Registration No. 333-34343
1940 Act No. 811-05903
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 1 to
Form S-6
FOR REGISTRATION UNDER THE SECURITIES ACT OF 1933 OF SECURITIES
OF UNIT INVESTMENT TRUSTS REGISTERED ON FORM N-8B-2
A. Exact name of trust:
The First Trust Special Situations Trust, Series 215
B. Name of depositor:
NIKE SECURITIES L.P.
C. Complete address of depositor's principal executive offices:
NIKE SECURITIES L.P.
1001 Warrenville Road
Lisle, Illinois 60532
D. Name and complete address of agent for service:
Copy to:
JAMES A. BOWEN ERIC F. FESS
c/o Nike Securities L.P. c/o Chapman and Cutler
1001 Warrenville Road 111 West Monroe Street
Lisle, Illinois 60532 Chicago, Illinois 60603
E. Title and Amount of Securities Being Registered:
An indefinite number of Units pursuant to Rule 24f-2
promulgated under the Investment Company Act of 1940, as amended
F. Proposed Maximum Aggregate Offering Price to the Public of
the Securities Being Registered:
Indefinite
G. Amount of Filing Fee:$00.00*
H. Approximate date of proposed sale to public:
As soon as practicable after the effective date of the
Registration Statement.
|XXX|Check box if it is proposed that this filing will become
effective on August 27, 1997 at 2:00 p.m. pursuant to Rule
487.
________________________________
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 215
Cross-Reference Sheet
(Form N-8B-2 Items required by Instructions as
to the Prospectus in Form S-6)
FORM N-8B-2 ITEM NUMBER FORM S-6 HEADING IN PROSPECTUS
I. ORGANIZATION AND GENERAL INFORMATION
1. (a) Name of trust Prospectus front cover
(b) Title of securities issued Summary of Essential
Information
2. Name and address of each depositor Information as to
Sponsor, Trustee and
Evaluator
3. Name and address of trustee Information as to
Sponsor, Trustee and
Evaluator
4. Name and address of principal Information as to
underwriters Sponsor, Trustee and
Evaluator
5. State of organization of trust The First Trust
Special Situations
Trust
6. Execution and termination of Other Information
trust agreement
7. Changes of name *
8. Fiscal year *
9. Litigation *
II. GENERAL DESCRIPTION OF THE TRUST AND SECURITIES OF THE TRUST
10. (a) Registered or bearer Public Offering
securities
(b) Cumulative or distributive The First Trust
securities Special Situations
Trust
(c) Redemption Rights of Unitholders
(d) Conversion, transfer, etc. Rights of Unitholders
(e) Periodic payment plan *
(f) Voting rights Rights of Unitholders
(g) Notice of certificateholders Other Information
(h) Consents required Rights of Unitholders;
Other Information
(i) Other provisions The First Trust
Special Situations
Trust
11. Types of securities comprising The First Trust
units Special
Situations Trust
Schedule of
Investments
12. Certain information regarding
periodic payment certificates *
13. (a) Load, fees, expenses, etc. Summary of Essential
Information; Public
Offering; The First
Trust Special
Situations Trust
(b) Certain information regarding
periodic payment certificates *
(c) Certain percentages Summary of Essential
Information; The
First Trust Special
Situations Trust;
Public Offering
(d) Certain other fees, etc.
payable by holders Rights of Units
Holders
(e) Certain profits receivable
by depositor, principal,
underwriters, trustee or The First Trust
affiliated persons Special
Situations Trust
(f) Ratio of annual charges *
to income
14. Issuance of trust's securities Rights of Unit Holders
15. Receipt and handling of payments
from purchasers *
16. Acquisition and disposition of
underlying securities The First Trust
Special Situations
Trust; Rights of Unit
Holders;
17. Withdrawal or redemption The First Trust
Special Situations
Trust; Public
Offering; Rights of
Unit Holders
18. (a) Receipt, custody and Rights of Unit Holders
disposition of income
(b) Reinvestment of distributions Rights of Unit Holders
(c) Reserves or special funds Information as to
Sponsor, Trustee and
Evaluator
(d) Schedule of distributions *
19. Records, accounts and reports Rights of Unit Holders
20. Certain miscellaneous provisions
of trust agreement
(a) Amendment Other Information
(b) Termination Other Information
(c) and (d) Trustee, removal Information as
and successor to Sponsor, Trustee
and Evaluator
(e) and (f) Depositor, removal Information as
and successor to Sponsor, Trustee
and Evaluator
21. Loans to security holders *
22. Limitations on liability The First Trust
Special Situations
Trust;
Information as to
Sponsor, Trustee
and Evaluator
23. Bonding arrangements Contents of
Registration
Statement
24. Other material provisions *
of trust agreement
III. ORGANIZATION, PERSONNEL AND AFFILIATED PERSONS OF DEPOSITOR
25. Organization of depositor Information as to
Sponsor, Trustee and
Evaluator
26. Fees received by depositor *
27. Business of depositor Information as to
Sponsor, Trustee and
Evaluator
28. Certain information as to
officials and affiliated *
persons of depositor
29. Voting securities of depositor *
30. Persons controlling depositor *
31. Payment by depositor for certain
services rendered to trust *
32. Payment by depositor for certain
other services rendered to trust *
33. Remuneration of employees of
depositor for certain services
rendered to trust *
34. Remuneration of other persons
for certain services rendered *
to trust
IV. DISTRIBUTION AND REDEMPTION
35. Distribution of trust's Public Offering
securities by states
36. Suspension of sales of trust's
securities *
37. Revocation of authority to *
distribute
38. (a) Method of distribution Public Offering
(b) Underwriting agreements Public Offering
(c) Selling agreements Public Offering
39. (a) Organization of principal Information as
underwriters to Sponsor, Trustee
and Evaluator
(b) N.A.S.D. membership of
principal underwriters Information as to
Sponsor, Trustee and
Evaluator
40. Certain fees received by See Items 13(a) and
principal underwriters 13(e)
41. (a) Business of principal Information as to
underwriters Sponsor, Trustee and
Evaluator
(b) Branch offices of
principal underwriters *
(c) Salesmen of principal *
underwriters
42. Ownership of trust's securities
by certain persons *
43. Certain brokerage commissions
received by principal *
underwriters
44. (a) Method of valuation Summary of Essential
Information; The
First Trust Special
Situations Trust,
Public Offering
(b) Schedule as to offering *
price
(c) Variation in offering Public Offering
price to certain persons
45. Suspension of redemption rights *
46. (a) Redemption valuation Rights of Unit Holders
(b) Schedule as to redemption *
price
47. Maintenance of position in Public Offering;
underlying securities Rights
of Unit Holders
V. INFORMATION CONCERNING THE TRUSTEE OR CUSTODIAN
48. Organization and regulation of Information as
trustee to Sponsor, Trustee
and Evaluator
49. Fees and expenses of trustee The First Trust
Special Situations
Trust
50. Trustee's lien The First Trust
Special Situations
Trust
VI. INFORMATION CONCERNING THE INSURANCE OF HOLDERS OF
SECURITIES
51. Insurance of holders of
trust's ecurities *
VII. POLICY OF REGISTRANT
52. (a) Provisions of trust The First Trust
agreement with respect to Special
selection or elimination of Situations Trust;
underlying securities Rights of Unit Holders
(b) Transactions involving
elimination of underlying *
securities
(c) Policy regarding substitution The First Trust
or elimination of underlying Special
securities Situations Trust;
Rights of Unit Holders
(d) Fundamental policy not
otherwise covered *
53. Tax status of Trust The First Trust
Special Situations
Trust
VIII. FINANCIAL AND STATISTICAL INFORMATION
54. Trust's securities during *
last ten years
55.
56.
57. Certain information regarding
period payment certificates *
58.
59. Financial statements Report of Independent
(Instruction 1(c) to Statement of Net
Assets
Form S-6 Auditors
* Inapplicable, answer negative or not required.
First Trust (registered trademark)
NEW CENTURY GROWTH & TREASURY SECURITIES TRUST
The Trust. The First Trust (registered trademark) Special Situations
Trust, Series 215, New Century Growth & Treasury Securities Trust (the
"Trust") is a unit investment trust consisting of a portfolio of common
stocks and zero coupon U.S. Treasury bonds.
The objective of the New Century Growth & Treasury Securities Trust is
to protect Unit holders' capital and provide potential capital
appreciation by investing a portion of its portfolio in zero coupon U.S.
Treasury bonds ("Treasury Obligations") and the remainder of the Trust's
portfolio in common stocks of companies which are strategically
positioned to capitalize on the most significant trends of the twenty-
first century ("Equity Securities"). Collectively, the Treasury
Obligations and the Equity Securities are referred to herein as the
"Securities." The Treasury Obligations evidence the right to receive a
fixed payment at a future date from the U.S. Government and are backed
by the full faith and credit of the U.S. Government. The guarantee of
the U.S. Government does not apply to the market value of the Treasury
Obligations or the Units of the Trust, whose net asset value will
fluctuate and, prior to maturity, may be worth more or less than a
purchaser's acquisition cost. The Trust is intended to achieve its
objective over the life of the Trust and as such, is best suited for
those investors capable of holding such Units to maturity. See "Schedule
of Investments" for the Trust. There is, of course, no guarantee that
the objective of the Trust will be achieved. The Trust has a mandatory
termination date (the "Mandatory Termination Date") as set forth under
"Summary of Essential Information."
Each Unit of the Trust represents an undivided fractional interest in
all the Securities deposited in the Trust. The Trust has been organized
so that purchasers of Units should receive, at the termination of the
Trust, an amount per Unit at least equal to approximately $7.80 (which is
equal to the per Unit value upon maturity of the Treasury Obligations),
even if the Trust never paid a dividend and the value of the Equity
Securities were to decrease to zero, which the Sponsor considers highly
unlikely. As a result of the volatile nature of the market
for zero coupon U.S. Treasury bonds, Units sold or redeemed prior to
maturity will fluctuate in price and the underlying Treasury Obligations
may be valued at a price greater or less than their value as of the Initial
Date of Deposit. In addition, to the extent Treasury Obligations are sold
by the Trust to pay expenses or to meet redemption requests, Unit holders
may not receive approximately $7.80 per Unit at the Trust's termination.
UNIT HOLDERS DISPOSING OF THEIR UNITS PRIOR TO THE MATURITY OF THE TRUST
MAY RECEIVE MORE OR LESS THAN APPROXIMATELY $7.80 PER UNIT, DEPENDING ON
MARKET CONDITIONS ON THE DATE UNITS ARE SOLD OR REDEEMED.
UNITS OF THE TRUST ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY,
ANY BANK, AND UNITS ARE NOT FEDERALLY INSURED OR OTHERWISE PROTECTED BY
THE FEDERAL DEPOSIT INSURANCE CORPORATION AND INVOLVE INVESTMENT RISK
INCLUDING LOSS OF PRINCIPAL.
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.
The Ohio Company
The date of this Prospectus is August 27, 1997
Page 1
The Treasury Obligations deposited in the Trust on the Initial Date of
Deposit will mature on November 15, 2004 (the "Treasury Obligations
Maturity Date"). The Equity Securities deposited in the Trust's
portfolio have no fixed maturity date and the value of these underlying
Equity Securities will fluctuate with changes in the values of stocks in
general and with changes in the conditions and performance of the
specific Equity Securities owned by the Trust. See "Portfolio."
Pursuant to the Indenture, the Sponsor may, from time to time during a
period of up to approximately 360 days after the Initial Date of Deposit,
deposit additional Securities in the Trust or cash (including a letter of
credit) with instructions to purchase additional Securities in the Trust,
provided it maintains the original percentage relationship between the
Treasury Obligations and Equity Securities in the Trust's portfolio. Such
deposits of additional Securities will, therefore, be done in such a manner
that the maturity value of each Unit should always be an amount at least
equal to approximately $7.80, and that the original proportionate
relationship amongst the individual issues of the Equity Securities in the
Trust shall be maintained. Any deposit by the Sponsor of additional
Securities or the purchase of additional Securities pursuant to a cash
deposit, will duplicate, as nearly as is practicable, the original
proportionate relationship established on the Initial Date of Deposit, and
not the actual proportionate relationship on the subsequent date of deposit,
since the two may differ. Any such difference may be due to the sale,
redemption or liquidation of any Securities deposited in the Trust on the
Initial, or any subsequent, Date of Deposit. See "What is the First Trust
Special Situations Trust?" and "How May Securities be Removed from the Trust?"
Public Offering Price. The Public Offering Price per Unit of the Trust
during the initial offering period is equal to a pro rata share of the
offering prices of the Treasury Obligations and the aggregate underlying
value of the Equity Securities in the Trust (generally determined by the
closing sale prices of listed Equity Securities and the ask prices of
over-the-counter traded Equity Securities) plus or minus a pro rata
share of cash, if any, in the Capital and Income Accounts of the Trust.
A pro rata share of accumulated dividends, if any, in the Income Account
is included in the Public Offering Price.
Dividend and Capital Distributions. Distributions of dividends and
capital, if any, received by the Trust will be paid in cash on the
Distribution Date to Unit holders of record on the Record Date as set
forth in the "Summary of Essential Information." Distributions of funds
in the Capital Account, if any, will be made at least annually in
December of each year. Any distribution of income and/or capital will be
net of the expenses of the Trust. INCOME WITH RESPECT TO THE ACCRUAL OF
ORIGINAL ISSUE DISCOUNT ON THE TREASURY OBLIGATIONS IN THE TRUST WILL
NOT BE DISTRIBUTED CURRENTLY, ALTHOUGH UNIT HOLDERS OF THE TRUST WILL BE
SUBJECT TO INCOME TAX AT ORDINARY INCOME RATES AS IF A DISTRIBUTION HAD
OCCURRED. See "What is the Federal Tax Status of Unit Holders?" Any Unit
holder may elect to have each distribution of income or capital on his
or her Units automatically reinvested in additional Units of the Trust.
Additionally, upon termination of the Trust, the Trustee will
distribute, upon surrender of Units for redemption, to each Unit holder
his pro rata share of the Trust's assets, less expenses, in the manner
set forth under "Rights of Unit Holders-How are Income and Capital
Distributed?"
Termination. Commencing on the Treasury Obligations Maturity Date for
the Trust, Equity 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 Equity Securities. Written
notice of any termination of the Trust specifying the time or times at
which Unit holders may surrender their certificates for cancellation
shall be given by the Trustee to each Unit holder at his address
appearing on the registration books of the Trust maintained by the
Trustee. At least 60 days prior to the Treasury Obligations Maturity
Date for the Trust, the Trustee will provide written notice thereof to
all Unit holders and will include with such notice a form to enable Unit
holders to elect a distribution of shares of Equity Securities (reduced
by customary transfer and registration charges) if such Unit holder owns
at least 2,500 Units of the Trust, rather than to receive payment in
cash for such Unit holder's pro rata share of the amounts realized upon
the disposition by the Trustee of Equity Securities. All Unit holders of
the Trust will receive their pro rata portion of the Treasury
Obligations in cash upon the termination of the Trust. To be effective,
the election form, together with surrendered certificates and other
documentation required by the Trustee, must be returned to the Trustee
at least five business days prior to the Treasury Obligations Maturity
Date for the Trust. Unit holders not electing a distribution of shares
of Equity Securities will receive a cash distribution from the sale of
the remaining Securities within a reasonable time after the Trust is
terminated. See "Rights of Unit Holders-How are Income and Capital
Distributed?"
Risk Factors. An investment in the 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
Page 2
the issuers of the Equity Securities which make up the Trust or the
general condition of the stock market, volatile interest rates and
economic recession. Unit holders 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 Trust is not actively
managed and Securities will not be sold by the Trust to take advantage
of market fluctuations or changes in anticipated rates of appreciation.
See "What are Equity Securities?-Risk Factors."
Page 3
Summary of Essential Information
At the Opening of Business on the Initial Date of Deposit
of the Securities-August 27, 1997
Underwriter: The Ohio Company
Sponsor: Nike Securities L.P.
Trustee: The Chase Manhattan Bank
Evaluator: First Trust Advisors L.P.
<TABLE>
<CAPTION>
<S> <C>
General Information
Aggregate Maturity Value of Treasury Obligations Initially Deposited $117,000
Initial Number of Units (1) 15,000
Fractional Undivided Interest in the Trust per Unit (1) 1/15,000
Public Offering Price:
Aggregate Offering Price Evaluation of Securities in Portfolio (1) $149,783
Aggregate Offering Price Evaluation of Securities per Unit $ 9.9855
Sales Charge (2) $ 0.0000
Public Offering Price per Unit (3) $ 9.9855
Sponsor's Initial Repurchase Price per Unit $ 9.9855
Redemption Price per Unit (based on bid price evaluation of underlying
Treasury Obligations and aggregate underlying value of Equity Securities)
($.0068 less than Public Offering Price per Unit;
$.0068 less than Sponsor's Initial Repurchase Price per Unit) (4) $ 9.9787
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
CUSIP Number 337183 289
First Settlement Date September 2, 1997
Treasury Obligations Maturity Date November 15, 2004
Mandatory Termination Date November 15, 2004
Trustee's Annual Fee $.0075 per Unit outstanding.
Evaluator's Annual Fee $.0025 per Unit outstanding. Evaluations for purposes of sale, purchase or
redemption of Units are made as of the close of trading (generally 4:00
p.m. Eastern time) on the New York Stock Exchange on each day on which it
is open.
Supervisory Fee (5) Maximum of $.0025 per Unit outstanding annually payable to an affiliate of
the Sponsor.
Estimated Annual Amortization of
Organizational and Offering Costs (6) $.0020 per Unit.
Income Distribution Record Date Fifteenth day of each June, commencing June 15, 1998.
Income Distribution Date (7) Last day of each June, commencing June 30, 1998.
</TABLE>
[FN]
______________
(1) As of the close of business on the Initial Date of Deposit, the
portfolio of the Trust may be adjusted so that the Aggregate Offering
Price Evaluation of Securities in Portfolio will equal $10,000,000. Each
Equity Security listed on a national securities exchange or The Nasdaq
Stock Market is valued at the last closing sale price, or if no such
price exists or if the Equity Security is not so listed, at the closing
ask price thereof. The Treasury Obligations are valued at their
aggregate offering side evaluation.
