Registration No. 333-63939
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:
FT 293
B. Name of depositor:
NIKE SECURITIES L.P.
C. Complete address of depositor's principal executive offices:
1001 Warrenville Road
Lisle, Illinois 60532
D. Name and complete address of agents for service:
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 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. 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 December 28, 1998 at 2:00 p.m. pursuant to Rule
487.
________________________________
DIVERSIFIED INCOME & GROWTH TRUST, 1999 WINTER SERIES
The Trust. FT 293 (the "Trust") is a unit investment trust consisting of
a fixed, diversified portfolio of common stocks with current dividend
yields on the Initial Date of Deposit of at least 70% of the dividend
yield on the Standard & Poor's 500 Composite Stock Price Index (the
"Equity Securities"). The portfolio was chosen because, in the opinion
of the Securities Research Department of A.G. Edwards & Sons, Inc., the
companies are likely to consistently raise annual dividends.
The Trust is designed to achieve two primary objectives: a higher stream
of income each year and risk reduction through diversification. See
"Schedule of Investments." The Trust has a mandatory termination date
(the "Mandatory Termination Date" or "Trust Ending Date") as set forth
under "Summary of Essential Information." There is, of course, no
guarantee that the objectives of the Trust will be achieved.
Each Unit of the Trust represents an undivided fractional interest in
all the Equity Securities deposited therein. 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. See "Portfolio."
The Sponsor may, from time to time during a period of up to
approximately 360 days after the Initial Date of Deposit, deposit
additional Equity Securities or cash (including a letter of credit) with
instructions to purchase additional Equity Securities in the Trust. Such
deposits of additional Equity Securities or cash will be done in such a
manner that the original proportionate relationship among the individual
issues of the Equity Securities shall be maintained. Any deposit by the
Sponsor of additional Equity Securities, or the purchase of additional
Equity Securities pursuant to a cash deposit, will duplicate, as nearly
as is practicable, the original proportionate relationship established
on the Initial Date of Deposit, 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 Equity Securities deposited in the Trust on the
Initial, or any subsequent, Date of Deposit. See "What is the FT
Series?" and "Rights of Unit Holders-How May Equity 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 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,
plus an initial sales charge equal to the difference between the maximum
sales charge of 3.3% of the Public Offering Price and the maximum
remaining deferred sales charge, initially $.23 per Unit, divided by the
number of Units of the Trust outstanding. Subsequent to the Initial Date
of Deposit, the amount of the initial sales charge will vary with
changes in the aggregate value of the Equity Securities. Commencing on
August 20, 1999, and on the twentieth day of each month thereafter (or
if such date is not a business day, on the preceding business day)
through December 20, 1999, a deferred sales charge of $.046 will be
assessed per Unit per month. Units purchased subsequent to the initial
deferred sales charge payment but still during the initial offering
period will be subject to the initial sales charge and the remaining
deferred sales charge
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
First Trust (registered trademark)
1-800-621-9533
The date of this Prospectus is December 28, 1998
Page 1
payments not yet collected. The deferred sales charge will be paid from
funds in the Capital Account, if sufficient, or from the periodic sale
of Equity Securities. The total maximum sales charge assessed to Unit
holders on a per Unit basis will be 3.3% of the Public Offering Price
(equivalent to 3.333% of the net amount invested, exclusive of the
deferred sales charge). A pro rata share of accumulated dividends, if
any, in the Income Account is included in the Public Offering Price. In
addition, a portion of the Public Offering Price on Units purchased
prior to the earlier of six months after the Initial Date of Deposit or
the end of the initial offering period also consists of Equity
Securities in an amount sufficient to pay for all or a portion of the
costs incurred in establishing the Trust. The organizational and
offering costs will be deducted from the assets of the Trust as of the
earlier of six months after the Initial Date of Deposit or the end of
the initial offering period. Upon completion of the deferred sales
charge period, the secondary market Public Offering Price per Unit for
the Trust will not include deferred payments, but will instead include
only a one-time initial sales charge of 3.3% of the Public Offering
Price (equivalent to 3.413% of the net amount invested), which will be
reduced to 2.8% of the Public Offering Price per Unit on January 3,
2000. The minimum amount which an investor may purchase of the Trust is
$1,000 ($500 for Individual Retirement Accounts, Roth Individual
Retirement Accounts, Education Individual Retirement Accounts or other
retirement plans). The sales charge is reduced on a graduated scale for
sales involving at least $50,000. See "Public Offering-How is the Public
Offering Price Determined?"
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.
Estimated Net Annual Distributions. The estimated net annual dividend
distribution to Unit holders (based on the most recent quarterly or semi-
annual ordinary dividend declared with respect to the Equity Securities
in the Trust) on the Initial Date of Deposit was $.2420 per Unit. The
actual net annual dividend distribution per Unit will vary with changes
in fees and expenses of the Trust, with changes in dividends received
and with the sale or liquidation of Equity Securities; therefore, there
is no assurance that the net annual dividend distribution will be
realized in the future.
Dividend and Capital Distributions. Distributions of dividends and
capital, if any, received by the Trust will be paid on the Income
Distribution Dates to Unit holders of record on the preceding Income
Distribution Record Dates 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. 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
subject only to remaining deferred sales charge payments, if any.
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?"
Secondary Market for Units. While under no obligation to do so, the
Sponsor intends to maintain a market for Units of the Trust and offer to
repurchase such Units at prices which are based on the aggregate
underlying value of the Equity Securities in the Trust (generally
determined by the closing sale prices of listed Equity Securities and
the bid prices of over-the-counter traded Equity Securities) plus or
minus cash, if any, in the Capital and Income Accounts of the Trust. If
a secondary market is maintained during the initial offering period, the
prices at which Units will be repurchased will also be based upon 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 Capital and Income
Accounts of the Trust. If a secondary market is not maintained, a Unit
holder may redeem Units through redemption at prices based upon the
aggregate underlying value of the Equity Securities in the Trust
(generally determined by the closing sale prices of listed Equity
Securities and either the ask prices (during the initial offering
period) or the bid prices (subsequent to the initial offering period) 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 Unit holder tendering 1,000 Units or more for redemption may request a
distribution of shares of Equity Securities (reduced by customary
transfer and registration charges) (an "In-Kind Distribution") in lieu
of payment in cash. Any deferred sales charge remaining on Units at the
Page 2
time of their sale or redemption will be collected at that time. See
"Rights of Unit Holders-How May Units be Redeemed?"
Termination. The Trust will terminate approximately three years after
the Initial Date of Deposit regardless of market conditions at that
time. Commencing no later than the Mandatory Termination Date, Equity
Securities will begin to be sold as prescribed by the Sponsor. The
Trustee will provide written notice of any termination of the Trust to
Unit holders which will specify when Unit holders may surrender their
certificates for cancellation and will include a form to enable Unit
holders to elect an In-Kind Distribution if such Unit holder owns at
least 1,000 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. 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 ten business days prior to the Mandatory Termination Date. Unit
holders not electing a distribution of shares of Equity Securities will
receive a cash distribution within a reasonable time after the Trust is
terminated. See "Rights of Unit Holders-How are Income and Capital
Distributed?" and "Other Information-How May the Indenture be Amended or
Terminated?"
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
the issuers of the Equity Securities or the general condition of the
stock market, volatile interest rates or economic recession. Volatility
in the market price of the Equity Securities in the Trust also changes
the value of the Units of the Trust. 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's portfolio is not managed and Equity Securities will not be sold
by the Trust regardless of market fluctuations, although some Equity
Securities may be sold under certain limited circumstances. See "What
are the Equity Securities Selected for the Diversified Income & Growth
Trust, 1999 Winter Series?-Risk Factors."
Page 3
Summary of Essential Information
At the Opening of Business on the Initial Date of Deposit
of the Equity Securities-December 28, 1998
Sponsor: Nike Securities L.P.
Trustee: The Chase Manhattan Bank
Evaluator: First Trust Advisors L.P.
<TABLE>
<CAPTION>
General Information
<S> <C>
Initial Number of Units (1) 14,996
Fractional Undivided Interest in the Trust per Unit (1) 1/14,996
Public Offering Price:
Aggregate Offering Price Evaluation of Equity Securities in Portfolio (2) $148,461
Aggregate Offering Price Evaluation of Equity Securities per Unit $ 9.900
Maximum Sales Charge of 3.3% of the Public Offering Price per Unit
(3.333% of the net amount invested, exclusive of the deferred sales charge) (3) $ .330
Less Deferred Sales Charge per Unit $ (.230)
Public Offering Price per Unit (3) $10.000
Sponsor's Initial Repurchase Price per Unit (4) $ 9.670
Redemption Price per Unit (based on aggregate underlying
value of Equity Securities) (4) $ 9.670
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
CUSIP Number 30264S 734
Security Code 56305
First Settlement Date December 31, 1998
Mandatory Termination Date January 1, 2002
Discretionary Liquidation Amount The Trust may be terminated if the value thereof is less than the
lower of $2,000,000 or 20% of the total value of Equity Securities
deposited in the Trust during the initial offering period.
Trustee's Annual Fee $.0096 per Unit outstanding.
Evaluator's Annual Fee $.0030 per Unit outstanding, payable to an affiliate of the Sponsor.
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.
Portfolio Supervisor's Annual Fee (5) $.0035 per Unit outstanding, payable to an affiliate of the Sponsor.
Estimated Organizational and Offering Costs (6) $.0200 per Unit.
Income Distribution Record Date Fifteenth day of each March, June, September and December commencing
March 15, 1999.
Income Distribution Date (7) Last day of each March, June, September and December commencing March
31, 1999.
____________
<FN>
(1) As of the close of business on the Initial Date of Deposit, the
number of Units of the Trust may be adjusted so that the Public Offering
Price per Unit will equal approximately $10.00. Therefore, to the extent
of any such adjustment, the fractional undivided interest per Unit will
increase or decrease accordingly, from the amounts indicated above.
(2) Each listed Equity Security 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.
(3) The maximum sales charge consists of an initial sales charge and a
deferred sales charge. See "Fee Table" and "Public Offering" for
additional information regarding these charges. 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) The Sponsor's Initial Repurchase Price per Unit and the Redemption
Price per Unit set forth above and until the earlier of six months after
the Initial Date of Deposit or the end of the initial offering period
include estimated organizational and offering costs per Unit. After such
date, the Sponsor's Repurchase Price and Redemption Price per Unit will
not include such estimated organizational and offering costs. See
"Rights of Unit Holders-How May Units be Redeemed?"
(5) In addition, the Sponsor will be reimbursed for bookkeeping and
other administrative expenses currently at a maximum annual rate of
$.0033 per Unit.
(6) Investors will bear all or a portion of the costs incurred in
organizing 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, legal fees 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). Estimated
organizational and offering costs are included in the Public Offering
Price per Unit and will be deducted from the assets of the Trust at the
earlier of six months after the Initial Date of Deposit or the end of
the initial offering period. See "Public Offering" and "Statement of Net
Assets."
(7) Distributions from the Capital Account will be made monthly payable
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 $0.01 per Unit. Notwithstanding, distributions of funds in the
Capital Account, if any, will be made in December of each year.
</FN>
</TABLE>
Page 4
FEE TABLE
This Fee Table is intended to help you to understand the costs and
expenses that you will bear directly or indirectly. See "Public
Offering" and "What are the Expenses and Charges?" Although the Trust
has a term of approximately three years and is a unit investment trust
rather than a mutual fund, this information is presented to permit a
comparison of fees.
<TABLE>
<CAPTION>
Amount
per Unit
________
<S> <C> <C>
Unit Holder Transaction Expenses
Initial sales charge imposed on purchase
(as a percentage of public offering price) 1.00%(a) $ .100
Deferred sales charge
(as a percentage of public offering price) 2.30%(b) .230
________ ________
3.30% $ .330
======== ========
Maximum Sales Charge Imposed on Reinvested Dividends 2.30%(c) $ .230
Organizational and Offering Costs
Estimated Organizational and Offering Costs
(as a percentage of public offering price) .200%(d) $.0200
======== ========
Estimated Annual Trust Operating Expenses
(as a percentage of average net assets)
Trustee's fee .097% $.0096
Portfolio supervision, bookkeeping, administrative and evaluation fees .099% .0098
Other operating expenses .054% .0054
________ ________
Total .250% $.0248
======== ========
</TABLE>
<TABLE>
<CAPTION>
Example
_______
Cumulative Expenses
Paid for Period:
1 Year 3 Years
______ _______
<S> <C> <C>
An investor would pay the following expenses on a $1,000 investment, assuming the
Diversified Income & Growth Trust, 1999 Winter Series has an estimated operating
expense ratio of .250% and a 5% annual return on the investment throughout the periods $ 38 $ 43
The example assumes reinvestment of all dividends and distributions and
utilizes a 5% annual rate of return as mandated by Securities and
Exchange Commission regulations applicable to mutual funds. For purposes
of the example, the deferred sales charge imposed on reinvestment of
dividends is not reflected until the year following payment of the
dividend; the cumulative expenses would be higher if sales charges on
reinvested dividends were reflected in the year of reinvestment. The
example should not be considered a representation of past or future
expenses or annual rate of return; the actual expenses and annual rate
of return may be more or less than those assumed for purposes of the
example.
_____________
<FN>
(a) The initial sales charge is actually the difference between the
maximum total sales charge of 3.3% and the maximum remaining deferred
sales charge (initially $.23 per Unit) and would exceed 1.00% if the
Public Offering Price exceeds $10.00 per Unit.
(b) The actual fee is $.046 per Unit per month, irrespective of purchase
or redemption price deducted monthly commencing August 20, 1999 through
December 20, 1999. If a Unit holder sells or redeems Units before all of
these deductions have been made, the balance of the deferred sales
charge payments remaining will be deducted from the sales or redemption
proceeds. If the Unit price is less than $10.00 per Unit, the deferred
sales charge will exceed 2.3%. Units purchased subsequent to initial
deferred sales charge payment will be subject to the initial sales
charge and the remaining deferred sales charge payments not yet collected.
(c) Reinvested Dividends will be subject only to the deferred sales
charge remaining at the time of reinvestment. See "Rights of Unit
Holders-How are Income and Capital Distributed?"
(d) Investors will bear all or a portion of the costs incurred in
organizing 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 the states, the
initial audit of the Trust portfolio, legal fees and the initial fees
and expenses of the Trustee) as is common for mutual funds. Estimated
organizational and offering costs are included in the Public Offering
Price per Unit and will be deducted from the assets of the Trust at the
earlier of six months after the Initial Date of Deposit or the end of
the initial offering period.
