Registration No. 333-88643
1940 Act No. 811-05903
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 3 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 331
B. Name of depositor:
NIKE SECURITIES L.P.
C. Complete address of depositor's principal executive offices:
1001 Warrenville Road
Lisle, Illinois 60532
D. Name and complete address of agents for service:
Copy to:
JAMES A. BOWEN ERIC F. FESS
c/o Nike Securities L.P. c/o Chapman and Cutler
1001 Warrenville Road 111 West Monroe Street
Lisle, Illinois 60532 Chicago, Illinois 60603
E. Title of Securities Being Registered:
An indefinite number of Units pursuant to Rule 24f-2
promulgated under the Investment Company Act of 1940, as
amended
F. Approximate date of proposed sale to public:
As soon as practicable after the effective date of the
Registration Statement.
|XXX|Check box if it is proposed that this filing will become
effective on December 30, 1999 at 2:00 p.m. pursuant to Rule 487.
________________________________
The Dow (sm) Dividend And Repurchase Target 5 Portfolio, Qualified 2000 Series
The Dow (sm) Dividend And Repurchase Target 10 Portfolio,
Qualified 2000 Series
European Target 20 Portfolio, Qualified 2000 Series
The Nasdaq Target 15 Portfolio, Qualified 2000 Series
The S&P Target 10 Portfolio, Qualified 2000 Series
FT 331
FT 331 is a series of a unit investment trust, the FT Series. Each of
the five portfolios listed above (each, a "Trust," and collectively, the
"Trusts") is a separate portfolio, or series, of FT 331 consisting of a
portfolio of common stocks ("Securities") selected by applying a
specialized strategy. The objective of each Trust is to provide an above-
average total return.
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED
OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
First Trust (registered trademark)
1-800-621-9533
The date of this prospectus is December 30, 1999
Page 1
Table of Contents
Summary of Essential Information 3
Fee Table 5
Report of Independent Auditors 7
Statements of Net Assets 8
Schedules of Investments 10
The FT Series 15
Portfolios 16
Risk Factors 18
Hypothetical Performance Information 20
Public Offering 22
Distribution of Units 23
The Sponsor's Profits 24
The Secondary Market 24
How We Purchase Units 24
Expenses and Charges 24
Tax Status 25
Rights of Unit Holders 25
Income and Capital Distributions 26
Redeeming Your Units 26
Investing in a New Trust 27
Removing Securities from a Trust 27
Amending or Terminating the Indenture 28
Information on the Sponsor, Trustee,
Shareholder Servicing Agent and Evaluator 29
Other Information 30
Page 2
Summary of Essential Information
FT 331
At the Opening of Business on the Initial Date of Deposit-December 30, 1999
Sponsor: Nike Securities L.P.
Trustee: The Chase Manhattan Bank
Shareholder Servicing Agent: BISYS Fund Services Ohio, Inc.
Evaluator: First Trust Advisors L.P.
<TABLE>
<CAPTION>
The Dow (sm) The Dow (sm)
Dart 5 Portfolio Dart 10 Portfolio European Target 20
Qualified 2000 Qualified 2000 Portfolio, Qualified
Series Series 2000 Series
____________ ____________ ____________
<S> <C> <C> <C>
Initial Number of Units (1) 14,875 14,974 14,999
Fractional Undivided Interest in the Trust per Unit (1) 1/14,875 1/14,974 1/14,999
Public Offering Price:
Aggregate Offering Price Evaluation of Securities per Unit (2) $ 10.082 $ 10.017 $ 10.000
Maximum Sales Charge of 1.0% of the Public Offering
Price per Unit (1.0% of the net amount invested) (3) $ .101 $ .100 $ .100
Less Deferred Sales Charge per Unit $ (.101) $ (.100) $ (.100)
Public Offering Price per Unit (4) $ 10.082 $ 10.017 $ 10.000
Sponsor's Initial Repurchase Price per Unit (5) $ 10.082 $ 10.017 $ 10.000
Redemption Price per Unit (based on aggregate underlying
value of Securities) (5) $ 10.082 $ 10.017 $ 10.000
Estimated Net Annual Distribution per Unit (6) $ .1514 $ .2358 $ .3097
CUSIP Number 30264V 265 30264V 281 30264K 707
Security Code 57909 57910 57911
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
First Settlement Date January 4, 2000
Mandatory Termination Date (7) December 29, 2000
_____________
<FN>
See "Notes to Summary of Essential Information" on page 4.
</FN>
</TABLE>
Page 3
Summary of Essential Information
FT 331
At the Opening of Business on the Initial Date of Deposit-December 30, 1999
Sponsor: Nike Securities L.P.
Trustee: The Chase Manhattan Bank
Shareholder Servicing Agent: BISYS Fund Services Ohio, Inc.
Evaluator: First Trust Advisors L.P.
<TABLE>
<CAPTION>
The Nasdaq Target 15 The S&P Target 10
Portfolio, Qualified Portfolio, Qualified
2000 Series 2000 Series
____________________ ____________
<S> <C> <C>
Initial Number of Units (1) 15,014 15,008
Fractional Undivided Interest in the Trust per Unit (1) 1/15,014 1/15,008
Public Offering Price:
Aggregate Offering Price Evaluation of Securities per Unit (2) $ 10.000 $ 10.000
Maximum Sales Charge of 1.0% of the Public Offering
Price per Unit (1.0% of the net amount invested) (3) $ .100 $ .100
Less Deferred Sales Charge per Unit $ (.100) $ (.100)
Public Offering Price per Unit (4) $ 10.000 $ 10.000
Sponsor's Initial Repurchase Price per Unit (5) $ 10.000 $ 10.000
Redemption Price per Unit (based on aggregate underlying
value of Securities) (5) $ 10.000 $ 10.000
Estimated Net Annual Distribution per Unit (6) N.A. N.A.
CUSIP Number 30264V 323 30264V 307
Security Code 57912 57913
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
First Settlement Date January 4, 2000
Mandatory Termination Date (7) December 29, 2000
_____________
<FN>
NOTES TO SUMMARY OF ESSENTIAL INFORMATION
(1) As of the close of business on December 31, 1999, we may adjust the
number of Units of the Trusts. If we make such an adjustment, the
fractional undivided interest per Unit will vary from the amounts
indicated above.
(2) Each listed Security is valued at its last closing sale price on the
relevant stock exchange on the business day prior to the Initial Date of
Deposit. If a Security is not listed, or if no closing sale price
exists, it is valued at its closing ask price on such date. The value of
foreign Securities trading in non-U.S. dollars is determined by
converting the value of such Securities to their U.S. dollar equivalent
based on the offering side of the currency exchange rate for the
currency in which a Security is generally denominated at the Evaluation
Time on the business day prior to the Initial Date of Deposit.
Evaluations for purposes of determining the purchase, sale or redemption
price of Units are made as of the close of trading on the New York Stock
Exchange ("NYSE") (generally 4:00 p.m. Eastern time) on each day on
which it is open (the "Evaluation Time").
(3) The maximum sales charge consists entirely of a deferred sales
charge. See "Fee Table" and "Public Offering."
(4) The Public Offering Price shown above reflects the value of the
Securities on the business day prior to the Initial Date of Deposit. No
investor will purchase Units at this price. The price you pay for your
Units will be based on their valuation at the Evaluation Time on the
date you purchase your Units. On the Initial Date of Deposit the Public
Offering Price per Unit will not include any accumulated dividends on
the Securities. After this date, a pro rata share of any accumulated
dividends on the Securities will be included.
(5) Until the earlier of six months after the Initial Date of Deposit or
the end of the initial offering period the Sponsor's Initial Repurchase
Price per Unit and Redemption Price per Unit will include the estimated
organization costs per Unit set forth under "Fee Table." After such
date, the Sponsor's Initial Repurchase Price per Unit and Redemption
Price per Unit will not include such estimated organization costs. See
"Redeeming Your Units."
(6) The actual net annual distribution per Unit you receive will vary
from that set forth above with changes in a Trust's fees and expenses,
dividends received, currency exchange rates, foreign withholding and
with the sale of Securities. See "Fee Table" and "Expenses and Charges."
Dividend yield was not a selection criteria for The S&P Target 10
Portfolio or The Nasdaq Target 15 Portfolio.
(7) See "Amending or Terminating the Indenture."
</FN>
</TABLE>
Page 4
Fee Table
This Fee Table describes the fees and expenses that you may, directly or
indirectly, pay if you buy and hold Units of a Trust. See "Public
Offering" and "Expenses and Charges." Although each Trust has a term of
approximately one year and is a unit investment trust rather than a
mutual fund, this information allows you to compare fees, assuming that
when each Trust terminates, the principal amount and distributions are
rolled over into a New Trust, and you pay only the deferred sales charge.
<TABLE>
<CAPTION>
THE DOW (SM) THE DOW (SM)
DIVIDEND AND DIVIDEND AND
REPURCHASE REPURCHASE EUROPEAN TARGET 20
TARGET 5 PORTFOLIO TARGET 10 PORTFOLIO PORTFOLIO
QUALIFIED 2000 SERIES QUALIFIED 2000 SERIES QUALIFIED 2000 SERIES
________________ _____________________ _____________________
<S> <C> <C> <C> <C> <C>
Amount Amount Amount
per Unit per Unit per Unit
________ ________ ________
Unit Holder Transaction Expenses
(as a percentage of public offering price)
Initial sales charge imposed on purchase 0.00%(a) $.000 0.00%(a) $.000 0.00%(a) $.000
Deferred sales charge 1.00%(b) .101 1.00%(b) .100 1.00%(b) .100
_____ _____ _____ _____ _____ _____
Maximum sales charge 1.00% $1.01 1.00% $1.00% $1.00 $.100
===== ===== ===== ===== ===== =====
Organization Costs
(as a percentage of public offering price)
Estimated organization costs .174%(c) $.0175 .175%(c) $.0175 .175%(c) $.0175
====== ===== ====== ====== ====== =====
Estimated Annual Trust Operating Expenses(d)
(as a percentage of average net assets)
Portfolio supervision, bookkeeping, admini-
strative and evaluation fees .058% $.0060 .059% $.0060 .060% $.0060
Trustee's fee, Shareholder Servicing
Agent's fee and other operating expenses .139%(e) .0144 .140%(e) .0144 .245%(e) .0244
_____ ______ _____ ______ _____ _____
Total .197% $.0204 .199% $.0204 .305% $.0304
===== ====== ===== ====== ===== =====
</TABLE>
<TABLE>
<CAPTION>
THE NASDAQ THE S&P TARGET
TARGET 15 PORTFOLIO 10 PORTFOLIO
QUALIFIED QUALIFIED
2000 SERIES 2000 SERIES
________________ ________________
<S> <C> <C> <C> <C>
Amount Amount
per Unit per Unit
________ ________
Unit Holder Transaction Expenses
(as a percentage of public offering price)
Initial sales charge imposed on purchase 0.00%(a) $.000 0.00%(a) $.000
Deferred sales charge 1.00%(b) .100 1.00%(b) .100
_____ _____ _____ _____
Maximum sales charge 1.00% $.100 1.00% $.100
===== ===== ===== =====
Organization Costs
(as a percentage of public offering price)
Estimated organization costs .175%(c) $.0175 .175%(c) $.0175
===== ===== ===== =====
Estimated Annual Trust Operating Expenses(d)
(as a percentage of average net assets)
Portfolio supervision, bookkeeping, administrative and evaluation fees .060% $.0060 .060% $.0060
Trustee's fee, Shareholder Servicing Agent's fee
and other operating expenses .165%(e) .0164 .175%(e) .0174
_____ ______ _____ ______
Total .225% $.0224 .235% $.0234
===== ====== ===== ======
Page 5
Example
This example is intended to help you compare the cost of investing in a
Trust with the cost of investing in other investment products. The
example assumes that you invest $10,000 in a Trust for the periods shown
and sell all your Units at the end of those periods. The example also
assumes a 5% return on your investment each year and that a Trust's
operating expenses stay the same. Although your actual costs may vary,
based on these assumptions your costs would be:
1 Year 3 Years 5 Years 10 Years
______ _______ _______ ________
<C> <C> <C> <C>
The Dow (sm) Dividend And Repurchase Target 5 Portfolio, Qualified 2000 Series $137 $426 $737 $1,618
The Dow(sm) Dividend And Repurchase Target 10 Portfolio, Qualified 2000 Series 137 427 739 1,621
European Target 20 Portfolio, Qualified 2000 Series 148 459 793 1,736
The Nasdaq Target 15 Portfolio, Qualified 2000 Series 140 435 752 1,650
The S&P Target 10 Portfolio, Qualified 2000 Series 141 438 757 1,661
The example will not differ if you hold rather than sell your Units at
the end of each period. The example does not reflect sales charges on
reinvested dividends and other distributions. If these sales charges
were included, your costs would be higher.
________________
<FN>
(a) There is no initial sales charge on Trust Units.
(b) The deferred sales charge for each Trust is a fixed dollar amount
equal to $.0083 per Unit per month ($.0084 per Unit per month in the
case of The Dow sm Dividend And Repurchase Target 5 Portfolio) which
will be deducted each month over the life of a Trust. If you buy Units
of a Trust at a price less than the Public Offering Price per Unit set
forth in "Summary of Essential Information", the dollar amount of the
deferred sales charge will not change but the deferred sales charge on a
percentage basis will be more than 1.00% of the Public Offering Price.
If you purchase Units after the first deferred sales charge payment has
been deducted, you will only be assessed the amount of any remaining
deferred sales charge payments.
(c) You will bear all or a portion of the costs incurred in organizing
your respective Trust. These estimated organization costs are included
in the price you pay for your Units and will be deducted from the assets
of a Trust at the earlier of six months after the Initial Date of
Deposit or the end of the initial offering period.
(d) The Sponsor will bear annual Trust Operating Expenses in excess of
the amounts set forth above (if applicable) for each Trust.
(e) Other operating expenses for certain Trusts include estimated per
Unit costs associated with a license fee as described in "Expenses and
Charges," but do not include brokerage costs and other portfolio
transaction fees for any of the Trusts. In certain circumstances the
Trusts may incur additional expenses not set forth above. See "Expenses
and Charges."
</FN>
</TABLE>
Page 6
Report of Independent Auditors
The Sponsor, Nike Securities L.P., and Unit Holders
FT 331
We have audited the accompanying statements of net assets, including the
schedules of investments, of FT 331, comprised of The Dow(sm) Dividend
And Repurchase Target 5 Portfolio, Qualified 2000 Series; The Dow(sm)
Dividend And Repurchase Target 10 Portfolio, Qualified 2000 Series;
European Target 20 Portfolio, Qualified 2000 Series; The Nasdaq Target
15 Portfolio, Qualified 2000 Series; and The S&P Target 10 Portfolio,
Qualified 2000 Series, as of the opening of business on December 30,
1999. These statements of net assets are the responsibility of the
Trusts' Sponsor. Our responsibility is to express an opinion on these
statements of net assets based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the statements of net assets
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
statements of net assets. Our procedures included confirmation of the
letter of credit allocated among the Trusts on December 30, 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 statements of net assets. We believe that
our audit of the statements of net assets provides a reasonable basis
for our opinion.
In our opinion, the statements of net assets referred to above present
fairly, in all material respects, the financial position of FT 331,
comprised of The Dow (sm) Dividend And Repurchase Target 5 Portfolio,
Qualified 2000 Series; The Dow(sm) Dividend And Repurchase Target 10
Portfolio, Qualified 2000 Series; European Target 20 Portfolio, Qualified 2000
Series; The Nasdaq Target 15 Portfolio, Qualified 2000 Series; and The S&P
Target 10 Portfolio, Qualified 2000 Series, at the opening of business on
December 30, 1999 in conformity with generally accepted accounting principles.
ERNST & YOUNG LLP
Chicago, Illinois
December 30, 1999
Page 7
Statements of Net Assets
FT 331
At the Opening of Business on the
Initial Date of Deposit-December 30, 1999
<TABLE>
<CAPTION>
The Dow(sm)
The Dow(sm) DART 10
DART 5 Portfolio Portfolio European Target 20
Qualified 2000 Qualified 2000 Portfolio, Qualified
Series Series 2000 Series
____________ ____________ ____________
<S> <C> <C> <C>
NET ASSETS
Investment in Securities represented
by purchase contracts (1) (2) $149,971 $149,993 $149,992
Less liability for reimbursement to Sponsor
for organization costs (3) (260) (262) (262)
________ ________ ________
Net assets $149,711 $149,731 $149,730
======== ======== ========
Units outstanding 14,875 14,974 14,999
ANALYSIS OF NET ASSETS
Cost to investors (4) $149,971 $149,993 $149,992
Less sales charge (4) (0) (0) (0)
Less estimated reimbursement to Sponsor
for organization costs (3) (260) (262) (262)
________ ________ ________
Net assets $149,711 $149,731 $149,730
======== ======== ========
__________
<FN>
See "Notes to Statements of Net Assets" on page 9.
</FN>
</TABLE>
Page 8
Statements of Net Assets
FT 331
At the Opening of Business on the
Initial Date of Deposit-December 30, 1999
<TABLE>
<CAPTION>
The Nasdaq Target 15 The S&P Target 10
Portfolio, Qualified Portfolio, Qualified
2000 Series 2000 Series
____________________ ____________________
<S> <C> <C>
NET ASSETS
Investment in Securities represented
by purchase contracts (1) (2) $150,136 $150,081
Less liability for reimbursement to Sponsor
for organization costs (3) (263) (263)
________ ________
Net assets $149,873 $149,818
======== ========
Units outstanding 15,014 15,008
ANALYSIS OF NET ASSETS
Cost to investors (4) $150,136 $150,081
Less sales charge (4) (0) (0)
Less estimated reimbursement to Sponsor
for organization costs (3) (263) (263)
________ ________
Net assets $149,873 $149,818
======== ========
______________
<FN>
NOTES TO STATEMENTS OF NET ASSETS
(1) Aggregate cost of the Securities listed under "Schedule of
Investments" for each Trust is based on their aggregate underlying value.
(2) An irrevocable letter of credit issued by The Chase Manhattan Bank,
of which $1,000,000 will be allocated among each of the five Trusts in
FT 331, has been deposited with the Trustee as collateral, covering the
monies necessary for the purchase of the Securities according to their
purchase contracts.
(3) A portion of the Public Offering Price consists of an amount
sufficient to reimburse the Sponsor for all or a portion of the costs of
establishing the Trusts. These costs have been estimated at $.0175 per
Unit for each Trust. A payment will be made as of the earlier of six
months after the Initial Date of Deposit or the end of the initial
offering period to an account maintained by the Trustee from which the
obligation of the investors to the Sponsor will be satisfied. To the
extent that actual organization costs of a Trust are greater than the
estimated amount, only the estimated organization costs added to the
Public Offering Price will be reimbursed to the Sponsor and deducted
from the assets of such Trust.
(4) No initial sales charge will be assessed on Trust Units. A deferred
sales charge aggregating $.101 per Unit for The Dow(sm) DART 5 Portfolio and
aggregating $.100 per Unit for each of the other four Trusts, which will be
paid to us in twelve approximately equal monthly installments beginning
on January 20, 2000 and on the 20th day of each month thereafter (or the
preceding business day if the 20th day is not a business day) through
December 20, 2000, will be assessed on Trust Units outstanding on each
installment payment date. If you redeem Units you will not have to pay
the remaining amount of the deferred sales charge applicable to such
Units when you redeem them.
</FN>
</TABLE>
Page 9
Schedule of Investments
The Dow(sm) Dividend And Repurchase Target 5 Portfolio
Qualified 2000 Series
FT 331
At the Opening of Business on the
Initial Date of Deposit-December 30, 1999
<TABLE>
<CAPTION>
Percentage
Number of Aggregate Market Cost of Current
of Ticker Symbol and Offering Value per Securities to Dividend
Shares Name of Issuer of Securities (1) Price Share the Trust (2) Yield (3)
______ _______________________________________ ___________ ________ _____________ _______
<C> <S> <C> <C> <C> <C>
726 BA The Boeing Company 20% $ 41.313 $ 29,993 1.36%
451 EK Eastman Kodak Company 20% 66.500 29,991 2.65%
413 GM General Motors Corporation 20% 72.563 29,969 2.76%
264 HWP Hewlett-Packard Company 20% 113.625 29,997 0.56%
529 HON Honeywell International Inc. 20% 56.750 30,021 1.20%
______ ________
Total Investments 100% $149,971
===== ========
___________
<FN>
See "Notes to Schedules of Investments" on page 14.
</FN>
</TABLE>
Page 10
Schedule of Investments
The Dow (sm) Dividend And Repurchase Target 10 Portfolio
Qualified 2000 Series
FT 331
At the Opening of Business on the
Initial Date of Deposit-December 30, 1999
<TABLE>
<CAPTION>
Percentage
Number of Aggregate Market Cost of Current
of Ticker Symbol and Offering Value per Securities to Dividend
Shares Name of Issuer of Securities (1) Price Share the Trust (2) Yield (3)
______ _______________________________________ ___________ ________ _____________ _______
<C> <S> <C> <C> <C> <C>
363 BA The Boeing Company 10% $ 41.313 $ 14,997 1.36%
324 CAT Caterpillar Inc. 10% 46.313 15,005 2.81%
226 EK Eastman Kodak Company 10% 66.500 15,029 2.65%
207 GM General Motors Corporation 10% 72.563 15,021 2.76%
132 HWP Hewlett-Packard Company 10% 113.625 14,999 0.56%
264 HON Honeywell International Inc. 10% 56.750 14,982 1.20%
219 MRK Merck & Co., Inc. 10% 68.375 14,974 1.70%
118 JPM J.P. Morgan & Company, Inc. 10% 127.000 14,986 3.15%
643 MO Philip Morris Companies, Inc. 10% 23.313 14,990 8.24%
137 PG Procter & Gamble Company 10% 109.563 15,010 1.17%
______ ________
Total Investments 100% $149,993
===== ========
___________
<FN>
See "Notes to Schedules of Investments" on page 14.
</FN>
</TABLE>
Page 11
Schedule of Investments
European Target 20 Portfolio, Qualified 2000 Series
FT 331
At the Opening of Business on the
Initial Date of Deposit-December 30, 1999
<TABLE>
<CAPTION>
Percentage
Number of Aggregate Market Cost of Current
of Offering Value per Securities to Dividend
Shares Name of Issuer of Securities (1) Price Share the Trust (2) Yield (3)
______ ________________________________ ___________ ________ _____________ _________
<C> <S> <C> <C> <C> <C>
301 ABN AMRO Holding NV 5% $24.955 $ 7,511 2.43%
470 Abbey National Plc 5% 15.944 7,494 4.16%
1,175 BG Group Plc 5% 6.384 7,501 2.50%
263 Barclays Plc 5% 28.541 7,506 2.83%
467 CGU Plc 5% 16.049 7,495 4.05%
97 DaimlerChrysler AG 5% 77.356 7,504 4.36%
920 Diageo Plc 5% 8.150 7,498 4.30%
1,403 ENI SpA 5% 5.345 7,498 2.91%
379 Endesa SA 5% 19.781 7,497 2.81%
688 Halifax Group Plc 5% 10.899 7,499 3.46%
241 Hoechst AG 5% 31.143 7,506 3.53%
608 Lloyds TSB Group Plc 5% 12.330 7,497 3.44%
354 National Westminster Bank Plc 5% 21.168 7,493 3.17%
193 RWE AG 5% 38.879 7,504 3.69%
321 Rio Tinto Plc 5% 23.334 7,490 2.50%
422 Royal Bank of Scotland Group Plc 5% 17.772 7,500 2.88%
560 San Paolo-IMI SpA 5% 13.392 7,499 3.49%
1,012 ScottishPower Plc 5% 7.414 7,503 5.64%
910 Shell Transport & Trading Company Plc 5% 8.239 7,498 2.99%
1,023 Unilever Plc 5% 7.330 7,499 2.86%
______ ________
Total Investments 100% $149,992
===== ========
___________
<FN>
See "Notes to Schedules of Investments" on page 14.
</FN>
</TABLE>
Page 12
Schedule of Investments
The Nasdaq Target 15 Portfolio, Qualified 2000 Series
FT 331
At the Opening of Business on the
Initial Date of Deposit-December 30, 1999
<TABLE>
<CAPTION>
Percentage
Number of Aggregate Market Cost of Market
of Ticker Symbol and Offering Value per Securities to Capitalization
Shares Name of Issuer of Securities (1) Price Share the Trust (2) (in millions) (4)
______ _______________________________________ ___________ ________ _____________ _______________
<C> <S> <C> <C> <C> <C>
67 ADBE Adobe Systems Incorporated 2.94% $ 65.938 $ 4,418 $ 7,926
87 AAPL Apple Computer, Inc. 5.84% 100.688 8,760 16,227
29 AMCC Applied Micro Circuits Corporation 2.32% 120.000 3,480 6,474
107 ATML Atmel Corporation 2.13% 29.938 3,203 6,036
63 CMGI CMGI Inc. 11.57% 275.813 17,376 33,917
35 ERTS Electronic Arts Inc. 1.97% 84.625 2,962 5,349
32 MEDI MedImmune, Inc. 3.58% 168.125 5,380 10,639
341 ORCL Oracle Corporation 24.98% 110.000 37,510 156,604
36 PMCS PMC-Sierra, Inc. 3.57% 148.938 5,362 10,136
20 QLGC QLogic Corporation 2.08% 155.875 3,118 5,697
43 RFMD RF Micro Devices, Inc. 1.93% 67.313 2,894 5,343
101 SEBL Siebel Systems, Inc. 5.72% 85.000 8,585 16,070
481 SUNW Sun Microsystems, Inc. 24.99% 78.000 37,518 121,845
30 VISX VISX, Incorporated 1.02% 50.875 1,526 3,272
180 XLNX Xilinx, Inc. 5.36% 44.688 8,044 14,249
______ ________
Total Investments 100% $150,136
====== ========
___________
<FN>
See "Notes to Schedules of Investments" on page 14.
</FN>
</TABLE>
Page 13
Schedule of Investments
The S&P Target 10 Portfolio, Qualified 2000 Series
FT 331
At the Opening of Business on the
Initial Date of Deposit-December 30, 1999
<TABLE>
<CAPTION>
Percentage
Number of Aggregate Market Cost of
of Ticker Symbol and Offering Value per Securities to
Shares Name of Issuer of Securities (1) Price Share the Trust (2)
______ _______________________ _________ ______ _________
<C> <S> <C> <C> <C> <C>
227 AA Alcoa Inc. 12.36% $ 81.750 $ 18,557
258 AVY Avery Dennison Corporation 12.36% 71.875 18,544
422 CC Circuit City Stores-Circuit City Group 12.34% 43.875 18,515
123 C Citigroup Inc. 4.50% 54.875 6,750
372 GP Georgia-Pacific Group 12.36% 49.875 18,554
80 LEH Lehman Brothers Holdings Inc. 4.50% 84.438 6,755
49 MWD Morgan Stanley Dean Witter & Co. 4.54% 138.938 6,808
391 SEG Seagate Technology, Inc. 12.36% 47.438 18,548
392 TAN Tandy Corporation 12.34% 47.250 18,522
275 WMT Wal-Mart Stores, Inc. 12.34% 67.375 18,528
______ ________
Total Investments 100% $150,081
====== ========
__________________
<FN>
NOTES TO SCHEDULES OF INVESTMENTS
(1) All Securities are represented by regular way contracts to purchase
such Securities which are backed by an irrevocable letter of credit
deposited with the Trustee. We entered into purchase contracts for the
Securities on December 30, 1999. Each Trust has a Mandatory Termination
Date of December 29, 2000.
