File No. 333-87783
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-1004
POST-EFFECTIVE
AMENDMENT NO. 1
TO
FORM S-6
For Registration Under the Securities Act of 1933 of Securities
of Unit Investment Trusts Registered on Form N-8B-2
FT 371
AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
BIOTECHNOLOGY PORTFOLIO SERIES
COMMUNICATIONS PORTFOLIO, SERIES 5
E-TAIL PORTFOLIO SERIES
INTERNET PORTFOLIO, SERIES 8
MARKET LEADERS PORTFOLIO, SERIES 4
RETAIL PORTFOLIO, SERIES 4
(Exact Name of Trust)
NIKE SECURITIES L.P.
(Exact Name of Depositor)
1001 Warrenville Road
Lisle, Illinois 60532
(Complete address of Depositor's principal executive offices)
NIKE SECURITIES L.P. CHAPMAN AND CUTLER
Attn: James A. Bowen Attn: Eric F. Fess
1001 Warrenville Road 111 West Monroe Street
Lisle, Illinois 60532 Chicago, Illinois 60603
(Name and complete address of agents for service)
It is proposed that this filing will become effective (check
appropriate box)
: : immediately upon filing pursuant to paragraph (b)
: x : November 30, 2000
: : 60 days after filing pursuant to paragraph (a)
: : on (date) pursuant to paragraph (a) of rule (485 or 486)
<PAGE>
FT 371
AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
1,735,877 UNITS
PROSPECTUS
Part One
Dated November 28, 2000
Note: Part One of this Prospectus may not be distributed unless accompanied by
Part Two and Part Three.
The Trust
The America's Leading Brands Portfolio, Series 6 (the "Trust") is a unit
investment trust consisting of a portfolio containing common stocks issued by
companies considered to be leaders in their industries. At October 16, 2000,
each Unit represented a 1/1,735,877 undivided interest in the principal and
net income of the Trust (see "The Trust" in Part Two).
The Units being offered by this Prospectus are issued and outstanding Units
which have been purchased by us, Nike Securities L.P., the Sponsor of the
Trust in the secondary market or from the Trustee after having been tendered
for redemption. The profit or loss resulting from the sale of Units will
accrue to us. No proceeds from the sale of Units will be received by the
Trust.
Public Offering Price
The Public Offering Price per Unit is equal to the aggregate value of the
Securities in the Portfolio of the Trust, plus or minus cash, if any, in the
Income and Capital Accounts of the Trust divided by the number of Units
outstanding, plus a sales charge of 4.5% of the Public Offering Price (4.712%
of the net amount invested) excluding income and principal cash. At October
16, 2000, the Public Offering Price per Unit was $9.742 (see "Public Offering"
in Part Two). The minimum purchase is $1,000 ($500 for Individual Retirement
Accounts or other retirement plans).
Please retain all parts of this Prospectus for future reference.
______________________________________________________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
______________________________________________________________________________
NIKE SECURITIES L.P.
Sponsor
<PAGE>
FT 371
AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
SUMMARY OF ESSENTIAL INFORMATION AS OF OCTOBER 16, 2000
Sponsor: Nike Securities L.P.
Evaluator: First Trust Advisors L.P.
Trustee: The Chase Manhattan Bank
<TABLE>
<CAPTION>
GENERAL INFORMATION
<S> <C>
Number of Units 1,735,877
Fractional Undivided Interest in the Trust per Unit 1/1,735,877
Public Offering Price:
Aggregate Value of Securities in the Portfolio $16,116,997
Aggregate Value of Securities per Unit $9.285
Income and Principal cash in the Portfolio $32,551
Income and Principal cash per Unit $.019
Sales Charge 4.712% (4.5% of Public Offering Price,
excluding income and principal cash) $.438
Public Offering Price per Unit $9.742
Redemption Price and our Repurchase Price per
Unit ($.438 less than the Public Offering Price
per Unit) $9.304
</TABLE>
Date Trust Established October 15, 1999
Mandatory Termination Date October 15, 2004
Evaluator's Annual Fee: $.0030 per Unit outstanding. Evaluations for
purposes of sale, purchase or redemption of Units are made as of the close of
trading (4:00 p.m. Eastern time) on the New York Stock Exchange on each day on
which it is open.