</FN>
</TABLE>
Page 5
DIVERSIFIED INCOME & GROWTH TRUST
1999 WINTER SERIES
FT 293
What is the FT Series?
FT 293 is one of a series of investment companies created by the
Sponsor, all of which are generally similar but each of which is
separate and is designated by a different series number. The FT Series
was formerly known as The First Trust Special Situations Trust Series.
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 the Equity Securities,
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
Equity Securities. In exchange for the deposit of Equity Securities or
contracts to purchase Equity Securities in the Trust, the Trustee
delivered to the Sponsor documents evidencing the entire ownership of
the Trust.
The Trust is a unit investment trust with a portfolio containing stocks
with current dividend yields as of the Initial Date of Deposit of at
least 70% of the dividend yield on the Standard & Poor's 500 Composite
Stock Price Index (the "S&P 500 Index"), chosen because of the
companies' likelihood to consistently raise annual dividends. A.G.
Edwards & Sons, Inc. Securities Research Department, along with the
Sponsor, scrutinized the dividend security and long-term growth
potential of hundreds of companies. The list of Equity Securities in the
Trust is recommended by experienced financial professionals at A.G.
Edwards & Sons, Inc. from A.G. Edwards & Sons' Diversified Stock Income
Plan ("DSIP") and is ultimately selected by the Sponsor. The Trust
includes only those stocks believed to have the potential to provide a
higher stream of income and which are considered appropriate by long-
term income and growth-oriented investors with a three-year investment
horizon. In the opinion of A.G. Edwards & Sons, Inc., a company's
ability to pay and increase a dividend is an important sign of that
company's financial strength. A.G. Edwards & Sons, Inc. has employed
this strategy since 1992, scrutinizing the dividend history (when
applicable) and long-term dividend growth potential of hundreds of
companies. Since the creation of the DSIP list in 1992, 175 companies
have had the opportunity to raise their annual dividends one or more
times since being added to the DSIP list. From this group, 165 companies
(94.3%) have, in fact, raised their annual dividends each time they have
had the opportunity. For example, if a company has been on the list for
five years, it has raised its annual dividend five times. Investors in
the Trust should be aware, however, that current dividend yields are at
historic lows for the market as a whole.
The Trust is designed to achieve two primary objectives:
- Provide a Higher Stream of Income Each Year. With a portfolio of
stocks that have the potential to raise their dividends with regularity,
conservative, income-oriented equity investors should be better able to
keep up with the rising costs of living. An objective of the Trust is to
provide investors with a portfolio of stocks with yields of at least 70%
of the S&P 500's dividend yield that will result in a growing dividend
income over time if held for a period of time, defined as two years or
more.
- Reduce Risk Through Diversification. A well-constructed portfolio
of stocks diversified across different industries and sectors can reduce
volatility and inflation risk. In fact, studies have shown that stocks
in as few as eight industries/sectors with different investment
characteristics can reduce risk to roughly that of the marketplace in
which the stocks themselves are traded.
In the Sponsor's opinion, there are several reasons to consider common
stocks of sound companies with strong dividend-paying histories. In an
uncertain market such as we are currently experiencing, rising dividends
should be considered an important component of total return. Typically,
capital appreciation is believed to be the only important building block
in securing a financial future. Many investors, however, fail to
recognize the unique role that dividends play in providing total value
to an investment. No assurance, however, can be given that the common
Page 6
stocks selected for the Diversified Income & Growth Trust, 1999 Winter
Series will consistently raise dividends or that such common stocks will
provide for capital appreciation over the life of the Trust.
Importance of Rising Dividends. Dividends should be considered an
important ingredient in the investment strategy of many investors.
Investors should look for well-managed and financially sound companies
with an outlook for solid dividend returns. Many such companies can
reward shareholders with a portion of the companies' profits in the form
of dividends with the potential to increase year after year, thus
producing strong total returns.
Reduce Volatility. Components of total return are the change in price
plus dividends an investor receives. Because prices fluctuate, dividend
income from selected, well-managed companies can be a more stable
component of total return.
To illustrate the importance of emphasizing a rising dividend strategy
and ultimately a stronger total return, consider the following
investment model, in which dividend yields rise by a half percentage
point each year for five years. This hypothetical example allows
investors to compare the importance of purchasing a stock that increases
its dividend by 5% a year, with a stock for which the dividend remains
unchanged over the entire period.
First Stock. A hypothetical dividend increasing 5% per year
<TABLE>
<CAPTION>
Current Calculated Cumulative
Dividend* Dividend Stock Price Total
Year Rate Yield (Dividend/Yield) Return
____ ________ ______ ______________ ______
<S> <C> <C> <C> <C>
1 $1.00 5.00% $20.00
2 $1.05 5.50% $19.09
3 $1.10 6.00% $18.38
4 $1.16 6.50% $17.85
5 $1.22 7.00% $17.43 14.80%
<FN>
* Rounded for display
The 14.80% Cumulative Total Return is calculated by taking the sum of
all the annual cash dividends, $5.53, adding them to the $17.43 stock
price at the end of Year 5 for a total of $22.96, and dividing that by
the beginning price of $20.00.
$22.96 divided by $20.00 = 14.80%.
</FN>
</TABLE>
Second Stock. A hypothetical dividend remaining unchanged
<TABLE>
<CAPTION>
Current Calculated Cumulative
Dividend* Dividend Stock Price Total
Year Rate Yield (Dividend/Yield) Return
____ ________ ______ ______________ ______
<S> <C> <C> <C> <C>
1 $1.00 5.00% $20.00
2 $1.00 5.50% $18.18
3 $1.00 6.00% $16.67
4 $1.00 6.50% $15.38
5 $1.00 7.00% $14.29 -3.55%
<FN>
* Rounded for display
The -3.55% Cumulative Total Return is calculated by taking the sum of
all the annual cash dividends, $5.00, adding them to the $14.29 stock
price at the end of Year 5 for a total of $19.29, and dividing that by
the beginning price of $20.00.
$19.29 divided by $20.00 = -3.55%.
</FN>
</TABLE>
The first illustration shows how rising dividends have the potential to
help minimize the effects of a declining stock market in a rising
interest rate environment and enhance an investor's total return.
Hedge Against Interest Rates & Inflation. Stocks with regularly rising
dividends tend to provide a hedge against rising interest rates. The
stock prices generally tend to increase over time in recognition of that
dividend growth. Furthermore, steadily increasing dividends have the
potential to cushion a stock price's fall when interest rates rise, as
Page 7
well as amplify a stock's total return when interest rates are stable or
declining.
Historically, companies that have increased their annual dividends at
above-average rates have given investors the ability to keep up with, or
even outpace, the effect inflation has on the increasing costs of
living. However, there is no assurance that the Equity Securities
selected for the Trust will either continue to pay or raise dividends or
that the Equity Securities will provide for capital appreciation over
the life of the Trust.
Enhance Returns. Another important consideration is reinvesting
dividends. The compounding effect of reinvesting dividends year after
year can significantly enhance a portfolio's return.
If investors diversify their portfolios with companies that have the
potential to raise their dividends regularly, in the Sponsor's opinion,
conservative, income-oriented investors should be better able to enhance
their returns.
Accrued Performance. The success of this rising dividend investment
strategy may increase further with the consideration of the following
conditions. The first and the most essential condition is that investors
begin investing as early as possible. The second condition is for
investors to reinvest as many of the dividends as they can afford.
Finally, individuals must think about all of their investments in terms
of long-term performance. In particular, investors will typically
increase their profits (through contributions and possible dividends)
through participation in tax deferred investment plans, such as IRAs and
401(k) plans.
In the case of those companies which increase their earnings over time,
stock prices have the potential to increase in recognition of that
growth. Companies who choose to reward stockholders with greater
dividends (and not a majority of companies do) help investors increase
capital and produce attractive total returns over time, particularly for
those who reinvest their dividend income.
When interest rates are stable, if companies can increase their
dividends with regularity, their stock prices tend to move up over time
in recognition of that dividend growth. If interest rates are rising,
steadily increasing dividends tend to cushion the stock prices' fall. In
addition, rising dividends help amplify stocks' total returns when
interest rates are declining. Generally, when long-term interest rates
go up, stock prices usually decline. Furthermore, a diversified stock
portfolio may perform well and may even show substantial capital
appreciation, when interest rates decline.
The Trust is designed to reduce the two primary risks investors
encounter when investing:
- Volatility (near-term risk)-The price of the investment fluctuates
so that upon selling an asset, the price may be lower than what was
originally paid.
- Inflation (long-term risk)-The investment's rate of appreciation
does not keep up with the rising cost of living.
It is important that investors achieve some level of growth in their
investments, regardless of inflation. Stocks have historically outpaced
inflation and are considered one of the best investment vehicles for
providing growth. In fact, investing in companies that have increased
their annual dividends at above average rates has given investors the
ability to keep up with, or outpace, the effect inflation has on raising
the cost of living, as well as cushioning a stock's inherent volatility
risk.
Given these factors, the Trust has been designed to provide:
- Secure dividend payments;
- Positive prospects for dividend growth over time;
- A minimum current dividend yield for each Equity Security at least
equal to 70% of the dividend yield on the S&P 500 Index.
There is, however, no assurance that the objective of the Trust will be
achieved. See "What are the Equity Securities Selected for the
Diversified Income & Growth Trust, 1999 Winter Series?-Risk Factors" for
a discussion of the risks inherent in this investment.
With the deposit of the Equity Securities on the Initial Date of
Deposit, the Sponsor established a percentage relationship between the
amounts of individual 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 Equity Securities or
cash (including a letter of credit) with instructions to purchase
additional Equity Securities in the Trust. 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 deposit by the Sponsor of additional Equity Securities, or the
Page 8
purchase of additional Equity Securities pursuant to a cash deposit,
will duplicate, as nearly as is practicable, the original proportionate
relationship 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 of
the Equity Securities deposited in the Trust on the Initial, or any
subsequent, Date of Deposit. See "Rights of Unit Holders-How May Equity
Securities be Removed from the Trust?" The original percentage
relationship of each Equity Security to the Trust is set forth herein
under "Schedule of Investments." Since the prices of the underlying
Equity Securities will fluctuate daily, the ratio, on a market value
basis, will also change daily. The portion of Equity Securities
represented by each Unit will not change as a result of the deposit of
additional Equity Securities in the Trust. 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 Equity Securities between the time of
the cash deposit and the purchase of the Equity Securities and because
the Trust will pay the associated brokerage fees. To minimize this
effect, the Trust will try to purchase the Equity Securities as close to
the evaluation time or as close to the evaluation price as possible. The
Trustee may from time to time retain and pay compensation to the Sponsor
(or an affiliate of the Sponsor) to act as agent for the Trust with
respect to acquiring Equity Securities for the Trust. In acting in such
capacity, the Sponsor or its affiliate will be held subject to the
restrictions under the Investment Company Act of 1940, as amended.
On the Initial Date of Deposit, each Unit of the Trust represented the
undivided fractional interest in the Equity Securities as set forth
under "Summary of Essential Information." To the extent that Units of
the Trust are redeemed, the aggregate value of the Equity 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 Equity Securities or cash by the Sponsor, the
aggregate value of the Equity 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 "Rights of Unit Holders-How May Units be Redeemed?"
What are the Expenses and Charges?
With the exception of the brokerage fees discussed above and bookkeeping
and other administrative services provided to the Trust, for which the
Sponsor will be reimbursed in amounts as set forth under "Summary of
Essential Information," the Sponsor will not receive any fees in
connection with its activities relating to the Trust.
First Trust Advisors L.P., an affiliate of the Sponsor, will receive an
annual supervisory fee as 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
underwriters or dealers of the Trust.
First Trust Advisors L.P., in its capacity as the Evaluator, will
receive an annual evaluation fee as set forth in the "Summary of
Essential Information" for providing evaluation services to the Trust.
Such fee is based on the largest aggregate number of Units of the Trust
outstanding during the calendar year, except during the initial offering
period, in which case the fee is calculated based on the largest number
of Units outstanding during the period for which compensation is paid.
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 calendar year, except during the initial offering period, in which
case the fee is calculated based on the largest number of Units
outstanding during the period for which compensation is paid. 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
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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 noninterest-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. Because the above fees are generally calculated
based on the largest aggregate number of Units of the Trust outstanding
during a calendar year, the per Unit amounts set forth under "Summary of
Essential Information" will be higher during any year in which
redemptions of Units occur.
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
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 and its
affiliate of supplying such services in such year.
The following additional charges are or may be incurred by the Trust:
monthly, quarterly or semi-annual statements to Unit holders; 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; any
offering costs incurred after the earlier of six months after the
Initial Date of Deposit or the end of the initial offering period;
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 Equity 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 Equity 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. 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 Trust 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, the
Sponsor is required to bear the cost of such annual audits to the extent
such cost exceeds $0.0050 per Unit. 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?
This 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 advisors 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 opinion, it is assumed that each Equity Security is
equity for Federal income tax purposes and that each REIT Share (as
defined below) represents a share in an entity treated as a real estate
investment trust 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
Page 10
owner of a pro rata portion of each 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 his pro rata share of the income derived from each Equity
Security when such income is considered to be received by the Trust.
2. Each Unit holder will be considered to have received all of the
dividends paid on his or her pro rata portion of each Equity Security
when such dividends are received by the Trust regardless of whether such
dividends are used to pay a portion of the deferred sales charge. 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. See "How are Income and Capital Distributed?-
Distribution Reinvestment Option."
3. Each Unit holder will have a taxable event when the Trust disposes
of an Equity Security (whether by sale, taxable exchange, liquidation,
redemption, or otherwise) or upon the sale or redemption of Units by
such Unit holder (except to the extent an In-Kind distribution of stocks
is received by such Unit holder as described below). The price a Unit
holder pays for his or her Units, generally including sales charges, is
allocated among his pro rata portion of each Equity Security held by the
Trust (in proportion to the fair market values thereof on the valuation
date closest to the date the Unit holder purchases his or her Units) in
order to determine the tax basis for his or her pro rata portion of each
Equity Security held by such Trust. Unit holders should consult their
own tax advisors with regard to calculation of basis. For Federal income
tax purposes, a Unit holder's pro rata portion of dividends (other than
capital gains dividends of a REIT, as described below), 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 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,
the holding period for such capital gain will be determined by the
period of time a Unit holder has held his or her Units. Certain of the
issuers of the Equity Securities intend to qualify under special Federal
income tax rules as "real estate investment trusts" (a "REIT," shares of
such issuer held by the Trust shall be referred to as the "REIT
Shares"). Because Unit holders are deemed to directly own a pro rata
portion of the REIT Shares as discussed above, Unit holders are advised
to consult their tax advisors for information relating to the tax
consequences of owning the REIT Shares. Provided such issuers qualify as
a REIT, certain distributions by such issuers on the REIT Shares may
qualify as "capital gain dividends," taxable to shareholders (and,
accordingly, to the Unit holders as owners of a pro rata portion of the
REIT Shares) as long-term capital gains, regardless of how long a
shareholder has owned such shares. In addition, distributions of income
or capital gains declared on REIT Shares in October, November or
December will be deemed to have been paid to shareholders (and,
accordingly, to the Unit holders as owners of a pro rata portion of the
REIT Shares) on December 31 of the year they are declared, even when
paid by the REIT during the following January and received by
shareholders or Unit holders in such following year.
