Municipal Bond Fund
Nuveen New York Insured Municipal Bond Fund
S-2
<PAGE>
NUVEEN FLAGSHIP MULTISTATE TRUST III
Nuveen Flagship Alabama Municipal Bond Fund
Nuveen Flagship Georgia Municipal Bond Fund
Nuveen Flagship Louisiana Municipal Bond Fund
Nuveen Flagship North Carolina Municipal Bond Fund
Nuveen Flagship South Carolina Municipal Bond Fund
Nuveen Flagship Tennessee Municipal Bond Fund
NUVEEN FLAGSHIP MULTISTATE TRUST IV
Nuveen Flagship Kansas Municipal Bond Fund
Nuveen Flagship Kentucky Municipal Bond Fund
Nuveen Flagship Kentucky Limited Term Municipal Bond Fund
Nuveen Flagship Michigan Municipal Bond Fund
Nuveen Flagship Missouri Municipal Bond Fund
Nuveen Flagship Ohio Municipal Bond Fund
Nuveen Flagship Wisconsin Municipal Bond Fund
Flagship Utility Income Fund
Nuveen Growth and Income Stock Fund
Nuveen Balanced Stock and Bond Fund
Nuveen Balanced Municipal and Stock Fund
MONEY MARKET FUNDS
Nuveen California Tax-Free Money Market Fund
Nuveen Massachusetts Tax-Free Money Market Fund
Nuveen New York Tax-Free Money Market Fund
Nuveen Tax-Free Reserves, Inc.
Nuveen Tax-Exempt Money Market Fund, Inc.
Each person who purchases Units of a Trust may become a participant in the
Accumulation Plan and elect to have his or her distributions on Units of the
Trust invested directly in shares of one of the Accumulation Funds. Reinvesting
Unitholders may select any interest distribution plan. Thereafter, each
distribution of interest income or principal on the participant's Units
(principal only in the case of a Unitholder who has chosen to reinvest only
principal distributions) will, on the applicable distribution date, or the next
day on which the New York Stock Exchange is nominally open ("BUSINESS DAY") if
the distribution date is not a business day, automatically be received by the
transfer agent for each of the Accumulation Funds, on behalf of such participant
and applied on that date to purchase shares (or fractions thereof) of the
Accumulation Fund chosen at net asset value as computed as of 4:00 p.m. eastern
time on each such date. All distributions will be reinvested in the Accumulation
Fund chosen and no part thereof will be retained in a separate account. These
purchases will be made without a sales charge.
The Transfer Agent of the Accumulation Fund will mail to each participant in
the Accumulation Plan a quarterly statement containing a record of all
transactions involving purchases of Accumulation Fund shares (or fractions
thereof) with Trust dividend distributions or as a result of reinvestment of
Accumulation Fund dividends. Any distribution of capital used to purchase shares
of an Accumulation Fund will be separately
S-3
<PAGE>
confirmed by the Transfer Agent. Unitholders will also receive distribution
statements from the Trustee detailing the amounts transferred to their
Accumulation Fund accounts.
Participants may at any time, by so notifying the Trustee in writing, elect
to change the Accumulation Fund into which their distributions are being
reinvested, to change from capital only reinvestment to reinvestment of both
capital and dividends or vice versa, or to terminate their participation in the
Accumulation Plan altogether and receive future distributions on their Units in
cash. There will be no charge or other penalty for such change of election or
termination. The character of Trust distributions for income tax purposes will
remain unchanged even if they are reinvested in an Accumulation Fund.
INFORMATION ABOUT THE SPONSOR
Since our founding in 1998, Nuveen has been synonymous with investments that
withstand the test of time. Today, we offer a broad range of investments
designed for mature investors whose portfolio is the principal source of their
ongoing financial security. More than 1.3 million investors have entrusted
Nuveen to help them maintain the lifestyle they currently enjoy.
A value investing approach -- purchasing securities of strong companies and
communities that represent good long-term value -- is the cornerstone of
Nuveen's investment philosophy. It is a careful, long-term strategy that offers
the potential for attractive returns with moderated risk. Successful value
investing begins with in-depth research and a discerning eye for marketplace
opportunity. Nuveen's team of investment professionals is backed by the
discipline, resources and expertise of almost a century of investment
experience, including one of the most recognized research departments in the
industry.
To meet the unique circumstances and financial planning needs of mature
investors, Nuveen offers a wide array of taxable and tax-free investment
products -- including equity and fixed-income mutual funds, unit trusts,
exchange-traded funds, customized asset management services and cash management
products.
The Sponsor is also principal underwriter of the registered open-end
investment companies set forth herein under "Accumulation Plan" as well as for
the Golden Rainbow A James Advised Mutual Fund, and acted as co-managing
underwriter of Nuveen Municipal Value Fund, Inc., Nuveen California Municipal
Value Fund, Inc., Nuveen New York Municipal Value Fund, Inc., Nuveen Municipal
Income Fund, Inc., Nuveen Premium Income Municipal Fund, Inc., Nuveen
Performance Plus Municipal Fund, Inc., Nuveen California Performance Plus
Municipal Fund, Inc., Nuveen New York Performance Plus Municipal Fund, Inc.,
Nuveen Municipal Advantage Fund, Inc., Nuveen Municipal Market Opportunity Fund,
Inc. Nuveen California Municipal Market Opportunity Fund, Inc., Nuveen
Investment Quality Municipal Fund, Inc., Nuveen California Investment Quality
Municipal Fund, Inc., Nuveen New York Investment Quality Municipal Fund, Inc.,
Nuveen Insured Quality Municipal Fund, Inc., Nuveen Florida Investment Quality
Municipal Fund, Nuveen Pennsylvania Investment Quality Municipal Fund, Nuveen
New Jersey Investment Quality Municipal Fund, Inc., and the Nuveen Select
Quality Municipal Fund, Inc., Nuveen California Select Quality Municipal Fund,
Inc., Nuveen New York Select Quality Municipal Fund, Inc., Nuveen Quality Income
Municipal Fund, Inc., Nuveen Insured Municipal Opportunity Fund, Inc., Nuveen
Florida Quality Income Municipal Fund, Nuveen Michigan Quality Income Municipal
Fund, Inc., Nuveen Ohio Quality Income Municipal Fund, Inc., Nuveen Texas
Quality Income Municipal Fund, Nuveen California Quality Income Municipal Fund,
Inc., Nuveen New York Quality Income Municipal Fund, Inc., Nuveen Premier
Municipal Income Fund, Inc., Nuveen Premier Insured Municipal Income Fund, Inc.,
Nuveen Select Tax-Free Income Portfolio, Nuveen Select Tax-Free Income Portfolio
2, Nuveen Insured California Select Tax-Free Income Portfolio, Nuveen Insured
New York Select Tax-Free Income Portfolio, Nuveen Premium Income Municipal Fund
2, Inc., Nuveen Select Tax-Free Income Portfolio 3, Nuveen Select Maturities
Municipal Fund, Nuveen Insured California Premium Income Municipal Fund, Inc.,
Nuveen Arizona Premium Income Municipal Fund, Inc., Nuveen Insured Florida
Premium Income Municipal Fund, Nuveen Michigan Premium Income Municipal Fund,
Inc., Nuveen New Jersey Premium
S-4
<PAGE>
Income Municipal Fund, Inc., Nuveen Insured New York Premium Income Municipal
Fund, Inc., Nuveen Premium Income Municipal Fund 4, Inc., Nuveen Pennsylvania
Premium Income Municipal Fund 2, Nuveen Maryland Premium Income Municipal Fund,
Nuveen Virginia Premium Income Municipal Fund, Nuveen Massachusetts Premium
Income Municipal Fund, Nuveen Insured California Premium Income Municipal Fund
2, Inc., Nuveen Washington Premium Income Municipal Fund, Nuveen Georgia Premium
Income Municipal Fund, Nuveen Missouri Premium Income Municipal Fund, Nuveen
Connecticut Premium Income Municipal Fund, Nuveen North Carolina Premium Income
Municipal Fund, Nuveen California Premium Income Municipal Fund, Nuveen Insured
Premium Income Municipal Fund 2, all registered closed-end management investment
companies. These registered open-end and closed-end investment companies
currently have approximately $35 billion in securities under management. Nuveen
is a subsidiary of The John Nuveen Company which, in turn, is approximately 78%
owned by the St. Paul Companies, Inc. ("ST. PAUL"). St. Paul is located in St.
Paul, Minnesota and is principally engaged in providing property-liability
insurance through subsidiaries. Nuveen is a member of the National Association
of Securities Dealers, Inc. and the Securities Industry Association and has its
principal office located in Chicago (333 West Wacker Drive). Nuveen maintains 11
regional offices.
To help advisers and investors better understand and more efficiently use an
investment in the Trust to reach their investment goals, the Trust's sponsor,
John Nuveen & Co. Incorporated, may advertise and create specific investment
programs and systems. For example, such activities may include presenting
information on how to use an investment in the Trust, alone or in combination
with an investment in other mutual funds or unit investment trusts sponsored by
Nuveen, to accumulate assets for future education needs or periodic payments
such as insurance premiums. The Trust's sponsor may produce software or
additional sales literature to promote the advantages of using the Trust to meet
these and other specific investor needs.
The Sponsor offers a program of advertising support to registered
broker-dealer firms, banks and bank affiliates ("FIRMS") that sell Trust Units
or shares of Nuveen Open-End Mutual Funds (excluding money-market funds)
("FUNDS"). Under this program, the Sponsor will pay or reimburse the Firm for up
to one half of specified media costs incurred in the placement of advertisements
which jointly feature the Firm and the Nuveen Funds and Trusts. Reimbursements
to the Firm will be based on the number of the Firm's registered representatives
who have sold Fund Shares and/or Trust Units during the prior calendar year
according to an established schedule. Reimbursements under this program will be
made by the Sponsor and not by the Funds or Trusts.
S-5
<PAGE>
APPENDIX A
STANDARD & POOR'S EARNINGS AND DIVIDEND RANKINGS
FOR COMMON STOCKS
The investment process involves assessment of various factors--such as
products and industry position, corporate resources and financial policy--with
results that make some common stocks more highly esteemed than others. In this
assessment, Standard & Poor's believes that earnings and dividend performance is
the end result of the interplay of these factors and that, over the long run,
the record of this performance has a considerable bearing on relative quality.
The rankings, however, do not pretend to reflect all of the factors, tangible or
intangible, that bear on stock quality.
Relative quality of bonds or other debt, that is, degrees of protection for
principal and interest, called credit worthiness, cannot be applied to common
stocks, and therefore rankings are not to be confused with bond quality ratings
which are arrived at by a necessarily different approach.
Growth and stability of earnings and dividends are deemed key elements in
establishing Standard & Poor's earnings and dividend rankings for common stocks.
It should be noted, however, that the process also takes into consideration
certain adjustments and modifications deemed desirable in establishing such
rankings.
The major driver of these rankings is a computerized scoring system based on
per-share earnings and dividend records of the most recent ten years--a period
deemed long enough to measure significant time segments of secular growth, to
capture indications of basic changes in trend as they develop, and to encompass
the full peak-to-peak range of the business cycle. Basic scores are computed for
earnings and dividends, then adjusted as indicated by a set of predetermined
modifiers for growth, stability within long-term trend, and cyclicality.
Adjusted scores for earnings and dividends are then combined to yield a final
score.
In addition, the ranking system makes allowance for the fact that, in
general, corporate size imparts certain recognized advantages from an investment
standpoint. Conversely, minimum size limits (as measured by corporate revenues)
are set for the various rankings, but the system provides for exceptions when
the score reflects an outstanding earnings-dividend record.
The final score for each stock is measured against a scoring matrix
determined by analysis of the scores of a large and representative sample of
stocks. The range of scores in the array of this sample has been aligned with
the following ladder of rankings:
<TABLE>
<S> <C> <C> <C> <C> <C>
A+ Highest A- Above Average B- Lower
A High B+ Average C Lowest
B Below Average D In Reorganization
</TABLE>
NR signifies no ranking because of insufficient data or because the stock is
not amenable to the ranking process.
The rankings as determined above may be modified in some instances by
special considerations, such as natural disasters, massive strikes, and
non-recurring accounting adjustments.
A ranking is not a forecast of future market price performance, but is
basically an appraisal of past performance of earnings and dividends, and
relative current standing. These rankings must not be used as market
recommendations; a high-scoring stock may at times be so overpriced as to
justify its sale, while a low-scoring stock may be attractively priced for
purchase. Rankings based upon earnings and dividend records are no substitute
for complete analysis. They cannot take into account potential effects on
management
B-1
<PAGE>
changes, internal company policies not yet fully reflected in the earnings and
dividend record, public relations standing, recent competitive shifts, and a
host of other factors that may be relevant to market price or suitability.
B-2
<PAGE>
APPENDIX B
STANDARD & POOR'S CORPORATE RATINGS CRITERIA
A Standard & Poor's issue credit rating is a current opinion of the
creditworthiness of an obligor with respect to a specific financial obligations,
a specific class of financial obligations, or a specific financial program
(including ratings on medium-term note programs and commercial paper programs).
It takes into consideration the creditworthiness of guarantors, insurers, or
other forms of credit enhancement on the obligation and takes into account the
currency in which the obligation is denominated. The issue credit rating is not
a recommendation to purchase, sell, or hold a financial obligation, inasmuch as
it does not comment as to market price or suitability for a particular investor.
Issue credit ratings are based on current information furnished by the
obligors or obtained by Standard & Poor's from other sources it considers
reliable. Standard & Poor's does not perform an audit in connection with any
credit rating and may, on occasion, rely on unaudited financial information.
Credit ratings may be changed, suspended, or withdrawn as a result of changes
in, or unavailability of, such information, or based on other circumstances.
Issue credit ratings can be either long-term or short-term. Short-term
ratings are generally assigned to those obligations considered short-term in the
relevant market. In the U.S., for example, that means obligations with an
original maturity of no more than 365 days--including commercial paper.
Short-term ratings are also used to indicate the creditworthiness of an obligor
with respect to put features on long-term obligations. The result is a dual
rating, in which the short-term rating addresses the put feature, in addition to
the usual long-term rating. Medium-term notes are assigned long-term ratings.
LONG-TERM ISSUE CREDIT RATINGS
Issue credit ratings are based, in varying degrees, on the following
considerations:
1. Likelihood of payment--capacity and willingness of the obligor to
meet its financial commitment on an obligation in accordance with the terms
of the obligation;
2. Nature of and provisions of the obligation; and
3. Protection afforded by, and relative position of, the obligation in
the event of bankruptcy, reorganization, or other arrangement under the laws
of bankruptcy and other laws affecting creditors' rights.
The issue rating definitions are expressed in terms of default risk. As
such, they pertain to senior obligations of an entity. Junior obligations are
typically rated lower than senior obligations, to reflect the lower priority in
bankruptcy, as noted above. (Such differentiation applies when an entity has
both senior and subordinated obligations, secured and unsecured obligations, or
operating company and holding company
A-1
<PAGE>
obligations.) Accordingly, in the case of junior debt, the rating may not
conform exactly with the category definition.
<TABLE>
<C> <S>
"AAA" An obligation rated "AAA" has the highest rating assigned by Standard & Poor's. The
obligor's capacity to meet its financial commitment on the obligation is extremely
strong.
"AA" An obligation rated "AA" differs from the highest rated obligations only in small
degree. The obligor's capacity to meet its financial commitment on the obligation
is very strong.
"A" An obligation rated "A" is somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than obligations in higher rated
categories. However, the obligor's capacity to meet its financial commitment on the
obligation is still strong.
"BBB" An obligation rated "BBB" exhibits adequate protection parameters. However, adverse
economic conditions or changing circumstances are more likely to lead to a weakened
capacity of the obligor to meet its financial commitment on the obligation.
</TABLE>
Obligations rated "BB," "B," "CCC," "CC," and "C" are regarded as having
significant speculative characteristics. "BB" indicates the least degree of
speculation and "C" the highest. While such obligations will likely have some
quality and protective characteristics, these may be outweighed by large
uncertainties or major exposures to adverse conditions.
<TABLE>
<C> <S>
"BB" An obligation rated "BB" is less vulnerable to nonpayment than other speculative
issues. However, it faces major ongoing uncertainties or exposure to adverse
business, financial, or economic conditions which could lead to the obligor's
inadequate capacity to meet its financial commitment on the obligation.
"B" An obligation rated "B" is more vulnerable to nonpayment than obligations rated
"BB," but the obligor currently has the capacity to meet its financial commitment
on the obligation. Adverse business, financial, or economic conditions will likely
impair the obligor's capacity or willingness to meet its financial commitment on
the obligation.
"CCC" An obligation rated "CCC" is currently vulnerable to nonpayment, and is dependent
upon favorable business, financial, and economic conditions for the obligor to meet
its financial commitment on the obligation. In the event of adverse business,
financial, or economic conditions, the obligor is not likely to have the capacity
to meet its financial commitment on the obligation.
"CC" An obligation rated "CC" is currently highly vulnerable to nonpayment.
"C" The "C" rating may be used to cover a situation where a bankruptcy petition has
been filed or similar action has been taken, but payments on this obligation are
being continued.
"D" An obligation rated "D" is in payment default. The "D" rating category is used when
payments on an obligation are not made on the date due even if the applicable grace
period has not expired, unless Standard & Poor's believes that such payments will
be made during such grace period. The "D" rating also will be used upon the filing
of a bankruptcy petition or the taking of a similar action if payments on an
obligation are jeopardized.
Plus(+) or minus(-): The ratings from "AA" to "CCC" may be modified by the addition of a
plus or minus sign to show relative standing within the major rating categories.
r This symbol is attached to the ratings of instruments with significant noncredit
risks. It highlights risks to principal or volatility of expected returns which are
NOT addressed in the credit rating. Examples include: obligations linked or indexed
to equities, currencies, or commodities; obligations exposed to severe prepayment
risk--such as interest-only or principal-only mortgage securities; and obligations
with unusually risky interest terms, such as inverse floaters.