(2) The cost of the Securities to a Trust represents the aggregate
underlying value with respect to the Securities acquired-generally
determined by the closing sale prices of the Securities on the
applicable exchange (where applicable, converted into U.S. dollars at
the offer side of the exchange rate at the Evaluation Time) at the
Evaluation Time on December 29, 1999, the business day prior to the
Initial Date of Deposit. The valuation of the Securities has been
determined by the Evaluator, an affiliate of ours. The cost of the
Securities to us and our loss (which is the difference between
the cost of the Securities to us and the cost of the Securities to a
Trust) are set forth below:
Cost of
Securities Profit
to Sponsor (Loss)
___________ _______
The Dow(sm) Dividend And Repurchase Target 5 Portfolio, Qualified 2000 Series $149,985 $ (14)
The Dow(sm) Dividend And Repurchase Target 10 Portfolio, Qualified 2000 Series 150,327 (334)
European Target 20 Portfolio, Qualified 2000 Series 152,786 (2,794)
The Nasdaq Target 15 Portfolio, Qualified 2000 Series 150,845 (709)
The S&P Target 10 Portfolio, Qualified 2000 Series 150,204 (123)
(3) Current Dividend Yield for each Security was calculated by dividing
the most recent annualized ordinary dividend paid on a Security by that
Security's closing sale price at the Evaluation Time on the business day
prior to the Initial Date of Deposit.
(4) Market capitalization is based on the market value as of the close
of business on December 29, 1999.
</FN>
</TABLE>
Page 14
The FT Series
The FT Series Defined.
We, Nike Securities L.P. (the "Sponsor"), have created several similar
yet separate series of a unit investment trust which we have named the
FT Series. We designate each of these series of the FT Series with a
different series number. Each of the following is a separate portfolio,
or series, of FT 331:
- - The Dow(sm) Dividend And Repurchase Target 5 Portfolio
- - The Dow(sm) Dividend And Repurchase Target 10 Portfolio
- - European Target 20 Portfolio
- - The Nasdaq Target 15 Portfolio
- - The S&P Target 10 Portfolio
Units of the Trusts are only available to employee benefit plans
established pursuant to Sections 401(a) or 457 of the Internal Revenue
Code of 1986, as amended ("Eligible Plans"). Eligible Plans will invest
in Units of the Trusts in accordance with allocation instructions
received from employees pursuant to their respective terms. Accordingly,
the interests of an employee in the Units of a Trust is subject to the
terms of their respective Eligible Plan and the terms on which Units of
the Trusts are offered as an investment alternative under such Eligible
Plan. As used herein, Unit holder shall refer to an Eligible Plan.
YOU MAY GET MORE SPECIFIC DETAILS CONCERNING THE NATURE, STRUCTURE AND
RISKS OF THIS PRODUCT IN AN "INFORMATION SUPPLEMENT" BY CALLING THE
TRUSTEE AT 1-800-682-7520.
Mandatory Termination Date.
The Trusts will terminate on the Mandatory Termination Date set forth in
"Summary of Essential Information." Each Trust was created under the
laws of the State of New York by a Trust Agreement (the
"Indenture") dated the Initial Date of Deposit. This agreement, entered
into among Nike Securities L.P., as Sponsor, The Chase Manhattan Bank as
Trustee, BISYS Fund Services Ohio, Inc. as Shareholder Servicing Agent
and First Trust Advisors L.P. as Portfolio Supervisor and Evaluator,
governs the operation of the Trusts.
How We Created the Trusts.
On the Initial Date of Deposit, we deposited the portfolios of common
stocks with the Trustee and in turn, the Trustee delivered documents to
us representing our ownership of the Trusts in the form of units
("Units").
With our deposit of Securities on the Initial Date of Deposit we
established a percentage relationship among the Securities in each
Trust's portfolio, as stated under "Schedule of Investments" for each
Trust. After the Initial Date of Deposit, we may deposit additional
Securities in a Trust, or cash (including a letter of credit) with
instructions to buy more Securities, to create new Units for sale. If we
create additional Units, we will attempt, to the extent practicable, to
maintain the percentage relationship established among the Securities on
the Initial Date of Deposit, and not the percentage relationship
existing on the day we are creating new Units, since the two may differ.
This difference may be due to the sale, redemption or liquidation of any
of the Securities.
Since the prices of the Securities will fluctuate daily, the ratio of
Securities in a Trust, on a market value basis, will also change daily.
The portion of Securities represented by each Unit will not change as a
result of the deposit of additional Securities or cash in a Trust. If we
deposit cash, you and new investors may experience a dilution of your
investment. This is because prices of Securities will fluctuate between
the time of the cash deposit and the purchase of the Securities, and
because the Trust pays the associated brokerage fees. To reduce this
dilution, the Trusts will try to buy the Securities as close to the
Evaluation Time and as close to the evaluation price as possible.
An affiliate of the Trustee may receive these brokerage fees or the
Trustee may retain and pay us (or our affiliate) to act as agent for a
Trust to buy Securities. If we or an affiliate of ours act as agent to a
Trust we will be subject to the restrictions under the Investment
Company Act of 1940, as amended.
Page 15
We cannot guarantee that a Trust will keep its present size and
composition for any length of time. Securities may periodically be sold
under certain circumstances, and the proceeds from these sales will be
used to meet Trust obligations or distributed to Unit holders, but will
not be reinvested. However, Securities will not be sold to take
advantage of market fluctuations or changes in anticipated rates of
appreciation or depreciation, or if they no longer meet the criteria by
which they were selected. You will not be able to dispose of or vote any
of the Securities in a Trust. As the holder of the Securities, the
Trustee will vote all of the Securities and will do so based on our
instructions.
Neither we nor the Trustee will be liable for a failure in any of the
Securities. However, if a contract for the purchase of any of the
Securities initially deposited in a Trust fails, unless we can purchase
substitute Securities ("Replacement Securities") we will refund to you
that portion of the purchase price and sales charge resulting from the
failed contract on the next Income Distribution Date. Any Replacement
Security a Trust acquires will be identical to those from the failed
contract.
Portfolios
Objectives.
When you invest in a Trust you are purchasing a quality portfolio of
attractive common stocks in one convenient purchase. The objective of
each Trust is to provide an above-average total return. To achieve this
objective, each Trust will invest in the common stocks of companies
which are selected by applying a unique specialized strategy. While the
Trusts all seek to provide above-average total return, each follows a
different investment strategy. Because the Trusts' lives are short
(approximately one year), we cannot guarantee that a Trust will achieve
its objective or that a Trust will make money once expenses are deducted.
The Dow (sm) Dividend and Repurchase Target Portfolio Strategies.
Both The Dow (sm) Dividend and Repurchase Target ("DART") 5 Portfolio
Strategy and The Dow (sm) DART 10 Portfolio Strategy select a portfolio
of Dow Jones Industrial Average ("DJIA") stocks with high dividend
yields and/or high buyback ratios, and, for the Dow (sm) DART 5
Portfolio Strategy, high return on assets, as a means to achieving each
Strategy's investment objective. By analyzing dividend yields, each
Strategy seeks to uncover stocks that may be out of favor or
undervalued. More recently, many companies have turned to stock
reduction programs as a tax efficient way to bolster their stock prices
and reward shareholders. Companies which have reduced their shares
through a share buyback programs may indicate a company with a strong
cash flow position and high quality earnings. Buyback ratio is the ratio
of a company's shares of common stock outstanding 12 months prior to the
date of this prospectus divided by a company's shares outstanding as of
the business day prior to the date of this prospectus, minus "1."
The Dow (sm) DART 5 Strategy.
The Dow (sm) DART 5 Portfolio is determined as follows:
Step 1: We rank all 30 stocks contained in the DJIA by the sum of their
dividend yield and buyback ratio as of the business day prior to the
date of this prospectus.
Step 2: We then select the ten stocks with the highest combined dividend
yields and buyback ratios.
Step 3: From the ten stocks selected in Step 2, we select the five
stocks with the greatest increase in the percentage change in return on
assets in the most recent year as compared to the previous year for The
Dow(sm) DART 5 Portfolio.
The Dow(sm) DART 10 Strategy.
The Dow(sm) DART 10 Portfolio is determined as follows:
Step 1: We rank all 30 stocks contained in the DJIA by the sum of their
dividend yield and buyback ratio as of the business day prior to the
date of this prospectus.
Step 2: We then select the ten stocks with the highest combined dividend
yields and buyback ratios for The Dow(sm) DART 10 Portfolio.
European Target 20 Portfolio Strategy.
The European Target 20 Portfolio invests in stocks with high dividend
yields. Investing in stocks with high dividend yields may be effective
in achieving the Trust's investment objective, because regular dividends
are common for established companies, and dividends have historically
accounted for a large portion of the total return on stocks. The
European Target 20 Portfolio is determined as follows:
Step 1: We rank the 120 largest companies based on market capitalization
which are headquartered in Austria, Belgium, Denmark, Finland, Germany,
Greece, Ireland, Italy, the Netherlands, Norway, Portugal, Spain,
Sweden, Switzerland or the United Kingdom by dividend yield as of two
business days prior to the date of this prospectus.
Step 2: We select the 20 highest dividend-yielding stocks for the
European Target 20 Portfolio.
Page 16
The Nasdaq Target 15 Portfolio Strategy.
The Nasdaq Target 15 Portfolio invests in a portfolio of 15 Nasdaq 100
Index stocks with the best overall ranking on both 12- and 6-month price
appreciation, return on assets and price to cashflow as a means to
achieving the Trust's investment objective. The Nasdaq Target 15
Portfolio is determined as follows:
Step 1: We select stocks which are components of the Nasdaq 100 Index as
of two business days prior to the date of this prospectus and
numerically rank them by 12-month price appreciation (best (1) to worst
(100)).
Step 2: We then numerically rank the stocks by six-month price
appreciation.
Step 3: The stocks are then numerically ranked by return on assets ratio.
Step 4: We then numerically rank the stocks by the ratio of cash flow
per share to stock price.
Step 5: We add up the numerical ranks achieved by each company in the
above steps and select the 15 stocks with the lowest sums for The Nasdaq
Target 15 Portfolio.
The stocks which comprise The Nasdaq Target 15 Portfolio are weighted by
market capitalization subject to the restriction that no stock will
comprise less than 1% or 25% or more of the portfolio on the date of
this prospectus. The Securities will be adjusted on a proportionate
basis to accommodate this constraint.
Companies that, based on publicly available information as of two
business days prior to the date of this prospectus, are the subject of
an announced business combination which we expect will happen within six
months of date of this prospectus have been excluded from The Nasdaq
Target 15 Portfolio.
The S&P Target 10 Portfolio Strategy.
The S&P Target 10 Portfolio invests in a portfolio of 10 of the largest
Standard & Poor's 500 Composite Stock Price Index ("S&P 500 Index")
stocks with the lowest price-to-sales ratio and greatest one-year price
appreciation as a means to achieving the Trust's investment objective.
The S&P Target 10 Portfolio is determined as follows:
Step 1: We select the 250 largest companies based on market
capitalization which are components of the S&P 500 Index as of two
business days prior to the date of this prospectus.
Step 2: From the above list, the 125 companies with the lowest price to
sales ratios are selected.
Step 3: The 10 companies which had the greatest 1-year stock price
appreciation are selected for The S&P Target 10 Portfolio.
The S&P Target 10 Portfolio will not invest more than 5% of its
portfolio in shares of any one securities-related issuer.
Please note that we applied each strategy which makes up the portfolio
for each Trust at a particular time. If we create additional Units of a
Trust after the Initial Date of Deposit we will deposit the Securities
originally selected by applying the strategy at such time. This is true
even if a later application of a strategy would have resulted in the
selection of different securities.
"Dow Jones Industrial Average(sm) ," "Dow(sm)" and "DJIA(sm)" are
service marks of Dow Jones & Company, Inc. ("Dow Jones") and have been
licensed for use for certain purposes by First Trust Advisors L.P., an
affiliate of ours. Dow Jones does not endorse, sell or promote any of
the Trusts, in particular, The Dow (sm) DART 5 Portfolio or The Dow(sm)
DART 10 Portfolio. Dow Jones makes no representation regarding the
advisability of investing in such products.
The "Nasdaq 100(registered trademark)," "Nasdaq 100 Index(registered
trademark)," and "Nasdaq(registered trademark)" are trade or service
marks of The Nasdaq Stock Market, Inc. (which with its affiliates are
the "Corporations") and are licensed for use by us. The Nasdaq Target 15
Portfolio has not been passed on by the Corporations as to its legality
or suitability. The Nasdaq Target 15 Portfolio is not issued, endorsed,
sold, or promoted by the Corporations. The Corporations make no
warranties and bear no liability with respect to The Nasdaq Target 15
Portfolio.
"S&P," "S&P 500," and "Standard & Poor's" are trademarks of The McGraw-
Hill Companies, Inc. and have been licensed for use by us. The S&P
Target 10 Portfolio is not sponsored, endorsed, sold or promoted by
Standard & Poor's and Standard & Poor's makes no representation
regarding the advisability of investing in such Trust. Please see the
Information Supplement which sets forth certain additional disclaimers
and limitations of liabilities on behalf of Standard & Poor's.
Page 17
Risk Factors
Price Volatility. The Trusts invest in common stocks. The value of a
Trust's Units will fluctuate with changes in the value of these common
stocks. Common stock prices fluctuate for several reasons including
changes in investors' perceptions of the financial condition of an
issuer or the general condition of the relevant stock market, or when
political or economic events affecting the issuers occur.
Because the Trusts are not managed, the Trustee will not sell stocks in
response to or in anticipation of market fluctuations, as is common in
managed investments. As with any investment, we cannot guarantee that
the performance of any Trust will be positive over any period of time or
that you won't lose money. Units of the Trusts are not deposits of any
bank and are not insured or guaranteed by the Federal Deposit Insurance
Corporation or any other government agency.
Trusts which use dividend yield as a selection criteria employ a
contrarian strategy in which the Securities selected share qualities
that have caused them to have lower share prices or higher dividend
yields than other common stocks in their peer group. There is no
assurance that negative factors affecting the share price or dividend
yield of these Securities will be overcome over the life of the Trusts
or that these Securities will increase in value.
Dividends. There is no guarantee that the issuers of the Securities will
declare dividends in the future or that if declared they will either
remain at current levels or increase over time.
Securities Selection. Please note that we applied each strategy which
makes up the portfolio for each Trust at a particular time. If we create
additional Units of a Trust after the Initial Date of Deposit we will
deposit the Securities originally selected by applying the strategy at
such time. This is true even if a later application of a strategy would
have resulted in the selection of different securities.
Retail Industry. Because more than 25% of The S&P Target 10 Portfolio is
invested in common stocks of companies in the retail industry, this
Trust is considered to be concentrated in this industry. A portfolio
concentrated in an industry may present more risk than a portfolio
broadly diversified over several industries. General risks of these
companies include the general state of the economy, intense competition
and consumer spending trends. A decline in the economy which results in
a reduction of consumers' disposable income can negatively impact
spending habits. Competitiveness in the retail industry will require
large capital outlays for the installation of automated checkout
equipment to control inventory, track the sale of items and gauge the
success of sales campaigns. Retailers who sell their products over the
Internet have the potential to access more consumers, but will require
sophisticated technology to remain competitive.
Financial Institutions Industry. The European Target 20 Portfolio is
considered to be concentrated in the stock of financial institutions.
Such institutions are especially subject to the adverse effects of
economic recession; volatile interest rates; portfolio concentrations
in geographic markets and in commercial and residential real estate
loans; and competition from new entrants in their fields of business.
In addition, financial institutions are extensively regulated and may
be adversely affected by increased or changing regulations.
Financial institutions face increased competition from nontraditional
lending sources as regulatory changes permit new entrants to offer
various financial products. Technological advances such as the Internet
allow these nontraditional lending sources to cut overhead and permit
the more efficient use of customer data.
Technology Industry. The Nasdaq Target 15 Portfolio is considered to be
concentrated in technology stocks. Technology companies are generally
subject to the risks of rapidly changing technologies; short product
life cycles; fierce competition; aggressive pricing; frequent
introduction of new or enhanced products; the loss of patent, copyright
and trademark protections; and government regulation. Technology
companies may be smaller and less experienced companies, with limited
product lines, markets or financial resources. Technology company stocks
have experienced extreme price and volume fluctuations that are often
unrelated to their operating performance.
Legislation/Litigation. From time to time, various legislative
initiatives are proposed in the United States and abroad which may have
a negative impact on certain of the companies represented in the Trusts.
In addition, litigation regarding any of the issuers of the Securities,
such as that concerning Philip Morris Companies, Inc., or of the
Page 18
industries represented by these issuers may negatively impact the share
prices of these Securities. We cannot predict what impact any pending or
threatened litigation will have on the share prices of the Securities.
Year 2000 Problem. Many computer systems were not designed to properly
process information and data involving dates of January 1, 2000 and
thereafter. This is commonly known as the "Year 2000 Problem." We do not
expect that any of the computer system changes necessary to prepare for
January 1, 2000 will cause any major operational difficulties for the
Trusts. However, we are unable to predict what impact the Year 2000
Problem will have on any of the issuers of the Securities, but you
should note that foreign issuers may have greater difficulties than
other issuers.
Foreign Stocks. All of the Securities in the European Target 20
Portfolio are issued by foreign companies, which makes the Trust subject
to more risks than if it invested solely in domestic common stocks.
Risks of foreign common stocks include higher brokerage costs; different
accounting standards; expropriation, nationalization or other adverse
political or economic developments; currency devaluations, blockages or
transfer restrictions; restrictions on foreign investments and exchange
of securities; inadequate financial information; lack of liquidity of
certain foreign markets; and less government supervision and regulation
of exchanges, brokers, and issuers in foreign countries.
The purchase and sale of the foreign Securities will generally occur
only in foreign securities markets. Although we do not believe that the
Trust will have problems buying and selling these Securities, certain of
the factors stated above may make it impossible to buy or sell them in a
timely manner. Custody of certain of the Securities in the European
Target 20 Portfolio is maintained by Cedel Bank S.A., a global custody
and clearing institution which has entered into a sub-custodian
relationship with the Trustee.
United Kingdom. The European Target 20 Portfolio is considered to be
concentrated in common stocks of U.K. issuers. The United Kingdom is one
of 15 members of the European Union ("EU") which was formed by the
Maastricht Treaty on European Union. It is expected that the Treaty will
have the effect of eliminating most remaining trade barriers between the
member nations and make Europe one of the largest common markets in the
world. However, the uncertain implementation of the Treaty provisions
and recent rapid political and social change throughout Europe make the
extent and nature of future economic development in the United Kingdom
and Europe and their effect on Securities issued by U.K. issuers
impossible to predict.
Unlike a majority of EU members, the United Kingdom did not convert its
currency to the new common European currency, the euro, on January 1,
1999. All companies with significant markets or operations in Europe
face strategic challenges as these entities adapt to a single currency.
The euro conversion may materially impact revenues, expenses or income;
increase competition; affect issuers' currency exchange rate risk and
derivatives exposure; cause issuers to increase spending on information
technology updates; and result in potentially adverse tax consequences.
We cannot predict when or if the United Kingdom will convert to the euro
or what impact the implementation of the euro throughout a majority of
EU countries will have on U.K. or European issuers.
Exchange Rates. Because securities of foreign issuers generally pay
dividends and trade in foreign currencies, the U.S. dollar value of
these Securities (and therefore Units of the European Target 20
Portfolio) will vary with fluctuations in foreign exchange rates. Most
foreign currencies have fluctuated widely in value against the U.S.
dollar for various economic and political reasons. The recent conversion
by eleven of the fifteen EU members of their national currencies to the
euro could negatively impact the market rate of exchange between such
currencies (or the newly created euro) and the U.S. dollar.
To determine the value of foreign Securities or their dividends, the
Evaluator will estimate current exchange rates for the relevant
currencies based on activity in the various currency exchange markets.
However, these markets can be quite volatile, depending on the activity
of the large international commercial banks, various central banks,
large multi-national corporations, speculators and other buyers and
sellers of foreign currencies. Since actual foreign currency
transactions may not be instantly reported, the exchange rates estimated
by the Evaluator may not reflect the amount the European Target 20
Portfolio would receive, in U.S. dollars, had the Trustee sold any
particular currency in the market.
Page 19
Hypothetical Performance Information
The following table compares hypothetical performance information for
the strategies employed by each Trust and the actual performance of the
DJIA, S&P 500 Index, Nasdaq 100 Index and MSCI Europe Index in each of
the full years listed below (and as of the most recent quarter).
These hypothetical returns should not be used to predict future
performance of the Trusts. Returns from a Trust will differ from its
strategy for several reasons, including the following:
- - Total Return figures shown do not reflect sales charges, commissions,
Trust expenses or taxes.
- - Strategy returns are for calendar years (and through the most recent
quarter), while the Trusts begin and end on various dates.
- - Trusts may not be fully invested at all times or equally weighted in
all stocks comprising a strategy.
- - Securities are often purchased or sold at prices different from the
closing prices used in buying and selling Units.
- - For Trusts investing in foreign Securities, currency exchange rates
may differ.
You should note that the Trusts are not designed to parallel movements
in any index, and it is not expected that they will do so. In fact, each
Trust's strategy underperformed its comparative index in certain years
and we cannot guarantee that a Trust will outperform its respective
index over the life of a Trust or over consecutive rollover periods, if
available. Each index differs widely in size and focus, as described
below.
DJIA. The DJIA consists of 30 U.S. stocks chosen by the editors of The
Wall Street Journal as being representative of the broad market and of
American industry. Changes in the component stocks of the DJIA are made
entirely by the editors of The Wall Street Journal without consulting
the companies, the stock exchange or any official agency. For the sake
of continuity, changes are made rarely. Effective November 1, 1999, Home
Depot Inc., Microsoft Corporation, Intel Corporation and SBC
Communications Inc. were added to the DJIA, replacing Chevron
Corporation, Goodyear Tire & Rubber Company, Sears, Roebuck & Company
and Union Carbide Corporation.
S&P 500 Index. The S&P 500 Index consists of 500 stocks chosen by
Standard and Poor's to be representative of the leaders of various
industries.
Nasdaq 100 Index. The NASDAQ 100 Index consists of the 100 largest non-
financial companies listed on the NASDAQ National Market System. As of
December 18, 1998, the constituents are constructed using a modified
market capitalization approach.
MSCI Europe Index. The MSCI Europe Index is an equity market
capitalization weighted index consisting of over 500 companies from all
of the developed markets in Europe.
Page 20
<TABLE>
<CAPTION>
COMPARISON OF TOTAL RETURN (2)
Hypothetical Strategy Total Returns (1) Index Total Returns
_______________________________________ ___________________
The The
Dow (sm) Dow (sm) European The S&P The Nasdaq MSCI
DART 5 DART 10 Target 20 Target 10 Target 15 Europe S&P 500 Nasdaq
Year Strategy Strategy Strategy Strategy Strategy DJIA Index Index 100 Index
____ ________ ________ _________ ________ _________ _____ _________ __________ _________
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1972 18.16% 23.76% 18.38%
1973 10.84% -2.26% -13.20%
1974 2.22% -7.11% -23.64%
1975 47.74% 57.78% 44.46%
1976 30.10% 35.18% 22.80%
1977 3.37% -1.95% -12.91%
1978 11.00% -1.95% 2.66%
1979 17.64% 13.01% 43.17% 10.60% 18.22%
1980 44.01% 24.80% 54.15% 21.90% 32.11%
1981 -6.01% 2.02% -10.59% -3.61% -4.92%
1982 22.07% 27.46% 38.21% 26.85% 21.14%
1983 37.02% 40.44% 20.01% 25.82% 22.28%
1984 13.40% 6.22% 2.00% 16.34% 1.29% 1.26% 6.22%
1985 43.24% 39.31% 79.54% 43.49% 33.28% 79.79% 31.77%
1986 49.49% 41.95% 42.53% 21.81% 22.94% 27.00% 44.46% 18.31% 6.89%
1987 6.03% 5.24% 14.86% 9.16% 14.10% 5.66% 4.10% 5.33% 10.49%
1988 18.40% 19.02% 16.77% 20.35% -0.59% 16.03% 16.35% 16.64% 13.54%
1989 40.15% 28.49% 33.09% 39.62% 37.33% 32.09% 29.06% 31.35% 26.17%
1990 5.78% 1.27% -0.49% -5.64% -5.39% -0.73% -3.37% -3.30% -10.41%
1991 42.59% 43.84% 16.59% 24.64% 109.27% 24.19% 13.66% 30.40% 64.99%
1992 12.91% 8.53% -4.03% 24.66% -0.15% 7.39% -4.25% 7.62% 8.86%
1993 19.89% 21.15% 37.38% 42.16% 28.55% 16.87% 29.79% 9.95% 11.67%
1994 -5.73% 0.17% -0.51% 8.17% 10.50% 5.03% 2.66% 1.34% 1.74%
1995 46.58% 38.14% 34.71% 25.26% 53.80% 36.67% 22.13% 37.22% 43.01%
1996 35.45% 34.93% 24.35% 26.61% 60.03% 28.71% 21.57% 22.82% 42.74%
1997 21.68% 25.64% 28.91% 61.46% 35.15% 24.82% 24.20% 33.21% 20.76%
1998 27.43% 19.96% 35.77% 53.85% 123.10% 18.03% 28.80% 28.57% 85.43%
1999 12.04% 13.93% 22.11% -1.47% 32.51% 13.91% -2.43% 5.34% 31.22%
(thru
9/30)
____________
<FN>
(1) The Strategy stocks for each Strategy for a given year consist of
the common stocks selected by applying the respective Strategy as of the
beginning of the period.
(2) Total Return represents the sum of the change in market value of
each group of stocks between the first and last trading day of a period
plus the total dividends paid on each group of stocks during such period
divided by the opening market value of each group of stocks as of the
first trading day of a period. Total Return figures assume that all
dividends are reinvested semi-annually and all returns are stated in terms
of U.S. dollars. Based on the year-by-year returns contained in the table,
over the full years listed above, The Dow(sm) DART 5 Strategy, The Dow(sm)
DART 10 Strategy, European Target 20 Strategy, The S&P Target 10
Strategy and The Nasdaq Target 15 Strategy achieved an average annual
total return of 21.66%, 18.94, 22.42%, 26.40% and 32.79%, respectively.
In addition, over each stated period, each individual strategy achieved
a greater average annual total return than that of its corresponding
index, the DJIA; the MSCI Europe Index; the S&P 500 Index; and the Nasdaq
100 Index which were 13.45%, 19.05%, 17.61% and 22.60%, respectively.
</FN>
</TABLE>
Page 21
Public Offering
The Public Offering Price.
You may buy Units at the Public Offering Price, the price per Unit of
which is comprised of the following:
- - The aggregate underlying value of the Securities;
- - The amount of any cash in the Income and Capital Accounts;
- - Dividends receivable on Securities; and
- - The maximum sales charge (which consists solely of a deferred sales
charge).
The price you pay for your Units will differ from the amount stated
under "Summary of Essential Information" due to various factors,
including fluctuations in the prices of the Securities, changes in the
relevant currency exchange rates, changes in the applicable commissions,
stamp taxes, custodial fees and other costs associated with foreign
trading, and changes in the value of the Income and/or Capital Accounts.