Supervisory fee payable to Maximum of $.0035 per
an affiliate of ours Unit outstanding annually
Bookkeeping and administrative expenses Maximum of $.0015 per
payable to us Unit outstanding annually
Trustee's Annual Fee: $.0096 per Unit outstanding.
Capital Distribution Record Date and Distribution Date: Distributions from
the Capital Account will be made monthly payable on the last day of the month
to Unit holders of record on the fifteenth day of such month if the amount
available for distribution equals at least $.01 per Unit. Notwithstanding,
distributions of funds in the Capital Account, if any, will be made in
December of each year.
Income Distribution Record Date: Fifteenth day of each June and December.
Income Distribution Date: The last day of each June and December.
A Unit holder who owns at least 1,000 Units may request an "In-Kind
Distribution" upon redemption or upon termination of the Trust. See "Rights
of Unit Holders - How are Income and Capital Distributed?" in Part Two.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Unit Holders of FT 371,
America's Leading Brands Portfolio, Series 6
We have audited the accompanying statement of assets and liabilities,
including the portfolio, of FT 371, America's Leading Brands Portfolio, Series
6 at July 31, 2000, and the related statements of operations and changes in
net assets for the period from the Initial Date of Deposit, October 15, 1999,
to July 31, 2000. These financial statements are the responsibility of the
Trust's Sponsor. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
July 31, 2000, by correspondence with the Trustee. An audit also includes
assessing the accounting principles used and significant estimates made by the
Sponsor, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of FT 371, America's Leading
Brands Portfolio, Series 6 at July 31, 2000, and the results of its operations
and changes in its net assets for the period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000, in conformity with accounting principles
generally accepted in the United States.
ERNST & YOUNG LLP
Chicago, Illinois
November 9, 2000
<PAGE>
FT 371
AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
STATEMENT OF ASSETS AND LIABILITIES
July 31, 2000
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Securities, at market value (cost, $19,532,222)
(Note 1) $19,509,081
Dividends receivable 23,188
Cash 60,384
Receivable from investment transactions 164,883
___________
19,757,536
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND NET ASSETS
<S> <C> <C>
Liability for deferred sales charge (Note 3) 276,985
Accrued liabilities 3,694
Unit redemptions payable 162,651
___________
443,330
___________
Net assets, applicable to 1,961,980 outstanding
units of fractional undivided interest:
Cost of Trust assets (Note 1) $19,532,222
Net unrealized depreciation (Note 2) (23,141)
Distributable funds 618,923
Less deferred sales charge paid or
accrued (Note 3) (799,498)
Less organization and offering costs
(Note 1) (14,300)
___________
$19,314,206
===========
Net asset value per unit $9.844
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
PORTFOLIO - See notes to portfolio.
July 31, 2000
<TABLE>
<CAPTION>
Number of Market
shares Name of Issuer of Equity Securities value
<C> <S> <C>
Apparel/Retail
22,257 The Gap, Inc. $797,090
29,164 Tommy Hilfiger Corporation 273,413
Auto & Transportation
14,690 (1) Ford Motor Company 684,010
1,912 (1) Visteon Corporation 26,768
Beverages
11,385 Anheuser-Busch Companies, Inc. 916,492
14,998 The Coca-Cola Company 919,572
23,226 PepsiCo, Inc. 1,064,053
Entertainment
31,213 The Walt Disney Company 1,207,569
Food
17,426 H.J. Heinz Company 695,960
15,080 Hershey Foods Corporation 697,450
31,862 Sara Lee Corporation 587,472
Household Products
20,103 The Clorox Company 830,515
15,155 Colgate-Palmolive Company 843,952
34,432 The Dial Corporation 436,873
14,594 Kimberly-Clark Corporation 838,250
8,131 Procter & Gamble Company 462,451
Pharmaceuticals
10,682 Bristol-Myers Squibb Company 530,094
7,871 Johnson & Johnson 732,499
17,127 Schering-Plough Corporation 739,681
Recreation
18,534 Carnival Corporation 346,363
26,539 (2) Harley-Davidson, Inc. 1,190,938
Restaurants
18,522 McDonald's Corporation 583,443
34,656 Starbucks Corporation 1,299,600
Technology
17,324 Dell Computer Corporation 761,182
21,178 (2) Intel Corporation 1,413,631
Toiletries/Cosmetics
21,576 The Gillette Company 629,760
___________
Total investments $19,509,081
===========
</TABLE>
<PAGE>
FT 371
AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
NOTES TO PORTFOLIO
July 31, 2000
(1) In June 2000, Ford Motor Company (Ford), one of the Trust's original
holdings, spun off Visteon Corporation (Visteon). Each shareholder of
Ford received .1309 shares of Visteon for each share of Ford held.