(2) The purchaser of Trust Units will pay to the Sponsor a one-time
structuring fee of $175,000, of which $100,000 will be paid to the
Underwriter.
(3) 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 Equity
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 Equity Securities will 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) See "How May Units be Redeemed?"
(5) In addition, the Sponsor may also be reimbursed for bookkeeping and
other administrative expenses currently at a maximum annual rate of
$.0028 per Unit.
(6) The Trust (and therefore Unit holders) will bear all or a portion of
its organizational and offering costs (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 the Trust portfolio and the initial fees
and expenses of the Trustee but not including the expenses incurred in
the printing of preliminary and final prospectuses, and expenses
incurred in the preparation and printing of brochures and other
advertising materials and any other selling expenses) as is common for
mutual funds. Total organizational and offering expenses will be charged
off over a period not to exceed five years from the Initial Date of
Deposit. See "What are the Expenses and Charges?" and "Statement of Net
Assets." Historically, the sponsors of unit investment trusts have paid
all the costs of establishing such trusts.
(7) Distributions from the Capital Account, if any, will be made monthly
on the last day of the month to Unit holders of record on the fifteenth
day of such month if the amount available for distribution equals at
least $1.00 per 100 Units. Notwithstanding, distributions of funds in
the Capital Account, if any, will be made in December of each year.
Page 4
NEW CENTURY GROWTH & TREASURY SECURITIES TRUST
The First Trust Special Situations Trust, Series 215
What is The First Trust Special Situations Trust?
The First Trust Special Situations Trust, Series 215 is one of a series
of investment companies created by the Sponsor under the name of The
First Trust Special Situations Trust, all of which are generally similar
but each of which is separate and is designated by a different series
number. This Series consists of underlying separate unit investment
trust designated as: New Century Growth & Treasury Securities Trust (the
"Trust"). The Trust was created under the laws of the State of New York
pursuant to a Trust Agreement (the "Indenture"), dated the Initial Date
of Deposit, with Nike Securities L.P., as Sponsor, The Chase Manhattan
Bank, as Trustee and First Trust Advisors L.P., as Portfolio Supervisor
and Evaluator.
On the Initial Date of Deposit, the Sponsor deposited with the Trustee
confirmations of contracts for the purchase of zero coupon U.S. Treasury
bonds and common stocks, together with an irrevocable letter or letters
of credit of a financial institution in an amount at least equal to the
purchase price of such securities. In exchange for the deposit of
securities or contracts to purchase securities in the Trust, the Trustee
delivered to the Sponsor documents evidencing the entire ownership of
such Trust.
The objective of the Trust is to protect Unit holders' capital and
provide potential capital appreciation by investing a portion of its
portfolio in zero coupon U.S. Treasury bonds ("Treasury Obligations")
and the remainder of the Trust's portfolio in common stocks of companies
which are strategically positioned to capitalize on the most significant
trends of the twenty-first century ("Equity Securities"). Collectively,
the Treasury Obligations and the Equity Securities are referred to
herein as the "Securities." See "Schedule of Investments." The Trust has
a Mandatory Termination Date as set forth under "Summary of Essential
Information." The Treasury Obligations evidence the right to receive a
fixed payment at a future date from the U.S. Government and are backed
by the full faith and credit of the U.S. Government. The guarantee of
the U.S. Government does not apply to the market value of the Treasury
Obligations or the Units of the Trust, whose net asset values will
fluctuate and, prior to maturity, may be worth more or less than a
purchaser's acquisition cost. There is, of course, no guarantee that the
objective of the Trust will be achieved.
With the deposit of the Securities in the Trust on the Initial Date of
Deposit, the Sponsor established a percentage relationship between the
principal amounts of Treasury Obligations and Equity Securities in the
Trust's portfolio. From time to time following the Initial Date of
Deposit, the Sponsor, pursuant to the Indenture, may deposit additional
Securities in the Trust or cash (including a letter of credit) with
instructions to purchase additional Securities in the Trust and Units may be
continuously offered for sale to the public by means of this Prospectus,
resulting in a potential increase in the outstanding number of Units of
the Trust. Any additional Securities, or cash (including a letter of credit)
with instructions to purchase additional Securities in the Trust,
deposited in the Trust will maintain, as nearly as is practicable, the
original proportionate relationship of the Treasury Obligations and Equity
Securities in the Trust's portfolio. Such deposits of additional Securities
in the Trust will, therefore, be done in such a manner that the maturity
value of the Treasury Obligations represented by each Unit should always be
an amount at least equal to approximately $7.80, and that the original
proportionate relationship amongst the individual issues of the Equity
Securities shall be maintained. Any such difference may be due to the sale,
redemption or liquidation of any of the Securities deposited in the Trust on
the Initial or any subsequent Date of Deposit. See "How May Securities be
Removed from the Trust?" The prices of the underlying Treasury Obligations
and Equity Securities in the Trust will fluctuate daily and the ratio, on a
market value basis, will also change daily. 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. The maturity value of the Treasury Obligations and the
portion of Equity Securities represented by each Unit of the Trust will not
change as a result of the deposit of additional Securities in the Trust.
On the Initial Date of Deposit, each Unit of the Trust represented the
undivided fractional interest in the Securities deposited in the Trust
set forth under "Summary of Essential Information." The Trust has been
organized so that purchasers of Units should receive, at the termination
of the Trust, an amount per Unit at least equal to approximately $7.80 per Unit
(which is equal to the per Unit value upon maturity of the Treasury
Page 5
Obligations), even if the Equity Securities never paid a dividend and
the value of the Equity Securities in the Trust were to decrease to
zero, which the Sponsor considers highly unlikely. Furthermore, the
Sponsor will take such steps in connection with the deposit of
additional Securities in the Trust as are necessary to maintain a
maturity value of the Units of the Trust at least equal to approximately
$7.80 per Unit. The receipt of only approximately $7.80 per Unit upon
the termination of the Trust (an event which the Sponsor believes is
unlikely) represents a substantial loss on a present value basis. At
current interest rates, the present value of receiving $7.80 per Unit as
of the termination of the Trust would be approximately $4.94 per Unit
(the present value is indicated by the amount per Unit which is invested in
Treasury Obligations). Furthermore, the approximately $7.80 per Unit in no
respect protects investors against diminution in the purchasing power of
their investment due to inflation (although expectations concerning
inflation are a component in determining prevailing interest rates, which
in turn determine present values). If inflation were to occur at the rate
of 5% per annum during the period ending at the termination of the Trust,
the present dollar value of $7.80 per Unit at the termination of the Trust
would be approximately $5.44 per Unit. To the extent that Units of the
Trust are redeemed, the aggregate value of the Securities in the Trust
will be reduced and the undivided fractional interest represented by
each outstanding Unit of the Trust will increase. However, if additional
Units are issued by the Trust in connection with the deposit of
additional Securities or cash by the Sponsor, the aggregate value of the
Securities in the Trust will be increased by amounts allocable to
additional Units, and the fractional undivided interest represented by
each Unit of the Trust will be decreased proportionately. See "How May
Units be Redeemed?"
What are the Expenses and Charges?
With the exception of bookkeeping and other administrative services
provided to the Trust, for which the Sponsor may be reimbursed in
amounts as set forth under "Summary of Essential Information," the
Sponsor will not receive any fees in connection with its activities
relating to the Trust. Certain of the expenses incurred in establishing
the Trust, including the cost of the initial preparation of documents
relating to the Trust, Federal and state registration fees, the initial
fees and expenses of the Trustee, legal expenses and any other out-of-
pocket expenses may be paid by the Sponsor, and may, in part, be paid by
the Trustee.
First Trust Advisors L.P., an affiliate of the Sponsor, will receive an
annual supervisory fee, which is not to exceed the amount set forth
under "Summary of Essential Information," for providing portfolio
supervisory services for the Trust. Such fee is based on the number of
Units outstanding in the Trust on January 1 of each year, except for the
year or years in which an initial offering period occurs, in which case
the fee for a month is based on the number of Units outstanding at the
end of such month. In providing such supervisory services, the Portfolio
Supervisor may purchase research services from a variety of sources
which may include the Underwriter.
Subsequent to the initial offering period, First Trust Advisors L.P., an
affiliate of the Sponsor, in its capacity as Evaluator for the Trust,
will receive a fee as indicated under "Summary of Essential Information."
The Trustee pays certain expenses of the Trust for which it is
reimbursed by the Trust. The Trustee will receive for its ordinary
recurring services to the Trust an annual fee as set forth in "Summary
of Essential Information." Such fee will be based upon the largest
aggregate number of Units of the Trust outstanding at any time during
the year. For a discussion of the services performed by the Trustee
pursuant to its obligations under the Indenture, reference is made to
the material set forth under "Rights of Unit Holders."
The Trustee's and above described fees are payable from the Income
account of the Trust to the extent funds are available, and then from
the Capital Account of the Trust. Since the Trustee has the use of the
funds being held in the Capital and Income Accounts for payment of
expenses and redemptions and since such Accounts are non-interest
bearing to Unit holders, the Trustee benefits thereby. Part of the
Trustee's compensation for its services to the Trust is expected to
result from the use of these funds.
Each of the above mentioned fees may be increased without approval of
the Unit holders by amounts not exceeding proportionate increases under
the category "All Services Less Rent of Shelter" in the Consumer Price
Page 6
Index published by the United States Department of Labor. In addition,
with respect to the fees payable to the Sponsor or an affiliate of the
Sponsor for providing bookkeeping and other administrative services,
supervisory services and evaluation services, such individual fees may
exceed the actual costs of providing such services for the Trust, but at
no time will the total amount received for such services rendered to all
unit investment trusts of which Nike Securities L.P. is the Sponsor in
any calendar year exceed the actual cost to the Sponsor or its affiliate
of supplying such services in such year.
Certain or all of the expenses incurred in establishing the Trust,
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 the
Trust portfolio and the initial fees and expenses of the Trustee and any
other out-of-pocket expenses, will be paid by the Trust and charged off
over a period not to exceed five years from the Initial Date of Deposit.
The following additional charges are or may be incurred by the Trust:
all legal and annual auditing expenses of the Trustee incurred by or in
connection with its responsibilities under the Indenture; the expenses
and costs of any action undertaken by the Trustee to protect the Trust
and the rights and interests of the Unit holders; fees of the Trustee
for any extraordinary services performed under the Indenture;
indemnification of the Trustee for any loss, liability or expense
incurred by it without negligence, bad faith or willful misconduct on
its part, arising out of or in connection with its acceptance or
administration of the Trust; indemnification of the Sponsor for any
loss, liability or expense incurred without gross negligence, bad faith
or willful misconduct in acting as Depositor of the Trust; all taxes and
other government charges imposed upon the Securities or any part of the
Trust (no such taxes or charges are being levied or made or, to the
knowledge of the Sponsor, contemplated). The above expenses and the
Trustee's annual fee, when paid or owing to the Trustee, are secured by
a lien on the Trust. In addition, the Trustee is empowered to sell
Securities in the Trust in order to make funds available to pay all
these amounts if funds are not otherwise available in the Income and
Capital Accounts of the Trust except that the Trustee shall not sell
Treasury Obligations to pay Trust expenses. Since the Equity Securities
are all common stocks and the income stream produced by dividend
payments is unpredictable, the Sponsor cannot provide any assurance that
dividends will be sufficient to meet any or all expenses of the Trust.
As described above, if dividends are insufficient to cover expenses, it
is likely that Equity Securities will have to be sold to meet the
Trust's expenses. These sales may result in capital gains or losses to
Unit holders. See "What is the Federal Tax Status of Unit Holders?"
The Indenture requires the Trust to be audited on an annual basis at the
expense of the Trust by independent auditors selected by the Sponsor. So
long as the Sponsor is making a secondary market for the Units of the
Trust, the Sponsor is required to bear the cost of such annual audit to
the extent such cost exceeds $0.0050 per Unit for the Trust. Unit
holders of the Trust covered by an audit may obtain a copy of the
audited financial statements upon request.
What is the Federal Tax Status of Unit Holders?
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"). Unit holders 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 the Trust. For purposes
of the following discussion and opinions it is assumed that each Equity
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 Unit holder 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 Unit
holders thereof under the Code. Each Unit holder will be considered to
have received each pro rata share of income derived from each Trust
asset when such income is received by the Trust.
2. Each Unit holder will be considered to have received all of the
dividends paid on his pro rata portion of each Equity Security when such
dividends are considered to be received by the Trust. Unit holders will
be taxed in this manner regardless of whether distributions from the
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Trust are actually received by the Unit holder or are automatically
reinvested.
3. Each Unit holder will have a taxable event when the Trust disposes
of an Equity Security (whether by sale, exchange, liquidation,
redemption, or payment at maturity) or upon the sale or redemption of
Units by such Unit holder. The price a Unit holder pays for his Units,
including sales charges, is allocated among his pro rata portion of each
Security held by the Trust (in proportion to the fair market values
thereof on the valuation date nearest the date the Unit holder purchases
his Units) in order to determine his tax basis for his pro rata portion
of each Security held by such Trust. The Treasury Obligations held by
the Trust are treated as stripped bonds and may be treated as bonds
issued at an original issue discount as of the date a Unit holder
purchases his Units. Because the Treasury Obligations represent
interests in "stripped" U.S. Treasury bonds, a Unit holder's tax basis
for his pro rata portion of each Treasury Obligation held by the Trust
shall be treated as its "purchase price" by the Unit holder. Original
issue discount is effectively treated as interest for Federal income tax
purposes and the amount of original issue discount in this case is
generally the difference between the bond's purchase price and its
stated redemption price at maturity. A Unit holder of the Trust will be
required to include in gross income for each taxable year the sum of his
daily portions of original issue discount attributable to the Treasury
Obligations held by the Trust as such original issue discount accrues
and will in general be subject to Federal income tax with respect to the
total amount of such original issue discount that accrues for such year
even though the income is not distributed to the Unit holders during
such year to the extent it is not less than a "de minimis" amount as
determined under Treasury Regulations relating to stripped bonds. To the
extent the amount of such discount is less than the respective "de
minimis" amount, such discount shall be treated as zero. In general,
original issue discount accrues daily under a constant interest rate
method which takes into account the semi-annual compounding of accrued
interest. In the case of the Treasury Obligations, this method will
generally result in an increasing amount of income to the Unit holders
of the Trust each year. Unit holders of the Trust should consult their
tax advisers regarding the Federal income tax consequences and accretion
of original issue discount under the stripped bond rules. For Federal
income tax purposes, a Unit holder's pro rata portion of dividends, as
defined by Section 316 of the Code, paid by a corporation with respect
to an Equity Security held by the Trust are taxable as ordinary income
to the extent of such corporation's current and accumulated "earnings
and profits." A Unit holder's pro rata portion of dividends paid on such
Equity Security which exceed such current and accumulated earnings and
profits will first reduce a Unit holder's tax basis in such Equity
Security, and to the extent that such dividends exceed a Unit holder's
tax basis in such Equity Security shall generally be treated as capital
gain. In general, any such capital gain will be short-term unless a Unit
holder has held his Units for more than one year.
4. A Unit holder's portion of gain, if any, upon the sale or
redemption of Units or the disposition of Securities held by the Trust
will generally be considered a capital gain except in the case of a
dealer or a financial institution. A Unit holder'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. Unit holders
should consult their tax advisers regarding the recognition of such
capital gains and losses for Federal income tax purposes.
Dividends Received Deduction. A Unit holder will be considered to have
received all of the dividends paid on his pro rata portion of each
Equity Security when such dividends are received by the Trust. Unit
holders will be taxed in this manner regardless of whether distributions
from the Trust are actually received by the Unit holder or are
automatically reinvested.
A corporation that owns Units will generally be entitled to a 70%
dividends received deduction with respect to such Unit holder'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 Equity Securities paying such dividends (other than
corporate shareholders, 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%
Page 8
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
been recently issued which address special rules that must be considered
in determining whether the 46-day holding requirement is met. Moreover,
the allowable percentage of the deduction will be reduced from 70% if a
corporate Unit holder 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. Unit
holders should consult with their tax advisers with respect to the
limitations on and possible modifications to the dividends received
deduction. To the extent dividends received by the Trust are
attributable to foreign corporations, a corporation that owns Units will
not be entitled to the dividends received deduction with respect to its
pro rata portion of such dividends, since the dividends received
deduction is generally available only with respect to dividends paid by
domestic corporations.
Recognition of Taxable Gain or Loss Upon Disposition of Securities by
the Trust or Disposition of Units. As discussed above, a Unit holder may
recognize taxable gain (or loss) when an Equity Security is disposed of
by the Trust or if the Unit holder disposes of a Unit. For taxpayers
other than corporations, net capital gains (which are defined as net
long-term capital gain over net short-term capital loss for the taxable
year) are subject to a maximum marginal stated tax rate of either 28% or
20%, depending upon the holding period of the capital assets. In
particular, net capital gain, excluding net gain from property held more
than one year but not more than 18 months and gain on certain other
assets, is subject to a maximum marginal stated tax rate of 20% (10% in
the case of certain taxpayers in the lowest tax bracket). Net capital
gain that is not taxed at the maximum marginal stated tax rate of 20%
(or 10%) as described in the preceding sentence, is generally subject to
a maximum marginal stated tax rate of 28%. The date on which a Unit is
acquired (i.e., the "trade date") is excluded for purposes of
determining the holding period of the Unit. 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.
In addition, please note that capital gains may be recharacterized as
ordinary income in the case of certain financial transactions that are
considered "conversion transactions" effective for transactions entered
into after April 30, 1993. Unit holders and prospective investors should
consult with their tax advisers regarding the potential effect of this
provision on their investment in Units.
The Taxpayer Relief Act of 1997 (the "1997 Act") includes provisions
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). Unit holders should
consult their own tax advisers with regard to any such constructive
sales rules.
Limitations on Deductibility of Trust Expenses by Unit holders. Each
Unit holder's pro rata share of each expense paid by the Trust is
deductible by the Unit holder to the same extent as though the expense
had been paid directly by him. 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. Unit holders
may be required to treat some or all of the expenses of the Trust as
miscellaneous itemized deductions subject to this limitation.