Securities purchased with the portion of the Public Offering Price
intended to be used to reimburse the Sponsor for a Trust's organization
costs (including costs of preparing the registration statement, the
Indenture and other closing documents, registering Units with the
Securities and Exchange Commission ("SEC") and states, the initial audit
of each Trust portfolio, legal fees and the initial fees and expenses of
the Trustee) will be purchased in the same proportionate relationship as
all the Securities contained in a Trust. Securities will be sold to
reimburse the Sponsor for a Trust's organization costs at the earlier of
six months after the Initial Date of Deposit or the end of the initial
offering period (a significantly shorter time period than the life of
the Trusts). During the period ending with the earlier of six months
after the Initial Date of Deposit or the end of the initial offering
period, there may be a decrease in the value of the Securities. To the
extent the proceeds from the sale of these Securities are insufficient
to repay the Sponsor for Trust organization costs, the Trustee will sell
additional Securities to allow a Trust to fully reimburse the Sponsor.
In that event, the net asset value per Unit of a Trust will be reduced
by the amount of additional Securities sold. Although the dollar amount
of the reimbursement due to the Sponsor will remain fixed and will never
exceed the per Unit amount set forth for a Trust in "Statements of Net
Assets," this will result in a greater effective cost per Unit to Unit
holders for the reimbursement to the Sponsor. To the extent actual
organization costs are less than the estimated amount, only the actual
organization costs will be deducted from the assets of a Trust. When
Securities are sold to reimburse the Sponsor for organization costs, the
Trustee will sell Securities, to the extent practicable, which will
maintain the same proportionate relationship among the Securities
contained in a Trust as existed prior to such sale.
Although you are not required to pay for your Units until the business
day following your order (the "date of settlement"), you may pay before
then. You will become the owner of Units ("Record Owner") on the date of
settlement if payment has been received. If you pay for your Units
before the date of settlement, we may use your payment during this time
and it may be considered a benefit to us, subject to the limitations of
the Securities Exchange Act of 1934.
Sales Charges.
The maximum sales charge is entirely deferred. The deferred sales charge
for each Trust is a fixed dollar amount equal to approximately $.0083
per Unit per month (approximately $.0084 per Unit per month in the case
of The Dow sm DART 5 Portfolio) and will be deducted from a Trust's
assets on approximately the twentieth day of each month over the life of
a Trust. If you purchase Units after the initial deferred sales charge
payment, you will only be subject to any remaining deferred sales charge
payments. At the Public Offering Price per Unit for each Trust set forth
in "Summary of Essential Information," the maximum sales charge equals
1.0% of the Public Offering Price. The maximum sales charge will vary
from 1.0% with changes in the Public Offering Price but in no case will
it exceed 1.3% of the Public Offering Price (equivalent to 1.3% of the
net amount invested, exclusive of the deferred sales charge).
The Value of the Securities.
The Evaluator will appraise the aggregate underlying value of the
Securities in a Trust as of the Evaluation Time on each business day and
will adjust the Public Offering Price of the Units according to this
valuation. This Public Offering Price will be effective for all orders
received before the Evaluation Time on each such day. If we or the
Page 22
Trustee receive orders for purchases, sales or redemptions after that
time, or on a day which is not a business day, they will be held until
the next determination of price. The term "business day" as used in this
prospectus will exclude Saturdays, Sundays and certain national holidays
on which the NYSE is closed.
The aggregate underlying value of the Securities in a Trust will be
determined as follows: if the Securities are listed on a securities
exchange or The Nasdaq Stock Market, their value is generally based on
the closing sale prices on that exchange or system (unless it is
determined that these prices are not appropriate as a basis for
valuation). However, if there is no closing sale price on that exchange
or system, they are valued based on the closing ask prices. If the
Securities are not so listed, or, if so listed and the principal market
for them is other than on that exchange or system, their value will
generally be based on the current ask prices on the over-the-counter
market (unless it is determined that these prices are not appropriate as
a basis for valuation). If current ask prices are unavailable, the
valuation is generally determined:
a) On the basis of current ask prices for comparable securities;
b) By appraising the value of the Securities on the ask side of the
market; or
c) By any combination of the above.
The aggregate underlying value of the Securities in the European Target
20 Portfolio 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 initial offering period is over, the aggregate underlying
value of the Securities will be determined as set forth above, except
that bid prices are used instead of ask prices when necessary. In
addition, during this period the aggregate underlying value of the
Securities is computed on the basis of the bid side value of the
relevant currency exchange rate expressed in U.S. dollars as of the
Evaluation Time.
Distribution of Units
We intend to qualify Units of the Trusts for sale in a number of states.
All Units will be sold at the then current Public Offering Price.
Dealer Concessions.
Dealers and others can purchase Units at prices which represent a
concession or agency commission of up to $.004 per Unit.
We reserve the right to change the amount of concessions or agency
commissions from time to time. If we reacquire, or the Trustee redeems,
Units from brokers, dealers or other selling agents while a market is being
maintained for such Units, such entities agree to immediately repay to
us any concession or agency commission relating to the 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 kept by or given to the banks in the amounts shown
above.
Award Programs.
From time to time we may sponsor programs which provide awards to a
dealer's registered representatives who have sold a minimum number of
Units during a specified time period. We may also pay fees to qualifying
dealers for services or activities which are meant to result in sales of
Units of the Trusts. In addition, we will pay to dealers who sponsor
sales contests or recognition programs that conform to our criteria, or
participate in our sales programs, amounts equal to no more than the
total applicable sales charge on Units sold by such persons during such
programs. We make these payments out of our own assets and not out of
Trust assets. These programs will not change the price you pay for your
Units.
Page 23
Investment Comparisons.
From time to time we may compare the estimated returns of a Trust (which
may show performance net of the expenses and charges a Trust would have
incurred) and returns over specified periods of other similar trusts we
sponsor in our advertising and sales materials, with (1) returns on
other taxable investments such as the common stocks comprising various
market indices, corporate or U.S. Government bonds, bank CDs and money
market accounts or funds, (2) performance data from Morningstar
Publications, Inc. or (3) information from publications such as Money,
The New York Times, U.S. News and World Report, BusinessWeek, Forbes or
Fortune. The investment characteristics of each Trust differ from other
comparative investments. You should not assume that these performance
comparisons will be representative of a Trust's future performance.
The Sponsor's Profits
We will receive a gross sales commission equal to the maximum sales
charge per Unit for each Trust as stated in "Public Offering." Also, any
difference between our cost to purchase the Securities and the price at
which we sell them to a Trust is considered a profit or loss (see Note 2
of "Notes to Schedules of Investments"). During the initial offering
period, dealers and others may also realize profits or sustain losses as
a result of fluctuations in the Public Offering Price they receive when
they sell the Units.
In maintaining a market for Units, any difference between the price at
which we purchase Units and the price at which we sell or redeem them
will be a profit or loss to us.
The Secondary Market
Although not obligated, we intend to maintain a market for the Units
after the initial offering period and continuously offer to purchase
Units at prices based on the Redemption Price per Unit.
We will pay all expenses to maintain a secondary market, except the
Evaluator fees and costs to transfer and record the ownership of
Units, if any. We may discontinue purchases of Units at any time. IF YOU
WISH TO DISPOSE OF YOUR UNITS, YOU SHOULD ASK US FOR THE CURRENT MARKET
PRICES BEFORE MAKING A TENDER FOR REDEMPTION TO THE SHAREHOLDER
SERVICING AGENT.
How We Purchase Units
The Shareholder Servicing Agent will notify us of any tender of Units for
redemption. If our bid is equal to or greater than the Redemption Price per
Unit, we may purchase the Units. You will receive your proceeds from the
sale no later than if they were redeemed by the Trustee. We may tender
Units we hold to the Trustee for redemption as any other Units. If we elect
not to purchase Units, the Shareholder Servicing Agent or Trustee may sell
tendered Units in the over-the-counter market, if any. However, the amount
you will receive is the same as you would have received on redemption of the
Units.
Expenses and Charges
The estimated annual expenses of the Trusts are listed under "Fee
Table." If actual expenses of a Trust exceed the estimate, that Trust
will bear the excess. The Trustee will pay operating expenses of the
Trusts from the Income Account of a Trust if funds are available, and
then from the Capital Account. The Income and Capital Accounts are
noninterest-bearing to Unit holders, so the Trustee may earn interest on
these funds, thus benefiting from their use.
As Sponsor, we will be compensated for providing bookkeeping and other
administrative services to the Trusts, and will receive brokerage fees
when a Trust uses us (or an affiliate of ours) as agent in buying or
selling Securities. First Trust Advisors L.P., an affiliate of ours,
acts as both Portfolio Supervisor and Evaluator to the Trusts and will
receive the fees set forth under "Fee Table" for providing portfolio
supervisory and evaluation services to the Trusts. In providing
portfolio supervisory services, the Portfolio Supervisor may purchase
research services from a number of sources, which may include
underwriters or dealers of the Trusts.
The fees payable to us, First Trust Advisors L.P. and the Trustee are
based on the largest aggregate number of Units of a Trust outstanding at
any time during the calendar year, except during the initial offering
period for our fees and First Trust Advisors' fees, in which case these
Page 24
fees are calculated based on the largest number of Units outstanding
during the period for which compensation is paid. The fees payable to
the Shareholder Servicing Agent are assessed on a per Trust basis. Each
of these fees may be adjusted for inflation without Unit holders'
approval, but in no case will the annual fee paid to us or our
affiliates for providing a given service to all unit investment trusts
for which we provide such services be more than the actual cost of
providing such service in such year.
In addition to a Trust's operating expenses, and the fees described
above, the Trusts may also incur the following charges:
- - A quarterly license fee (which will fluctuate with a Trust's net
asset value) payable by certain of the Trusts for the use
of certain trademarks and trade names of Dow Jones, Standard & Poor's or
The Nasdaq Stock Market, Inc.;
- - All legal expenses of the Trustee according to its responsibilities
under the Indenture;
- - The expenses and costs incurred by the Trustee to protect a Trust and
your rights and interests;
- - Fees for any extraordinary services the Trustee performed under the
Indenture;
- - Payment for any loss, liability or expense the Trustee incurred
without negligence, bad faith or willful misconduct on its part, in
connection with its acceptance or administration of a Trust;
- - Payment for any loss, liability or expenses we incurred without
negligence, bad faith or willful misconduct in acting as Depositor of a
Trust;
- - Foreign custodial and transaction fees, if any; and/or
- - All taxes and other government charges imposed upon the Securities or
any part of a Trust.
The above expenses and the Trustee's annual fee are secured by a lien on
a Trust. Since the Securities are all common stocks and dividend income
is unpredictable, we cannot guarantee that dividends will be sufficient
to meet any or all expenses of a Trust. If there is not enough cash in
the Income or Capital Accounts of a Trust, the Trustee has the power to
sell Securities in a Trust to make cash available to pay these charges.
Any compensation or other consideration we or our affiliates receive on
Units held in Eligible Plans offered to employees of ours or our
affiliates will be remitted to such Eligible Plans to the extent the
receipt of such compensation or other consideration by us or our
affiliates is not permitted by ERISA.
Tax Status
Each Trust is not an association taxable as a corporation for federal
income tax purposes. Because the Eligible Plans are exempt from tax
under Sections 501(a) or 457 of the Internal Revenue Code of 1986, as
amended, while Units are held by Eligible Plans, neither such Eligible
Plans nor any participating employee will be taxed on income from a Trust.
Under the existing income tax laws of the State and City of New York,
the Trusts are not associations taxable as corporations.
Rights of Unit Holders
Unit Ownership.
The Trustee will treat the Shareholder Servicing Agent as sole Record
Owner of Units on its books. The Shareholder Servicing Agent will keep a
record of all individual Unit holders on its books. It is your
responsibility to notify the Shareholder Servicing Agent when you become
Record Owner. All Units will be held in uncertificated (book-entry) form.
The Shareholder Servicing Agent will establish an account for you and
credit your account with the number of Units you purchase. Within two
business days of the issuance or transfer of Units held in
uncertificated form, the Shareholder Servicing Agent will send you:
- - A written initial transaction statement containing a description of
your Trust;
- - The number of Units issued or transferred;
- - Your name, address and Taxpayer Identification Number ("TIN");
- - A notation of any liens or restrictions of the issuer and any adverse
claims; and
- - The date the transfer was registered.
Unit Holder Reports.
In connection with each distribution, the Shareholder Servicing Agent
will provide you with a statement detailing the per Unit amount of
income (if any) distributed. After the end of each calendar year, the
Shareholder Servicing Agent will provide Eligible Plans with the
following information:
Page 25
- - A summary of transactions in your Trust for the year;
- - A list of any Securities sold during the year and the Securities held
at the end of that year by your Trust;
- - The Redemption Price per Unit, computed on the 31st day of December of
such year (or the last business day before); and
- - Amounts of income and capital distributed during the year.
You may request from the Shareholder Servicing Agent copies of the
evaluations of the Securities as prepared by the Evaluator.
Income and Capital Distributions
You are eligible to receive distributions on your Units only after you
become a Record Owner. The Trustee will credit dividends received on a
Trust's Securities to the Income Account of such Trust. All other
receipts, such as return of capital, are credited to the Capital Account
of such Trust.
The Trustee will distribute any net income in the Income Account as part
of the final liquidation distribution in the case of Rollover Unit
holders and others. The Trustee will also distribute amounts in the
Capital Account as part of the final liquidation distribution in the
case of Rollover Unit holders and others. No income distribution will
be paid if accrued expenses of a Trust exceed amounts in the Income
Account. Distribution amounts will vary with changes in a Trust's fees
and expenses, in dividends received and with the sale of Securities. For
purposes of distributions, the Record Date shall be the Mandatory
Termination Date and Unit holders on the Record Date shall receive
distributions as part of the final liquidation distribution (the
"Distribution Date").
We anticipate that there will be enough money in the Capital Account of
a Trust to pay the deferred sales charge. If not, the Trustee may sell
Securities to meet the shortfall.
The Trustee may establish reserves (the "Reserve Account") within a
Trust to cover anticipated state and local taxes or any governmental
charges to be paid out of that Trust.
Redeeming Your Units
Each Eligible Plan may redeem all or a portion of its Units at any time
by sending a request for redemption to the Shareholder Servicing Agent,
who will forward such information to the Trustee. The redemption request
must be properly endorsed with proper instruments of transfer and
signature guaranteed by an eligible institution. No redemption fee will
be charged, but you are responsible for any governmental charges that
apply. One business day after the day you tender your Units (the
"Date of Tender") you will receive cash in an amount for each Unit equal
to the Redemption Price per Unit calculated at the Evaluation Time on
the Date of Tender.
The Date of Tender is considered to be the date on which the Shareholder
Servicing Agent receives your redemption request (if such day is a day the
NYSE is open for trading). However, if your redemption request is received
after 4:00 p.m. Eastern time (or after any earlier closing time on a day
on which the NYSE is scheduled in advance to close at such earlier time),
the Date of Tender is the next day the NYSE is open for trading.
Any amounts paid on redemption representing income will be withdrawn
from the Income Account of a Trust if funds are available for that
purpose, or from the Capital Account. All other amounts paid on
redemption will be taken from the Capital Account of a Trust.
The Trustee may sell Securities of a Trust to make funds available for
redemption. If Securities are sold, the size and diversification of a
Trust will be reduced. These sales may result in lower prices than if
the Securities were sold at a different time.
Your right to redeem Units (and therefore, your right to receive
payment) may be delayed:
- - If the NYSE is closed (other than customary weekend and holiday
closings);
- - If the SEC determines that trading on the NYSE is restricted or that
an emergency exists making sale or evaluation of the Securities not
reasonably practical; or
- - For any other period permitted by SEC order.
The Trustee is not liable to any person for any loss or damage which may
result from such a suspension or postponement.
The Redemption Price.
The Redemption Price per Unit is determined by the Trustee by:
adding
1. cash in the Income and Capital Accounts of a Trust not designated to
Page 26
purchase Securities;
2. the aggregate underlying value of the Securities held in that Trust;
and
3. dividends receivable on the Securities trading ex-dividend as of the
date of computation; and
deducting
1. any applicable taxes or governmental charges that need to be paid out
of such Trust;
2. any amounts owed to the Trustee for its advances;
3. estimated accrued expenses of such Trust, if any;
4. cash held for distribution to Unit holders of record of such Trust as
of the business day before the evaluation being made;
5. liquidation costs for foreign Securities, if any; and
6. other liabilities incurred by such Trust; and
dividing
1. the result by the number of outstanding Units of such Trust.
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 organization costs as set forth under "Fee Table."
Investing in a New Trust
Each Trust's portfolio has been selected on the basis of capital
appreciation potential for a limited time period. When each Trust is
about to terminate, you may have the option to roll your proceeds into
the next series of a Trust (the "New Trusts") if one is available. We
intend to create the New Trusts in conjunction with the termination of
the Trusts and plan to apply the same strategy we used to select the
portfolio for the Trusts to the New Trusts.
If your Eligible Plan assets are invested in Units of a Trust on the
Mandatory Termination Date set forth under "Summary of Essential
Information" (a "Rollover Unit holder"), the Trustee, acting in its
capacity as Distribution Agent, will redeem such Units and reinvest the
proceeds into a New Trust, provided such New Trust is offered and Units
are available. If you no longer wish to have your Eligible Plan assets
invested in a Trust you can change your Eligible Plan allocation
instructions at any time as permitted by your Eligible Plan. As a
Rollover Unit holder, your Units will be redeemed and the underlying
Securities sold by the Distribution Agent on the Mandatory Termination
Date. The Distribution Agent may engage us or other brokers as its agent
to sell the Securities.
Once all of the Securities are sold, your proceeds, less any brokerage
fees, governmental charges or other expenses involved in the sales, will
be used to buy units of a New Trust or trust with a similar investment
strategy that you have selected, provided such trusts are registered and
being offered. Accordingly, proceeds may be uninvested for up to several
days. Units purchased with rollover proceeds will generally be purchased
subject only to the maximum remaining deferred sales charge on such units.
We intend to create New Trust units as quickly as possible, depending on
the availability of the Securities contained in a New Trust's portfolio.
Rollover Unit holders will be given first priority to purchase New Trust
units. We cannot, however, assure the exact timing of the creation of
New Trust units or the total number of New Trust units we will create.
Any proceeds not invested on behalf of Rollover Unit holders in New
Trust units will be distributed within a reasonable time after such
occurrence. Although we believe that enough New Trust units can be
created, monies in a New Trust may not be fully invested on the next
business day.
If you elect not to participate as a Rollover Unit holder ("Remaining
Unit holders"), you will not be charged any additional sales charge due
to the Special Redemption and Liquidation Period. We may modify, amend
or terminate this rollover option upon 60 days notice.
Removing Securities from a Trust
The portfolios of the Trusts are not managed. However, we may, but are
not required to, direct the Trustee to dispose of a Security in certain
limited circumstances, including situations in which:
- - The issuer of the Security defaults in the payment of a declared
dividend;
- - Any action or proceeding prevents the payment of dividends;
- - There is any legal question or impediment affecting the Security;
- - The issuer of the Security has breached a covenant which would affect
Page 27
the payment of dividends, the issuer's credit standing, or otherwise
damage the sound investment character of the Security;
- - The issuer has defaulted on the payment of any other of its
outstanding obligations; or
- - The price of the Security has declined to such an extent, or such
other credit factors exist, that in our opinion keeping the Security
would be harmful to a Trust.
Except in the limited instance in which a Trust acquires Replacement
Securities, as described in "The FT Series," a Trust may not acquire any
securities or other property other than the Securities. The Trustee, on
behalf of a Trust, will reject any offer for new or exchanged securities
or property in exchange for a Security, such as those acquired in a
merger or other transaction. If such exchanged securities or property
are nevertheless acquired by a Trust, at our instruction they will
either be sold or held in such Trust. In making the determination as to
whether to sell or hold the exchanged securities or property we may get
advice from the Portfolio Supervisor. Any proceeds received from the
sale of Securities, exchanged securities or property will be credited to
the Capital Account of a Trust for distribution to Unit holders or to
meet redemption requests. The Trustee may retain and pay us or an
affiliate of ours to act as agent for the Trusts to facilitate selling
Securities, exchanged securities or property from the Trusts. If we or
our affiliate act in this capacity, we will be held subject to the
restrictions under the Investment Company Act of 1940, as amended.
The Trustee may sell Securities designated by us, or, absent our
direction, at its own discretion, in order to meet redemption requests
or pay expenses. In designating Securities to be sold, we will try to
maintain the proportionate relationship among the Securities. If this is
not possible, the composition and diversification of a Trust may be
changed. To get the best price for a Trust we may specify minimum
amounts (generally 100 shares) in which blocks of Securities are to be
sold. We may consider sales of Units of unit investment trusts which we
sponsor when we make recommendations to the Trustee as to which
broker/dealers they select to execute the Trusts' portfolio
transactions, or when acting as agent for the Trusts in acquiring or
selling Securities on behalf of the Trusts.
Amending or Terminating the Indenture
Amendments. The Indenture may be amended by us and the Trustee without
your consent:
- - To cure ambiguities;
- - To correct or supplement any defective or inconsistent provision;
- - To make any amendment required by any governmental agency; or
- - To make other changes determined not to be materially adverse to your
best interests (as determined by us and the Trustee).
Termination. As provided by the Indenture, each Trust will terminate on
the Mandatory Termination Date. A Trust may be terminated prior to the
Mandatory Termination Date:
- - Upon the consent of 100% of the Unit holders;
- - If the value of the 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 Securities deposited in such Trust during the initial offering
period ("Discretionary Liquidation Amount"); or
- - In the event that Units of a Trust not yet sold aggregating more than
60% of the Units of such Trust are tendered for redemption by
underwriters, including the Sponsor.
Prior to termination, the Trustee will send written notice to all Unit
holders which will specify how you should tender your Units. If a Trust
is terminated due to this last reason, we will refund your entire sales
charge; however, we will not refund any sales charge if a Trust is
terminated before the Mandatory Termination Date for any other stated
reason. For various reasons, including Unit holders' participation as
Rollover Unit holders, a Trust may be reduced below the Discretionary
Liquidation Amount and could therefore be terminated before the
Mandatory Termination Date.
Unless terminated earlier, the Trustee will begin to sell Securities in
connection with the termination of a Trust during the period beginning
nine business days prior to, and no later than, the Mandatory
Termination Date. We will determine the manner and timing of the sale of
Securities. Because the Trustee must sell the Securities within a
relatively short period of time, the sale of Securities as part of the
termination process may result in a lower sales price than might
Page 28
otherwise be realized if such sale were not required at this time.
If you do not elect to participate in the Rollover Option, you will
receive a cash distribution from the sale of the remaining Securities,
along with your interest in the Income and Capital Accounts, within a
reasonable time after your Trust is terminated. Regardless of the
distribution involved, the Trustee will deduct from a Trust any accrued
costs, expenses, advances or indemnities provided for by the Indenture,
including estimated compensation of the Trustee and costs of liquidation
and any amounts required as a reserve to pay any taxes or other
governmental charges.
Information on the Sponsor, Trustee, Shareholder
Servicing Agent and Evaluator
The Sponsor.
We, Nike Securities L.P., specialize in the underwriting, trading and
wholesale distribution of unit investment trusts under the "First Trust"
brand name and other securities. An Illinois limited partnership formed
in 1991, we act as Sponsor for successive series of:
- - The First Trust Combined Series
- - FT Series (formerly known as The First Trust Special Situations Trust)
- - The First Trust Insured Corporate Trust
- - The First Trust of Insured Municipal Bonds
- - The First Trust GNMA
First Trust introduced the first insured unit investment trust in 1974.
To date we have deposited more than $25 billion in First Trust unit
investment trusts. Our employees include a team of professionals with
many years of experience in the unit investment trust industry.
We are a member of the National Association of Securities Dealers, Inc.
and Securities Investor Protection Corporation. Our principal offices
are at 1001 Warrenville Road, Lisle, Illinois 60532; telephone number
(630) 241-4141. As of December 31, 1998, the total partners' capital of
Nike Securities L.P. was $18,506,548 (audited).
This information refers only to us and not to the Trusts or to any
series of the Trusts or to any other dealer. We are including this
information only to inform you of our financial responsibility and our
ability to carry out our contractual obligations. We will provide more
detailed financial information on request.
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. If you have questions regarding the Trusts, you may
call the Customer Service Help Line at 1-800-682-7520. The Trustee is
supervised 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 has not participated in selecting the Securities; it only
provides administrative services.
The Shareholder Servicing Agent.
The Shareholder Servicing Agent is BISYS Fund Services Ohio, Inc. with
its principal place of business at 3435 Stelzer Road, Columbus, Ohio
43219. If you have questions regarding the Trusts, you may call the
Shareholder Servicing Agent at (800) 266-5240. The Shareholder Servicing
Agent has not participated in selecting the Securities; it only provides
administrative services.
Limitations of Liabilities of Sponsor, Shareholder Servicing Agent and
Trustee.
Neither we, the Shareholder Servicing Agent nor the Trustee will be
liable for taking any action or for not taking any action in good faith
according to the Indenture. We will also not be accountable for errors
in judgment. We will only be liable for our own willful misfeasance, bad
faith, gross negligence (ordinary negligence in the Shareholder
Servicing Agent's and Trustee's case) or reckless disregard of our
obligations and duties. The Trustee is not liable for any loss or
depreciation when the Securities are sold. If we fail to act under the
Indenture, the Trustee may do so, and the Trustee will not be liable for
any action it takes in good faith under the Indenture.
The Trustee will not be liable for any taxes or other governmental
charges or interest on the Securities which the Trustee may be required
to pay under any present or future law of the United States or of any
other taxing authority with jurisdiction. Also, the Indenture states
other provisions regarding the liability of the Trustee.
Page 29
If we do not perform any of our duties under the Indenture or are not
able to act or become bankrupt, or if our affairs are taken over by
public authorities, then the Trustee may:
- - Appoint a successor sponsor, paying them a reasonable rate not more
than that stated by the SEC;
- - Terminate the Indenture and liquidate the Trust; or
- - Continue to act as Trustee without terminating the Indenture.
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 Trustee, Sponsor, Shareholder Servicing Agent and Unit holders may
rely on the accuracy of any evaluation prepared by the Evaluator. The
Evaluator will make determinations in good faith based upon the best
available information, but will not be liable to the Trustee, Sponsor,
Shareholder Servicing Agent or Unit holders for errors in judgment.
Other Information
Legal Opinions.
Our counsel is Chapman and Cutler, 111 W. Monroe St., Chicago, Illinois,
60603. They have passed upon the legality of the Units offered hereby
and certain matters relating to federal tax law. Carter, Ledyard &
Milburn acts as the Trustee's counsel, as well as special New York tax
counsel for the Trusts.
Experts.
Ernst & Young LLP, independent auditors, have audited the Trusts'
statements of net assets, including the schedules of investments, at the
opening of business on the Initial Date of Deposit, as set forth in
their report. We've included the Trusts' statements of net assets,
including the schedules of investments, in the prospectus and elsewhere
in the registration statement in reliance on Ernst & Young LLP's report,
given on their authority as experts in accounting and auditing.
Supplemental Information.
If you write or call the Trustee, you will receive free of charge
supplemental information about this Series, which has been filed with
the SEC and to which we have referred throughout. This information
states more specific details concerning the nature, structure and risks
of this product.
Page 30
This page is intentionally left blank.