4. A Unit holder's portion of gain, if any, upon the sale or
redemption of Units or the disposition of Equity 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
Equity 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 advisors regarding
the recognition of such capital gains and losses for Federal income tax
purposes. In addition, special rules, as described below, apply to a
Unit holder's pro rata portion of the REIT Shares.
Deferred Sales Charge. Generally, the tax basis of a Unit holder
includes sales charges, and such charges are not deductible. A portion
of the sales charge for the Trust is deferred. It is possible that for
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Federal income tax purposes a portion of the deferred sales charge may
be treated as interest which would be deductible by a Unit holder
subject to limitations on the deduction of investment interest. In such
a case, the non-interest portion of the deferred sales charge should be
added to the Unit holder's tax basis in his or her Units. The deferred
sales charge could cause the Unit holder's Units to be considered to be
debt-financed under Section 246A of the Code which would result in a
small reduction of the dividends-received deduction. In any case, the
income (or proceeds from redemption) a Unit holder must take into
account for Federal income tax purposes is not reduced by amounts
deducted to pay the deferred sales charge. Unit holders should consult
their own tax advisors as to the income tax consequences of the deferred
sales charge.
Dividends Received Deduction. A corporation that owns Units will
generally be entitled to a 70% dividends received deduction with respect
to such 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 Unit holders, such as "S"
corporations, which are not eligible for the deduction because of their
special characteristics and other than for purposes of special taxes
such as the accumulated earnings tax and the personal holding
corporation tax). However, a corporation owning Units should be aware
that Sections 246 and 246A of the Code impose additional limitations on
the eligibility of dividends for the 70% dividends received deduction.
These limitations include a requirement that stock (and therefore Units)
must generally be held at least 46 days (as determined under Section
246(c) of the Code). Final regulations have recently been issued which
address special rules that must be considered in determining whether the
46-day holding period requirement is met. Moreover, the allowable
percentage of the deduction will be reduced from 70% if a corporate Unit
holder owns certain stock (or Units) the financing of which is directly
attributable to indebtedness incurred by such corporation. DIVIDENDS
RECEIVED ON THE REIT SHARES ARE NOT ELIGIBLE FOR THE DIVIDENDS RECEIVED
DEDUCTION.
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 advisors with respect to the limitations
on and possible modifications to the dividends received deduction.
Limitations on Deductibility of the Trust's 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 such Unit holder. 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.
Unit holders should consult their tax advisors regarding the limitations
on the deductibility of Trust expenses.
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. However, any loss
realized by a Unit holder with respect to the disposition of his or her
pro rata portion of the REIT Shares, to the extent such Unit holder has
owned his Units for less than six months or the Trust has held the REIT
Shares for less than six months, will be treated as long-term capital
loss to the extent of such Unit holder's pro rata portion of any capital
gain dividends received (or deemed to have been received) with respect
to the REIT Shares. The Internal Revenue Service Restructuring and
Reform Act of 1998 (the "1998 Tax Act") provides that for taxpayers
other than corporations, net capital gain (which is defined as net long-
term capital gain over net short-term capital loss for the taxable year)
realized from property (with certain exclusions) is generally subject to
a maximum marginal stated tax rate of 20% (10% in the case of certain
taxpayers in the lowest tax bracket). Capital gain or loss is long-term
if the holding period for the asset is more than one year, and is short-
term if the holding period for the asset is one year or less. 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. Capital gains
realized from assets held for one year or less are taxed at the same
rates as ordinary income. Note, however, that the 1998 Tax Act (and The
Taxpayer Relief Act of 1997 (the "1997 Act")) provide that the
application of the rules described above in the case of pass-through
entities such as REITs will be prescribed in future Treasury
Page 12
Regulations. The Internal Revenue Service has released preliminary
guidance which provides that, in general, pass-through entities such as
REITs may designate their capital gain dividends as either a 20% rate
gain distribution, an unrecaptured Section 1250 gain distribution, or a
28% rate gain distribution, depending on the nature of the gain received
by the pass-through entity. Accordingly, Unit holders should consult
their own tax advisors as to the tax rate applicable to capital gain
dividends.
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 advisors regarding the potential effect of this
provision on their investment in Units.
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, including his or her pro rata portion of all the Equity
Securities represented by the Unit.
The 1997 Act includes provisions that treat certain transactions
designed to reduce or eliminate risk of loss and opportunities for gain
(e.g., short sales, offsetting 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 advisors with regard to any such constructive sales rules.
Special Tax Consequences of In-Kind Distributions Upon Redemption of
Units or 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 1,000 Units of the Trust
may request an In-Kind Distribution upon the redemption of Units or 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 Distribution
will be reduced by the amount of the Distribution Expenses. See "Rights
of Unit Holders-How are Income and Capital Distributed?" As previously
discussed, prior to the redemption of Units or the termination of the
Trust, a Unit holder is considered as owning a pro rata portion of each
of the Trust's assets for Federal income tax purposes. The receipt of an
In-Kind Distribution will result in a Unit holder receiving an undivided
interest in whole shares of stock plus, possibly, cash.
The potential tax consequences that may occur under an In-Kind
Distribution will depend on whether or not a Unit holder receives cash
in addition to Equity Securities. An "Equity Security" for this purpose
is a particular class of stock issued by a particular corporation or
REIT. 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 Equity Securities, a Unit holder who
requests an In-Kind Distribution will have to analyze the tax
consequences with respect to each Equity Security owned by the Trust. If
the Unit holder is deemed to recognize gain or loss on the In-Kind
Distribution because cash is received in addition to Equity Securities,
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 Equity Security
owned by the Trust. Unit holders who request an In-Kind Distribution are
advised to consult their tax advisors 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 valuation date
nearest 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 that payments to the Unit holder are
Page 13
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 (other than those that are not
treated as U.S. source income, if any) will generally be subject to U.S.
income taxation and withholding in the case of Units held by non-
resident alien individuals, foreign corporations or other non-U.S.
persons. Such persons should consult their tax advisors.
At the termination of the Trust, the Trustee will furnish to each Unit
holder a statement containing information relating to the dividends
received by the Trust on the Equity Securities, the gross proceeds
received by the Trust from the disposition of any Equity Security
(resulting from redemption of the sale of any Equity Security) and the
fees and expenses paid by the Trust. The Trustee will also furnish
annual information returns to Unit holders and to the Internal Revenue
Service.
Unit holders will be notified annually of the amounts of 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 "Are Investments in the Trust Eligible for
Retirement Plans?"
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.
The foregoing discussion relates only to the tax treatment of United
States Unit holders ("U.S. Unit holders") with regard to United States
Federal income taxes; Unit holders may be subject to foreign, state and
local taxation. As used herein, the term "U.S. Unit holder" means an
owner of a Unit in the Trust that (a) is (i) for United States Federal
income tax purposes a citizen or resident of the United States, (ii) a
corporation, partnership or other entity created or organized in or
under the laws of the United States or of any political subdivision
thereof, or (iii) an estate or trust the income of which is subject to
United States Federal income taxation regardless of its source or (b)
does not qualify as a U.S. Unit holder in paragraph (a) but whose income
from a Unit is effectively connected with such Unit holder's conduct of
a United States trade or business. The term also includes certain former
citizens of the United States whose income and gain on the Units will be
taxable. Unit holders should consult their tax advisors regarding
potential foreign, state or local taxation with respect to the Units.
Unit holders should consult their tax advisors regarding potential state
or local taxation with respect to the Units.
Are Investments in the Trust Eligible for Retirement Plans?
Units of the Trust are eligible for purchase by Individual Retirement
Accounts, Roth Individual Retirement Accounts, Education 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 advisors
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 the Equity Securities?
The Trust consists of different issues of Equity Securities which are
listed on a national securities exchange or The Nasdaq Stock Market or
traded in the over-the-counter market. See "What are the Equity
Securities Selected for the Diversified Income & Growth Trust, 1999
Winter Series?"
Page 14
What are the Equity Securities Selected for the Diversified Income &
Growth Trust, 1999 Winter Series?
CAPITAL GOODS
Emerson Electric Co., headquartered in St. Louis, Missouri, designs,
makes and sells electrical, electro-mechanical 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 programs, and operates
VHF and UHF TV stations; and provides financial services.
COMMUNICATIONS/MEDIA
Ameritech Corporation, headquartered in Chicago, Illinois, provides a
wide range of communications services, including local and long distance
telephone, cellular, paging, security, cable TV, Internet access and
directory publishing services.
Bell Atlantic Corporation, headquartered in New York, New York, operates
a diversified telecommunications concern that provides voice and data
transport and calling services network access, directory publishing and
public telephone services to customers in the mid-Atlantic and New
England regions.
CONSUMER NON-DURABLES
Dean Foods Company, headquartered in Franklin Park, Illinois, through
subsidiaries, processes, sells and distributes dairy, pickle and
specialty food products.
Flowers Industries, Inc., headquartered in Thomasville, Georgia, with
subsidiaries, produces a full line of baked goods, including "Flowers'
Bakeries" fresh breads and rolls, "Mrs. Smith's Bakeries" fresh and
frozen baked desserts, snacks, breads and rolls, and "Keebler's" cookies
and crackers.
H.J. Heinz Company, headquartered in Pittsburgh, Pennsylvania, makes,
packages, and sells processed food products including ketchup and
sauces/condiments, pet food, seafood products, baby food, soups, lower-
calorie products, bakery products, frozen dinners and entrees, frozen
pizza and other products. The company also provides weight control
services.
Procter & Gamble Company, headquartered in Cincinnati, Ohio, makes
detergents, fabric conditioners, and hard surface cleaners; products for
personal cleansing, oral care, digestive health, hair and skin; paper
tissue, disposable diapers, and pharmaceuticals; shortenings, oils,
snacks, baking mixes, peanut butter, coffee, drinks and citrus products.
Sara Lee Corporation, headquartered in Chicago, Illinois, makes, markets
and distributes packaged food, packaged consumer goods, and household
and personal care products throughout the world.
ENERGY
Amoco Corporation, headquartered in Chicago, Illinois, operates one of
the largest worldwide integrated petroleum and chemical organizations in
the world. The company explores for, develops and produces crude oil and
natural gas; refines, markets and transports petroleum and related
products; and manufactures and sells chemical products.
Mobil Corporation, headquartered in Fairfax, Virginia, produces,
transports, refines and markets petroleum, natural gas and related
products; and makes and markets chemicals.
FINANCIAL-REITS
Chateau Communities, Inc., headquartered in Englewood, Colorado, is a
self-managed real estate investment trust which owns and operates
manufactured home community properties in 29 states.
Fannie Mae, headquartered in Washington, D.C., provides ongoing
assistance to the secondary market for residential mortgages by
providing liquidity for residential mortgage investments, thereby
improving the distribution of investment capital available for such
mortgage financing.
JDN Realty Corporation, headquartered in Atlanta, Georgia, is a self-
managed real estate investment trust which owns and operates shopping
center properties in 12 states.
Nationwide Health Properties, Inc., headquartered in Newport Beach,
California, is a self-managed real estate investment trust with
interests in healthcare facilities in 33 states, including long-term
health facilities, assisted living facilities, retirement communities
and rehabilitation hospitals. The company also provides financing to
healthcare providers.
Page 15
HEALTHCARE
American Home Products Corporation, headquartered in Madison, New
Jersey, makes nutritionals, cardiovascular and metabolic disease
therapies, mental health products, anti-inflammatory/analgesic products
and vaccines; over-the-counter drugs; and crop protection and pest
control products.
Johnson & Johnson, headquartered in New Brunswick, New Jersey, makes and
sells pharmaceuticals, personal healthcare products, medical and
surgical equipment, and contact lenses.
Merck & Co., Inc., headquartered in Whitehouse Station, New Jersey, is a
leading pharmaceutical concern that discovers, develops, makes and
markets a broad range of human and animal health products and services.
The company also administers managed prescription drug programs.
Schering-Plough Corporation, headquartered in Madison, New Jersey,
develops, makes and markets pharmaceutical and healthcare products
worldwide including prescription drugs, animal health, over-the-
counter, foot care and sun care products.
RETAIL/APPAREL
The May Department Stores Company, headquartered in St. Louis, Missouri,
operates department stores under the trade names "Lord & Taylor,"
"Hecht's," "Strawbridge's," "Foley's," "Robinsons-May," "Kaufmann's,"
"Filene's," "Famous-Barr," "L.S. Ayres" and "Meier & Frank" in 30 states
and Washington, D.C.
UTILITY
American Water Works Company, Inc., headquartered in Voorhees, New
Jersey, provides water service to approximately 7 million people in 21
states. The company also provides professional services as required to
affiliated companies.
Piedmont Natural Gas Company, Inc., headquartered in Charlotte, North
Carolina, transports and sells natural gas in North Carolina, South
Carolina and Tennessee; acquires, sells and transports natural gas to
large volume purchasers; and sells propane and associated products.
Sierra Pacific Resources, headquartered in Reno, Nevada, supplies
electricity in western, central and northeastern parts of Nevada and
eastern California; and it supplies water and gas in the Reno and
Sparks, Nevada areas.
The Sponsor has obtained the foregoing company descriptions from sources
it deems reliable. The Sponsor has not independently verified the
provided information either in terms of accuracy or completeness.
Risk Factors. All of the Equity Securities are of domestic companies.
There are no preferred stock or convertible debt issues, nor are there
stocks of foreign companies.
The Trust consists of such of the Equity Securities listed under
"Schedule of Investments" as may continue to be held from time to time
in the Trust and any additional Equity Securities acquired and held by
the Trust pursuant to the provisions of the Indenture 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 Equity
Securities. However, should any contract for the purchase of any of the
Equity 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 Equity Securities in accordance
with the Indenture, refund the cash and sales charge 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 or keep any
securities or other property acquired in exchange for Equity Securities
such as those acquired in connection with a merger or other transaction.
See "Rights of Unit Holders-How May Equity 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.
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.