(2) The number of shares reflects the effect of a two for one stock split.
See accompanying notes to financial statements.
<PAGE>
FT 371
AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
STATEMENT OF OPERATIONS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Dividends $199,762
Expenses:
Trustee's fees and related expenses (13,979)
Evaluator's fees (3,147)
Supervisory fees (3,643)
Administrative fees (1,416)
________
Total expenses (22,185)
________
Investment income - net 177,577
Net gain (loss) on investments:
Net realized gain (loss) 1,549
Change in net unrealized appreciation
or depreciation (23,141)
________
(21,592)
________
Net increase (decrease) in net assets
resulting from operations $155,985
========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
STATEMENT OF CHANGES IN NET ASSETS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Net increase (decrease) in net assets resulting
from operations:
Investment income - net $177,577
Net realized gain (loss) on investments 1,549
Change in net unrealized appreciation
or depreciation on investments (23,141)
___________
155,985
Units issued (2,271,176 units, net of deferred
sales charges of $794,249 and net of organization
and offering costs of $13,963) 22,330,919
Unit redemptions (324,193 units) (3,193,887)
Distributions to unit holders:
Investment income - net (121,696)
Principal from investment transactions -
___________
(121,696)
___________
Total increase (decrease) in net assets 19,171,321
Net assets:
At the beginning of the period
(representing 14,997 units outstanding) 142,885
___________
At the end of the period (including
distributable funds applicable to Trust
units of $618,923 at July 31, 2000) $19,314,206
===========
Trust units outstanding at the end of
the period 1,961,980
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
NOTES TO FINANCIAL STATEMENTS
1. Significant accounting policies
Security valuation -
The equity securities are stated at the closing sale prices of listed equity
securities and the bid prices of over-the-counter traded equity securities as
reported by First Trust Advisors L.P. (the Evaluator), an affiliate of ours
(Nike Securities L.P., the Sponsor of the Trust).
Dividend income -
Dividends on each equity security are recognized on such equity security's ex-
dividend date.
Security cost -
Cost of the equity securities is based on the market value of such securities
on the dates the securities were deposited in the Trust. The cost of
securities sold is determined using the average cost method. Sales of
securities are recorded on the trade date.
Federal income taxes -
The Trust is not taxable for Federal income tax purposes. Each unit holder is
considered to be the owner of a pro rata portion of the Trust and,
accordingly, no provision has been made for Federal income taxes.
Expenses of the Trust -
The Trust pays a fee for Trustee services to The Chase Manhattan Bank, which
is based on $.0096 per annum per unit outstanding based on the largest
aggregate number of units outstanding during the year. In addition, the
Evaluator will receive an annual fee based on $.0030 per unit outstanding.
The Trust also pays recurring financial reporting costs, an annual supervisory
fee payable to an affiliate of ours and an annual administrative fee payable
to us.
Organization and offering costs -
A portion of the Public Offering Price paid by unit holders consisted of
Equity Securities in an amount sufficient to pay for all or a portion of the
costs incurred in establishing the Trust, including costs of preparing the
registration statement, the Trust indenture and other closing documents,
registering units with the Securities and Exchange Commission and states, the
initial audit of the Trust's portfolio, legal fees and the initial fees and
expenses of the Trustee. Such costs, totaling $14,300 were paid at the end of
the Trust's initial offering period.