Page 31
FIRST TRUST (registered trademark)
The Dow(sm) Dividend And Repurchase
Target 5 Portfolio, Qualified 2000 Series
The Dow(sm) Dividend And Repurchase
Target 10 Portfolio, Qualified 2000 Series
European Target 20 Portfolio, Qualified 2000 Series
The Nasdaq Target 15 Portfolio, Qualified 2000 Series
The S&P Target 10 Portfolio, Qualified 2000 Series
FT 331
Sponsor:
Nike Securities L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Shareholder Servicing Agent: Trustee:
BISYS Fund Services Ohio, Inc. The Chase Manhattan Bank
3435 Stelzer Road 4 New York Plaza, 6th floor
Columbus, Ohio 43219 New York, New York 10004-2413
1-800-266-5240 1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
________________________
When Units of the Trusts are no longer available, this prospectus may be
used as a preliminary prospectus for a future series, in which case you
should note the following:
THE INFORMATION IN THE PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE
MAY NOT SELL, OR ACCEPT OFFERS TO BUY, SECURITIES OF A FUTURE SERIES
UNTIL THAT SERIES HAS BECOME EFFECTIVE WITH THE SECURITIES AND EXCHANGE
COMMISSION. NO SECURITIES CAN BE SOLD IN ANY STATE WHERE A SALE WOULD BE
ILLEGAL.
________________________
This prospectus contains information relating to the above-mentioned
unit investment trusts, but does not contain all of the information
about this investment company as filed with the Securities and Exchange
Commission in Washington, D.C. under the:
- - Securities Act of 1933 (file no. 333-88643) and
- - Investment Company Act of 1940 (file no. 811-05903)
Information about the Trusts can be reviewed and copied at the
Securities and Exchange Commission's Public Reference Room in Washington
D.C. Information regarding the operation of the Commission's Public
Reference Room may be obtained by calling the Commission at 1-202-942-
8090.
Information about the Trusts is available on the EDGAR Database on the
Commission's Internet site at
http://www.sec.gov.
To obtain copies at prescribed rates -
Write: Public Reference Section of the Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0102
e-mail address: [email protected]
December 30, 1999
PLEASE RETAIN THIS PROSPECTUS FOR FUTURE REFERENCE
Page 32
First Trust (registered trademark)
The FT Series
Information Supplement
This Information Supplement provides additional information concerning
the structure, operations and risks of the unit investment trust
contained in FT 331 not found in the prospectus for the Trust. This
Information Supplement is not a prospectus and does not include all of
the information you should consider before investing in the Trust. This
Information Supplement should be read in conjunction with the prospectus
for the Trust in which you are considering investing.
This Information Supplement is dated December 30, 1999. Capitalized
terms have been defined in the prospectus.
<TABLE>
<CAPTION>
Table of Contents
<S> <C>
Dow Jones & Company, Inc. 1
The Nasdaq Stock Market, Inc. 2
Standard & Poor's 2
Risk Factors
Securities 3
Dividends 3
Foreign Issuers 3
United Kingdom 4
Exchange Rate 5
Litigation
Tobacco Industry 8
Concentrations
Banks and Thrifts 8
Retail Companies 10
Technology Companies 10
Portfolios
Equity Securities Selected for The Dow(sm) DART 5, Qualified 2000 Series 11
Equity Securities Selected for The Dow(sm) DART 10, Qualified 2000 Series 11
Equity Securities Selected for European Target 20 Portfolio, Qualified 2000 Series 12
Equity Securities Selected for The Nasdaq Target 15 Portfolio, Qualified 2000 Series 13
Equity Securities Selected for The S&P Target 10 Portfolio, Qualified 2000 Series 14
</TABLE>
Dow Jones & Company, Inc.
The Trusts are not sponsored, endorsed, sold or promoted by Dow Jones &
Company, Inc. ("Dow Jones"). Dow Jones makes no representation or
warranty, express or implied, to the owners of the Trusts or any member
of the public regarding the advisability of investing in securities
generally or in the Trusts particularly. Dow Jones' only relationship to
the Sponsor is the licensing of certain trademarks, trade names and
service marks of Dow Jones and of the Dow Jones Industrial Average(sm),
which is determined, composed and calculated by Dow Jones without regard
to the Sponsor or the Trusts. Dow Jones has no obligation to take the
needs of the Sponsor or the owners of the Trusts into consideration in
determining, composing or calculating the Dow Jones Industrial
Average(sm). Dow Jones is not responsible for and has not participated
in the determination of the timing of, prices at, or quantities of the
Trusts to be issued or in the determination or calculation of the
equation by which the Trusts are to be converted into cash. Dow Jones
has no obligation or liability in connection with the administration,
marketing or trading of the Trusts.
DOW JONES DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE
DOW JONES INDUSTRIAL AVERAGE(SM) OR ANY DATA INCLUDED THEREIN AND DOW
JONES SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR
INTERRUPTIONS THEREIN. DOW JONES MAKES NO WARRANTY, EXPRESS OR IMPLIED,
Page 1
AS TO RESULTS TO BE OBTAINED BY THE SPONSOR, OWNERS OF THE TRUSTS, OR
ANY OTHER PERSON OR ENTITY FROM THE USE OF THE DOW JONES INDUSTRIAL
AVERAGE(SM) OR ANY DATA INCLUDED THEREIN. DOW JONES MAKES NO EXPRESS OR
IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES, OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT
TO THE DOW JONES INDUSTRIAL AVERAGE(SM) OR ANY DATA INCLUDED THEREIN.
WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL DOW JONES HAVE
ANY LIABILITY FOR ANY LOST PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR
CONSEQUENTIAL DAMAGES, EVEN IF NOTIFIED OF THE POSSIBILITY THEREOF.
The Nasdaq Stock Market, Inc.
The Nasdaq Target 15 Portfolio Series is not sponsored, endorsed,
sold or promoted by The Nasdaq Stock Market, Inc. (including its
affiliates) (Nasdaq, with its affiliates, are referred to as the
"Corporations"). The Corporations have not passed on the legality or
suitability of, or the accuracy or adequacy of descriptions and
disclosures relating to The Nasdaq Target 15 Portfolio Series. The
Corporations make no representation or warranty, express or implied, to
the owners of Units of The Nasdaq Target 15 Portfolio Series or any
member of the public regarding the advisability of investing in
securities generally or in The Nasdaq Target 15 Portfolio Series
particularly, or the ability of the Nasdaq 100 Index(registered
trademark) to track general stock market performance. The Corporations'
only relationship to the Sponsor ("Licensee") is in the licensing of the
Nasdaq 100(registered trademark), Nasdaq 100 Index(registered trademark)
and Nasdaq(registered trademark) trademarks or service marks, and
certain trade names of the Corporations and the use of the Nasdaq 100
Index(registered trademark) which is determined, composed and calculated
by Nasdaq without regard to Licensee or The Nasdaq Target 15
Portfolio Series. Nasdaq has no obligation to take the needs of the
Licensee or the owners of Units of The Nasdaq Target 15 Portfolio Series
into consideration in determining, composing or calculating the Nasdaq
100 Index(registered trademark). The Corporations are not responsible
for and have not participated in the determination of the timing of,
prices at or quantities of The Nasdaq Target 15 Portfolio Series to be
issued or in the determination or calculation of the equation by which
The Nasdaq Target 15 Portfolio Series is to be converted into cash. The
Corporations have no liability in connection with the administration,
marketing or trading of The Nasdaq Target 15 Portfolio Series.
THE CORPORATIONS DO NOT GUARANTEE THE ACCURACY AND/OR UNINTERRUPTED
CALCULATION OF THE NASDAQ 100 INDEX(registered trademark) OR ANY DATA
INCLUDED THEREIN. THE CORPORATIONS MAKE NO WARRANTY, EXPRESS OR IMPLIED,
AS TO RESULTS TO BE OBTAINED BY THE LICENSEE, OWNERS OF THE NASDAQ
TARGET 15 PORTFOLIO SERIES, OR ANY OTHER PERSON OR ENTITY FROM THE USE
OF THE NASDAQ 100 INDEX(registered trademark) OR ANY DATA INCLUDED
THEREIN. THE CORPORATIONS MAKE NO EXPRESS OR IMPLIED WARRANTIES AND
EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE OR USE WITH RESPECT TO THE NASDAQ 100
INDEX(registered trademark) OR ANY DATA INCLUDED THEREIN. WITHOUT
LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL THE CORPORATIONS HAVE
ANY LIABILITY FOR ANY LOST PROFITS OR SPECIAL, INCIDENTAL, PUNITIVE,
INDIRECT OR CONSEQUENTIAL DAMAGES, EVEN IF NOTIFIED OF THE POSSIBILITY
OF SUCH DAMAGES.
Standard & Poor's
The Trusts are not sponsored, endorsed, sold or promoted by Standard &
Poor's, a division of The McGraw-Hill Companies, Inc. ("S&P"). S&P makes
no representation or warranty, express or implied, to the owners of the
Trusts or any member of the public regarding the advisability of
investing in securities generally or in the Trusts particularly or the
ability of the S&P 500 Index to track general stock market performance.
S&P's only relationship to the licensee is the licensing of certain
trademarks and trade names of S&P and of the S&P 500 Index, which is
determined, composed and calculated by S&P without regard to the
licensee or the Trusts. S&P has no obligation to take the needs of the
licensee or the owners of the Trusts into consideration in determining,
composing or calculating the S&P 500 Index. S&P is not responsible for
and has not participated in the determination of the prices and amount
of the Trusts or the timing of the issuance or sale of the Trusts or in
the determination or calculation of the equation by which the Trusts are
Page 2
to be converted into cash. S&P has no obligation or liability in
connection with the administration, marketing or trading of the Trusts.
S&P DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE S&P
500 INDEX OR ANY DATA INCLUDED THEREIN AND S&P SHALL HAVE NO LIABILITY
FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. S&P MAKES NO
WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY THE
LICENSEE, OWNERS OF THE TRUSTS, OR ANY OTHER PERSON OR ENTITY FROM THE
USE OF THE S&P 500 INDEX OR ANY DATA INCLUDED THEREIN. S&P MAKES NO
EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES,
OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH
RESPECT TO THE S&P 500 INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT
LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL S&P HAVE ANY LIABILITY
FOR ANY SPECIAL, PUNITIVE, INDIRECT OR CONSEQUENTIAL DAMAGES (INCLUDING
LOST PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY THEREOF.
Risk Factors
Securities. An investment in Units should be made with an understanding
of the risks which an investment in common stocks entails, including the
risk that the financial condition of the issuers of the Securities or
the general condition of the relevant stock market may worsen, and the
value of the Securities and therefore the value of the Units may
decline. Common stocks are especially susceptible to general stock
market movements and to volatile increases and decreases of value, as
market confidence in and perceptions of the issuers change. These
perceptions are based on unpredictable factors, including expectations
regarding government, economic, monetary and fiscal policies, inflation
and interest rates, economic expansion or contraction, and global or
regional political, economic or banking crises. Both U.S. and foreign
markets have experienced substantial volatility and significant declines
recently as a result of certain or all of these factors. From September
30, 1997 through October 30, 1997, amid record trading volume, the S&P
500 Index and DJIA declined 4.60% and 7.09%, respectively. In addition,
against a backdrop of continued uncertainty regarding the current global
currency crisis and falling commodity prices, during the period between
July 31, 1998 and September 30, 1998, the S&P 500 and DJIA declined by
8.97% and 11.32%, respectively.
Dividends. Shareholders of common stocks have rights to receive payments
from the issuers of those common stocks that are generally subordinate
to those of creditors of, or holders of debt obligations or preferred
stocks of, such issuers. Shareholders of common stocks of the type held
by the Trusts have a right to receive dividends only when and if, and in
the amounts, declared by the issuer's board of directors and have a
right to participate in amounts available for distribution by the issuer
only after all other claims on the issuer have been paid or provided
for. Common stocks do not represent an obligation of the issuer and,
therefore, do not offer any assurance of income or provide the same
degree of protection of capital as do debt securities. The issuance of
additional debt securities or preferred stock will create prior claims
for payment of principal, interest and dividends which could adversely
affect the ability and inclination of the issuer to declare or pay
dividends on its common stock or the rights of holders of common stock
with respect to assets of the issuer upon liquidation or bankruptcy.
Cumulative preferred stock dividends must be paid before common stock
dividends, and any cumulative preferred stock dividend omitted is added
to future dividends payable to the holders of cumulative preferred
stock. Preferred stockholders are also generally entitled to rights on
liquidation which are senior to those of common stockholders.
Foreign Issuers. Since all of the Securities included in the European
Target 20 Portfolio consist of securities of foreign issuers, an
investment in such a Trust involves certain investment risks that are
different in some respects from an investment in a trust which invests
entirely in the securities of domestic issuers. These investment risks
include future political or governmental restrictions which might
adversely affect the payment or receipt of payment of dividends on the
relevant Securities, the possibility that the financial condition of the
issuers of the Securities may become impaired or that the general
condition of the relevant stock market may worsen (both of which would
contribute directly to a decrease in the value of the Securities and
thus in the value of the Units), the limited liquidity and relatively
small market capitalization of the relevant securities market,
expropriation or confiscatory taxation, economic uncertainties and
Page 3
foreign currency devaluations and fluctuations. In addition, for foreign
issuers that are not subject to the reporting requirements of the
Securities Exchange Act of 1934, there may be less publicly available
information than is available from a domestic issuer. Also, foreign
issuers are not necessarily subject to uniform accounting, auditing and
financial reporting standards, practices and requirements comparable to
those applicable to domestic issuers. The securities of many foreign
issuers are less liquid and their prices more volatile than securities
of comparable domestic issuers. In addition, fixed brokerage commissions
and other 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. However, due to
the nature of the issuers of the Securities selected for the European
Target 20 Portfolio, the Sponsor believes that adequate information will
be available to allow the Supervisor to provide portfolio surveillance
for the Trust.
Securities issued by non-U.S. issuers generally pay dividends in foreign
currencies and are principally traded in foreign currencies. Therefore,
there is a risk that the United States dollar value of these securities
will vary with fluctuations in the U.S. dollar foreign exchange rates
for the various Securities. See "Exchange Rate" below.
On the basis of the best information available to the Sponsor at the
present time, none of the Securities in the European Target 20 Portfolio
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 Securities. However, there can be
no assurance that exchange control regulations might not be adopted in
the future which might adversely affect payment to the Trust. The
adoption of exchange control regulations and other legal restrictions
could have an adverse impact on the marketability of international
securities in the European Target 20 Portfolio and on the ability of the
Trust to satisfy their obligation to redeem Units tendered to the
Trustee for redemption. In addition, restrictions on the settlement of
transactions on either the purchase or sale side, or both, could cause
delays or increase the costs associated with the purchase and sale of
the foreign Securities and correspondingly could affect the price of the
Units.
Investors should be aware that it may not be possible to buy all
Securities at the same time because of the unavailability of any
Security, and restrictions applicable to a Trust relating to the
purchase of a Security by reason of the federal securities laws or
otherwise.
Foreign securities generally have not been registered under the
Securities Act of 1933 and may not be exempt from the registration
requirements of such Act. Sales of non-exempt Securities by a Trust in
the United States securities markets are subject to severe restrictions
and may not be practicable. Accordingly, sales of these Securities by a
Trust will generally be effected only in foreign securities markets.
Although the Sponsor does not believe that the European Target 20
Portfolio will encounter obstacles in disposing of the Securities,
investors should realize that the Securities may be traded in foreign
countries where the securities markets are not as developed or efficient
and may not be as liquid as those in the United States. The value of the
Securities will be adversely affected if trading markets for the
Securities are limited or absent.
United Kingdom. The emphasis of the United Kingdom's economy is in the
private services sector, which includes the wholesale and retail sector,
banking, finance, insurance and tourism. Services as a whole account for
a majority of the United Kingdom's gross national product and makes a
significant contribution to the country's balance of payments. The
portfolios of the International Trusts may contain common stocks of
British companies engaged in such industries as banking, chemicals,
building and construction, transportation, telecommunications and
insurance. Many of these industries may be subject to government
regulation, which may have a materially adverse effect on the
performance of their stock. In the first quarter of 1998, gross domestic
product (GDP) of the United Kingdom grew to a level 3.0% higher than in
the first quarter of 1997, however the overall rate of GDP growth has
slowed since the third quarter of 1997. The slow down largely reflects a
deteriorating trade position and higher indirect taxes. The average
quarterly rate of GDP growth in the United Kingdom (as well as in Europe
generally) has been decelerating since 1994. The United Kingdom is a
member of the European Union (the "EU") which was created through the
Page 4
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
Securities issued by United Kingdom companies impossible to predict.
A majority of the EU members converted their existing sovereign
currencies to a common currency (the "euro") on January 1, 1999. The
United Kingdom did not participate in this conversion 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. In addition, United Kingdom
companies with significant markets or operations in other European
countries (whether or not such countries are participating) 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; affect 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 Securities issued by United
Kingdom companies in the International Trusts.
Exchange Rate. The European Target 20 Portfolio is comprised totally of
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
portfolio (and hence of the Units) and of the distributions from the
portfolio 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.
The post-World War II international monetary system was, until 1973,
dominated by the Bretton Woods Treaty which established a system of
fixed exchange rates and the convertibility of the United States dollar
into gold through foreign central banks. Starting in 1971, growing
volatility in the foreign exchange markets caused the United States to
abandon gold convertibility and to effect a small devaluation of the
United States dollar. In 1973, the system of fixed exchange rates
between a number of the most important industrial countries of the
world, among them the United States and most Western European countries,
was completely abandoned. Subsequently, major industrialized countries
have adopted "floating" exchange rates, under which daily currency
valuations depend on supply and demand in a freely fluctuating
international market. Many smaller or developing countries have
continued to "peg" their currencies to the United States dollar although
there has been some interest in recent years in "pegging" currencies to
"baskets" of other currencies or to a Special Drawing Right administered
by the International Monetary Fund. In Europe, the euro has been
developed. Currencies are generally traded by leading international
commercial banks and institutional investors (including corporate
treasurers, money managers, pension funds and insurance companies). From
time to time, central banks in a number of countries also are major
buyers and sellers of foreign currencies, mostly for the purpose of
preventing or reducing substantial exchange rate fluctuations.
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,
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
Page 5
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 following tables set forth, for the periods indicated, the range of
fluctuation concerning the equivalent U.S. dollar rates of exchange and
end of month equivalent U.S. dollar rates of exchange for the United
Kingdom pound sterling and the euro:
Foreign Exchange Rates
Range of Fluctuations
in Foreign Currencies
United Kingdom
Annual Pound Sterling/
Period U.S. Dollar
_____ ____________
1983 0.616-0.707
1984 0.670-0.864
1985 0.672-0.951
1986 0.643-0.726
1987 0.530-0.680
1988 0.525-0.601
1989 0.548-0.661
1990 0.504-0.627
1991 0.499-0.624
1992 0.499-0.667
1993 0.630-0.705
1994 0.610-0.684
1995 0.610-0.653
1996 0.583-0.670
1997 0.584-0.633
1998 0.584-0.620
Source: Bloomberg L.P.
Page 6
<TABLE>
<CAPTION>
End of Month Exchange Rates End of Month Exchange Rates
for Foreign Currencies for Foreign Currencies (continued)
United Kingdom United Kingdom
Pound Sterling/ Euro/ Pound Sterling/ Euro/
Monthly Period U.S. Dollar U.S. Dollar Monthly Period U.S. Dollar U.S. Dollar
___________ ____________ ________ ____________ ____________ ________
<S> <C> <C> <C> <C> <C>
1992: December .645 N.A.
January .559 N.A. 1996:
February .569 N.A. January .661 N.A.
March .576 N.A. February .653 N.A.
April .563 N.A. March .655 N.A.
May .546 N.A. April .664 N.A.
June .525 N.A. May .645 N.A.
July .519 N.A. June .644 N.A.
August .503 N.A. July .642 N.A.
September .563 N.A. August .639 N.A.
October .641 N.A. September .639 N.A.
November .659 N.A. October .615 N.A.
December .662 N.A. November .595 N.A.
1993: December .583 N.A.
January .673 N.A. 1997:
February .701 N.A. January .624 N.A.
March .660 N.A. February .614 N.A.
April .635 N.A. March .611 N.A.
May .640 N.A. April .616 N.A.
June .671 N.A. May .610 N.A.
July .674 N.A. June .600 N.A.
August .670 N.A. July .609 N.A.
September .668 N.A. August .622 N.A.
October .676 N.A. September .619 N.A.
November .673 N.A. October .598 N.A.
December .677 N.A. November .592 N.A.
1994: December .607 N.A.
January .664 N.A. 1998:
February .673 N.A. January .613 N.A.
March .674 N.A. February .609 N.A.
April .659 N.A. March .598 N.A.
May .662 N.A. April .598 N.A.
June .648 N.A. May .613 N.A.
July .648 N.A. June .600 N.A.
August .652 N.A. July .613 N.A.
September .634 N.A. August .595 N.A.
October .611 N.A. September .589 N.A.
November .639 N.A. October .596 N.A.
December .639 N.A. November .607 N.A.
1995: December .602 N.A.
January .633 N.A. 1999:
February .631 N.A. January .608 1.136
March .617 N.A. February .624 1.103
April .620 N.A. March .621 1.076
May .630 N.A. April .621 1.057
June .627 N.A. May .624 1.042
July .626 N.A. June .634 1.035
August .645 N.A. July .617 1.071
September .631 N.A. August .623 1.056
October .633 N.A. September .607 1.068
November .652 N.A. October .608 1.055
November .626 1.009
December 29 .618 1.005
</TABLE>
Source: Bloomberg L.P.
Page 7
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
International Trusts would receive had the Trustee sold any particular
currency in the market. The foreign exchange transactions of the
International Trusts 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).
Litigation
Tobacco Industry. Certain of the issuers of Securities in certain Trusts
may be involved in the manufacture, distribution and sale of tobacco
products. Pending litigation proceedings against such issuers in the
United States and abroad cover a wide range of matters including product
liability and consumer protection. Damages claimed in such litigation
alleging personal injury (both individual and class actions), and in
health cost recovery cases brought by governments, labor unions and
similar entities seeking reimbursement for health care expenditures,
aggregate many billions of dollars.
In November 1998, certain companies in the U.S. tobacco industry entered
into a negotiated settlement with several states which would result in
the resolution of significant litigation and regulatory issues affecting
the tobacco industry generally. The proposed settlement, while extremely
costly to the tobacco industry, would significantly reduce uncertainties
facing the industry and increase stability in business and capital
markets. Future litigation and/or legislation could adversely affect the
value, operating revenues and financial position of tobacco companies.
The Sponsor is unable to predict the outcome of litigation pending
against tobacco companies or how the current uncertainty concerning
regulatory and legislative measures will ultimately be resolved. These
and other possible developments may have a significant impact upon both
the price of such Securities and the value of Units of Trusts containing
such Securities.
Concentrations
Banks and Thrifts. Certain Trusts may be considered to be concentrated
in common stocks of financial institutions. See "Risk Factors" in the
prospectus which will indicate, if applicable, a Trust's concentration
in this industry. Banks, thrifts and their holding companies are
especially subject to the adverse effects of economic recession,
volatile interest rates, portfolio concentrations in geographic markets
and in commercial and residential real estate loans, and competition
from new entrants in their fields of business. Banks and thrifts are
highly dependent on net interest margin. Recently, bank profits have
come under pressure as net interest margins have contracted, but volume
gains have been strong in both commercial and consumer products. There
is no certainty that such conditions will continue. Bank and thrift
institutions had received significant consumer mortgage fee income as a
result of activity in mortgage and refinance markets. As initial home
purchasing and refinancing activity subsided, this income diminished.
Economic conditions in the real estate markets, which have been weak in
the past, can have a substantial effect upon banks and thrifts because
they generally have a portion of their assets invested in loans secured
by real estate. Banks, thrifts and their holding companies are subject
to extensive federal regulation and, when such institutions are state-
chartered, to state regulation as well. Such regulations impose strict
capital requirements and limitations on the nature and extent of
business activities that banks and thrifts may pursue. Furthermore, bank
regulators have a wide range of discretion in connection with their
supervisory and enforcement authority and may substantially restrict the
permissible activities of a particular institution if deemed to pose
significant risks to the soundness of such institution or the safety of
the federal deposit insurance fund. Regulatory actions, such as
increases in the minimum capital requirements applicable to banks and
thrifts and increases in deposit insurance premiums required to be paid
by banks and thrifts to the Federal Deposit Insurance Corporation
("FDIC"), can negatively impact earnings and the ability of a company to
pay dividends. Neither federal insurance of deposits nor governmental
Page 8
regulations, however, insures the solvency or profitability of banks or
their holding companies, or insures against any risk of investment in
the securities issued by such institutions.
The statutory requirements applicable to and regulatory supervision of
banks, thrifts and their holding companies have increased significantly
and have undergone substantial change in recent years. To a great
extent, these changes are embodied in the Financial Institutions Reform,
Recovery and Enforcement Act; enacted in August 1989, the Federal
Deposit Insurance Corporation Improvement Act of 1991, the Resolution
Trust Corporation Refinancing, Restructuring, and Improvement Act of
1991 and the regulations promulgated under these laws. Many of the
regulations promulgated pursuant to these laws have only recently been
finalized and their impact on the business, financial condition and
prospects of the Securities in the Trust's portfolio cannot be predicted
with certainty. The recently enacted Gramm-Leach-Bliley Act repealed
most of the barriers set up by the 1933 Glass-Steagall Act which
separated the banking, insurance and securities industries. Now banks,
insurance companies and securities firms can merge to form one-stop
financial conglomerates marketing a wide range of financial products to
investors. This legislation will likely result in increased merger
activity and heightened competition among existing and new participants
in the field. Efforts to expand the ability of federal thrifts to branch
on an interstate basis have been initially successful through
promulgation of regulations, and legislation to liberalize interstate
banking which has recently been signed into law. Under the legislation,
banks will be able to purchase or establish subsidiary banks in any
state, one year after the legislation's enactment. Starting in mid-1997,
banks were allowed to turn existing banks into branches. Consolidation
is likely to continue. The Securities and Exchange Commission and the
Financial Accounting Standards Board require the expanded use of market
value accounting by banks and have imposed rules requiring market
accounting for investment securities held in trading accounts or
available for sale. Adoption of additional such rules may result in
increased volatility in the reported health of the industry, and
mandated regulatory intervention to correct such problems. In late 1993
the United States Treasury Department proposed a restructuring of the
banks regulatory agencies which, if implemented, may adversely affect
certain of the Securities in the Trust's portfolio. Additional
legislative and regulatory changes may be forthcoming. For example, the
bank regulatory authorities have proposed substantial changes to the
Community Reinvestment Act and fair lending laws, rules and regulations,
and there can be no certainty as to the effect, if any, that such
changes would have on the Securities in a Trust's portfolio. In
addition, from time to time the deposit insurance system is reviewed by
Congress and federal regulators, and proposed reforms of that system
could, among other things, further restrict the ways in which deposited
moneys can be used by banks or reduce the dollar amount or number of
deposits insured for any depositor. Such reforms could reduce
profitability as investment opportunities available to bank institutions
become more limited and as consumers look for savings vehicles other
than bank deposits. Banks and thrifts face significant competition from
other financial institutions such as mutual funds, credit unions,
mortgage banking companies and insurance companies, and increased
competition may result from legislative broadening of regional and
national interstate banking powers as has been recently enacted. Among
other benefits, the legislation allows banks and bank holding companies
to acquire across previously prohibited state lines and to consolidate
their various bank subsidiaries into one unit. The Sponsor makes no
prediction as to what, if any, manner of bank and thrift regulatory
actions might ultimately be adopted or what ultimate effect such actions
might have on a Trust's portfolio.
