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 305
B. Name of Depositor: NIKE SECURITIES L.P.
C. Complete Address of Depositor's 1001 Warrenville Road
Principal Executive Offices: Lisle, Illinois 60532
D. Name and Complete Address of
Agents for Service: NIKE SECURITIES L.P.
Attention: James A. Bowen
Suite 300
1001 Warrenville Road
Lisle, Illinois 60532
CHAPMAN & CUTLER
Attention: Eric F. Fess
111 West Monroe Street
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 the Public: ____ Check if it is
proposed that this filing
will become effective on
_____ at ____ p.m.
pursuant to Rule 487.
The registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective
date until the registrant shall file a further amendment which
specifically states that this Registration Statement shall
thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement
shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
SUBJECT TO COMPLETION, DATED JANUARY 7, 1999
10 Uncommon EuroValues, 1999 Portfolio
The Trust. FT 305 (10 Uncommon EuroValues, 1999 Portfolio) is a unit
investment trust consisting of shares of ten different common stocks of
companies headquartered in Europe (the "Equity Securities").
The objective of the Trust is to provide the potential for above-average
capital appreciation by investing the Trust's portfolio in the Equity
Securities. See "Schedule of Investments." The Trust has a mandatory
termination date (the "Mandatory Termination Date" or "Trust Ending
Date") of approximately thirteen months from the date of this Prospectus
as set forth under "Summary of Essential Information." There is, of
course, no guarantee that the objective of the Trust will be achieved.
Each Unit of the Trust represents an undivided fractional interest in
all the Equity Securities deposited in the Trust. 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 but may decline more than or not
increase as much as stocks in general. See "Portfolio."
The Sponsor may, from time to time after the Initial Date of Deposit,
deposit additional Equity Securities in the Trust 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 number of shares of 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 share relationship established
on the Initial Date of Deposit, and not the actual proportionate share
relationship on the subsequent Date of Deposit, because 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. Moreover, because of
fluctuations in the price of the Equity Securities, the proportionate
value relationship among the Equity Securities on any subsequent Date of
Deposit will probably be different from that established on the Initial
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
is equal to the aggregate underlying U.S. dollar 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 the Public Offering Price) and the maximum remaining deferred
sales charge (initially $___ per Unit). Commencing ______, 1999, and on
the ____________ day of each month thereafter (or if such day is not a
business day, on the preceding business day), through ______, 1999, a
deferred sales charge of $___ will be assessed per Unit per month. Units
purchased subsequent to the initial deferred sales charge payment will
be subject to the initial sales charge and the remaining deferred sales
charge payments. The deferred sales charge will be paid from funds in
the Capital Account, if sufficient, or from the periodic sale of Equity
Securities. The
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.
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD
NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION
STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN
OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE
ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER,
SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR
QUALIFICATION UNDER THE SECURITIES LAWS OF ANY STATE.
First Trust (registered trademark)
1-800-621-9533
The date of this Prospectus is ____________, 1999
Page 1
total maximum sales charge assessed to Unit holders on a per Unit basis
will be % of the Public Offering Price (equivalent to % 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 during 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. The minimum amount which an investor may
purchase in the Trust is $1,000 ($500 for Individual Retirement Accounts
or other retirement plans). Only whole Units may be purchased. The sales
charge for the Trust 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.
Dividend and Capital Distributions. Cash dividends received by the Trust
will be paid to Unit holders as part of the final liquidation
distribution. Distributions of funds in the Capital Account, if any,
will be made as part of the final liquidation distribution, and in
certain circumstances, earlier. Any distribution of income and/or
capital will be net of expenses of the Trust. See "What is the Federal
Tax Status of Unit Holders?" Additionally, upon termination of the
Trust, the Trustee will distribute, upon surrender of Units, to each
remaining Unit holder (other than a Rollover Unit holder as defined
below) his or her 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?" For distributions to Rollover Unit holders, see
"Rights of Unit Holders-Special Redemption, Liquidation and Investment
in a New Trust."
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 U.S. dollar value of 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 still redeem his or her
Units through the Trustee. Units sold or tendered for redemption prior
to such time as the entire deferred sales charge on such Units has been
collected will be assessed the amount of the remaining deferred sales
charge at the time of sale or redemption. See "Public Offering-Will
There be a Secondary Market?" and "Rights of Unit Holders-How May Units
be Redeemed?"
Special Redemption, Liquidation and Investment in a New Trust. The
Sponsor intends to create a separate 2000 series of the Lehman Brothers
10 Uncommon EuroValues (the "2000 Trust") in conjunction with the
termination of this series of the Trust. The portfolio of the 2000 Trust
will contain equity securities of companies which the Sponsor believes
have the potential to provide above-average capital appreciation during
the term of the 2000 Trust. Unit holders who wish to have the proceeds
from their Units invested in the 2000 Trust must specify by _____, 1999
(the "Rollover Notification Date") their intention to become "Rollover
Unit holders." Rollover Unit holders' Units will be redeemed in-kind on
the Rollover Notification Date and the distributed Equity Securities
sold by the Trustee, in its capacity as Distribution Agent, during the
Special Redemption and Liquidation Period. The proceeds of the
redemption will then be invested in Units of the 2000 Trust, at a
reduced sales charge, if such Trust is offered. Units purchased other
than with redemption proceeds will be subject to the full sales charge.
The Sponsor may stop creating new Units of the 2000 Trust at any time in
its sole discretion without regard to whether all the proceeds to be
invested have been invested. Cash which has not been invested on behalf
of the Rollover Unit holders in the 2000 Trust will be distributed at
the end of the Special Redemption and Liquidation Period. The Sponsor,
however, anticipates that sufficient Units can be created, although
moneys in the Trust may not be fully invested on the next business day.
Rollover Unit holders will receive credit for the amount of dividends in
the Income Account of the Trust which will be included in the
reinvestment in Units of the 2000 Trust. The exchange option described
above is subject to modification, termination or suspension.
Termination. The Trust will terminate approximately thirteen months
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 thereof to all Unit holders
Page 2
which will specify when certificates may be surrendered. Unit holders
not electing the "Rollover Option" or a distribution of shares of the
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
applicable stock market (many of which have recently experienced
substantial volatility and significant declines), governmental,
political, economic and fiscal policies of the representative countries,
changes in interest rates, economic recession, the lack of adequate
financial information concerning an issuer and exchange control
restrictions impacting foreign issuers. An investment in the Trust will
also be subject to the risks of currency fluctuations associated with
investments in foreign Equity Securities trading in non-U.S. currencies.
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.
Finally, the results of ownership of Units will differ from the results
of ownership of the underlying Equity Securities of the Trust for
various reasons, including the timing of the purchase and sale (or
redemption) of Units of the Trust, sales charges and expenses of the
Trust and taxes. The Trust is not designed to be a complete investment
program for an investor. See "What are Some Additional Considerations
for Investors?-Risk Factors."
Page 3
Summary of Essential Information
At the Opening of Business on the Initial Date of Deposit
of the Equity Securities-____________, 1999
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)
Fractional Undivided Interest in the Trust per Unit (1) 1/
Public Offering Price:
Aggregate Offering Price Evaluation of Equity Securities in Portfolio (2) $
Aggregate Offering Price Evaluation of Equity Securities per Unit $
Maximum Sales Charge % of the Public Offering Price per Unit
( % of the net amount invested, exclusive of the deferred sales charge) (3) $
Less Deferred Sales Charge per Unit $( )
Public Offering Price per Unit (3) $
Sponsor's Initial Repurchase Price per Unit (4) $
Redemption Price per Unit (based on aggregate underlying
U.S. dollar value of Equity Securities less the deferred sales charge) (4) $
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
Cash CUSIP Number
Reinvestment CUSIP Number
Security Code
First Settlement Date _____, 1999
Rollover Notification Date _____, 1999
Special Redemption and Liquidation Period During the period from _____, 1999 to _____, 1999.
Mandatory Termination Date February 21, 2000
Discretionary Liquidation Amount The Trust may be terminated if the value of the Equity Securities
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 $ per Unit outstanding.
Evaluator's Annual Fee (5) $ per Unit outstanding.
Portfolio Supervisor's Annual Fee (6) $ per Unit outstanding.
Estimated Organizational and Offering Costs (7) $_____ per Unit.
Income Distribution Record Date _____, 1999
Income Distribution Date (8) _____, 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
on the relevant stock exchange on the business day prior to the Initial
Date of Deposit, or if no such price exists or if the Equity Security is
not so listed, at the closing ask price thereof. The aggregate value of
the Equity Securities trading in non-U.S. currencies represents the U.S.
dollar value, based on the offering side value of the currency exchange
rate for the currency in which an Equity Security is generally
denominated at the Evaluation Time on the business day prior to the
Initial Date of Deposit.