</TABLE>
A-2
<PAGE>
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- --------------------------------------------------------------------------------
NUVEEN UNIT TRUST, SERIES 4
and certain subsequent Series
STANDARD TERMS AND CONDITIONS OF TRUST
DATED: May 29, 1997
BETWEEN
JOHN NUVEEN & CO. INCORPORATED
Depositor,
and
THE CHASE MANHATTAN BANK,
Evaluator and Trustee
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
INDEX
ARTICLE I DEFINITIONS . . . . . . . . . . . . . . . . . . . 1
Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Business Day . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Capital Account. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Capital Distribution Date. . . . . . . . . . . . . . . . . . . . . . . 2
Certificate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Contract Securities. . . . . . . . . . . . . . . . . . . . . . . . . . 6
Deferred Sales Charge. . . . . . . . . . . . . . . . . . . . . . . . . 6
Depositor. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Distribution Agent . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Evaluation Time. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Evaluator. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
In Kind Distribution . . . . . . . . . . . . . . . . . . . . . . . . . 6
Income Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Income Distribution. . . . . . . . . . . . . . . . . . . . . . . . . . 7
Income Distribution Date . . . . . . . . . . . . . . . . . . . . . . . 7
Initial Date of Deposit. . . . . . . . . . . . . . . . . . . . . . . . 7
Mandatory Termination Date . . . . . . . . . . . . . . . . . . . . . . 7
Program Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Record Date. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Redemption Date. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Redemption Price . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Reserve Account. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Rollover Distribution. . . . . . . . . . . . . . . . . . . . . . . . . 7
Rollover Notification Date . . . . . . . . . . . . . . . . . . . . . . 8
Rollover Unitholder. . . . . . . . . . . . . . . . . . . . . . . . . . 8
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Special Redemption and Liquidation Period . . . . . . . . . . . . . . 8
Trust Indenture and Agreement or Trust Agreement . . . . . . . . . . . 8
Trust Fund or Trust. . . . . . . . . . . . . . . . . . . . . . . . . . 8
Trust Fund Evaluation. . . . . . . . . . . . . . . . . . . . . . . . . 8
Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Unitholder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Unit Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
ARTICLE II DEPOSIT OF SECURITIES, ACCEPTANCE OF TRUST, ISSUANCE
OF UNITS; FORM OF CERTIFICATES. . . . . . . . . . . 9
Section 2.01. Deposit of Securities . . . . . . . . . . . . . . 9
Section 2.02. Acceptance of Trust . . . . . . . . . . . . . . . 12
Section 2.03. Issuance of Units . . . . . . . . . . . . . . . . 12
Section 2.04. Form of Certificates. . . . . . . . . . . . . . . 13
-i-
<PAGE>
ARTICLE III ADMINISTRATION OF FUND. . . . . . . . . . . . . . . 13
Section 3.01. Certain Moneys to be Credited to Income Account . . 13
Section 3.02. Certain Moneys to be Credited to Capital Account. . 13
Section 3.03. Establishment of Reserve Account. . . . . . . . . . 14
Section 3.04. Certain Deductions and Distributions. . . . . . . . 14
Section 3.05. Statements and Reports. . . . . . . . . . . . . . . 17
Section 3.06. Extraordinary Sale of Securities. . . . . . . . . . 19
Section 3.07. Counsel . . . . . . . . . . . . . . . . . . . . . . 19
Section 3.08. Action by Trustee Regarding Securities. . . . . . . 19
Section 3.09. Notice of Change in Capital Account . . . . . . . . 20
Section 3.10. Limited Replacement of Special Securities . . . . . 20
Section 3.11. Compensation of Depositor for Supervisory Services 21
Section 3.12. Deferred Sales Charge . . . . . . . . . . . . . . . 22
Section 3.13. Bookkeeping and Administrative Expenses . . . . . . 23
ARTICLE IV EVALUATION OF SECURITIES; THE EVALUATOR . . . . . . 24
Section 4.01. Evaluation of Securities. . . . . . . . . . . . . . 24
Section 4.02. Certain Information to Be Made Available. . . . . . 25
Section 4.03. Compensation of the Evaluator . . . . . . . . . . . 25
Section 4.04. Liability of the Evaluator. . . . . . . . . . . . . 26
Section 4.05. Resignation, Removal and Other Matters Relating
to the Evaluator . . . . . . . . . . . . . . . . . 26
ARTICLE V TRUST FUND EVALUATION; REDEMPTION OF UNITS. . . . . 27
Section 5.01. Trust Fund Evaluation . . . . . . . . . . . . . . . 27
Section 5.02. Redemption of Units; Sale of Securities . . . . . . 28
Section 5.03. Rollover of Units . . . . . . . . . . . . . . . . . 30
ARTICLE VI ISSUANCE, TRANSFER, INTERCHANGE AND REPLACEMENT OF
CERTIFICATES. . . . . . . . . . . . . . . . . . . . 31
Section 6.01. Issuance of Certificates. . . . . . . . . . . . . . 31
Section 6.02. Transfer of Units; Interchange of Certificates. . . 31
Section 6.03. Replacement of Certificates . . . . . . . . . . . . 32
Section 6.04. Form of Certificate . . . . . . . . . . . . . . . . 33
ARTICLE VII DEPOSITOR . . . . . . . . . . . . . . . . . . . . . 33
Section 7.01. Certain Matters Regarding Succession. . . . . . . . 33
Section 7.02. Liability of Depositor and Indemnification. . . . . 33
ARTICLE VIII TRUSTEE . . . . . . . . . . . . . . . . . . . . . . 34
Section 8.01. General Matters Relating to the Trustee . . . . . . 34
Section 8.02. Books, Records and Reports. . . . . . . . . . . . . 36
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<PAGE>
Section 8.03. Reports to Securities and Exchange Commission and
Others. . . . . . . . . . . . . . . . . . . . . . . 37
Section 8.04. Agreement and List of Securities on File. . . . . . 37
Section 8.05. Compensation of Trustee . . . . . . . . . . . . . . 37
Section 8.06. Resignation, Discharge or Removal of the Trustee;
Successors. . . . . . . . . . . . . . . . . . . . . 38
Section 8.07. Qualification of Trustee. . . . . . . . . . . . . . 39
Section 8.08. Collateral. . . . . . . . . . . . . . . . . . . . . 39
ARTICLE IX TERMINATION . . . . . . . . . . . . . . . . . . . . 40
Section 9.01. Procedure Upon Termination. . . . . . . . . . . . . 40
Section 9.02. Notice to Unitholders . . . . . . . . . . . . . . . 41
Section 9.03. Moneys to be Held in Trust Without Interest . . . . 41
Section 9.04. Dissolution of Depositor Not to Terminate . . . . . 41
ARTICLE X MISCELLANEOUS PROVISIONS. . . . . . . . . . . . . . 42
Section 10.01. Amendment and Waiver. . . . . . . . . . . . . . . . 42
Section 10.02. Initial Costs . . . . . . . . . . . . . . . . . . . 42
Section 10.03. Registration (Initial and Current) of Units
and Fund . . . . . . . . . . . . . . . . . . . . . 43
Section 10.04. Certain Matters Relating to Unitholders . . . . . . 43
Section 10.05. New York Law to Govern. . . . . . . . . . . . . . . 44
Section 10.06. Notices . . . . . . . . . . . . . . . . . . . . . . 44
Section 10.07. Severability. . . . . . . . . . . . . . . . . . . . 44
Section 10.08. Separate and Distinct Series. . . . . . . . . . . . 45
Execution . . . . . . . . . . . . . . . . . . . . . . . . . . 46
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<PAGE>
NUVEEN UNIT TRUST, SERIES 4
AND CERTAIN SUBSEQUENT SERIES
STANDARD TERMS AND CONDITIONS OF TRUST
EFFECTIVE MAY 29, 1997
These Standard Terms and Conditions of Trust, Effective May 29, 1997, are
executed between John Nuveen & Co. Incorporated, as Depositor, and The Chase
Manhattan Bank, as Evaluator and Trustee.
WITNESSETH THAT:
In consideration of the premises and of the mutual agreements herein
contained, the Depositor, Evaluator and the Trustee agree as follows:
INTRODUCTION
These Standard Terms and Conditions of Trust shall be applicable to each
Series created on or subsequent to the date hereof of Nuveen Unit Trust for
which The Chase Manhattan Bank acts as Trustee as provided in this paragraph.
For each such series of Nuveen Unit Trust to which these Standard Terms and
Conditions of Trust are to be applicable, the Depositor, Evaluator and the
Trustee shall execute a Trust Indenture and Agreement incorporating by reference
these Standard Terms and Conditions of Trust and designating any exclusion from
or exception to such incorporation by reference for the purposes of that series
or variation of the terms hereof for the purposes of that series and specifying
for that series (i) the name of each Trust Fund and (ii) the Securities
deposited in trust for each Trust Fund.
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
AGREEMENT
These Standard Terms and Conditions of Trust and all amendments and supplements
hereto and thereto.
<PAGE>
BUSINESS DAY
Any day other than a Saturday, Sunday, a day on which the New York Stock
Exchange is closed or, with respect to payments or settlements, in the City of
New York, a day on which banking institutions are authorized by law to close.
CAPITAL ACCOUNT
The account created pursuant to Section 3.02.
CAPITAL DISTRIBUTION DATE
The meaning assigned to it in the Prospectus for each respective Trust
under the caption "Income and Capital Account Distribution Dates" appearing in
the "Summary of Essential Financial Information."
CERTIFICATE
Any one of the Certificates manually executed by the Trustee in
substantially the following form with the blanks appropriately filled in:
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<PAGE>
No. CERTIFICATE OF OWNERSHIP Units
---- -----
Description of Trust Plan of Distribution
------
CUSIP
-----------------
This is to certify that _______________________________________ is the
owner and registered holder of this Certificate evidencing the ownership of
________________ units of undivided interest in the above-named Trust created
pursuant to the Trust Indenture and Agreement between John Nuveen & Co.
Incorporated and The Chase Manhattan Bank (the "TRUSTEE"), a copy of which is
available at the office of the Trustee. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Indenture to which the
Holder of this Certificate by virtue of the acceptance hereof assents and is
bound, a summary of which Indenture is contained in the Prospectus relating to
the Trust. This Certificate is transferable and interchangeable by the
registered owner in person or by his duly authorized attorney at the Trustee's
office upon surrender of this Certificate properly endorsed or accompanied by a
written instrument of transfer and any other documents that the Trustee may
require for transfer, in form satisfactory to the Trustee and payment of the
fees and expense provided in the Indenture.
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IN WITNESS WHEREOF, John Nuveen & Co. Incorporated has caused this
Certificate to be executed in facsimile by its Chairman of the Board and The
Chase Manhattan Bank, as Trustee, has caused this Certificate to be executed in
facsimile in its corporate name by an authorized officer.
Date:
JOHN NUVEEN & CO. INCORPORATED,
Depositor
By
-------------------------------------
THE CHASE MANHATTAN BANK, Trustee
By
-------------------------------------
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FORM OF ASSIGNMENT
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - ____ Custodian _____
TEN ENT -as tenants by the entireties (Cust) (Minor)
JT TEN -as joint tenants with right Under Uniform Gifts to Minors Act
of survivorship and not
as tenants in common
------------------------------
State
Additional abbreviations may also be used though not in the above list.
For Value Received, ________________________________ hereby sell, assign and
transfer ____________ Units represented by this Certificate unto________________
SOCIAL SECURITY OR OTHER IDENTIFYING
NUMBER OF ASSIGNEE MUST BE PROVIDED
---------------------------------------
---------------------------------------
- --------------------------------------------------------------------------------
and does hereby irrevocably constitute and appoint
_____________________________________________________, attorney, to transfer
said Units on the books of the Trustee, with full power and substitution in the
premises.
Dated:
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NOTICE: The signature to this assignment must
correspond with the name as written upon the face of
the Certificate in every particular, without alteration
or enlargement or any change whatever.
SIGNATURE(S) GUARANTEED BY
- --------------------------------
Firm or Bank
- --------------------------------
Authorized Signature
Signatures must be guaranteed by a participant in the
Securities Transfer Agents Medallion Program ("STAMP")
or such other guarantee program in addition to, or in
substitution for, STAMP, as may be accepted by the Trustee.
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CONTRACT SECURITIES
The Securities listed in Schedule A of the Trust Agreement which are to be
acquired by any Trust Fund pursuant to a contract or contracts for the purchase
of such securities which have been assigned to the Trustee along with the
amounts required for their purchase which have been delivered to the Trustee or
Securities which the Depositor has contracted to purchase for any Trust Fund
pursuant to Section 3.10 hereof.
DEFERRED SALES CHARGE
The meaning assigned to it in Section 3.12.
DEPOSITOR
John Nuveen & Co. Incorporated or its successors or any successor Depositor
appointed as herein provided.
DISTRIBUTION AGENT
The Chase Manhattan Bank acting in its capacity as distribution agent
pursuant to Section 5.03.
EVALUATION TIME
That time stated in the Prospectus for each respective Trust Fund.
EVALUATOR
The Chase Manhattan Bank or its successors or any successor Evaluator
appointed as herein provided.
FUND
All Trust Funds outstanding under this Agreement.
IN KIND DISTRIBUTION
The meaning assigned to it in Section 5.02.
INCOME ACCOUNT
The account created pursuant to Section 3.01.
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INCOME DISTRIBUTION
The meaning assigned to it in Section 3.04.
INCOME DISTRIBUTION DATE
The meaning assigned to it in the Prospectus for each respective Trust
Fund.
INITIAL DATE OF DEPOSIT
The meaning assigned to it in the Prospectus for each respective Trust Fund
appearing in "Essential Information."
MANDATORY TERMINATION DATE
The meaning assigned to it in the Prospectus for each respective Trust Fund
under the caption "Mandatory Termination Date" appearing in the "Summary of
Essential Financial Information."
PROGRAM AGENT
Program Agent shall mean The Chase Manhattan Bank or its successors, unless
a different Program Agent shall be designated by the Trust Agreement for a
particular Trust Fund.
RECORD DATE
The meaning assigned to it in the Prospectus for each respective Trust
Fund.
REDEMPTION DATE
The meaning assigned to it in Section 5.02.
REDEMPTION PRICE
The meaning assigned to it in Section 5.02.
RESERVE ACCOUNT
The account created pursuant to Section 3.03.
ROLLOVER DISTRIBUTION
The meaning assigned to it in Section 5.03.
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ROLLOVER NOTIFICATION DATE
The meaning assigned to it in the Prospectus for each respective Trust Fund
under the caption "Rollover Notification Date" appearing in "Essential
Information."
ROLLOVER UNITHOLDER
The meaning assigned to it in Section 5.03.
SECURITIES
The equity securities, including Contract Securities listed in Schedule A
to the Trust Agreement or other securities deposited in the Trust Fund pursuant
to Section 2.01(b) and any obligations received in exchange or substitution for
such securities pursuant to Sections 3.08 or 3.10 hereof, as may from time to
time continue to be held as a part of any Trust Fund.
SPECIAL REDEMPTION AND LIQUIDATION PERIOD
The meaning assigned to it in the Prospectus for each respective Trust Fund
under the caption "Special Redemption and Liquidation Period" appearing in
"Essential Information."
TRUST INDENTURE AND AGREEMENT OR TRUST AGREEMENT
The Trust Indenture and Agreement for the particular series of Nuveen Unit
Trust into which these Standard Terms and Conditions of Trust are incorporated.
TRUST FUND OR TRUST
Any one of the separate trusts created by this Agreement and a Trust
Agreement which shall consist of the Securities and all undistributed dividends
or other amounts received thereon and any undistributed cash held in the Capital
and Income Accounts or otherwise realized from the sale, liquidation or exchange
thereof, exclusive of any amounts which may be on deposit in the Reserve
Account.
TRUST FUND EVALUATION
The meaning assigned to it in Section 5.01.
TRUSTEE
The Chase Manhattan Bank or its successors or any successor Trustee
appointed as herein provided.
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UNIT
The fractional undivided interest in and ownership of an individual Trust
Fund equal initially to the fraction specified in the Prospectus for each
respective Trust Fund under the caption "Fractional Undivided Interest per Unit"
appearing in "Essential Information," the denominator of which fraction shall
be (1) increased by the number of any additional Units issued pursuant to
Section 2.03 hereof and (2) decreased by the number of any such Units redeemed
as provided in Section 5.02. Whenever reference is made herein to the
"interest" of a Unitholder in the Trust Fund or in the Income or Capital
Accounts, it shall mean such fractional undivided interest represented by the
number of Units, whether or not evidenced by a Certificate or Certificates,
held of record by such Unitholder in such Trust Fund.
UNITHOLDER
The holder of any Unit as recorded on the books of the Trustee, his legal
representatives and heirs and the successors of any corporation, partnership or
other legal entity which is a holder of any Unit.
UNIT VALUE
The value of the fractional undivided interest in and ownership of any
individual Trust Fund represented by each Unit as determined by a Trust Fund
Evaluation.
Words importing a singular number shall include the plural number in each
case and vice versa, except as the context herein may clearly indicate
otherwise and words importing persons shall include corporations, partnerships
and associations, as well as natural persons. The words "herein," "hereby,"
"herewith," "heretofore," and other singular words or phrases or references and
associations shall refer to the Agreement in its entirety.
ARTICLE II
DEPOSIT OF SECURITIES, ACCEPTANCE OF TRUST, ISSUANCE OF UNITS; FORM
OF CERTIFICATES
SECTION 2.01. DEPOSIT OF SECURITIES. (a) The Depositor, concurrently
with the execution and delivery hereof, hereby grants and conveys all of its
right, title and interest in and to and hereby conveys to and deposits with the
Trustee in an irrevocable Trust the Securities and confirmations of contracts to
purchase Securities, including Contract Securities, listed in Schedule A to the
Trust Agreement duly endorsed in blank or accompanied by all necessary
instruments of assignment and transfer in proper form, to be held, managed and
applied by the Trustee as herein provided for the benefit of each Unitholder to
the extent of such Unitholder's interest in the Trust Fund. The Depositor
hereby also delivers to the Trustee a certified check or checks, cash or cash
equivalents or an irrevocable letter or letters of credit issued by a
commercial bank or banks in an amount necessary to consummate the purchase of
any Securities or Contract Securities. In the event
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any Securities have not been delivered to the Trustee on or before the close of
business of the Trustee on the day before the date of expiration of any letter
or letters of credit, the Trustee is hereby directed to draw on such letter or
letters of credit unless the Depositor has either extended or replaced such
letter or letters on or before such close of business.