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. The past market and earnings performance of the Equity
Securities included in the Trust is not predictive of their future
performance. Common stocks are especially susceptible to general stock
market movements and to volatile increases and decreases of value as
market confidence in and perceptions of the issuers change. These
perceptions are based on unpredictable factors, including expectations
regarding government, economic, monetary and fiscal policies, inflation
and interest rates, economic expansion or contraction, and global or
regional political, economic or banking crises. 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 they 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.
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.
A.G. Edwards & Sons, Inc., 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. A.G. Edwards & Sons,
Inc. also from time to time may issue reports on and make
recommendations relating to equity securities, which may include the
Equity Securities.
The criteria for inclusion in the Trust were applied to the Equity
Securities immediately prior to the Initial Date of Deposit. Since the
Sponsor may deposit additional Equity Securities, the Sponsor may
continue to sell Units of the Trust even though the dividend yields on
Equity Securities may have changed and would no longer justify inclusion
in the Trust. Equity Securities included in the Trust may have been
rated by A.G. Edwards & Sons, Inc. in research reports as other than
buy, accumulate or maintain at the time of the Initial Date of Deposit
because of the three-year investment horizon for the Trust which may
vary from the time horizon for research reports. In addition, the
Page 17
Sponsor will continue to sell Units of the Trust even if A.G. Edwards &
Sons, Inc. changes a recommendation relating to an Equity Security.
Investors should also note that because A.G. Edwards & Sons, Inc. uses
the list of Equity Securities which comprises the portfolio in its
independent capacity as a broker/dealer and as an investment advisor to
individuals, mutual funds, employee benefit plans and other institutions
and persons and distributes this information to various individuals and
entities, A.G. Edwards & Sons, Inc. may recommend or effect from time to
time the purchase or sale of one or more of the Equity Securities. This
may have an effect on the prices of the Equity Securities which is
adverse to the interest of the purchasers of Units of the Trust.
Additionally, this may have an impact on the price paid by the Trust for
the Equity Securities as well as the price received upon redemption of
the Units or upon the termination of the Trust.
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 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, including the
impact of the Sponsor's purchase and sale of the Equity Securities
(especially during the initial offering period of Units of the Trust)
and other factors.
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 Equity Security will not be delivered ("Failed Contract
Obligations") to the Trust, the Sponsor is authorized under the
Indenture to direct the Trustee to acquire other Equity Securities
("Replacement Securities"). Any Replacement Security will 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
paragraphs is not utilized to acquire Replacement Securities in the
event of a failed contract, the Sponsor will refund the sales charge
attributable to such Failed Contract Obligations to all Unit holders of
the Trust, and 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 the 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
Equity Securities or cash (including a letter of credit) with
instructions to purchase additional Equity Securities in the Trust and
the issuance of a corresponding number of additional Units. If the
Sponsor deposits cash, however, existing and new investors may
experience a dilution of their investment and a reduction in their
anticipated income because of fluctuations in the prices of the Equity
Securities between the time of the cash deposit and the purchase of the
Equity Securities and because the Trust will pay the associated
brokerage fees.
The Trust consists of the Equity 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 Equity
Securities acquired and held by the Trust pursuant to the provisions of
the Indenture (including provisions with respect to deposits into the
Trust of Equity Securities or cash in connection with the issuance of
additional Units).
Once all of the Equity 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
Equity Securities only under limited circumstances. See "Rights of Unit
Holders-How May Equity Securities be Removed from the Trust?"
Like other investment companies, financial and business organizations
and individuals around the world, the Trust could be adversely affected
if the computer systems used by the Sponsor, Evaluator, Portfolio
Page 18
Supervisor or Trustee or other service providers to the Trust do not
properly process and calculate date-related information and data
involving dates of January 1, 2000 and thereafter. This is commonly
known as the "Year 2000 Problem." The Sponsor, Evaluator, Portfolio
Supervisor and Trustee are taking steps that they believe are reasonably
designed to address the Year 2000 Problem with respect to computer
systems that they use and to obtain reasonable assurances that
comparable steps are being taken by the Trust's other service providers.
At this time, however, there can be no assurance that these steps will
be sufficient to avoid any adverse impact to the Trust.
The Year 2000 Problem is expected to impact corporations, which may
include issuers of the Equity Securities contained in the Trust, to
varying degrees based upon various factors, including, but not limited
to, their industry sector and degree of technological sophistication.
The Sponsor is unable to predict what impact, if any, the Year 2000
Problem will have on issuers of the Equity Securities contained in 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 Equity 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 Equity
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 advisors. Further, at any time after the
Initial Date of Deposit, legislation may be enacted that could
negatively affect the Equity Securities in the Trust or the issuers of
the Equity Securities. Changing approaches to regulation, particularly
with respect to any of the industries represented in the portfolio of
the Trust, 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
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,
plus an initial sales charge equal to the difference between the maximum
sales charge of 3.3% of the Public Offering Price and the maximum
remaining deferred sales charge, initially $.23 per Unit. Subsequent to
the Initial Date of Deposit, the amount of the initial sales charge will
vary with changes in the aggregate value of the Equity Securities.
Commencing on August 20, 1999, and on the twentieth day of each month
thereafter (or if such date is not a business day, on the preceding
business day) through December 20, 1999, a deferred sales charge of
$.046 will be assessed per Unit per month. Units purchased subsequent to
the initial deferred sales charge payment but still during the initial
offering period will be subject to the initial sales charge and the
remaining deferred sales charge payments not yet collected. The deferred
sales charge will be paid from funds in the Capital Account, if
sufficient, or from the periodic sale of Equity Securities. The total
maximum sales charge assessed to Unit holders on a per Unit basis will
be 3.3% of the Public Offering Price (equivalent to 3.333% of the net
amount invested, exclusive of the deferred sales charge). In addition, a
portion of the Public Offering Price on Units purchased prior to the
earlier of six months after the Initial Date of Deposit or the end of
the initial offering period also consists of Equity Securities in an
amount sufficient to pay for all or a portion of the costs incurred in
establishing the Trust, including the costs of preparing the
registration statement, the Indenture and other closing documents,
registering Units with the Securities and Exchange Commission and
states, the initial audit of the Trust portfolio, legal fees and the
initial fees and expenses of the Trustee. The estimated organizational
and offering costs will be deducted from the assets of the Trust as of
the earlier of six months after the Initial Date of Deposit or the end
of the initial offering period. Upon completion of the deferred sales
charge period, the secondary market Public Offering Price per Unit for
Page 19
the Trust will not include deferred payments, but will instead include
only a one-time initial sales charge of 3.3% of the Public Offering
Price (equivalent to 3.413% of the net amount invested), which will be
reduced to a minimum sales charge of 2.8% of the Public Offering Price
per Unit on January 3, 2000.
During the initial offering period, the Sponsor's Repurchase Price is
based on 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, plus, until the earlier of six months after the
Initial Date of Deposit or the end of the initial offering period,
estimated organizational and offering costs, divided by the number of
Units of the Trust outstanding and reduced by any deferred sales charge
not yet paid. During the secondary market, the Sponsor's Repurchase
Price is also based on the aggregate underlying value of the Equity
Securities in the Trust (generally determined by the closing sale prices
of listed Equity Securities and the bid 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 outstanding
Units in the Trust.
The minimum amount which an investor may purchase of the Trust is $1,000
($500 for Individual Retirement Accounts, Roth Individual Retirement
Accounts, Education Individual Retirement Accounts or other retirement
plans). The applicable sales charge for both primary and secondary
market sales is reduced by a discount as indicated below for volume
purchases as a percentage of the Public Offering Price (except for sales
made pursuant to a "wrap fee account" or similar arrangements as set
forth below).
<TABLE>
<CAPTION>
Maximum
Dollar Amount of Transaction Sales Net Dealer
at Public Offering Price* Discount Charge Concession
______________________ ________ __________ __________
<S> <C> <C> <C>
$ 50,000 but less than $100,000 0.25% 3.05% 2.20%
$ 100,000 but less than $150,000 0.50% 2.80% 1.95%
$ 150,000 but less than $500,000 0.85% 2.45% 1.60%
$ 500,000 but less than $1,000,000 1.20% 2.10% 1.30%
$1,000,000 or more 1.75% 1.55% 1.10%
<FN>
* The breakpoint sales charges are also applied on a Unit basis
utilizing a breakpoint equivalent in the above table of $10 per Unit and
will be applied on whichever basis is more favorable to the investor.
The breakpoints will be adjusted to take into consideration purchase
orders stated in dollars which cannot be completely fulfilled due to the
requirement that only whole Units be issued.
</FN>
</TABLE>
Any such reduced sales charge shall be the responsibility of the selling
broker/dealer, bank or other selling agent. The reduced sales charge
structure will apply on all purchases of Units in the Trust by the same
person on any one day from any one broker/dealer, bank or other selling
agent. An investor may aggregate same day purchases of Units of the
Trust contained in this Prospectus and units of other unit investment
trusts containing equity securities for which the Sponsor acted as
Principal Underwriter which are currently in the initial offering period
for purposes of qualifying for volume purchase discounts listed above.
Unit holders may use redemption or termination proceeds from unit
investment trusts for which the Sponsor acted as Principal Underwriter
to purchase Units of the Trust subject only to the maximum deferred
sales charge on such Units, deferred as set forth above. Additionally,
Units purchased in the name of the spouse of a purchaser or in the name
of a child of such purchaser under 21 years of age will be deemed, for
the purposes of calculating the applicable sales charge, to be
additional purchases by the purchaser. The reduced sales charges will
also be applicable to a trustee or other fiduciary purchasing securities
for a single trust estate or single fiduciary account. The purchaser
must inform the broker/dealer, bank or other selling agent of any such
combined purchase prior to the sale, in order to obtain the indicated
discount. In addition, with respect to employees, officers and directors
(including their immediate family members, defined as spouses, children,
grandchildren, parents, grandparents, siblings, mothers-in-law, fathers-
in-law, sons-in-law and daughters-in-law, and trustees, custodians or
fiduciaries for the benefit of such persons) of the Sponsor,
broker/dealers, banks or other selling agents and their subsidiaries and
vendors providing services to the Sponsor, Units may be purchased at the
Public Offering Price less the concession the Sponsor typically allows
to dealers and other selling agents.
Units may be purchased in the primary or secondary market at the Public
Offering Price less the concession the Sponsor typically allows to
dealers and other selling agents (see "Public Offering-How are Units
Page 20
Distributed?") for purchases by investors who purchase Units through
registered investment advisers, certified financial planners or
registered broker/dealers who in each case either charge periodic fees
for financial planning, investment advisory or asset management
services, or provide such services in connection with the establishment
of an investment account for which a comprehensive "wrap fee" charge is
imposed.
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 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 Equity Securities. During the initial offering period,
the aggregate value of the Units of the Trust shall be determined on the
basis of the aggregate underlying value of the Equity Securities therein
plus or minus cash, if any, in the Income and Capital Accounts of the
Trust. The aggregate underlying value of the Equity Securities will be
determined in the following manner: if the Equity Securities are listed,
this evaluation is generally based on the closing sale prices on that
exchange (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, 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 prices 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 21
The Evaluator on each business day will appraise or cause to be
appraised the value of the underlying Equity Securities in the Trust as
of the Evaluation Time and will adjust the Public Offering Price of the
Units commensurate with such valuation. Such Public Offering Price will
be effective for all orders received prior to the Evaluation Time on
each such day. Orders received by the Trustee or Sponsor for purchases,
sales or redemptions after that time, or on a day which is not a
business day, will be held until the next determination of price. The
term "business day," as used herein and under "Rights of Unit Holders-
How May Units be Redeemed?", shall exclude Saturdays, Sundays and the
following holidays as observed by the New York Stock Exchange, Inc.: New
Year's Day, Presidents' Day, Good Friday, Memorial Day, Independence
Day, Labor Day, Thanksgiving and Christmas Day.
After the completion of the initial offering period, the secondary
market Public Offering Price will be equal to the aggregate underlying
value of the Equity Securities therein, plus or minus cash, if any, in
the Income and Capital Accounts of the Trust plus the applicable sales
charge. The aggregate underlying value of the Equity Securities for
secondary market sales is calculated in the same manner as described
above for sales made during the initial offering period with the
exception that bid prices are used instead of ask prices.
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 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 Equity Securities are deposited by the Sponsor, Units will be
distributed to the public at the then current Public Offering Price. The
initial offering period may be up to approximately 360 days. During such
period, the Sponsor may deposit additional Equity Securities or cash in
the Trust and create additional Units. Units reacquired by the Sponsor
during the initial offering period may be resold at the then current
Public Offering Price.
Page 21
Upon completion of the initial offering, Units repurchased in the
secondary market (see "Public Offering-Will There be a Secondary
Market?") may be offered by this prospectus at the secondary market
public offering price determined in the manner described above.
It is the intention of the Sponsor to qualify Units of the Trust for
sale in a number of states. Sales initially will be made to dealers and
other selling agents at prices which represent a concession or agency
commission of 2.4% of the Public Offering Price for primary and
secondary market sales (or 65% of the then current maximum sales charge
on January 3, 2000 and thereafter). Dealers and other selling agents
will receive a concession or agency commission on the sale of Units
subject only to the remaining deferred sales charge equal to: (i) $.15
per Unit on Units sold subject to a deferred sales charge of $.23 per
Unit; or (ii) 65% of the then current maximum remaining deferred sales
charge on Units sold subject to a deferred sales charge of less than
$.23 per Unit. Such concession will vary based upon the month of a
Trust's Initial Date of Deposit.
Effective on January 3, 2000, the sales charge will be reduced to a
minimum sales charge of 2.8% of the Public Offering Price per Unit.
However, resales of Units of the Trust by such dealers and other selling
agents to the public will be made at the Public Offering Price described
in the prospectus. In addition, dealers and other selling agents who
sell at least $15,000,000 on the Initial Date of Deposit will receive an
additional volume concession or agency commission with respect to total
sales of Units in the amounts set forth below:
Additional
Total Sales Concession*
____________ ___________
$ 15,000,000 0.100%
$ 25,000,000 0.200%
$ 35,000,000 0.375%
$ 45,000,000 0.400%
$ 55,000,000 0.425%
$ 75,000,000 0.525%
$100,000,000 or more 0.625%
* Breakpoint sales are not included in this calculation.
No dealer concession will be made for sales to "wrap fee accounts" or
similar arrangements, or for sales made to employees, officers and
directors of the Sponsor, dealers or vendors providing services to the
Sponsor. The Sponsor reserves the right to change the amount of the
concession or agency commission from time to time. Certain commercial
banks may be making Units of the Trust available to their customers on
an agency basis. A portion of the sales charge paid by these customers
is retained by or remitted to the banks in the amounts indicated above.