(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 Evaluation
Time on the United States business day prior to 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) 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 (the "Evaluation Time") on each day on
which it is open.
(6) The Portfolio Supervisor's Annual Fee is payable to an affiliate of
the Sponsor. In addition, the Sponsor will be reimbursed for bookkeeping
and other administrative expenses currently at a maximum annual rate of
$.0015 per Unit.
(7) 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."
(8) If the 2000 Trust is offered, at the Rollover Notification Date for
Rollover Unit holders or upon termination of the Trust for other Unit
holders, amounts in the Income Account (which consist of dividends on
the Equity Securities) will be included in amounts distributed to or on
behalf of Unit holders. 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 as
part of the final liquidation distribution.
</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 only approximately 13 months and is a unit investment
trust rather than a mutual fund, this information is presented to permit
a comparison of fees, assuming the principal amount and distributions
are rolled over each year into a New Trust subject only to the deferred
sales charge.
<TABLE>
<CAPTION>
Amount
per Unit
________
<S> <C> <C>
Unit holder Transaction Expenses
Initial sales charge imposed on purchase
(as a percentage of the Public Offering Price) %(a) $
Deferred sales charge
(as a percentage of Public Offering Price) %(b)
_______ _______
% $
======= =======
Organizational and Offering Costs
Estimated Organizational and Offering Costs
(as a percentage of Public Offering Price) %(c) $
======= =======
Estimated Annual Trust Operating Expenses
(as a percentage of average net assets)
Trustee's fee, portfolio supervision, bookkeeping, administrative
and evaluation fees % $
Other operating expenses %
_______ _______
Total % $
======= =======
</TABLE>
<TABLE>
<CAPTION>
Example
_______
Cumulative Expenses Paid for Period:
1 Year 3 Years 5 Years 10 Years
______ _______ _______ ________
<S> <C> <C> <C> <C>
An investor would pay the following expenses on a $1,000
investment, assuming the 10 Uncommon EuroValues, 1999 Portfolio
estimated operating expense ratio of % and a 5% annual return on
the investment throughout the periods $ $ $ $
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 % and the maximum remaining deferred
sales charge (initially $___ per Unit) and would exceed % if the
Public Offering Price exceeds $10.00 per Unit.
(b) The actual fee is $___ per Unit per month, irrespective of purchase
or redemption price deducted in each of the ten months during the period
from ______, 1999 to ______, 1999. If the Unit price exceeds $10.00 per
Unit, the deferred sales charge will be less than %. If the Unit
price is less than $10.00 per Unit, the deferred sales charge will
exceed %. Units purchased subsequent to the initial deferred sales
charge payment will be subject to only the initial sales charge and the
remaining deferred sales charge payments.
(c)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). 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
10 UNCOMMON EUROVALUES, 1999 PORTFOLIO
FT 305
What is the FT Series?
FT 305 (10 Uncommon EuroValues, 1999 Portfolio) is one of a series of
investment companies created by the Sponsor under the name of the FT
Series, all of which are generally similar but each of which is separate
and is designated by a different series number (the "Trust"). The FT
Series was previously known as The First Trust Special Situations Trust
Series. The Trust is a unit investment trust 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 common stocks (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
securities or contracts to purchase securities in the Trust, the Trustee
delivered to the Sponsor documents evidencing the entire ownership of
the Trust.
The objective of the Trust is to provide the potential for above-average
capital appreciation by investing the Trust's portfolio in the common
stock of the ten companies that comprise the "10 Uncommon EuroValues"
portfolio for 1999. The "10 Uncommon EuroValues" is an annual
compilation of the ten common stocks selected by the Investment Policy
Committee of Lehman Brothers Inc. ("Lehman Brothers") with the
assistance of the Research Department of Lehman Brothers which, in the
opinion of Lehman Brothers, have the greatest potential for capital
appreciation during the next year. It is anticipated, although no
assurances are made, that Lehman Brothers will select the 10 Uncommon
EuroValues in subsequent years. This selection was based upon a
determination by Lehman Brothers that the selected stocks are deemed to
have an above-average appreciation potential as compared to the FT/S&P
World Indices-Europe Index (the "FT/S&P Europe Index") over the 12
months following the selection of the 10 Uncommon EuroValues stocks.
"FT/S&P Actuaries" is a joint trademark of Financial Times Limited and
Standard & Poor's. Neither the Financial Times Limited nor Standard &
Poor's are affiliated with the Sponsor and have not participated in the
creation of the Trust or the selection of the Equity Securities included
therein. Lehman Brothers believes that its intensive screening process
will yield a strong performance for the 10 Uncommon EuroValues.
On January 1, 1999, eleven of the fifteen member countries of the
European Union are scheduled to establish fixed conversion rates between
their existing sovereign currencies and the euro. Many banks, investment
firms and corporations are choosing to change their in-house bookkeeping
to euros as of January 1, 1999. Although not mandatory, this change is
occurring in large part as a result of markets, depositories and
clearing agents promoting the use of the euro, even if the underlying
product has not been redenominated. It is expected that companies
transacting business in euros will need less protection from changes in
exchange rates and will perform fewer currency transactions, which
should result in cost savings. The conversion to the euro has increased
the appetite for cross-border mergers and acquisitions, resulting in a
propensity for corporate restructuring.
The conversion of currencies has forced interest rates to fall and
converge, which has ignited economic growth across Europe. The European
Union is expected to have an economy almost as big as that of the United
States, with a projected combined annual output of $6.28 trillion,
compared to $8.1 trillion for the United States. In fact, "Euroland" is
expected to be the world's biggest single exporter and importer.
Additionally, the conversion has brought together a $2 trillion
government bond market, virtually equal to the market for U.S. Treasury
securities. With Europe's combined population exceeding 290 million,
pension fund assets are expected to swell as the trend toward saving for
retirement accelerates.
Lehman Brothers is one of the leading global investment banks serving
institutional, corporate, government and high net worth individual
clients and customers. Lehman Brothers' business includes capital
raising for clients through securities underwriting and direct
placements; corporate finance and strategic advisory services; merchant
banking; securities sales and trading; research; and the trading of
foreign exchange, derivative products and certain commodities. The Trust
Page 6
is not sponsored, or created by Lehman Brothers. Lehman Brothers' only
relationship to the Sponsor is the licensing of certain trademarks and
tradenames of Lehman Brothers and of the "10 Uncommon EuroValues" and
the sale to the Sponsor of research which is determined, composed and
calculated by Lehman Brothers without regard to the Sponsor or the
Trust. In addition, Lehman Brothers may sell Units of the Trust in its
capacity as Placement Agent. Lehman Brothers also receives fees for
brokerage services provided to this Trust and other trusts sponsored by
Nike Securities L.P. Lehman Brothers, 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. In
addition, Lehman Brothers may have acted as underwriter, manager or co-
manager of a public offering of the Equity Securities in this Trust
during the last three years. There is, of course, no guarantee that the
objective of the Trust will be achieved. See "Schedule of Investments"
and "What are Some Additional Considerations for Investors?-Risk Factors."
With the deposit of the Equity Securities on the Initial Date of
Deposit, the Sponsor established a percentage relationship between the
number of shares of Equity Securities in the Trust's portfolio. See
"Portfolio-What are the Equity Securities Selected for the 10 Uncommon
EuroValues, 1999 Portfolio?" From time to time following the Initial
Date of Deposit, the Sponsor, pursuant to the Indenture, may deposit
additional Equity Securities in the Trust or cash (including a letter of
credit) with instructions to purchase additional Equity Securities in
the Trust, and Units may be continuously offered for sale to the public
by means of this Prospectus, resulting in a potential increase in the
outstanding number of Units of the Trust. Any deposit by the Sponsor of
additional Equity Securities or cash will duplicate, as nearly as is
practicable, the original proportionate share relationship and not the
actual proportionate share 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. 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 deposited in the
Trust 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 be
increased proportionately. 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 undivided fractional interest represented by each outstanding
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 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.
Page 7
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 Lehman Brothers
Inc. or other dealers of the Trust.
First Trust Advisors L.P., in its capacity as the Evaluator for the
Trust, will receive an annual evaluation fee as set forth under "Summary
of Essential Information" for providing evaluation 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 largest number of Units in the Trust outstanding during the
period for which the 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 the
"Summary of Essential Information." Such fee will be based upon 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 the 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 fees described above are payable from the Income Account of the
Trust to the extent funds are available and then from the Capital
Account of the Trust. Since the Trustee has the use of the funds being
held in the Capital and Income Accounts for payment of expenses and
redemptions and since such Accounts are 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 or its affiliate
of supplying such services in such year.