If the Unit holder 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 involved including his or her pro rata portion of all the
Equity Securities represented by the Unit. The 1997 Act includes
provisions that would treat certain transactions designed to reduce or
eliminate risk of loss and opportunities for gain (e.g., short sales,
off setting notional principal contracts, futures or forward contracts,
or similar transactions) as constructive sales for purposes of
recognition of gain (but not loss) and for purposes of determining the
holding period. Unit holders should consult their own tax advisers with
regard to any such constructive sales rules.
Special Tax Consequences of In-Kind Distributions Upon Termination of
the Trust. As discussed in "Rights of Unit Holders-How are Income and
Capital Distributed?", under certain circumstances a Unit holder who
owns at least 2,500 Units of the Trust may request an In-Kind
Distribution upon the termination of the Trust. The Unit holder
requesting an In-Kind Distribution will be liable for expenses related
thereto (the "Distribution Expenses") and the amount of such In-Kind
Page 9
Distribution will be reduced by the amount of the Distribution Expenses.
See "Rights of Unit Holders-How are Income and Capital Distributed?"
Treasury Obligations held by the Trust will not be distributed to a Unit
holder as part of an In-Kind Distribution. The tax consequences relating
to the sale of Treasury Obligations are discussed above. As previously
discussed, prior to the termination of the Trust, a Unit holder is
considered as owning a pro rata portion of each of the Trust assets for
Federal income tax purposes. The receipt of an In-Kind Distribution upon
the termination of the Trust would be deemed an exchange of such Unit
holder's pro rata portion of each of the shares of stock and other
assets held by the Trust in exchange for 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 the Unit holder receives cash in
addition to Equity Securities. A "Security" for this purpose is a
particular class of stock issued by a particular corporation (and does
not include the Treasury Obligations). A Unit holder will not recognize
gain or loss if a Unit holder only receives Equity Securities in
exchange for his or her pro rata portion in the Equity Securities held
by the Trust. However, if a Unit holder also receives cash in exchange
for a fractional share of an Equity Security held by the Trust, such
Unit holder will generally recognize gain or loss based upon the
difference between the amount of cash received by the Unit holder and
his tax basis in such fractional share of an Equity Security held by the
Trust.
Because the Trust will own many Securities, a Unit holder 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
Unit holder with respect to each Security owned by the Trust. Unit
holders who request an In-Kind Distribution are advised to consult their
tax advisers in this regard.
Computation of the Unit holder's Tax Basis. Initially, a Unit holder's
tax basis in his Units will generally equal the price paid by such Unit
holder for his Units. The cost of the Units is allocated among the
Equity Securities held in the Trust in accordance with the proportion of
the fair market values of such Equity Securities on the date the Units
are purchased in order to determine such Unit holder's tax basis for his
pro rata portion of each Equity Security.
A Unit holder's tax basis in his Units and his pro rata portion of an
Equity Security held by the Trust will be reduced to the extent
dividends paid with respect to such Equity Security are received by the
Trust which are not taxable as ordinary income as described above.
General. Each Unit holder will be requested to provide the Unit holder's
taxpayer identification number to the Trustee and to certify that the
Unit holder has not been notified by the Internal Revenue Service that
payments to the Unit holder are subject to back-up withholding. If the
proper taxpayer identification number and appropriate certification are
not provided when requested, distributions by the Trust to such Unit
holder (including amounts received upon the redemption of Units) will be
subject to back-up withholding. Distributions by the Trust 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 (accrual of original
issue discount on the Treasury Obligations in the Trust may not be
subject to taxation or withholding provided certain requirements are
met). Such persons should consult their tax advisers.
Unit holders will be notified annually of the amounts of original issue
discount and income dividends includable in the Unit holder's gross
income and amounts of Trust expenses which may be claimed as itemized
deductions.
Unit holders 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 "Why are Investments in the Trust Suitable for
Retirement Plans?"
The foregoing discussion relates only to United States federal income
taxes. Unit holders may be subject to state and local taxation in other
jurisdictions. Unit holders should consult their tax advisers regarding
potential state or local taxation with respect to the Units.
In the opinion of Carter, Ledyard & Milburn, Special Counsel to the
Trust for New York tax matters, under the existing income tax laws of
the State of New York, the Trust is not an association taxable as a
corporation and the income of the Trust will be treated as the income of
the Unit holders thereof.
Page 10
Why are Investments in the Trust Suitable for Retirement Plans?
Units of the Trust may be well suited for purchase by Individual
Retirement Accounts, Keogh Plans, pension funds and other tax-deferred
retirement plans. Generally, the Federal income tax relating to capital
gains and income received in each of the foregoing plans is deferred
until 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.
PORTFOLIO
What are Treasury Obligations?
The Treasury Obligations deposited in the Trust consist of U.S. Treasury
bonds which have been stripped of their unmatured interest coupons. The
Treasury Obligations evidence the right to receive a fixed payment at a
future date from the U.S. Government, and are backed by the full faith
and credit of the U.S. Government. Treasury Obligations are purchased at
a deep discount because the buyer obtains only the right to a fixed
payment at a fixed date in the future and does not receive any periodic
interest payments. The effect of owning deep discount bonds which do not
make current interest payments (such as the Treasury Obligations) is
that a fixed yield is earned not only on the original investment, but
also, in effect, on all earnings during the life of the discount
obligation. This implicit reinvestment of earnings at the same rate
eliminates the risk of being unable to reinvest the income on such
obligations at a rate as high as the implicit yield on the discount
obligation, but at the same time eliminates the holder's ability to
reinvest at higher rates in the future. For this reason, the Treasury
Obligations are subject to substantially greater price fluctuations
during periods of changing interest rates than are securities of
comparable quality which make regular interest payments. The effect of
being able to acquire the Treasury Obligations at a lower price is to
permit more of the Trust's portfolio to be invested in Equity Securities.
What are Equity Securities?
The Trust consists of different issues of Equity Securities, all of
which are listed on a national securities exchange, The Nasdaq Stock
Market or are traded in the over-the-counter market.
The Equity Securities of the New Century Growth & Treasury Securities
Trust consist of common stocks of companies which are strategically
positioned to capitalize on the most significant trends of the twenty-
first century.
See "What are the Equity Securities Selected for New Century Growth &
Treasury Securities Trust?" for a general description of the companies.
Risk Factors. An investment in Units of the Trust should be made with an
understanding of the risks such an investment may entail.
The Trust consists of such Securities listed under "Schedule of
Investments" as may continue to be held from time to time in the Trust
and any additional Securities acquired and held by the Trust pursuant to
the provisions of the Trust Agreement together with cash held in the
Income and Capital Accounts. Neither the Sponsor nor the Trustee shall
be liable in any way for any failure in any of the Securities. However,
should any contract for the purchase of any of the Securities initially
deposited hereunder fail, the Sponsor will, unless substantially all of
the moneys held in the Trust to cover such purchase are reinvested in
substitute Securities in accordance with the Trust Agreement, refund the
cash attributable to such failed contract to all Unit holders on the next
distribution date.
Because certain of the Equity Securities from time to time may be sold
under certain circumstances described herein, and because the proceeds
from such events will be distributed to Unit holders and will not be
reinvested, no assurance can be given that the Trust will retain for any
length of time its present size and composition. Although the Portfolio
is not managed, the Sponsor may instruct the Trustee to sell Equity
Securities under certain limited circumstances. Pursuant to the
Indenture and with limited exceptions, the Trustee may sell any
securities or other property acquired in exchange for Equity Securities
such as those acquired in connection with a merger or other transaction.
Page 11
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 the Trust, they may be accepted for
deposit in the Trust and either sold by the Trustee or held in such
Trust pursuant to the direction of the Sponsor (who may rely on the
advice of the Portfolio Supervisor). See "How May Securities be Removed
from the Trust?" Equity Securities, however, will not be sold by the
Trust to take advantage of market fluctuations or changes in anticipated
rates of appreciation or depreciation.
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 Equity Securities or the
general condition of the common stock market may worsen and the value of
the Equity 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 creditors of, or
holders of debt obligations or preferred stocks of, such issuers.
Shareholders of common stocks of the type held by the Trust have a right
to receive 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 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 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 Equity 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. 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.
Whether or not the Equity Securities are listed on a national securities
exchange, the principal trading market for the Equity Securities may be
in the over-the-counter market. As a result, the existence of a liquid
trading market for the Equity Securities may depend on whether dealers
will make a market in the Equity Securities. There can be no assurance
that a market will be made for any of the Equity Securities, that any
market for the Equity Securities will be maintained or of the liquidity
of the Equity Securities in any markets made. In addition, the Trust may
be restricted under the Investment Company Act of 1940 from selling
Equity Securities to the Sponsor. The price at which the Equity
Securities may be sold to meet redemptions, and the value of the Trust,
will be adversely affected if trading markets for the Equity Securities
are limited or absent.
Unit holders will be unable to dispose of any of the Equity Securities
in the Portfolio, as such, and will not be able to vote the Equity
Securities. As the holder of the Equity Securities, the Trustee will
have the right to vote all of the voting stocks in the Trust and will
vote such stocks in accordance with the instructions of the Sponsor.
What are the Equity Securities Selected for New Century Growth &
Treasury Securities Trust?
The Underwriter has acquired or will acquire the Equity Securities for
the Sponsor and thereby benefits from transaction fees. The Underwriter
in its general securities business acts as agent or principal in
connection with the purchase and sale of equity securities, including
the Equity Securities in the Trust, and may act as a market maker in
certain of the Equity Securities. The Underwriter also from time to time
may issue reports on and make recommendations relating to equity
securities, which may include the Equity Securities.
Page 12
BASIC MATERIALS
E.I. du Pont de Nemours & Company, headquartered in Wilmington,
Delaware, explores for, develops and produces crude oil and natural gas;
makes polymers, elastomers, finishes and performance films; makes
specialty fibers and chemicals; produces agricultural products; and
makes electronic materials and medical products.
Monsanto Company, headquartered in St. Louis, Missouri, with
subsidiaries, makes and sells a diversified line of chemical products;
agricultural products, pharmaceuticals and food ingredients.
CAPITAL GOODS
The Boeing Company, headquartered in Seattle, Washington, develops,
produces and markets commercial jet transports and provides related
support services, principally to commercial customers; and researches,
develops, produces, modifies and supports military aircraft and
helicopters and related systems, space systems and missile systems.
Caterpillar Inc., headquartered in Peoria, Illinois, through
subsidiaries, makes earthmoving construction, materials-handling
machinery and equipment and diesel engines. The company also provides
various financial products and services.
Deere & Company, headquartered in Moline, Illinois, makes and
distributes agricultural equipment, industrial equipment, and commercial
and consumer equipment. The company also provides credit services,
property and casualty insurance and health management programs.
Emerson Electric Co., headquartered in St. Louis, Missouri, through
segments, designs, makes and sells electrical, electromechanical and
electronic products and systems.
General Electric Company, headquartered in Fairfield, Connecticut, makes
major appliances, industrial and power systems, aircraft engines,
engineered plastics, silicones, superabrasives, laminates and technical
products; furnishes TV network services; produces TV programs and
operates 11 VHF and UHF TV stations. The company also provides financial
services.
Hillenbrand Industries Inc., headquartered in Batesville, Indiana,
through wholly-owned subsidiaries, makes caskets and other products for
the funeral industry; provides funeral planning insurance products; and
makes healthcare equipment and provides wound care and pulmonary/trauma
management services. The company also makes high security locks and
access control products for commercial and industrial use.
Tyco International Ltd., headquartered in Exeter, New Hampshire, through
its subsidiaries, makes and sells disposable medical supplies and other
specialty products, fire protection systems, flow control products and
electrical and electronic components.
United States Filter Corporation, headquartered in Palm Desert,
California, provides water treatment systems, services and replacement
parts to industrial and commercial customers in the water treatment
industry. The company also offers outsourcing options to its customers,
including operation of systems and the provision of water by the gallon.
COMMUNICATIONS
Pacific Gateway Exchange, Inc., headquartered in Burlingame, California,
provides international telecommunications services primarily to its
target customer base of long distance service providers worldwide,
including five of the seven largest U.S.-based long distance carriers.
Worldcom, Inc., headquartered in Jackson, Mississippi, through its
subsidiaries, provides long distance and local telecommunications
products, 800 services, calling cards, domestic and international
private lines, broadband data services, debit cards, conference calling,
fax and data connections, and interconnection to Internet service
providers.
CONSUMER CYCLICALS
Consolidated Stores Corporation, headquartered in Columbus, Ohio, buys
and sells large quantities of close-out merchandise, generally obtained
at a fraction of the initial wholesale price, as well as currently
promoted retail toys. The company's merchandise is comprised of new,
mainly brand name products, obtained from manufacturers' excess
inventories and overruns, packaging changes and discontinued goods.
Page 13
Cooper Tire & Rubber Company, headquartered in Findlay, Ohio, makes and
sells automobile and truck tires, inner tubes, vibration control
products, hose and hose assemblies and automotive sealing systems.
Kohl's Corporation, headquartered in Menomonee Falls, Wisconsin,
operates 145 family-oriented, specialty department stores primarily in
the Midwest which sell moderately priced apparel, shoes, accessories,
soft home products and housewares. The company's merchandise is targeted
to middle-income customers shopping for their families and homes.
New York Times Company (Class A), headquartered in New York, New York,
publishes magazines and newspapers, including the "New York Times" and
the "Boston Globe." The company operates broadcasting/information
services such as television, radio stations, news, photo/graphics
services, licenses electronic databases and also has substantial
interests in newsprint companies and paper manufacturing in Canada.
NIKE, Inc. (Class B), headquartered in Beaverton, Oregon, makes and
sells athletic shoes for men, women and children for competitive and
recreational wear designed for specific sports. NIKE, Inc. also sells
sports apparel and accessories and makes and sells hockey equipment.
NIKE, Inc. is not affiliated in any way with Nike Securities L.P., the
Trust's Sponsor.
Service Corporation International, headquartered in Houston, Texas,
operates 2,882 funeral service locations, 345 cemeteries and 150
crematories in North America, Europe and the Pacific Rim. The company
also provides capital financing to independent funeral home and cemetery
operators.
CONSUMER STAPLES
The Coca-Cola Company, headquartered in Atlanta, Georgia, makes and
distributes soft drink concentrates and syrups; markets juice and juice-
drink products; and provides restaurants and institutions with juices
and juice-drink products. The company's products are sold in
approximately 200 countries and include the leading soft drink products
in most of these countries.
The Walt Disney Company, headquartered in Burbank, California, operates
as a diversified international entertainment company with operations
consisting of filmed entertainment, theme parks, resorts and consumer
products. The company also has broadcasting (including Capital
Cities/ABC, Inc.) and publishing operations.
The Gillette Company, headquartered in Boston, Massachusetts, makes
safety razors and blades, shaving creams, deodorants, antiperspirants,
skin care products and shampoos for men and women; alkaline batteries;
Braun electric shavers and small appliances; writing instruments and
correction products; and oral care products. Products are distributed
through wholesalers, retailers and agents in over 200 countries and
territories.
Imax Corporation, headquartered in Mississauga, Ontario, Canada,
designs, makes and markets proprietary projection and sound systems for
theaters using the IMAX system; produces and distributes films shown in
the IMAX theater network; operates 129 theaters in 20 countries; and
designs and supplies motion simulation theaters and produces films for
movie rides.
McDonald's Corporation, headquartered in Oak Brook, Illinois, develops,
franchises, operates and services a worldwide system of 21,022 quick-
service restaurants under the name "McDonald's".
The Procter & Gamble Company, headquartered in Cincinnati, Ohio, through
its subsidiaries, makes detergents, fabric conditioners and hard surface
cleaners; products for personal cleansing, oral care, digestive health,
and hair and skin; paper tissue, disposable diapers and pharmaceuticals;
shortenings, oils, snacks, baking mixes, peanut butter, coffee, drinks
and citrus products.
ENERGY
Amoco Corporation, headquartered in Chicago, Illinois, operates one of
the largest worldwide integrated organizations in the petroleum industry
that explores for, develops and produces crude oil and natural gas;
refines, sells and transports petroleum and related products. The
company also makes and sells chemical products.
Exxon Corporation, headquartered in Irving, Texas, with subsidiaries and
affiliates, explores for, produces, transports and sells crude oil and
natural gas petroleum products; explores for and mines coal and other
minerals properties; makes and sells petrochemicals; and owns interests
in electrical power generation in Hong Kong.
Mobil Corporation, headquartered in Fairfax, Virginia, produces,
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transports, refines and markets petroleum, natural gas and related
products; and makes and markets chemicals.
Schlumberger, Ltd., headquartered in New York, New York, with its
subsidiaries, provides oilfield services to the petroleum industry,
including measurement of physical properties of underground formations;
well testing; pressure measurements; perforating, completion and
workover services; reservoir evaluation; and data services. The company
also makes measurement and systems products.
Transocean Offshore Inc., headquartered in Houston, Texas, provides
contract drilling of oil and gas wells in offshore areas throughout the
world. Offshore contract drilling involves the drilling of wells for oil
and gas located beneath the sea bed.
FINANCIAL
American International Group, Inc., headquartered in New York, New York,
provides a broad range of insurance and insurance-related activities and
financial services in the United States and abroad; and owns and
operates ski slopes and related facilities in Vermont.
Banc One Corporation, headquartered in Columbus, Ohio, through
subsidiaries, conducts a general banking business through 1,500 offices
in Arizona, Colorado, Illinois, Indiana, Kentucky, Louisiana, Ohio,
Oklahoma, Utah, Texas, West Virginia and Wisconsin.
Barnett Banks, Inc., headquartered in Jacksonville, Florida, through its
subsidiaries, operates a general banking business through 622 offices in
Florida and Georgia and provides trust and investment management
services, credit card processing and services, financial advisory
services, reinsurance and consumer loans.
Citicorp, headquartered in New York, New York, through Citibank, N.A.
and other subsidiaries and affiliates, operates a global financial
services organization serving individuals, businesses, governments, and
financial institutions in approximately 3,200 locations (including
branches, representative offices, and subsidiary and affiliate offices)
in 98 countries and territories throughout the world.
Fifth Third Bancorp, headquartered in Cincinnati, Ohio, through
subsidiaries, conducts a general commercial banking business through 411
locations in Florida, Indiana, Kentucky and Ohio. The company also
provides life, accident and health insurance underwriting; real estate
management; discount securities brokerage; and provides electronic funds
transfer and data processing services.