Under the Glass-Steagall Act, banks are prohibited from underwriting
Trust Units; however, the Glass-Steagall Act does permit certain agency
transactions and the banking regulators have not indicated that these
particular agency transactions are not permitted under such Act. In
Texas and in certain other states, any banks making Units available must
be registered as broker/dealers under state law.
From time to time the Sponsor may implement programs under which dealers
of the Trust may receive nominal awards from the Sponsor for each of
their registered representatives who have sold a minimum number of UIT
Units during a specified time period. In addition, at various times the
Sponsor may implement other programs under which the sales force of
dealers may be eligible to win other nominal awards for certain sales
efforts, or under which the Sponsor will reallow to any such dealer that
sponsors sales contests or recognition programs conforming to criteria
established by the Sponsor, or participates in sales programs sponsored
by Sponsor, an amount not exceeding the total applicable sales charges
on the sales generated by such person at the public offering price
during such programs. Also, the Sponsor in its discretion may from time
to time pursuant to objective criteria established by the Sponsor pay
fees to qualifying dealers for certain services or activities which are
primarily intended to result in sales of Units of the Trust. Such
payments are made by the Sponsor out of its own assets, and not out of
the assets of the Trust. These programs will not change the price Unit
holders pay for their Units or the amount that the Trust will receive
from the Units sold.
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
Page 22
specified periods on other similar Trusts sponsored by Nike Securities
L.P. with returns on other taxable investments such as the common stocks
comprising the Dow Jones Industrial Average, 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
principal, but pay interest at rates that vary with the condition of the
short-term debt market. The investment characteristics of the Trust are
described more fully elsewhere in this Prospectus.
Information on percentage changes in the dollar value of Units, on the
basis of changes in Unit price may be included from time to time in
advertisements, sales literature, reports and other information
furnished to current or prospective Unit holders. Total return figures
are not averaged, and may not reflect deduction of the sales charge,
which would decrease the return. Average annualized return figures
reflect deduction of the maximum sales charge. No provision is made for
any income taxes payable.
Past performance may not be indicative of future results. The Trust's
portfolio is not managed. Unit price and return fluctuate with the value
of the common stocks in the Trust's portfolio, so there may be a gain or
loss when Units are sold.
Trust performance may be compared to performance on a total return basis
of the Dow Jones Industrial Average(sm), the S&P 500 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.
What are the Sponsor's Profits?
The Sponsor of the Trust will receive a gross sales commission equal to
3.3% of the Public Offering Price of the Units per Unit sold (equivalent
to 3.333% of the net amount invested, exclusive of the deferred sales
charge), less any reduced sales charge as described under "Public
Offering-How is the Public Offering Price Determined?" Pursuant to a
licensing agreement with A.G. Edwards & Sons, Inc., the Sponsor will pay
to A.G. Edwards & Sons, Inc. $.0075 per Unit for allowing the Sponsor
use of the name "Diversified Stock Income Plan" (the "DSIP") and for
periodic research reports relating to the Equity Securities contained in
the "Diversified Stock Income Plan" portfolio. See "Public Offering-How
are Units Distributed?" for information regarding the receipt of
additional concessions available to dealers and other selling agents. 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 Equity Securities to the Trust (which
is based on the Evaluator's determination of the aggregate offering
price of the underlying Equity Securities of such Trust on the Initial
Date of Deposit as well as subsequent deposits) and the cost of such
Equity Securities to the Sponsor. See Note (2) of "Schedule of
Investments."
In maintaining a market for the Units, the Sponsor will also realize
profits or sustain losses in the amount of any difference between the
price at which Units are purchased and the price at which Units are
resold (which price includes a sales charge of 3.3% which will be
reduced to 2.8% on January 3, 2000) or redeemed. The secondary market
public offering price of Units may be greater or less than the cost of
such Units to the Sponsor.
Will There be a Secondary Market?
After the initial offering period, although not obligated to do so, the
Sponsor intends to maintain a market for the Units and continuously
offer to purchase Units at prices, subject to change at any time, based
upon 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. All expenses incurred in maintaining a secondary market,
other than the fees of the Evaluator and the costs of the Trustee in
transferring and recording the ownership of Units, will be borne by the
Sponsor. If the supply of Units exceeds demand, or for some other
business reason, the Sponsor may discontinue purchases of Units at such
prices. IF A UNIT HOLDER WISHES TO DISPOSE OF HIS UNITS, HE SHOULD
INQUIRE OF THE SPONSOR AS TO CURRENT MARKET PRICES PRIOR TO MAKING A
Page 23
TENDER FOR REDEMPTION TO THE TRUSTEE. Units subject to a deferred sales
charge which are sold or tendered for redemption prior to such time as
the entire deferred sales charge on such Units has been collected will
be assessed the amount of the remaining deferred sales charge at the
time of sale or redemption.
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.
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 (i.e., book-
entry) 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 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 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 Distribution Record
Date. See "Summary of Essential Information." Persons who purchase Units
will commence receiving distributions only after such person becomes a
record owner. Notification to the Trustee of the transfer of Units is
the responsibility of the purchaser, but in the normal course of
business such notice is provided by the selling broker/dealer. 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 Equity 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 such month if the amount available for distribution equals at
least $0.01 per Unit. 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).
Page 24
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. See "What is the Federal Tax Status of Unit Holders?"
It is anticipated that the deferred sales charge will be collected from
the Capital Account and that amounts in the Capital Account will be
sufficient to cover the cost of the deferred sales charge. However, to
the extent that amounts in the Capital Account are insufficient to
satisfy the then current deferred sales charge obligation, Equity
Securities may be sold to meet such shortfall. Distributions of amounts
necessary to pay the deferred portion of the sales charge will be made
to an account designated by the Sponsor for purposes of satisfying Unit
holders' deferred sales charge obligations.
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
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 under
"Other Information-How May the Indenture be Amended or Terminated?" and
(ii) a pro rata share of any other assets of the Trust, less expenses of
the Trust.
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 Equity
Securities sold during the year and the Equity 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. The Trustee shall also furnish to
Unit holders a statement on a quarterly basis which describes the
performance of the Trust.
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.
Page 25
How May Units be Redeemed?
A Unit holder may redeem all or a portion of his or her Units by
tendering to the Trustee, at its unit investment trust office in the
City of New York, the certificates representing the Units to be
redeemed, or in the case of uncertificated Units, delivery of a request
for redemption, duly endorsed or accompanied by proper instruments of
transfer with signature guaranteed as explained above (or by providing
satisfactory indemnity, as in connection with lost, stolen or destroyed
certificates), and payment of applicable governmental charges, if any.
No redemption fee will be charged. On the third business day following
such tender, the Unit holder will be entitled to receive in cash an
amount for each Unit equal to the Redemption Price per Unit next
computed after receipt by the Trustee of such tender of Units. The "date
of tender" is deemed to be the date on which Units are received by the
Trustee (if such day is a day in 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. Units
tendered for redemption prior to such time as the entire deferred sales
charge on such Units has been collected will be assessed the amount of
remaining deferred sales charge at the time of redemption.
Any Unit holder tendering 1,000 Units or more for redemption may request
by written notice submitted at the time of tender from the Trustee, in
lieu of a cash redemption, a distribution of shares of Equity Securities
in an amount and value of Equity Securities per Unit equal to the
Redemption Price Per Unit as determined as of the evaluation next
following tender. However, no In-Kind Distribution requests submitted
during the nine business days prior to the Mandatory Termination Date
will be honored. To the extent possible, In-Kind Distributions shall be
made by the Trustee through the distribution of each of the Equity
Securities in book-entry form to the account of the Unit holder's bank
or broker/dealer at the Depository Trust Company. An In-Kind
Distribution will be reduced by customary transfer and registration
charges. The tendering Unit holder will receive his pro rata number of
whole shares of each of the Equity Securities comprising the portfolio
and cash from the Capital Account equal to the fractional shares to
which the tendering Unit holder is entitled. The Trustee may adjust the
number of shares of any issue of Equity Securities included in a Unit
holder's In-Kind Distribution to facilitate the distribution of whole
shares, such adjustment to be made on the basis of the value of Equity
Securities on the date of tender. See "What is the Federal Tax Status of
Unit Holders?" If funds in the Capital Account are insufficient to cover
the required cash distribution to the tendering Unit holder, the Trustee
may sell Equity Securities in the manner described above.
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. For further information regarding this withholding, see
"Rights of Unit Holders-How are Income and Capital Distributed?" In the
event the Trustee has not been previously provided such number, one must
be provided at the time redemption is requested.
Any amounts paid on redemption representing income shall be withdrawn
from the Income Account of 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 Equity Securities of the Trust in order
to make funds available for redemption. To the extent that Equity
Securities are sold, the size and diversity of the Trust will be
reduced. Such sales may be required at a time when Equity Securities
would not otherwise be sold and might result in lower prices than might
otherwise be realized.
The Redemption Price per Unit will be determined on the basis of the
aggregate underlying value of the Equity Securities in the Trust
(generally determined by the closing sale prices of the listed Equity
Securities and either the ask prices (during the initial offering
period) or the bid prices (subsequent to the initial offering period) of
the over-the-counter traded Equity Securities) plus or minus cash, if
any, in the Income and Capital Accounts of the Trust. The Redemption
Price per Unit is the pro rata share of each Unit determined by the
Page 26
Trustee by adding: (1) the cash on hand in the Trust other than cash
deposited in the Trust to purchase Equity Securities not applied to the
purchase of such Equity Securities; (2) the aggregate value of the
Equity Securities held in the Trust, as determined by the Evaluator on
the basis of 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) any amounts owing to
the Trustee for its advances; (3) an amount representing estimated
accrued expenses of the Trust, including but not limited to fees and
expenses of the Trustee (including legal and auditing fees), the
Evaluator and supervisory fees, if any; (4) cash held for distribution
to Unit holders of record of the Trust as of the business day prior to
the evaluation being made; and (5) 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
Redemption Price per Unit will be assessed the amount, if any, of the
remaining deferred sales charge at the time of redemption. Until the
earlier of six months after the Initial Date of Deposit or the end of
the initial offering period, the Redemption Price per Unit will include
estimated organizational and offering costs as set forth under "Summary
of Essential Information."
The aggregate value of the Equity Securities will be determined in the
following manner: if the Equity Securities are listed, this evaluation
is generally based on the closing sale prices on that exchange (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, at
the closing ask prices (during the initial offering period) or at the
closing bid prices (subsequent to the initial offering period). 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 or bid prices (as appropriate) on
the over-the-counter market (unless these prices are inappropriate as a
basis for evaluation). If current ask or bid prices (as appropriate) are
unavailable, the evaluation is generally determined (a) on the basis of
current ask or bid prices (as appropriate) for comparable securities,
(b) by appraising the value of the Equity Securities on the ask or bid
side of the market (as appropriate) 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.
How May Units be Purchased by the Sponsor?
The Trustee shall notify the Sponsor of any tender of Units for
redemption. If the Sponsor's bid in the secondary market at that time
equals or exceeds the Redemption Price per Unit, it may purchase such
Units by notifying the Trustee before 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
resale or redemption of such Units will belong to the Sponsor.
How May Equity 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
Page 27
(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, or
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. Except as stated under "Portfolio-What are Some Additional
Considerations for Investors?" for Failed Contract Obligations, the
acquisition by the Trust of any securities or other property other than
the Equity 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 Equity Securities (or
any securities or other property received by the Trust in exchange for
Equity 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 from time to time retain and pay compensation to the Sponsor
(or an affiliate of the Sponsor) to act as agent for the Trust with
respect to selling Equity Securities from the Trust. In acting in such
capacity the Sponsor or its affiliate will be held subject to the
restrictions under the Investment Company Act of 1940, as amended.
The Trustee may also sell Equity 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.
The Sponsor, in designating Equity 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 Equity Securities. To the extent this is not
practicable, the composition and diversity of the Equity 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 (generally 100
shares) in which blocks of Equity Securities are to be sold.
INFORMATION AS TO SPONSOR, TRUSTEE AND EVALUATOR
Who is the Sponsor?
Nike Securities L.P., the Sponsor, specializes in the underwriting,
trading and distribution of unit investment trusts and other securities.
Nike Securities L.P., an Illinois limited partnership formed in 1991,
acts as Sponsor for successive series of The First Trust Combined
Series, FT Series (formerly known as The First Trust Special Situations
Trust), The First Trust Insured Corporate Trust, The First Trust of
Insured Municipal Bonds and The First Trust GNMA. First Trust introduced
the first insured unit investment trust in 1974 and to date more than
$20 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, 1997, the total partners' capital of Nike
Securities L.P. was $11,724,071 (audited). This paragraph relates only
to the Sponsor and not to the Trust or to any series thereof. The
information is included herein only for the purpose of informing
investors as to the financial responsibility of the Sponsor and its
ability to carry out its contractual obligations. More detailed
financial information will be made available by the Sponsor upon request.
Who is the Trustee?
The Trustee is The Chase Manhattan Bank, with its principal executive
office located at 270 Park Avenue, New York, New York 10017 and its unit
Page 28
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 Equity Securities. For information
relating to the responsibilities of the Trustee under the Indenture,
reference is made to the material set forth under "Rights of Unit
Holders."
The Trustee and any successor trustee may resign by executing an
instrument in writing and filing the same with the Sponsor and mailing a
copy of a notice of resignation to all Unit holders. Upon receipt of
such notice, the Sponsor is obligated to appoint a successor trustee
promptly. If the Trustee becomes incapable of acting or becomes bankrupt
or its affairs are taken over by public authorities, the Sponsor may
remove the Trustee and appoint a successor as provided in the Indenture.
If upon resignation of a trustee no successor has accepted the
appointment within 30 days after notification, the retiring trustee may
apply to a court of competent jurisdiction for the appointment of a
successor. The resignation or removal of a trustee becomes effective
only when the successor trustee accepts its appointment as such or when
a court of competent jurisdiction appoints a successor trustee.
Any corporation into which a Trustee may be merged or with which it may
be consolidated, or any corporation resulting from any merger or
consolidation to which a Trustee shall be a party, shall be the
successor Trustee. The Trustee must be a banking corporation organized
under the laws of the United States or any State and having at all times
an aggregate capital, surplus and undivided profits of not less than
$5,000,000.
Limitations on Liabilities of Sponsor and Trustee
The Sponsor and 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 Equity 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 Equity 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 Trust 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 or 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
Page 29
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 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 when the value of the
Equity Securities owned by the Trust as shown by any evaluation, is less
than the lower of $2,000,000 or 20% of the total value of Equity
Securities deposited in such Trust during the initial offering period,
or 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
underwriters, including the Sponsor. If the Trust is liquidated because
of the redemption of unsold Units of the Trust by underwriters, the
Sponsor will refund to each purchaser of Units of the Trust the entire
sales charge and the transaction fees paid by such purchaser. 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
"Rights of Unit Holders-How are Income and Capital Distributed?"