(b) (1) From time to time following the Initial Date of Deposit for a
Trust, the Depositor is hereby authorized, in its discretion, to assign, convey
to and deposit with the Trustee (i) additional Securities for such Trust, duly
endorsed in blank or accompanied by all necessary instruments of assignment and
transfer in proper form, or (ii) Contract Securities relating to such additional
Securities, accompanied by cash and/or Letter(s) of Credit as specified in
paragraph (c) of this Section 2.01. In lieu of additional Securities or
Contract Securities, the Depositor may deposit with the Trustee cash (or a
Letter of Credit) in an amount equal to the valuation made in accordance with
Section 4.01 for the date of such deposit of the additional Securities not
delivered or represented by Contract Securities together with instructions to
purchase such additional Securities specifying the purchase price or price
range and containing such information as the Trustee may require to settle said
transactions. Except as provided in the following subparagraphs (2), (3) and
(4), the Depositor in each case shall ensure that each deposit of additional
Securities pursuant to this Section shall be, as nearly as is practicable,
equal to the original percentage relationship among the number of shares of
each Security as is specified in the Prospectus for such Trust Fund, adjusted
as hereinafter provided (the "PERCENTAGE RATIO"). The Percentage Ratio shall
be adjusted, as directed by the Depositor, to reflect (1) the deposit of New
Securities, (2) the sale of Securities pursuant to Sections 3.06, 3.08, 3.12,
5.02 or otherwise as provided hereunder, and (3) the occurrence of any stock
dividend, stock splits, receipt of securities under Section 3.08, redemptions,
or similar events. Any brokerage fees related to the purchase of Securities
deposited in the Trust Fund after the Initial Date of Deposit shall be an
expense of such Trust Fund. The Depositor shall deliver the additional
Securities which were not delivered concurrently with the deposit of additional
Securities and which were represented by Contract Obligations within 10
calendar days after such deposit of additional Securities (the "ADDITIONAL
SECURITIES DELIVERY PERIOD"). If a contract to buy such Securities between the
Depositor and seller is terminated by the seller thereof for any reason beyond
the control of the Depositor or if for any other reason such Securities are not
delivered to the Trust by the end of the Additional Securities Delivery Period
for such deposit, the Trustee shall immediately draw on the Letter of Credit,
if any, in amounts sufficient to settle such contract, apply the monies in
accordance with Section 2.01(d), and the Depositor shall forthwith take the
remedial action specified in Section 3.10. If the Depositor does not take the
action specified in Section 3.10 within 10 calendar days of the end of the
Additional Securities Delivery Period, the Trustee shall forthwith take the
action specified in Section 3.10. When requested by the Trustee, the Depositor
shall arrange for the execution of purchases in accordance with such
instructions; the Depositor shall be entitled to compensation therefor in
accordance with applicable law and regulations. The Trustee shall have no
liability for any loss or depreciation resulting from any purchase made
pursuant to the Depositor's instructions or made by the Depositor as broker.
(2) Additional Securities (or Contract Securities therefor) may, at the
Depositor's discretion, be deposited or purchased in round lots. If the amount
of the deposit is
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insufficient to acquire round lots of each Security to be acquired, the
additional Securities shall be deposited or purchased in the order of the
Security in the Trust most under-represented immediately before the deposit
with respect to the Percentage Ratio.
(3) If at the time of a deposit of additional Securities, Securities of an
issue deposited on the Initial Date of Deposit (or of an issue of Replacement
Securities acquired to replace an issue deposited on the Initial Date of
Deposit) are unavailable, cannot be purchased at reasonable prices or their
purchase is prohibited or restricted by applicable law, regulation or policies,
the Depositor may (i) deposit, or instruct the Trustee to purchase, in lieu
thereof, another issue of Securities or Replacement Securities or (ii) deposit
cash or a letter of credit in an amount equal to the valuation of the issue of
Securities whose acquisition is not feasible with instructions to acquire such
Securities of such issue when they become available.
(4) Any contrary authorization in the preceding subparagraphs (1) through
(3) notwithstanding, deposits of additional Securities made after the 90-day
period immediately following the Initial Date of Deposit (except for deposits
made to replace failed Contract Securities ("SPECIAL SECURITIES") if such
deposits occur within 20 days from the date of a failure occurring within such
initial 90-day period) shall maintain exactly the Percentage Ratio existing
immediately prior to such deposit.
(5) In connection with and at the time of any deposit of additional
Securities pursuant to this 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. For purposes of this paragraph, "CASH" means, as to the
Capital Account, cash or other property (other than Securities) on hand in the
Capital Account or receivable and to be credited to the Capital Account as of
the date of the 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 Securities) received by the Trust as
of the date of the deposit or receivable by the Trust in respect of a record
date for payment on a Security which has occurred or will occur before the
Trust will be the holder of record of a Security, reduced by (i) the amount of
any cash or other property received or receivable on any Security allocable (in
accordance with the Trustee's calculations of distributions from the Income
Account pursuant to Section 3.05) to a distribution made or to be made in
respect of a Record Date occurring prior to the deposit and (ii) unpaid fees
and expenses allocable to the period 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.
(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 Securities 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 allow the Depositor to substitute any Letter(s) of Credit
deposited
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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. 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 Securities or Contract Securities
pursuant to any contract shall not be consummated in accordance with said
contract or if the Securities represented by a Contract Obligation 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, and the Depositor does not, on or before the
third Business Day prior to the next following Distribution Date, direct the
Trustee to utilize monies deposited for the purchase of Replacement Securities
or Replacement Contract Securities, the Trustee shall credit to the Capital
Account referred to in Section 3.02 the monies, or, if applicable, the monies
drawn on an irrevocable letter of credit, deposited by the Depositor for the
purpose of such purchase. Such funds shall be distributed pursuant to Section
3.04 to Unitholders 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 Unitholder his pro rata portion of the sales charge levied on the sale of
Units to such Unitholder attributable to such Security or Contract Security.
(e) The Trustee is hereby irrevocably authorized to effect registration or
transfer of the Securities in fully registered form to the name of the Trustee
or to the name of its nominee.
(f) With respect to Units created by the deposit of additional
Securities, annual fees payable hereunder shall be calculated, and estimated
expenses (other than organizational expenses borne by the Trust Fund pursuant
to Section 10.02) shall be estimated, ratably on the basis of the period
during which such Units have been in existence. The Depositor shall from time
to time provide the Trustee estimates of the total number of additional
Securities to be deposited and total number of Units to be created, on which
the Trustee is authorized conclusively to rely for purposes of estimating
income, expenses and the accrual thereof. In the event the Trustee is
informed by the Depositor of a revision in its estimates and upon the
conclusion of the deposit of additional Securities, the Trustee shall base
calculations made thereafter on such revised estimates or actual expenses,
respectively, but any such revision shall not affect calculations made prior
thereto and no adjustment shall be made in respect thereof.
SECTION 2.02. ACCEPTANCE OF TRUST. The Trustee hereby accepts the
trusts herein created, and the Trustee declares that it holds and will hold the
Trust Fund as Trustee, in trust upon the trusts herein set forth, for the use
and benefit of the present and future Unitholders and subject to the terms and
conditions of the Trust Agreement and this Agreement.
SECTION 2.03. ISSUANCE OF UNITS. (a) The Trustee hereby acknowledges
receipt of the deposit of the Securities listed in Schedule A to the Trust
Agreement and referred to in Section 2.01 hereof and, simultaneously with the
receipt of said deposit, has recorded on its books the ownership, by the
Depositor or such other person or persons as may be indicated by the Depositor,
of the aggregate number of Units specified in the Trust Agreement. The number
of Units may be increased through a split of the Units or decreased through a
reverse split thereof, as directed in writing by the Depositor, at any time
when the Depositor is the only beneficial holder of Units, which revised number
of Units shall be recorded by the Trustee on its books. The Trustee shall be
entitled to rely on the Depositor's direction as certification that no person
other than the Depositor has a beneficial interest in the Units and
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the Trustee shall have no liability to any person for action taken pursuant to
such direction. The Trustee hereby agrees that on the date of any deposit of
additional Securities, it shall acknowledge that the additional Securities have
been deposited with it by recording on its books the ownership, by the
Depositor or such other person or persons as may be indicated by the Depositor,
of the aggregate number of Units to be issued in respect of such additional
Securities so deposited.
(b) Units will be held in uncertificated form unless the Trust Fund
Prospectus provides otherwise. Under the terms and conditions of the Trust
Agreement and this Agreement and at such times as are permitted by the Trustee,
Units may also be held in certificated form. Unitholders may elect to have
their Units held in certificated form by making a written request to the
Trustee requesting Units be held in certificated form. The Trustee is entitled
to specify the minimum denomination of any Certificate issued. The Trustee
shall, at the request of the holder of any Units held in uncertificated form,
issue a new Certificate to evidence such Units and at such time make an
appropriate notation in the registration books of the Trustee. The rights set
forth in this Agreement of any holder of Units held in certificated form shall
be the same as those of any other Unitholder. Certificates may be transferred
as provided in Article VI.
SECTION 2.04. FORM OF CERTIFICATES. Each Certificate referred to in
Section 2.03 is, and each Certificate hereafter issued shall be, in
substantially the form hereinabove recited, numbered serially for
identification, in fully registered form, transferable on the books of the
Trustee as herein provided, executed manually by an authorized signature of the
Trustee and by a facsimile signature of an Authorized Officer of the Depositor
and dated the date of execution and delivery by the Trustee.
ARTICLE III
ADMINISTRATION OF FUND
SECTION 3.01. CERTAIN MONEYS TO BE CREDITED TO INCOME ACCOUNT. The
Trustee shall collect any dividends or other like cash distributions on the
Securities in each Trust as such becomes payable (including all monies
representing penalties for the failure to make timely payments on the
Securities, or as liquidated damages for default or breach of any condition or
term of the Securities or of the underlying instrument relating to any
Securities and other income attributable to a Special Security for which no New
Security has been obtained pursuant to Section 3.10 hereof) and credit such
income to a separate account for each Trust to be known as the "INCOME ACCOUNT."
Any non-cash distributions (other than a non-taxable distribution of the
shares of the distributing corporations which shall be retained by a Trust)
received by a Trust shall be dealt with in the manner described at Section
3.08, herein, and shall be retained or disposed of by such Trust according to
those provisions. The proceeds of any disposition shall be credited to the
Income Account of a Trust. Neither the Trustee nor the Depositor shall be
liable or responsible in any way for depreciation or loss incurred by reason of
any such sale.
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SECTION 3.02. CERTAIN MONEYS TO BE CREDITED TO CAPITAL ACCOUNT. (a) With
respect to each Trust Fund all moneys (except moneys held by the Trustee
pursuant to subsection (b) hereof) other than amounts credited to the Income
Account received by the Trustee in respect of the Securities under this
Agreement shall be credited to a separate account for each Trust Fund to be
known as the "CAPITAL ACCOUNT."
(b) Moneys and/or irrevocable letters of credit required to purchase
Contract Securities or to purchase Securities pursuant to the Depositor's
written instructions, or deposited to secure such purchases, are hereby declared
to be held specially by the Trustee for such purchases and shall not be deemed
to be part of the Capital Account until (i) the Depositor fails to timely
purchase a Contract Security and has not given the Failed Contract Notice (as
defined in Section 3.10) at which time the moneys and/or letters of credit
attributable to the Contract Security not purchased by the Depositor shall be
credited to the Capital Account; or (ii) the Depositor has given the Trustee the
Failed Contract Notice at which time the moneys and/or letters of credit
attributable to failed contracts referred to in such Notice shall be credited to
the Capital Account; PROVIDED, HOWEVER, that if the Depositor also notifies the
Trustee in the Failed Contract Notice (or by separate notice delivered
concurrently with or prior to the Failed Contract Notice) that it has purchased
or entered into a contract to purchase a New Security (as defined in Section
3.10), the Trustee shall not credit such moneys and/or letters of credit to the
Capital Account unless the New Security shall also have failed or is not
delivered by the Depositor within two business days after the settlement date of
such New Security, in which event the Trustee shall forthwith credit such moneys
and/or letters of credit to the Capital Account. The Depositor shall in any
case forthwith pay to the Trustee and the Trustee shall credit to the Capital
Account the difference, if any, between the purchase price of the failed
Contract Security and the purchase price of the New Security, together with any
sales charge and distribute such moneys to Unitholders pursuant to Section 3.04.
SECTION 3.03. ESTABLISHMENT OF RESERVE ACCOUNT. From time to time the
Trustee may withdraw from the Income or Capital Accounts of each Trust Fund such
amounts as it, in its sole discretion, shall deem requisite to establish a
reserve for any applicable taxes or other governmental charges that may be
payable out of such Trust Fund or for indemnification or extraordinary expenses
of the Depositor or Trustee pursuant to Section 7.02, 8.01 or 8.05. Such
amounts so withdrawn shall be credited to a separate account for such Trust Fund
which shall be known as the "RESERVE ACCOUNT." The Trustee shall not be
required to distribute to the Unitholders any of the amounts in the Reserve
Account; PROVIDED, HOWEVER, that if it, in its sole discretion, determines that
such amounts are no longer necessary, then it shall promptly deposit such
amounts in the account from which withdrawn, or if such Trust Fund has been
terminated or shall be in the process of termination, the Trustee, upon such
determination, shall distribute to each Unitholder of such Trust Fund such
holder's interest in the Reserve Account in accordance with Section 9.01.
SECTION 3.04. CERTAIN DEDUCTIONS AND DISTRIBUTIONS. (a) On each Record
Date, or at such earlier time as may be specified in the Prospectus, the Trustee
shall separately with respect to each Trust Fund:
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(1) deduct from the Income Account or, to the extent funds are not
available in such Account, from the Capital Account and pay to itself
individually the amounts that it is at the time entitled to receive pursuant
to Section 8.05 on account of its services theretofore performed and
expenses theretofore incurred;
(2) deduct from the Income Account, or, to the extent funds are not
available in such Account, from the Capital Account, and reimburse itself
for any other fees, advances and expenses arising from time to time out of
the Trust operations that the Trustee has paid;
(3) deduct from the Income Account or, to the extent funds are not
available in such Account, from the Capital Account and pay to the
Evaluator the amounts that the Evaluator is at the time entitled to receive
pursuant to Section 4.03 on account of its services theretofore performed
and expenses theretofore incurred;
(4) deduct from the Income Account or, to the extent funds are not
available in such Account, from the Capital Account and pay to counsel an
amount equal to unpaid fees and expenses, if any, of counsel pursuant to
Section 3.07 as certified by the Depositor;
(5) deduct from the Income Account, or, to the extent funds are not
available in such Account, from the Capital Account and pay to the
Depositor the amounts that the Depositor is at the time entitled to receive
pursuant to Section 3.11 on account of its services theretofore performed
and expenses theretofore incurred; and
(6) deduct from the Income Account or, to the extent funds are not
available in such Account, from the Capital Account and pay to the
Depositor the amount that it is entitled to receive pursuant to Section
3.13.
(b) The Trustee shall for each Trust Fund as of the close of business on
the applicable Record Date compute the amount of the income distribution per
Unit for the next Income Distribution Date (each such amount being herein called
the "INCOME DISTRIBUTION") (i) by deducting from the amount actually received
with respect to dividends on the Securities in the Trust Fund during the period
from the Record Date preceding such Record Date (or the Initial Date of Deposit
if such Record Date is the first Record Date) to and including such Record Date
the total of (x) the amounts to be deducted from the Income Account of such
Trust Fund as of such Record Date pursuant to the foregoing provisions of
Section 3.04(a) and (y) the Trustee's estimate of other expenses properly
chargeable to the Income Account pursuant to the Indenture which have accrued,
as of such Record Date, or are otherwise properly attributable to the period to
which such Income Distribution relates and (ii) by dividing the result of the
calculation performed pursuant to the immediately preceding clause by the number
of Units outstanding on the applicable Record Date. On or shortly after each
Income Distribution Date, the Trustee shall distribute with respect to each
Unitholder of the Trust Fund of record at the close of business on the preceding
Record Date an amount substantially equal to the Income Distribution computed as
of such Record Date.
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To the extent that moneys in the Capital Account have not been previously
used to pay for the redemption of Units tendered to a Trust Fund, on the Capital
Distribution Dates each Unitholder shall receive such holder's pro rata share of
the cash balance of the Capital Account of the Trust Fund computed as of the
close of business on the preceding Record Date for such Capital Distribution
Date by (i) deducting from such cash balance the total of (X) cash required to
cover contracts to purchase Securities, (Y) cash required for the redemption of
unredeemed tendered Units and (Z) the sum of the amounts to be deducted from the
Capital Account as of each such Record Date pursuant to the foregoing provisions
of Section 3.04(a) and (ii) dividing the amount so obtained by the number of
Units outstanding on the Record Date immediately preceding such Capital
Distribution Date.
In making the computation of any Unitholder's interest in the balance of
the Income and Capital Accounts, fractions of less than one cent per Unit shall
be omitted. In addition, the Trustee in its discretion may on any Distribution
Date determine that the amount to be distributed to Unitholders should be more
or less than the amount of the applicable Income or Capital Distribution per
Unit because of any unusual or extraordinary increase or decrease in the
expenses incurred or expected to be incurred by such Trust Fund. The Trustee
shall not be obligated to make a distribution from the Capital Account if the
amount available for such distribution is less than $1.00 per 100 Units. When
directed by the Depositor, the Trustee shall invest funds held in the Capital or
Income Accounts, pending distribution, in money market mutual funds or U.S.
Treasury obligations which mature on or before the next applicable distribution
date. Any obligations so acquired must be held until they mature and proceeds
therefrom may not be reinvested.
(c) If the Depositor fails to replace any failed Special Security (as
defined in Section 3.10), the Trustee shall distribute to all Unitholders the
moneys originally deposited with respect to such Special Security and, to the
extent supplied by the Depositor, the sales charge attributable to such Special
Security not more than 30 days after the expiration of the Purchase Period (as
defined in Section 3.10). If any contract for a New Security in replacement of
a Special Security shall fail, the Trustee shall distribute the moneys
originally deposited with respect to such Special Security and, to the extent
provided by the Depositor, the sales charge attributable to the Special Security
to the Unitholders not more than 30 days after the date on which the contract in
respect of such New Security failed. If at the end of the Purchase Period less
than all moneys attributable to a failed Special Security have been applied or
allocated by the Trustee pursuant to a contract to purchase New Securities, the
Trustee shall distribute the remaining moneys (i) to Unitholders not more than
30 days after the end of the Purchase Period to the extent the failed Special
Security has not been fully replaced by New Securities or (ii) to the Depositor
to the extent moneys remain after the purchase of the New Securities, if any,
and the distribution referred to in clause (i).
(d) Except as provided below, all distributions shall be made by first
class mail to each Unitholder of record at the close of business on the
preceding applicable Record Date at the address of such holder appearing on the
registration books of the Trustee PROVIDED, HOWEVER, that the Trustee shall if
so directed with respect to distributions from the Income and/or Capital Account
at the time of purchase of Units or thereafter in writing signed by the
Unitholder and timely received, make such distributions to the Program Agent. A
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Unitholder's written notice must be received by the Program Agent at least ten
days prior to the Record Date for the next Income Distribution in order to be in
effect for such Income Distribution. All such notices shall remain in effect
until a subsequent notice is received by the Program Agent. Upon receipt of any
such distribution the Program Agent shall, if the respective Trust Prospectus so
provides, either (1) reinvest such Unitholder's distribution from the Income
and/or Capital Accounts in Units of the Trust, purchased from the Depositor, to
the extent the Depositor shall make Units available for such purchase, at the
Depositor's offering price as of the third business day prior to the following
Distribution Date, and at such reduced sales charge as may be described in the
Prospectus for the Trusts or (2) purchase shares (or fractions thereof) in the
applicable reinvestment fund as directed by the Unitholder. If, for any reason,
the Depositor does not have Units of the Trust available for purchase, the
Trustee shall distribute such Unitholder's distributions from the Income and/or
Capital Accounts in the manner provided in the first sentence of this Section
3.04(d). The Program Agent shall not be liable to any Unitholder for any action
taken with respect to its duties and responsibilities as Program Agent; or for
any failure to make such reinvestment in the event the Depositor does not make
Units available for purchase PROVIDED, HOWEVER, that this provision shall not
protect the Program Agent against liability to which it would otherwise be
subject by reason of wilful misfeasance, bad faith or gross negligence in the
performance of its duties or by reason of its reckless disregard of its
obligations and duties hereunder.