Huntington Bancshares Incorporated, headquartered in Columbus, Ohio,
through subsidiaries, conducts a full-service commercial and consumer
banking business through 338 banking offices in six states and also
provides mortgage banking, lease financing and trust services.
National City Corporation, headquartered in Cleveland, Ohio, operates a
full service commercial banking business. The company owns and operates
11 commercial banks with a total of over 800 banking offices in Indiana,
Kentucky, Ohio and Pennsylvania. The company's five largest subsidiary
banks are National City Bank of Pennsylvania; National City Bank,
Cleveland; National City Bank, Columbus; National City Bank, Indiana;
and National City Bank, Kentucky.
Nationwide Financial Services, Inc., headquartered in Columbus, Ohio,
offers long-term savings and retirement products to retail and
institutional customers throughout the United States. Products offered
include variable and fixed annuities, life insurance, mutual funds,
retirement products and administrative services.
T. Rowe Price Associates, Inc., headquartered in Baltimore, Maryland,
serves as investment adviser to the T. Rowe Price Mutual Funds, other
sponsored investment products, institutional and individual private
accounts and provides certain administrative and shareholder services to
the Price Funds. Total assets under management total over $75 billion.
HEALTHCARE
Amgen, Inc., headquartered in Thousand Oaks, California, a global
biotechnology concern, develops, makes and markets human therapeutics
based on advanced cellular and molecular biology, including a protein
that stimulates red blood cell production and a protein that stimulates
white blood cell production.
Biomet, Inc., headquartered in Warsaw, Indiana, makes and sells
reconstructive and trauma devices, electrical bone growth stimulators,
orthopedic support devices, operating room supplies, powered surgical
instruments, general surgical instruments, arthroscopy products and
craniomaxillofacial products.
Cardinal Health, Inc., headquartered in Dublin, Ohio, through its
subsidiaries, distributes a broad line of pharmaceuticals, surgical and
hospital supplies, therapeutic plasma and other specialty pharmaceutical
products, health and beauty care products and other items typically sold
Page 15
by hospitals, retail drug stores, and other health care providers. The
company also makes, leases and sells point-of-use pharmacy systems;
provides pharmacy management services; and franchises apothecary-style
pharmacies.
HEALTHSOUTH Corporation, headquartered in Birmingham, Alabama, provides
outpatient and rehabilitative healthcare services through its national
network of outpatient and inpatient rehabilitation facilities,
outpatient surgery centers, medical centers and other healthcare
facilities.
Johnson & Johnson, headquartered in New Brunswick, New Jersey, makes and
sells pharmaceuticals, personal health care products, medical and
surgical equipment and contact lenses.
Medtronic, Inc., headquartered in Minneapolis, Minnesota, makes and
sells implantable and invasive therapies, including implantable
pacemaker and tachyarrhythmia management systems, mechanical and tissue
heart valves, balloon and guiding catheters, stents, implantable
neurostimulation and drug delivery systems, and perfusion systems.
Perfusion systems include blood oxygenators, centrifugal blood pumps,
cannula products, and autotransfusion and blood monitoring systems.
Merck & Company, Inc., headquartered in Whitehouse Station, New Jersey,
discovers, develops, makes and markets a broad range of human and animal
health products and services. The company also administers managed
prescription drug programs.
Pfizer, Inc., headquartered in New York, New York, produces and
distributes anti-infectives, anti-inflammatory agents, cardiovascular
agents, antifungal drugs, central nervous system agents, orthopedic
implants, food science products, animal health products, toiletries,
baby care products, dental rinse and other proprietary health items.
TECHNOLOGY
Applied Materials, Inc., headquartered in Santa Clara, California,
develops, makes, sells and services semiconductor wafer fabrication
equipment and related spare parts worldwide. The company also supplies
critical dimension scanning electron microscope systems, and wafer and
reticle inspection systems.
Aspen Technologies, Inc., headquartered in Cambridge, Massachusetts,
supplies off-the-shelf software products and services for the analysis,
design and automation of manufacturing facilities by companies in the
process industries, including the chemicals, petroleum, pharmaceuticals,
pulp and paper, electric power, and food and consumer products industries.
Cisco Systems, Inc., headquartered in San Jose, California, develops,
makes, sells and supports high performance internetworking systems that
link geographically dispersed local-area and wide-area networks to form
a single, seamless information infrastructure.
Compaq Computer Corporation, headquartered in Houston, Texas, makes and
markets desktop personal computers, portable computers, workstations,
communications products, tower PC servers and peripheral products that
store and manage data in network environments. Products are marketed
mainly to business, home, government and education customers. Products
are sold directly to full-service computer specialty dealers for resale
to end-users.
Computer Sciences Corporation, headquartered in El Segundo, California,
provides management consulting and education and research programs in
the strategic use of information resources; designs, develops, and
installs computer-based and communications systems; provides outsourcing
services, consumer credit-related services and automated systems.
Intel Corporation, headquartered in Santa Clara, California, designs,
develops, makes and markets advanced microcomputer components and
related products at various levels of integration. Microcomputer
components are integrated circuits consisting of silicon-based
semiconductors etched with complex patterns of transistors.
Lucent Technologies, headquartered in Murray Hill, New Jersey, is one of
the world's leading designers, developers and manufacturers of
telecommunications systems, software and products, and is a leading
global marketer of business communications systems and computers.
Microsoft Corporation, headquartered in Redmond, Washington, makes,
sells and licenses software products, including operating systems,
server applications, business and consumer products, Internet software
technologies and development tools. The company also markets personal
computer books and input devices, and researches and develops software
technologies. The company is divided into four groups: the Platforms
Product Group; the Applications and Content Product Group; the Sales and
Support Group; and the Operations Group.
Motorola, Inc., headquartered in Schaumburg, Illinois, designs, makes
and sells, mainly under the Motorola brand name, two-way land mobile
Page 16
communication systems, paging and wireless data systems, personal
communications equipment and systems; semiconductors; and electronic
equipment for military and aerospace use. The company also makes
subscriber and infrastructure equipment; cellular mobile and portable
telephones and systems; modems, multiplexers and network processors; and
provides services for paging, cellular telephone, shared mobile radio
and wireless data.
TRANSPORTATION
Federal Express Corporation, headquartered in Memphis, Tennessee,
provides a wide range of express services for the time-definite
transportation of documents, packages and freight throughout the world
using an extensive fleet of aircraft, vehicles and leading-edge
information technologies.
UTILITIES
The Williams Companies, Inc., headquartered in Tulsa, Oklahoma, through
subsidiaries, transports, sells, gathers and processes natural gas;
transports petroleum products; provides telecommunications services; and
provides a variety of other products and services to the energy industry
and financial institutions.
What are Some Additional Considerations for Investors?
Investors should be aware of certain other considerations before making
a decision to invest in the Trust.
The value of the Equity Securities, like the value of the Treasury
Obligations, will fluctuate over the life of the Trust and may be more
or less than the price at which they were deposited in the Trust. The
Equity Securities may appreciate or depreciate in value (or pay
dividends) depending on the full range of economic and market influences
affecting these securities. However, the Sponsor believes that, upon
termination of the Trust, even if the Equity Securities deposited in the
Trust are worthless, an event which the Sponsor considers highly
unlikely, the Treasury Obligations will provide sufficient principal to
at least equal approximately $7.80 per Unit (which is equal to the per
Unit value upon maturity of the Treasury Obligations).
The Sponsor and the Trustee shall not be liable in any way for any
default, failure or defect in any Security. In the event of a notice
that any Treasury Obligations or Equity Securities will not be delivered
("Failed Contract Obligations") to the Trust, the Sponsor is authorized
under the Indenture to direct the Trustee to acquire other Treasury
Obligations or Equity Securities ("Replacement Securities"). Any
Replacement Security deposited in the Trust will, in the case of
Treasury Obligations have the same maturity value and, as closely as can
be reasonably acquired by the Sponsor, the same maturity date or, in the
case of Equity Securities, be identical to those which were the subject
of the failed contract. The Replacement Securities must be purchased
within 20 days after delivery of the notice of a failed contract and the
purchase price may not exceed the amount of funds reserved for the
purchase of the Failed Contract Obligations.
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 Trustee will distribute the principal attributable to
such Failed Contract Obligations 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 such Trust. In addition,
Unit holders should be aware that, at the time of receipt of such
principal, they may not be able to reinvest such proceeds in other
securities at a yield equal to or in excess of the yield which such
proceeds would have earned for Unit holders of the Trust.
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 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 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.
The Trust consists of the Securities listed under "Schedule of
Investments" (or contracts to purchase such Securities) as may continue
to be held from time to time in the Trust and any additional Securities
acquired and held by the Trust pursuant to the provisions of the
Indenture (including provisions with respect to deposits into the Trust
of Securities or cash in connection with the issuance of additional Units).
Page 17
Once all of the Securities in the Trust are acquired, the Trustee will
have no power to vary the investments of the Trust, i.e., the Trustee
will have no managerial power to take advantage of market variations to
improve a Unit holder's investment, and may dispose of Securities only
under limited circumstances. See "How May Securities be Removed from the
Trust?"
To the best of the Sponsor's knowledge, there is no litigation pending
as of the Initial Date of Deposit in respect of any Security which might
reasonably be expected to have a material adverse effect on the Trust.
At any time after the Initial Date of Deposit, litigation may be
instituted on a variety of grounds with respect to the Securities. The
Sponsor is unable to predict whether any such litigation will be
instituted, or if instituted, whether such litigation might have a
material adverse effect on the Trust.
Legislation. From time to time Congress considers proposals to reduce
the rate of the dividends-received deductions. Enactment into law of a
proposal to reduce the rate would adversely affect the after-tax return
to investors who can take advantage of the deduction. Unit holders are
urged to consult their own tax advisers. Further, at any time after the
Initial Date of Deposit, legislation may be enacted, with respect to the
Equity Securities in the Trust or the issuers of the Equity Securities.
Changing approaches to regulation, particularly with respect to the
environment, may have a negative impact on certain companies represented
in the Trust. There can be no assurance that future legislation,
regulation or deregulation will not have a material adverse effect on
the Trust or will not impair the ability of the issuers of the Equity
Securities to achieve their business goals.
PUBLIC OFFERING
How is the Public Offering Price Determined?
Units are offered at the Public Offering Price. During the initial
offering period, the Public Offering Price is based on the aggregate of
the offering side evaluation of the Treasury Obligations in the Trust
and the aggregate underlying value of the Equity Securities in the Trust
(generally determined by the closing sale prices of listed Equity
Securities and the ask prices of over-the-counter traded Equity
Securities), plus or minus cash, if any, in the Income and Capital
Accounts of the Trust divided by the number of Units of the Trust
outstanding.
During the initial offering period, the Sponsor's Repurchase Price is
based on the aggregate of the offering side evaluation of the Treasury
Obligations in the Trust and the aggregate underlying value of the
Equity Securities in the Trust (generally determined by the closing sale
prices of listed Equity Securities and the ask prices of over-the-
counter traded Equity Securities), plus or minus cash, if any, in the
Income and Capital Accounts of the Trust divided by the number of Units
of the Trust outstanding.
Had the Units of the Trust been available for sale on the business day
prior to the Initial Date of Deposit, the Public Offering Price for the
Trust would have been as indicated in "Summary of Essential
Information." The Public Offering Price of Units on the date of the
prospectus or during the initial offering period may vary from the
amount stated under "Summary of Essential Information" in accordance
with fluctuations in the prices of the underlying Securities. During the
initial offering period, the aggregate value of the Units of the Trust
shall be determined (a) on the basis of the offering prices of the
Treasury Obligations and the aggregate underlying value of the Equity
Securities therein plus or minus cash, if any, in the Income and Capital
Accounts of the Trust, (b) if offering prices are not available for the
Treasury Obligations, on the basis of offering prices for comparable
securities, (c) by determining the value of the Treasury Obligations on
the offer side of the market by appraisal, or (d) by any combination of
the above. The aggregate underlying value of the Equity Securities will
be determined in the following manner: If the Equity Securities are
listed on a national securities exchange or The Nasdaq Stock Market,
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 ask prices. If the
Equity Securities are not so listed or, if so listed and the principal
market therefor is other than on the exchange, the evaluation shall
generally be based on the current ask price on the over-the-counter
market (unless it is determined that these prices are inappropriate as a
basis for evaluation). If current ask prices are unavailable, the
evaluation is generally determined (a) on the basis of current ask
prices for comparable securities, (b) by appraising the value of the
Equity Securities on the ask side of the market or (c) by any
combination of the above.
Page 18
Although payment is normally made three business days following the
order for purchase (the date of settlement), payment may be made prior
thereto. A person will become owner of the Units on the date of
settlement provided payment has been received. Cash, if any, made
available to the Sponsor prior to the date of settlement for the
purchase of Units may be used in the Sponsor's business and may be
deemed to be a benefit to the Sponsor, subject to the limitations of the
Securities Exchange Act of 1934. Delivery of Certificates representing
Units so ordered will be made three business days following such order
or shortly thereafter. See "Rights of Unit Holders-How May Units be
Redeemed?" for information regarding the ability to redeem Units ordered
for purchase.
How are Units Distributed?
During the initial offering period (i) for Units issued on the Initial
Date of Deposit and (ii) for additional Units issued after such date as
additional Securities are deposited by the Sponsor, Units will be
distributed to the public at the then current Public Offering Price or
cash. The initial offering period may be up to approximately 360 days.
During such period, the Sponsor may deposit additional Securities or
cash in the Trust and create additional Units. Units reacquired by the
Sponsor during the initial offering period (at prices based upon aggregate
offering price of the Treasury Obligations and the aggregate underlying
value of the Equity Securities in the Trust plus or minus a pro rata
hare of cash, if any, in the Income and Capital Accounts of such Trust)
may be resold at the then current Public Offering Price.
What are the Sponsor's and Underwriter's Profits?
The purchaser of Trust Units will pay to the Sponsor a one-time
structuring fee of $175,000, of which $100,000 will be paid to the
Underwriter. In addition, the Sponsor may be considered to have realized
a profit or to have sustained a loss, as the case may be, in the amount
of any difference between the cost of the Securities to the Trust (which
is based on the Evaluator's determination of the aggregate offering
price of the underlying Securities of the Trust on the Initial Date of
Deposit as well as on subsequent deposits) and the cost of such
Securities to the Sponsor. See Note (2) of "Schedule of Investments" for
the Trust.
RIGHTS OF UNIT HOLDERS
How is Evidence of Ownership Issued and Transferred?
The Trustee is authorized to treat as the record owner of Units that
person who is registered as such owner on the books of the Trustee.
Ownership of Units may be evidenced by registered certificates executed
by the Trustee and the Sponsor. Delivery of certificates representing
Units ordered for purchase is normally made three business days
following such order or shortly thereafter. Certificates are
transferable by presentation and surrender to the Trustee properly
endorsed or accompanied by a written instrument or instruments of
transfer. Certificates to be redeemed must be properly endorsed or
accompanied by a written instrument or instruments of transfer. A Unit
holder must sign exactly as his name appears on the face of the
certificate with the signature guaranteed by a participant in the
Securities Transfer Agents Medallion Program ("STAMP") or such other
signature guaranty program in addition to, or in substitution for,
STAMP, as may be accepted by the Trustee. In certain instances the
Trustee may require additional documents such as, but not limited to,
trust instruments, certificates of death, appointments as executor or
administrator or certificates of corporate authority. Record ownership
may occur before settlement.
Certificates will be issued in fully registered form, transferable only
on the books of the Trustee in denominations of one Unit or any multiple
thereof, numbered serially for purposes of identification.
Unit holders may elect to hold their Units in uncertificated form. The
Trustee will maintain an account for each such Unit holder and will
credit each such account with the number of Units purchased by that Unit
holder. Within two business days of the issuance or transfer of Units
held in uncertificated form, the Trustee will send to the registered
owner of Units a written initial transaction statement containing a
description of the Trust; the number of Units issued or transferred; the
name, address and taxpayer identification number, if any, of the new
registered owner; a notation of any liens and restrictions of the issuer
and any adverse claims to which such Units are or may be subject or a
statement that there are no such liens, restrictions or adverse claims;
and the date the transfer was registered. Uncertificated Units are
Page 19
transferable through the same procedures applicable to Units evidenced
by certificates (described above), except that no certificate need be
presented to the Trustee and no certificate will be issued upon the
transfer unless requested by the Unit holder. A Unit holder may at any
time request the Trustee to issue certificates for Units.
Although no such charge is now made or contemplated, a Unit holder may
be required to pay $2.00 to the Trustee per certificate reissued or
transferred and to pay any governmental charge that may be imposed in
connection with each such transfer or exchange. For new certificates
issued to replace destroyed, stolen or lost certificates, the Unit
holder may be required to furnish indemnity satisfactory to the Trustee
and pay such expenses as the Trustee may incur. Mutilated certificates
must be surrendered to the Trustee for replacement.
How are Income and Capital Distributed?
The Trustee will distribute any net income (other than accreted interest
on the Treasury Obligations) received with respect to any of the
Securities in the Trust on or about the Income Distribution Dates to
Unit holders of record on the preceding Income Record Date. See "Summary
of Essential Information." Because dividends are not received by the
Trust at a constant rate throughout the year, such distributions to Unit
holders may be more or less than the amount credited to the Income
Account as of the Record Date. 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. The pro rata share of cash in the Capital Account of the
Trust will be computed as of the fifteenth day of each month. Proceeds
received on the sale of any Securities in the Trust, to the extent not
used to meet redemptions of Units or pay expenses, will, however, be
distributed on the last day of each month to Unit holders 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 the 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 on the last day of each December to Unit holders of
record as of December 15. Income with respect to the original issue
discount on the Treasury Obligations in the Trust will not be
distributed currently, although Unit holders will be subject to Federal
income tax as if a distribution had occurred. See "What is the Federal
Tax Status of Unit Holders?"