The Federal Bank Holding Company Act of 1956 generally prohibits a bank
holding company from (1) acquiring, directly or indirectly, more than 5%
of the outstanding shares of any class of voting securities of a bank or
bank holding company, (2) acquiring control of a bank or another bank
holding company, (3) acquiring all or substantially all the assets of a
bank, or (4) merging or consolidating with another bank holding company,
without first obtaining Federal Reserve Board ("FRB") approval. In
considering an application with respect to any such transaction, the FRB
is required to consider a variety of factors, including the potential
anti-competitive effects of the transaction, the financial condition and
future prospects of the combining and resulting institutions, the
managerial resources of the resulting institution, the convenience and
needs of the communities the combined organization would serve, the
record of performance of each combining organization under the Community
Reinvestment Act and the Equal Credit Opportunity Act, and the
prospective availability to the FRB of information appropriate to
determine ongoing regulatory compliance with applicable banking laws. In
addition, the federal Change In Bank Control Act and various state laws
Page 9
impose limitations on the ability of one or more individuals or other
entities to acquire control of banks or bank holding companies.
The FRB has issued a policy statement on the payment of cash dividends
by bank holding companies. In the policy statement, the FRB expressed
its view that a bank holding company experiencing earnings weaknesses
should not pay cash dividends which exceed its net income or which could
only be funded in ways that would weaken its financial health, such as
by borrowing. The FRB also may impose limitations on the payment of
dividends as a condition to its approval of certain applications,
including applications for approval of mergers and acquisitions. The
Sponsor makes no prediction as to the effect, if any, such laws will
have on the Securities or whether such approvals, if necessary, will be
obtained.
Retail Companies. Certain Portfolios are considered to be concentrated
in common stocks of retail companies. See "Risk Factors" in the
prospectus which will indicate, if applicable, a Trust's concentration
in this industry. The profitability of companies engaged in the retail
industry will be affected by various factors including the general state
of the economy and consumer spending trends. Recently, there have been
major changes in the retail environment due to the declaration of
bankruptcy by some of the major corporations involved in the retail
industry, particularly the department store segment. The continued
viability of the retail industry will depend on the industry's ability
to adapt and to compete in changing economic and social conditions, to
attract and retain capable management, and to finance expansion.
Weakness in the banking or real estate industry, a recessionary economic
climate with the consequent slowdown in employment growth, less
favorable trends in unemployment or a marked deceleration in real
disposable personal income growth could result in significant pressure
on both consumer wealth and consumer confidence, adversely affecting
consumer spending habits. In addition, competitiveness of the retail
industry will require large capital outlays for investment in the
installation of automated checkout equipment to control inventory, to
track the sale of individual items and to gauge the success of sales
campaigns. Increasing employee and retiree benefit costs may also have
an adverse effect on the industry. In many sectors of the retail
industry, competition may be fierce due to market saturation, converging
consumer tastes and other factors. Because of these factors and the
recent increase in trade opportunities with other countries, American
retailers are now entering global markets which entail added risks such
as sudden weakening of foreign economies, difficulty in adapting to
local conditions and constraints and added research costs.
Technology Companies. Certain Portfolios are considered to be
concentrated in common stocks of technology companies. See "Risk
Factors" in the prospectus which will indicate, if applicable, a Trust's
concentration in this industry.
Technology companies generally include companies involved in the
development, design, manufacture and sale of computers and peripherals,
software and services, data networking/communications equipment,
internet access/information providers, semiconductors and semiconductor
equipment and other related products, systems and services. The market
for these products, especially those specifically related to the
Internet, is characterized by rapidly changing technology, rapid product
obsolescence, cyclical market patterns, evolving industry standards and
frequent new product introductions. The success of the issuers of the
Securities depends in substantial part on the timely and successful
introduction of new products. An unexpected change in one or more of the
technologies affecting an issuer's products or in the market for
products based on a particular technology could have a material adverse
affect on an issuer's operating results. Furthermore, there can be no
assurance that the issuers of the Securities will be able to respond in
a timely manner to compete in the rapidly developing marketplace.
Based on trading history of common stock, factors such as announcements
of new products or development of new technologies and general
conditions of the industry have caused and are likely to cause the
market price of high-technology common stocks to fluctuate
substantially. In addition, technology company stocks have experienced
extreme price and volume fluctuations that often have been unrelated to
the operating performance of such companies. This market volatility may
adversely affect the market price of the Securities and therefore the
ability of a Unit holder to redeem Units at a price equal to or greater
than the original price paid for such Units.
Some key components of certain products of technology issuers are
currently available only from single sources. There can be no assurance
that in the future suppliers will be able to meet the demand for
Page 10
components in a timely and cost effective manner. Accordingly, an
issuer's operating results and customer relationships could be adversely
affected by either an increase in price for, or an interruption or
reduction in supply of, any key components. Additionally, many
technology issuers are characterized by a highly concentrated customer
base consisting of a limited number of large customers who may require
product vendors to comply with rigorous industry standards. Any failure
to comply with such standards may result in a significant loss or
reduction of sales. Because many products and technologies of technology
companies are incorporated into other related products, such companies
are often highly dependent on the performance of the personal computer,
electronics and telecommunications industries. There can be no assurance
that these customers will place additional orders, or that an issuer of
Securities will obtain orders of similar magnitude as past orders from
other customers. Similarly, the success of certain technology companies
is tied to a relatively small concentration of products or technologies.
Accordingly, a decline in demand of such products, technologies or from
such customers could have a material adverse impact on issuers of the
Securities.
Many technology companies rely on a combination of patents, copyrights,
trademarks and trade secret laws to establish and protect their
proprietary rights in their products and technologies. There can be no
assurance that the steps taken by the issuers of the Securities to
protect their proprietary rights will be adequate to prevent
misappropriation of their technology or that competitors will not
independently develop technologies that are substantially equivalent or
superior to such issuers' technology. In addition, due to the increasing
public use of the Internet, it is possible that other laws and
regulations may be adopted to address issues such as privacy, pricing,
characteristics, and quality of Internet products and services. For
example, recent proposals would prohibit the distribution of obscene,
lascivious or indecent communications on the Internet. The adoption of
any such laws could have a material adverse impact on the Securities in
a Trust.
Like many areas of technology, the semiconductor business environment is
highly competitive, notoriously cyclical and subject to rapid and often
unanticipated change. Recent industry downturns have resulted, in part,
from weak pricing, persistent overcapacity, slowdown in Asian demand and
a shift in retail personal computer sales toward the low end, or "sub-
$1,000" segment. Industry growth is dependent upon several factors,
including: the rate of global economic expansion; demand for products
such as personal computers and networking and communications equipment;
excess productive capacity and the resultant effect on pricing; and the
rate of growth in the market for low-priced personal computers.
Portfolios
Equity Securities Selected for The Dow(sm) DART 5 Portfolio
The Boeing Company, headquartered in Seattle, Washington, with
subsidiaries, produces and markets commercial jet transports and
provides related support services, principally to commercial customers;
and develops, produces, modifies and supports military aircraft and
helicopters and related systems, and electronic, space and missile
systems.
Eastman Kodak Company, headquartered in Rochester, New York, develops,
makes and sells consumer and commercial photographic imaging products.
The company's products include films, photographic papers and chemicals,
cameras, projectors, processing equipment, audiovisual equipment,
copiers, microfilm products, applications software, printers and other
equipment.
General Motors Corporation, headquartered in Detroit, Michigan,
manufactures and sells cars and trucks worldwide under the trademarks
"Chevrolet," "Oldsmobile," "Pontiac," "Buick," "Saturn," "Cadillac" and
"GMC Trucks."
Hewlett-Packard Company, headquartered in Palo Alto, California,
designs, makes and services equipment and systems for measurement,
computation and communications including computer systems, personal
computers, printers, calculators, electronic test equipment, medical
electronic equipment, electronic components and instrumentation for
chemical analysis.
Honeywell International Inc., headquartered in Morristown, New Jersey,
makes products for the textiles, construction, plastics, electronics,
automotive, chemicals, housing, telecommunications, utilities,
packaging, military and commercial aviation industries. The company also
provides products and services for the aerospace program.
Page 11
Equity Securities Selected for The Dow(sm) DART 10 Portfolio
The Boeing Company, headquartered in Seattle, Washington, with
subsidiaries, produces and markets commercial jet transports and
provides related support services, principally to commercial customers;
and develops, produces, modifies and supports military aircraft and
helicopters and related systems, and electronic, space and missile
systems.
Caterpillar Inc., headquartered in Peoria, Illinois, makes earthmoving,
construction and materials handling machinery and equipment and diesel
engines; and provides various financial products and services.
Eastman Kodak Company, headquartered in Rochester, New York, develops,
makes and sells consumer and commercial photographic imaging products.
The company's products include films, photographic papers and chemicals,
cameras, projectors, processing equipment, audiovisual equipment,
copiers, microfilm products, applications software, printers and other
equipment.
General Motors Corporation, headquartered in Detroit, Michigan,
manufactures and sells cars and trucks worldwide under the trademarks
"Chevrolet," "Oldsmobile," "Pontiac," "Buick," "Saturn," "Cadillac" and
"GMC Trucks."
Hewlett-Packard Company, headquartered in Palo Alto, California,
designs, makes and services equipment and systems for measurement,
computation and communications including computer systems, personal
computers, printers, calculators, electronic test equipment, medical
electronic equipment, electronic components and instrumentation for
chemical analysis.
Honeywell International Inc., headquartered in Morristown, New Jersey,
makes products for the textiles, construction, plastics, electronics,
automotive, chemicals, housing, telecommunications, utilities,
packaging, military and commercial aviation industries. The company also
provides products and services for the aerospace program.
Merck & Co., Inc., headquartered in Whitehouse Station, New Jersey, is a
leading pharmaceutical concern that discovers, develops, makes and
markets a broad range of human and animal health products and services.
The company also administers managed prescription drug programs.
J.P. Morgan & Company, Inc., headquartered in New York, New York, is a
global investment banking firm that serves clients with complex needs
through an integrated range of advisory, financing, trading, investment
and related capabilities.
Philip Morris Companies, Inc., headquartered in New York, New York, is
the world's largest producer and marketer of consumer packaged goods.
Its five principal operating companies are Kraft Foods, Inc., Miller
Brewing Company, Philip Morris International Inc., Philip Morris U.S.A.
and Philip Morris Capital Corporation.
Procter & Gamble Company, headquartered in Cincinnati, Ohio,
manufactures consumer products worldwide, including detergents, fabric
conditioners and hard surface cleaners; products for personal cleansing,
oral care, digestive health, hair and skin; paper tissue, disposable
diapers, and pharmaceuticals; and shortenings, oils, snacks, baking
mixes, peanut butter, coffee, drinks and citrus products.
Equity Securities Selected for European Target 20 Portfolio
ABN AMRO Holding NV, headquartered in Amsterdam, the Netherlands,
provides full-service banking operations both in the Netherlands and
worldwide.
Abbey National Plc, headquartered in London, England, offers personal
banking services through its locations in the United Kingdom, France,
Gibraltar, Italy, Spain and other countries worldwide.
BG Group Plc, headquartered in Berkshire, England, is an international
energy company that develops and supplies gas markets worldwide. The
company and its subsidiaries also provide exploration and production;
research and technology; and property development services.
Barclays Plc, headquartered in London, England, is a financial services
group engaged primarily in the banking and investment banking
businesses. Through its subsidiary, Barclay Bank Plc, the company offers
commercial and investment banking, insurance, financial and related
services in more than 60 countries.
CGU Plc, headquartered in London, England, is the holding company for
Commercial Union Assurance Company Plc, an international life and
property-casualty insurance operation. Through its subsidiary, the
company transacts all classes of insurance and life assurance excluding
industrial life. The company also does business in property investment
and development, loans and mortgages.
Page 12
DaimlerChrysler AG, headquartered in Stuttgart, Germany, designs,
manufactures and markets automobiles and other vehicles worldwide. The
company also provides electronics and telecommunications services as
well as aerospace, defense and financial services.
Diageo Plc, headquartered in London, England, has operations in food,
alcoholic beverages, fast food restaurants and property management. The
company markets food products under the "Pillsbury," "Haagen Dazs," and
"Green Giant" brand names; and liquor and beer products under the
"Smirnoff," "J&B Rare," "Johnnie Walker," "Jose Cuervo," "Baileys,"
"Harp" and "Guinness Stout" names. The company also owns "Burger King"
restaurants.
ENI SpA, headquartered in Rome, Italy, is a fully integrated oil and gas
company with operations worldwide. The company explores for,
distributes, refines and markets petroleum products. The company also
provides offshore oil and gas pipelaying services.
Endesa SA, headquartered in Madrid, Spain, produces, transmits,
distributes and supplies electricity to major utilities throughout Spain
and has interests in coal mining companies.
Halifax Group Plc, headquartered in Halifax, England, provides a full
range of personal financial services throughout the United Kingdom.
Hoechst AG, headquartered in Frankfurt, Germany, through subsidiaries,
manufactures pharmaceuticals, agriculture and veterinary products and
industrial chemicals. The company produces prescription drugs,
herbicides, fungicides and insecticides; animal anti-parasitic products,
antibiotics and vaccines; and basic chemicals, plastics, polymers and
industrial gases. The company markets its products worldwide.
Lloyds TSB Group Plc, headquartered in London, England, through
subsidiaries and associated companies, offers a wide range of banking
and financial services throughout the United Kingdom and a number of
other countries.
National Westminster Bank Plc, headquartered in London, England,
provides worldwide corporate and investment banking, asset management
and financial services to both domestic and international markets.
RWE AG, headquartered in Essen, Germany, is one of Germany's largest
energy utility companies. Through subsidiaries, the company operates
worldwide, offering products and services in the energy, mining, raw
materials, petroleum, chemicals, waste disposal, mechanical and plant
engineering, construction and civil engineering business sectors.
Rio Tinto Plc, headquartered in London, England, is an international
mining company with operations in Australia, Canada, Europe, New
Zealand, South Africa, South America and the United States.
Royal Bank of Scotland Group Plc, headquartered in Edinburgh, Scotland,
is a holding company that provides a wide range of banking, insurance
and finance-related activities. The company's principal subsidiary,
Royal Bank of Scotland, is a clearing bank that operates over 900
branches internationally. Citizens Financial Group is their U.S.
subsidiary, and Angel Trains provides rolling stock leasing services.
San Paolo-IMI SpA, headquartered in Turin, Italy, operates as a
commercial bank in Italy and abroad and is the holding company of a
diversified financial group which includes municipal lender "Crediop."
ScottishPower Plc, headquartered in Glasgow, Scotland, is an integrated
power and energy group, which generates and supplies electricity and
provides electrical power systems throughout the United Kingdom. The
company also supplies water and waste water services, operates in the
gas and telecommunications sectors, and sells and services electrical
good and home entertainment appliances.
Shell Transport & Trading Company Plc, headquartered in London, England,
owns 40% of the Royal Dutch/Shell Group of companies. These companies
are involved in all phases of the petroleum industry, from exploration
to final processing and delivery. The company primarily derives income
from dividends generated by the group's holding companies. The company
has locations in over 130 countries around the world.
Unilever Plc, headquartered in London, England, manufactures branded and
packaged consumer goods, including food, detergents, fragrances and
personal care products. The company shares operations with Unilever N.V.
The two companies are linked by a series of agreements and operate as a
single entity as much as possible. The company sells its products
internationally.
Equity Securities Selected for The Nasdaq Target 15 Portfolio
Adobe Systems Incorporated, headquartered in San Jose, California,
develops, markets and supports computer software products and
Page 13
technologies that enable users to express and use information across all
print and electronic media.
Apple Computer, Inc., headquartered in Cupertino, California, designs,
makes and markets microprocessor-based personal computers and related
personal computing and communicating solutions for sale mainly to
education, creative, home, business and government customers.
Applied Micro Circuits Corporation, headquartered in San Diego,
California, designs, makes and markets high-performance, high-bandwidth
silicon products for automated test equipment, high-speed computing and
military markets throughout the world.
Atmel Corporation, headquartered in San Jose, California, designs,
develops, makes and markets a broad range of high-performance, non-
volatile memory and logic integrated circuits using its proprietary
complementary metal-oxide semiconductor technologies.
CMGI Inc., headquartered in Andover, Massachusetts, invests in and
develops Internet companies; operates direct marketing companies and
venture funds focused on the Internet; and, through subsidiaries,
provides fulfillment services.
Electronic Arts Inc., headquartered in Redwood City, California,
creates, markets and distributes interactive entertainment software for
a variety of hardware platforms. The company markets its products under
the "Electronic Arts," "Bullfrog Productions," "EA SPORTS," "Jane's
Combat Simulations," "Maxis," "ORIGIN" and "Westwood Studios" brand names.
MedImmune, Inc., headquartered in Gaithersburg, Maryland, develops and
markets products for the prevention and treatment of infectious
diseases, autoimmune diseases and cancer. The company's products are
also used in transplantation medicine.
Oracle Corporation, headquartered in Redwood Shores, California,
designs, develops, markets and supports computer software products with
a wide variety of uses, including database management, application
development, business intelligence and business applications.
PMC-Sierra, Inc., headquartered in Burnaby, British Columbia, Canada,
designs, develops, markets and supports high-performance semiconductor
system solutions used in broadband communications infrastructures, high-
bandwidth networks and multimedia personal computers.
QLogic Corporation, headquartered in Costa Mesa, California, develops
and markets host and peripheral input/output controller integrated
circuits and host adapter cards. The company also develops small
computer system interface target and disk controller chips.
RF Micro Devices, Inc., headquartered in Greensboro, North Carolina,
designs, develops and markets proprietary radio frequency integrated
circuits for wireless communications applications such as cellular,
cordless telephony, wireless security and remote meter reading.
Siebel Systems, Inc., headquartered in San Mateo, California, designs,
sells and supports enterprise-class sales and marketing information
software systems. The company also designs, develops and markets a Web-
based application software product.
Sun Microsystems, Inc., headquartered in Palo Alto, California, supplies
network computing products, including desktop systems, storage
subsystems, network switches, servers, software, microprocessors and a
full range of services and support, using the UNIX operating system.
VISX, Incorporated, headquartered in Santa Clara, California, has
developed and makes a device which uses an excimer laser to reshape the
surface of the cornea to treat nearsightedness, astigmatism and
farsightedness and is intended to reduce or eliminate the patient's
dependence on corrective lenses.
Xilinx, Inc., headquartered in San Jose, California, designs, develops
and sells complementary metal-oxide-silicon (CMOS) programmable logic
devices and related design software, including field programmable gate
arrays and erasable programmable logic devices.
Equity Securities Selected for The S&P Target 10 Portfolio
Alcoa Inc., headquartered in Pittsburgh, Pennsylvania, makes primary
aluminum and fabricated products for the transportation, construction,
packaging and other markets.
Avery Dennison Corporation, headquartered in Pasadena, California,
through subsidiaries, develops, manufactures and markets self-adhesive
materials. The company also makes and sells a variety of office products
Page 14
and other items, including notebooks, three-ring binders, organizing
systems, felt-tip markers, glues, fasteners, business forms, tickets,
tags and imprinting equipment. The company markets its products worldwide.
Circuit City Stores-Circuit City Group, headquartered in Richmond,
Virginia, is one of the nation's largest retailers of brand name
consumer electronics products, including video and audio equipment, home
office products and major appliances. The company operates retail
superstores, consumer electronics-only stores and mall-based "Circuit
City Express" stores throughout the United States.
Citigroup Inc., headquartered in New York, New York, operates the
largest financial services company in the United States. The company
offers consumer, investment and private banking, life insurance,
property and casualty insurance and consumer finance products.
Georgia-Pacific Group, headquartered in Atlanta, Georgia, produces and
distributes pulp, paper and building products. The company's operating
groups are the Georgia-Pacific Group, which operates softwood plywood
plants, oriented strand board plants, and manufacturing facilities; and
The Timber Company, which manages 5.8 million acres of timberland in
North America.
Lehman Brothers Holdings Inc., headquartered in New York, New York,
through wholly-owned Lehman Brothers Inc., provides securities
underwriting, financial advisory and investment and merchant banking
services, securities and commodities trading as principal and agent, and
asset management to institutional, corporate, government and high-net-
worth individual clients throughout the United States and the world.
Morgan Stanley Dean Witter & Co., headquartered in New York, New York,
provides a broad range of nationally-marketed credit and investment
products, with a principal focus on individual customers. The company
provides investment banking, transaction processing, private-label
credit card and various other investment advice services.
Seagate Technology, Inc., headquartered in Scotts Valley, California,
designs, manufactures and markets products for storage, retrieval and
management of data on computer and data communications systems. The
company's products include disk drives and magnetic discs used in
computer systems and multimedia applications; and disc drive components,
tape drives and software.
Tandy Corporation, headquartered in Fort Worth, Texas, with
subsidiaries, sells consumer electronic products across the United
States through its chain of RadioShack stores. The company's products
include private label electronic parts and accessories, audio/video
equipment, digital satellite systems, personal computers, telephones,
scanners, electronic toys and batteries.
Wal-Mart Stores, Inc., headquartered in Bentonville, Arkansas, is one of
the largest retailers in the United States measured by total revenues.
The company operates "Wal-Mart" retail discount department stores, "Wal-
Mart Supercenters" and "Sam's" wholesale clubs in the United States and
several other countries.
We have obtained the foregoing company descriptions from sources we deem
reliable. We have not independently verified the provided information
either in terms of accuracy or completeness.
Page 15
CONTENTS OF REGISTRATION STATEMENT
A. Bonding Arrangements of Depositor:
Nike Securities L.P. is covered by a Brokers' Fidelity Bond,
in the total amount of $1,000,000, the insurer being
National Union Fire Insurance Company of Pittsburgh.
B. This Registration Statement on Form S-6 comprises the
following papers and documents:
The facing sheet
The Prospectus
The signatures
Exhibits
S-1
SIGNATURES
The Registrant, FT 331, hereby identifies The First Trust
Special Situations Trust, Series 4; The First Trust Special
Situations Trust, Series 18; The First Trust Special Situations
Trust, Series 69; The First Trust Special Situations Trust,
Series 108; The First Trust Special Situations Trust, Series 119;
The First Trust Special Situations Trust, Series 190; FT 286; and
The First Trust Combined Series 272 for purposes of the
representations required by Rule 487 and represents the
following:
(1) that the portfolio securities deposited in the series
as to the securities of which this Registration Statement is
being filed do not differ materially in type or quality from
those deposited in such previous series;
(2) that, except to the extent necessary to identify the
specific portfolio securities deposited in, and to provide
essential financial information for, the series with respect to
the securities of which this Registration Statement is being
filed, this Registration Statement does not contain disclosures
that differ in any material respect from those contained in the
registration statements for such previous series as to which the
effective date was determined by the Commission or the staff; and
(3) that it has complied with Rule 460 under the Securities
Act of 1933.
Pursuant to the requirements of the Securities Act of 1933,
the Registrant, FT 331, has duly caused this Amendment to
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the Village of Lisle
and State of Illinois on December 30, 1999.
FT 331
By NIKE SECURITIES L.P.
Depositor
By Robert M. Porcellino
Senior Vice President
S-2
Pursuant to the requirements of the Securities Act of 1933,
this Amendment to the Registration Statement has been signed
below by the following person in the capacity and on the date
indicated:
NAME TITLE* DATE
David J. Allen Sole Director )
of Nike Securities )
Corporation, the ) December 30, 1999
General Partner of )
Nike Securities L.P.)
)
)
) Robert M. Porcellino
) Attorney-in-Fact**
)
)
* The title of the person named herein represents his
capacity in and relationship to Nike Securities L.P.,
Depositor.
** An executed copy of the related power of attorney
was filed with the Securities and Exchange Commission in
connection with the Amendment No. 1 to Form S-6 of The
First Trust Combined Series 258 (File No. 33-63483) and
the same is hereby incorporated herein by this reference.
S-3
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption
"Experts" and to the use of our report dated December 30, 1999 in
Amendment No. 3 to the Registration Statement (Form S-6) (File
No. 333-88643) and related Prospectus of FT 331.
ERNST & YOUNG LLP
Chicago, Illinois
December 30, 1999
CONSENTS OF COUNSEL
The consents of counsel to the use of their names in the
Prospectus included in this Registration Statement will be
contained in their respective opinions to be filed as Exhibits
3.1, 3.2, 3.3 and 3.4 of the Registration Statement.
CONSENT OF FIRST TRUST ADVISORS L.P.
The consent of First Trust Advisors L.P. to the use of its
name in the Prospectus included in the Registration Statement
will be filed as Exhibit 4.1 to the Registration Statement.
S-4
EXHIBIT INDEX
1.1 Form of Standard Terms and Conditions of Trust for The
First Trust Special Situations Trust, Series 22 and
certain subsequent Series, effective November 20, 1991
among Nike Securities L.P., as Depositor, United States
Trust Company of New York as Trustee, Securities
Evaluation Service, Inc., as Evaluator, and First Trust
Advisors L.P. as Portfolio Supervisor (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
43693] filed on behalf of The First Trust Special
Situations Trust, Series 22).
1.1.1 Form of Trust Agreement for FT 331 among Nike Securities
L.P., as Depositor, The Chase Manhattan Bank, as
Trustee, First Trust Advisors L.P., as Evaluator, and
First Trust Advisors L.P., as Portfolio Supervisor.
1.2 Copy of Certificate of Limited Partnership of Nike
Securities L.P. (incorporated by reference to Amendment
No. 1 to Form S-6 [File No. 33-42683] filed on behalf of
The First Trust Special Situations Trust, Series 18).
1.3 Copy of Amended and Restated Limited Partnership
Agreement of Nike Securities L.P. (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
42683] filed on behalf of The First Trust Special
Situations Trust, Series 18).
1.4 Copy of Articles of Incorporation of Nike Securities
Corporation, the general partner of Nike Securities
L.P., Depositor (incorporated by reference to Amendment
No. 1 to Form S-6 [File No. 33-42683] filed on behalf of
The First Trust Special Situations Trust, Series 18).
1.5 Copy of By-Laws of Nike Securities Corporation, the
general partner of Nike Securities L.P., Depositor
(incorporated by reference to Amendment No. 1 to Form S-
6 [File No. 33-42683] filed on behalf of The First Trust
Special Situations Trust, Series 18).
1.6 Underwriter Agreement (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-42755] filed on
behalf of The First Trust Special Situations Trust,
Series 19).
2.1 Copy of Certificate of Ownership (included in Exhibit
1.1 filed herewith on page 2 and incorporated herein by
reference).
S-5
3.1 Opinion of counsel as to legality of securities being
registered.
3.2 Opinion of counsel as to Federal income tax status of
securities being registered.
3.3 Opinion of counsel as to New York income tax status of
securities being registered.
3.4 Opinion of counsel as to advancement of funds by
Trustee.
4.1 Consent of First Trust Advisors L.P.
6.1 List of Directors and Officers of Depositor and other
related information (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-42683] filed on
behalf of The First Trust Special Situations Trust,
Series 18).
7.1 Power of Attorney executed by the Director listed on
page S-3 of this Registration Statement (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
63483] filed on behalf of The First Trust Combined
Series 258).
S-6
MEMORANDUM
FT 331
File No. 333-88643
The Prospectus and the Indenture filed with Amendment No. 3
of the Registration Statement on Form S-6 have been revised to
reflect information regarding the execution of the Indenture and
the deposit of Securities on December 30, 1999 and to set forth
certain statistical data based thereon. In addition, there are a
number of other changes described below.
THE PROSPECTUS
Cover Page The date of the Trusts has been added.
Pages 3-4 The following information for the Trusts appears:
The Aggregate Value of Securities initially
deposited have been added.
The initial number of units of the Trusts
Sales charge
The Public Offering Price per Unit as of the
business day before the Initial Date of Deposit
The Mandatory Termination Date has been added.
Page 7 The Report of Independent Auditors has been
completed.
Pages 8-9 The Statements of Net Assets has been completed.
Pages 10-14 The Schedules of Investments has been completed.