(e) Except as provided by the preceding paragraph, Unitholders of record
on the registration books of the Trustee at the close of business on the Record
Date prior to each Distribution Date, shall be entitled to the distribution in
respect of such Distribution Date, and, except as provided in Article VIII, no
liability shall attach to the Trustee by reason of payment to or on the order of
any such Unitholder of record. Nothing herein shall be construed to prevent the
payment of distributions from the Income and Capital Accounts to any such
Unitholder by means of one check, draft or other proper instrument.
SECTION 3.05. STATEMENTS AND REPORTS. With each distribution from the
Income or Capital Accounts of each Trust Fund the Trustee shall set forth,
either in the instrument by means of which payment of such distribution is made
or in an accompanying statement, the amount being distributed from each such
account expressed as a dollar amount per Unit of such Trust Fund. If the
distribution is an In Kind Distribution, the Trustee shall provide a list of the
Securities being distributed, the aggregate number of shares of each Security
being distributed and any cash representing fractional shares being
distributed.; Within a reasonable period of time after the last business day of
each calendar year, the Trustee shall furnish to each person who at any time
during such calendar year was a Unitholder of any individual Trust Fund a
statement for such Trust Fund setting forth with respect to such calendar year:
(A) as to the Income Account:
(1) the amount of dividends received on the Securities;
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(2) the amounts paid for purchases of New Securities pursuant to
Section 3.10 and for redemptions pursuant to Section 5.02;
(3) the deductions for applicable taxes and fees and expenses of
the Trust;
(4) the reservations made by the Trustee pursuant to Section
3.03, if any; and
(5) the balance remaining after such distributions, deductions
and reservations expressed both as a total dollar amount and as a
dollar amount per Unit outstanding on the last business day of such
calendar year;
(B) as to the Capital Account:
(1) the dates of sale or liquidation of any of the Securities
and the net proceeds received therefrom (excluding any portion thereof
credited to the Income Account);
(2) the results of In Kind Distributions in connection with
redemptions of Units, if any;
(3) the amounts paid for purchases of New Securities pursuant to
Section 3.10 and for redemptions pursuant to Section 5.02;
(4) the deductions for payment of applicable taxes and fees and
expenses of the Trust;
(5) the reservations made by the Trustee pursuant to Section
3.03, if any; and
(6) the balance remaining after such distributions, deductions
and reservations, expressed both as a total dollar amount and as a
dollar amount per Unit outstanding on the last business day of such
calendar year; and
(C) the following information:
(1) a list of the Securities as of the last business day of such
calendar year;
(2) the number of Units outstanding on the last business day of
such calendar year;
(3) the Unit Value based on the Trust Fund Evaluations made on
the last day of December (or the last business day prior thereto) of
such calendar year; and
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(4) the amounts actually distributed to Unitholders during such
calendar year from the Income and Capital Accounts, separately stated,
expressed both as total dollar amounts and as dollar amounts per Unit
outstanding on the Record Dates for such distributions.
SECTION 3.06. EXTRAORDINARY SALE OF SECURITIES. The Depositor by written
notice may direct the Trustee to sell Securities at such price and time and in
such manner as shall be deemed appropriate by the Depositor if the Depositor
shall have determined that any one or more of the following conditions exist:
(a) that there has been a default in the payment of principal of or
interest on any outstanding debt obligations of the issuer of such
Securities; or
(b) that the price of any such Security has declined to such an
extent, as a result of adverse issuer credit factors, so that in the
opinion of the Depositor the retention of such Securities would be
detrimental to the interest of the Unitholders.
Upon receipt of such direction from the Depositor, the Trustee shall
proceed to sell the specified Securities. The Trustee shall not be liable or
responsible in any way for depreciation or loss incurred by reason of any sale
made pursuant to any such direction or by reason of the failure of the Depositor
to give any such direction, and in the absence of such direction the Trustee
shall have no duty to sell any Securities under this Section 3.06. The
Depositor shall not be liable for errors of judgment in directing or failing to
direct the Trustee pursuant to this Section 3.06. This provision, however,
shall not protect the Trustee or Depositor against any liability for which they
would otherwise be subject, respectively, by reason of wilful misfeasance, bad
faith or gross negligence in the performance of their duties or by reason of
their reckless disregard of their obligations and duties hereunder.
SECTION 3.07. COUNSEL. The Depositor may employ from time to time counsel
to act on behalf of any Trust Fund for any legal services in connection with the
Securities, and any legal matters relating to the possible disposition of any
Securities pursuant to any provisions hereof. The fees and expenses of such
counsel shall be paid by the Trustee as provided in Section 3.04(a)(3) hereof.
SECTION 3.08. ACTION BY TRUSTEE REGARDING SECURITIES. In the event that
the Trustee shall have been notified at any time of any action to be taken or
proposed to be taken by holders of the Securities the Trustee shall promptly
notify the Depositor and shall thereupon take such action or refrain from taking
any action as the Depositor shall in writing direct; PROVIDED, HOWEVER, that if
the Depositor shall not within five business days of the giving of such notice
to the Depositor direct the Trustee to take or refrain from taking any action,
the Trustee shall take such action as it, in its sole discretion, shall deem
advisable. In connection with any solicitation of proxies by management of any
of the Securities in the Trust Fund, if the Depositor fails to instruct the
Trustee how to vote such proxy, the Trustee shall vote with the recommendation
of such management. Except as provided in Article VII and Article VIII, neither
the Depositor nor the Trustee shall be liable to any person for any action or
failure to take action with respect to this Section 3.08.
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In the event that an offer by the issuer of any of the Securities or any
other party shall be made to issue new securities, or to exchange securities,
for Trust Securities, the Trustee shall reject such offer. However, should any
issuance, exchange or substitution be effected notwithstanding such rejection or
without an initial offer, any securities, cash and/or property received shall be
promptly sold, if securities or property, by the Trustee pursuant to the
Depositor's direction, unless the Depositor advises the Trustee to keep such
securities or property. The cash received in such exchange and cash proceeds of
any such sales shall be distributed to Unitholders on the next distribution date
in the manner set forth in Section 3.04(b) regarding distributions from the
Capital Account. Except as provided in Article VIII, the Trustee shall not be
liable or responsible in any way for depreciation or loss incurred by reason of
any such sale.
Any non-cash distributions (other than a non-taxable distribution of the
shares of the distributing corporation which shall be retained by a Trust)
received by a Trust shall be dealt with in the manner described above and shall
be retained or disposed of according to such provisions.
Neither the Depositor nor the Trustee shall be liable to any person for any
action or failure to take action pursuant to the terms of this Section 3.08.
Whenever new securities or property is received and retained by a Trust
Fund pursuant to this Section 3.08, the Trustee shall, within a reasonable
amount of time thereafter, mail to all Unitholders of such Trust Fund notices of
such acquisition unless legal counsel for such Trust Fund determines that such
notice is not required by The Investment Company Act of 1940, as amended.
SECTION 3.09. NOTICE OF CHANGE IN CAPITAL ACCOUNT. The Trustee shall give
prompt written notice to the Depositor and the Evaluator of all amounts credited
to or withdrawn from the Capital Account of any Trust Fund pursuant to any of
the provisions of this Article III and the balance in such Account after giving
effect to the credit or withdrawal.
SECTION 3.10. LIMITED REPLACEMENT OF SPECIAL SECURITIES. If any contract
in respect of Contract Securities other than a contract to purchase a New
Security (as defined below), including those purchased on a delayed delivery
basis, shall have failed due to any occurrence, act or event beyond the control
of the Depositor or the Trustee (such failed Contract Securities being herein
called the "SPECIAL SECURITIES"), the Depositor shall notify the Trustee (such
notice being herein called the "FAILED CONTRACT NOTICE") of its inability to
deliver the failed Special Security to the Trustee after it is notified that the
Special Security will not be delivered by the seller thereof to the Depositor.
Prior to, or simultaneously with, giving the Trustee the Failed Contract Notice,
or within a maximum of 20 days after giving such Failed Contract Notice (such 20
day period being herein called the "PURCHASE PERIOD"), the Depositor shall, if
possible, purchase, or enter into a contract to purchase, an obligation to be
held as a Security hereunder (herein called the "NEW SECURITY") as part of the
Trust Fund in replacement of the failed Special Security, subject to the
satisfaction of all of the following conditions in the case of each purchase or
contract to purchase:
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(a) The New Securities shall be equity securities and shall, in
the opinion of the Depositor, be of the same general quality as those
Securities originally deposited.
(b) The purchase price of the New Securities shall not exceed the
amount of funds reserved for the purchase of the Special Securities.
(c) The Depositor shall furnish a notice to the Trustee (which may be
part of the Failed Contract Notice) in respect of the New Security
purchased or to be purchased that shall (i) identify the New Securities,
(ii) state that the contract to purchase, if any, entered into by the
Depositor is satisfactory in form and substance and (iii) state that the
foregoing conditions of clauses (a) and (b) have been satisfied with
respect to the New Securities.
Upon satisfaction of the foregoing conditions with respect to any New
Security, the Trustee shall pay the purchase price for the New Security from the
amount of funds reserved for the purchase of the Special Securities or, if the
Trustee has credited any moneys and/or letters of credit attributable to the
failed Special Security to the Capital Account, the Trustee shall pay the
purchase price of the New Security upon directions from the Depositor from the
moneys and/or letters of credit so credited to the Capital Account. If the
Trustee has credited moneys of the Depositor to the Capital Account, the Trustee
shall forthwith return to the Depositor the portion of such moneys that is not
properly distributable to Unitholders pursuant to Section 3.04.
Whenever a New Security is acquired by the Depositor pursuant to the
provisions of this Section 3.10, the Trustee shall, within five days thereafter,
mail to all Unitholders notices of such acquisition, including an identification
of the failed Special Securities and the New Securities acquired. The purchase
price of the New Securities shall be paid out of the funds reserved for the
purchase of the failed Special Securities. Except as provided in Article VIII,
the Trustee shall not be liable or responsible in any way for depreciation or
loss incurred by reason of any purchase made pursuant to any such directions and
in the absence of such directions the Trustee shall have no duty to purchase any
New Securities under this Agreement. The Depositor shall not be liable for any
failure to instruct the Trustee to purchase any New Securities or for errors of
judgment in respect of this Section 3.10; PROVIDED, HOWEVER, that this provision
shall not protect the Depositor against any liability to which it would
otherwise be subject by reason of wilful misfeasance, bad faith or negligence in
the performance of its duties or by reason of its reckless disregard of its
obligations and duties hereunder.
SECTION 3.11. COMPENSATION OF DEPOSITOR FOR SUPERVISORY SERVICES. As
compensation for providing supervisory portfolio services under this Agreement,
the Depositor shall receive at the time specified in Section 3.04, against a
statement or statements therefor submitted to the Trustee, an aggregate annual
fee if so provided and in the amount specified as compensation for the Depositor
in the Prospectus, calculated on the basis of the largest number of Units
outstanding during the period in respect of which such compensation is paid, but
in no event shall such compensation when combined with all compensation received
from other series of the Fund or other unit investment trusts sponsored by the
Depositor or
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its affiliates for providing such supervisory services in any calendar year
exceed the aggregate cost to the Depositor for providing such services. The
rate of such compensation may be increased by the Depositor from time to time,
without the consent or approval of any Unitholder or the Trustee, by amounts not
exceeding the proportionate increase, during the period from the date of the
Trust Agreement to the date of any such increase, in consumer prices as last
published prior to each such date under the classification "All Services Less
Rent of Shelter" in the Consumer Price Index For All Urban Consumers (CPI-U)
U.S. City Average, not seasonally adjusted, base 1982 - 84 = 100, published by
the United States Department of Labor. In the event that such classification
ceases to incorporate a significant number of items, or if a substantial change
is made in the method of establishing such classification, then the
classification shall be adjusted in a fair and reasonable manner to the figure
that would have resulted had no substantial change occurred in the manner of
computing such classification. In the event that such classification (or a
successor or substitute index) is not available, such governmental or other
service or publication as shall evaluate the information in substantially the
same manner as the aforesaid classification, shall be used in lieu thereof.
Such compensation shall be charged by the Trustee, upon receipt of invoice
therefor from the Depositor, against the Income and Capital Accounts on or
before the Distribution Date on which such period terminates. If the cash
balance in the Income and Capital Accounts shall be insufficient to provide for
amounts payable pursuant to this Section 3.11, the Trustee shall have the power
to sell (i) Securities from the current list of Securities designated to be sold
pursuant to Section 5.02 hereof, or (ii) if no such Securities have been so
designated, such Securities 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 3.11. Any moneys payable to the Depositor
pursuant to this Section 3.11 shall be secured by a prior lien on the Trust Fund
except that such lien shall be junior and subordinate to any lien in favor of
the Trustee under the provisions of Section 8.08 and of the Evaluator under the
provisions of Section 4.03.
SECTION 3.12. DEFERRED SALES CHARGE. If the Prospectus related to the
Trust specifies a deferred sales charge, the Trustee shall, on the dates
specified in and as permitted by such Prospectus (the "DEFERRED SALES CHARGE
PAYMENT DATES"), withdraw from the Capital Account, an amount per Unit specified
in such Prospectus and credit such amount to a special non-Trust account
designated by the Depositor out of which the deferred sales charge will be
distributed to or on the order of the Depositor on such Deferred Sales Charge
Payment Dates (the "DEFERRED SALES CHARGE ACCOUNT"). If the balance in the
Capital Account is insufficient to make such withdrawal, the Trustee shall, as
directed by the Depositor, advance funds in an amount required to fund the
proposed withdrawal and be entitled to reimbursement of such advance upon the
deposit of additional monies in the Capital Account, and/or sell Securities and
credit the proceeds thereof to the Deferred Sales Charge Account, PROVIDED,
HOWEVER, that the aggregate amount advanced by the Trustee at any time for
payment of the deferred sales charge shall not exceed $15,000. Such direction
shall, if the Trustee is directed to sell a Security, identify the Security to
be sold and include instructions as to the execution of such sale. In the
absence of such direction by the Depositor, the Trustee shall sell Securities
sufficient to pay the deferred sales charge (and any unreimbursed advance then
outstanding) in full, and shall select Securities to be sold in such manner as
will maintain (to the extent practicable) the relative proportion of number of
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shares of each Security then held. The proceeds of such sales, less any amounts
paid to the Trustee in reimbursement of its advances, shall be credited to the
Deferred Sales Charge Account. If a Unitholder redeems Units prior to full
payment of the deferred sales charge, the Trustee shall, if so provided in the
related Prospectus, on the Redemption Date, withhold from the Redemption Price
payable to such Unitholder an amount equal to the unpaid portion of the deferred
sales charge and distribute such amount to the Deferred Sales Charge Account.
If the Trust is terminated for reasons other than that set forth in Section
8.01(g)(ii), the Trustee shall, if so provided in the related Prospectus, on the
termination of the Trust, withhold from the proceeds payable to Unitholders an
amount equal to the unpaid portion of the deferred sales charge and distribute
such amount to the Deferred Sales Charge Account. If the Trust is terminated
pursuant to Section 8.01(g)(ii), the Trustee shall not withhold from the
proceeds payable to Unitholders any amounts of unpaid deferred sales charges.
If pursuant to Section 5.02 hereof, the Depositor shall purchase a Unit tendered
for redemption prior to the payment in full of the deferred sales charge due on
the tendered Unit, the Depositor shall pay to the Unitholder the amount
specified under Section 5.02 less the unpaid portion of the deferred sales
charge. All advances made by the Trustee pursuant to this Section shall be
secured by a lien on the Trust prior to the interest of the Unitholders.
SECTION 3.13. BOOKKEEPING AND ADMINISTRATIVE EXPENSES;. If so provided in
the Prospectus, 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 Depositor for providing supervisory services, the Depositor shall receive at
the times specified in Section 3.04, against a statement or statements therefor
submitted to the Trustee an aggregate annual fee in an amount which shall not
exceed that amount set forth in the Prospectus times the largest number of Units
outstanding during the period in respect of which the compensation is paid (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 series of
the Fund or other unit investment trusts sponsored by the Depositor or its
affiliates for providing such bookkeeping and administrative services in any
calendar year exceed the aggregate cost to the Depositor for providing such
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, during the
period from the Trust Agreement to the date of any such increase, 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 as described under Section 3.11. The consent or concurrence of any
Unitholder hereunder shall not be required for any such adjustment or increase.
Such compensations 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 Income and Capital Accounts on or before the Distribution
Date following the Record Date on which such period terminates. The Trustee
shall have no liability to any Unitholder or other person for any payment made
in good faith pursuant to this Section.
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If the cash balance in the Income and Capital Accounts shall be
insufficient to provide for amounts payable pursuant to this Section 3.13, the
Trustee shall have the power to sell (i) Securities from the current list of
Securities designated to be sold pursuant to Section 5.02 hereof, or (ii) if no
such Securities have been so designated, such Securities 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 3.13.
Any moneys payable to the Depositor pursuant to this Section 3.13 shall be
secured by a prior lien on the Trust except that no such lien shall be prior to
any lien in favor of the Trustee under the provisions of Section 8.08 and of the
Evaluator under the provisions of Section 4.03.
ARTICLE IV
EVALUATION OF SECURITIES; THE EVALUATOR
SECTION 4.01. EVALUATION OF SECURITIES. The Evaluator shall determine
separately and promptly furnish to the Trustee and the Depositor upon request
the value of each issue of Securities as of the Evaluation Time as provided in
the following manner:
The Evaluator will prepare each evaluation for which market quotations for
the Securities are available by the use of outside services normally used and
contracted with for this purpose. If the Securities are listed on a national
securities exchange or the NASDAQ National Market System, the evaluation will be
based on the closing sale price on the exchange or system or, if there is no
closing sale price on the exchange or system, at the closing bid price on the
exchange or system. If such market quotations are not available, the Evaluator
shall determine the value of the Securities. Such evaluation shall generally be
based on the current bid prices on the over-the-counter market (unless it is
determined that these prices are inappropriate as a basis for evaluation). If
such prices are not available on the over-the-counter market, the evaluation
will generally be made by the Evaluator in good faith (1) on the basis of the
current bid prices for comparable securities, (2) by the Evaluator's appraising
the value of the Securities in good faith at the bid side of the market or (3)
by any combination thereof. For each evaluation, the Evaluator shall also
determine and furnish to the Trustee and the Depositor the aggregate of (a) the
value of all Securities on the basis of such evaluation and (b) on the basis of
the information furnished to the Evaluator by the Trustee pursuant to Section
3.02, the amount of cash then held in the Capital Account which was received by
the Trustee after the Record Date preceding such determination less any amounts
held in the Capital Account for distribution to Unitholders on a subsequent
Distribution Date when a Record Date occurs four business days or less after
such determination. For the purposes of the foregoing, the Evaluator may obtain
current prices for the Securities from investment dealers or brokers (including
the Depositor) that customarily deal in similar securities. With respect to any
Security which is not listed on a national exchange or the Nasdaq National
Market System, upon the Evaluator's request, the Depositor shall, from time to
time, designate one or more reporting services or other sources of information
on which the Evaluator shall be authorized conclusively to rely in evaluating
such Security, and the Evaluator shall have no liability for any errors in the
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information so received. The cost thereof shall be an expense reimbursable to
the Evaluator from the Income and Capital Accounts.