Under regulations issued by the Internal Revenue Service, the Trustee is
required to withhold a specified percentage of any distribution made by
the Trust if the Trustee has not been furnished the Unit holder'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 Unit holder only when filing a tax return. Under
normal circumstances the Trustee obtains the Unit holder's tax
identification number from the selling broker. However, a Unit holder
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 the Trust is terminated, each Unit holder
of the Trust will, upon surrender of his Units for redemption, receive:
(i) the pro rata share of the amounts realized upon the disposition of
Equity Securities, unless he elects an In-Kind Distribution as described
below, (ii) a pro rata share of the amounts realized upon the
disposition of the Treasury Obligations and (iii) a pro rata share of
any other assets of the Trust, less expenses of the Trust, subject to
the limitation that Treasury Obligations may not be sold to pay for
Trust expenses. Not less than 60 days prior to the Treasury Obligations
Maturity Date, the Trustee will provide written notice thereof to all
Unit holders and will include with such notice a form to enable Unit
holders to elect a distribution of shares of Equity Securities (an "In-
Kind Distribution"), if such Unit holder owns at least 2,500 Units of
the Trust, rather than to receive payment in cash for such Unit holder's
pro rata share of the amounts realized upon the disposition by the
Trustee of Equity Securities. An In-Kind Distribution will be reduced by
customary transfer and registration charges. To be effective, the
election form, together with surrendered certificates and other
documentation required by the Trustee, must be returned to the Trustee
at least five business days prior to the Treasury Obligations Maturity
Date. Not less than 60 days prior to the termination of the Trust, those
Unit holders owning at least 2,500 Units will be offered the option of
having the proceeds from the Equity Securities distributed "In-Kind," or
Page 20
they will be paid in cash, as indicated above. A Unit holder may, of
course, at any time after the Equity Securities are distributed, sell
all or a portion of the shares.
The Trustee will credit to the Income Account of the Trust any dividends
received on the Equity 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 the Trust.
Distribution Reinvestment Option. Any Unit holder may elect to have each
distribution of income or capital on his or her Units automatically
reinvested in additional Units of the Trust. Each person who purchases
Units of the Trust may elect to become a participant in the Distribution
Reinvestment Option by notifying the Trustee of his or her election. The
Distribution Reinvestment Option may not be available in all states. In
order to enable a Unit holder to participate in the Distribution
Reinvestment Option with respect to a particular distribution, they must
notify the Trustee of their election at least 10 days prior to the
Record Date for such distribution. Each subsequent distribution of
income or capital on the participant's Units will be automatically
applied by the Trustee to purchase additional Units of the Trust. IT
SHOULD BE REMEMBERED THAT EVEN IF DISTRIBUTIONS ARE REINVESTED, THEY ARE
STILL TREATED AS DISTRIBUTIONS FOR INCOME TAX PURPOSES.
What Reports will Unit Holders Receive?
The Trustee shall furnish Unit holders in connection with each
distribution a statement of the amount of income, if any, and the amount
of other receipts, if any, which are being distributed, expressed in
each case as a dollar amount per Unit. Within a reasonable 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 Unit holder
of the Trust the following information in reasonable detail: (1) a
summary of transactions in the Trust for such year; (2) any Securities
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,
Unit holders will be furnished, upon request to the Trustee, evaluations
of the Securities in the Trust furnished to it by the Evaluator.
How May Units be Redeemed?
A Unit holder may redeem all or a portion of his Units by tender to the
Trustee at its corporate trust office in the City of New York of the
certificates representing the Units to be redeemed, or in the case of
uncertificated Units, delivery of a request for redemption, duly
endorsed or accompanied by proper instruments of transfer with the
signature guaranteed as explained above (or by providing satisfactory
indemnity, as in connection with lost, stolen or destroyed
certificates), and payment of applicable governmental charges, if any.
No redemption fee will be charged. On the third business day following
such tender, the Unit holder will be entitled to receive in cash an
amount for each Unit equal to the Redemption Price per Unit next
computed after receipt by the Trustee of such tender of Units. The "date
of tender" is deemed to be the date on which Units are received by the
Trustee (if such day is a day on which the New York Stock Exchange is
open for trading), except that as regards Units received after 4:00 p.m.
Eastern time (or as of any earlier closing time on a day on which the
New York Stock Exchange is scheduled in advance to close at such earlier
time), the date of tender is the next day on which the New York Stock
Exchange is open for trading and such Units will be deemed to have been
tendered to the Trustee on such day for redemption at the redemption
price computed on that day. Units so redeemed shall be cancelled.
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 Unit
holder'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 Unit holder only when filing
a tax return. Under normal circumstances, the Trustee obtains the Unit
holder's tax identification number from the selling broker. However, any
time a Unit holder elects to tender Units for redemption, such Unit
holder should 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 must be provided at the time redemption is requested.
Page 21
Any amounts paid on redemption representing income shall be withdrawn
from the Income Account of the 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
of the Trust.
The Trustee is empowered to sell Securities of the Trust 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. Equity Securities will be sold to meet
redemptions of Units before Treasury Obligations, although Treasury
Obligations may be sold and therefore, the Trust is not assured of retaining
a sufficient principal amount of Treasury Obligations to provide funds
upon maturity of such Trust at least equal to approximately $7.80 per Unit.
The Redemption Price per Unit will be determined on the basis of the bid
price of the Treasury Obligations and the aggregate underlying value of
the Equity Securities in the Trust plus or minus cash, if any, in the
Income and Capital Accounts of the Trust, while the Public Offering
Price per Unit during the initial offering period will be determined on
the basis of the offering price of such Treasury Obligations, as of the
close of trading on the New York Stock Exchange on the date any such
determination is made and the aggregate underlying value of the Equity
Securities in the Trust, plus or minus cash, if any, in the Income and
Capital Accounts of the Trust. On the Initial Date of Deposit the Public
Offering Price per Unit (which is based on the OFFERING prices of the
Treasury Obligations and the aggregate underlying value of the Equity
Securities in the Trust) exceeded the Unit
value at which Units could have been redeemed (based upon the current
BID prices of the Treasury Obligations and the aggregate underlying
value of the Equity Securities in the Trust) by the amount shown under
"Summary of Essential Information." The Redemption Price per Unit of the
Trust is 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 value of the Securities (including "when
issued" contracts, if any) held in the Trust, as determined by the
Evaluator on the basis of bid prices of the Treasury Obligations and the
aggregate underlying value of the Equity Securities in the Trust next
computed; and (3) dividends receivable on the Equity 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 the Trust; (2) an amount representing estimated accrued
expenses of the Trust, including but not limited to fees and expenses of
the Trustee (including legal and auditing fees), the Evaluator and
supervisory fees, if any; (3) cash held for distribution to Unit holders
of record of the Trust as of the business day prior to the evaluation
being made; and (4) other liabilities incurred by the Trust; and finally
dividing the results of such computation by the number of Units of the
Trust outstanding as of the date thereof.
The aggregate value of the Equity Securities will be determined in the
following manner: if the Equity Securities are listed on a national
securities exchange or The Nasdaq Stock Market, 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 Equity Securities
are not so listed or, if so listed and the principal market therefor is
other than on the exchange, the evaluation shall generally be based on
the current bid price 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 Equity 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 Unit holders 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.
Page 22
How May Units be Purchased by the Sponsor?
The Trustee shall notify the Sponsor of any tender of Units for
redemption. If the Sponsor's bid at that time equals or exceeds the
Redemption Price per Unit, it may purchase such Units by notifying the
Trustee before 1:00 p.m. Eastern time on the same business day and by
making payment therefor to the Unit holder not later than the day on
which the Units would otherwise have been redeemed by the Trustee. Units
held by the Sponsor may be tendered to the Trustee for redemption as any
other Units. In the event the Sponsor does not purchase Units, the
Trustee may sell Units tendered for redemption in the over-the-counter
market, if any, as long as the amount to be received by the Unit holder
is equal to the amount he would have received on redemption of the Units.
The offering price of any Units acquired by the Sponsor will be in
accord with the Public Offering Price described in the then effective
prospectus describing such Units. Any profit or loss resulting from the
redemption of such Units will belong to the Sponsor.
How May Securities be Removed from the Trust?
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 Equity 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 Equity Security, that the issuer of the
Equity 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 Equity Security, that the issuer has
defaulted on the payment on any other of its outstanding obligations,
that the price of the Equity 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 Equity Securities would be detrimental to the
Trust. Treasury Obligations may be sold by the Trustee only pursuant to
the liquidation of the Trust or to meet redemption requests. Except as
stated under "Portfolio-What are Some Additional Considerations for
Investors?" for Failed Contract Obligations, the acquisition by the
Trust of any securities 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 Equity
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 the Trust, they may
be accepted for deposit in the Trust and either sold by the Trustee or
held in the Trust pursuant to the direction of the Sponsor (who may rely
on the advice of the Portfolio Supervisor). Proceeds from the sale of
Securities by the Trustee are credited to the Capital Account of the
Trust for distribution to Unit holders 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 the Trust tendered for redemption and the payment of expenses.
Therefore, to the extent Treasury Obligations are sold, the Trust
is not assured of retaining a sufficient principal amount of Treasury
Obligations to provide funds upon maturity of the Trust at least equal
to approximately $7.80 per Unit.
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 the Trust, it may be
necessary for the Sponsor to specify minimum amounts in which blocks of
Securities are to be sold.
INFORMATION AS TO UNDERWRITER, SPONSOR, TRUSTEE AND EVALUATOR
Who is the Underwriter?
The Ohio Company is a full-service investment banking and brokerage firm
headquartered in Columbus, Ohio with over 50 branch offices spread
throughout Ohio, Florida, Indiana, Michigan and West Virginia. The Ohio
Page 23
Company provides retail brokerage services with over 200 investment
executives and institutional service with eight investment executives. A
wide array of financial services are provided including: equity research
(following approximately 125 companies), Nasdaq and NYSE equity trading
(making markets in over 80 stocks and providing the services of a
dedicated NYSE floor broker), corporate and public finance, taxable and
municipal bond trading desks and asset management (approximately $2.0
billion under active management.)
Founded in 1925, The Ohio Company has a current capital position of
nearly $35 million, ranking near the top of regional securities firms.
The Ohio Company has built and maintained a reputation for over 70 years
of providing high quality investment banking and brokerage service to
institutions, corporations, municipalities and individuals.
Who is the Sponsor?
Nike Securities L.P., the Sponsor, specializes in the underwriting,
trading and distribution of unit investment trusts and other securities.
Nike Securities L.P., an Illinois limited partnership formed in 1991,
acts as Sponsor for successive series of The First Trust Combined
Series, The First Trust Special Situations Trust, The First Trust
Insured Corporate Trust, The First Trust of Insured Municipal Bonds, The
First Trust GNMA, Templeton Growth and Treasury Trust, Templeton Foreign
Fund & U.S. Treasury Securities Trust and The Advantage Growth and
Treasury Securities Trust. First Trust introduced the first insured unit
investment trust in 1974 and to date more than $9 billion in First Trust
unit investment trusts have been deposited. The Sponsor's employees
include a team of professionals with many years of experience in the
unit investment trust industry. The Sponsor is a member of the National
Association of Securities Dealers, Inc. and Securities Investor
Protection Corporation and has its principal offices at 1001 Warrenville
Road, Lisle, Illinois 60532; telephone number (630) 241-4141. As of
December 31, 1996 the total partners' capital of Nike Securities L.P.
was $9,005,203 (audited). (This paragraph relates only to the Sponsor
and not to the Trust or to any series thereof or to any other
Underwriter. The information is included herein only for the purpose of
informing investors as to the financial responsibility of the Sponsor
and its ability to carry out its contractual obligations. More detailed
financial information will be made available by the Sponsor upon request.)
Who is the Trustee?
The Trustee is The Chase Manhattan Bank, with its principal executive
office located at 270 Park Avenue, New York, New York 10017 and its unit
investment trust office at 4 New York Plaza, 6th floor, New York, New
York 10004-2413. Unit holders who have questions regarding the Trust may
call the Customer Service Help Line at 1-800-682-7520. The Trustee is
subject to supervision by the Superintendent of Banks of the State of
New York, the Federal Deposit Insurance Corporation and the Board of
Governors of the Federal Reserve System.
The Trustee, whose duties are ministerial in nature, has not
participated in the selection of the Securities. For information
relating to the responsibilities of the Trustee under the Indenture,
reference is made to the material set forth under "Rights of Unit
Holders."
The Trustee and any successor trustee may resign by executing an
instrument in writing and filing the same with the Sponsor and mailing a
copy of a notice of resignation to all Unit holders. Upon receipt of
such notice, the Sponsor is obligated to appoint a successor trustee
promptly. If the Trustee becomes incapable of acting or becomes bankrupt
or its affairs are taken over by public authorities, the Sponsor may
remove the Trustee and appoint a successor as provided in the Indenture.
If upon resignation of a trustee no successor has accepted the
appointment within 30 days after notification, the retiring trustee may
apply to a court of competent jurisdiction for the appointment of a
successor. The resignation or removal of a trustee becomes effective
only when the successor trustee accepts its appointment as such or when
a court of competent jurisdiction appoints a successor trustee.
Any corporation into which a Trustee may be merged or with which it may
be consolidated, or any corporation resulting from any merger or
consolidation to which a Trustee shall be a party, shall be the
successor Trustee. The Trustee must be a banking corporation organized
under the laws of the United States or any State and having at all times
an aggregate capital, surplus and undivided profits of not less than
$5,000,000.
Page 24
Limitations on Liabilities of Sponsor and Trustee
The Sponsor and the Trustee shall be under no liability to Unit holders
for taking any action or for refraining from taking any action in good
faith pursuant to the Indenture, or for errors in judgment, but shall be
liable only for their own willful misfeasance, bad faith, gross
negligence (ordinary negligence in the case of the Trustee) or reckless
disregard of their obligations and duties. The Trustee shall not be
liable for depreciation or loss incurred by reason of the sale by the
Trustee of any of the Securities. In the event of the failure of the
Sponsor to act under the Indenture, the Trustee may act thereunder and
shall not be liable for any action taken by it in good faith under the
Indenture.
The Trustee shall not be liable for any taxes or other governmental
charges imposed upon or in respect of the Securities or upon the
interest thereon or upon it as Trustee under the Indenture or upon or in
respect of the Trust which the Trustee may be required to pay under any
present or future law of the United States of America or of any other
taxing authority having jurisdiction. In addition, the Indenture
contains other customary provisions limiting the liability of the Trustee.
If the Sponsor shall fail to perform any of its duties under the
Indenture or becomes incapable of acting or becomes bankrupt or its
affairs are taken over by public authorities, then the Trustee may (a)
appoint a successor Sponsor at rates of compensation deemed by the
Trustee to be reasonable and not exceeding amounts prescribed by the
Securities and Exchange Commission, or (b) terminate the Indenture and
liquidate the Trusts as provided herein, or (c) continue to act as
Trustee without terminating the Indenture.
Who is the Evaluator?
The Evaluator is First Trust Advisors L.P., an Illinois limited
partnership formed in 1991 and an affiliate of the Sponsor. The
Evaluator's address is 1001 Warrenville Road, Lisle, Illinois 60532. The
Evaluator may resign or may be removed by the Sponsor and the Trustee,
in which event the Sponsor and the Trustee are to use their best efforts
to appoint a satisfactory successor. Such resignation or removal shall
become effective upon the acceptance of appointment by the successor
Evaluator. If upon resignation of the Evaluator no successor has
accepted appointment within 30 days after notice of resignation, the
Evaluator may apply to a court of competent jurisdiction for the
appointment of a successor.
The Trustee, Sponsor and Unit holders may rely on any evaluation
furnished by the Evaluator and shall have no responsibility for the
accuracy thereof. Determinations by the Evaluator under the Indenture
shall be made in good faith upon the basis of the best information
available to it, provided, however, that the Evaluator shall be under no
liability to the Trustee, Sponsor or Unit holders for errors in
judgment. This provision shall not protect the Evaluator in any case of
willful misfeasance, bad faith, gross negligence or reckless disregard
of its obligations and duties.
OTHER INFORMATION
How May the Indenture be Amended or Terminated?
The Sponsor and the Trustee have the power to amend the Indenture
without the consent of any of the Unit holders when such an amendment is
(1) to cure any ambiguity or to correct or supplement any provision of
the Indenture which may be defective or inconsistent with any other
provision contained therein, or (2) to make such other provisions as
shall not adversely affect the interest of the Unit holders (as
determined in good faith by the Sponsor and the Trustee).
The Indenture provides that the Trust shall terminate upon the maturity,
redemption or other disposition of the last of the Treasury Obligations
held in such Trust, but in no event beyond the Mandatory Termination
Date indicated herein under "Summary of Essential Information." The
Trust may be liquidated at any time by consent of 100% of the Unit
holders of the Trust, or by the Trustee in the event that Units of the
Trust not yet sold aggregating more than 60% of the Units of the Trust
are tendered for redemption by the Underwriter, including the Sponsor.
In the event of termination, written notice thereof will be sent by the
Trustee to all Unit holders of the Trust. Within a reasonable period
after termination, the Trustee will follow the procedures set forth
under "How are Income and Capital Distributed?"
Commencing on the Treasury Obligations Maturity Date, Equity 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 Equity Securities. Written notice of any termination of the Trust
specifying the time or times at which Unit holders may surrender their
certificates for cancellation shall be given by the Trustee to each Unit
Page 25
holder at his address appearing on the registration books of the Trust
maintained by the Trustee. At least 60 days prior to the Treasury
Obligations Maturity Date, the Trustee will provide written notice
thereof to all Unit holders and will include with such notice a form to
enable Unit holders to elect a distribution of shares of Equity
Securities (reduced by customary transfer and registration charges), if
such Unit holder owns at least 2,500 Units of the Trust, rather than to
receive payment in cash for such Unit holder's pro rata share of the
amounts realized upon the disposition by the Trustee of Equity
Securities. All Unit holders of the Trust will receive their pro rata
portion of the Treasury Obligations in cash upon the termination of the
Trust. To be effective, the election form, together with surrendered
certificates and other documentation required by the Trustee, must be
returned to the Trustee at least five business days prior to the
Treasury Obligations Maturity Date. Unit holders not electing a
distribution of shares of Equity Securities 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 the
Trust any accrued costs, expenses, advances or indemnities provided by
the Trust Agreement, 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. Any
sale of Securities in the Trust upon termination may result in a lower
amount than might otherwise be realized if such sale were not required
at such time. The Trustee will then distribute to each Unit holder his
pro rata share of the balance of the Income and Capital Accounts.
Legal Opinions
The legality of the Units offered hereby and certain matters relating to
Federal tax law have been passed upon by Chapman and Cutler, 111 West
Monroe Street, Chicago, Illinois 60603, as counsel for the Sponsor.