The following additional charges are or may be incurred by the Trust:
all legal expenses of the Trustee incurred by or in connection with its
responsibilities under the Indenture; the expenses and costs of any
action undertaken by the Trustee to protect 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 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, if any, 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 and may tend to reduce
gains or increase the losses which are ultimately received by the Unit
holders from investing in the Trust. See "What is the Federal Tax Status
of Unit Holders?"
Page 8
What is the Federal Tax Status of Unit Holders?
The following is a general discussion of certain of the Federal income
tax consequences of the purchase, ownership and disposition of the
Units. The summary is limited to investors who hold the Units as
"capital assets" (generally, property held for investment) within the
meaning of Section 1221 of the Internal Revenue Code of 1986, as amended
(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 opinions, it is assumed that
each Equity Security is equity for federal income tax purposes.
In the opinion of Chapman and Cutler, special counsel for the Sponsor,
under existing law:
1. The Trust is not an association taxable as a corporation for
Federal income tax purposes; each Unit holder will be treated as the
owner of a pro rata portion of the assets of the Trust under the Code;
and the income of the Trust will be treated as income of the Unit
holders thereof under the Code. Each Unit holder will be considered to
have received his or her 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 considered to be 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. The price a Unit holder pays for his or her Units,
generally including sales charges, is allocated among his or her pro
rata portion of each Equity Security held by the Trust (in proportion to
the fair market values thereof on the valuation date nearest the date
the Unit holder purchases his or her Units) in order to determine his or
her tax basis for his or her pro rata portion of each Equity Security
held by the Trust. Unit holders should consult their own tax advisors
with regard to the calculation of basis. For Federal income tax
purposes, a Unit holder's pro rata portion of dividends, as defined by
Section 316 of the Code, paid by a corporation with respect to an Equity
Security held by the Trust is taxable as ordinary income to the extent
of such corporation's current and accumulated "earnings and profits." A
Unit holder's pro rata portion of dividends paid on such Equity Security
which exceeds such current and accumulated earnings and profits will
first reduce a Unit holder's tax basis in such 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.
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 gains and losses for Federal income tax purposes. In
particular, a Rollover Unit holder should be aware that a Rollover Unit
holder's loss, if any, incurred in connection with the exchange of Units
for Units in the next new series of the Trust (the "2000 Trust"), will
generally be disallowed with respect to the disposition of any Equity
Securities pursuant to such exchange to the extent that such Unit holder
is considered the owner of substantially identical securities under the
wash sale provisions of the Code taking into account such Unit holder's
deemed ownership of the securities underlying the Units in a New Trust
in the manner described above, if such substantially identical
securities are acquired within a period beginning 30 days before and
ending 30 days after such disposition. However, any gains incurred in
connection with such an exchange by a Rollover Unit holder would be
recognized. Unit holders should consult their tax advisors regarding the
recognition of gains and losses for Federal income tax purposes.
Page 9
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
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
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 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.
To the extent dividends received by the Trust are attributable to
foreign corporations, a corporation that owns Units will not be entitled
to the dividends received deduction with respect to its pro rata portion
of such dividends, since the dividends received deduction is generally
available only with respect to dividends paid by domestic corporations.
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.
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 Trust Expenses by Unit Holders. Each
Unit holder's pro rata share of each expense paid by the Trust is
deductible by the Unit holder to the same extent as though the expense
had been paid directly by him or her. It should be noted that as a
result of the Tax Reform Act of 1986, certain miscellaneous itemized
deductions, such as investment expenses, tax return preparation fees and
employee business expenses will be deductible by an individual only to
the extent they exceed 2% of such individual's adjusted gross income.
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 Equity
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
(although losses incurred by Rollover Unit holders may be subject to
disallowance, as discussed above). 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 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 for 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.
Page 10
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 Taxpayer Relief Act of 1997 (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 Investment in a
New Trust. As discussed in "Rights of Unit Holders-Special Redemption,
Liquidation and Investment in a New Trust," a Unit holder may elect to
become a Rollover Unit holder. To the extent a Rollover Unit holder
exchanges his or her Units for Units of a New Trust in a taxable
transaction, such Unit holder will recognize gains, if any, but
generally will not be entitled to a deduction for any losses recognized
upon the disposition of any Equity Securities pursuant to such exchange
to the extent that such Unit holder is considered the owner of
substantially identical securities under the wash sale provisions of the
Code taking into account such Unit holder's deemed ownership of the
securities underlying the Units in such New Trust in the manner
described above, if such substantially identical securities were
acquired within a period beginning 30 days before and ending 30 days
after such disposition under the wash sale provisions contained in
Section 1091 of the Code. In the event a loss is disallowed under the
wash sale provisions, special rules contained in Section 1091(d) of the
Code apply to determine the Unit holder's tax basis in the securities
acquired. Rollover Unit holders are advised to consult their tax advisors.
Computation of the Unit Holder's Tax Basis. Initially, a Unit holder's
tax basis in his or her Units will generally equal the price paid by
such Unit holder for his or her 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 to the date the Units are purchased in
order to determine such Unit holder's tax basis for his or her pro rata
portion of each Equity Security.
A Unit holder's tax basis in his or her Units and his or her 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
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 United States source income, if any) will generally be
subject to United States income taxation and withholding in the case of
Units held by non-resident alien individuals, foreign corporations or
other non-United States persons. Such persons should consult their tax
advisors.
In general, income that is not effectively connected to the conduct of a
trade or business within the United States that is earned by non-U.S.
Unit holders and derived from dividends of foreign corporations will not
be subject to U.S. withholding tax provided that less than 25 percent of
the gross income of the foreign corporation for a three-year period
ending with the close of its taxable year preceding payment was not
effectively connected to the conduct of a trade or business within the
United States. In addition, such earnings may be exempt from U.S.
withholding pursuant to a specific treaty between the United States and
a foreign country. Non-U.S. Unit holders should consult their own tax
advisors regarding the imposition of U.S. withholding on distributions
from the Trust.
It should be noted that payments to the Trust of dividends on Equity
Securities that are attributable to foreign corporations may be subject
to foreign withholding taxes and Unit holders should consult their tax
advisors regarding the potential tax consequences relating to the
payment of any such withholding taxes by the Trust. Any dividends
Page 11
withheld as a result thereof will nevertheless be treated as income to
the Unit holders. Because, under the grantor trust rules, an investor is
deemed to have paid directly his or her share of foreign taxes that have
been paid or accrued, if any, an investor may be entitled to a foreign
tax credit or deduction for United States income tax purposes with
respect to such taxes. The 1997 Act imposes a required holding period
for such credits. Investors should consult their tax advisors with
respect to foreign withholding taxes and foreign tax credits.
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 or 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 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 U.S. Unit
holders ("U.S. Unit holders") with regard to United States federal and
certain aspects of New York State and City income taxes. Unit holders
may be subject to taxation in New York or in other jurisdictions and
should consult their own tax advisors in this regard. 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.
Are Investments in the Trust Eligible for Retirement Plans?
Units of the Trust are eligible for purchase by Individual Retirement
Accounts, Keogh Plans, pension funds and other tax-deferred retirement
plans. Generally, the Federal income tax relating to capital gains and
income received in each of the foregoing plans is deferred until
distributions are received. Distributions from such plans are generally
treated as ordinary income but may, in some cases, be eligible for
special averaging or tax-deferred rollover treatment. Investors
considering participation in any such plan should review specific tax
laws related thereto and should consult their attorneys or tax advisers
with respect to the establishment and maintenance of any such plan. Such
plans are offered by brokerage firms and other financial institutions.
Fees and charges with respect to such plans may vary. Accordingly,
investors considering investing through a retirement plan should
consider doing so with funds already in such plan.
PORTFOLIO
What are the Equity Securities?