THE TRUST AGREEMENT AND STANDARD TERMS AND CONDITIONS OF TRUST
The Trust Agreement has been conformed to reflect
the execution thereof.
CHAPMAN AND CUTLER
December 30, 1999
FT 331
TRUST AGREEMENT
Dated: December 30, 1999
The Trust Agreement among Nike Securities L.P., as Depositor, The Chase
Manhattan Bank, as Trustee, BISYS Fund Services Ohio, Inc., as
Shareholder Servicing Agent and First Trust Advisors L.P., as Evaluator
and Portfolio Supervisor, sets forth certain provisions in full and
incorporates other provisions by reference to the document entitled
"Standard Terms and Conditions of Trust for The First Trust Special
Situations Trust, Series 22 and certain subsequent Series, Effective
November 20, 1991" (herein called the "Standard Terms and Conditions of
Trust"), and such provisions as are incorporated by reference constitute
a single instrument. All references herein to Articles and Sections are
to Articles and Sections of the Standard Terms and Conditions of Trust.
WITNESSETH THAT:
In consideration of the premises and of the mutual agreements herein
contained, the Depositor, the Trustee, the Shareholder Servicing Agent,
the Evaluator and the Portfolio Supervisor agree as follows:
PART I
STANDARD TERMS AND CONDITIONS OF TRUST
Subject to the provisions of Part II and Part III hereof, all the
provisions contained in the Standard Terms and Conditions of Trust are
herein incorporated by reference in their entirety and shall be deemed
to be a part of this instrument as fully and to the same extent as
though said provisions had been set forth in full in this instrument.
PART II
SPECIAL TERMS AND CONDITIONS OF TRUST
FOR THE DOW(sm) DIVIDEND AND REPURCHASE TARGET 5 PORTFOLIO, QUALIFIED 2000
SERIES ("DART 5 TRUST")
The following special terms and conditions are hereby agreed to:
A.The Securities initially deposited in the Trust pursuant to Section
2.01 of the Standard Terms and Conditions of Trust are set forth in the
Schedules hereto.
B.The aggregate number of Units outstanding for the Trust on the Initial
Date of Deposit and the initial fractional undivided interest in and
ownership of the Trust represented by each Unit thereof are set forth in
the Prospectus in the section "Summary of Essential Information."
Documents representing this number of Units for the Trust are being
delivered by the Trustee to the Depositor pursuant to Section 2.03 of
the Standard Terms and Conditions of Trust.
C.The Percentage Ratio on the Initial Date of Deposit is as set forth in
the Prospectus under "Schedule of Investments."
D.The Depositor may declare such special Record Dates as it determines
to be necessary in light of any extraordinary event affecting the
Securities in the Trust. In the absence of such special distribution,
no distributions shall be made to Unitholders prior to the distribution
on termination of the Trust and liquidation of its assets.
E.The Depositor may declare such special Distribution Dates as it
determines to be necessary in light of any extraordinary event affecting
the Securities in the Trust. In the absence of such special
distribution, no distributions shall be made to Unitholders prior to the
distribution on termination of the Trust and liquidation of its assets.
F.The Mandatory Termination Date for the Trust shall be as set forth in
the Prospectus under "Summary of Essential Information."
G.The Evaluator's compensation as referred to in Section 4.03 of the
Standard Terms and Conditions of Trust shall be an annual fee in the
amount of $.0025 per Unit, calculated based on the largest number of
Units outstanding during the period for which the compensation is paid
(such annual fee to be pro rated for any calendar year in which the
Evaluator provides services during less than the whole of such year).
Such fee may exceed the actual cost of providing such evaluation
services for the Trust, but at no time will the total amount received
for evaluation services rendered to unit investment trusts of which Nike
Securities L.P. is the sponsor in any calendar year exceed the aggregate
cost to the Evaluator of supplying such services in such year.
H.The Trustee's Compensation Rate pursuant to Section 6.04 of the
Standard Terms and Conditions of Trust shall be an annual fee in the
amount of $.0065 per Unit, calculated based on the largest number of
Units outstanding during the calendar year (such annual fee to be pro
rated for any calendar year in which the Trustee provides services
during less than the whole of such year). However, in no event, except
as may otherwise be provided in the Standard Terms and Conditions of
Trust, shall the Trustee receive compensation in any one year from any
Trust of less than $2,000 for such annual compensation.
I.The Initial Date of Deposit for the Trust is December 30, 1999.
J.The minimum amount of Securities to be sold by the Trustee pursuant to
Section 5.02 of the Indenture for the redemption of Units shall be 100
shares.
K. The Depositor's compensation for providing bookkeeping and other
administrative services as described in Section 3.14 of the Standard
Terms and Conditions of Trust shall be an annual fee in the amount of
$.0010 per Unit.
L.Notwithstanding anything to the contrary in the Standard Terms and
Conditions of Trust, the Depositor will bear Annual Trust Operating
Expenses of the Trust in excess of $.0204
PART II
SPECIAL TERMS AND CONDITIONS OF TRUST
FOR THE DOW(sm) DIVIDEND AND REPURCHASE TARGET 10 PORTFOLIO, QUALIFIED
2000 SERIES ("DART 10 TRUST")
The following special terms and conditions are hereby agreed to:
A.The Securities initially deposited in the Trust pursuant to Section
2.01 of the Standard Terms and Conditions of Trust are set forth in the
Schedules hereto.
B.The aggregate number of Units outstanding for the Trust on the Initial
Date of Deposit and the initial fractional undivided interest in and
ownership of the Trust represented by each Unit thereof are set forth in
the Prospectus in the section "Summary of Essential Information."
Documents representing this number of Units for the Trust are being
delivered by the Trustee to the Depositor pursuant to Section 2.03 of
the Standard Terms and Conditions of Trust.
C.The Percentage Ratio on the Initial Date of Deposit is as set forth in
the Prospectus under "Schedule of Investments."
D.The Depositor may declare such special Record Dates as it determines
to be necessary in light of any extraordinary event affecting the
Securities in the Trust. In the absence of such special distribution,
no distributions shall be made to Unitholders prior to the distribution
on termination of the Trust and liquidation of its assets.
E.The Depositor may declare such special Distribution Dates as it
determines to be necessary in light of any extraordinary event affecting
the Securities in the Trust. In the absence of such special
distribution, no distributions shall be made to Unitholders prior to the
distribution on termination of the Trust and liquidation of its assets.
F.The Mandatory Termination Date for the Trust shall be as set forth in
the Prospectus under "Summary of Essential Information."
G.The Evaluator's compensation as referred to in Section 4.03 of the
Standard Terms and Conditions of Trust shall be an annual fee in the
amount of $.0025 per Unit, calculated based on the largest number of
Units outstanding during the period for which the compensation is paid
(such annual fee to be pro rated for any calendar year in which the
Evaluator provides services during less than the whole of such year).
Such fee may exceed the actual cost of providing such evaluation
services for the Trust, but at no time will the total amount received
for evaluation services rendered to unit investment trusts of which Nike
Securities L.P. is the sponsor in any calendar year exceed the aggregate
cost to the Evaluator of supplying such services in such year.
H.The Trustee's Compensation Rate pursuant to Section 6.04 of the
Standard Terms and Conditions of Trust shall be an annual fee in the
amount of $.0065 per Unit, calculated based on the largest number of
Units outstanding during the calendar year (such annual fee to be pro
rated for any calendar year in which the Trustee provides services
during less than the whole of such year). However, in no event, except
as may otherwise be provided in the Standard Terms and Conditions of
Trust, shall the Trustee receive compensation in any one year from any
Trust of less than $2,000 for such annual compensation.
I.The Initial Date of Deposit for the Trust is December 30, 1999.
J.The minimum amount of Securities to be sold by the Trustee pursuant to
Section 5.02 of the Indenture for the redemption of Units shall be 100
shares.
K. The Depositor's compensation for providing bookkeeping and other
administrative services as described in Section 3.14 of the Standard
Terms and Conditions of Trust shall be an annual fee in the amount of
$.0010 per Unit.
L.Notwithstanding anything to the contrary in the Standard Terms and
Conditions of Trust, the Depositor will bear Annual Trust Operating
Expenses of the Trust in excess of $.0204
PART II
SPECIAL TERMS AND CONDITIONS OF TRUST
FOR EUROPEAN TARGET 20 PORTFOLIO, QUALIFIED 2000 SERIES
("EUROPEAN TARGET 20 TRUST")
The following special terms and conditions are hereby agreed to:
A.The Securities initially deposited in the Trust pursuant to Section
2.01 of the Standard Terms and Conditions of Trust are set forth in the
Schedules hereto.
B.The aggregate number of Units outstanding for the Trust on the Initial
Date of Deposit and the initial fractional undivided interest in and
ownership of the Trust represented by each Unit thereof are set forth in
the Prospectus in the section "Summary of Essential Information."
Documents representing this number of Units for the Trust are being
delivered by the Trustee to the Depositor pursuant to Section 2.03 of
the Standard Terms and Conditions of Trust.
C.The Percentage Ratio on the Initial Date of Deposit is as set forth in
the Prospectus under "Schedule of Investments."
D.The Depositor may declare such special Record Dates as it determines
to be necessary in light of any extraordinary event affecting the
Securities in the Trust. In the absence of such special distribution,
no distributions shall be made to Unitholders prior to the distribution
on termination of the Trust and liquidation of its assets.
E.The Depositor may declare such special Distribution Dates as it
determines to be necessary in light of any extraordinary event affecting
the Securities in the Trust. In the absence of such special
distribution, no distributions shall be made to Unitholders prior to the
distribution on termination of the Trust and liquidation of its assets.
F.The Mandatory Termination Date for the Trust shall be as set forth in
the Prospectus under "Summary of Essential Information."
G.The Evaluator's compensation as referred to in Section 4.03 of the
Standard Terms and Conditions of Trust shall be an annual fee in the
amount of $.0025 per Unit, calculated based on the largest number of
Units outstanding during the period for which the compensation is paid
(such annual fee to be pro rated for any calendar year in which the
Evaluator provides services during less than the whole of such year).
Such fee may exceed the actual cost of providing such evaluation
services for the Trust, but at no time will the total amount received
for evaluation services rendered to unit investment trusts of which Nike
Securities L.P. is the sponsor in any calendar year exceed the aggregate
cost to the Evaluator of supplying such services in such year.
H.The Trustee's Compensation Rate pursuant to Section 6.04 of the
Standard Terms and Conditions of Trust shall be an annual fee in the
amount of $.0065 per Unit, calculated based on the largest number of
Units outstanding during the calendar year (such annual fee to be pro
rated for any calendar year in which the Trustee provides services
during less than the whole of such year). However, in no event, except
as may otherwise be provided in the Standard Terms and Conditions of
Trust, shall the Trustee receive compensation in any one year from any
Trust of less than $2,000 for such annual compensation.
I.The Initial Date of Deposit for the Trust is December 30, 1999.
J.The minimum amount of Securities to be sold by the Trustee pursuant to
Section 5.02 of the Indenture for the redemption of Units shall be 100
shares.
K. The Depositor's compensation for providing bookkeeping and other
administrative services as described in Section 3.14 of the Standard
Terms and Conditions of Trust shall be an annual fee in the amount of
$.0010 per Unit.
L.Notwithstanding anything to the contrary in the Standard Terms and
Conditions of Trust, the Depositor will bear Annual Trust Operating
Expenses of the Trust in excess of $.0304
PART II
SPECIAL TERMS AND CONDITIONS OF TRUST
FOR THE NASDAQ TARGET 15 PORTFOLIO, QUALIFIED 2000 SERIES
("NASDAQ TARGET 15 TRUST")
The following special terms and conditions are hereby agreed to:
A.The Securities initially deposited in the Trust pursuant to Section
2.01 of the Standard Terms and Conditions of Trust are set forth in the
Schedules hereto.
B.The aggregate number of Units outstanding for the Trust on the Initial
Date of Deposit and the initial fractional undivided interest in and
ownership of the Trust represented by each Unit thereof are set forth in
the Prospectus in the section "Summary of Essential Information."
Documents representing this number of Units for the Trust are being
delivered by the Trustee to the Depositor pursuant to Section 2.03 of
the Standard Terms and Conditions of Trust.
C.The Percentage Ratio on the Initial Date of Deposit is as set forth in
the Prospectus under "Schedule of Investments."
D.The Depositor may declare such special Record Dates as it determines
to be necessary in light of any extraordinary event affecting the
Securities in the Trust. In the absence of such special distribution,
no distributions shall be made to Unitholders prior to the distribution
on termination of the Trust and liquidation of its assets.
E.The Depositor may declare such special Distribution Dates as it
determines to be necessary in light of any extraordinary event affecting
the Securities in the Trust. In the absence of such special
distribution, no distributions shall be made to Unitholders prior to the
distribution on termination of the Trust and liquidation of its assets.
F.The Mandatory Termination Date for the Trust shall be as set forth in
the Prospectus under "Summary of Essential Information."
G.The Evaluator's compensation as referred to in Section 4.03 of the
Standard Terms and Conditions of Trust shall be an annual fee in the
amount of $.0025 per Unit, calculated based on the largest number of
Units outstanding during the period for which the compensation is paid
(such annual fee to be pro rated for any calendar year in which the
Evaluator provides services during less than the whole of such year).
Such fee may exceed the actual cost of providing such evaluation
services for the Trust, but at no time will the total amount received
for evaluation services rendered to unit investment trusts of which Nike
Securities L.P. is the sponsor in any calendar year exceed the aggregate
cost to the Evaluator of supplying such services in such year.
H.The Trustee's Compensation Rate pursuant to Section 6.04 of the
Standard Terms and Conditions of Trust shall be an annual fee in the
amount of $.0065 per Unit, calculated based on the largest number of
Units outstanding during the calendar year (such annual fee to be pro
rated for any calendar year in which the Trustee provides services
during less than the whole of such year). However, in no event, except
as may otherwise be provided in the Standard Terms and Conditions of
Trust, shall the Trustee receive compensation in any one year from any
Trust of less than $2,000 for such annual compensation.
I.The Initial Date of Deposit for the Trust is December 30, 1999.
J.The minimum amount of Securities to be sold by the Trustee pursuant to
Section 5.02 of the Indenture for the redemption of Units shall be 100
shares.
K. The Depositor's compensation for providing bookkeeping and other
administrative services as described in Section 3.14 of the Standard
Terms and Conditions of Trust shall be an annual fee in the amount of
$.0010 per Unit.
L.Notwithstanding anything to the contrary in the Standard Terms and
Conditions of Trust, the Depositor will bear Annual Trust Operating
Expenses of the Trust in excess of $.0224
PART II
SPECIAL TERMS AND CONDITIONS OF TRUST
FOR THE S&P TARGET 10 PORTFOLIO, QUALIFIED 2000 SERIES
("S&P TARGET 10 TRUST")
The following special terms and conditions are hereby agreed to:
A.The Securities initially deposited in the Trust pursuant to Section
2.01 of the Standard Terms and Conditions of Trust are set forth in the
Schedules hereto.
B.The aggregate number of Units outstanding for the Trust on the Initial
Date of Deposit and the initial fractional undivided interest in and
ownership of the Trust represented by each Unit thereof are set forth in
the Prospectus in the section "Summary of Essential Information."
Documents representing this number of Units for the Trust are being
delivered by the Trustee to the Depositor pursuant to Section 2.03 of
the Standard Terms and Conditions of Trust.
C.The Percentage Ratio on the Initial Date of Deposit is as set forth in
the Prospectus under "Schedule of Investments."
D.The Depositor may declare such special Record Dates as it determines
to be necessary in light of any extraordinary event affecting the
Securities in the Trust. In the absence of such special distribution,
no distributions shall be made to Unitholders prior to the distribution
on termination of the Trust and liquidation of its assets.
E.The Depositor may declare such special Distribution Dates as it
determines to be necessary in light of any extraordinary event affecting
the Securities in the Trust. In the absence of such special
distribution, no distributions shall be made to Unitholders prior to the
distribution on termination of the Trust and liquidation of its assets.
F.The Mandatory Termination Date for the Trust shall be as set forth in
the Prospectus under "Summary of Essential Information."
G.The Evaluator's compensation as referred to in Section 4.03 of the
Standard Terms and Conditions of Trust shall be an annual fee in the
amount of $.0025 per Unit, calculated based on the largest number of
Units outstanding during the period for which the compensation is paid
(such annual fee to be pro rated for any calendar year in which the
Evaluator provides services during less than the whole of such year).
Such fee may exceed the actual cost of providing such evaluation
services for the Trust, but at no time will the total amount received
for evaluation services rendered to unit investment trusts of which Nike
Securities L.P. is the sponsor in any calendar year exceed the aggregate
cost to the Evaluator of supplying such services in such year.
H.The Trustee's Compensation Rate pursuant to Section 6.04 of the
Standard Terms and Conditions of Trust shall be an annual fee in the
amount of $.0065 per Unit, calculated based on the largest number of
Units outstanding during the calendar year (such annual fee to be pro
rated for any calendar year in which the Trustee provides services
during less than the whole of such year). However, in no event, except
as may otherwise be provided in the Standard Terms and Conditions of
Trust, shall the Trustee receive compensation in any one year from any
Trust of less than $2,000 for such annual compensation.
I.The Initial Date of Deposit for the Trust is December 30, 1999.
J.The minimum amount of Securities to be sold by the Trustee pursuant to
Section 5.02 of the Indenture for the redemption of Units shall be 100
shares.
K. The Depositor's compensation for providing bookkeeping and other
administrative services as described in Section 3.14 of the Standard
Terms and Conditions of Trust shall be an annual fee in the amount of
$.0010 per Unit.
L.Notwithstanding anything to the contrary in the Standard Terms and
Conditions of Trust, the Depositor will bear Annual Trust Operating
Expenses of the Trust in excess of $.0234
PART III
A.Notwithstanding anything to the contrary in the Standard Terms and
Conditions of Trust, references to subsequent Series established after
the date of effectiveness of the First Trust Special Situations Trust,
Series 24 shall include FT 331.
B.Notwithstanding anything to the contrary in the Prospectus, parties to
the Trust Agreement are hereby advised:
The Trusts are not sponsored, endorsed, sold or promoted by Dow Jones &
Company, Inc. ("Dow Jones"). Dow Jones makes no representation or
warranty, express or implied, to the owners of the Trusts or any member
of the public regarding the advisability of investing in securities
generally or in the Trusts particularly. Dow Jones' only relationship
to the Sponsor is the licensing of certain trademarks, trade names and
service marks of Dow Jones and of the Dow Jones Industrial Average(SM),
which is determined, composed and calculated by Dow Jones without regard
to the Sponsor or the Trusts. Dow Jones has no obligation to take the
needs of the Sponsor or the owners of the Trusts into consideration in
determining, composing or calculating to Dow Jones Industrial Average(SM).
Dow Jones is not responsible for and has not participated in the
determination of the timing of, prices at, or quantities of the Trusts
to be issued or in the determination or calculation of the equation by
which the Trusts are to be converted into cash. Dow Jones has no
obligation or liability in connection with the administration, marketing
or trading of the Trusts.
DOW JONES DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE
DOW JONES INDUSTRIAL AVERAGE(SM) OR ANY DATA INCLUDED THEREIN AND DOW
JONES SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR
INTERRUPTIONS THEREIN. DOW JONES MAKES NO WARRANTY, EXPRESS OR IMPLIED,
AS TO RESULTS TO BE OBTAINED BY THE SPONSOR, OWNERS OF THE TRUSTS, OR
ANY OTHER PERSON OR ENTITY FROM THE USE OF THE DOW JONES INDUSTRIAL
AVERAGE(SM) OR ANY DATA INCLUDED THEREIN. DOW JONES MAKES NO EXPRESS OR
IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES, OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT
TO THE DOW JONES INDUSTRIAL AVERAGE(SM) OR ANY DATA INCLUDED THEREIN.
WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL DOW JONES HAVE
ANY LIABILITY FOR ANY LOST PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR
CONSEQUENTIAL DAMAGES, EVEN IF NOTIFIED OF THE POSSIBILITY THEREOF.
C.The term "Principal Account" as set forth in the Standard Terms and
Conditions of Trust shall be replaced with the term "Capital Account."
D.Section 1.01(2) shall be amended to read as follows:
"(2)"Trustee" shall mean The Chase Manhattan Bank, or any successor
trustee appointed as hereinafter provided."
All references to United States Trust Company of New York in the
Standard Terms and Conditions of Trust shall be amended to refer to The
Chase Manhattan Bank.
E.Section 1.01(3) shall be amended to read as follows:
"(3) "Evaluator" shall mean First Trust Advisors L.P. and its successors
in interest, or any successor evaluator appointed as hereinafter
provided."
F.Section 1.01(4) shall be amended to read as follows:
"(4) "Portfolio Supervisor" shall mean First Trust Advisors L.P. and its
successors in interest, or any successor portfolio supervisor appointed
as hereinafter provided."
G.Section 1.01(26) shall be added to read as follows:
"(26) The term "Rollover Unit holder" shall be defined as set forth in
Section 5.05, herein."
H.Section 1.01(27) shall be added to read as follows:
"(27) The "Rollover Notification Date" shall be defined as the
Mandatory Termination Date."
I.Section 1.01(28) shall be added to read as follows:
"(28) The term "Rollover Distribution" shall be defined as set forth in
Section 5.05, herein."
J.Section 1.01(29) shall be added to read as follows:
"(29) The term "Distribution Agent" shall refer to the Trustee acting
in its capacity as distribution agent pursuant to Section 5.05 herein."
K.Section 1.01(30) shall be added to read as follows:
"(30) The term "Special Redemption and Liquidation Period" shall be
defined as the Mandatory Termination Date."
L.Paragraph (b) of Section 2.01 shall be restated in its entirety as
follows:
(b)(1)From time to time following the Initial Date of Deposit, the
Depositor is hereby authorized, in its discretion, to assign, convey to
and deposit with the Trustee (i) additional Securities, duly endorsed in
blank or accompanied by all necessary instruments of assignment and
transfer in proper form, (ii) Contract Obligations relating to such
additional Securities, accompanied by cash and/or Letter(s) of Credit as
specified in paragraph (c) of this Section 2.01, or (iii) cash (or a
Letter of Credit in lieu of cash) with instructions to purchase
additional Securities, in an amount equal to the portion of the Unit
Value of the Units created by such deposit attributable to the
Securities to be purchased pursuant to such instructions. Except as
provided in the following subparagraphs (2), (3) and (4) the Depositor,
in each case, shall ensure that each deposit of additional Securities
pursuant to this Section shall maintain, as nearly as practicable, the
Percentage Ratio. Each such deposit of additional Securities shall be
made pursuant to a Notice of Deposit of Additional Securities delivered
by the Depositor to the Trustee. Instructions to purchase additional
Securities shall be in writing, and shall specify the name of the
Security, CUSIP number, if any, aggregate amount, price or price range
and date to be purchased. When requested by the Trustee, the Depositor
shall act as broker to execute purchases in accordance with such
instructions; the Depositor shall be entitled to compensation therefor
in accordance with applicable law and regulations. The Trustee shall
have no liability for any loss or depreciation resulting from any
purchase made pursuant to the Depositor's instructions or made by the
Depositor as broker.
(2)Additional Securities (or Contract Obligations therefor) may, at the
Depositor's discretion, be deposited or purchased in round lots. If the
amount of the deposit is insufficient to acquire round lots of each
Security to be acquired, the additional Securities shall be deposited or
purchased in the order of the Security in the Trust most under-
represented immediately before the deposit with respect to the
Percentage Ratio.
(3)If at the time of a deposit of additional Securities, Securities of
an issue deposited on the Initial Date of Deposit (or of an issue of
Replacement Securities acquired to replace an issue deposited on the
Initial Date of Deposit) are unavailable, cannot be purchased at
reasonable prices or their purchase is prohibited or restricted by
applicable law, regulation or policies, the Depositor may (i) deposit,
or instruct the Trustee to purchase, in lieu thereof, another issue of
Securities or Replacement Securities or (ii) deposit cash or a letter of
credit in an amount equal to the valuation of the issue of Securities
whose acquisition is not feasible with instructions to acquire such
Securities of such issue when they become available.
(4)Any contrary authorization in the preceding subparagraphs (1) through
(3) notwithstanding, deposits of additional Securities made after the 90-
day period immediately following the Initial Date of Deposit (except for
deposits made to replace Failed Contract Obligations if such deposits
occur within 20 days from the date of a failure occurring within such
initial 90-day period) shall maintain exactly the Percentage Ratio
existing immediately prior to such deposit.
(5)In connection with and at the time of any deposit of additional
Securities pursuant to this Section 2.01(b), the Depositor shall exactly
replicate Cash (as defined below) received or receivable by the Trust as
of the date of such deposit. For purposes of this paragraph, "Cash"
means, as to the Capital Account, cash or other property (other than
Securities) on hand in the Capital Account or receivable and to be
credited to the Capital Account as of the date of the deposit (other
than amounts to be distributed solely to persons other than holders of
Units created by the deposit) and, as to the Income Account, cash or
other property (other than Securities) received by the Trust as of the
date of the deposit or receivable by the Trust in respect of a record
date for a payment on a Security which has occurred or will occur before
the Trust will be the holder of record of a Security, reduced by the
amount of any cash or other property received or receivable on any
Security allocable (in accordance with the Trustee's calculations of
distributions from the Income Account pursuant to Section 3.05) to a
distribution made or to be made in respect of a Record Date occurring
prior to the deposit. Such replication will be made on the basis of a
fraction, the numerator of which is the number of Units created by the
deposit and the denominator of which is the number of Units which are
outstanding immediately prior to the deposit. Cash represented by a
foreign currency shall be replicated in such currency or, if the Trustee
has entered into a contract for the conversion thereof, in U.S. dollars
in an amount replicating the dollars to be received on such conversion."
M.The following shall be added immediately following the first sentence
of paragraph (c) of Section 2.01:
"The Trustee may allow the Depositor to substitute for any Letter(s) of
Credit deposited with the Trustee in connection with the deposits
described in Section 2.01(a) and (b) cash in an amount sufficient to
satisfy the obligations to which the Letter(s) of Credit relates. Any
substituted Letter(s) of Credit shall be released by the Trustee."
N.Section 2.01(c) of the Standard Terms and Conditions of Trust is
hereby amended by adding the following at the conclusion thereof:
"If any Contract Obligation requires settlement in a foreign currency,
in connection with the deposit of such Contract Obligation the Depositor
will deposit with the Trustee either an amount of such currency
sufficient to settle the contract or a foreign exchange contract in such
amount which settles concurrently with the settlement of the Contract
Obligation and cash or a Letter of Credit in U.S. dollars sufficient to
perform such foreign exchange contact."