Carter, Ledyard & Milburn, will act as counsel for the Trustee and as
special New York tax counsel for the Trust.
Experts
The statement of net assets, including the schedule of investments, of
the Trust at the opening of business on the Initial Date of Deposit
appearing in this Prospectus and Registration Statement has been audited
by Ernst & Young LLP, independent auditors, as set forth in their report
thereon appearing elsewhere herein and in the Registration Statement,
and is included in reliance upon such report given upon the authority of
such firm as experts in accounting and auditing.
UNDERWRITING
The Underwriter named below has purchased Units in the following amount:
<TABLE>
<CAPTION>
Number
Name Address of Units
____ _______ ________
<S> <C> <C>
UNDERWRITER
The Ohio Company 155 East Broad Street
Columbus, OH 43215 15,000
=======
</TABLE>
On the Initial Date of Deposit, the Underwriter of the Trust became the
owner of the Units of the Trust and entitled to the benefits thereof, as
well as the risks inherent therein.
The Underwriter Agreement provides that a public offering of the Units
of the Trust will be made at the Public Offering Price described in the
Prospectus.
The Underwriter has agreed to underwrite additional Units of the Trust
as they become available. The Underwriter will receive the amount set
forth under "What are the Sponsor's and Underwriter's Profits?"
The Sponsor may from time to time in its advertising and sales materials
compare the then current estimated returns on the Trust and returns over
specified periods on other similar Trusts sponsored by Nike Securities
L.P. with returns on other taxable investments such as corporate or U.S.
Government bonds, bank CDs and money market accounts or money market
funds, each of which has investment characteristics that may differ from
those of the Trust. U.S. Government bonds, for example, are backed by
the full faith and credit of the U.S. Government and bank CDs and money
market accounts are insured by an agency of the federal government.
Money market accounts and money market funds provide stability of
Page 26
principal, but pay interest at rates that vary with the condition of the
short-term debt market. The investment characteristics of each Trust are
described more fully elsewhere in this Prospectus.
The Trust's performance may be compared to performance on a total return
basis of the Dow Jones Industrial Average, the S&P 500 Composite Price
Stock Index, or performance data from Lipper Analytical Services, Inc.
and Morningstar Publications, Inc. or from publications such as Money,
The New York Times, U.S. News and World Report, Business Week, Forbes or
Fortune. As with other performance data, performance comparisons should
not be considered representative of the Trust's relative performance for
any future period.
Page 27
REPORT OF INDEPENDENT AUDITORS
The Sponsor, Nike Securities L.P., and Unit Holders
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 215
We have audited the accompanying statement of net assets, including the
schedule of investments, of The First Trust Special Situations Trust,
Series 215, comprised of New Century Growth & Treasury Securities Trust,
as of the opening of business on August 27, 1997. This statement of net
assets is the responsibility of the Trust's Sponsor. Our responsibility
is to express an opinion on this statement of net assets based on our
audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the statement of net assets is
free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the statement
of net assets. Our procedures included confirmation of the letter of
credit held by the Trustee and deposited in the Trust on August 27,
1997. An audit also includes assessing the accounting principles used
and significant estimates made by the Sponsor, as well as evaluating the
overall presentation of the statement of net assets. We believe that our
audit of the statement of net assets provides a reasonable basis for our
opinion.
In our opinion, the statement of net assets referred to above presents
fairly, in all material respects, the financial position of The First
Trust Special Situations Trust, Series 215, comprised of New Century
Growth & Treasury Securities Trust, at the opening of business on August
27, 1997 in conformity with generally accepted accounting principles.
ERNST & YOUNG LLP
Chicago, Illinois
August 27, 1997
Page 28
Statement of Net Assets
NEW CENTURY GROWTH & TREASURY SECURITIES TRUST
The First Trust Special Situations Trust, Series 215
At the Opening of Business on the Initial Date of Deposit
August 27, 1997
<TABLE>
<CAPTION>
NET ASSETS
<S> <C>
Investment in Securities represented by purchase contracts (1) (2) $149,783
Organizational and offering costs (3) 10,000
________
159,783
Less accrued organizational and offering costs (3) (10,000)
________
Net assets $149,783
========
Units outstanding 15,000
</TABLE>
<TABLE>
<CAPTION>
ANALYSIS OF NET ASSETS
<S> <C>
Cost to investors, equal to net assets $149,783
========
</TABLE>
[FN]
NOTES TO STATEMENT OF NET ASSETS
(1) Aggregate cost of the Securities listed under "Schedule of
Investments" for New Century Growth & Treasury Securities Trust is based
on the offering side evaluations of the Treasury Obligations and the
aggregate underlying value of the Equity Securities.
(2) An irrevocable letter of credit totaling $200,000 issued by The Chase
Manhattan Bank has been deposited with the Trustee as collateral
covering the monies necessary for the purchase of the Securities in the
New Century Growth & Treasury Securities Trust pursuant to contracts for
the purchase of such Securities.
(3) The Trust will bear all or a portion of its estimated organizational
and offering costs which will be deferred and charged off over a period
not to exceed five years from the Initial Date of Deposit. The estimated
organizational and offering costs are based on 1,000,000 Units of the
Trust expected to be issued. To the extent the number of Units issued is
larger or smaller, the estimate will vary.
Page 29
Schedule of Investments
NEW CENTURY GROWTH & TREASURY SECURITIES TRUST
The First Trust Special Situations Trust, Series 215
At the Opening of Business on the Initial Date of Deposit
August 27, 1997
<TABLE>
<CAPTION>
Market Value
Percentage of per Share Cost of
Maturity Aggregate of Equity Securities
Value Name of Issuer and Title of Security (1) Offering Price Securities to Trust (2)
________ ________________________________________ ______________ ____________ ____________
<C> <S> <C> <C> <C>
$117,000 Zero coupon U.S. Treasury bonds
maturing November 15, 2004 49.47% $74,099
</TABLE>
<TABLE>
<CAPTION>
Number Ticker Symbol and
of Shares Name of Issuer of Equity Securities (1)
_________ ______________________________________
<C> <S> <C> <C> <C>
BASIC MATERIALS
23 DD E.I. du Pont de Nemours & Company 1.00% $ 65.188 1,499
31 MTC Monsanto Company .92% 44.188 1,370
CAPITAL GOODS
20 BA The Boeing Company .73% 54.438 1,089
17 CAT Caterpillar Inc. .67% 58.625 997
17 DE Deere & Company .64% 56.750 965
17 EMR Emerson Electric Co. .63% 55.750 948
23 GE General Electric Company .97% 63.438 1,459
23 HB Hillenbrand Industries Inc. .68% 44.563 1,025
12 TYC Tyco International Ltd. .62% 77.750 933
23 USF United States Filter Corporation .56% 36.188 832
COMMUNICATIONS
41 PGEX Pacific Gateway Exchange, Inc. 1.01% 36.875 1,512
44 WCOM Worldcom, Inc. .93% 31.750 1,397
CONSUMER CYCLICALS
35 CNS Consolidated Stores Corporation .85% 36.500 1,277
30 CTB Cooper Tire & Rubber Company .48% 24.000 720
17 KSS Kohl's Corporation .75% 66.000 1,122
18 NYT/A New York Times Company (Class A) .58% 47.813 861
26 NKE NIKE, Inc. (Class B) (3) .96% 55.188 1,435
23 SRV Service Corporation International .49% 31.938 735
CONSUMER STAPLES
23 KO The Coca-Cola Company .91% 59.063 1,358
23 DIS The Walt Disney Company 1.19% 77.500 1,782
15 G The Gillette Company .85% 85.000 1,275
72 IMAXF Imax Corporation (4) 1.15% 24.000 1,728
31 MCD McDonald's Corporation 1.00% 48.438 1,502
10 PG The Procter & Gamble Company .92% 137.188 1,372
ENERGY
16 AN Amoco Corporation 1.02% 95.125 1,522
17 XON Exxon Corporation .70% 61.875 1,052
15 MOB Mobil Corporation .74% 73.938 1,109
20 SLB Schlumberger, Ltd. 1.01% 75.375 1,507
19 RIG Transocean Offshore Inc. 1.13% 88.875 1,689
FINANCIAL
12 AIG American International Group, Inc. .79% 97.938 1,175
29 ONE Banc One Corporation 1.06% 54.875 1,591
27 BBI Barnett Banks, Inc. .94% 52.313 1,412
13 CCI Citicorp 1.15% 132.563 1,723
</TABLE>
Page 30
Schedule of Investments (cont'd.)
NEW CENTURY GROWTH & TREASURY SECURITIES TRUST
The First Trust Special Situations Trust, Series 215
At the Opening of Business on the Initial Date of Deposit
August 27, 1997
<TABLE>
<CAPTION>
Market Value
Percentage of per Share Cost of
Number Ticker Symbol and Aggregate of Equity Securities
of Shares Name of Issuer of Equity Securities (1) Offering Price Securities to Trust (2)
________ ________________________________ ______________ ____________ ____________
<C> <S> <C> <C> <C>
24 FITB Fifth Third Bancorp .95% $59.000 $ 1,416
54 HBAN Huntington Bancshares Incorporated 1.16% 32.250 1,742
26 NCC National City Corporation .99% 56.938 1,480
33 NFS Nationwide Financial Services, Inc. .61% 27.688 914
27 TROW T. Rowe Price Associates, Inc. .99% 55.000 1,485
HEALTHCARE
25 AMGN Amgen, Inc. .85% 50.875 1,272
47 BMET Biomet, Inc. .67% 21.438 1,008
24 CAH Cardinal Health, Inc. 1.03% 64.500 1,548
48 HRC HEALTHSOUTH Corporation .78% 24.438 1,173
22 JNJ Johnson & Johnson .84% 57.188 1,258
17 MDT Medtronic, Inc. 1.02% 90.063 1,531
15 MRK Merck & Company, Inc. .92% 91.625 1,374
26 PFE Pfizer, Inc. .93% 53.813 1,399
TECHNOLOGY
16 AMAT Applied Materials, Inc. 1.05% 98.375 1,574
40 AZPN Aspen Technologies, Inc. .92% 34.500 1,380
23 CSCO Cisco Systems, Inc. 1.19% 77.563 1,784
26 CPQ Compaq Computer Corporation 1.14% 65.563 1,705
17 CSC Computer Sciences Corporation .85% 74.625 1,269
21 INTC Intel Corporation 1.30% 92.688 1,946
15 LU Lucent Technologies .82% 82.250 1,234
14 MSFT Microsoft Corporation 1.26% 135.000 1,890
16 MOT Motorola, Inc. .83% 77.500 1,240
TRANSPORTATION
16 FDX Federal Express Corporation .72% 67.250 1,076
UTILITIES
22 WMB The Williams Companies, Inc. .68% 46.063 1,013
_______ ________
Total Equity Securities 50.53% 75,684
_______ ________
Total Investments 100% $149,783
======= ========
</TABLE>
[FN]
______________
(1) The Treasury Obligations were purchased at a discount from their par
value because there is no stated interest income thereon (such
securities are often referred to as zero coupon U.S. Treasury bonds).
Over the life of the Treasury Obligations the value increases, so that
upon maturity the holders will receive 100% of the principal amount
thereof. 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 Securities were entered into by the Sponsor on August 26, 1997.
(2) The cost of the Securities to the Trust represents the offering side
evaluation as determined by the Evaluator, an affiliate of the Sponsor,
with respect to the Treasury Obligations and the aggregate underlying
value with respect to the Equity Securities acquired (generally
determined by the closing sale prices of the listed Equity Securities
and the ask prices of the over-the-counter traded Equity Securities on
the business day preceding the Initial Date of Deposit). The offering
side evaluation of the Treasury Obligations is greater than the bid side
evaluation of such Treasury Obligations which is the basis on which the
Redemption Price per Unit will be determined after the initial offering
period. The aggregate value, based on the bid side evaluation of the
Treasury Obligations and the aggregate underlying value of the Equity
Securities on the Initial Date of Deposit, was $149,680. Cost and profit
to the Sponsor relating to the Treasury Obligations sold to the Trust
were $74,099 and $0, respectively. Cost and loss to Sponsor relating to
the Equity Securities sold to the Trust were $75,717 and $33,
respectively.
(3) NIKE, Inc. is not affiliated in any way with Nike Securities L.P.,
the Trust's Sponsor.
(4) Imax Corporation is a Canadian corporation which trades on The Nasdaq
Stock Market.
Page 31
CONTENTS:
Summary of Essential Information 4
The First Trust Special Situations Trust, Series 215:
What is The First Trust Special Situations Trust? 5
What are the Expenses and Charges? 6
What is the Federal Tax Status of Unit Holders? 7
Why are Investments in the Trusts Suitable for
Retirement Plans? 11
Portfolios:
What are Treasury Obligations? 11
What are Equity Securities? 11
Risk Factors 11
What are the Equity Securities Selected for
New Century Growth & Treasury Securities Trust? 13
What are Some Additional Considerations for
Investors? 17
Public Offering:
How is the Public Offering Price Determined? 18
How are Units Distributed? 19
What are the Sponsor's and Underwriter's Profits? 19
Rights of Unit Holders:
How is Evidence of Ownership Issued and
Transferred? 19
How are Income and Capital Distributed? 20
What Reports will Unit Holders Receive? 21
How May Units be Redeemed? 21
How May Units be Purchased by the Sponsor? 23
How May Securities be Removed from the Trust? 23
Information as to Underwriter, Sponsor, Trustee
and Evaluator:
Who is the Underwriter? 23
Who is the Sponsor? 24
Who is the Trustee? 24
Limitations on Liabilities of Sponsor and Trustee 25
Who is the Evaluator? 25
Other Information:
How May the Indenture be Amended or Terminated? 25
Legal Opinions 26
Experts 26
Underwriting 26
Report of Independent Auditors 28
Statement of Net Assets 29
Notes to Statement of Net Assets 29
Schedule of Investments 30
______________
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS NOT LAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO, WHICH THE FUND
HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940,
AND TO WHICH REFERENCE IS HEREBY MADE.
The Ohio Company
NEW CENTURY GROWTH & TREASURY SECURITIES TRUST
The Ohio Company
155 East Broad Street
Columbus, Ohio 43215
1-800-255-1825
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
PLEASE RETAIN THIS PROSPECTUS
FOR FUTURE REFERENCE
August 27, 1997
Page 32
CONTENTS OF REGISTRATION STATEMENT
A. BONDING ARRANGEMENTS OF DEPOSITOR:
Nike Securities L.P. is covered by a Brokers' Fidelity Bond,
in the total amount of $1,000,000, the insurer being
National Union Fire Insurance Company of Pittsburgh.
B. THIS REGISTRATION STATEMENT ON FORM S-6 COMPRISES
THE FOLLOWING PAPERS AND DOCUMENTS:
The facing sheet
The Cross-Reference Sheet
The Prospectus
The signatures
Exhibits
Financial Data Schedule
S-1
SIGNATURES
The Registrant, The First Trust Special Situations Trust,
Series 215, hereby identifies The First Trust Special Situations
Trust, Series 4 Great Lakes Growth and Treasury Trust, Series 1;
The First Trust Special Situations Trust, Series 18 Wisconsin
Growth and Treasury Securities Trust, Series 1; The First Trust
Combined Series 248; The First Trust Special Situations Trust,
Series 69 Target Equity Trust Value Ten Series; The First Trust
Special Situations Trust, Series 108; The First Trust Special
Situations Trust, Series 119 Target 5 Trust, Series 2 and Target
10 Trust, Series 8; and The First Trust Special Situations Trust,
Series 190 Biotechnology Growth Trust, Series 3 for purposes of
the representations required by Rule 487 and represents the
following:
(1) that the portfolio securities deposited in the series
as to the securities of which this Registration Statement is
being filed do not differ materially in type or quality from
those deposited in such previous series;
(2) that, except to the extent necessary to identify the
specific portfolio securities deposited in, and to provide
essential financial information for, the series with respect to
the securities of which this Registration Statement is being
filed, this Registration Statement does not contain disclosures
that differ in any material respect from those contained in the
registration statements for such previous series as to which the
effective date was determined by the Commission or the staff; and
(3) that it has complied with Rule 460 under the Securities
Act of 1933.
Pursuant to the requirements of the Securities Act of 1933,
the Registrant, The First Trust Special Situations Trust, Series
215, has duly caused this Amendment to Registration Statement to
be signed on its behalf by the undersigned, thereunto duly
authorized, in the Village of Lisle and State of Illinois on
August 27, 1997.
THE FIRST TRUST SPECIAL SITUATIONS
TRUST, SERIES 215
By NIKE SECURITIES L.P.
Depositor
By Robert M. Porcellino
Senior Vice President
S-2
Pursuant to the requirements of the Securities Act of 1933,
this Amendment to the Registration Statement has been signed
below by the following person in the capacity and on the date
indicated:
NAME TITLE* DATE
Robert D. Van Kampen Sole Director )
of Nike Securities )
Corporation, the ) August 27, 1997
General Partner of )
Nike Securities L.P.)
)
)
) Robert M. Porcellino
) Attorney-in-Fact**
)
)
* The title of the person named herein represents his
capacity in and relationship to Nike Securities L.P.,
Depositor.
** An executed copy of the related power of attorney was
filed with the Securities and Exchange Commission in
connection with the Amendment No. 1 to Form S-6 of The
First Trust Combined Series 258 (File No. 33-63483) and
the same is hereby incorporated herein by this reference.
S-3
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption
"Experts" and to the use of our report dated August 27, 1997 in
Amendment No. 1 to the Registration Statement (Form S-6) (File No.
333-34343) and related Prospectus of The First Trust
Special Situations Trust, Series 215.
ERNST & YOUNG LLP
Chicago, Illinois
August 27, 1997
CONSENTS OF COUNSEL
The consents of counsel to the use of their names in the
Prospectus included in this Registration Statement will be
contained in their respective opinions to be filed as Exhibits
3.1, 3.2, 3.3 and 3.4 of the Registration Statement.
CONSENT OF FIRST TRUST ADVISORS L.P.
The consent of First Trust Advisors L.P. to the use of its
name in the Prospectus included in the Registration Statement
will be filed as Exhibit 4.1 to the Registration Statement.