The Trust consists of different issues of Equity Securities which are
listed on a securities exchange and may include American Depositary
Receipts ("ADRs") or American Depositary Shares ("ADSs") that are listed
on the New York Stock Exchange. See "Portfolio-What are the Equity
Securities Selected for the 10 Uncommon EuroValues, 1999 Portfolio?" for
a general description of the companies. The Equity Securities selected
for the Trust are those common stocks which comprise the "10 Uncommon
EuroValues" as selected by Lehman Brothers. The stocks included in the
"10 Uncommon EuroValues" have been selected by Lehman Brothers'
Investment Policy Committee with the assistance of the Research
Department of Lehman Brothers. Lehman Brothers has selected the "10
Uncommon EuroValues" using the same methodology it has in the past in
selecting the U.S. 10 Uncommon Values. Lehman Brothers' Research
Page 12
Department currently follows approximately 325 companies headquartered
in Europe. Months before the Investment Policy Committee makes the final
determination for the annual "10 Uncommon EuroValues" portfolio, Lehman
Brothers' equity analysts begin recommending stocks to the Investment
Policy Committee that they believe will provide greater appreciation
potential than the FT/S&P Europe Index during the 12 months following
the portfolio selection. These stocks were selected based on an
examination of the fundamentals for each company. In making its final
decision, the Investment Policy Committee conducted extensive economic
analyses and considered investment strategies, global economic trends,
social and political developments and special regional factors
identified by Lehman Brothers' economists and strategists in order to
select the ten stocks with the greatest potential for above-average
capital appreciation.
What are the Equity Securities Selected for the 10 Uncommon EuroValues,
1999 Portfolio?
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. An investment in Units of the 10 Uncommon EuroValues Trust
should be made with an understanding of the risks such an investment may
entail. In general, the Trust will invest in, but is not limited to,
large-cap stocks. However, some of the common stocks selected to be "10
Uncommon EuroValues" may be small-cap company stocks. While historically
small-cap company stocks have outperformed the stocks of large
companies, the former have customarily involved more investment risk as
well. Small-cap company stocks may have limited product lines, markets
or financial resources; may lack management depth or experience; and may
be more vulnerable to adverse general market or economic developments
than large companies. Some of the companies in which the 10 Uncommon
EuroValues Trust may invest may distribute, sell or produce products
which have recently been brought to market and may be dependent on key
personnel.
The prices of small company securities are often more volatile than
prices associated with large company issues, and can display abrupt or
erratic movements at times, due to limited trading volumes and less
publicly available information. Also, because small cap companies
normally have fewer shares outstanding and these shares trade less
frequently than large companies, it may be more difficult for the 10
Uncommon EuroValues Trust to buy and sell significant amounts of such
shares without an unfavorable impact on prevailing market prices.
Because certain of the Equity Securities from time to time may be sold
under certain circumstances described herein, and because the proceeds
from such events will be distributed to Unit holders and will not be
reinvested, no assurance can be given that the Trust will retain for any
length of time its present size and composition. Although the Portfolio
is not managed, the Sponsor may instruct the Trustee to sell Equity
Securities under certain limited circumstances. Pursuant to the
Indenture and with limited exceptions, the Trustee may sell any
securities or other property acquired in exchange for Equity Securities
such as those acquired in connection with a merger or other transaction.
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. In fact, no Equity Security will be sold
prior to termination of the Trust (except to satisfy redemption requests
or to pay expenses and in certain other limited circumstances) even if
the Sponsor or Lehman Brothers comes to believe that such Equity
Security no longer has the potential for capital appreciation, or issues
a "sell" recommendation with respect to such Equity Security.
Page 13
Whether or not the Equity Securities are listed on a 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.
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. Against a backdrop of
continued uncertainty regarding the current global currency crises,
falling commodity prices and certain of the factors described above,
both the U.S. and a majority of foreign markets have experienced
substantial volatility and significant declines recently. For instance,
during the period between July 31, 1998 and September 30, 1998, the MSCI
Europe Index declined 16.02%. The Sponsor cannot predict the direction
or scope of any of these factors. Shareholders of common stocks 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. Moreover, common
stocks do not represent an obligations of the issuer and therefore do
not offer any assurance of income or provide the degree of protection of
capital provided by debt securities.
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.
Foreign Issuers. Since the Equity Securities included in the Trust
consist of common stocks of foreign issuers, an investment in the Trust
involves certain investment risks that are different in some respects
from an investment in a trust which invests entirely in common stocks of
domestic issuers. These investment risks include the possible imposition
of future political or governmental restrictions which might adversely
affect the payment or receipt of dividends on the relevant Equity
Securities, the possibility that the financial condition of the issuers
of the Equity Securities may become impaired or that the general
condition of the relevant stock market may deteriorate, the limited
liquidity and relatively small market capitalization of the relevant
securities market, the imposition of expropriation or confiscatory
taxation, economic uncertainties, the lack of the quantity and quality
of publicly available information concerning the foreign issuers as such
issuers are generally not subject to the same reporting and accounting
requirements as domestic issuers, and the effect of foreign currency
devaluations and fluctuations on the value of the common stocks and
dividends of foreign issuers in terms of U.S. dollars. In addition,
fixed brokerage commissions and other custody and transaction costs on
foreign securities exchanges are generally higher than in the United
States and there is generally less government supervision and regulation
of exchanges, brokers and issuers in foreign countries than there is in
the United States.
On the basis of the best information available to the Sponsor at the
present time, none of the Equity Securities in the Trust are subject to
exchange control restrictions under existing law which would materially
interfere with payment to the Trust of dividends due on, or proceeds
from the sale of, the Equity Securities. The adoption of such
restrictions or other legal restrictions could adversely impact the
marketability of the Equity Securities and may impair the ability of the
Trust to satisfy its obligation to redeem Units or could cause delays or
increase the costs associated with the purchase and sale of the Equity
Securities and correspondingly affect the price of the Units.
Page 14
The purchase and sale of the Equity Securities in the Trust will
generally be effected only in foreign securities markets. Although the
Sponsor does not believe that the Trust will encounter obstacles in
acquiring or disposing of the Equity Securities, investors should be
aware that in certain situations it may not be possible to purchase or
sell an Equity Security in a timely manner for any number of reasons,
including lack of liquidity in the relevant market, the unavailability
of a seller or purchaser of the Equity Securities, and restrictions on
such purchases or sales by reason of federal securities laws or
otherwise. Custody of certain of the Equity Securities in the Trust is
maintained by Cedel Bank S.A. ("CEDEL"), a global custody and clearing
institution which has entered into a sub-custodian relationship with the
Trustee.
On January 1, 1999, Austria, Belgium, Finland, France, Germany, Ireland,
Italy, Luxembourg, the Netherlands, Portugal and Spain (eleven of the
fifteen member countries of the European Union ("EU")) are scheduled to
establish fixed conversion rates between their existing sovereign
currencies and the euro. On such date the euro is expected to become the
official currency of these eleven countries. As of January 1, 1999, the
participating countries will no longer control their own monetary
policies by directing independent interest rates for their currencies.
Instead, the authority to direct monetary policy, including money supply
and official interest rates for the euro, will be exercised by the new
European Central Bank. The conversion of the national currencies of the
participating countries to the euro could negatively impact the market
rate of exchange between such currencies (or the newly created euro) and
the U.S. dollar. In addition, European corporations, and other entities
with significant markets or operations in Europe (whether or not in the
participating countries), face strategic challenges as these entities
adapt to a single trans-national currency. The euro conversion may have
a material impact on revenues, expenses or income from operations;
increase competition due to the increased price transparency of EU
markets; effect issuers' currency exchange rate risk and derivatives
exposure; disrupt current contracts; cause issuers to increase spending
on information technology updates required for the conversion; and
result in potential adverse tax consequences. The Sponsor is unable to
predict what impact, if any, the euro conversion will have on any of the
issuers of Equity Securities contained in the Trust.
The United Kingdom is a member of the EU, which was created through the
formation of the Maastricht Treaty on European Union in late 1993. It is
expected that the Treaty will have the effect of eliminating most
remaining trade barriers between the 15 member nations and make Europe
one of the largest common markets in the world. However, the effective
implementation of the Treaty provisions and the rate at which trade
barriers are eliminated is uncertain at this time. Furthermore, the
recent rapid political and social change throughout Europe make the
extent and nature of future economic development in the United Kingdom
and Europe and the impact of such development upon the value of Equity
Securities issued by United Kingdom companies impossible to predict.
The United Kingdom will not participate in the conversion to the euro on
January 1, 1999 and the Sponsor is unable to predict if or when the
United Kingdom will convert to the euro. Moreover, it is not possible to
accurately predict the effect of the current political and economic
situation upon long-term inflation and balance of trade cycles and how
these changes, as well as the implementation of a common currency
throughout a majority of EU countries, would affect the currency
exchange rate between the U.S. dollar and the British pound sterling.
Exchange Rate. The Trust is comprised of Equity Securities that are
principally traded in foreign currencies and as such, involve investment
risks that are substantially different from an investment in a fund
which invests in securities that are principally traded in United States
dollars. The United States dollar value of the portfolios (and hence of
the Units) and of the distributions from the portfolios will vary with
fluctuations in the United States dollar foreign exchange rates for the
relevant currencies. Most foreign currencies have fluctuated widely in
value against the United States dollar for many reasons, including
supply and demand of the respective currency, the rate of inflation in
the respective economies compared to the United States, the impact of
interest rate differentials between different currencies on the movement
of foreign currency rates, the balance of imports and exports goods and
services, the soundness of the world economy and the strength of the
respective economy as compared to the economies of the United States and
other countries.