SECTION 4.02. CERTAIN INFORMATION TO BE MADE AVAILABLE. For the purpose
of permitting Unitholders to satisfy any reporting requirements of applicable
federal or state tax law, the Evaluator shall make available to the Trustee and
the Trustee shall transmit to any Unitholder upon request any evaluations
pursuant to Section 4.01 which concern the Trust Fund in which such Unitholder
holds Units.
SECTION 4.03. COMPENSATION OF THE EVALUATOR. As compensation for its
services hereunder, the Evaluator shall receive at the times specified in
Section 3.04 against a statement therefor submitted to the Trustee on or before
each Distribution Date the amount specified as compensation for the Evaluator in
the Prospectus but, if the Depositor is acting as Evaluator, in no event shall
such compensation, when combined with all compensation received from other
series of the Fund or other unit investment trusts sponsored by the Depositor or
its affiliates for services as Evaluator, in any calendar year exceed the
aggregate cost to the Depositor of providing such services. The rate of such
compensation may be increased from time to time, without the consent or approval
of any Unitholder or the Trustee, by amounts not exceeding the proportionate
increase, during the period from the date of the Trust Agreement to the date of
any such increase, in consumer prices as last published prior to each such date
under the classification "All Services Less Rent of Shelter" in the Consumer
Price Index For All Urban Consumers (CPI-U) U.S. City Average, not seasonally
adjusted, base 1982 - 84 = 100, published by the United States Department of
Labor. In the event that such classification ceases to incorporate a
significant number of items, or if a substantial change is made in the method of
establishing such classification, then the classification shall be adjusted in a
fair and reasonable manner to the figure that would have resulted had no
substantial change occurred in the manner of computing such classification. In
the event that such classification (or a successor or substitute index) is not
available, such governmental or other service or publication as shall evaluate
the information in substantially the same manner as the aforesaid
classification, shall be used in lieu thereof. Such compensation shall be
charged by the Trustee, upon receipt of invoice therefor from the Evaluator,
against the Income and Capital Accounts on or before the Distribution Date. If
the cash balances in the Income and Capital Accounts shall be insufficient to
provide for amounts payable pursuant to this Section 4.03, the Trustee shall
have the power to sell (i) Securities designated to be sold pursuant to Section
5.02 hereof or (ii) if no such Securities have been so designated, such
Securities 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 4.03. Any moneys payable to the Evaluator pursuant to this
Section 4.03 shall be secured by a prior lien on the Trust Fund except that such
lien shall be junior and subordinate to any lien in favor of the Trustee under
the provisions of Section 8.08.
SECTION 4.04. LIABILITY OF THE EVALUATOR. The Trustee, the Depositor and
the Unitholders may rely on any evaluation furnished by the Evaluator and shall
have no responsibility for the accuracy thereof. The determinations made by the
Evaluator hereunder shall be made in good faith. The Evaluator shall be under
no liability to the
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Trustee, the Depositor or the Unitholders except for any liability to which it
would be subject by reason of wilful misfeasance, bad faith or negligence in the
performance of its duties or by reason of its reckless disregard of its
obligations and duties hereunder.
SECTION 4.05. RESIGNATION, REMOVAL AND OTHER MATTERS RELATING TO THE
EVALUATOR. (a) The Evaluator may resign and be discharged hereunder, by
executing an instrument in writing resigning as the Evaluator and filing the
same with the Depositor (if separate from the Evaluator) and the Trustee not
less than 60 days before the date specified in such instrument when, subject to
Section 4.05(c), such resignation is to take effect. Upon receiving such notice
of resignation, the Depositor shall use its best efforts to appoint a successor
Evaluator having qualifications and at a rate of compensation satisfactory to
the Depositor. Such appointment shall be made by written instrument executed by
the Depositor and the Trustee in duplicate, one copy of which shall be delivered
to the resigning Evaluator and one copy to the successor evaluator. The
Depositor or the Trustee may remove the Evaluator at any time upon thirty days'
written notice and appoint a successor evaluator having qualifications and at a
rate of compensation satisfactory to the Depositor and the Trustee. Such
appointment shall be made by written instrument executed by the Depositor and
the Trustee in duplicate, one copy of which shall be delivered to the Evaluator
so removed and one copy to the successor evaluator. Notice of such resignation
or removal and appointment of a successor evaluator shall be mailed by the
Trustee to each Unitholder.
(b) If the Evaluator resigns and no successor evaluator shall have been
appointed and have accepted appointment within 30 days after receipt of the
notice of resignation by the Depositor and the Trustee, the Evaluator may
forthwith apply to a court of competent jurisdiction for the appointment of a
successor evaluator. Such court may thereupon, after such notice, if any, as it
may deem proper, appoint a successor evaluator.
(c) Any successor evaluator appointed hereunder shall execute, acknowledge
and deliver to the Depositor and the Trustee an instrument accepting such
appointment hereunder, and such successor evaluator without any further act,
deed or conveyance shall become vested with all the rights, powers, duties and
obligations of its predecessor hereunder with like effect as if originally named
the Evaluator herein and shall be bound by all the terms and conditions of this
Agreement. Any resignation or removal of the Evaluator and appointment of a
successor evaluator pursuant to this Section 4.05 shall become effective upon
such acceptance of appointment.
(d) Any corporation into which the Evaluator hereunder may be merged or
with which it may be consolidated, or any corporation resulting from any merger
or consolidation to which the Evaluator hereunder shall be a party, shall be the
successor evaluator under this Agreement without the execution or filing of any
paper, instrument or further act to be done on the part of the parties hereto,
anything herein, or in any agreement relating to such merger or consolidation,
by which the Evaluator may seek to retain certain powers, rights and privileges
theretofore obtaining for any period of time following such merger or
consolidation, to the contrary notwithstanding.
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ARTICLE V
TRUST FUND EVALUATION; REDEMPTION OF UNITS
SECTION 5.01. TRUST FUND EVALUATION. As of the Evaluation Time next
following any tender by a Unitholder for redemption and on any other business
day desired by it or as may be required hereunder, the Trustee shall as to each
Trust Fund:
Add
(1) cash on hand in the Trust Fund (other than cash held especially
for the purchase of Contract Securities) and moneys in the process of being
collected from declared dividends,
(2) the aggregate value of each issue of the Securities in the Trust
Fund (including Contract Securities) as determined by the Evaluator
pursuant to Section 4.01,
(3) amounts representing organizational expenses paid from the Trust
less amounts representing accrued organizational expenses of the Trust, and
(4) all other assets of the Trust;
Deduct
(1) amounts representing any applicable taxes, governmental charges
or other charges pursuant to Section 3.03 payable out of the Trust Fund and
for which no deductions shall have previously been made for the purpose of
addition to the Reserve Account,
(2) amounts representing estimated accrued fees and expenses of the
Trust Fund including but not limited to unpaid fees and expenses of the
Trustee (including legal and auditing expenses), the Evaluator, the
Depositor and counsel, and
(3) cash allocated for distribution to Unitholders of the Trust Fund
of record as of the business day prior to the evaluation then being made.
The resulting figure is herein called a "TRUST FUND EVALUATION."
Until the Depositor has informed the Trustee that there will be no further
deposits of Additional Securities pursuant to Section 2.01(b), the Depositor
shall provide the Trustee with written estimates of (i) the total organizational
expenses to be borne by the Trust pursuant to Section 10.02 and (ii) the total
number of Units to be issued in connection with the initial deposit and all
anticipated deposits of additional Securities. For purposes of calculating the
Trust Fund Evaluation and Unit Value, the Trustee shall treat all such
anticipated expenses as having been paid and all liabilities therefor as having
been incurred,
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and all Units as having been issued, in each case on the date of the Trust
Agreement, and, in connection with each such calculation, shall take into
account a pro rata portion of such expense and liability based on the actual
number of Units issued as of the date of such calculation. In the event the
Trustee is informed by the Depositor of a revision in its estimate of total
expenses or total Units and upon the conclusion of the deposit of additional
Securities, the Trustee shall base calculations made thereafter on such revised
estimates or actual expenses, respectively, but such adjustment shall not affect
calculations made prior thereto and no adjustment shall be made in respect
thereof.
SECTION 5.02. REDEMPTION OF UNITS; SALE OF SECURITIES. Any Unitholder may
cause any of his Units to be redeemed by the Trustee, subject to the terms of
this Section 5.02, by making a written request to the Trustee at its principal
trust office, and, in the case of Units evidenced by a Certificate, by tendering
such Certificate to the Trustee at such office, properly endorsed or accompanied
by a written instrument or instruments of transfer in form satisfactory to the
Trustee. Unitholders must sign such written request, and such Certificate or
transfer instrument, exactly as their name appears on the records of the Trustee
and on any Certificate representing the Units to be redeemed. Such signature
must be guaranteed by a participant in the Securities Transfer Agents Medallion
Program ("STAMP") or such other signature guarantee program in addition to, or
in substitution for, STAMP, as may be accepted by the Trustee. Such redemption
shall be made by the Trustee on the third business day following the day on
which request for redemption is received by the Trustee, (such date being herein
called the "REDEMPTION DATE"). Subject to payment by such Unitholder of any tax
or other governmental charges which may be imposed thereon and subject to
payments in the form of In Kind Distributions (as defined below), such
redemption is to be made by payment on the Redemption Date of cash equal to the
Unit Value (determined on the basis of the Trust Fund Evaluation made in
accordance with Section 5.01) multiplied by the number of Units being redeemed
(herein called the "REDEMPTION PRICE"). The portion of the Redemption Price
which represents dividends shall be withdrawn from the Income Account of the
affected Trust Fund to the extent available. The balance paid on any redemption
shall be withdrawn from the Capital Account of the affected Trust to the extent
that funds are available for such purpose. If such available balance shall be
insufficient, the Trustee shall sell from such Trust Fund such Securities from
among those designated for such purpose by the Depositor as the Trustee in its
discretion, shall deem advisable or necessary. In the event that funds are
withdrawn from the Capital Account or Securities are sold for payment of any
portion of the Redemption Price representing declared but unpaid dividends, the
Capital Account shall be reimbursed when sufficient funds are next available in
the Income Account for such funds so applied.
The Trustee may in its discretion, and shall when so directed by the
Depositor in writing, suspend the right of redemption or postpone the date of
payment of the Redemption Price for more than three business days following the
day on which tender for redemption is made (1) for any period during which the
New York Stock Exchange, Inc. is closed other than customary weekend and holiday
closings; (2) for any period during which (i) trading on the New York Stock
Exchange, Inc. is restricted or (ii) an emergency exists as a result of which
disposal by the Trust Fund of the Securities is not reasonably practicable or it
is not reasonably practicable fairly to determine in accordance herewith the
value of the Securities
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for the purposes of any Trust Fund Evaluation; or (3) for such other period as
the Securities and Exchange Commission may by order permit.
No later than the close of business on the day of tender of any Unit for
redemption by a Unitholder other than the Depositor, the Trustee shall notify
the Depositor of such tender. The Depositor shall have the right to purchase
such Units by notifying the Trustee of its election to make such purchase as
soon as practicable thereafter but in no event subsequent to the close of
business on the second business day after the day on which such Units were
tendered for redemption. Such purchase shall be made by payment for such Units
by the Depositor to the Unitholder not later than the close of business on the
Redemption Date of any amount not less than the Redemption Price which would
otherwise be payable by the Trustee to such Unitholder.
Any Unit so purchased by the Depositor may at the option of the Depositor
be tendered to the Trustee for redemption in the manner provided in the first
paragraph of this Section 5.02.
Notwithstanding anything to the contrary in this Section 5.02, if offered
by the terms of the Prospectus, any Unitholder may, if such Unitholder tenders
at least that number of Units set forth in the Prospectus for redemption and
makes such tender on or prior to the date provided in the Prospectus, request at
the time of tender to receive from the Trustee in lieu of cash such Unitholder's
pro rata share of each Security then held by the Trust Fund. Such tendering
Unitholder will receive his pro rata number of whole shares of each of the
Securities comprising the portfolio of the Trust Fund and cash from the Capital
Account equal to the value of the fractional shares to which such tendering
Unitholder is entitled. Such pro rata share of each Security and the related
cash equal to the value of the fractional shares to which such tendering
Unitholder is entitled is referred to herein as an "IN KIND DISTRIBUTION." An
In Kind Distribution will be made by the Trustee through the distribution of
each of the Securities in book-entry form to the account of the Unitholder's
bank or broker-dealer at Depository Trust Company. If funds in the Capital
Account are insufficient to cover the required cash distribution to the
tendering Unitholder, the Trustee may sell Securities according to the criteria
discussed above.
The Depositor shall deliver a current list of Securities in each Trust Fund
to be sold for the purpose of redemption of Units tendered for redemption and
for payment of expenses hereunder. If at any such time the Depositor shall for
any reason fail to deliver such a list, the Trustee, in its sole discretion, may
designate a current list of Securities in each Trust Fund for such purposes.
The net proceeds of any sale of Securities shall be credited to the Capital
Account of such Trust Fund.
Except as provided in Article VII and Article VIII, neither the Depositor
nor the Trustee shall be liable or responsible in any way for depreciation or
loss incurred by reason of any sale or designation of Securities made pursuant
to this Section 5.02.
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Any Certificates evidencing Units redeemed pursuant to this Section 5.02
shall be cancelled by the Trustee and the Unit or Units evidenced by such
Certificates shall be extinguished by such redemptions.
SECTION 5.03. ROLLOVER OF UNITS. (a) If the Depositor shall offer a
subsequent series of the Nuveen Unit Trust (the "NEW SERIES"), the Trustee
shall, at the Depositor's direction and at the Depositor's sole cost and
expense, include in the notice sent to Unitholders a form of election whereby
Unitholders, whose redemption distribution would be in an amount sufficient to
purchase at least one Unit of the New Series, may elect to have their Units(s)
redeemed in kind in the manner provided in Section 5.02, the Securities included
in the redemption distribution sold, and the cash proceeds applied by the
Distribution Agent to purchase Units of the New Series, all as hereinafter
provided. The Trustee shall honor properly completed election forms returned to
the Trustee, accompanied by any Certificate evidencing Units tendered for
redemption or a properly completed redemption request with respect to
uncertificated Units, by its close of business on the Rollover Notification
Date.
All Units so tendered by a Unitholder (a "ROLLOVER UNITHOLDER") shall be
redeemed and cancelled on the first day of the Special Redemption and
Liquidation Period. Subject to payment by such Rollover Unitholder of any tax
or other governmental charges which may be imposed thereon, such redemption is
to be made in kind pursuant to Section 5.02 by distribution of cash and/or
Securities to the Distribution Agent based on the net asset value as of the
first day of the Special Redemption and Liquidation Period multiplied by the
number of Units being redeemed (herein called the "Rollover Distribution").
All Securities included in a Unitholder's Rollover Distribution shall be
sold by the Distribution Agent during the Special Redemption and Liquidation
Period pursuant to the Depositor's direction, and the Distribution Agent shall,
when directed by the Depositor, employ the Depositor or one of its affiliates as
broker in connection with such sales. All such sales shall be effected through
the Depository Trust Company. For such brokerage services, the Depositor or
such affiliate shall be entitled to compensation at its customary rates,
PROVIDED HOWEVER, that its compensation shall not exceed the amount authorized
by applicable securities laws and regulations. The Depositor or such affiliate
shall direct that sales be made in accordance with the guidelines set forth in
the related Prospectus. The Distribution Agent shall have no responsibility for
any loss or depreciation incurred by reason of any sale made pursuant to this
Section.
Upon each trade date for sales of Securities included in the Rollover
Unitholder's Rollover Distribution, the Distribution Agent shall, as agent for
such Rollover Unitholder, enter into a contract with the Depositor to purchase
from the Depositor Units of the New Series (if any), at the Depositor's public
offering price for such Units on such day, and at such reduced sales charge as
shall be described in the Prospectus for the Trust. Such contract shall provide
for purchase of the maximum number of Units of the New Series whose purchase
price is equal to or less than the cash proceeds held by the Distribution Agent
for the Unitholder on such day (including therein the proceeds anticipated to be
received in respect of Securities traded on such day net of all brokerage fees,
governmental charges and any other expenses incurred in connection with such
sale), to the extent Units
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are available for purchase from the Depositor. In the event a sale of
Securities included in the Rollover Unitholder's redemption distribution shall
not be consummated in accordance with its terms, the Distribution Agent shall
apply the cash proceeds held for such Unitholder as of the settlement date for
the purchase of Units of the New Series to purchase the maximum number of units
which such cash balance will permit, and the Depositor agrees that the
settlement date for Units whose purchase was not consummated as a result of
insufficient funds will be extended until cash proceeds from the Rollover
Distribution are available in a sufficient amount to settle such purchase. If
the Unitholder's Rollover Distribution will produce insufficient cash proceeds
to purchase all of the Units of the New Series contracted for, the Depositor
agrees that the contract shall be rescinded with respect to the Units as to
which there was a cash shortfall without any liability to the Rollover
Unitholder or the Distribution Agent. Any cash balance remaining after such
purchase shall be distributed within a reasonable time to the Rollover
Unitholder by check mailed to the address of such Unitholder on the registration
books of the Trustee. Any cash held by the Distribution Agent shall be held in
a non-interest bearing account which will be of benefit to the Distribution
Agent. Except as provided in Article VIII, neither the Trustee nor the
Distribution Agent shall have any responsibility or liability for loss or
depreciation resulting from any reinvestment made in accordance with this
paragraph, or for any failure to make such reinvestment in the event the
Depositor does not make Units available for purchase.
(b) Notwithstanding the foregoing, the Depositor may, in their discretion
at any time, decide not to offer Trust Series in the future, and if so, this
Section 5.03 concerning the Rollover of Units shall be inoperative.
(c) The Distribution Agent shall receive no fees for performing its duties
hereunder. The Distribution Agent shall, however, be entitled to receive
reimbursement from the Trust for any and all expenses and disbursements to the
same extent as the Trustee is permitted reimbursement hereunder.