Commencing during the period beginning nine business days prior to and
no later than the Mandatory Termination 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
holder at his address appearing on the registration books of the Trust
maintained by the Trustee. At least 60 days prior to the Maturity Date
of 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 1,000 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. 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 ten business days prior to the Mandatory Termination
Date of the Trust. Unit holders not electing a distribution of shares of
Equity Securities will receive a cash distribution from the sale of the
remaining Equity 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 Indenture, including estimated
compensation of the Trustee and costs of liquidation and any amounts
required as a reserve to provide for payment of any applicable taxes or
other governmental charges. Any sale of Equity 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. In addition, to
the extent that Equity Securities are sold prior to the Mandatory
Termination Date, Unit holders will not benefit from any stock
appreciation they would have received had the Equity Securities not been
sold 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.
Page 30
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.
Page 31
REPORT OF INDEPENDENT AUDITORS
The Sponsor, Nike Securities L.P., and Unit Holders
FT 293
We have audited the accompanying statement of net assets, including the
schedule of investments, of FT 293, comprised of Diversified Income &
Growth Trust, 1999 Winter Series, as of the opening of business on
December 28, 1998. 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 December 28,
1998. 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 FT 293,
comprised of Diversified Income & Growth Trust, 1999 Winter Series, at
the opening of business on December 28, 1998 in conformity with
generally accepted accounting principles.
ERNST & YOUNG LLP
Chicago, Illinois
December 28, 1998
Page 32
Statement of Net Assets
DIVERSIFIED INCOME & GROWTH TRUST, 1999 WINTER SERIES
FT 293
At the Opening of Business on the Initial Date of Deposit-December 28,
1998
<TABLE>
<CAPTION>
NET ASSETS
<S> <C>
Investment in Equity Securities represented by purchase contracts (1) (2) $148,461
Less accrued organizational and offering costs (3) (300)
Less liability for deferred sales charge (4) (3,449)
________
Net assets $144,712
========
Units outstanding 14,996
ANALYSIS OF NET ASSETS
Cost to investors (5) $149,961
Less sales charge (5) (4,949)
Less estimated organizational and offering costs (3) (300)
________
Net assets $144,712
========
<FN>
NOTES TO STATEMENT OF NET ASSETS
(1) Aggregate cost of the Equity Securities listed under "Schedule of
Investments" is based on their aggregate underlying value.
(2) An irrevocable letter of credit totaling $200,000 issued by The
Chase Manhattan Bank has been deposited with the Trustee as collateral,
which is sufficient to cover the monies necessary for the purchase of
the Equity Securities pursuant to contracts for the purchase of such
Equity Securities.
(3) A portion of the Public Offering Price on Units purchased prior to
the earlier of six months after the Initial Date of Deposit or the end
of the initial offering period consists of Equity Securities in an
amount sufficient to pay for all or a portion of the costs incurred in
establishing the Trust. These costs have been estimated at $.0200 per
Unit based upon the expected number of Units to be created. A
distribution will be made at the earlier of six months after the Initial
Date of Deposit or the end of the initial offering period to an account
maintained by the Trustee from which the organizational and offering
cost obligation of the investors to the Sponsor will be satisfied. To
the extent the number of Units issued is larger or smaller than the
estimate, the actual distribution per Unit at the end of the initial
offering period may differ from that set forth above.
(4) Represents the amount of mandatory distributions from the Trust
($.23 per Unit), payable to the Sponsor in five equal monthly
installments beginning on August 20, 1999, and on the twentieth day of
each month thereafter (or if such date is not a business day, on the
preceding business day), through December 20, 1999. If Units are
redeemed prior to December 20, 1999, the remaining amount of the
deferred sales charge applicable to such Units will be payable at the
time of redemption.
(5) The aggregate cost to investors includes a sales charge computed at
the rate of 3.3% of the Public Offering Price (equivalent to 3.333% of
the net amount invested, exclusive of the deferred sales charge),
assuming no reduction of sales charge as described under "Public
Offering-How is the Public Offering Price Determined?"
</FN>
</TABLE>
Page 33
Schedule of Investments
DIVERSIFIED INCOME & GROWTH TRUST, 1999 WINTER SERIES
FT 293
At the Opening of Business on the
Initial Date of Deposit-December 28, 1998
<TABLE>
<CAPTION>
Percentage Market Cost of
of Aggregate Value Equity
Number Ticker Symbol and Offering per Securities
of Shares Name of Issuer of Equity Securities (1) Price Share to Trust (2)
_________ _______________________________________ __________ _______ ____________
<C> <S> <C> <C> <C>
CAPITAL GOODS
104 EMR Emerson Electric Co. 4.33% $ 61.813 $ 6,429
64 GE General Electric Company 4.35% 100.938 6,460
COMMUNICATIONS/MEDIA
105 AIT Ameritech Corporation (3) 4.36% 61.625 6,471
112 BEL Bell Atlantic Corporation 4.36% 57.813 6,475
CONSUMER NON-DURABLES
157 DF Dean Foods Company 4.34% 41.000 6,437
271 FLO Flowers Industries, Inc. 4.35% 23.813 6,453
113 HNZ H.J. Heinz Company 4.36% 57.313 6,476
69 PG Procter & Gamble Company 4.36% 93.750 6,469
220 SLE Sara Lee Corporation 4.35% 29.375 6,462
ENERGY
110 AN Amoco Corporation (4) 4.35% 58.750 6,463
73 MOB Mobil Corporation (5) 4.36% 88.750 6,479
FINANCIAL-REITs
223 CPJ Chateau Communities, Inc. 4.35% 28.938 6,453
85 FNM Fannie Mae 4.35% 75.938 6,455
300 JDN JDN Realty Corporation 4.34% 21.500 6,450
299 NHP Nationwide Health Properties, Inc. 4.34% 21.563 6,447
HEALTHCARE
121 AHP American Home Products Corporation 4.36% 53.500 6,474
81 JNJ Johnson & Johnson 4.33% 79.313 6,424
43 MRK Merck & Co., Inc. 4.31% 148.813 6,399
118 SGP Schering-Plough Corporation 4.37% 54.938 6,483
RETAIL/APPAREL
106 MAY The May Department Stores Company 4.33% 60.688 6,433
UTILITY
205 AWK American Water Works Company, Inc. 4.35% 31.500 6,457
186 PNY Piedmont Natural Gas Company, Inc. 4.34% 34.625 6,440
177 SRP Sierra Pacific Resources (6) 4.36% 36.563 6,472
_____ ________
Total Investments 100% $148,461
===== ========
____________
<FN>
(1) All Equity Securities are represented by regular way contracts to
purchase such Equity Securities for the performance of which an
irrevocable letter of credit has been deposited with the Trustee. The
contracts to purchase Equity Securities were entered into by the Sponsor
on December 28, 1998.
(2) The cost of the Equity Securities to the Trust represents the
aggregate underlying value with respect to the Equity Securities
acquired (generally determined by the last 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 valuation of the Equity Securities has been determined by
the Evaluator, an affiliate of the Sponsor. The aggregate underlying
value of the Equity Securities on the Initial Date of Deposit was
$148,461. Cost and loss to Sponsor relating to the Equity Securities
sold to the Trust were $148,859 and $398, respectively.
Page 34
(3) SBC Communications, Inc. ("SBC") has recently announced plans to
acquire Ameritech Corporation ("Ameritech"). As per the terms of the
merger agreement, each shareholder of Ameritech will receive 1.316
shares of SBC for each share of Ameritech held. As a result of this
expected transaction, it is anticipated that the Trust will receive
shares of common stock of SBC in exchange for the shares of Ameritech
which it holds. The transaction is subject to the approval of the
shareholders of both companies and various regulatory authorities.
(4) British Petroleum Plc ("BP") has recently announced plans to acquire
Amoco Corporation ("Amoco"). As per the terms of the merger agreement,
each shareholder of Amoco will receive .6617 BP American Depositary
Receipts for each share of Amoco held. As a result of this expected
transaction, it is anticipated that the Trust will receive American
Depositary Receipts of BP in exchange for the shares of Amoco which it
holds. The transaction is subject to the approval of the shareholders of
both companies and various regulatory authorities.
(5) Exxon Corporation ("Exxon") has recently announced plans to acquire
Mobil Corporation ("Mobil"). As per the terms of the merger agreement,
each shareholder of Mobil will receive 1.32015 shares of Exxon for each
share of Mobil held. As a result of this expected transaction, it is
anticipated that the Trust will receive shares of common stock of Exxon
in exchange for the shares of Mobil which it holds. The transaction is
subject to the approval of the shareholders of both companies and
various regulatory authorities.
(6) Nevada Power Company ("Nevada Power") has recently announced plans to
acquire Sierra Pacific Resources ("Sierra Pacific"). As per the terms of
the merger agreement, the combined company will be named Sierra Pacific
Resources ("New Sierra Pacific") and each shareholder of Sierra Pacific
will receive 1.44 shares of New Sierra Pacific for each share of Sierra
Pacific held. As a result of this expected transaction, it is
anticipated that the Trust will receive shares of common stock of New
Sierra Pacific in exchange for the shares of Sierra Pacific which it
holds. The transaction is subject to the approval of the shareholders of
both companies and various regulatory authorities.
</FN>
</TABLE>
Page 35
CONTENTS:
Summary of Essential Information 4
Diversified Income & Growth Trust, 1999 Winter Series
FT 293:
What is the FT Series? 6
What are the Expenses and Charges? 9
What is the Federal Tax Status of Unit Holders? 10
Are Investments in the Trust Eligible for
Retirement Plans? 14
Portfolio:
What are the Equity Securities? 14
What are the Equity Securities Selected for the
Diversified Income & Growth Trust,
1999 Winter Series? 14
Risk Factors 16
What are Some Additional Considerations
for Investors? 18
Public Offering:
How is the Public Offering Price Determined? 19
How are Units Distributed? 21
What are the Sponsor's Profits? 23
Will There be a Secondary Market? 23
Rights of Unit Holders:
How is Evidence of Ownership Issued
and Transferred? 24
How are Income and Capital Distributed? 24
What Reports will Unit Holders Receive? 25
How May Units be Redeemed? 26
How May Units be Purchased by the Sponsor? 27
How May Equity Securities be Removed
from the Trust? 27
Information as to Sponsor, Trustee and Evaluator:
Who is the Sponsor? 28
Who is the Trustee? 28
Limitations on Liabilities of Sponsor and Trustee 29
Who is the Evaluator? 29
Other Information:
How May the Indenture be Amended or Terminated? 30
Legal Opinions 30
Experts 31
Report of Independent Auditors 32
Statement of Net Assets 33
Notes to Statement of Net Assets 33
Schedule of Investments 34
____________
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS NOT LAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO, WHICH THE FUND
HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940,
AND TO WHICH REFERENCE IS HEREBY MADE.
First trust (registered trademark)
DIVERSIFIED INCOME & GROWTH TRUST
1999 WINTER SERIES
Nike Securities L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
December 28, 1998
PLEASE RETAIN THIS PROSPECTUS
FOR FUTURE REFERENCE
Page 36
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 Prospectus
The signatures
Exhibits
S-1
SIGNATURES
The Registrant, FT 293, hereby identifies The First Trust
Special Situations Trust, Series 4 Great Lakes Growth and
Treasury Trust, Series 1; The First Trust Special Situations
Trust, Series 18 Wisconsin Growth and Treasury Securities Trust,
Series 1; The First Trust Special Situations Trust, Series 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, FT 293, has duly caused this Amendment to
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the Village of Lisle
and State of Illinois on December 28, 1998.
FT 293
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 Director of )
Nike Securities )
Corporation, the ) December 28, 1998
General Partner of )
Nike Securities L.P. )
)
)
David J. Allen Director of ) Robert M. Porcellino
Nike Securities ) Attorney-in-Fact**
Corporation, the )
General Partner of )
Nike Securities L.P.
* 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 December 28, 1998 in
Amendment No. 1 to the Registration Statement (Form S-6) (File
No. 333-63939) and related Prospectus of FT 293.
ERNST & YOUNG LLP
Chicago, Illinois
December 28, 1998
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 22 and
certain subsequent Series, effective November 20, 1991
among Nike Securities L.P., as Depositor, United States
Trust Company of New York as Trustee, Securities
Evaluation Service, Inc., as Evaluator, and First Trust
Advisors L.P. as Portfolio Supervisor (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
43693] filed on behalf of The First Trust Special
Situations Trust, Series 22).
1.1.1 Form of Trust Agreement for Series 293 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
FT 293
TRUST AGREEMENT
Dated: December 28, 1998
The Trust Agreement among Nike Securities L.P., as Depositor, The
Chase Manhattan Bank, as Trustee and First Trust Advisors L.P.,
as Evaluator and 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 22 and
certain subsequent Series, Effective November 20, 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 though said provisions had been set forth
in full in this instrument.
PART II
SPECIAL TERMS AND CONDITIONS OF TRUST
FOR DIVERSIFIED INCOME & GROWTH TRUST, 1999 WINTER SERIES
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 and the initial fractional
undivided interest in and ownership of the Trust represented by
each Unit thereof are set forth in the Prospectus in the section
"Summary of Essential Information."
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 on the Initial Date of Deposit is
as set forth in the Prospectus under "Schedule of Investments."
D. The Record Date shall be as set forth in the prospectus
for the sale of Units dated the date hereof (the "Prospectus")
under "Summary of Essential Information."
E. The Distribution Date shall be as set forth in the
Prospectus under "Summary of Essential Information."
F. The Mandatory Termination Date for the Trust shall be
as set forth in the Prospectus under "Summary of Essential
Information."
G. The Evaluator's compensation as referred to in
Section 4.03 of the Standard Terms and Conditions of Trust shall
be an annual fee as set forth in the Prospectus under "Summary of
Essential Information," calculated based on the largest number of
Units outstanding during the calendar year except during the
initial offering period as determined in Section 4.01 of this
Indenture, in which case the fee is calculated based on the
largest number of units outstanding during the period for which
the compensation is paid (such annual fee to be pro rated for any
calendar year in which the Evaluator provides services during
less than the whole of such year). 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.
H. The Trustee's Compensation Rate pursuant to
Section 6.04 of the Standard Terms and Conditions of Trust shall
be an annual fee as set forth in the Prospectus under "Summary of
Essential Information," calculated based on the largest number of
Units outstanding during the calendar year except during the
initial offering period as determined in Section 4.01 of this
Indenture, in which case the fee is calculated based on the
largest number of units outstanding during the period for which
the compensation is paid (such annual fee to be pro rated for any
calendar year in which the Trustee provides services during less
than the whole of such year). However, in no event, except as
may 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.