Exchange rate fluctuations are partly dependent on a number of economic
factors including economic conditions within countries, the impact of
actual and proposed government policies on the value of currencies,
Page 15
interest rate differentials between the currencies and the balance of
imports and exports of goods and services and transfers of income and
capital from one country to another. These economic factors are
influenced primarily by a particular country's monetary and fiscal
policies (although the perceived political situation in a particular
country may have an influence as well-particularly with respect to
transfers of capital). Investor psychology may also be an important
determinant of currency fluctuations in the short run. Moreover,
institutional investors trying to anticipate the future relative
strength or weakness of a particular currency may sometimes exercise
considerable speculative influence on currency exchange rates by
purchasing or selling large amounts of the same currency or currencies.
However, over the long term, the currency of a country with a low rate
of inflation and a favorable balance of trade should increase in value
relative to the currency of a country with a high rate of inflation and
deficits in the balance of trade.
The Evaluator will estimate current exchange rates for the relevant
currencies based on activity in the various currency exchange markets.
However, since these markets are volatile and are constantly changing,
depending on the activity at any particular time of the large
international commercial banks, various central banks, large multi-
national corporations, speculators and other buyers and sellers of
foreign currencies, and since actual foreign currency transactions may
not be instantly reported, the exchange rates estimated by the Evaluator
may not be indicative of the amount in United States dollars the Trust
would receive had the Trustee sold any particular currency in the
market. The foreign exchange transactions of the Trust will be conducted
by the Trustee with foreign exchange dealers acting as principals on a
spot (i.e., cash) buying basis. Although foreign exchange dealers trade
on a net basis, they do realize a profit based upon the difference
between the price at which they are willing to buy a particular currency
(bid price) and the price at which they are willing to sell the currency
(offer price).
What are Some Additional Considerations for Investors?
The Trust consists of different issues of Equity Securities, all of
which are listed on a securities exchange and includes, but is not
limited to, ADRs and ADSs which are listed on the New York Stock
Exchange. 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.
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 value at the time 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 primary offering
period of Units of the Trust and during the Special Redemption and
Liquidation Period) and other factors.
Neither the Sponsor nor the Trustee shall be liable in any way for any
default, failure or defect in any Equity 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,
Page 16
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.
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, but 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
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 advisers. 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. 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, which is based on the
aggregate underlying U.S. dollar 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 such Trust, plus an initial sales charge with respect to the
Trust equal to the difference between the maximum sales charge for the
Trust ( % of the Public Offering Price) and the maximum remaining
deferred sales charge (initially $___ per Unit for the Trust) divided by
the number of Units of the Trust outstanding. Commencing ______, 1999,
and on the ____________ day of each month thereafter (or if such day is
not a business day, on the preceding business day), through ______,
1999, Unit holders will be assessed a deferred sales charge of $___ per
Unit per month. Units purchased subsequent to the initial deferred sales
Page 17
charge payment will be subject to the initial sales charge and the
remaining deferred sales charge payments. 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 % of the Public
Offering Price (equivalent to % 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 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 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 will not include deferred payments, but will instead
include only a one-time initial sales charge of % of the Public
Offering Price (equivalent to _____% of the net amount invested).
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 the 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 of the Trust. Rollover Unit holders of prior series of the Trust
may purchase Units of the Trust at the Public Offering Price, plus a
maximum sales charge of ___% of the Public Offering Price.
The minimum amount an investor may purchase in the Trust is $1,000 ($500
for Individual Retirement Accounts or other retirement plans). The
applicable sales charge for primary 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>
Dollar Amount of Transaction Maximum Net Dealer
at Public Offering Price* Discount Sales Charge Concession
____________________________ ________ ____________ __________
<S> <C> <C> <C>
$ 50,000 but less than $100,000 0.25% 2.50% 1.75%
$ 100,000 but less than $150,000 0.50% 2.25% 1.50%
$ 150,000 but less than $500,000 0.85% 1.90% 1.15%
$ 500,000 but less than $1,000,000 1.00% 1.75% 1.00%
$1,000,000 or more 1.75% 1.00% 0.50%
<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 the broker/dealer, bank or other selling
agent. Rollover Unit holders of prior series of the Trust may purchase
Units of the Trust subject to a maximum sales charge of $0.175 per Unit,
deferred as set forth above. In addition, Unit holders of other unit
investment trusts sponsored by the Sponsor which have a similar strategy
and maturity as the Trust may utilize the redemption or termination
proceeds, and Unit holders of unit investment trusts not sponsored by
the Sponsor which have a similar strategy as the Trust may utilize their
termination proceeds, to purchase Units of the Trust, subject to the
deferred sales charge to be collected on each of the remaining deferred
sales charge payment dates as provided herein. 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
Page 18
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, 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 affiliates and
vendors providing services to the Sponsor may purchase Units of the
Trust at the Public Offering Price, less the applicable dealer concession.
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 for purchases (see "Public Offering-How
are Units Distributed?") by investors who purchase Units through
registered investment advisors, 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, changes in relevant currency
exchange rates and changes in applicable commissions, stamp taxes,
custodial fees and other costs associated with foreign trading. During
the initial offering period, the aggregate value of the Units of the
Trust shall be determined on the basis of the aggregate underlying U.S.
dollar value of the Equity Securities therein plus or minus cash, if
any, in the Income and Capital Accounts of the Trust. The aggregate
underlying U.S. dollar value of the Equity Securities will be determined
in the following manner: if the Equity Securities are listed on a
securities exchange, 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 an 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. The aggregate U.S. dollar value of the Equity Securities
during the initial offering period is computed on the basis of the
offering side value of the relevant currency exchange rate expressed in
U.S. dollars as of the Evaluation Time.
After the completion of the initial offering period, the secondary
market Public Offering Price will be equal to the aggregate underlying
U.S. dollar 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 calculation of the aggregate underlying
U.S. dollar value of the Equity Securities for secondary market sales is
determined 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.
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.
Although payment is normally made three business days following the
order for purchase (the "date of settlement"), payment may be made prior
Page 19
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 or cash are deposited by the Sponsor, Units
will be distributed to the public at the then current Public Offering
Price. 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.
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 will be made to dealers and others at
prices which represent a concession or agency commission of ___% of the
Public Offering Price for primary and secondary market sales (___% on
purchases of $1,000,000 or more). Dealers and others will receive a
concession or agency commission of ___% of the Public Offering Price on
purchases by Rollover Unit holders.
The Sponsor reserves the right to change the amount of the concession or
agency commission from time to time. In the event the Sponsor
reacquires, or the Trustee redeems, Units from brokers, dealers and
others while a market is being maintained for such Units, such entities
agree to repay immediately to the Sponsor any such concession or agency
commission relating to such reacquired Units. Certain commercial banks
may be making Units of the Trusts available to their customers on an
agency basis. A portion of the sales charge paid by these customers is
retained by or remitted to the banks in the amounts 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 the
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 the 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 the 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
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, other investment indices,
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
Page 20
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, the S&P 500 Composite Price Stock
Index, or performance data from Lipper Analytical Services, Inc. and
Morningstar Publications, Inc. or from publications such as Money, The
New York Times, U.S. News and World Report, Business Week, Forbes or
Fortune. As with other performance data, performance comparisons should
not be considered representative of the Trust's relative performance for
any future period.
What are the Sponsor's Profits?
The Sponsor of the Trust will receive a gross sales commission equal to
% of the Public Offering Price of the Units (equivalent to % of the
net amount invested) less any reduced sales charge as described under
"Public Offering-How is the Public Offering Price Determined?" In
addition, the Sponsor may be considered to have realized a profit or 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." During the initial offering period, dealers and other
selling agents also may realize profits or sustain losses as a result of
fluctuations after the Initial Date of Deposit in the Public Offering
Price received by the dealers and other selling agents upon the sale of
Units.
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 %) or redeemed. The
secondary market public offering price of Units may be greater or less
than the cost of such Units to the Sponsor.
Will There be a Secondary Market?
After the initial offering period, although it is not obligated to do
so, the Sponsor intends to maintain a market for the Units and
continuously 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 OR HER UNITS, HE
OR SHE SHOULD INQUIRE OF THE SPONSOR AS TO CURRENT MARKET PRICES PRIOR
TO MAKING A TENDER FOR REDEMPTION TO THE TRUSTEE.