S-4
EXHIBIT INDEX
1.1 Form of Standard Terms and Conditions of Trust for The
First Trust Special Situations Trust, Series 18 and
subsequent Series effective October 15, 1991 among Nike
Securities L.P., as Depositor, United States Trust
Company of New York as Trustee, Securities Evaluation
Service, Inc., as Evaluator, and Nike Financial Advisory
Services L.P. as Portfolio Supervisor (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
42683] filed on behalf of The First Trust Special
Situations Trust, Series 18).
1.1.1 Form of Trust Agreement for Series 215 among Nike
Securities L.P., as Depositor, The Chase Manhattan Bank,
as Trustee, First Trust Advisors L.P., as Evaluator, and
First Trust Advisors L.P., as Portfolio Supervisor.
1.2 Copy of Certificate of Limited Partnership of Nike
Securities L.P. (incorporated by reference to Amendment
No. 1 to Form S-6 [File No. 33-42683] filed on behalf of
The First Trust Special Situations Trust, Series 18).
1.3 Copy of Amended and Restated Limited Partnership
Agreement of Nike Securities L.P. (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
42683] filed on behalf of The First Trust Special
Situations Trust, Series 18).
1.4 Copy of Articles of Incorporation of Nike Securities
Corporation, the general partner of Nike Securities
L.P., Depositor (incorporated by reference to Amendment
No. 1 to Form S-6 [File No. 33-42683] filed on behalf of
The First Trust Special Situations Trust, Series 18).
1.5 Copy of By-Laws of Nike Securities Corporation, the
general partner of Nike Securities L.P., Depositor
(incorporated by reference to Amendment No. 1 to Form S-
6 [File No. 33-42683] filed on behalf of The First Trust
Special Situations Trust, Series 18).
1.6 Underwriter Agreement (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-42755] filed on
behalf of The First Trust Special Situations Trust,
Series 19).
2.1 Copy of Certificate of Ownership (included in Exhibit
1.1 filed herewith on page 2 and incorporated herein by
reference).
S-5
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.
4.1 Consent of First Trust Advisors L.P.
6.1 List of Directors and Officers of Depositor and other
related information (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-42683] filed on
behalf of The First Trust Special Situations Trust,
Series 18).
7.1 Power of Attorney executed by the Director listed on
page S-3 of this Registration Statement (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
63483] filed on behalf of The First Trust Combined
Series 258).
S-6
THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 215
TRUST AGREEMENT
Dated: August 27, 1997
This Trust Agreement among Nike Securities L.P., as
Depositor, The Chase Manhattan Bank, as Trustee, First Trust
Advisors L.P., as Evaluator and First Trust Advisors L.P., as
Portfolio Supervisor, sets forth certain provisions in full and
incorporates other provisions by reference to the document
entitled "Standard Terms and Conditions of Trust for The First
Trust Special Situations Trust, Series 18 and subsequent Series,
Effective October 15, 1991" (herein called the "Standard Terms
and Conditions of Trust"), 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 premises and of the mutual
agreements herein contained, the Depositor, the Trustee, the
Evaluator and the Portfolio Supervisor agree as follows:
PART I
STANDARD TERMS AND CONDITIONS OF TRUST
Subject to the provisions of Part II and Part III 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 tough 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 initially deposited in the Trust
pursuant to Section 2.01 of the Standard Terms and Conditions of
Trust are set forth in the Schedules hereto.
B. (1) The aggregate number of Units outstanding for the
Trust on the Initial Date of Deposit is 15,000 Units.
(2) The initial fractional undivided interest in and
ownership of the Trust represented by each Unit thereof shall be
1/15,000.
Documents representing this number of Units for the Trust
are being delivered by the Trustee to the Depositor pursuant to
Section 2.03 of the Standard Terms and Conditions of Trust.
C. The Percentage Ratio is as follows on the Initial Date
of Deposit:
49.47% Zero coupon U.S. Treasury bonds maturing November 15,
2004, 1.00% E.I. du Pont de Nemours & Company, .92% Monsanto
Company, .73% The Boeing Company, .67% Caterpillar Inc.,
.64% Deere & Company, .63% Emerson Electric Co., .97%
General Electric Company, .68% Hillenbrand Industries Inc.,
.62% Tyco International Ltd., .56% United States Filter
Corporation, 1.01% Pacific Gateway Exchange, Inc., .93%
Worldcom, Inc., .85% Consolidated Stores Corporation, .48%
Cooper Tire & Rubber Company, .75% Kohl's Corporation, .58%
New York Times Company (Class A), .96% NIKE, Inc. (Class B),
.49% Service Corporation International, .91% The Coca-Cola
Company, 1.19% The Walt Disney Company, .85% The Gillette
Company, 1.15% Imax Corporation, 1.00% McDonald's
Corporation, .92% The Procter & Gamble Company, 1.02% Amoco
Corporation, .70% Exxon Corporation, .74% Mobil Corporation,
1.01% Schlumberger, Ltd., 1.13% Transocean Offshore Inc.,
.79% American International Group, Inc., 1.06% Banc One
Corporation, .94% Barnett Banks, Inc., 1.15% Citicorp, .95%
Fifth Third Bancorp, 1.16% Huntington Bancshares
Incorporated, .99% National City Corporation, .61%
Nationwide Financial Service, Inc., .99% T. Rowe Price
Associates, Inc., .85% Amgen, Inc., .67% Biomet, Inc., 1.03%
Cardinal Health, Inc., .78% HEALTHSOUTH Corporation, .84%
Johnson & Johnson, 1.02% Medtronic, Inc., .92% Merck &
Company, Inc., .93% Pfizer, Inc., 1.05% Applied Materials,
Inc., .92% Aspen Technologies, Inc., 1.19% Cisco Systems,
Inc., 1.14% Compaq Computer Corporation, .85% Computer
Sciences Corporation, 1.30% Intel Corporation, .82% Lucent
Technologies, 1.26% Microsoft Corporation, .83% Motorola,
Inc., .72% Federal Express Corporation, .68% The Williams
Companies, Inc.
D. The Record Dates shall be as set forth in the
Prospectus under "Summary of Essential Information."
E. The Distribution Dates shall be as set forth in the
Prospectus under "Summary of Essential Information."
F. The Mandatory Termination Date for the Trust shall be
November 15, 2004.
G. The Treasury Obligations Maturity Date for the Trust
shall be November 15, 2004.
H. The Evaluator's compensation as referred to in Section
4.03 of the Standard Terms and Conditions of Trust shall be an
annual fee of $.0025 per Unit calculated on the largest number of
Units outstanding during each period in respect of which a
payment is made pursuant to Section 3.05, payable on a
Distribution Date. Such fee may exceed the actual cost of
providing such evaluation services for the Trust, but at no time
will the total amount received for evaluation services rendered
to unit investment trusts of which Nike Securities L.P. is the
sponsor in any calendar year exceed the aggregate cost to the
Evaluator of supplying such services in such year.
I. The Trustee's Compensation Rate pursuant to Section
6.04 of the Standard Terms and Conditions of Trust shall be an
annual fee of $.0075 per Unit, calculated on the largest number
of Units outstanding during each period in respect of which a
payment is made pursuant to Section 3.05. However, in no event,
except as may be otherwise be provided in the Standard Terms and
Conditions of Trust, shall the Trustee receive compensation in
any one year from any Trust of less than $2,000 for such annual
compensation.
J. The Initial Date of Deposit for the Trust is August 27,
1997.
K. The minimum amount of Equity Securities to be sold by
the Trustee pursuant to Section 5.02 of the Indenture for the
redemption of Units shall be 100 shares.
PART III
A. Section 1.01(2) shall be amended to read as follows:
"(2) "Trustee" shall mean The Chase Manhattan Bank, or any
successor trustee appointed as hereinafter provided."
All references to United States Trust Company of New York in
the Standard Terms and Conditions of Trust shall be amended to
refer to The Chase Manhattan Bank.
B. The term "Capital Account" as set forth in the
Prospectus shall be deemed to refer to the "Principal Account."
C. Paragraph (b) of Section 2.01 shall be restated in its
entirety as follows:
(b)(1)From time to time following the Initial Date of
Deposit, the Depositor is hereby authorized, in its
discretion, to assign, convey to and deposit with the
Trustee (i) additional Securities, duly endorsed in blank or
accompanied by all necessary instruments of assignment and
transfer in proper form, (ii) Contract Obligations relating
to such additional Securities, accompanied by cash and/or
Letter(s) of Credit as specified in paragraph (c) of this
Section 2.01, or (iii) cash (or a Letter of Credit in lieu
of cash) with instructions to purchase additional
Securities, in an amount equal to the portion of the Unit
Value of the Units created by such deposit attributable to
the Securities to be purchased pursuant to such
instructions. 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 maintain, as nearly as
practicable, the Percentage Ratio. Each such deposit of
additional Securities shall be made pursuant to a Notice of
Deposit of Additional Securities delivered by the Depositor
to the Trustee. Instructions to purchase additional
Securities shall be in writing, and shall specify the name
of the Security, CUSIP number, if any, aggregate amount,
price or price range and date to be purchased. When
requested by the Trustee, the Depositor shall act as broker
to execute 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 Obligations
therefor) may, at the Depositor's discretion, be deposited
or purchased in round lots. If the amount of the deposit is
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 Obligations if
such deposits occur with 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 a payment on a
Security which has occurred or will occur before the Trust
will be the holder of record of a Security, reduced by 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. 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".
D. The last sentence of the first paragraph of Section
5.02 of the Standard Terms and Conditions of Trust is amended by
substituting "4:00 p.m. Eastern time" for "12:00 p.m in the City
of New York."
E. The third sentence of the seventh paragraph of Section
5.02 of the Standard Terms and Conditions of Trust is amended by
deleting "a certification from the independent public accountants
to the effect described in the second paragraph of this Section
5.02" and in its place inserting "a certification from the
Depositor and Trustee to the effect described in the second
paragraph of this Section 5.02."
F. Paragraph (a) of subsection II of Section 3.05 of the
Standard Terms and Conditions of Trust is hereby amended to
substitute the following sentence for the first sentence of such
paragraph:
"On each Distribution Date, the Trustee shall
distribute to each Unit holder of record at the close of
business on the Record Date immediately preceding such
Distribution Date an amount per Unit equal to such Unit
holder's Income Distribution (as defined below), plus such
Unit holder's pro rata share of the balance of the Principal
Account (except for monies on deposit therein required to
purchase Contract Obligations) computed as of the close of
business on such Record Date after deduction of any amounts
provided in Subsection I, provided, however, that with
respect to distributions other than the distribution
occurring in the month of December of each year, the Trustee
shall not be required to make a distribution from the
Principal Account unless the amount available for
distribution shall equal $1.00 per 100 Units.
Each Trust shall provide the following distribution
elections: (1) distributions to be made by check mailed to
the post office address of the Unit holder as it appears on
the registration books of the Trustee, or (2) the following
reinvestment option:
The Trustee will, for any Unit holder who provides
the Trustee written instruction, properly executed and
in form satisfactory to the Trustee, received by the
Trustee no later than its close of business 10 business
days prior to a Record Date (the "Reinvestment Notice
Date"), reinvest such Unit holder's distribution from
the Income and 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 fifth
business day prior to the following Distribution Date,
and at such reduced sales charge as may be described in
the prospectus for the Trusts. If, for any reason, the
Depositor does not have Units of the Trust available
for purchase, the Trustee shall distribute such Unit
holder's distribution from the Income and Capital
Accounts in the manner provided in clause (1) of the
preceding paragraph. The Trustee shall be entitled to
rely on a written instruction received as of the
Reinvestment Notice Date and shall not be affected by
any subsequent notice to the contrary. The Trustee
shall have no responsibility for any 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.
Any Unit holder who does not effectively elect
reinvestment in Units of their respective Trust pursuant to
the preceding paragraph shall receive a cash distribution in
the manner provided in clause (1) of the second preceding
paragraph."
G. Section 3.12 of the Standard Terms and Conditions of
Trust is hereby deleted in its entirety and replaced with the
following language:
"Section 3.12. Notice to Depositor. 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 at least a legally required
number of holders of any Zero Coupon Obligation, if any,
(including but not limited to the making of any demand,
direction, request, giving of any notice, consent or waiver or
the voting with respect to any amendment or supplement to any
indenture, resolution, agreement or other instrument under or
pursuant to which the Zero Coupon Obligations, if any, have been
issued) 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 the event that the Trustee shall have been notified at
any time of any action to be taken or proposed to be taken by at
least a legally required number of holders of any Equity
Securities deposited in a Trust, the Trustee shall take such
action or omit from taking any action, as appropriate, so as to
insure that the Equity Securities are voted as closely as
possible in the same manner and the same general proportion as
are the Equity Securities held by owners other than the Trust.
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 exchange or
substitution be effected notwithstanding such rejection or
without an initial offer, any Securities, cash and/or property
received in exchange shall be deposited hereunder and 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 Depositor may
rely on the Portfolio Supervisor in so advising the Trustee. The
cash received in such exchange and cash proceeds of any such
sales shall be distributed to Unit holders on the next
distribution date in the manner set forth in Section 3.05
regarding distributions from the Principal Account. The Trustee
shall not be liable or responsible in any way for depreciation or
loss incurred by reason of any such sale.
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 3.12 other than failure to notify the
Depositor.
Whenever new securities or property is received and retained
by the Trust pursuant to this Section 3.12, the Trustee shall,
within 5 days thereafter, mail to all Unit holders of the Trust
notices of such acquisition unless legal counsel for the Trust
determines that such notice is not required by The Investment
Company Act of 1940, as amended."
H. Section 1.01(4) shall be amended to read as follows:
"(4)"Portfolio Supervisor" shall mean First Trust Advisors
L.P. and its successors in interest, or any successor portfolio
supervisor appointed as hereinafter provided."
I. Section 3.05 of Article III of the Standard Terms and
Conditions of Trust is hereby amended to include the following
subsection:
"Section 3.05.I.(e) 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 3.16."
J. Article III of the Standard Terms and Conditions of
Trust is hereby amended by inserting the following paragraphs
which shall be entitled Section 3.16.:
"Section 3.16. Bookkeeping and Administrative Expenses. As
compensation for providing bookkeeping and other administrative
services of a character described in Section 26(a)(2)(C) of the
Investment Company Act of 1940 to the extent such services are in
addition to, and do not duplicate, the services to be provided
hereunder by the Trustee or the Portfolio Supervisor, the
Depositor shall receive against a statement or statements
therefor submitted to the Trustee monthly or annually an
aggregate annual fee in an amount which shall not exceed that
dollar amount set forth in the Prospectus times the number of
Units outstanding as of January 1 of such year except for a year
or years in which an initial offering period as determined by
Section 4.01 of this Indenture occurs, in which case the fee for
a month is based on the number of Units outstanding at the end of
such month (such annual fee to be pro rated for any calendar year
in which the Depositor provides service during less than the
whole of such year), but in no event shall such compensation when
combined with all compensation received from other unit
investment trusts for which the Depositor hereunder is acting as
Depositor for providing such bookkeeping and administrative
services in any calendar year exceed the aggregate cost to the
Depositor providing services to such unit investment trusts.
Such compensation may, from time to time, be adjusted provided
that the total adjustment upward does not, at the time of such
adjustment, exceed the percentage of the total increase, after
the date hereof, in consumer prices for services as measured by
the United States Department of Labor Consumer Price Index
entitled "All Services Less Rent of Shelter" or similar index, if
such index should no longer be published. The consent or
concurrence of any Unit holder hereunder shall not be required
for any such adjustment or increase. Such compensation shall be
paid by the Trustee, upon receipt of invoice therefor from the
Depositor, upon which, as to the cost incurred by the Depositor
of providing services hereunder the Trustee may rely, and shall
be charged against the Income and Principal Accounts on or before
the Distribution Date following the Monthly Record Date on which
such period terminates. The Trustee shall have no liability to
any Certificateholder or other person for any payment made in
good faith pursuant to this Section.
If the cash balance in the Income and Principal Accounts
shall be insufficient to provide for amounts payable pursuant to
this Section 3.16, the Trustee shall have the power to sell (i)
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 3.16, provided, however, that Zero
Coupon Obligations may not be sold to pay for amounts payable
pursuant to this Section 3.16.
Any moneys payable to the Depositor pursuant to this Section
3.16 shall be secured by a prior lien on the Trust Fund except
that no such lien shall be prior to any lien in favor of the
Trustee under the provisions of Section 6.04 herein.
K. Section 1.01(3) shall be amended to read as follows:
"(3) "Evaluator" shall mean First Trust Advisors L.P. and
its successors in interest, or any successor evaluator appointed
as hereinafter provided."
L. The first sentence of Section 3.14. shall be amended to
read as follows:
"As compensation for providing supervisory portfolio
services under this Indenture, the Portfolio Supervisor
shall receive, in arrears, against a statement or statements
therefor submitted to the Trustee monthly or annually an
aggregate annual fee in an amount which shall not exceed the
amount set forth under "Summary of Essential Information-
Supervisory Fee" in the Prospectus times the number of Units
outstanding as of January 1 of such year except for a Trust
during the year or years in which an initial offering period
as determined in Section 4.01 of this Indenture occurs, in
which case the fee for a month is based on the number of
Units outstanding at the end of such month (such annual fee
to be pro rated for any calendar year in which the Portfolio
Supervisor provides services during less than the whole of
such year), but in no event shall such compensation when
combined with all compensation received from other series of
the Trust for providing such supervisory services in any
calendar year exceed the aggregate cost to the Portfolio
Supervisor for providing such services."
M. Section 3.01 of the Standard Terms and Conditions of
Trust shall be replaced in its entirety with the following:
"Section 3.01. Initial Cost. The expenses incurred in
establishing a Trust, including the cost of the preparation and
typesetting of the registration statement, prospectuses
(including preliminary prospectuses), 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 3.01, 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 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 6.04 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 (4) 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 3.01, the Trustee shall rely on the written estimates of
such expenses provided by the Depositor pursuant to Section
5.01."
N. Section 5.01 of the Standard Terms and Conditions of
Trust shall be amended as follows:
(i) The first sentence of the first paragraph of
Section 5.01 shall be amended by deleting the phrase
"together with all other assets of the Trust" at the end of
such sentence and adding the following at the conclusion
thereof: ", plus (4) amounts representing organizational
expenses paid from the Trust less amounts representing
accrued organizational expenses of the Trust, plus (5) all
other assets of the Trust."