I. The Initial Date of Deposit for the Trust is December
28, 1998.
J. 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. Notwithstanding anything to the contrary in the
Standard Terms and Conditions of Trust, references to subsequent
Series established after the date of effectiveness of the First
Trust Special Situations Trust, Series 22 shall include FT 293.
B. The term "Principal Account" as set forth in the
Standard Terms and Conditions of Trust shall be replaced with the
term "Capital Account."
C. 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.
D. 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."
E. 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."
F. Section 1.01(29) shall be added to read as follows:
"(29) The term "Distribution Agent" shall refer to the
Trustee acting in its capacity as distribution agent
pursuant to Section 5.02 herein."
G. 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, and/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 within 20 days from the date of a
failure occurring within such initial 90-day period) shall
maintain exactly the Percentage Ratio existing immediately
prior to such deposit.
(5) In connection with and at the time of any deposit
of additional Securities pursuant to this Section 2.01(b),
the Depositor shall exactly replicate Cash (as defined
below) received or receivable by the Trust as of the date of
such deposit. For purposes of this paragraph, "Cash" means,
as to the Capital Account, cash or other property (other
than Securities) on hand in the Capital Account or
receivable and to be credited to the Capital Account as of
the date of the deposit (other than amounts to be
distributed solely to persons other than holders of Units
created by the deposit) and, as to the Income Account, cash
or other property (other than Securities) received by the
Trust as of the date of the deposit or receivable by the
Trust in respect of a record date for 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.
H. 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 for any
Letter(s) of Credit deposited with the Trustee in connection with
the deposits described in Section 2.01(a) and (b) 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."
I. Section 2.03(a) of the Standard Terms and Conditions of
Trust shall be amended by adding the following sentence after the
first sentence of such section:
"The number of Units may be increased through a split
of the Units or decreased through a reverse split thereof,
as directed in writing by the Depositor, at any time when
the Depositor is the only beneficial holder of Units, which
revised number of Units shall be recorded by the Trustee on
its books. The Trustee shall be entitled to rely on the
Depositor's direction as certification that no person other
than the Depositor has a beneficial interest in the Units
and the Trustee shall have no liability to any person for
action taken pursuant to such direction."
J. 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. Subject to reimbursement
as hereinafter provided, the cost of organizing the Trust
and the sale of the Trust Units shall be borne by the
Depositor, provided, however, that the liability on the part
of the Depositor under this section shall not include any
fees or other expenses incurred in connection with the
administration of the Trust subsequent to the deposit
referred to in Section 2.01. At the earlier of six months
after the Initial Date of Deposit or the conclusion of the
primary offering period (as certified by the Depositor to
the Trustee), the Trustee shall withdraw from the Account or
Accounts specified in the Prospectus or, if no Account is
therein specified, from the Capital Account, and pay to the
Depositor the Depositor's reimbursable expenses of
organizing the Trust and sale of the Trust Units in an
amount certified to the Trustee by the Depositor. If the
cash balance of the Capital Account is insufficient to make
such withdrawal, the Trustee shall, as directed by the
Depositor, sell Securities identified by the Depositor, or
distribute to the Depositor Securities having a value, as
determined under Section 4.01 as of the date of
distribution, sufficient for such reimbursement. The
reimbursement provided for in this section shall be for the
account of the Unit holders of record at the earlier of six
months after the Initial Date of Deposit or the conclusion
of the primary offering period. Any assets deposited with
the Trustee in respect of the expenses reimbursable under
this Section 3.01 shall be held and administered as assets
of the Trust for all purposes hereunder. The Depositor
shall deliver to the Trustee any cash identified in the
Statement of Net Assets of the Trust included in the
Prospectus not later than the expiration of the Delivery
Period and the Depositors obligation to make such delivery
shall be secured by the letter of credit deposited pursuant
to Section 2.01. Any cash which the Depositor has
identified as to be used for reimbursement of expenses
pursuant to this Section 3.01 shall be held by the Trustee,
without interest, and reserved for such purpose and,
accordingly, prior to the earlier of six months after the
Initial Date of Deposit or the conclusion of the primary
offering period, shall not be subject to distribution or,
unless the Depositor otherwise directs, used for payment of
redemptions in excess of the per Unit amount payable
pursuant to the next sentence. If a Unit holder redeems
Units prior to the earlier of six months after the Initial
Date of Deposit or the conclusion of the primary offering
period, the Trustee shall pay to the Unit holder, in
addition to the Redemption Value of the tendered Units,
unless otherwise directed by the Depositor, an amount equal
to the estimated per Unit cost of organizing the Trust and
the sale of Trust Units set forth in the Prospectus, or such
revision thereof most recently communicated to the Trustee
by the Depositor pursuant to Section 5.01, multiplied by the
number of Units tendered for redemption; to the extent the
cash on hand in the Trust is insufficient for such payment,
the Trustee shall have the power to sell Securities in
accordance with Section 5.02. The Trustee, upon receipt of
notification and certification from the Depositor of the
amount of any reimbursable expenses relating to the sale of
Trust Units incurred by the Depositor subsequent to the
earlier of six months after the Initial Date of Deposit or
the conclusion of the primary offering period, shall
withdraw from the Capital Account as set forth above, and
pay to the Depositor such amount. As used herein, the
Depositor's reimbursable expenses of organizing the Trust
and sale of the Trust Units shall include the cost of the
initial preparation and typesetting of the registration
statement, prospectuses (including preliminary
prospectuses), the indenture, and other documents relating
to the Trust, SEC and state blue sky registration fees, the
cost 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.
K. The second paragraph of Section 3.02 of the Standard
Terms and Conditions 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 a Trust) received by a Trust
shall be dealt with in the manner described at Section 3.11,
herein, and shall be retained or disposed of by such Trust
according to those provisions. The proceeds of any
disposition shall be credited to the Income Account of a
Trust. Neither the Trustee nor the Depositor shall be
liable or responsible in any way for depreciation or loss
incurred by reason of any such sale."
L. Section 3.05.II(a) of the Standard Terms and Conditions
of Trust is hereby amended to read in its entirety as follows:
"II. (a) 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 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, provided, however, that the
Trustee shall not be required to make a distribution from
the Capital 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) if provided
for in the Prospectus, 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 third
business day prior to the following Distribution Date,
and at such reduced sales charge as may be described in
the prospectus for the Trusts. 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."
M. Section 3.05.II(b) of the Standard Terms and Conditions
of Trust is hereby amended to read in its entirety as follows:
"II. (b) For purposes of this Section 3.05, the Unit
holder's Income Distribution shall be equal to such Unit
holder's pro rata share of the cash balance in the Income
Account computed as of the close of business on the Record
Date immediately preceding such Income Distribution after
deduction of (i) the fees and expenses then deductible
pursuant to Section 3.05.I. and (ii) the Trustee's estimate
of other expenses properly chargeable to the Income Account
pursuant to the Indenture which have accrued, as of such
Record Date, or are otherwise properly attributable to the
period to which such Income Distribution relates."
N. 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."
O. 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 Interest 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 3.14.
P. The following text shall be added immediately following
the last paragraph of Section 3.06 of the Standard Terms and
Conditions of Trust:
"If so directed by the Depositor, the Trustee shall mail to
each Unit holder of record on the relevant mailing date a
monthly, quarterly or semi-annual statement, as specified by the
Depositor, which shall set forth such information concerning the
Trust and shall be prepared by the Depositor. Once initiated,
the frequency of such statements may not be altered over the life
of the Trust."
Additional copies of each statement or report prepared
pursuant to this Section 3.06 shall be furnished to such brokers,
dealers, financial consultants or other persons as the Depositor
shall, by written instructions to the Trustee, direct. The
additional expense, if any, of furnishing such additional copies
shall constitute an expense of the Trust pursuant to Section
6.04.
Q. Section 3.11 of the Standard Terms and Conditions of
Trust is hereby deleted in its entirety and replaced with the
following language:
"Section 3.11. 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 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 Securities are voted as closely as
possible in the same manner and the same general proportion
as are the Securities held by owners other than such 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
issuance, exchange or substitution be effected
notwithstanding such rejection or without an initial offer,
any securities, cash and/or property received 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
Capital 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 3.11.
Whenever new securities or property is received and
retained by a Trust pursuant to this Section 3.11, the
Trustee shall provide to all Unit holders of such Trust
notices of such acquisition in the Trustee's annual report
unless prior notice is directed by the Depositor."
R. The first sentence of Section 3.13. 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 as set forth in the
Prospectus per Unit outstanding as of January 1 of such year
except for a Trust during the year or years in which an
initial offering period as determined in Section 4.01 of
this Indenture occurs, in which case the fee for a month is
based on the number of Units outstanding at the end of such
month (such annual fee to be pro rated for any calendar year
in which the Portfolio Supervisor provides services during
less than the whole of such year), but in no event shall
such compensation when combined with all compensation
received from other series of the Trust for providing such
supervisory services in any calendar year exceed the
aggregate cost to the Portfolio Supervisor for the cost of
providing such services."
S. Article III of the Standard Terms and Conditions of
Trust is hereby amended by inserting the following paragraphs
which shall be entitled Section 3.14.:
"Section 3.14. Bookkeeping and Administrative Expenses.
As compensation for providing bookkeeping and other
administrative services of a character described in Section
26(a)(2)(C) of the Investment Company Act of 1940 to the
extent such services are in addition to, and do not
duplicate, the services to be provided hereunder by the
Trustee or the Portfolio Supervisor, the Depositor shall
receive against a statement or statements therefor submitted
to the Trustee monthly or annually an aggregate annual fee
in an amount as set forth in the Prospectus times the number
of Units outstanding as of January 1 of such year except for
a year or years in which an initial offering period as
determined by Section 4.01 of this Indenture occurs, in
which case the fee for a month is based on the number of
Units outstanding at the end of such month (such annual fee
to be pro rated for any calendar year in which the Depositor
provides service during less than the whole of such year),
but in no event shall such compensation when combined with
all compensation received from other unit investment trusts
for which the Depositor hereunder is acting as Depositor for
providing such bookkeeping and administrative services in
any calendar year exceed the aggregate cost to the Depositor
providing services to such unit investment trusts. Such
compensation may, from time to time, be adjusted provided
that the total adjustment upward does not, at the time of
such adjustment, exceed the percentage of the total
increase, after the date hereof, in consumer prices for
services as measured by the United States Department of
Labor Consumer Price Index entitled "All Services Less Rent
of Shelter" or similar index, if such index should no longer
be published. The consent or concurrence of any Unit holder
hereunder shall not be required for any such adjustment or
increase. Such compensation shall be paid by the Trustee,
upon receipt of an invoice therefor from the Depositor, upon
which, as to the cost incurred by the Depositor of providing
services hereunder the Trustee may rely, and shall be
charged against the Income and Capital Accounts on or before
the Distribution Date following the 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 Capital Accounts
shall be insufficient to provide for amounts payable
pursuant to this Section 3.14, 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 3.14.
Any moneys payable to the Depositor pursuant to this
Section 3.14 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.
T. Article III of the Standard Terms and Conditions of
Trust is hereby amended by inserting the following paragraph
which shall be entitled Section 3.15:
"Section 3.15. Deferred Sales Charge. If the
prospectus related to the Trust specifies a deferred sales
charge, the Trustee shall, on the dates specified in and as
permitted by such Prospectus (the "Deferred Sales Charge
Payment Dates"), withdraw from the Capital Account, an
amount per Unit specified in such Prospectus and credit such
amount to a special non-Trust account designated by the
Depositor out of which the deferred sales charge will be
distributed to or on the order of the Depositor on such
Deferred Sales Charge Payment Dates (the "Deferred Sales
Charge Account"). If the balance in the Capital Account is
insufficient to make such withdrawal, the Trustee shall, as
directed by the Depositor, advance funds in an amount
required to fund the proposed withdrawal and be entitled to
reimbursement of such advance upon the deposit of additional
monies in the Capital Account, and/or sell Securities and
credit the proceeds thereof to the Deferred Sales Charge
Account, provided, however, that the aggregate amount
advanced by the Trustee at any time for payment of the
deferred sales charge shall not exceed $15,000. Such
direction shall, if the Trustee is directed to sell a
Security, identify the Security to be sold and include
instructions as to the execution of such sale. In the
absence of such direction by the Depositor, the Trustee
shall sell Securities sufficient to pay the deferred sales
charge (and any unreimbursed advance then outstanding) in
full, and shall select Securities to be sold in such manner
as will maintain (to the extent practicable) the relative
proportion of number of shares of each Security then held.
The proceeds of such sales, less any amounts paid to the
Trustee in reimbursement of its advances, shall be credited
to the Deferred Sales Charge Account. If a Unit holder
redeems Units prior to full payment of the deferred sales
charge, the Trustee shall, if so provided in the related
Prospectus, on the Redemption Date, withhold from the
Redemption Price payable to such Unit holder an amount equal
to the unpaid portion of the deferred sales charge and
distribute such amount to the Deferred Sales Charge Account.
If the Trust is terminated for reasons other than that set
forth in Section 6.01(g), the Trustee shall, if so provided
in the related Prospectus, on the termination of the Trust,
withhold from the proceeds payable to Unit holders an amount
equal to the unpaid portion of the deferred sales charge and
distribute such amount to the Deferred Sales Charge Account.
If the Trust is terminated pursuant to Section 6.01(g), the
Trustee shall not withhold from the proceeds payable to Unit
holders any amounts of unpaid deferred sales charges. If
pursuant to Section 5.02 hereof, the Depositor shall
purchase a Unit tendered for redemption prior to the payment
in full of the deferred sales charge due on the tendered
Unit, the Depositor shall pay to the Unit holder the amount
specified under Section 5.02 less the unpaid portion of the
deferred sales charge. All advances made by the Trustee
pursuant to this Section shall be secured by a lien on the
Trust prior to the interest of the Unit holders."
U. Notwithstanding anything to the contrary in Sections
3.15 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.
V. The first sentence of Section 4.03. shall be amended to
read as follows:
"As compensation for providing evaluation services under
this Indenture, the Evaluator shall receive, in arrears, against
a statement or statements therefor submitted to the Trustee
monthly or annually an aggregate annual fee equal to the amount
specified as compensation for the Evaluator in the Trust
Agreement per Unit outstanding as of January 1 of such year
except for a Trust during the year or years in which an initial
offering period as determined in Section 4.01 of this Indenture
occurs, in which case the fee is calculated based on the largest
number of Units outstanding during the period for which the
compensation is paid (such annual fee to be pro rated for any
calendar year in which the Evaluator provides services during
less than the whole of such year). 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 Evaluator, upon which, as to
the cost incurred by the Evaluator of providing services
hereunder the Trustee may rely, and shall be charged against the
Income and/or Principal Accounts, in accordance with Section
3.05."