RIGHTS OF UNIT HOLDERS
How is Evidence of Ownership Issued and Transferred?
The Trustee is authorized to treat as the record owner of Units that
person who is registered as such owner on the books of the Trustee.
Ownership of Units may be evidenced by registered certificates executed
by the Trustee and the Sponsor. Delivery of certificates representing
Units ordered for purchase is normally made three business days
following such order or shortly thereafter. Certificates are
transferable by presentation and surrender to the Trustee properly
endorsed or accompanied by a written instrument or instruments of
transfer. Certificates to be redeemed must be properly endorsed or
Page 21
accompanied by a written instrument or instruments of transfer. A Unit
holder must sign exactly as his or her name appears on the face of the
certificate with 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 (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 (book entry) 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 must follow procedures established by the Trustee, including
furnishing indemnity satisfactory to the Trustee and paying 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 Equity Securities in the Trust on or about the Income
Distribution Date to Unit holders of record on the preceding Income
Distribution Record Date and again as part of the final liquidation
distribution. 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. 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 each 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). Notwithstanding, distributions of funds in
the Capital Account, if any, will be made as part of the final
liquidation distribution, and in certain circumstances, earlier. See
"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 under certain circumstances by
contacting the Trustee, otherwise the amount may be recoverable only
Page 22
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
who is not a Rollover Unit holder will, upon surrender of his or her
Units for redemption, receive (i) the pro rata share of the amounts
realized upon the disposition of Equity Securities and (ii) a pro rata
share of any other assets of the Trust, less expenses of such 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. Distributions of income or capital on
a Unit holder's Units will be automatically reinvested at net asset
value in additional Units of the Trust unless the Unit holder elects
otherwise. Each person who purchases Units of the Trust may elect not to
participate 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. A Unit holder 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 such Trust; (3) the redemption price per Unit based
upon a computation thereof on the 31st day of December of such year (or
the last business day prior thereto); and (4) amounts of income and
capital distributed during such year.
In order to comply with Federal and state tax reporting requirements,
Unit holders will be furnished, upon request to the Trustee, evaluations
of the Securities in the Trust furnished to it by the Evaluator.
How May Units be Redeemed?
A Unit holder may redeem all or a portion of his or her Units by tender
to the Trustee at its unit investment trust office in the City of New
York of the certificates representing the Units to be redeemed, or in
the case of uncertificated Units, delivery of a request for redemption,
duly endorsed or accompanied by proper instruments of transfer with
signature guaranteed as explained above (or by providing satisfactory
indemnity, as in connection with lost, stolen or destroyed
certificates), and payment of applicable governmental charges, if any.
No redemption fee will be charged. On the third business day following
such tender, the Unit holder will be entitled to receive in cash an
amount for each Unit equal to the Redemption Price per Unit next
computed after receipt by the Trustee of such tender of Units. The "date
of tender" is deemed to be the date on which Units are received by the
Trustee (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
the remaining deferred sales charge at the time of redemption.
Page 23
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 of the Trust will be and the diversity of
the Trust may 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 during the secondary market will be
determined on the basis of the aggregate underlying U.S. dollar value of
the Equity Securities in the Trust plus or minus cash, if any, in the
Income and Capital Accounts of the Trust (net of applicable liquidation
costs for foreign Equity Securities). The Redemption Price per Unit is
the pro rata share of each Unit determined by the Trustee by adding: (1)
the cash on hand in the Trust other than cash deposited in the Trust to
purchase Equity Securities not applied to the purchase of such Equity
Securities; (2) the aggregate value of the Equity Securities (including
"when issued" contracts, if any) 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 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. 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 underlying U.S. dollar value of the Equity Securities will
be determined in the following manner: if the Equity Securities are
listed on a securities exchange, 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 either 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 therefore is
other than on an 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 value of the Equity Securities is converted to their U.S.
dollar equivalent by computing the aggregate value on the basis of the
offer (during the initial offering period) or bid (subsequent to the
initial offering period) side value of the relevant currency exchange as
of the Evaluation Time and when determining the Redemption Price during
the secondary market includes the applicable liquidation costs
associated with the sale of foreign Equity Securities.
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
Page 24
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.
Special Redemption, Liquidation and Investment in a New Trust
If the 2000 Trust is offered to investors, a special redemption and
liquidation will be made of all Units of the Trust held by any Unit
holder (a "Rollover Unit holder") who affirmatively notifies the Trustee
in writing that he or she desires to participate as a Rollover Unit
holder by the Rollover Notification Date specified in the "Summary of
Essential Information."
All Units of Rollover Unit holders will be redeemed In-Kind during the
Special Redemption and Liquidation Period and the underlying Equity
Securities will be distributed to the Distribution Agent on behalf of
the Rollover Unit holders. During the Special Redemption and Liquidation
Period (as set forth in "Summary of Essential Information"), the
Distribution Agent will be required to sell all of the underlying Equity
Securities on behalf of Rollover Unit holders. The sales proceeds will
be net of brokerage fees, governmental charges or any expenses involved
in the sales.
The Distribution Agent may engage the Sponsor, as its agent, or other
brokers to sell the distributed Equity Securities. The Equity Securities
will be sold as quickly as is practicable during the Special Redemption
and Liquidation Period, subject to the Sponsor's sensitivity to the fact
that the concentrated sale of large volumes of Equity Securities may
affect market prices in a manner adverse to the interests of investors.
The Sponsor does not anticipate that the period will be longer than ten
business days, and it could be as short as one day, given that the
Equity Securities are usually highly liquid. The liquidity of any Equity
Security depends on the daily trading volume of the Equity Security and
the amount that the Sponsor has available for sale on any particular day.
The Rollover Unit holders' proceeds will be invested in the 2000 Trust,
if it is registered and offered for sale. The proceeds of redemption
available on each day will be used to buy 2000 Trust Units as the
proceeds become available at the Public Offering Price of the 2000
Trust, including a reduced sales charge per Unit. Units purchased with
other than redemption proceeds will be subject to the full sales charge.
The Sponsor intends to create 2000 Trust Units as quickly as possible,
dependent upon the availability and reasonably favorable prices of the
equity securities included in the 2000 Trust portfolio, and it is
intended that Rollover Unit holders will be given first priority to
purchase the 2000 Trust Units. There can be no assurance, however, that
the 2000 Trust will be created, or if created, as to the exact timing of
the creation of the 2000 Trust Units or the aggregate number of 2000
Trust Units which the Sponsor will create. The Sponsor may, in its sole
discretion, stop creating new Units (whether permanently or temporarily)
at any time it chooses, regardless of whether all proceeds of the
Special Redemption and Liquidation have been invested on behalf of
Rollover Unit holders. Cash which has not been invested on behalf of the
Rollover Unit holders in 2000 Trust Units will be distributed within a
reasonable time after such occurrence. However, since the Sponsor can
create Units, the Sponsor anticipates that sufficient Units can be
created, although moneys in the 2000 Trust may not be fully invested on
the next business day.
Any Rollover Unit holder may thus be redeemed out of the Trust and
become a holder of an entirely different Trust, the 2000 Trust, with a
different portfolio of equity securities. The Rollover Unit holders'
Units will be redeemed In-Kind and the distributed Equity Securities
shall be sold during the Special Redemption and Liquidation Period. In
accordance with the Rollover Unit holders' offer to purchase the 2000
Trust Units, the proceeds of the sales (and any other cash distributed
upon redemption) will be invested in the 2000 Trust, at the public
offering price, including a reduced sales charge per Unit.
This process of redemption, liquidation, and investment in a new Trust
is intended to allow for the fact that the portfolios selected are
chosen on the basis of growth and income potential only for a year, at
which point a new portfolio is chosen. It is contemplated that a similar
process of redemption, liquidation and investment in a new trust will be
available for the 2000 Trust and each subsequent series of the Trust,
approximately a year after that Series' creation. However, there is no
assurance that any such subsequent series of the Trust will be offered.
The Sponsor believes that the gradual redemption, liquidation and
investment in the Trust will help mitigate any negative market price
consequences stemming from the trading of large volumes of securities
Page 25
and of the underlying Equity Securities in the Trust in a short,
publicized period of time. The above procedures may, however, be
insufficient or unsuccessful in avoiding such price consequences. In
fact, market price trends may make it advantageous to sell or buy more
quickly or more slowly than permitted by these procedures. Rollover Unit
holders could then receive a less favorable average Unit price than if
they bought all their Units of the Trust on any given day of the period.