O.Section 3.01 of the Standard Terms and Conditions of Trust shall be
replaced in its entirety with the following:
"Section 3.01. Initial Cost. Subject to reimbursement as hereinafter
provided, the cost of organizing the Trust and the sale of the Trust
Units shall be borne by the Depositor, provided, however, that the
liability on the part of the Depositor under this section shall not
include any fees or other expenses incurred in connection with the
administration of the Trust subsequent to the deposit referred to in
Section 2.01. At the earlier of six months after the Initial Date of
Deposit or the conclusion of the primary offering period (as certified
by the Depositor to the Trustee), the Trustee shall withdraw from the
Account or Accounts specified in the Prospectus or, if no Account is
therein specified, from the Capital Account, and pay to the Depositor
the Depositor's reimbursable expenses of organizing the Trust in an
amount certified to the Trustee by the Depositor. In no event shall the
amount paid by the Trustee to the Depositor for the Depositor's
reimbursable expenses of organizing the Trust exceed the estimated per
Unit amount of organization costs set forth in the Prospectus for the
Trust multiplied by the number of Units of the Trust outstanding at the
earlier of six months after the Initial Date of Deposit or the
conclusion of the primary offering period; nor shall the Depositor be
entitled to or request reimbursement for expenses of organizing the
Trust incurred after the earlier of six months after the Initial Date of
Deposit or the conclusion of the primary offering period. If the cash
balance of the Capital Account is insufficient to make such withdrawal,
the Trustee shall, as directed by the Depositor, sell Securities
identified by the Depositor, or distribute to the Depositor Securities
having a value, as determined under Section 4.01 as of the date of
distribution, sufficient for such reimbursement. Securities sold or
distributed to the Depositor to reimburse the Depositor pursuant to this
Section shall be sold or distributed by the Trustee, to extent
practicable, in the percentage ratio then existing. The reimbursement
provided for in this section shall be for the account of the Unit
holders of record at the earlier of six months after the Initial Date of
Deposit or the conclusion of the primary offering period. Any assets
deposited with the Trustee in respect of the expenses reimbursable under
this Section 3.01 shall be held and administered as assets of the Trust
for all purposes hereunder. The Depositor shall deliver to the Trustee
any cash identified in the Statement of Net Assets of the Trust included
in the Prospectus not later than the expiration of the Delivery Period
and the Depositor's obligation to make such delivery shall be secured by
the letter of credit deposited pursuant to Section 2.01. Any cash which
the Depositor has identified as to be used for reimbursement of expenses
pursuant to this Section 3.01 shall be held by the Trustee, without
interest, and reserved for such purpose and, accordingly, prior to the
earlier of six months after the Initial Date of Deposit or the
conclusion of the primary offering period, shall not be subject to
distribution or, unless the Depositor otherwise directs, used for
payment of redemptions in excess of the per Unit amount payable pursuant
to the next sentence. If a Unit holder redeems Units prior to the
earlier of six months after the Initial Date of Deposit or the
conclusion of the primary offering period, the Trustee shall pay to the
Unit holder, in addition to the Redemption Value of the tendered Units,
unless otherwise directed by the Depositor, an amount equal to the
estimated per Unit cost of organizing the Trust set forth in the
Prospectus, or such lower revision thereof most recently communicated to
the Trustee by the Depositor pursuant to Section 5.01, multiplied by the
number of Units tendered for redemption; to the extent the cash on hand
in the Trust is insufficient for such payment, the Trustee shall have
the power to sell Securities in accordance with Section 5.02. As used
herein, the Depositor's reimbursable expenses of organizing the Trust
shall include the cost of the initial preparation and typesetting of the
registration statement, prospectuses (including preliminary
prospectuses), the indenture, and other documents relating to the Trust,
SEC and state blue sky registration fees, the cost of the initial
valuation of the portfolio and audit of the Trust, the initial fees and
expenses of the Trustee, and legal and other out-of-pocket expenses
related thereto, but not including the expenses incurred in the printing
of preliminary prospectuses and prospectuses, expenses incurred in the
preparation and printing of brochures and other advertising materials
and any other selling expenses.
P.The second paragraph of Section 3.02 of the Standard Terms and
Conditions is hereby deleted and replaced with the following sentence:
"Any non-cash distributions (other than a non-taxable distribution of
the shares of the distributing corporation which shall be retained by a
Trust) received by a Trust shall be dealt with in the manner described
at Section 3.11, herein, and shall be retained or disposed of by such
Trust according to those provisions. The proceeds of any disposition
shall be credited to the Income Account of a Trust. Neither the Trustee
nor the Depositor shall be liable or responsible in any way for
depreciation or loss incurred by reason of any such sale."
Q.Section 3.05.II(a) of the Standard Terms and Conditions of Trust is
hereby amended to read in its entirety as follows:
"II.(a) On each Distribution Date, the Trustee shall distribute to each
Unit holder of record at the close of business on the Record Date
immediately preceding such Distribution Date an amount per Unit equal to
such Unit holder's Income Distribution (as defined below), plus such
Unit holder's pro rata share of the balance of the Capital Account
(except for monies on deposit therein required to purchase Contract
Obligations) computed as of the close of business on such Record Date
after deduction of any amounts provided in Subsection I, provided,
however, that the Trustee shall not be required to make a distribution
from the Capital Account unless the amount available for distribution
shall equal $1.00 per 100 Units.
All distributions shall be made by check mailed to the post office
address of the Unit holder as it appears on the registration books of
the Trustee."
R.Section 3.05.II(b) of the Standard Terms and Conditions of Trust is
hereby amended to read in its entirety as follows:
"II.(b) For purposes of this Section 3.05, the Unit holder's Income
Distribution shall be equal to such Unit holder's pro rata share of the
cash balance in the Income Account computed as of the close of business
on the Record Date immediately preceding such Income Distribution after
deduction of (i) the fees and expenses then deductible pursuant to
Section 3.05.I. and (ii) the Trustee's estimate of other expenses
properly chargeable to the Income Account pursuant to the Indenture
which have accrued, as of such Record Date, or are otherwise properly
attributable to the period to which such Income Distribution relates."
S.Paragraph (c) of Subsection II of Section 3.05 of the Standard Terms
and Conditions of Trust is hereby amended to read as follows:
"On each Distribution Date the Trustee shall distribute to each Unit
holder of record at the close of business on the Record Date immediately
preceding such Distribution Date an amount per Unit equal to such Unit
holder's pro rata share of the balance of the Capital Account (except
for monies on deposit therein required to purchase Contract Obligations)
computed as of the close of business on such Record Date after deduction
of any amounts provided in Subsection I."
T.Section 3.05 of Article III of the Standard Terms and Conditions of
Trust is hereby amended to include the following subsection:
"Section 3.05.I.(e)deduct from the Income Account or, to the extent
funds are not available in such Account, from the Capital Account and
pay to the Depositor the amount that it is entitled to receive pursuant
to Section 3.14."
U.Section 3.11 of the Standard Terms and Conditions of Trust is hereby
deleted in its entirety and replaced with the following language:
"Section 3.11. Notice to Depositor.
In the event that the Trustee shall have been notified at any time of
any action to be taken or proposed to be taken by at least a legally
required number of holders of any Securities deposited in a Trust, the
Trustee shall take such action or omit from taking any action, as
appropriate, so as to insure that the Securities are voted as closely as
possible in the same manner and the same general proportion as are the
Securities held by owners other than such Trust.
In the event that an offer by the issuer of any of the Securities or any
other party shall be made to issue new securities, or to exchange
securities, for Trust Securities, the Trustee shall reject such offer.
However, should any issuance, exchange or substitution be effected
notwithstanding such rejection or without an initial offer, any
securities, cash and/or property received shall be deposited hereunder
and shall be promptly sold, if securities or property, by the Trustee
pursuant to the Depositor's direction, unless the Depositor advises the
Trustee to keep such securities or property. The Depositor may rely on
the Portfolio Supervisor in so advising the Trustee. The cash received
in such exchange and cash proceeds of any such sales shall be
distributed to Unit holders on the next distribution date in the manner
set forth in Section 3.05 regarding distributions from the Capital
Account. The Trustee shall not be liable or responsible in any way for
depreciation or loss incurred by reason of any such sale.
Neither the Depositor nor the Trustee shall be liable to any person for
any action or failure to take action pursuant to the terms of this
Section 3.11.
Whenever new securities or property is received and retained by a Trust
pursuant to this Section 3.11, the Trustee shall provide to all Unit
holders of such Trust notices of such acquisition in the Trustee's
annual report unless prior notice is directed by the Depositor."
V.The first sentence of Section 3.13. shall be amended to read as follows:
"As compensation for providing supervisory portfolio services under this
Indenture, the Portfolio Supervisor shall receive, in arrears, against a
statement or statements therefor submitted to the Trustee monthly or
annually an aggregate annual fee in the amount of $.0025 per Unit,
calculated based on the largest number of Units outstanding during the
period for which the compensation is paid (such annual fee to be pro
rated for any calendar year in which the Portfolio Supervisor provides
services during less than the whole of such year). Such fee may exceed
the actual cost of providing such portfolio supervision services for the
Trust, but at no time will the total amount received for portfolio
supervision services rendered to unit investment trusts of which Nike
Securities L.P. is the sponsor in any calendar year exceed the aggregate
cost to the Portfolio Supervisor of supplying such services in such year."
W.Article III of the Standard Terms and Conditions of Trust is hereby
amended by inserting the following paragraphs which shall be entitled
Section 3.14.:
"Section 3.14.Bookkeeping and Administrative Expenses. As compensation
for providing bookkeeping and other administrative services of a
character described in Section 26(a)(2)(C) of the Investment
Company Act of 1940 to the extent such services are in addition to, and
do not duplicate, the services to be provided hereunder by the Trustee
or the Portfolio Supervisor, the Depositor shall receive against a
statement or statements therefor submitted to the Trustee monthly or
annually an aggregate annual fee in the per Unit amount set forth in
Part II of the Trust Agreement, calculated based on the largest number
of Units outstanding during the period for which the compensation is
paid (such annual fee to be pro rated for any calendar year in which the
Depositor provides services during less than the whole of such year).
Such fee may exceed the actual cost of providing such bookkeeping and
administrative services for the Trust, but at not time will the total
amount received for bookkeeping and administrative services rendered to
unit investment trusts of which Nike Securities L.P. is the sponsor in
any calendar year exceed the aggregate cost to the Depositor of
supplying such services in such year. Such compensation may, from time
to time, be adjusted provided that the total adjustment upward does not,
at the time of such adjustment, exceed the percentage of the total
increase, after the date hereof, in consumer prices for services as
measured by the United States Department of Labor consumer Price Index
entitled "All Services Less Rent of Shelter" or similar index, if such
index should no longer be published. The consent or concurrence of any
Unit holder hereunder shall not be required for any such adjustment or
increase. Such compensation shall be paid by the Trustee, upon receipt
of an invoice therefor from the Depositor, upon which, as to the cost
incurred by the Depositor of providing services hereunder the Trustee
may rely, and shall be charged against the Income and Capital Accounts
on or before the Distribution Date following the Monthly Record Date on
which such period terminates. The Trustee shall have no liability to
any Certificateholder or other person for any payment made in good faith
pursuant to this Section.
If the cash balance in the Income and Capital Accounts shall be
insufficient to provide for amounts payable pursuant to this Section
3.14, the Trustee shall have the power to sell (i) Securities from the
current list of Securities designated to be sold pursuant to Section
5.02 hereof, or (ii) if no such Securities have been so designated, such
Securities as the Trustee may see fit to sell in its own discretion, and
to apply the proceeds of any such sale in payment of the amounts payable
pursuant to this Section 3.14.
Any moneys payable to the Depositor pursuant to this Section 3.14 shall
be secured by a prior lien on the Trust Fund except that no such lien
shall be prior to any lien in favor of the Trustee under the provisions
of Section 6.04 herein."
X.Article III of the Standard Terms and Conditions of Trust is hereby
amended by inserting the following paragraph which shall be entitled
Section 3.15:
"Section 3.15. Deferred Sales Charge. If the prospectus related to the
Trust specifies a deferred sales charge, the Trustee shall, on the dates
specified in and as permitted by such Prospectus (the "Deferred Sales
Charge Payment Dates"), withdraw from the Capital Account, an amount per
Unit specified in such Prospectus and credit such amount to a special
non-Trust account designated by the Depositor out of which the deferred
sales charge will be distributed to or on the order of the Depositor on
such Deferred Sales Charge Payment Dates (the "Deferred Sales Charge
Account"). If the balance in the Capital Account is insufficient to
make such withdrawal, the Trustee shall, as directed by the Depositor,
advance funds in an amount required to fund the proposed withdrawal and
be entitled to reimbursement of such advance upon the deposit of
additional monies in the Capital Account, and/or sell Securities and
credit the proceeds thereof to the Deferred Sales Charge Account,
provided, however, that the aggregate amount advanced by the Trustee at
any time for payment of the deferred sales charge shall not exceed
$15,000. Such direction shall, if the Trustee is directed to sell a
Security, identify the Security to be sold and include instructions as
to the execution of such sale. In the absence of such direction by the
Depositor, the Trustee shall sell Securities sufficient to pay the
deferred sales charge (and any unreimbursed advance then outstanding) in
full, and shall select Securities to be sold in such manner as will
maintain (to the extent practicable) the relative proportion of number
of shares of each Security then held. The proceeds of such sales, less
any amounts paid to the Trustee in reimbursement of its advances, shall
be credited to the Deferred Sales Charge Account. If a Unit holder
redeems Units prior to full payment of the deferred sales charge, the
Trustee shall, if so provided in the related Prospectus, on the
Redemption Date, withhold from the Redemption Price payable to such Unit
holder an amount equal to the unpaid portion of the deferred sales
charge and distribute such amount to the Deferred Sales Charge Account.
If the Trust is terminated for reasons other than that set forth in
Section 6.01(g), the Trustee shall, if so provided in the related
Prospectus, on the termination of the Trust, withhold from the proceeds
payable to Unit holders an amount equal to the unpaid portion of the
deferred sales charge and distribute such amount to the Deferred Sales
Charge Account. If the Trust is terminated pursuant to Section 6.01(g),
the Trustee shall not withhold from the proceeds payable to Unit holders
any amounts of unpaid deferred sales charges. If pursuant to Section
5.02 hereof, the Depositor shall purchase a Unit tendered for redemption
prior to the payment in full of the deferred sales charge due on the
tendered Unit, the Depositor shall pay to the Unit holder the amount
specified under Section 5.02 less the unpaid portion of the deferred
sales charge. All advances made by the Trustee pursuant to this Section
shall be secured by a lien on the Trust prior to the interest of the
Unit holders."
Y.Notwithstanding anything to the contrary in Sections 3.15 and 4.05 of
the Standard Terms and Conditions of Trust, so long as Nike Securities
L.P. is acting as Depositor, the Trustee shall have no power to remove
the Portfolio Supervisor.
Z.Article III of the Standard Terms and Conditions of Trust is hereby
amended by adding the following new Section 3.16:
"Section 3.16. Foreign Currency Exchange. Unless the Depositor shall
otherwise direct, whenever funds are received by the Trustee in foreign
currency, upon the receipt thereof or, if such funds are to be received
in respect of a sale of Securities, concurrently with the contract of
the sale for the Security (in the latter case the foreign exchange
contract to have a settlement date coincident with the relevant contract
of sale for the Security), the Trustee shall enter into a foreign
exchange contract for the conversion of such funds to U.S. dollars
pursuant to the instruction of the Depositor. The Trustee shall have no
liability for any loss or depreciation resulting from action taken
pursuant to such instruction."
AA.Article IV, Section 4.01 of the Standard Terms and Conditions of
Trust is hereby amended in the following manner:
1.Section 4.01(b) is hereby amended by deleting that portion of the
first sentence appearing after the colon and the entire second sentence
and replacing them in their entirety with the following:
"if the Securities are listed on a national or foreign securities
exchange or The Nasdaq Stock Market, such Evaluation shall generally be
based on the closing sale price on the exchange or system which is the
principal market therefor, which shall be deemed to be the New York
Stock Exchange if the Securities are listed thereon (unless the
Evaluator deems such price inappropriate as a basis for evaluation), or
if there is no closing sale price on such exchange or system, at the
closing ask prices. If the 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 price on the
over-the-counter market (unless it is determined that these prices are
inappropriate as a basis for evaluation). If current ask prices are
unavailable, the evaluation is generally determined (a) on the basis of
current ask prices for comparable securities, (b) by appraising the
value of the Securities on the ask side of the market or (c) any
combination of the above. If such prices are in a currency other than
U.S. dollars, the Evaluation of such Security shall be converted to U.S.
dollars based on current offering side exchange rates, unless the
Security is in the form of an American Depositary Share or Receipt, in
which case the Evaluations shall be based upon the U.S. dollar prices in
the market for American Depositary Shares or Receipts (unless the
Evaluator deems such prices inappropriate as a basis for valuation). As
used herein, the closing sale price is deemed to mean the most recent
closing sale price on the relevant securities exchange immediately prior
to the Evaluation time."
2.Section 4.01(c) is hereby deleted and replaced in its entirety with
the following:
"(c)After the initial offering period and both during and after the
initial offering period, for purposes of the Trust Fund Evaluations
required by Section 5.01 in determining Redemption Value and Unit Value,
Evaluation of the Securities shall be made in the manner described in
Section 4.01(b), on the basis of current bid prices for Zero Coupon
Obligations (if any),the bid side value of the relevant currency
exchange rate expressed in U.S. dollars and, except in those cases in
which the Equity Securities are listed on a national or foreign
securities exchange or The Nasdaq Stock Market and the closing sale
prices are utilized, on the basis of the current bid prices of the
Equity Securities. In addition, the Evaluator shall reduce the
Evaluation of each Security by the amount of any liquidation costs
(other than brokerage costs incurred on any national securities
exchange) and any capital gains or other taxes which would be incurred
by the Trust upon the sale of such Security, such taxes being computed
as if the Security were sold on the date of the Evaluation."
BB.The first sentence of Section 4.03. shall be amended to read as
follows:
"As compensation for providing evaluation services under this Indenture,
the Evaluator shall receive, in arrears, against a statement or
statements therefor submitted to the Trustee monthly or annually an
aggregate annual fee equal to the amount specified as compensation for
the Evaluator in the Trust Agreement, calculated based on the largest
number of Units outstanding during the period for which the compensation
is paid (such annual fee to be pro rated for any calendar year in which
the Evaluator provides services during less than the whole of such
year). Such compensation may, from time to time, be adjusted provided
that the total adjustment upward does not, at the time of such
adjustment, exceed the percentage of the total increase, after the date
hereof, in consumer prices for services as measured by the United States
Department of Labor Consumer Price Index entitled "All Services Less
Rent of Shelter" or similar index, if such index should no longer be
published. The consent or concurrence of any Unit holder hereunder
shall not be required for any such adjustment or increase. Such
compensation shall be paid by the Trustee, upon receipt of invoice
therefor from the Evaluator, upon which, as to the cost incurred by the
Evaluator of providing services hereunder the Trustee may rely, and
shall be charged against the Income and/or Capital Accounts, in
accordance with Section 3.05."
CC.Section 5.01 is hereby amended to add the following at the conclusion
of the first paragraph thereof:
"For the purpose of calculating the accrual of fees computed on the
largest number of Units outstanding, the Depositor shall provide the
Trustee with estimates of such number of Units for the relevant periods.
Amounts receivable by the Trust in a foreign currency shall be reported
to the Evaluator who shall convert the same to U.S. dollars based on
current exchange rates, in the same manner as provided in Section
4.01(b) or 4.01(c), as applicable, for the conversion of the valuation
of foreign Equity Securities, and the Evaluator shall report such
conversion with each Evaluation made pursuant to Section 4.01."
DD.Section 5.01 of the Standard Terms and Conditions of Trust shall be
amended as follows:
(i)The second sentence of the first paragraph of Section 5.01 shall be
amended by deleting the phrase "and (iii)" and adding the following
"(iii) amounts representing unpaid accrued organization costs, and (iv)"
; and
(ii) The following text shall immediately precede the last sentence of
the first paragraph of Section 5.01:
"Prior to the payment to the Depositor of its reimbursable organization
costs to be made at the earlier of six months after the Initial Date of
Deposit or the conclusion of the primary offering period in accordance
with Section 3.01, for purposes of determining the Trust Fund Evaluation
under this Section 5.01, the Trustee shall rely upon the amounts
representing unpaid accrued organization costs in the estimated amount
per Unit set forth in the Prospectus until such time as the Depositor
notifies the Trustee in writing of a revised estimated amount per Unit
representing unpaid accrued organization costs. Upon receipt of such
notice, the Trustee shall use this revised estimated amount per Unit
representing unpaid accrued organization costs in determining the Trust
Fund Evaluation but such revision of the estimated expenses shall not
effect calculations made prior thereto and no adjustment shall be made
in respect thereof."
EE.Section 5.02 of the Standard Terms and Conditions of Trust is amended
by adding the following after the second paragraph of such section:
"Notwithstanding anything herein to the contrary, in the event that any
tender of Units pursuant to this Section 5.02 would result in the
disposition by the Trustee of less than a whole Security, the Trustee
shall distribute cash in lieu thereof and sell such Securities as
directed by the Sponsors as required to make such cash available.
If provided for in the prospectus, Unit holders of the Trusts may redeem
1,000 Units or more of such Trust and request a distribution in kind of
(i) such Unit holder's pro rata portion of each of the Securities in
such Trust, in whole shares, and (ii) cash equal to such Unit holder's
pro rata portion of the Income and Capital Accounts as follows: (x) a
pro rata portion of the net proceeds of sale of the Securities
representing any fractional shares included in such Unit holder's pro
rata share of the Securities and (y) such other cash as may properly be
included in such Unit holder's pro rata share of the sum of the cash
balances of the Income and Principal Accounts in an amount equal to the
Unit Value determined on the basis of a Trust Fund Evaluation made in
accordance with Section 5.01 determined by the Trustee on the date of
tender less amounts determined in clauses (i) and (ii)(x) of this
Section. Subject to Section 5.05 with respect to Rollover Unit holders,
to the extent possible, distributions of Securities pursuant to an in
kind redemption of Units shall be made by the Trustee through the
distribution of each of the Securities in book-entry form to the account
of the Unit holder's bank or broker-dealer at the Depository Trust
Company. Any distribution in kind will be reduced by customary transfer
and registration charges."
FF.The following Section 5.05 shall be added:
"Section 5.05. Rollover of Units. (a) If the Depositor shall offer a
subsequent series of the DART 5 Trust, the DART 10 Trust, the Global
Target 15 Trust, The S&P Target 10 Trust, or The Nasdaq Target 15 Trust
(the "New Series"), the Trustee shall, at the Depositor's sole cost and
expense, include in the notice sent to Unit holders specified in Section
8.02 a form of election whereby Unit holders, whose redemption
distribution would be in an amount sufficient to purchase at least one
Unit of the New Series, may elect to have their Unit(s) redeemed in kind
in the manner provided in Section 5.02, the Securities included in the
redemption distribution sold, and the cash proceeds applied by the
Distribution Agent to purchase Units of a New Series, all as hereinafter
provided. The Trustee shall honor properly completed election forms
returned to the Trustee, accompanied by any Certificate evidencing Units
tendered for redemption or a properly completed redemption request with
respect to uncertificated Units, by its close of business on the
Rollover Notification Date. The notice and form of election to be sent
to Unit holders in respect of any redemption and purchase of Units of a
New Series as provided in this section shall be in such form and shall
be sent at such time or times as the Depositor shall direct the Trustee
in writing and the Trustee shall have no responsibility therefor. The
Distribution Agent acts solely as disbursing agent in connection with
purchases of Units pursuant to this Section and nothing herein shall be
deemed to constitute the Distribution Agent a broker in such transactions.
All Units so tendered by a Unit holder (a "Rollover Unit holder") shall
be redeemed and cancelled during the Special Redemption and Liquidation
Period on such date or dates specified by the Depositor. Subject to
payment by such Rollover Unit holder of any tax or other governmental
charges which may be imposed thereon, such redemption is to be made in
kind pursuant to Section 5.02 by distribution of cash and/or Securities
to the Distribution Agent on the redemption date equal to the net asset
value (determined on the basis of the Trust Fund Evaluation as of the
redemption date in accordance with Section 4.01) multiplied by the
number of Units being redeemed (herein called the "Rollover
Distribution"). Any Securities that are made part of the Rollover
Distribution shall be valued for purposes of the redemption distribution
as of the redemption date.
All Securities included in a Unit holder's Rollover Distribution shall
be sold by the Distribution Agent during the Special Redemption and
Liquidation Period specified in the Prospectus pursuant to the
Depositor's direction, and the Distribution Agent shall, unless directed
otherwise by the Depositor, employ the Depositor as broker in connection
with such sales. For such brokerage services, the Depositor shall be
entitled to compensation at its customary rates, provided however, that
its compensation shall not exceed the amount authorized by applicable
securities laws and regulations. The Depositor shall direct that sales
be made in accordance with the guidelines set forth in the Prospectus
under the heading "Special Redemption, Liquidation and Investment in a
New Trust." Should the Depositor fail to provide direction, the
Distribution Agent shall sell the Securities in the manner provided in
the prospectus. The Distribution Agent shall have no responsibility for
any loss or depreciation incurred by reason of any sale made pursuant to
this Section.
Upon completion of all sales of Securities included in the Rollover Unit
holder's Rollover Distribution, the Distribution Agent shall, as agent
for such Rollover Unit holder, enter into a contract with the Depositor
to purchase from the Depositor Units of a New Series (if any), at the
Depositor's public offering price for such Units on such day, and at
such reduced sales charge as shall be described in the prospectus for
such Trust. Such contract shall provide for purchase of the maximum
number of Units of a New Series whose purchase price is equal to or less
than the cash proceeds held by the Distribution Agent for the Unit
holder on such day (including therein the proceeds anticipated to be
received in respect of Securities traded on such day net of all
brokerage fees, governmental charges and any other expenses incurred in
connection with such sale), to the extent Units are available for
purchase from the Depositor. In the event a sale of Securities included
in the Rollover Unit holder's redemption distribution shall not be
consummated in accordance with its terms, the Distribution Agent shall
apply the cash proceeds held for such Unit holder as of the settlement
date for the purchase of Units of a New Series to purchase the maximum
number of Units which such cash balance will permit, and the Depositor
agrees that the settlement date for Units whose purchase was not
consummated as a result of insufficient funds will be extended until
cash proceeds from the Rollover Distribution are available in a
sufficient amount to settle such purchase. If the Unit holder's
Rollover Distribution will produce insufficient cash proceeds to
purchase all of the Units of a New Series contracted for, the Depositor
agrees that the contract shall be rescinded with respect to the Units as
to which there was a cash shortfall without any liability to the
Rollover Unit holder or the Distribution Agent. Any cash balance
remaining after such purchase shall be distributed within a reasonable
time to the Rollover Unit holder by check mailed to the address of such
Unit holder on the registration books of the Trustee. Units of a New
Series will be uncertificated unless and until the Rollover Unit holder
requests a certificate. Any cash held by the Distribution Agent shall
be held in a non-interest bearing account which will be of benefit to
the Distribution Agent in accordance with normal banking procedures.
Neither the Trustee nor the Distribution Agent shall have any
responsibility or liability for loss or depreciation resulting from any
reinvestment made in accordance with this paragraph, or for any failure
to make such reinvestment in the event the Depositor does not make Units
available for purchase.
(b)Notwithstanding the foregoing, the Depositor may, in its discretion
at any time, decide not to offer any new Trust Series in the future, and
if so, this Section 5.05 concerning the Rollover of Units shall be
inoperative.
(c)The Distribution Agent shall receive no fees for performing its
duties hereunder. The Distribution Agent shall, however, be entitled to
receive indemnification and reimbursement from the Trust for any and all
expenses and disbursements to the same extent as the Trustee is
permitted reimbursement hereunder."
GG.Paragraph (e) of Section 6.01 of Article VI of the Standard Terms and
Conditions of Trust is amended to read as follows:
"(e)(I)Subject to the provisions of subparagraphs (II) and (III) of this
paragraph, the Trustee may employ agents, sub-custodians, attorneys,
accountants and auditors and shall not be answerable for the default or
misconduct of any such agents, sub-custodians, attorneys, accountants or
auditors if such agents, sub-custodians, attorneys, accountants or
auditors shall have been selected with reasonable care. The Trustee
shall be fully protected in respect of any action under this Indenture
taken or suffered in good faith by the Trustee in accordance with the
opinion of counsel, which may be counsel to the Depositor acceptable to
the Trustee, provided, however, that this disclaimer of liability shall
not (i) excuse the Trustee from the responsibilities specified in
subparagraph II below or (ii) limit the obligation of the Trustee to
indemnify the Trust under subparagraph III below. The fees and expenses
charged by such agents, sub-custodians, attorneys, accountants or
auditors shall constitute an expense of the Trust reimbursable from the
Income and Capital Accounts of the affected Trust as set forth in
section 6.04 hereof.