W. Section 5.01 of the Standard Terms and Conditions of
Trust shall be amended as follows:
(i) The second sentence of the first paragraph of Section
5.01 shall be amended by deleting the phrase "and (iii)" and
adding the following "(iii) amounts representing unpaid accrued
organizational and offering costs, and (iv)" ; and
(ii) The following text shall immediately precede the last
sentence of the first paragraph of Section 5.01:
"Prior to the payment to the Depositor of its
reimbursable organizational and offering costs to be
made at the earlier of six months after the Initial
Date of Deposit or the conclusion of the primary
offering period in accordance with Section 3.01, for
purposes of determining the Trust Fund Evaluation under
this Section 5.01, the Trustee shall rely upon the
amounts representing unpaid accrued organizational and
offering costs in the estimated amount per Unit set
forth in the Prospectus until such time as the
Depositor notifies the Trustee in writing of a revised
estimated amount per Unit representing unpaid accrued
organizational and offering costs. Upon receipt of
such notice, the Trustee shall use this revised
estimated amount per Unit representing unpaid accrued
organizational and offering costs in determining the
Trust Fund Evaluation but such revision of the
estimated expenses shall not effect calculations made
prior thereto and no adjustment shall be made in
respect thereof. Reimbursable offering costs incurred
by the Depositor subsequent to the earlier of six
months after the Initial Date of Deposit or the
conclusion of the primary offering period shall be
accounted for as paid by the Trustee."
X. Section 5.02 of the Standard Terms and Conditions of
Trust is amended by adding the following after the second
paragraph of such section:
"Notwithstanding anything herein to the contrary, in
the event that any tender of Units pursuant to this Section
5.02 would result in the disposition by the Trustee of less
than a whole Security, the Trustee shall distribute cash in
lieu thereof and sell such Securities as directed by the
Sponsors as required to make such cash available.
Subject to the restrictions set forth in the
Prospectus, Unit holders may redeem 1,000 Units or more of a
Trust and request a distribution in kind of (i) such Unit
holder's pro rata portion of each of the Securities in such
Trust, in whole shares, and (ii) cash equal to such Unit
holder's pro rata portion of the Income and Capital Accounts
as follows: (x) a pro rata portion of the net proceeds of
sale of the Securities representing any fractional shares
included in such Unit holder's pro rata share of the
Securities and (y) such other cash as may properly be
included in such Unit holder's pro rata share of the sum of
the cash balances of the Income and Capital Accounts in an
amount equal to the Unit Value determined on the basis of a
Trust Fund Evaluation made in accordance with Section 5.01
determined by the Trustee on the date of tender less amounts
determined in clauses (i) and (ii)(x) of this Section.
Subject to Section 5.05 with respect to Rollover Unit
holders, if applicable, to the extent possible,
distributions of Securities pursuant to an in kind
redemption of Units shall be made by the Trustee through the
distribution of each of the Securities in book-entry form to
the account of the Unit holder's bank or broker-dealer at
the Depository Trust Company. Any distribution in kind will
be reduced by customary transfer and registration charges."
Y. Paragraph (g) of Section 6.01 of the Standard Terms and
Conditions of Trust is hereby amended by inserting the following
after the first word thereof:
"(i) the value of any Trust as shown by an evaluation
by the Trustee pursuant to Section 5.01 hereof shall be less
than the lower of $2,000,000 or 20% of the total value of
Securities deposited in such Trust during the initial
offering period, or (ii)"
Z. The following phrase shall be inserted immediately
after the phrase "including legal and auditing expenses," in the
first sentence of the second paragraph of Section 6.04.:
"expenses incurred in printing and mailing quarterly,
semi-annual or annual communications to Unit holders,"
AA. Section 8.02 of the Standard Terms and Conditions of
Trust shall be amended as follows:
(i) The fourth sentence of the second paragraph shall
be deleted and replaced with the following:
"The Trustee will honor duly executed requests for in-
kind distributions received (accompanied by the electing
Unit holder's Certificate, if issued) by the close of
business ten business days prior to the Mandatory
Termination Date."
(ii) The first sentence of the fourth paragraph shall
be deleted and replaced with the following:
"Commencing no earlier than the business day following
that date on which Unit holders must submit to the Trustee
notice of their request to receive an in-kind distribution
of Securities at termination, the Trustee will liquidate the
Securities not segregated for in-kind distributions during
such period and in such daily amounts as the Depositor shall
direct."
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
Senior Vice President
THE CHASE MANHATTAN BANK,
Trustee
By Rosalia A. Raviele
Vice President
[SEAL]
ATTEST:
Joan Currie
Assistant Treasurer
FIRST TRUST ADVISORS L.P.,
Evaluator
By Robert M. Porcellino
Senior Vice President
FIRST TRUST ADVISORS L.P.,
Portfolio Supervisor
By Robert M. Porcellino
Senior Vice President
SCHEDULE A TO TRUST AGREEMENT
Securities Initially Deposited
FT 293
(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
December 28, 1998
Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
Re: FT 293
Gentlemen:
We have served as counsel for Nike Securities L.P., as
Sponsor and Depositor of FT 293 in connection with the
preparation, execution and delivery of a Trust Agreement dated
December 28, 1998 among Nike Securities L.P., as Depositor, The
Chase Manhattan Bank, as Trustee and First Trust Advisors L.P. as
Evaluator and 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. 333-63939)
relating to the Units referred to above, to the use of our name
and to the reference to our firm in said Registration Statement
and in the related Prospectus.
Respectfully submitted,
CHAPMAN AND CUTLER
EFF:erg
CHAPMAN AND CUTLER
111 WEST MONROE STREET
CHICAGO, ILLINOIS 60603
December 28, 1998
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: FT 293
Gentlemen:
We have acted as counsel for Nike Securities L.P., Depositor
of FT 293 (the "Fund"), in connection with the issuance of units
of fractional undivided interest in the Trust of said Fund (the
"Trust"), under a Trust Agreement, dated December 28, 1998 (the
"Indenture"), among Nike Securities L.P., as Depositor, The Chase
Manhattan Bank, as Trustee, and First Trust Advisors L.P., as
Evaluator and 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 Equity Securities as such term is defined in the
Prospectus. For purposes of the following discussion and
opinion, it is assumed that each Equity Security is equity for
Federal income tax purposes and that each REIT share (as defined
herein) represents a share in an entity treated as a real estate
investment trust for federal income tax purposes.
Based upon the foregoing and upon an investigation of such
matters of law as we consider to be applicable, we are of the
opinion that, under existing United States 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 each of the
assets of the Trust under the Internal Revenue Code of 1986 (the
"Code") in the proportion that the number of Units held by him
bears to the total number of Units outstanding; under Subpart E,
Subchapter J of Chapter 1 of the Code, income of the Trust will
be treated as income of the Unit holders in the proportion
described above; 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 the Trustee. Each Unit holder will be considered to
have received his pro rata share of income derived from each
Trust asset when such income is considered to be received by the
Trust.
II. The price a Unit holder pays for his Units, generally
including sales charges, is allocated among his pro rata portion
of each Equity Security held by the Trust (in proportion to the
fair market values thereof on the valuation date closest to the
date the Unit holder purchases his Units) in order to determine
his tax basis for his pro rata portion of each Equity Security
held by the Trust. For Federal income tax purposes, a Unit
holder's pro rata portion of distributions of cash or property by
a corporation with respect to an Equity Security ("dividends" as
defined by Section 316 of the Code) 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 Equity Security, and to the extent
that such dividends exceed a Unit holder's tax basis in such
Equity Security, shall be treated as gain from the sale or
exchange of property. Certain of the issuers of the Equity
Securities intent to qualify under special Federal income tax
rules as "real estate investment trusts" (a "REIT," shares of
such issuer held by the Trust shall be referred to as the "REIT
Shares"). Because Unit holders are deemed to directly own a pro
rata portion of the REIT Shares as discussed above, Unit holders
are advised to consult their tax advisers for information
relating to the tax consequences of owning the REIT Shares.
Provided such issuer qualifies as a REIT, certain distributions
by such issuer on the REIT Shares may qualify as "capital gain
dividends," taxable to shareholders (and, accordingly, to the
Unit holders as owners of a pro rata portion of the REIT Shares)
as long-term capital gain, regardless of how long a shareholder
has owned such shares. In addition, distributions of income or
capital gains declared on REIT Shares in October, November, or
December will be deemed to have been paid to the shareholders
(and, accordingly, to the Unit holders as owners of a pro rata
portion of the REIT Shares) on December 31 of the year they are
declared, even when paid by the REIT during the following January
and received by shareholders or Unit holders in such following
year.
III. Gain or loss will be recognized to a Unit holder
(subject to various nonrecognition provisions under the Code)
upon redemption or sale of his Units, except to the extent an in
kind distribution of stock is received by such Unit holder from
the Trust as discussed below. Such gain or loss is measured by
comparing the proceeds of such redemption or sale with the
adjusted basis of his Units. Before adjustment, such basis would
normally be cost if the Unit holder had acquired his Units by
purchase. Such basis will be reduced, but not below zero, by the
Unit holder's pro rata portion of dividends with respect to each
Equity Security which is not taxable as ordinary income.
However, any loss realized by a Unit holder with respect to the
disposition of his pro rata portion of the REIT Shares, to the
extent such Unit holder has owned his Units for less than six
months or the Trust has held the REIT Shares for less than six
months, will be treated as long-term capital loss to the extent
of the Unit holder's pro rata portion of any capital gain
dividends received (or deemed to have been received) with respect
to the REIT Shares.
IV. If the Trustee disposes of a Trust asset (whether by
sale, exchange, liquidation, redemption, payment on maturity or
otherwise) gain or loss will be recognized to the Unit holder
(subject to various nonrecognition provisions under the Code) and
the amount thereof will be measured by comparing the Unit
holder's aliquot share of the total proceeds from the transaction
with his basis for his fractional interest in the asset disposed
of. Such basis is ascertained by apportioning the tax basis for
his Units (as of the date on which his Units were acquired) among
each of the Trust assets (as of the date on which his Units were
acquired) ratably according to their values as of the valuation
date nearest the date on which he purchased such Units. A Unit
holder's basis in his Units and of his fractional interest in
each Trust asset must be reduced, but not below zero, by the Unit
holder's pro rata portion of dividends with respect to each
Equity Security which is not taxable as ordinary income.
V. Under the Indenture, under certain circumstances, a
Unit holder tendering Units for redemption may request an in kind
distribution of Equity Securities upon the redemption of Units or
upon the termination of the Trust. As previously discussed,
prior to the redemption of Units or the termination of the Trust,
a Unit holder is considered as owning a pro rata portion of each
of the Trust's assets. The receipt of an in kind distribution
will result in a Unit holder receiving an undivided interest in
whole shares of stock and possibly cash. The potential federal
income tax consequences which may occur under an in kind
distribution with respect to each Equity Security owned by the
Trust will depend upon whether or not a Unit holder receives cash
in addition to Equity Securities. An "Equity Security" for this
purpose is a particular class of stock issued by a particular
corporation. 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 of 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. The total amount of taxable gains
(or losses) recognized upon such redemption will generally equal
the sum of the gain (or loss) recognized under the rules
described above by the redeeming Unit holder with respect to each
Equity Security owned by the Trust.
A domestic corporation owning Units in the Trust may be
eligible for the 70% dividends received deduction pursuant to
Section 243(a) of the Code with respect to such Unit holders' 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), subject to
the limitations imposed by Sections 246 and 246A of the Code.
However, dividends received on the REIT Shares are not eligible
for the dividends received deduction.
Section 67 of the Code provides that certain miscellaneous
itemized deductions, such as investment expenses, tax return
preparation fees and employee business expenses will be
deductible by an individual only to the extent they exceed 2% of
such individual's adjusted gross income. Unit holders may be
required to treat some or all of the expenses of the Trust as
miscellaneous itemized deductions subject to this limitation.
A Unit holder will recognize taxable gain (or loss)when all
or part of the pro rata interest in an Equity Security is either
sold by the Trust or redeemed or when a Unit holder disposes of
his Units in a taxable transaction, in each case for an amount
greater (or less) than his tax basis therefor; subject to various
nonrecognition provisions of the Code.
Any gain or loss recognized on a sale or exchange will,
under current law, generally be capital gain or loss.
The scope of this opinion is expressly limited to the
matters set forth herein, and, except as expressly set forth
above, we express no opinion with respect to any other taxes,
including foreign, state or local taxes or collateral tax
consequences with respect to the purchase, ownership and
disposition of Units.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement (File No. 333-63939)
relating to the Units referred to above and to the use of our
name and to the reference to our firm in said Registration
Statement and in the related Prospectus.
Very truly yours,
CHAPMAN AND CUTLER
EFF/erg
CARTER, LEDYARD & MILBURN
COUNSELLORS AT LAW
2 WALL STREET
NEW YORK, NEW YORK 10005
December 28, 1998
The Chase Manhattan Bank, as Trustee of
FT 293
4 New York Plaza, 6th Floor
New York, New York 10004-2413
Attention: Mr. Thomas Porrazzo
Vice President
Re: FT 293
Dear Sirs:
We are acting as special counsel with respect to New York
tax matters for the unit investment trust or trusts contained in
FT 293 (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 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.
We consent to the filing of this opinion as an exhibit to
the Registration Statement (No. 333-63939) filed with the
Securities and Exchange Commission with respect to the
registration of the sale of the Units and to the references to
our name under the captions "What is the Federal Tax Status of
Unit-holders?" and "Legal Opinions" in such Registration
Statement and the preliminary prospectus included therein.
Very truly yours,
CARTER, LEDYARD & MILBURN
CARTER, LEDYARD & MILBURN
COUNSELLORS AT LAW
2 WALL STREET
NEW YORK, NEW YORK 10005
December 28, 1998
The Chase Manhattan Bank, as Trustee of
FT 293
4 New York Plaza, 6th Floor
New York, New York 10004-2413
Attention: Mr. Thomas Porrazzo
Vice President
Re: FT 293
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 unit investment trust or trusts included in FT
293 (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 (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 todays 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.
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
December 28, 1998
Nike Securities L.P.
1001 Warrenville Road
Lisle, IL 60532
Re: FT 293
Gentlemen:
We have examined the Registration Statement File No.
333-63939 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
Senior Vice President