It should also be noted that Rollover Unit holders may realize taxable
capital gains on the Special Redemption and Liquidation but, in certain
unlikely circumstances, will not be entitled to a deduction for certain
capital losses and, due to the procedures for investing in the 2000
Trust, no cash would be distributed at that time to pay any taxes.
Included in the cash for the Special Redemption and Liquidation may be
an amount of cash attributable to the distribution of dividend income;
accordingly, Rollover Unit holders also will not have cash distributed
to pay any taxes. See "What is the Federal Tax Status of Unit holders?"
In addition, during this period a Unit holder will be at risk to the
extent that Equity Securities are not sold and will not have the benefit
of any stock appreciation to the extent that moneys have not been
invested; for this reason, the Sponsor will be inclined to sell and
purchase the Equity Securities in as short a period as they can without
materially adversely affecting the price of the Equity Securities.
Unit holders who do not inform the Distribution Agent that they wish to
have their Units so redeemed and liquidated ("Remaining Unit holders")
will continue to hold Units of the Trust as described in this Prospectus
until the Trust is terminated or until the Mandatory Termination Date
listed in the Summary of Essential Information, whichever occurs first.
These Remaining Unit holders will not realize capital gains or losses
due to the Special Redemption and Liquidation, and will not be charged
any additional sales charge. If a large percentage of Unit holders
become Rollover Unit holders, the aggregate size of the Trust will be
sharply reduced. As a consequence, expenses, if any, in excess of the
amount to be borne by the Trustee would constitute a higher percentage
amount per Unit than prior to the Special Redemption, Liquidation and
Investment in the 2000 Trust. The Trust might also be reduced below the
Discretionary Liquidation Amount listed in the Summary of Essential
Information because of the lesser number of Units in the Trust, and
possibly also due to a value reduction, however temporary, in Units
caused by the Sponsor's sales of Equity Securities; if so, the Sponsor
could then choose to liquidate the Trust without the consent of the
remaining Unit holders. See "Other Information-How May the Indenture be
Amended or Terminated?" The Equity Securities remaining in the Trust
after the Special Redemption and Liquidation Period will be sold by the
Sponsor as quickly as possible without, in its judgment, materially
adversely affecting the market price of the Equity Securities.
The Sponsor may for any reason, in its sole discretion, decide not to
sponsor the 2000 Trust or any subsequent series of the Trust, without
penalty or incurring liability to any Unit holder. If the Sponsor so
decides, the Sponsor shall notify the Unit holders before the Special
Redemption and Liquidation Period would have commenced. All Unit holders
will then be remaining Unit holders, with rights to ordinary redemption
as before. See "Rights of Unit Holders-How May Units be Redeemed?" The
Sponsor may modify the terms of the 2000 Trust or any subsequent series
of the Trust. The Sponsor may also modify, suspend or terminate the
Rollover Option upon notice to the Unit holders of such amendment at
least 60 days prior to the effective date of such amendment.
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 or she 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.
Page 26
How May Equity Securities be Removed from the Trust?
The Portfolio of the Trust is not "managed" by the Sponsor or the
Trustee. Their respective activities described herein are governed
solely by the provisions of the Indenture. The Indenture provides that
the Sponsor may (but need not) direct the Trustee to dispose of an
Equity Security in the event that an issuer defaults in the payment of a
dividend that has been declared, that any action or proceeding has been
instituted restraining the payment of dividends or there exists any
legal question or impediment affecting such Equity Security, that the
issuer of the Equity Security has breached a covenant which would affect
the payments of dividends, the credit standing of the issuer or
otherwise impair the sound investment character of the Equity Security,
that the issuer has defaulted on the payment on any other of its
outstanding obligations, that the price of the Equity Security has
declined to such an extent or other such credit factors exist so that in
the opinion of the Sponsor, the retention of such Equity Securities
would be detrimental to the Trust. Except as stated under "Portfolio-
What are Some Additional Considerations for Investors?" for Failed
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
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 a 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. The Sponsor
may consider sales of Units of unit investment trusts which it sponsors
in making recommendations to the Trustee as to the selection of
broker/dealers to execute the Trust's portfolio transactions.
INFORMATION AS TO SPONSOR, TRUSTEE AND EVALUATOR
Who is the Sponsor?
Nike Securities L.P., the Sponsor, specializes in the underwriting,
trading and distribution of unit investment trusts and other securities.
Nike Securities L.P., an Illinois limited partnership formed in 1991,
acts as Sponsor for successive series of The First Trust Combined
Series, the FT Series (formerly known as The First Trust Special
Situations Trust), The First Trust Insured Corporate Trust, The First
Trust of Insured Municipal Bonds, The First Trust GNMA, Templeton Growth
and Treasury Trust, Templeton Foreign Fund & U.S. Treasury Securities
Trust and The Advantage Growth and Treasury Securities Trust. First
Trust introduced the first insured unit investment trust in 1974 and to
date more than $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).
Page 27
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
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 a Trust which the Trustee may be required to pay under any
present or future law of the United States of America or of any other
taxing authority having jurisdiction. In addition, the Indenture
contains other customary provisions limiting the liability of the Trustee.
If the Sponsor shall fail to perform any of its duties under the
Indenture or 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
Page 28
Evaluator may resign or may be removed by the Sponsor and the Trustee,
in which event the Sponsor and the Trustee are to use their best efforts
to appoint a satisfactory successor. Such resignation or removal shall
become effective upon the acceptance of appointment by the successor
Evaluator. If upon resignation of the Evaluator no successor has
accepted appointment within 30 days after notice of resignation, the
Evaluator may apply to a court of competent jurisdiction for the
appointment of a successor.
The Trustee, Sponsor and Unit holders may rely on any evaluation
furnished by the Evaluator and shall have no responsibility for the
accuracy thereof. Determinations by the Evaluator under the Indenture
shall be made in good faith upon the basis of the best information
available to it, provided, however, that the Evaluator shall be under no
liability to the Trustee, Sponsor or Unit holders for errors in
judgment. This provision shall not protect the Evaluator in any case of
willful misfeasance, bad faith, gross negligence or reckless disregard
of its obligations and duties.
OTHER INFORMATION
How May the Indenture be Amended or Terminated?
The Sponsor and the Trustee have the power to amend the Indenture
without the consent of any of the Unit holders when such an amendment is
(1) to cure any ambiguity or to correct or supplement any provision of
the Indenture which may be defective or inconsistent with any other
provision contained therein, or (2) to make such other provisions as
shall not adversely affect the interest of the Unit holders (as
determined in good faith by the Sponsor and the Trustee).
The Indenture provides that the Trust shall terminate upon the 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 such 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 the 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 a
broker/dealer, including the Sponsor. If the Trust is liquidated because
of the redemption of unsold Units of the Trust by a broker/dealer, the
Sponsor will refund to each purchaser of Units of the Trust the entire
sales charge 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?" Also, because of the Special
Redemption and Liquidation in a New Trust, there is a possibility that
the Trust may be reduced below the Discretionary Liquidation Amount and
that the Trust could therefore be terminated at that time before the
Mandatory Termination Date of the Trust.
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 or her address appearing on the registration books of the
Trust maintained by the Trustee. Unit holders who do not elect the
Rollover Option 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 or her pro rata share of the balance of the Income and Capital
Accounts.
Page 29
Legal Opinions
The legality of the Units offered hereby and certain matters relating to
Federal tax law have been passed upon by Chapman and Cutler, 111 West
Monroe Street, Chicago, Illinois 60603, as counsel for the Sponsor.
Carter, Ledyard & Milburn, will act as counsel for the Trustee and as
special New York tax counsel for the Trust.
Experts
The statement of net assets, including the schedule of investments, of
the Trust at the opening of business on the Initial Date of Deposit
appearing in this Prospectus and Registration Statement has been audited
by Ernst & Young LLP, independent auditors, as set forth in their report
thereon appearing elsewhere herein and in the Registration Statement,
and is included in reliance upon such report given upon the authority of
such firm as experts in accounting and auditing.
Page 30
REPORT OF INDEPENDENT AUDITORS
The Sponsor, Nike Securities L.P., and Unit Holders
FT 305
We have audited the accompanying statement of net assets, including the
schedule of investments, of FT 305, comprised of 10 Uncommon EuroValues,
1999 Portfolio, as of the opening of business on ____________, 1999.
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 ____________,
1999. 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 305,
comprised of 10 Uncommon EuroValues, 1999 Portfolio, at the opening of
business on ____________, 1999 in conformity with generally accepted
accounting principles.