ARTICLE VI
ISSUANCE, TRANSFER, INTERCHANGE AND REPLACEMENT OF CERTIFICATES
SECTION 6.01. ISSUANCE OF CERTIFICATES. Unless otherwise provided in the
Prospectus, Certificates representing Units held by a Unitholder will not be
issued except upon written request by a Unitholder, or his or her registered
broker/dealer, to the Trustee at its unit investment trust office that such
Units be held in certified form. Certificates that have been issued may be
returned to the Trustee at any time and cancelled, without affecting the
Unitholder's interest in the Trust Fund, when accompanied by proper written
instructions from the Unitholder.
SECTION 6.02. TRANSFER OF UNITS; INTERCHANGE OF CERTIFICATES. A
Unitholder may transfer any of his Units by making a written request to the
Trustee at its unit investment trust office and, in the case of Units evidenced
by a Certificate, by presenting and surrendering such Certificate at such office
properly endorsed or accompanied by a written instrument or instruments of
transfer in form satisfactory to the Trustee. Unitholders must
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sign such written request, and such Certificate of transfer instrument, exactly
as their name appears on the records of the Trustee and on any Certificate
representing the Units to be transferred. Such signature must be guaranteed by
a participant in the Securities Transfer Agents Medallion Program ("STAMP") or
such other signature guarantee program in addition to, or in substitution for,
STAMP, as may be accepted by the Trustee. Such transfer shall thereupon be made
on the records of the Trustee and, if appropriate, a new registered Certificate
or Certificates for the same number of Units of the same Trust Fund shall be
issued in exchange and substitution therefor. Certificates issued pursuant to
this Agreement are interchangeable for one or more other Certificates of the
same Trust Fund in an equal aggregate number of Units and all Certificates
issued shall be issued in denominations of one Unit or any whole multiple
thereof as may be requested by the Unitholder. The Trustee may deem and treat
the person in whose name any Unit or Certificate shall be registered upon the
books of the Trustee as the owner of such Unit or Certificate for all purposes
hereunder and the Trustee shall not be affected by any notice to the contrary.
The transfer books maintained by the Trustee for each Trust Fund for the purpose
of this Section 6.02 shall be closed for an individual Trust Fund as such Trust
Fund is terminated pursuant to Article IX hereof.
A sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any such transfer or interchange shall be paid to the
Trustee. A Unitholder may be required to pay $2 (or such other amount as may be
specified by the Trustee and approved by the Depositor) for each new Certificate
issued on any such transfer or interchange.
All Certificates cancelled pursuant to this Agreement, other than those
endorsed for transfer, may be cremated or otherwise destroyed by the Trustee.
SECTION 6.03. REPLACEMENT OF CERTIFICATES. In case any Certificate shall
become mutilated or be destroyed, stolen or lost, the Trustee shall execute and
deliver a new Certificate in exchange and substitution therefor upon the
Unitholder's furnishing the Trustee with proper identification and satisfactory
indemnity, complying with such other reasonable regulations and conditions as
the Trustee may prescribe and paying such expenses as the Trustee may incur,
PROVIDED, HOWEVER, that if the particular Trust Fund has terminated or is in the
process of termination, the Trustee, in lieu of issuing such new Certificate,
may, upon the terms and conditions set forth herein, make the distributions set
forth in Section 9.01 hereof. Any mutilated Certificate shall be duly
surrendered and cancelled before any duplicate Certificate shall be issued in
exchange and substitution therefor. Any duplicate Certificate issued pursuant
to this Section 6.03 shall constitute complete and indefeasible evidence of
ownership in the Trust Fund, as if originally issued, whether or not the lost,
stolen or destroyed Certificate shall be found at any time. Upon issuance of
any duplicate Certificate pursuant to this Section 6.03, the Certificate claimed
to have been lost, stolen or destroyed shall become null and void and of no
effect, and any bona fide purchaser thereof shall have only such rights as are
afforded under Article 8 of the Uniform Commercial Code to a holder presenting a
Certificate for transfer in the case of an overissue.
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SECTION 6.04. FORM OF CERTIFICATE. Each Certificate shall be in fully
registered form, shall be numbered serially for identification, shall be
executed in facsimile by the original Depositor of the Trust Fund in question
and manually by an authorized signatory of the Trustee, shall be dated the date
of execution and delivery by the Trustee and shall represent a fractional
undivided interest in the specified Trust Fund, the numerator of which fraction
shall be the number of Units set forth on the face of such Certificate and the
denominator of which shall be the total number of Units of undivided interest of
such Trust Fund outstanding at any such time.
ARTICLE VII
DEPOSITOR
SECTION 7.01. CERTAIN MATTERS REGARDING SUCCESSION. The covenants,
provisions and agreements herein contained shall in every case be binding upon
any successor to the business of any Depositor. In the event of an assignment
by any Depositor to a successor corporation or partnership as permitted by the
next following sentence, such Depositor and, if such Depositor is a partnership,
its partners shall be relieved of all further liability under this Agreement.
Any Depositor may transfer all or substantially all of its assets to a
corporation or partnership which carries on the business of such Depositor, if
at the time of such transfer such successor duly assumes all the obligations of
such Depositor under this Agreement.
SECTION 7.02. LIABILITY OF DEPOSITOR AND INDEMNIFICATION. (a) The
Depositor shall not be under any liability to any Trust Fund or the Unitholders
for any action taken or for refraining from the taking of any action in good
faith pursuant to this Agreement, or for errors in judgment or for depreciation
or loss incurred by reason of the purchase or sale of any Securities, provided,
however, that this provision shall not protect the Depositor against any
liability to which it would otherwise be subject by reason of wilful
misfeasance, bad faith or negligence in the performance of its duties or by
reason of its reckless disregard of its obligations and duties hereunder. The
Depositor may rely in good faith on any paper, order, notice, list, affidavit,
receipt, evaluation, opinion, endorsement, assignment, draft or any other
document of any kind prima facie properly executed and submitted to it by the
Trustee, the Trustee's counsel, the Evaluator or any other person for any
matters arising hereunder. The Depositor shall in no event be deemed to have
assumed or incurred any liability, duty or obligation to any Unitholder, the
Evaluator or the Trustee other than as expressly provided for herein.
(b) Each Trust Fund shall pay and hold the Depositor harmless from and
against any loss, liability or expense incurred in acting as Depositor of such
Trust Fund other than by reason of wilful misfeasance, bad faith or gross
negligence in the performance of its duties or by reason of its reckless
disregard of its obligations and duties hereunder. The Depositor shall not be
under any obligation to appear in, prosecute or defend any legal action which in
its opinion may involve it in any expense or liability, PROVIDED, HOWEVER, that
the Depositor may in its discretion undertake any such action which it may deem
necessary or desirable in respect of this Agreement and the rights and duties of
the parties
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hereto and the interests of the Unitholders hereunder and, in such event, the
legal expenses and costs of any such action and any liability resulting
therefrom shall be expenses, costs and liabilities of the Trust Fund
concerned and shall be paid directly by the Trustee out of the Income and
Capital Accounts of such Trust Fund.
(c) None of the provisions of this Agreement shall be deemed to protect or
purport to protect the Depositor against any liability to the Trust Fund or to
the Unitholders to which the Depositor would otherwise be subject by reason of
wilful misfeasance, bad faith or negligence in the performance of its duties, or
by reason of the Depositor's reckless disregard of its obligations and duties
under this Agreement.
ARTICLE VIII
TRUSTEE
SECTION 8.01. GENERAL MATTERS RELATING TO THE TRUSTEE. (a) All
moneys deposited with or received by the Trustee hereunder shall be held by it
without interest in trust as part of the appropriate Trust Fund or Reserve
Account until required to be disbursed in accordance with the provisions of this
Agreement and such moneys will be segregated in such manner as shall constitute
the segregation and holding thereof in trust within the meaning of the
Investment Company Act of 1940.
(b) The Trustee shall be under no liability for any action taken in good
faith on any evaluation, paper, order, list, demand, request, consent,
affidavit, notice, opinion, direction, endorsement, assignment, resolution,
draft or other document whether or not of the same kind, prima facie properly
executed, or the disposition of moneys or Securities pursuant to this Agreement;
PROVIDED, HOWEVER, that this provision shall not protect the Trustee against any
liability to which it would otherwise be subject by reason of wilful
misfeasance, bad faith or gross negligence in the performance of its duties or
by reason of its reckless disregard of its obligations and duties hereunder, and
the Trustee may construe any of the provisions of this Agreement insofar as the
same may appear to be ambiguous or inconsistent with any other provisions
hereof, and any construction of any such provisions hereof by the Trustee in
good faith shall be binding upon the parties hereto and the Unitholders.
(c) The Trustee shall not be responsible for or in respect of the recitals
herein, the validity or sufficiency of this Agreement or for the due execution
hereof by the Depositor, or for the form, character, genuineness, sufficiency,
value or validity of any Securities or for or in respect of the validity or
sufficiency of any Certificates (except for the due execution thereof by the
Trustee) or for the due execution thereof by the Depositor and the Trustee shall
in no event assume or incur any liability, duty or obligation to any Unitholder
or to the Depositor or Evaluator, other than as expressly provided for herein.
The Trustee shall not be responsible for or in respect of the validity of any
signature by or on behalf of the Depositor.
(d) The Trustee shall not be under any obligation to appear in, prosecute
or defend any action which in its opinion may involve it in expense or liability
unless it shall be
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furnished with such reasonable security and indemnity against such expense or
liability as it may be required, and any pecuniary cost of the Trustee from
such actions shall be deductible ratably from and a ratable charge against
the Trust Funds concerned. The Trustee shall in its discretion undertake
such action as it may deem necessary at any and all times to protect the
Trust Funds and the rights and interests of the Unitholders pursuant to the
terms of this Agreement, PROVIDED, HOWEVER, that the expenses and costs of
such actions, undertakings or proceedings shall be reimbursable to the
Trustee ratably from the Trust Funds concerned.
(e) The Trustee may employ agents, attorneys, accountants and auditors,
including an agent or agents for the purpose of custody and safeguarding
Securities, and shall not be answerable for the default or misconduct of any
such agents, attorneys, accountants or auditors if such agents, attorneys,
accountants or auditors shall have been selected with reasonable care. The
Trustee shall not be liable in respect of any action taken or suffered under
this Agreement in good faith, in accordance with an opinion of counsel. The
fees and expenses charged by such agents, attorneys, accountants or auditors,
except for the fees and expenses charged by any agent or agents for custody and
safeguarding of United States domestic Securities of the sort customarily
provided by the Trustee, shall constitute an expense of the Trustee reimbursable
from the Income and Capital Accounts as set forth in Section 3.04 hereof.
(f) If at any time the Depositor shall fail to undertake or perform any of
the duties which by the terms of this Agreement are affirmatively required by it
to be undertaken or performed, or the Depositor shall be incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver of the Depositor or of
its property shall be appointed, or any public officer shall take charge or
control of the Depositor or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then in any such case, the Trustee
may do any one or more of the following: (1) appoint a successor Depositor who
shall act hereunder in all respects in place of such Depositor and which may be
compensated, at rates deemed by the Trustee to be reasonable under the
circumstances, by deduction ratably from the Income Account or, to the extent
funds are not available in such Account, from the Capital Account of the Trust
Funds but no such deduction shall be made exceeding such reasonable amount as
the Securities and Exchange Commission may prescribe in accordance with Section
26(a)(2)(C) of the Investment Company Act of 1940; (2) continue to act as
Trustee hereunder without terminating this Agreement; or (3) terminate this
Agreement and the trust created hereby and liquidate the Trust Funds in the
manner provided in Section 9.01.
(g) (i) The Trustee may in its discretion, and shall if so directed by the
Depositor, terminate this Agreement and any Trust created hereby (but only
insofar as the Agreement relates to such Trust) and liquidate such Trust, all in
the manner provided in Section 9.01 if the value of such Trust as shown by any
Trust Fund Evaluation shall be less than the liquidation amount specified in the
Prospectus; and (ii) the Trustee shall terminate this Agreement and any Trust
created hereby (but only insofar as the Agreement relates to such Trust) and
liquidate such Trust all in the manner provided in Section 9.01 if by reason of
the aggregate redemption of Units not theretofore sold by the Depositor and/or
one or more
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of the underwriters the net worth of such Trust Fund is reduced to less than
40% of the aggregate original value of the Securities initially deposited
therein.
(h) In no event shall the Trustee be personally liable for any taxes or
other governmental charges imposed upon or in respect of the Securities or upon
any dividends or interest thereon. The Trustee shall be reimbursed and
indemnified out of the Income and Capital Accounts of the appropriate Trust Fund
for all such taxes and charges, for any tax or charge imposed against the
Trustee as Trustee of such Trust Fund and for any expenses, including counsel
fees, which the Trustee may sustain or incur with respect to such taxes or
charges.
(i) Notwithstanding any provisions of this Agreement to the contrary, no
payment to a Depositor or to any principal underwriter (as defined in the
Investment Company Act of 1940) for the Trust Fund or to any affiliated person
(as so defined) or agent of a Depositor or such underwriter shall be allowed the
Trustee as an expense except for payment of such reasonable amounts as the
Securities and Exchange Commission may prescribe as compensation for performing
bookkeeping and other administrative services, as set forth in Section 3.13, of
a character normally performed by the Trustee.
(j) The Trustee in its individual or any other capacity may become an
owner or pledgee of, or be an underwriter or dealer in respect of, obligations
issued by the same issuer (or an affiliate of such issuer) or any Securities at
any time held as part of the Trust and may deal in any manner with the same or
with the issuer (or an affiliate of the issuer) with the rights and powers as if
it were not the Trustee hereunder.
(k) The Trust may include a letter or letters of credit for the purchase
of Securities or Contract Securities issued by the Trustee in its individual
capacity for the account of the Depositor and the Trustee may otherwise deal
with the Depositor and the Trust within the same rights and powers as if it were
not the Trustee hereunder.
The provisions of this section and the indemnification provided the Trustee
under Section 8.05 and collateral security provided the Trustee under Section
8.08 shall apply as fully to the Trustee in its capacity as Evaluator, Program
Agent and Distribution Agent.
SECTION 8.02. BOOKS, RECORDS AND REPORTS. The Trustee shall keep
proper books of record and account of all the transactions of each Trust under
this Indenture at its unit investment trust office including a record of the
name and address of, and the Certificates issued by each Trust and held by,
every Unitholder, and such books and records of each Trust shall be open to
inspection by any Unitholder of such Trust at all reasonable times during the
usual business hours.
Unless the Depositor determines that such an audit is not required, the
account of each Trust shall be audited not less than annually by independent
public accountants designated from time to time by the Depositor and reports
of such accountants shall be furnished by the Trustee, upon request, to
Unitholders. The Trustee, however, in connection with
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any such audits shall not be obligated to use Trust assets to pay for such
audits in excess of the amounts indicated in the Prospectus relating to such
Trust.
To the extent permitted under the Investment Company Act of 1940 as
evidenced by an opinion of independent counsel to the Depositor, the Trustee
shall pay, or reimburse to the Depositor or others, the costs of the
preparation of documents and information with respect to a Trust required by
law or regulation in connection with the maintenance of a secondary market in
Units of such Trust. Such costs may include, but are not limited to,
accounting and legal fees, blue sky registration and filing fees, printing
expenses and other reasonable expenses related to documents required under
federal and state securities laws. Such costs shall be a Trust expense and
the Trustee shall not be obligated to advance any of its own funds to make
such payments.
SECTION 8.03. REPORTS TO SECURITIES AND EXCHANGE COMMISSION AND
OTHERS. The Trustee shall make such annual or other reports as may from time
to time be required under any applicable state or federal statute or rule or
regulation thereunder.
SECTION 8.04. AGREEMENT AND LIST OF SECURITIES ON FILE. The Trustee
shall keep a certified copy or duplicate original of this Agreement on file at
its unit investment trust office available for inspection by any Unitholder at
all reasonable times during its usual business hours, and the Trustee shall keep
and so make available for inspection a current list of the Securities in each
Trust Fund.
SECTION 8.05. COMPENSATION OF TRUSTEE. The Trustee shall receive at
the times and in the manner set forth in Section 3.04 as compensation for
performing the usual, ordinary, normal and recurring services under this
Agreement during the preceding month an amount equal to the amount specified as
compensation for the Trustee in the Prospectus. Such fee shall accrue daily and
be computed on the basis of the largest member of Units outstanding during the
period with respect to which such compensation is paid. The Trustee may
periodically adjust the compensation provided for pursuant to this paragraph (i)
in response to fluctuations in short-term interest rates and average cash
balances of the Trust accounts (reflecting the cost to the Trustee of advancing
funds to a Trust and changes in anticipated earnings on cash balances) and (ii)
in addition, may from time to time, without the consent or approval of any
Unitholder or the Depositor, adjust such portion of its fee as is not computed
by reference to the cash balance in the Trust accounts by amounts not exceeding
the proportionate increase, during the period from the date of such Trust
Agreement to the date of any such increase, in consumer prices as last published
prior to each such date under the classification "All Services Less Rent of
Shelter" in the Consumer Price Index For All Urban Consumers (CPI-U) U.S. City
Average, not seasonally adjusted, base 1982 - 84 = 100, published by the United
States Department of Labor. In the event that such classification ceases to
incorporate a significant number of items, or if a substantial change is made in
the method of establishing such classification, then the classification shall be
adjusted in a fair and reasonable manner to the figure that would have resulted
had no substantial change occurred in the manner of computing such
classification. In the event that such classification (or a successor or
substitute index) is not available, such governmental or other service or
publication as shall evaluate the information in substantially the same
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manner as the aforesaid classification, shall be used in lieu thereof. The
Trustee shall also receive, at the times and in the manner set forth in
Section 3.04, reimbursement for any and all expenses, disbursements and
advances incurred hereunder (except as set forth in Section 8.01(e)),
including legal and auditing expenses and additional compensation for any
extraordinary services performed hereunder, which extraordinary services
shall include, but not be limited to, all costs and expenses incurred by the
Trustee in making any annual or other reports pursuant to Section 8.03, or in
making any distribution of cash attributable to failed contracts covering
Contract Securities in accordance with Section 3.04; PROVIDED, HOWEVER, that
the amount of any such charge which has not been finally determined as of any
Distribution Date may be estimated and any necessary adjustments shall be
made in any succeeding period.
The Trustee shall be indemnified ratably from the Trust Funds and held
harmless against any loss, liability or expense incurred without gross
negligence, bad faith, wilful misconduct or reckless disregard of its duties
on the part of the Trustee arising out of or in connection with the
acceptance or administration of this trust, including the costs and expenses
of defending itself against any claim or liability in the premises.
The Trustee's normal and extraordinary compensation and reimbursement of
the above-mentioned expenses and losses shall be charged by the Trustee
against the Income and Capital Accounts of the appropriate Trust Funds in
accordance with Section 3.04 on or before each Distribution Date. If the
balances in the Income and Capital Accounts shall be insufficient to provide
for amounts payable pursuant to this Section 8.05, the Trustee shall have the
power to sell Securities in the manner provided in Section 5.02 hereof. The
Trustee shall not be liable or responsible in any way for depreciation or
loss incurred by reason of any sale of Securities made pursuant to this
Section 8.05.