(ii) The following shall be added at the end of the
first paragraph of Section 5.01:
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 3.01 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,
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.
O. For purposes of this Trust, Units of the Trust will not
be rated by Standard & Poor's Ratings Services and any reference
to such rating or any requirement that information be forwarded
to Standard & Poor's Ratings Services in the Standard Terms and
Conditions of Trust shall be inapplicable. In addition, any
reference to Unit holders receiving or the Trust maintaining a
specified amount per Unit upon the Mandatory Termination Date
shall be inapplicable.
P. For purposes of this Trust, any reference in the
Standard Terms and Conditions of Trust to "140%" shall be
replaced with "110%" in relation to the amount of cash or a
Letter of Credit needed to acquire Treasury Obligations.
Q. The second paragraph of Section 3.02 of the Standard
Terms and Conditions of Trust is hereby deleted and replaced with
the following sentence:
"Any non-cash distributions (other than a non-taxable
distribution of the shares of the distributing corporation
which shall be retained by the Trust) received by the Trust
shall be dealt with in the manner described at Section 3.12,
herein, and shall by retained or disposed of by the Trust
according to those provisions. The proceeds of any
disposition shall be credited to the Income Account of the
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."
R. Section 3.15 of the Standard Terms and Conditions of
Trust shall be deleted and any reference thereto shall be
inapplicable.
S. Notwithstanding anything to the contrary in Sections
3.14 and 4.05 of the Standard Terms and Conditions of Trust, so
long as Nike Securities L.P. is acting as Depositor, the Trustee
shall have no power to remove the Portfolio Supervisor.
T. Paragraph (c) of Subsection II of Section 3.05 of the
Standard Terms and Conditions of Trust is hereby amended to read
as follows:
"On each Distribution Date the Trustee shall distribute
to each Unit holder of record at the close of business on
the Record Date immediately preceding such Distribution Date
an amount per Unit equal to such Unit holder's pro rata
share of the balance of the Capital Account (except for
monies on deposit therein required to purchase Contract
Obligations) computed as of the close of business on such
Record Date after deduction of any amounts provided in
Subsection I."
U. The following shall be added immediately following the
first sentence of paragraph (c) of Section 2.01:
"The Trustee may allow the Depositor to substitute any
Letter(s) of Credit deposited with the Trustee in connection
with the deposits described in Section 2.01(a) and (b) with
cash in an amount sufficient to satisfy the obligations to
which the Letter(s) of Credit relates. Any substituted
Letter(s) of Credit shall be released by the Trustee."
V. Notwithstanding anything to the contrary in this
Standard Terms and Conditions of Trust, any reference to Unit
holders receiving or the Trust maintaining a specified amount per
Unit upon the Mandatory Termination Date shall be inapplicable.
In addition, nothing contained herein or in the Standard Terms
and Conditions of Trust which would (1) restrict the sale of any
Zero Coupon Obligation held by the Trust or (2) require the
maintenance of a per Unit maturity value upon the creation of
additional Units pursuant to a subsequent deposit as described in
Section 2.01(b) shall be applicable.
IN WITNESS WHEREOF, Nike Securities L.P., The Chase
Manhattan Bank and First Trust Advisors L.P. have each caused
this Trust Agreement to be executed and the respective corporate
seal to be hereto affixed and attested (if applicable) by
authorized officers; all as of the day, month and year first
above written.
NIKE SECURITIES L.P.,Depositor
By Robert M. Porcellino
Vice President
THE CHASE MANHATTAN BANK, Trustee
(SEAL) By Thomas Porrazzo
Vice President
Attest:
Rosalia A. Raviele
Second Vice President
FIRST TRUST ADVISORS L.P.,
Evaluator
By Robert M. Porcellino
Vice President
FIRST TRUST ADVISORS L.P.,
Portfolio Supervisor
By Robert M. Porcellino
Senior Vice President
SCHEDULE A TO TRUST AGREEMENT
Securities Initially Deposited
The First Trust Special Situations Trust, Series 215
(Note: Incorporated herein and made a part hereof for the
Trust is the "Schedule of Investments" for the Trust as set forth
in the Prospectus.)
CHAPMAN AND CUTLER
111 WEST MONROE STREET
CHICAGO, ILLINOIS 60603
August 27, 1997
Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
Re: The First Trust Special Situations Trust, Series 215
Gentlemen:
We have served as counsel for Nike Securities L.P., as
Sponsor and Depositor of The First Trust Special Situations
Trust, Series 215 in connection with the preparation, execution
and delivery of a Trust Agreement dated August 27, 1997 among
Nike Securities L.P., as Depositor, The Chase Manhattan Bank, as
Trustee, First Trust Advisors L.P., as Evaluator, and First Trust
Advisors L.P., as Portfolio Supervisor, pursuant to which the
Depositor has delivered to and deposited the Securities listed in
Schedule A to the Trust Agreement with the Trustee and pursuant
to which the Trustee has issued to or on the order of the
Depositor a certificate or certificates representing units of
fractional undivided interest in and ownership of the Fund
created under said Trust Agreement.
In connection therewith, we have examined such pertinent
records and documents and matters of law as we have deemed
necessary in order to enable us to express the opinions
hereinafter set forth.
Based upon the foregoing, we are of the opinion that:
1. the execution and delivery of the Trust Agreement and
the execution and issuance of certificates evidencing the Units
in the Fund have been duly authorized; and
2. the certificates evidencing the Units in the Fund when
duly executed and delivered by the Depositor and the Trustee in
accordance with the aforementioned Trust Agreement, will
constitute valid and binding obligations of the Fund and the
Depositor in accordance with the terms thereof.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement (File No. 333-34343)
relating to the Units referred to above, to the use of our name
and to the reference to our firm in said Registration Statement
and in the related Prospectus.
Respectfully submitted,
CHAPMAN AND CUTLER
EFF:erg
CHAPMAN AND CUTLER
111 WEST MONROE STREET
CHICAGO, ILLINOIS 60603
August 27, 1997
Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
The Chase Manhattan Bank
4 New York Plaza, 6th Floor
New York, New York 10004-2413
Re: The First Trust Special Situations Trust, Series 215
Gentlemen:
We have acted as counsel for Nike Securities L.P., Depositor
of The First Trust Special Situations Trust, Series 215 (the
"Fund"), in connection with the issuance of units of fractional
undivided interests in the Trust of said Fund (the "Trust"),
under a Trust Agreement, dated August 27, 1997 (the "Indenture"),
between Nike Securities L.P., as Depositor, The Chase Manhattan
Bank, as Trustee, First Trust Advisors L.P., as Evaluator and
First Trust Advisors L.P., as Portfolio Supervisor.
In this connection, we have examined the Registration
Statement, the form of Prospectus proposed to be filed with the
Securities and Exchange Commission, the Indenture and such other
instruments and documents 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 both Treasury Obligations and Equity Securities
(collectively, the "Securities") as such terms are defined in the
Prospectus.
Based upon the foregoing and upon an investigation of such
matters of law as we consider to be applicable, we are of the
opinion that, under existing federal income tax law:
I. The Trust is not an association taxable as a
corporation for Federal income tax purposes; each Unit
holder will be treated as the owner of a pro rata portion of
the assets of the Trust under the Internal Revenue Code of
1986 (the "Code"); the income of the Trust will be treated
as income of the Unit holders thereof under the Code; and an
item of Trust income will have the same character in the
hands of a Unit holder as it would have in the hands of each
Trustee. Each Unit holder will be considered to have
received his pro rata share of income derived from the Trust
asset when such income is received by the Trust.
II. Each Unit holder will have a taxable event when
the Trust disposes of a Security (whether by sale, exchange,
liquidation, redemption, or payment at maturity) or upon the
sale or redemption of Units by such Unit holder. The price
a Unit holder pays for his Units is allocated among his pro
rata portion of each Security held by the Trust (in
proportion to the fair market values thereof on the date the
Unit holder purchases his Units) in order to determine his
tax basis for his pro rata portion of each Security held by
the Trust. The Treasury Obligations are treated as bonds
that were originally issued at an original issue discount.
Because the Treasury Obligations represent interest in
"stripped" U.S. Treasury bonds, a Unit holder's initial cost
for his pro rata portion of each Treasury Obligation held by
the Trust (determined at the time he acquires his Units, in
the manner described above) shall be treated as its
"purchase price" by the Unit holder. Under the special
rules relating to stripped bonds, original issue discount is
effectively treated as interest for Federal income tax
purposes and the amount of original issue discount in this
case is generally the difference between the bond's purchase
price and its stated redemption price at maturity. A Unit
holder will be required to include in gross income for each
taxable year the sum of his daily portions of original issue
discount attributable to the Treasury Obligations held by
the Trust as such original issue discount accrues and will,
in general, be subject to Federal income tax with respect to
the total amount of such original issue discount that
accrues for such year even though the income is not
distributed to the Unit holders during such year to the
extent it is greater than or equal to a "de minimis" amount
determined under Treasury Regulations as described below.
To the extent the amount of such discount is less than the
respective "de minimis" amount, such discount shall be
treated as zero. In general, original issue discount
accrues daily under a constant interest rate method which
takes into account the semi-annual compounding of accrued
interest. In the case of the Treasury Obligations, this
method will generally result in an increasing amount of
income to the Unit holders each year. For Federal income
tax purposes, a Unit holder's pro rata portion of dividends
as defined by Section 316 of the Code paid by a corporation
with respect to an Equity Security held by the Trust is
taxable as ordinary income to the extent of such
corporation's current and accumulated "earnings and
profits." A Unit holder's pro rata portion of dividends
paid on such Equity Security which exceeds such current and
accumulated earnings and profits will first reduce a Unit
holder's tax basis in such Security, and to the extent that
such dividends exceed a Unit holder's tax basis in such
Security shall be treated as capital gain. In general, any
such capital gain will be short term unless a Unit holder
has held his units for more than one year.
III. A Unit holder's portion of gain, if any, upon the
sale or redemption of Units or the disposition of Securities
held by the Trust will generally be considered a capital
gain except in the case of a dealer or a financial
institution and will be generally long-term if the Unit
holder has held his Units for more than one year. A Unit
holder's portion of loss, if any, upon the sale or
redemption of Units or the disposition of Securities held by
a Trust will generally be considered a capital loss except
in the case of a dealer or a financial institution and will
be generally long-term if the Unit holder has held his Units
for more than one year.
IV. The Code provides that "miscellaneous itemized
deductions" are allowable only to the extent that they
exceed two percent of an individual taxpayer's adjusted
gross income. Miscellaneous itemized deductions subject to
this limitation under present law include a Unit holder's
pro rata share of expenses paid by a Trust, including fees
of the Trustee and the Evaluator.
The Code provides a complex set of rules governing the
accrual of original issue discount, including special rules
relating to "stripped" debt instruments such as the Treasury
Obligations. These rules provide that original issue discount
generally accrues on the basis of a constant compound interest
rate. Special rules apply if the purchase price of a Treasury
Obligation exceeds its original issue price plus the amount of
original issue discount which would have previously accrued,
based upon its issue price (its "adjusted issue price").
Similarly, these special rules would apply to a Unit holder if
the tax basis of his pro rata portion of a Treasury Obligation
issued with original issue discount exceeds his pro rata portion
of its adjusted issue price. The application of these rules will
also vary depending on the value of the Treasury Obligations on
the date a Unit holder acquires his Units, and the price a Unit
holder pays for his Units. In addition, as discussed above, the
Regulation provides that the amount of original issue discount on
a stripped bond is considered zero if the actual amount of
original issue discount on such stripped bond as determined under
Section 1286 of the Code is less than a "de minimis" amount,
which, the Regulation provides, is the product of (i) 0.25
percent of the stated redemption price at maturity and (ii) the
number of full years from the date the stripped bond is purchased
(determined separately for each new purchaser thereof) to the
final maturity date of the bond.
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. 333-34343)
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/jln
CARTER, LEDYARD & MILBURN
COUNSELLORS AT LAW
2 WALL STREET
NEW YORK, NEW YORK 10005
August 27, 1997
The Chase Manhattan Bank, as Trustee of
The First Trust Special Situations
Trust, Series 215
4 New York Plaza, 6th Floor
New York, New York 10004-2413
Attention: Mr. Paul J. Holland
Vice President
Re: The First Trust Special Situations Trust, Series 215
Dear Sirs:
We are acting as special counsel with respect to New York
tax matters for The First Trust Special Situations Trust, Series
215 (each, a "Trust"), which will be established under certain
Standard Terms and Conditions of Trust dated November 20, 1991,
and a related Trust Agreement dated as of today (collectively,
the "Indenture") among Nike Securities L.P., as Depositor (the
"Depositor"), First Trust Advisors L.P., as Evaluator, First
Trust Advisors L.P., as Portfolio Supervisor, and The Chase
Manhattan Bank, as Trustee (the "Trustee"). Pursuant to the
terms of the Indenture, units of fractional undivided interest in
the Trust (the "Units") will be issued in the aggregate number
set forth in the Indenture.
We have examined and are familiar with originals or
certified copies, or copies otherwise identified to our
satisfaction, of such documents as we have deemed necessary or
appropriate for the purpose of this opinion. In giving this
opinion, we have relied upon the two opinions, each dated today
and addressed to the Trustee, of Chapman and Cutler, counsel for
the Depositor, with respect to the matters of law set forth
therein.
Based upon the foregoing, we are of the opinion that:
1. The Trust will not constitute an association taxable as
a corporation under New York law, and accordingly will not be
subject to the New York State franchise tax or the New York City
general corporation tax.
2. Under the income tax laws of the State and City of New
York, the income of the Trust will be considered the income of
the holders of the Units.
We consent to the filing of this opinion as an exhibit to
the Registration Statement (No. 333-34343) filed with the
Securities and Exchange Commission with respect to the
registration of the sale of the Units and to the references to
our name under the captions "What is the Federal Tax Status of
Unit-holders?" and "Legal Opinions" in such Registration
Statement and the preliminary prospectus included therein.
Very truly yours,
CARTER, LEDYARD & MILBURN
CARTER, LEDYARD & MILBURN
COUNSELLORS AT LAW
2 WALL STREET
NEW YORK, NEW YORK 10005
August 27, 1997
The Chase Manhattan Bank, as Trustee of
The First Trust Special Situations
Trust, Series 215
4 New York Plaza, 6th Floor
New York, New York 10004-2413
Attention: Mr. Paul J. Holland
Vice President
Re: The First Trust Special Situations Trust, Series 215
Dear Sirs:
We are acting as counsel for The Chase Manhattan Bank
("Chase") in connection with the execution and delivery of a
Trust Agreement ("the Trust Agreement") dated today's date (which
Trust Agreement incorporates by reference certain Standard Terms
and Conditions of Trust dated November 20, 1991, and the same are
collectively referred to herein as the "Indenture") among Nike
Securities L.P., as Depositor (the "Depositor"), First Trust
Advisors L.P., as Evaluator; First Trust Advisors L.P., as
Portfolio Supervisor; and Chase, as Trustee (the "Trustee"),
establishing The First Trust Special Situations Trust, Series 215
(each, a "Trust"), and the confirmation by Chase, as Trustee
under the Indenture, that it has registered on the registration
books of the Trust the ownership by the Depositor of a number of
units constituting the entire interest in the Trust (such
aggregate units being herein called "Units"), each of which
represents an undivided interest in the respective Trust which
consists of common stocks and zero coupon United States Treasury
obligations (including confirmations of contracts for the purchase of
certain stocks not delivered and cash, cash equivalents or an
irrevocable letter of credit or a combination thereof, in the
amount required for such purchase upon the receipt of such
stocks), such stocks being defined in the Indenture as Securities
and referenced in the Schedule to the Indenture.
We have examined the Indenture, a specimen of the
certificates to be issued hereunder (the "Certificates"), the
Closing Memorandum dated today's date, and such other documents
as we have deemed necessary in order to render this opinion.
Based on the foregoing, we are of the opinion that:
1. Chase is a duly organized and existing corporation
having the powers of a Trust Company under the laws of the State
of New York.
2. The Trust Agreement has been duly executed and
delivered by Chase and, assuming due execution and delivery by
the other parties thereto, constitutes the valid and legally
binding obligation of Chase.
3. The Certificates are in proper form for execution and
delivery by Chase, as Trustee.
4. Chase, as Trustee, has registered on the registration
books of the Trust the ownership of the Units by the Depositor.
Upon receipt of confirmation of the effectiveness of the
registration statement for the sale of the Units filed with the
Securities and Exchange Commission under the Securities Act of
1933, the Trustee may deliver Certificates for such Units, in
such names and denominations as the Depositor may request, to or
upon the order of the Depositor as provided in the Closing
Memorandum.
5. Chase, as Trustee, may lawfully advance to the Trust
amounts as may be necessary to provide periodic interest
distributions of approximately equal amounts, and be reimbursed,
without interest, for any such advances from funds in the
interest account, as provided in the Indenture.
In rendering the foregoing opinion, we have not considered,
among other things, whether the Securities have been duly
authorized and delivered.
Very truly yours,
CARTER, LEDYARD & MILBURN
First Trust Advisors L.P.
1001 Warrenville Road
Lisle, Illinois 60532
August 27, 1997
Nike Securities L.P.
1001 Warrenville Road
Lisle, IL 60532
Re: THE FIRST TRUST SPECIAL SITUATIONS TRUST, SERIES 215
Gentlemen:
We have examined the Registration Statement File No.
333-34343 for the above captioned fund. We hereby consent to the
use in the Registration Statement of the references to First
Trust Advisors L.P. as evaluator.
You are hereby authorized to file a copy of this letter with
the Securities and Exchange Commission.
Sincerely,
First Trust Advisors L.P.
Robert M. Porcellino
Vice President
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND> This schedule contains summary financial information extracted
from Amendment number 1 to form S-6 and is qualified in its entirety by
reference to such Amendment number 1 to form S-6.
</LEGEND>
<SERIES>
<NUMBER> 1
<NAME> New Century Growth & Treasury
Securities Trust
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> Other
<FISCAL-YEAR-END> AUG-27-1997
<PERIOD-START> AUG-27-1997
<PERIOD-END> AUG-27-1997
<INVESTMENTS-AT-COST> 149,783
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</TABLE>