ERNST & YOUNG LLP
Chicago, Illinois
____________, 1999
Page 31
Statement of Net Assets
10 UNCOMMON EUROVALUES, 1999 PORTFOLIO
FT 305
At the Opening of Business on the Initial Date of Deposit
____________, 1999
<TABLE>
<CAPTION>
NET ASSETS
<S> <C>
Investment in Equity Securities represented by purchase contracts (1) (2) $
Less accrued organizational and offering costs (3) ( )
Less liability for deferred sales charge (4) ( )
__________
Net assets $
==========
Units outstanding
ANALYSIS OF NET ASSETS
Cost to investors (4) $
Less sales charge (4) ( )
__________
Less estimated organizational and offering costs (3) ( )
Net assets $
==========
</TABLE>
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 $ issued by The
Chase Manhattan Bank has been deposited with the Trustee as collateral,
covering the monies necessary for the purchase of the Equity Securities
pursuant to purchase contracts for such Equity Securities.
(3) A portion of the Public Offering Price on Units purchased prior to
the earlier of six months from 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 $_____ per
Unit, based upon the expected number of Units of the Trust to be
created. A distribution will be made at the earlier of six months from
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) The aggregate cost to investors includes a maximum total sales
charge computed at the rate of % of the Public Offering Price
(equivalent to % of the net amount invested) as described under
"Public Offering-How is the Public Offering Price Determined?"
Page 32
Schedule of Investments
10 UNCOMMON EUROVALUES, 1999 PORTFOLIO
FT 305
At the Opening of Business on the Initial Date of Deposit
____________, 1999
<TABLE>
<CAPTION>
Number Percentage Market Cost of Equity
of Ticker Symbol and of Aggregate Value per Securities
Shares Name of Issuer of Equity Securities (1) Offering Price Share to Trust (2)
______ _______________________________________ ______________ ________ ______________
<C> <S> <C> <C> <C>
10% $ $
10%
10%
10%
10%
10%
10%
10%
10%
10%
_______ __________
Total Investments 100% $
======== ==========
______________
<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
purchase contracts for the Equity Securities were entered into by the
Sponsor on _____, 1999. The Trust has a mandatory termination date of
February 21, 2000.
(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 closing sale prices of listed
Equity Securities on the applicable exchange and the ask prices of over-
the-counter traded Equity Securities (converted into U.S. dollars at the
offer side of the exchange rate at the Evaluation Time) at the close of
business on ________, 1999, the business day prior to 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 $ .
Cost and loss to Sponsor relating to the Equity Securities sold to the
Trust were $ and $ , respectively.
</FN>
</TABLE>
Page 33
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Page 34
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Page 35
CONTENTS:
Summary of Essential Information:
10 Uncommon EuroValues, 1999 Portfolio 3
FT 305:
What is the FT Series? 6
What are the Expenses and Charges? 7
What is the Federal Tax Status of Unit Holders? 9
Are Investments in the Trust Eligible for
Retirement Plans? 12
Portfolio:
What are the Equity Securities? 12
What are the Equity Securities Selected for the
10 Uncommon EuroValues, 1999 Portfolio? 13
Risk Factors 13
What are Some Additional Considerations for
Investors? 16
Public Offering:
How is the Public Offering Price Determined? 17
How are Units Distributed? 20
What are the Sponsor's Profits? 21
Will There be a Secondary Market? 21
Rights of Unit Holders:
How is Evidence of Ownership Issued
and Transferred? 21
How are Income and Capital Distributed? 22
What Reports will Unit Holders Receive? 23
How May Units be Redeemed? 23
Special Redemption, Liquidation and Investment
in a New Trust 25
How May Units be Purchased by the Sponsor? 26
How May Equity Securities be Removed from the Trust? 27
Information as to Sponsor, Trustee and Evaluator:
Who is the Sponsor? 27
Who is the Trustee? 28
Limitations on Liabilities of Sponsor and Trustee 28
Who is the Evaluator? 28
Other Information:
How May the Indenture be Amended or Terminated? 29
Legal Opinions 30
Experts 30
Report of Independent Auditors 31
Statement of Net Assets 32
Notes to Statement of Net Assets 32
Schedule of Investments 33
___________
When Units of the Trust are no longer available, or for investors who
will reinvest into subsequent series of the Trust, this Prospectus may
be used as a preliminary prospectus for a future series; in which case
investors should note the following:
INFORMATION CONTAINED HEREIN IS SUBJECT TO AMENDMENT. A REGISTRATION
STATEMENT RELATING TO SECURITIES OF A FUTURE SERIES HAS BEEN FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD
NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION
STATEMENT BECOMES EFFECTIVE.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, SECURITIES IN ANY STATE TO ANY PERSON TO WHOM IT IS
NOT LAWFUL TO MAKE SUCH OFFER IN SUCH STATE.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO, WHICH THE TRUST
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)
10 UNCOMMON
EUROVALUES,
1999 PORTFOLIO
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
____________, 1999
PLEASE RETAIN THIS PROSPECTUS
FOR FUTURE REFERENCE
Page 36
MEMORANDUM
Re: FT 305
As indicated in our cover letter transmitting the
Registration Statement on Form S-6 and other related material
under the Securities Act of 1933 to the Commission, the only
difference of consequence (except as described below) between FT
273, which is the current fund, and FT 305, the filing of which
this memorandum accompanies, is the change in the series number.
The list of securities comprising the Fund, the evaluation,
record and distribution dates and other changes pertaining
specifically to the new series, such as size and number of Units
in the Fund and the statement of condition of the new Fund, will
be filed by amendment.
1940 ACT
FORMS N-8A AND N-8B-2
These forms were not filed, as the Form N-8A and Form N-8B-2
filed in respect of Templeton Growth and Treasury Trust, Series 1
and subsequent series (File No. 811-05903) related also to the
subsequent series of the Fund.
1933 ACT
PROSPECTUS
The only significant changes in the Prospectus from the
Series 273 Prospectus relate to the series number and size and
the date and various items of information which will be derived
from and apply specifically to the bonds deposited in the Fund.
CONTENTS OF REGISTRATION STATEMENT
ITEM A Bonding Arrangements of Depositor:
Nike Securities L.P. is covered by a Broker's Fidelity
Bond, in the total amount of $1,000,000, the insurer
being National Union Fire Insurance Company of
Pittsburgh.
ITEM B This Registration Statement on Form S-6 comprises the
following papers and documents:
The facing sheet
The Prospectus
The signatures
Exhibits
S-1
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant, FT 305 has duly caused this Amendment No. 1 to
the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the Village of Lisle
and State of Illinois on January 7, 1999.
FT 305
(Registrant)
By: NIKE SECURITIES L.P.
(Depositor)
By Robert M. Porcellino
Senior Vice President
Pursuant to the requirements of the Securities Act of 1933,
this 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 January 7, 1999
Corporation, the
General Partner of
Nike Securities L.P. Robert M. Porcellino
Attorney-in-Fact**
David J. Allen Director of
Nike Securities
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., the Depositor.
** An executed copy of the related power of attorney was filed
with the Securities and Exchange Commission in connection
with Amendment No. 1 to form S-6 of The First Trust Combined
Series 258 (File No. 33-63483) and the same is hereby
incorporated by this reference.
S-2
CONSENTS OF COUNSEL
The consents of counsel to the use of their names in the
Prospectus included in this Registration Statement will be
contained in their respective opinions to be filed as Exhibits
3.1, 3.2, 3.3 and 3.4 of the Registration Statement.
CONSENT OF ERNST & YOUNG LLP
The consent of Ernst & Young LLP to the use of its name and
to the reference to such firm in the Prospectus included in this
Registration Statement will be filed by amendment.
CONSENT OF FIRST TRUST ADVISORS L.P.
The consent of First Trust Advisors L.P. to the use of its
name in the Prospectus included in the Registration Statement is
filed as Exhibit 4.1 to the Registration Statement.
S-3
EXHIBIT INDEX
1.1 Form of Standard Terms and Conditions of Trust for The
First Trust Special Situations Trust, Series 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 Nike
Financial Advisory Services 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 305 among Nike
Securities L.P., as Depositor, The Chase Manhattan Bank,
as Trustee and First Trust Advisors L.P., as Evaluator
and 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).
2.1 Copy of Certificate of Ownership (included in Exhibit 1.1
filed herewith on page 2 and incorporated herein by
reference).
3.1* Opinion of counsel as to legality of Securities being
registered.
3.2* Opinion of counsel as to Federal income tax status of
Securities being registered.
S-4
3.3* Opinion of counsel as to New York income tax status of
Securities being registered.
3.4* Opinion of counsel as to advancement of funds by Trustee.
4.1* Consent of First Trust Advisors L.P.
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).
___________________________________
* To be filed by amendment.
S-5