SECTION 8.06. RESIGNATION, DISCHARGE OR REMOVAL OF THE TRUSTEE;
SUCCESSORS. (a) The Trustee may resign and be discharged of the trust created
by this Agreement by executing an instrument in writing resigning as Trustee of
such trust, filing the same with the Depositor and mailing a copy of a notice of
resignation to all Unitholders then of record, not less than sixty days before
the date specified in such instrument when, subject to Section 8.06(c), such
resignation is to take effect. Upon receiving such notice of resignation, the
Depositor shall use its best efforts promptly to appoint a successor trustee in
the manner and meeting the qualifications hereinafter provided, by written
instrument or instruments delivered to the resigning Trustee and the successor
trustee. In case at any time the Trustee shall not meet the requirements set
forth in Section 8.06 hereof, or shall become incapable of acting, or if a court
having jurisdiction in the premises shall enter a decree or order for relief in
respect of the Trustee in an involuntary case, or the Trustee shall commence a
voluntary case, under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, or any receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) for the Trustee or for any
substantial part of its property shall be appointed, or the Trustee shall
generally fail to pay its debts as they become due, the Depositor, upon 60 days'
prior written notice, may remove the Trustee and appoint a successor trustee
having qualifications and at a rate of compensation satisfactory to the
Depositor by written instrument, in duplicate, one copy of which shall be
delivered to the Trustee so removed and one copy to the successor
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trustee. Notice of such appointment of a successor trustee shall be mailed
promptly after acceptance of such appointment by the successor trustee to
each Unitholder then of record.
(b) In case at any time the Trustee shall resign and no successor trustee
shall have been appointed within thirty days after notice of resignation has
been received by the Depositor, the retiring Trustee may forthwith apply to a
court of competent jurisdiction for the appointment of a successor trustee.
Such court may thereupon, after such notice, if any, as it may deem proper and
prescribe, appoint a successor trustee.
(c) Any successor trustee appointed hereunder shall execute and
acknowledge to the Depositor and the retiring Trustee an instrument accepting
such appointment hereunder, and such successor trustee without any further act,
deed or conveyance shall become vested with all rights, powers, duties and
obligations of its predecessor hereunder with like effect as if originally named
a Trustee herein and shall be bound by all the terms and conditions of this
Agreement PROVIDED, HOWEVER, that no successor trustee shall be under any
liability hereunder for occurrences or omissions prior to the execution of such
instrument. Upon the request of such successor trustee, the retiring Trustee
shall, upon payment of all amounts due the retiring Trustee, execute and deliver
an instrument acknowledged by it transferring to such successor trustee all the
rights and powers of the retiring Trustee; and the retiring Trustee shall
transfer, deliver and pay over to the successor trustee all Securities and
moneys at the time held by it hereunder, if any, together with all necessary
instruments of transfer and assignment or other documents properly executed
necessary to effect such transfer and such of the records or copies thereof
maintained by the retiring Trustee in the administration hereof as may be
requested by the successor trustee and shall thereupon be discharged from all
duties and responsibilities under this Agreement. Any resignation or removal of
a Trustee and appointment of a successor trustee pursuant to this Section 8.06
shall become effective upon such acceptance of appointment by the successor
trustee.
(d) Any corporation into which a Trustee hereunder may be merged or with
which it may be consolidated, or any corporation resulting from any merger or
consolidation to which such Trustee hereunder shall be a party, shall be the
successor trustee under this Agreement without the execution or filing of any
paper, instrument or further act to be done on the part of the parties hereto,
anything herein, or in any agreement relating to such merger or consolidation,
by which any such Trustee may seek to retain certain powers, rights and
privileges theretofore obtaining for any period of time following such merger or
consolidation, to the contrary notwithstanding.
SECTION 8.07. QUALIFICATION OF TRUSTEE. The Trustee and any
successor trustee shall be a corporation organized under laws of the United
States, or any state thereof, which is authorized under such laws to exercise
trust powers and has at all times an aggregate capital, surplus and undivided
profits of not less than $5,000,000.
SECTION 8.08. COLLATERAL. As collateral security for the prompt
payment to the Trustee of all reimbursement to which the Trustee is entitled
hereunder and of all sums at any time owed to or payable to the Trustee
hereunder (including, without limitation, the prompt reimbursement of the
Trustee for any sums that it may from time to time in its discretion
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advance to the account of the Trust Fund), the Trustee is hereby granted a
first and prior lien and security interest in and to the Trust Fund and all
Securities now or hereafter included therein, including (without limitation)
those Securities listed in the Trust Agreement, together with all Securities,
obligations, Contract Securities and instruments received in exchange or
substitution therefor and all proceeds thereof and all additions and
substitutions.
ARTICLE IX
TERMINATION
SECTION 9.01. PROCEDURE UPON TERMINATION. This Agreement and the
trust created hereby shall terminate as to an individual Trust Fund upon the
maturity, redemption, sale or other disposition, as the case may be, of the last
Security held hereunder in such Trust Fund, unless sooner terminated as
hereinbefore specified, and may be terminated at any time by written instrument
executed by the Depositor and consented to by holders of Units representing
66-2/3% of the Units of such Trust Fund then outstanding under this Agreement;
PROVIDED, that in no event shall any individual Trust Fund continue beyond the
Mandatory Termination Date for such Trust Fund.
Written notice of any termination, specifying the time or times at which
any Unitholder holding Certificates may surrender such Certificates for
cancellation and the date, determined by the Trustee, upon which the transfer
books of the Trustee, maintained pursuant to Section 8.02, shall be closed
with respect to the terminated Trust Fund or the entire Fund, as the case may
be, shall be given by the Trustee to Unitholders of such terminated Trust
Fund or all Unitholders, as the case may be.
Within a reasonable period of time after the termination of a Trust Fund
or the entire Fund, the Trustee shall sell all of the Securities then held,
if any, and shall:
(a) deduct from the Income Account or to the extent that funds are
not available in such Account, from the Capital Account of every Trust
Fund separately and pay to itself individually an amount equal to the
sum of (1) its accrued compensation for its ordinary services in
connection with such Trust Fund, (2) any compensation due it for its
extraordinary services in connection with such Trust Fund and (3) any
other expenses, disbursements and advances in connection with such Trust
Fund as provided herein;
(b) deduct from the Income Account or to the extent that funds are
not available in such account, from the Capital Account of every Trust
Fund separately and pay accrued and unpaid fees in connection with such
Trust Fund of the Evaluator, the Depositor and counsel, if any;
(c) deduct from the Income Account, or to the extent that funds
are not available from such Account, from the Capital Account of every
Trust Fund separately any amounts which it in its sole discretion shall
deem requisite to be
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deposited in the Reserve Account to provide for any applicable taxes or
other governmental charges that may be payable out of such Trust Fund;
(d) distribute to each Unitholder (upon surrender for cancellation
of his Certificate or Certificates, if issued) such Unitholder's
interest in the balances of the Income and, on the conditions set forth
in Section 3.03 hereof, the Reserve Accounts of the Trust Fund in which
he holds Units;
(e) either distribute in cash to each Unitholder (upon surrender
for cancellation of his Certificate or Certificates, if issued) such
Unitholder's pro rata share of the balance of the Capital Account, or,
in the alternative, if offered by the terms of the Prospectus,
distribute to each Unitholder who then owns at least that number of
Units set forth in the Prospectus and who has requested an In Kind
Distribution under the conditions set forth in Section 5.02, such
holder's In Kind Distribution as set forth in Section 5.02; and
(f) together with such distribution to each Unitholder as provided
for in paragraph (d) and (e), furnish to each such Unitholder a final
statement as of the date of the computation of the amount distributable
to Unitholders of the same Trust Fund, setting forth the data and
information in substantially the form and manner provided for in Section
3.05 hereof.
Any Unitholder who receives an In Kind Distribution, if offered by the
terms of the Prospectus, shall receive such Distribution in the same manner
as is provided in connection with redemptions in Section 5.02.
SECTION 9.02. NOTICE TO UNITHOLDERS. In the event that all of the
Unitholders holding Certificates shall not surrender their Certificates for
cancellation within six months after the time specified in the applicable,
above-mentioned notice, the Trustee shall give a second written notice to the
remaining Unitholders to surrender their Certificates for cancellation and
receive the liquidating distribution with respect thereto. If within one year
after the second notice all the Certificates issued shall not have been
surrendered for cancellation, the Trustee may take appropriate steps or may
appoint an agent to take appropriate steps, to contact the remaining Unitholders
concerning surrender of their Certificates and the cost thereof shall be paid
out of the moneys and other assets which remain in the affected Trust Fund.
SECTION 9.03. MONEYS TO BE HELD IN TRUST WITHOUT INTEREST. The
Trustee shall be under no liability with respect to moneys in the Income,
Capital and Reserve Accounts upon termination, except to hold the same in trust
without interest.
SECTION 9.04. DISSOLUTION OF DEPOSITOR NOT TO TERMINATE. The
dissolution of the Depositor shall not, subject to Section 8.01(f), operate to
terminate this Agreement or the Fund or any individual Trust Fund.
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ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01. AMENDMENT AND WAIVER. This Agreement may be amended
from time to time by the Depositor and the Trustee without the consent of any of
the Unitholders (a) to cure any ambiguity or to correct or supplement any
provisions contained herein which may be defective or inconsistent with any
other provision contained herein; (b) to change any provision hereof as may be
required by the Securities and Exchange Commission or any successor governmental
agency exercising similar authority; or (c) to make such other provisions in
regard to matters or questions arising hereunder as shall not adversely affect
the interest of the Unitholders (as determined in good faith by the Depositor
and the Trustee). This Agreement may also be amended from time to time by the
Depositor and the Trustee (or the performance of any of the provisions of this
Agreement may be waived) with the consent of holders of Units representing
66-2/3% of the Units at the time outstanding under the Trust Agreement of the
individual Trust Fund or Trust Funds affected for the purpose of adding any
provisions of this Agreement or of modifying in any manner the rights of the
holders of Units of such Trust Fund or Trust Funds; PROVIDED, HOWEVER, that in
no event may any amendment be made which would (a) alter the rights to the
Unitholders as against each other, (b) provide the Trustee with the power to
engage in business or investment activities other than as specifically provided
in this Agreement or (c) adversely affect the characterization of the Trust as a
grantor trust for federal income tax purposes; PROVIDED, FURTHER, that the
consent of 100% of the Unitholders of any individual Trust Fund is required to
amend this Agreement (a) to increase the number of Units of such Trust Fund
issuable hereunder above the number of Units specified in the Prospectus or such
lesser amount as may be outstanding at any time during the term of this
Agreement, (b) to permit, in addition to acquisitions permitted under Section
3.10 hereof, the acquisition hereunder of any Securities for such Trust Fund
different from those specified in Schedule A to the Trust Agreement, (c) to
reduce the aforesaid percentage of Units the holders of which are required to
consent to certain amendments and (d) to reduce the interest in such Trust Fund
represented by any Units of such Trust Fund.
Promptly after the execution of any amendment requiring the consent of
the Unitholders or any of any other amendment if directed by the Depositor,
the Trustee shall furnish written notification of the substance of such
amendment to each Unitholder then of record affected thereby.
It shall not be necessary for the consent of Unitholders under this
Section 10.01 or under Section 9.01 to approve the particular form of any
proposed amendment, but it shall be sufficient if such consent shall approve
the substance thereof. The manner of obtaining such consents and of
evidencing the authorization of the execution thereof by Unitholders shall be
subject to such reasonable regulations as the Trustee may prescribe.
Section 10.02. INITIAL COSTS;. Unless otherwise provided in the
Trust's prospectus, the expenses incurred in establishing the Trust, including
the cost of the preparation and typesetting of the registration statement,
prospectuses (including preliminary prospectuses),
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the indenture and other documents relating to the Trust, printing of
Certificates, Securities and Exchange Commission and state blue sky
registration fees, the costs of the initial valuation of the portfolio and
audit of the Trust, the initial fees and expenses of the Trustee, and legal
and other out-of-pocket expenses related thereto, but not including the
expenses incurred in the printing of preliminary prospectuses and
prospectuses, expenses incurred in the preparation and printing of brochures
and other advertising materials and any other selling expenses, to the extent
not borne by the Depositor, shall be borne by the Trust. To the extent the
funds in the Income and Capital Accounts of the Trust shall be insufficient
to pay the expenses borne by the Trust specified in this Section 10.02, the
Trustee shall advance out of its own funds and cause to be deposited and
credited to the Income Account such amount as may be required to permit
payment of such expenses. The Trustee shall be reimbursed for such advance
on each Record Date (or such earlier date on which the expenses have been
fully accrued) from funds on hand in the Income Account or, to the extent
funds are not available in such Account, from the Capital Account, in the
amount deemed to have accrued as of such Record Date as provided in the
following sentence (less prior payments on account of such advances, if any),
and the provisions of Section 8.05 with respect to the reimbursement of
disbursements for Trust expenses, including, without limitation, the lien in
favor of the Trustee therefor and the authority to sell Securities as needed
to fund such reimbursement, shall apply to the payment of expenses and the
amounts advanced pursuant to this Section. For the purposes of the preceding
sentence and the addition provided in clause (3) of the first sentence of
Section 5.01, the expenses borne by the Trust pursuant to this Section shall
be deemed to have been paid on the date of the Trust Agreement and to accrue
at a daily rate over the time period specified for their amortization
provided in the Prospectus; provided, however, that nothing herein shall be
deemed to prevent, and the Trustee shall be entitled to, full reimbursement
for any advances made pursuant to this Section no later than the termination
of the Trust. For purposes of calculating the accrual of organizational
expenses under this Section 10.02, the Trustee shall rely on the written
estimates of such expenses provided by the Depositor pursuant to Section 5.01.
SECTION 10.03. REGISTRATION (INITIAL AND CURRENT) OF UNITS AND FUND.
The Depositor agrees and undertakes on its own part to register the Units, each
Trust Fund and the Fund with the Securities and Exchange Commission and under
the Blue Sky laws of such states as the Depositor may select.
SECTION 10.04. CERTAIN MATTERS RELATING TO UNITHOLDERS. (a) The
death or incapacity of any Unitholder shall not operate to terminate this
Agreement, the Fund or the Trust Fund in which he holds Units nor entitle his
legal representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Fund or such Trust
Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them. Each Unitholder expressly waives any right he
may have under any rule of law, or the provisions of any statute, or otherwise,
to require the Trustee at any time to account, in any manner other than as
expressly provided in this Agreement, in respect of the Securities or moneys
from time to time received, held and applied by the Trustee hereunder.
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(b) No Unitholder shall have any right to vote except as provided in
Sections 9.01 and 10.01 or in any manner otherwise to control the operation of
the Fund or the obligations of the parties hereto, nor shall anything set forth
in this Agreement or the Trust Agreement or contained in the terms of any
Certificates which may have been issued be construed so as to constitute the
Unitholders from time to time as partners or members of an association; nor
shall any Unitholder ever be under any liability to any third persons by reason
of any action taken by the parties to this Agreement, or for any other cause
whatsoever.
(c) By the purchase and acceptance or other lawful delivery and acceptance
of any Unit, whether certificated or not, the Unitholder shall be deemed to be a
beneficiary of the Trust created by this Agreement and the Trust Agreement and
vested with all right, title and interest in the Trust Fund therein created to
the extent of the Unit or Units set forth whether evidenced by such Certificate
or held in uncertificated form, subject to the terms and conditions of this
Agreement and the Trust Agreement.
(d) A Unitholder may at any time prior to the Evaluation Time on the date
the Trust is terminated tender his Units or his Certificate(s) if held in
certificated form (including any temporary Certificate or other evidence of
ownership of Units of the Trust Fund, issued by the Trustee or the Depositor) to
the Trustee for redemption, subject to and in accordance with Section 5.02.
SECTION 10.05. NEW YORK LAW TO GOVERN. This Agreement is executed
and delivered in the State of New York, and all laws or rules of construction of
such State, except for provisions with respect to choice of law, shall govern
the rights of the parties hereto and the Unitholders and the interpretation of
the provisions hereof.
SECTION 10.06. NOTICES. Any notice, demand, direction or instruction
to be given to the Depositor hereunder shall be in writing and shall be duly
given if mailed, first class with proper postage prepaid, or delivered to the
Depositor at 333 West Wacker Drive, Chicago, Illinois 60606, or at such other
address as shall be specified in the Prospectus or by the Depositor to the other
parties hereto in writing. Any notice, demand, direction or instruction to be
given to the Trustee shall be in writing and shall be duly given if mailed,
first class with proper postage prepaid, or delivered to the Trustee at 4 New
York Plaza, New York, New York 10004-2413, or such other address as shall be
specified to the other parties hereto in writing. Any notice to be given to a
Unitholder shall be duly given if mailed, first class with proper postage
prepaid, or delivered to each Unitholder at the address of such holder appearing
on the registration books of the Trustee.
SECTION 10.07. SEVERABILITY. If any one or more of the covenants,
agreements, provisions or terms shall be for any reason whatsoever held invalid,
then such covenants, agreements, provisions or terms shall be deemed severable
from the remaining covenants, agreements, provisions or terms of this Agreement
and shall in no way affect the validity or enforceability of the other
provisions of this Agreement or of any Certificates or the rights of the holders
thereof.
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SECTION 10.08. SEPARATE AND DISTINCT SERIES. Each series of Nuveen
Unit Trust to which these Standard Terms and Conditions of Trust shall be
applicable shall, for all financial and administrative purposes, be considered
separate and distinct from every other series, and neither the assets of nor the
expenses of any one series shall be applied or charged against any other series.
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IN WITNESS WHEREOF, the parties hereto have caused these Standard Terms and
Conditions of Trust, Dated May 29, 1997 to be duly executed.
JOHN NUVEEN & CO. INCORPORATED,
Depositor
By
-----------------------------------
THE CHASE MANHATTAN BANK,
Evaluator and Trustee
By
-----------------------------------
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EXHIBIT 1.1(b)
NUVEEN UNIT TRUST, SERIES 4
TRUST INDENTURE AND AGREEMENT
Dated: May 29, 1997
This Trust Indenture and Agreement by and between John Nuveen & Co.
Incorporated, as Depositor and The Chase Manhattan Bank, as Trustee, sets forth
certain provisions in full and incorporates other provisions by reference to the
document entitled "Standard Terms and Conditions of Trust for Nuveen Unit Trust,
Series 4 and certain subsequent Series, effective May 29, 1997" (herein called
the "STANDARD TERMS AND CONDITIONS OF TRUST"), and such provisions as are set
forth in full and such provisions as are incorporated by reference constitute a
single instrument. All references herein to Articles and Sections are to
Articles and Sections of the Standard Terms and Conditions of Trust.