(II)The Trustee may place and maintain in the care of an eligible
foreign custodian (which is employed by the Trustee as a sub-custodian
as contemplated by subparagraph (I) of this paragraph (e) and which may
be an affiliate or subsidiary of the Trustee or any other entity in
which the Trustee may have an ownership Income) the Trust's foreign
securities, cash and cash equivalents in amounts reasonably necessary to
effect the Trust's foreign securities transactions, provided that the
Trustee hereby agrees to perform all the duties assigned by rule 17f-5
as now in effect or as it may be amended in the future, to the boards of
management investment companies. The Trustee's duties under the
preceding sentence will not be delegated.
As used in this subparagraph (II),
(1)"foreign securities" include: securities issued and sold primarily
outside the United States by a foreign government, a national of any
foreign country or a corporation or other organization incorporated or
organized under the laws of any foreign country and securities issued or
guaranteed by the government of the United States or by any state or any
political subdivision thereof or by any agency thereof or by any entity
organized under the laws of the United States or of any state thereof
which have been issued and sold primarily outside the United States.
(2)"eligible foreign custodian" means
(a)The following securities depositories and clearing agencies which
operate transnational systems for the central handling of securities or
equivalent book entries which, by appropriate exemptive order issued by
the Securities and Exchange Commission, have been qualified as eligible
foreign custodians for the Trust but only for so long as such exemptive
order continues in effect: Morgan Guaranty Trust Company of New York,
Brussels, Belgium, in its capacity as operator of the Euroclear System
("Euroclear"), and Cedel Bank S.A. ("CEDEL").
(b)Any other entity that shall have been qualified as an eligible
foreign custodian for the foreign securities of the Trust by the
Securities and Exchange Commission by exemptive order, rule or other
appropriate action, commencing on such date as it shall have been so
qualified but only for so long as such exemptive order, rule or other
appropriate action continues in effect.
(III)The Trustee will indemnify and hold the Trust harmless from and
against any loss occurring as a result of an eligible foreign
custodian's willful misfeasance, reckless disregard, bad faith, or gross
negligence in performing custodial duties."
HH.Paragraph (g) of Section 6.01 of the Standard Terms and Conditions of
Trust is hereby amended by inserting the following after the first word
thereof:
"(i) the value of any Trust as shown by an evaluation by the Trustee
pursuant to Section 5.01 hereof shall be less than the lower of
$2,000,000 or 20% of the total value of Securities deposited in such
Trust during the initial offering period, or (ii)"
II .The first sentence of the second paragraph of Section 6.04 shall be
amended to include the phrase "license fees, if any," immediately after
the reference to legal and auditing expenses.
JJ.The third sentence of paragraph (a) of Section 6.05 of the Standard
Terms and Conditions of Trust shall be replaced in its entirety by the
following:
"The Depositor may remove the Trustee at any time with or without cause
and appoint a successor Trustee by written instrument or instruments
delivered not less than sixty days prior to the effective date of such
removal and appointment to the Trustee so removed and the successor
Trustee."
KK.The first sentence of the fourth paragraph of Section 8.02 of the
Standard Terms and Conditions of Trust shall be deleted and replaced
with the following:
"Commencing no earlier than nine business days prior to a Trust's
Mandatory Termination Date, the Trustee will liquidate the Securities
during such period and in such daily amounts as the Depositor shall
direct."
LL.Notwithstanding anything to the contrary in the Indenture, and only
for purposes of paying fees and expenses payable to the Sponsor and/or
its affiliates which are deductible pursuant to Section 3.05.I. of the
Standard Terms and conditions of Trust and the Trustee's estimate of
other expenses properly chargeable to the income Account pursuant to the
Indenture which have accrued, the Trustee shall treat the fifteenth day
of each month as a "Record Date" and the last day of such month as the
corresponding "Distribution Date"
MM.Notwithstanding any provision to the contrary in the Standard Terms
and Conditions of Trust, Units will be held only in uncertificated form.
NN.Notwithstanding any provision to the contrary in the Standard Terms
and Conditions of Trust, the Trustee may deem and treat the Shareholder
Servicing Agent as the sole Unit holder for all purposes of the
Indenture and shall not be affected by any notice to the contrary.
OO.Section 1.01 of the Standard Terms and Conditions of Trust shall be
amended to include the following:
"Section 1.01(31). "Shareholder Servicing Agent" shall mean BISYS Fund
Services Ohio, Inc., or any successor shareholder servicing agent
appointed as hereinafter provided."
PP.Section 3.05.I. of the Standard Terms and Conditions of Trust shall
be amended to include the following at the end of such section:
"(f) deduct from the Income account or, to the extent funds are not
available in such Account, from the Capital Account and pay to the
Shareholder Servicing Agent the amount that it is entitled to receive
pursuant to Section 3.17."
QQ.Article III of the Standard Terms and Conditions of Trust shall be
amended to include the following section:
"Section 3.17. Shareholder Servicing Agent. (a) The Shareholder
Servicing Agent shall perform all of the duties with respect to
recordkeeping of Units and Unit holders, distributions, redemption of
Units and communications to and with Unit holders listed below.
(1) The Shareholder Servicing Agent shall keep proper books of record
and account of all of the transactions in the Units of each Trust under
this Indenture at its corporate office, including a record of the name
and address of, and the Units issued by each Trust and held by, every
Unit holder, and such books and records of each Trust shall be made
available to the Trustee and the Depositor promptly upon request and
open to inspection by any Unit holder of such Trust at all reasonable
times during usual business hours. Without limiting the foregoing, the
Shareholder Servicing Agent shall make any records or documents
described in Reg. 270.31(a)-1 under the Investment Company Act of 1940
available promptly to the Trustee and the Depositor upon request during
usual business hours and will preserve such records and documents for the
periods prescribed in Reg. 270.31(a)-2 thereunder.
(2) The Shareholder Servicing Agent shall distribute on or shortly after
the Distribution Dates specified in the Trust Agreement to each Unit
holder of record on its books on the Record Date for each such
Distribution Date specified in the Trust Agreement such Unit holder's
distribution as computed under the Standard Terms and Conditions of Trust.
(3) In connection with such distributions set forth above, the
Shareholder Servicing Agent shall furnish a Distribution Statement to
Unit holders of record on its books. The content and frequency of such
Distribution Statements shall in no respect be less detailed or frequent
than that specified in Section 3.06 of the Standard Terms and Conditions
of Trust.
(4) The Shareholder Servicing Agent shall transmit to each Unit holder
of record any notice or other communication received from the Trustee
and shall be solely responsible for soliciting and transmitting to the
Trustee any notice required from Unit holders.
(5) For purposes of permitting Unit holders to satisfy any reporting
requirements of applicable federal or state tax law, the Shareholder
Servicing Agent shall transmit to any Unit holder of record on its books
any reports is receives from the Trustee pursuant to Section 4.02 of the
Standard Terms and Conditions of Trust.
(6) The Shareholder Servicing Agent shall distribute to redeeming Unit
holders of record on its books redemption proceeds it receives pursuant
to Section 5.02 of the Standard Terms and Conditions of Trust from the
Trustee as the sole record owner of Units on the Trustee's books.
(7) The Shareholder Servicing Agent shall distribute to Unit holders of
record on its books a pro rata portion of termination proceeds it
receives pursuant to Section 8.02 of the Standard Terms and Conditions
of Trust from the Trustee as the sole record owner of Units on the
Trustee's books.
(8) In connection with such termination distributions set forth above,
the Shareholder Servicing Agent shall furnish a Final Distribution
Statement to Unit holders of record on its books. The content of such
Final Distribution Statements shall in no respect be less detailed than
that specified in Section 8.02 of the Standard Terms and Conditions of
Trust.
(9) As requested by the Depositor and/or the Trustee, the Shareholder
Servicing Agent shall perform such other functions which, from time to
time, are agreed upon by the parties hereto and which may give rise to
additional fees.
(b) As compensation for providing the services set forth herein, the
Shareholder Servicing Agent shall receive an annual fee of $40,000 per
Trust payable in monthly installments, in arrears, on or shortly after
the last day of each month commencing on the first such day occurring
not earlier than 30 days after the Initial Date of Deposit, provided
that the final installment shall be paid on or shortly after the
Mandatory Termination Date. The installment payments shall be in the
following amounts: (i) the first six monthly payments shall be in the
amount of $2916.66, and (ii) the six subsequent payments shall be in the
amount of $3,750. The annual fee payable to the Shareholder Servicing
Agent shall be prorated for any annual period during which the
Shareholder Servicing Agent provides services for less than the whole of
any annual period and in such event the monthly installments provided
above shall be proportionately reduced. Such compensation may, from time
to time, be adjusted by the Depositor provided that the total adjustment
upward does not, at the time of such adjustment, exceed the percentage
of the total increase, after the date hereof, in consumer prices for
services as measured by the United States Department of Labor Consumer
Price Index entitled "All Services Less Rent of Shelter" or similar
index, if such index should no longer be published. The consent or
concurrence of any Unit holder hereunder shall not be required for any
such adjustment or increase. In addition, against an itemized invoice
therefor submitted to the Trustee on or before each Record Date, the
Shareholder Servicing Agent shall be entitled to reimbursement from the
Trust for its reasonable expenses and disbursements in carrying out its
duties to the Trusts. Such compensation or reimbursement shall be
charged against the Income and/or Capital Accounts, in accordance with
Section 3.05 of the Standard Terms and Conditions of Trust.
If the cash balance in the Income and Capital Accounts shall be
insufficient to provide for amounts payable pursuant to this Section
3.17, the Trustee shall have the power to sell (i) Securities from the
current list of Securities designated to be sold pursuant to Section
5.02 hereof, or (ii) if no such Securities have been so designated, such
Securities as the Trustee may see fit to sell in its own discretion, and
to apply the proceeds of any such sale in payment of the amounts payable
pursuant to this Section 3.17.
All moneys payable to the Shareholder Servicing Agent pursuant to this
Section 3.17 shall be secured by a lien on the Trust prior to the
interest of Unit holders, but no such lien shall be prior to any lien in
favor of the Trustee under the provisions of Section 6.04 of the
Standard Terms and Conditions of Trust.
(c) The Shareholder Servicing Agent shall be under no liability for any
action taken in good faith on any appraisal, paper, order, list, demand,
request, consent, affidavit, notice, opinion, direction, evaluation,
endorsement, assignment, resolution, draft or other document, whether or
not of the same kind, prima facie properly executed, or for the
disposition of moneys, pursuant to this Indenture, except by reason of
its own negligence, lack of good faith or willful misconduct, provided
that the Shareholder Servicing Agent shall not in any event be liable or
responsible for any evaluation made by the Evaluator.
(d) Except as the context otherwise requires, the Shareholder Servicing
Agent shall be subject to the provisions of Section 4.05 herein in the
same manner as it would if it were the Evaluator.
(e) The Shareholder Servicing Agent shall be indemnified ratably by the
affected Trust and held harmless against any loss or liability accruing
to it without negligence, bad faith or willful misconduct on its part,
arising out of or in connection with the operations of this Trust,
including the costs and expenses (including counsel fees) of defending
itself against any claim of liability in the premises, including without
limitation any loss, liability or expense incurred in acting pursuant to
written directions to the Shareholder Servicing Agent given by the
Trustee or Depositor from time to time in accordance with the provisions
of this Indenture or in undertaking actions from time to time which the
Shareholder Servicing Agent deems necessary in its discretion to protect
the Trust and the rights and interests of the Unit holders pursuant to
the terms of this Indenture.
(f) The Shareholder Servicing Agent shall conduct its operations in a
manner that is compatible with the current operational procedures and
requirements of the Trustee (including, without limiting the foregoing,
the provision and receipt of data in such format and meeting such
technical requirements as the Trustee may specify) and shall exercise
its best efforts to accommodate any changes in the operational
procedures and requirements which the Trustee may make upon prior notice
to the Shareholder Servicing Agent. The Depositor acknowledges and
agrees that the default of the Shareholder Servicing Agent in its
obligations under this paragraph, or the performance by the Shareholder
Servicing Agent of its obligations in a manner which shall adversely
affect the Trustee's performance of its duties, shall be a sufficient
grounds for the Trustee to remove the Shareholder Servicing Agent
pursuant to Section 3.17(d) and Section 4.05.
(g) As used in this Section 3.17, "Unit holder," when referring to the
records of the Trustee, shall mean the Shareholder Servicing Agent and,
when referring to the records to be maintained by the Shareholder
Servicing Agent, shall mean each owner of a Unit identified on the
records of the Shareholder Servicing Agent."
RR.Section 4.01(a) and (b) of the Standard Terms and Conditions of Trust
shall be amended to include the Shareholder Servicing Agent among the
parties who are furnished information concerning the Evaluation of each
issue of Securities deposited in the Trust and the Trust Fund Evaluation.
SS.Section 4.04 of the Standard Terms and Conditions of Trust shall be
replaced in its entirety by the following:
"Section 4.04. Liability of Evaluator. The Trustee, Shareholder
Servicing Agent, Depositor and the Unit holders may rely on any
Evaluation furnished by the Evaluator and shall have no responsibility
for the accuracy thereof. The determinations made by the Evaluator
hereunder shall be made in good faith upon the basis of the best
information available to it. The Evaluator shall be under no liability
to the Trustee, Shareholder Servicing Agent, Depositor or the Unit
holders for errors in judgement; provided, however, that this provision
shall not protect the Evaluator against any liability to which it would
otherwise be subject by reason of willful misfeasance, bad faith or
gross negligence in the performance of its duties or by reason of its
reckless disregard of its obligations and duties hereunder."
TT.The second sentence of the first paragraph of Section 5.01 shall be
amended to delete subsection (ii) of such sentence and replace it in its
entirety with the following:
"(ii) amounts representing estimated accrued expenses of such Trust
including but not limited to unpaid fees and expenses of the Trustee,
the Evaluator, the Portfolio Supervisor, the Shareholder Servicing Agent
(to the extent such fees and expenses are charged to the Trust), the
Depositor and its counsel, in each case as reported by the Trustee to
the Depositor on or prior to the date of Evaluation,"
UU.Section 6.01(c) of the Standard Terms and Conditions of Trust shall
be replaced in its entirety with the following:
"(c) The Trustee shall not be responsible for or in respect of the
recitals herein, the validity or sufficiency of this Indenture or for
the due execution hereof by the Depositor, the Portfolio Supervisor, the
Evaluator, or the Shareholder Servicing Agent, or for the form,
character, genuineness, sufficiency, value or validity of any of the
Securities (except that the Trustee shall be responsible for the
exercise of due care in determining the genuineness of Securities
delivered to it pursuant to contracts for the purchase of such
Securities) or for or in respect of the validity or sufficiency of the
Units or of the Certificates (except for the due execution thereof by
the Trustee) or for the due execution thereof by the Depositor, and the
Trustee shall in no event assume or incur any liability, duty or
obligation to any Unit holder, the Shareholder Servicing Agent or the
Depositor other than as expressly provided for herein. The Trustee
shall not be responsible for or in respect of the validity of any
signature by or on behalf of the Depositor, the Portfolio Supervisor,
the Evaluator or the Shareholder Servicing Agent;"
VV.Section 8.02(b) of the Standard Terms and Conditions of Trust shall
be replaced in its entirety with the following:
"(b) deduct from the Income Account of such Trust or, to the extent that
funds are not available in such Account, from the Capital Account of
such Trust, and pay accrued and unpaid fees of the Evaluator, the
Portfolio Supervisor, the Shareholder Servicing Agent (to the extent
such fees are charged to the Trust), the Depositor and counsel in
connection with such Trust, if any;"
WW.Section 8.05 of the Standard Terms and Conditions of Trust shall be
amended to add the following paragraph immediately preceding the last
paragraph of such section:
"Any notice, demand, direction or instruction to be given to the
Shareholder Servicing Agent shall be in writing and shall be duly given
if mailed or delivered to the Shareholder Servicing Agent at 3435
Stelzer Road, Columbus, Ohio 43219, or at such other address as shall be
specified by the Shareholder Servicing Agent to the other parties hereto
in writing."
XX.Section 2.03(a) of the Standard Terms and Conditions of Trust shall
be amended by adding the following sentence after the first sentence of
such section:
"The number of Units may be increased through a split of the Units or
decreased through a reverse split thereof, as directed in writing by the
Depositor, at any time when the Depositor is the only beneficial holder
of units, which revised number of Units shall be recorded by the Trustee
on its books. The Trustee shall be entitled to rely on the Depositor's
direction as certification that no person other than the Depositor has a
beneficial interest in the Units and the Trustee shall have no liability
to any person for action taken pursuant to such direction."
IN WITNESS WHEREOF, Nike Securities L.P., The Chase Manhattan Bank,
BISYS Fund Services Ohio, Inc. and First Trust Advisors L.P. have each
caused this Trust Agreement to be executed and the respective corporate
seal to be hereto affixed and attested (if applicable) by authorized
officers; all as of the day, month and year first above written.
NIKE SECURITIES L.P., Depositor
By Robert M. Porcellino
Senior Vice President
THE CHASE MANHATTAN BANK, Trustee
By Rosalia Raviele
Vice President
[SEAL]
ATTEST:
Joan Currie
Assistant Treasurer
FIRST TRUST ADVISORS L.P., Evaluator
By Robert M. Porcellino
Senior Vice President
FIRST TRUST ADVISORS L.P.,
Portfolio Supervisor
By Robert M. Porcellino
Senior Vice President
BISYS Fund Services Ohio, Inc.,
Shareholding Servicing Agent
By
SCHEDULE A TO TRUST AGREEMENT
Securities Initially Deposited
FT 331
(Note: Incorporated herein and made a part hereof for the Trust is the
"Schedule of Investments" for the Trust as set forth in the Prospectus.)
CHAPMAN AND CUTLER
111 WEST MONROE STREET
CHICAGO, ILLINOIS 60603
December 30, 1999
Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
Re: FT 331
Gentlemen:
We have served as counsel for Nike Securities L.P., as
Sponsor and Depositor of FT 331 in connection with the December
30, 1999 among Nike Securities L.P., as Depositor, The Chase
Manhattan Bank as Trustee, First Trust Advisors L.P. as Evaluator
and Portfolio Supervisor, and BISYS Fund Services Ohio, Inc. as
Shareholder Servicing Agent, pursuant to which the Depositor has
delivered to and deposited the Securities listed in Schedule A to
the Trust Agreement with the Trustee and pursuant to which the
Trustee has issued to or on the order of the Depositor a
certificate or certificates representing units of fractional
undivided interest in and ownership of the Fund created under
said Trust Agreement.
In connection therewith, we have examined such pertinent
records and documents and matters of law as we have deemed
necessary in order to enable us to express the opinions
hereinafter set forth.
Based upon the foregoing, we are of the opinion that:
1. the execution and delivery of the Trust Agreement and
the execution and issuance of certificates evidencing the Units
in the Fund have been duly authorized; and
2. the certificates evidencing the Units in the Fund when
duly executed and delivered by the Depositor and the Trustee in
accordance with the aforementioned Trust Agreement, will
constitute valid and binding obligations of the Fund and the
Depositor in accordance with the terms thereof.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement (File No. 333-88643)
relating to the Units referred to above, to the use of our name
and to the reference to our firm in said Registration Statement
and in the related Prospectus.
Respectfully submitted,
CHAPMAN AND CUTLER
EFF:erg
CHAPMAN AND CUTLER
111 WEST MONROE STREET
CHICAGO, ILLINOIS 60603
December 30, 1999
Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
The Chase Manhattan Bank
4 New York Plaza, 6th Floor
New York, New York 10004-2413
Re: FT 331
Gentlemen:
We have acted as counsel for Nike Securities L.P., Depositor
of FT 331 (the "Fund"), in connection with the issuance of units
of fractional undivided interests in the Trusts of said Fund (the
"Trust"), under a Trust Agreement, dated December 30, 1999 (the
"Indenture"), among Nike Securities L.P., as Depositor, The Chase
Manhattan Bank, as Trustee and First Trust Advisors L.P., as
Evaluator and Portfolio Supervisor.
In this connection, we have examined the Registration
Statement, the form of Prospectus proposed to be filed with the
Securities and Exchange Commission, the Indenture and such other
instruments and documents we have deemed pertinent. The opinions
expressed herein assume that the Trusts will be administered, and
investments by the Trusts from proceeds of subsequent deposits,
if any, will be made, in accordance with the terms of the
Indenture. Each Trust holds Equity Securities as such term is
defined in the Prospectus. For purposes of this opinion, it is
assumed that each Equity Security is equity for Federal income
tax purposes.
Based upon the foregoing and upon an investigation of such
matters of law as we consider to be applicable, we are of the
opinion that, under existing federal income tax law:
Each Trust is not an association taxable as a corporation
for Federal income tax purposes, but will be governed by the
provisions of subchapter J (relating to trusts) of Chapter 1,
Internal Revenue Code of 1986 (the "Code").
Because the Eligible Plans are exempt from tax under
Sections 501(a) or 457 of the Internal Revenue Code of 1986, as
amended, while Units are held by Eligible Plans, neither such
Eligible Plans nor any participating employee will be taxed on
income from a Trust.
No opinion is expressed with respect to the federal income
taxation of Units of a Trust or distributions from such Trust if
the Units are held by any persons other than Eligible Plans.
Further the scope of this opinion is expressly limited to
the matters set forth herein, and, except as expressly set forth
above, we express no opinion with respect to any other taxes,
including foreign, state or local taxes or collateral tax
consequences with respect to the purchase, ownership and
disposition of Units.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement (File No. 333-88643)
relating to the Units referred to above and to the use of our
name and to the reference to our firm in said Registration
Statement and in the related Prospectus.
Very truly yours,
CHAPMAN AND CUTLER
EFF/erg
CARTER, LEDYARD & MILBURN
COUNSELLORS AT LAW
2 WALL STREET
NEW YORK, NEW YORK 10005
December 30, 1999
The Chase Manhattan Bank, as Trustee of
FT 331
4 New York Plaza, 6th Floor
New York, New York 10004-3113
Attention: Mr. Thomas Porazzo
Vice President
Re: FT 331
Dear Sirs:
We are acting as special counsel with respect to New York
tax matters for the unit investment trust or trusts included in
FT 331 (each, a "Trust"), which will be established under a
certain Standard Terms and Conditions of Trust dated November 20,
1991, and a related Trust Agreement dated as of today
(collectively, the "Indenture") among Nike Securities L.P., as
Depositor (the "Depositor"), First Trust Advisors L.P., as
Evaluator, First Trust Advisors L.P., as Portfolio Supervisor,
BISYS Fund Services Ohio, Inc., as Shareholder Servicing Agent,
and The Chase Manhattan Bank as Trustee (the "Trustee").
Pursuant to the terms of the Indenture, units of fractional
undivided interest in the Trust (the "Units") will be issued in
the aggregate number set forth in the Indenture.
We have examined and are familiar with originals or
certified copies, or copies otherwise identified to our
satisfaction, of such documents as we have deemed necessary or
appropriate for the purpose of this opinion. In giving this
opinion, we have relied upon the two opinions, each dated today
and addressed to the Trustee, of Chapman and Cutler, counsel for
the Depositor, with respect to the matters of law set forth
therein.
Based upon the foregoing, we are of the opinion that the
Trust will not constitute an association taxable as a corporation
under New York law, and accordingly will not be subject to the
New York State franchise tax or the New York City general
corporation tax.
We consent to the filing of this opinion as an exhibit to
the Registration Statement (No. 333-88643) filed with the
Securities and Exchange Commission with respect to the
registration of the sale of the Units and to the references to
our name in such Registration Statement and the preliminary
prospectus included therein.
Very truly yours,
CARTER, LEDYARD & MILBURN
CARTER, LEDYARD & MILBURN
COUNSELLORS AT LAW
2 WALL STREET
NEW YORK, NEW YORK 10005
December 30, 1999
The Chase Manhattan Bank, as Trustee of
FT 331
4 New York Plaza, 6th Floor
New York, New York 10004-3113
Attention: Mr. Thomas Porazzo
Vice President
Re: FT 331
Dear Sirs:
We are acting as counsel for The Chase Manhattan Bank
("Chase") in connection with the execution and delivery of a
Trust Agreement ("the Trust Agreement") dated today's date (which
Trust Agreement incorporates by reference certain Standard Terms
and Conditions of Trust dated November 20, 1991, and the same are
collectively referred to herein as the "Indenture") among Nike
Securities L.P., as Depositor (the "Depositor"), First Trust
Advisors L.P., as Evaluator, First Trust Advisors L.P., as
Portfolio Supervisor, BISYS Fund Services Ohio, Inc., as
Shareholder Servicing Agent, and Chase, as Trustee (the
"Trustee"), establishing the unit investment trust or trusts
included in FT 331 (each, a "Trust"), and the confirmation by
Chase, as Trustee under the Indenture, that it has registered on
the registration books of the Trust the ownership by the
Depositor of a number of units constituting the entire interest
in the Trust (such aggregate units being herein called "Units"),
each of which represents an undivided interest in the respective
Trust which consists of common stocks (including, confirmations
of contracts for the purchase of certain stocks not delivered and
cash, cash equivalents or an irrevocable letter of credit or a
combination thereof, in the amount required for such purchase
upon the receipt of such stocks), such stocks being defined in
the Indenture as Securities and referenced in the Schedule to the
Indenture.
We have examined the Indenture, a specimen of the
certificates which, unless the Indenture provides that the Units
will be uncertificated, will be issued thereunder (the
"Certificates"), the Closing Memorandum dated today's date, and
such other documents as we have deemed necessary in order to
render this opinion. Based on the foregoing, we are of the
opinion that:
1. Chase is a duly organized and existing corporation
having the powers of a Trust Company under the laws of the State
of New York.
2. The Trust Agreement has been duly executed and
delivered by Chase and, assuming due execution and delivery by
the other parties thereto, constitutes the valid and legally
binding obligation of Chase.
3. The Certificates are in proper form for execution and
delivery by Chase, as Trustee.
4. Chase, as Trustee, has registered on the registration
books of the Trust the ownership of the Units by the Depositor.
Upon receipt of confirmation of the effectiveness of the
registration statement for the sale of the Units filed with the
Securities and Exchange Commission under the Securities Act of
1933, the Trustee may deliver Certificates for such Units, in
such names and denominations as the Depositor may request, to or
upon the order of the Depositor as provided in the Closing
Memorandum.
In rendering the foregoing opinion, we have not considered,
among other things, whether the Securities have been duly
authorized and delivered.
Very truly yours,
CARTER, LEDYARD & MILBURN
First Trust Advisors L.P.
1001 Warrenville Road
Lisle, Illinois 60532
December 30, 1999
Nike Securities L.P.
1001 Warrenville Road
Lisle, IL 60532
Re: FT 331
Gentlemen:
We have examined the Registration Statement File No.
333-88643 for the above captioned fund. We hereby consent to the
use in the Registration Statement of the references to First
Trust Advisors L.P. as evaluator.
You are hereby authorized to file a copy of this letter with
the Securities and Exchange Commission.
Sincerely,
First Trust Advisors L.P.
Robert M. Porcellino
Senior Vice President