WITNESSETH THAT:
In consideration of the promises and of the mutual agreements herein
contained, the Depositor and the Trustee, 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(1) listed in Schedule A
hereto have been deposited in trust under this Trust Indenture and
Agreement.
(b) The fractional undivided interest in and ownership of the Trust
Fund represented by each Unit for a Trust on the Initial Date of Deposit is
the amount set forth under the captions "Essential Information - Fractional
Undivided Interest per Unit" in the Prospectus.
<PAGE>
(c) The number of Units created of a Trust are as set forth under the
caption "Essential Information - Initial Number of Units" in the Prospectus
for each Trust.
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IN WITNESS WHEREOF, John Nuveen & Co. Incorporated, has caused this Trust
Indenture and Agreement for Nuveen Unit Trust, Series 4 to be executed by its
President, one of its Vice Presidents or one of its Assistant Vice Presidents
and its corporate seal to be hereto affixed and attested by its Secretary or its
Assistant Secretary and The Chase Manhattan Bank has caused this Trust Indenture
and Agreement to be executed by one of its Vice Presidents or Second Vice
Presidents and its corporate seal to be hereto affixed and attested to by one of
its Assistant Treasurers; all as of the day, month and year first above written.
JOHN NUVEEN & CO. INCORPORATED,
Depositor
By
----------------------------
Authorized Officer
(Seal)
Attest:
By
----------------------------
Assistant Secretary
THE CHASE MANHATTAN BANK, TRUSTEE
By
----------------------------
Second Vice President
(Seal)
Attest:
By
----------------------------
Assistant Treasurer
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SCHEDULE A TO THE TRUST INDENTURE AND AGREEMENT
SECURITIES INITIALLY DEPOSITED
IN
NUVEEN UNIT TRUST, SERIES 4
(Note: Incorporated herein and made a part hereof is the "Schedule of
Investments" as set forth for each Trust in the Prospectus.)
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EXHIBIT 3.1
May 29, 1997
John Nuveen & Co. Incorporated
333 West Wacker Drive
Chicago, Illinois 60606
Re: Nuveen Unit Trust, Series 4
---------------------------
Gentlemen:
We have served as counsel for you, as depositor of Nuveen Unit Trust,
Series 4 (hereinafter referred to as the "FUND"), in connection with the
issuance under the Trust Indenture and Agreement dated the date hereof between
John Nuveen & Co. Incorporated, as Depositor, and The Chase Manhattan Bank, as
Trustee, of Units of fractional undivided interest in the one or more Trusts of
said Fund (hereinafter referred to as the "UNITS").
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 Indenture and Agreement and
the establishment of book entry positions and the execution and issuance of
certificates evidencing the Units in the Trust of the Fund have been duly
authorized; and
2. The book entry positions and certificates evidencing the Units in each
Trust of the Fund when duly established or duly executed and delivered by the
Depositor and the Trustee in accordance with the aforementioned Trust Indenture
and Agreement, will constitute valid and binding obligations of such Trusts 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. 333-25225) 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.
Respectfully submitted,
CHAPMAN AND CUTLER
EFF:mbk
<PAGE>
EXHIBIT 3.2
May 29, 1997
John Nuveen & Co. Incorporated
333 West Wacker Drive
Chicago, Illinois 60606
The Chase Manhattan Bank
Nuveen Administration Department
4 New York Plaza, Third Floor
New York, New York 10004-2413
Re: Nuveen Unit Trust, Series 4 consisting of:
Nuveen - Standard & Poor's Quality Equity Portfolio, Series 1, May 1997
-----------------------------------------------------------------------
Gentlemen:
We have acted as counsel for John Nuveen & Co. Incorporated, as Sponsor and
Depositor of Nuveen Unit Trust, Series 4 (the "Fund") consisting of Nuveen -
Standard & Poor's Quality Equity Portfolio, Series 1, May 1997 (the "Trust"), in
connection with the issuance of Units of fractional undivided interest in the
Trust, under a Trust Indenture and Agreement dated May 29, 1997 (the
"Indenture") between John Nuveen & Co. Incorporated, as Depositor, and The Chase
Manhattan Bank, as Trustee and Evaluator.
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 we have deemed pertinent.
The opinions expressed herein assume that the Trust will be administered, and
investments by the Trust from proceeds of subsequent deposits, if any, will be
made, in accordance with the terms of the Indenture. The Trust holds Securities
as such term is defined in the Prospectus. The assets of the Trust will consist
of a portfolio of equity securities (the "Securities") as set forth in the
Prospectus. For purposes of this opinion, it is assumed that each Security is
equity for federal income tax purposes.
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. The Trust is not an association taxable as a corporation for Federal
income tax purposes but will be governed by the provisions of subchapter J
(relating to Trusts) of Chapter 1, Internal Revenue Code of 1986 (the "Code");
each Unitholder will be treated as
<PAGE>
the owner of a pro rata portion of each of the assets of the Trust, in the
proportion that the number of Units held by him bears to the total number of
Units outstanding; under Subpart E, Subchapter J of Chapter 1 of the Code,
income of the Trust will be treated as income of the Unitholders in the
proportion described above; and an item of Trust income will have the same
character in the hands of a Unitholder as it would have in the hands of the
Trustee. Each Unitholder will be considered to have received his pro rata share
of income derived from each Trust asset when such income is received by the
Trust. A Unitholder's pro rata portion of dividends as defined by Section 316
of the Code, paid by a corporation with respect to a security held by the Trust
is taxable as ordinary income to the extent of such corporation's current and
accumulated "earnings and profits." A Unitholder's pro rata portion of
dividends paid on such security which exceeds such current and accumulated
earnings and profits will first reduce a Unitholder's tax basis in such Equity
Security, and to the extent that such dividends exceed a Unitholder's tax basis
in such Security, shall be treated as gain from the sale or exchange of
property.
II. The price a Unitholder pays for his Units generally including sales
charges, is allocated among his pro rata portion of each Security held by such
Trust (in proportion to the fair market values thereof on the valuation date
closest to the date the Unitholder purchases his Units), in order to determine
his tax basis for his pro rata portion of each Security held by such Trust.
III. Gain or loss will be recognized to a Unitholder (subject to various
nonrecognition provisions under the Code) upon redemption or sale of his Units,
except to the extent an in kind distribution of stock is received by such
Unitholder from the Trust as discussed below. Such gain or loss is measured by
comparing the proceeds of such redemption or sale with the adjusted basis of his
Units. Before adjustment, such basis would normally be cost if the Unitholder
had acquired his Units by purchase. Such basis will be reduced, but not below
zero, by the Unitholder's pro rata portion of dividends with respect to each
Security which is not taxable as ordinary income.
IV. If the Trustee disposes of a Trust asset (whether by sale, exchange,
liquidation, redemption, payment on maturity or otherwise) gain or loss will be
recognized to the Unitholder (subject to various nonrecognition provisions under
the Code) and the amount thereof will be measured by comparing the Unitholder's
aliquot share of the total proceeds from the transaction with his basis for his
fractional interest in the asset disposed of. Such basis is ascertained by
apportioning the tax basis for his Units (as of the date on which his Units were
acquired) among each of the Trust assets (as of the date on which his Units were
acquired) ratably according to their values as of the valuation date nearest the
date on which he purchased such Units. A Unitholder's basis in his Units and of
his fractional interest in each Trust asset must be reduced, but not below zero,
by the Unitholder's pro rata portion of dividends with respect to each Security
which are not taxable as ordinary income.
-2-
<PAGE>
V. Under the Indenture, under certain circumstances, a Unitholder
tendering Units for redemption may request an in kind distribution of Securities
upon the redemption of Units or upon the termination of the Trust. As
previously discussed, prior to the redemption of Units or the termination of the
Trust, a Unitholder is considered as owning a pro rata portion of each of the
Trust's assets. The receipt of an in kind distribution will result in a
Unitholder receiving an undivided interest in whole shares of stock and possibly
cash. The potential federal income tax consequences which may occur under an in
kind distribution with respect to each Security owned by the Trust will depend
upon whether or not a United States Unitholder receives cash in addition to
Securities. A "Security" for this purpose is a particular class of stock issued
by a particular corporation. A Unitholder will not recognize gain or loss if a
Unitholder only receives Securities in exchange for his or her pro rata portion
in the Securities held by the Trust. However, if a Unitholder also receives
cash in exchange for a fractional share of a Security held by the Trust, such
Unitholder will generally recognize gain or loss based upon the difference
between the amount of cash received by the Unitholder and his tax basis in such
fractional share of a Security held by the Trust. The total amount of taxable
gains (or losses) recognized upon such redemption will generally equal the sum
of the gain (or loss) recognized under the rules described above by the
redeeming Unitholder with respect to each Security owned by the Trust.
A domestic corporation owning Units in the Trust may be eligible for the
70% dividends received deduction pursuant to Section 243(a) of the Code with
respect to such Unitholder's pro rata portion of dividend's received by the
Trust (to the extent such dividends are taxable as ordinary income, as discussed
above, and are attributable to domestic corporations), subject to the
limitations imposed by Sections 246 and 246A of the Code. It should be noted
that various legislative proposals that would affect the dividend received
deduction have been introduced.
Section 67 of the Code provides that certain miscellaneous itemized
deductions, such as investment expenses, tax return preparation fees and
employee business expenses will be deductible by an individual only to the
extent they exceed 2% of such individual's adjusted gross income. Unitholders
may be required to treat some or all of the expenses of a Trust as miscellaneous
itemized deductions subject to this limitation.
A Unitholder will recognize taxable gain (or loss) when all or part of the
pro rata interest in a Security is either sold by the Trust or redeemed or when
a Unitholder disposes of his Units in a taxable transaction, in each case for an
amount greater (or less) than his tax basis therefor.
Any gain or loss recognized on a sale or exchange will, under current law,
generally be capital gain or loss.
-3-
<PAGE>
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 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. 333-25225) 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:mbk
<PAGE>
EXHIBIT 3.3
Carter Ledyard & Milburn
2 Wall Street
New York, New York 10005
May 29, 1997
Nuveen Unit Trust,
Nuveen - Standard & Poor's Quality Equity Portfolio,
Series 1, May 1997
c/o The Chase Manhattan Bank,
as Trustee
4 New York Plaza, 3rd Floor
New York, New York 10004
Re: Nuveen Unit Trust,
Nuveen - Standard & Poor's Quality Equity Portfolio,
Series 1, May 1997
------------------------------------------------------------------
Dear Sirs:
We are acting as special counsel with respect to New York tax matters
for Nuveen Unit Trust, Nuveen - Standard & Poor's Quality Equity Portfolio,
Series 1, May 1997 (the "Trust Fund"), which will be established under a
Standard Terms and Conditions of Trust for Nuveen Unit Trusts Series 4 and
subsequent and a related Trust Indenture and Agreement (such Standard Terms
and Conditions of Trust and related Trust Indenture and Agreement are
referred to collectively as the "Indenture"), each dated today's date and
between John Nuveen & Co. Incorporated, as Depositor (the "Depositor"), and
The Chase Manhattan Bank, as Trustee (the "Trustee"). Pursuant to the terms
of the Indenture, units of fractional undivided interest in the
<PAGE>
Nuveen Unit Trust -2-
Trust Fund will be issued (the "Units"), which Units may, in accordance with
the Indenture, be represented by a certificate or certificates (the
"Certificates").
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 Fund 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 Fund will be considered the income of the holders of the
Units.
3. By reason of the exemption contained in paragraph (a) of Subdivision
8 of Section 270 of the New York Tax Law, no New York State stock transfer
tax will be payable in respect of any transfer of the Certificates.
We consent to the filing of this opinion as an exhibit to the
Registration Statement (No. 333-25225) 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 "Tax Status" and "Legal
Opinion" in such Registration Statement and the preliminary prospectus
included therein.
Very truly yours,
SFL:tbm
<PAGE>
EXHIBIT 3.4
Carter Ledyard & Milburn
2 Wall Street
New York, New York 10005
May 29, 1997
The Chase Manhattan Bank,
as Trustee of
Nuveen Unit Trust,
Nuveen - Standard & Poor's Quality Equity Portfolio,
Series 1, May 1997
4 New York Plaza, 3rd Floor
New York, New York 10004
Attention: Mr. Michael J. Locascio
Vice President
-------------------------------------------
Re: Nuveen Unit Trust, Nuveen - Standard & Poor's Quality Equity
Portfolio, Series 1, May 1997
--------------------------------------------------------------
Dear Sirs:
We are acting as counsel for The Chase Manhattan Bank ("Chase") in
connection with the execution and delivery of a Standard Terms and Conditions
of Trust for Nuveen Unit Trusts Series 4 and subsequent and a related Trust
Indenture and Agreement (such Standard Terms and Conditions of Trust and
related Trust Indenture and Agreement are collectively referred to as the
"Indenture"), each dated today's date and between John Nuveen & Co.
Incorporated, as Depositor (the "Depositor"), and Chase, as Trustee (the
"Trustee"), establishing the Nuveen Unit Trust, Nuveen - Standard & Poor's
Quality Equity Portfolio, Series 1, May 1997 (the "Trust Fund"), and the
confirmation by Chase, as Trustee under the Indenture, that it has caused to
be credited to the Depositor's account at The Depository Trust Company a
number of units constituting the entire interest in the Trust Fund (such
aggregate units being herein called "Units") each of which represents an
undivided interest in the Trust Fund, which consists of common
<PAGE>
The Chase Manhattan Bank -2-
stocks (including confirmations of contracts for the purchase of certain
stock not yet delivered and cash, cash equivalents or an irrevocable letter
of credit in the amount required for such purchase upon the receipt of such
stock), such stocks being defined in the Indenture as Securities and
referenced in the schedules to the Indenture.
We have examined the Indenture, the Closing Memorandum executed and
delivered today by the Depositor and the Trustee (the "Closing Memorandum"),
the form of certificate for the Units included in the Indenture and a
specimen of the certificates to be issued thereunder (the "Certificates") 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 Indenture has been duly executed and delivered by Chase and,
assuming due execution and delivery by the Depositor, 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 Fund the ownership of the Units by The Depository Trust Company, where
it has caused the Units to be credited to the account of 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 cause the Units to be
transferred on the registration books of the Trust Fund to such other names,
and in such denominations, as the Depositor may order, and may deliver
Certificates evidencing such ownership, as provided in the Closing Memorandum.
5. Chase, as Trustee, may lawfully advance amounts to the Trust Fund and
may be reimbursed, without interest, for any such advances from funds in the
income and capital accounts, 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,
SFL:tbm
<PAGE>
EXHIBIT 4.2
The Chase Manhattan Bank
4 New York Plaza, 6th Floor
New York, NY 10004
John Nuveen & Co., Incorporated May 29, 1997
33 West Wacker Drive
Chicago, Illinois 60606
Re: Nuveen Unit Trust
Nuveen-Standard & Poor's Quality Equity Portfolio,
Series 1, May 1997
Dear Sirs:
The Chase Manhattan Bank is acting as Evaluator for the series of Nuveen
Unit Trust set forth above (the "Trust"). We enclose a list of the Securities
to be deposited in the Trust on the date hereof. The prices indicated
therein reflect our evaluation of such Securities as of the close of business
on May 28, 1997 in accordance with the valuation method set forth in the
Standard Terms and Conditions of Trust for Nuveen Unit Trust Series 4 and
subsequent. We consent to the reference to The Chase Manhattan Bank as the
party performing the evaluations of the Trust Securities in the Registration
Statement (No. 333-25225) filed with the Securities And Exchange Commission
with respect to the registration of the sale of the Trust Units and to the
filing of this consent as an exhibit thereto.
Very Truly Yours,
/s/ Thomas J. Controne
---------------------------------
Thomas J. Controne
Vice President
<PAGE>
EXHIBIT 4.4
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our
report and to all references to our Firm included in or made a part of this
Registration Statement.
ARTHUR ANDERSEN LLP
Chicago, Illinois
May 29, 1997
<PAGE>
MEMORANDUM
NUVEEN UNIT TRUST, SERIES 4
FILE NO. 333-25225
The Prospectus and the Indenture filed with Amendment No. 1 of the
Registration Statement on Form S-6 have been revised to reflect information
regarding the execution of the Indenture and the deposit of securities on May
29, 1997 and to set forth certain statistical data based thereon. In addition,
there are a number of other changes from the Prospectus as originally filed to
which reference is made, including the increase in the size of the Fund, a
corresponding increase in the number of Units and a change in the individual
trusts constituting the Fund. All references to the Units, prices and related
statistical data will apply to each trust of the Fund and the Units thereof
individually.
Except for such updating, an effort has been made to set forth below each
of the changes and also to reflect the same by redlining the marked counterparts
of the Prospectus submitted with the Amendment.
FORM S-6
FACING SHEET. The file number is now shown.
THE PROSPECTUS
PART A - PAGES 2-3. Essential information for each of the Trusts,
including applicable footnotes, has been completed for this Series.
PART A - PAGES 2-3. The date of the Indenture has been inserted along with
the size and number of Units of each of the Trusts.
PART A - PAGE 1-11 et seq. The following information for each Trust
appears on the pages relating to such trust:
<PAGE>
The estimated daily accrual of interest under the plans of distribution for
each of the Trusts
Data regarding the composition of the portfolio of each Trust
The schedule of investments for each Trust, including the notes thereto
The record dates and distribution dates for interest distributions for each
Trust
The Statements of Condition for each Trust and the Accountant's Report with
regard thereto
The amount of the Trustee's fee
CHAPMAN AND CUTLER
Chicago, Illinois
May 29, 1997
-2-
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information extracted from the Nuveen
- -- Standard & Poor's Quality Equity Portfolio, Series 1, May 1997 which is
incorporated in the Prospectus dated and is qualified in its entirety by
reference to such prospectus.
</LEGEND>
<SERIES>
<NUMBER> 001
<NAME> Nuveen-Standard & Poor's Quality Equity Portfolio, Series 1, May 1997
<S> <C>
<PERIOD-TYPE> OTHER
<FISCAL-YEAR-END> JUL-15-98
<PERIOD-END> JUL-15-98
<INVESTMENTS-AT-COST> 2,999,743
<INVESTMENTS-AT-VALUE> 3,003,489
<RECEIVABLES> 0
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 3,078,989
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 128,592
<TOTAL-LIABILITIES> 128,592
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 0
<SHARES-COMMON-STOCK> 303,382
<SHARES-COMMON-PRIOR> 0
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<NET-ASSETS> 3,003,489
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<INTEREST-INCOME> 0
<OTHER-INCOME> 0
<EXPENSES-NET> 0
<NET-INVESTMENT-INCOME> 0
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<DISTRIBUTIONS-OF-INCOME> 0
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<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
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<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 0
<ACCUMULATED-NII-PRIOR> 0
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<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 9.90
<PER-SHARE-NII> 0
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<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