<PAGE>
2. Unrealized appreciation and depreciation
An analysis of net unrealized depreciation at July 31, 2000 follows:
<TABLE>
<S> <C>
Unrealized depreciation $(1,676,158)
Unrealized appreciation 1,653,017
___________
$(23,141)
===========
</TABLE>
3. Other information
Cost to investors -
The cost to initial investors of units of the Trust was based on the aggregate
underlying value of the equity securities on the date of an investor's
purchase, plus a deferred sales charge of $.35 per unit which will be paid to
us over a five-month period ending on September 20, 2000, plus an initial
sales charge equal to the difference between the deferred sales charge and the
total sales charge of 4.50% of the public offering price which is equivalent
to approximately 4.545% of the net amount invested, exclusive of the deferred
sales charge. The remaining installments of the deferred sales charge are
presented as a liability in the accompanying statement of assets and
liabilities.
Distributions to unit holders -
Income distributions to unit holders are made on the last day of June and
December to unit holders of record on the fifteenth day of June and December.
Capital distributions to unit holders, if any, are made on the last day of
each month to unit holders of record on the fifteenth day of such month if the
amount available for distribution equals at least $.01 per unit.
Notwithstanding, capital distributions, if any, will be made in December of
each year.
<PAGE>
Selected data per unit of the Trust
outstanding throughout the period -
<TABLE>
<CAPTION>
Period from
the Initial
Date of
Deposit,
October 15,
1999, to
July 31,
2000
<S> <C>
Dividend income $.144
Expenses (.016)
______
Investment income - net .128
Distributions to unit holders:
Investment income - net (.070)
Principal from investment transactions -
Net gain (loss) on investments .258
______
Total increase (decrease) in net assets .316
Net assets:
Beginning of the period 9.528
______
End of the period $9.844
======
</TABLE>
Dividend income, Expenses and Investment income - net per unit have been
calculated based on the weighted-average number of units outstanding during
the period (1,382,755 units). Distributions to unit holders of Investment
income - net per unit reflects the Trust's actual distributions of
approximately $.018 per unit to 540,679 units on December 31, 1999 and
approximately $.052 per unit to 2,158,315 units on June 30, 2000. The Net
gain (loss) on investments per unit includes the effects of changes arising
from issuance of 2,271,176 additional units during the period at net asset
values which differed from the net asset value per unit of the original 14,997
units ($9.528 per unit) on October 15, 1999.
<PAGE>
FT 371
AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
PART ONE
Must be Accompanied by Part Two and Part Three
___________________
P R O S P E C T U S
___________________
SPONSOR: Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
(800) 621-1675
TRUSTEE: The Chase Manhattan Bank
4 New York Plaza, 6th Floor
New York, New York 10004-2413
LEGAL COUNSEL Chapman and Cutler
TO SPONSOR: 111 West Monroe Street
Chicago, Illinois 60603
LEGAL COUNSEL Carter, Ledyard & Milburn
TO TRUSTEE: 2 Wall Street
New York, New York 10005
INDEPENDENT Ernst & Young LLP
AUDITORS: Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
This Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, securities in any jurisdiction to any person to whom it is not
lawful to make such offer in such jurisdiction.
This Prospectus does not contain all the information set forth in the
registration statement and exhibits relating thereto, which the Trust has
filed with the Securities and Exchange Commission, Washington, D.C., under the
Securities Act of 1933 and the Investment Company Act of 1940, and to which
reference is hereby made.
<PAGE>
FT 371
BIOTECHNOLOGY PORTFOLIO SERIES
2,886,781 UNITS
PROSPECTUS
Part One
Dated November 28, 2000
Note: Part One of this Prospectus may not be distributed unless accompanied by
Part Two and Part Three.
The Trust
The Biotechnology Portfolio Series (the "Trust") is a unit investment trust
consisting of a portfolio containing common stocks issued by biotechnology and
pharmaceutical companies. At October 16, 2000, each Unit represented a
1/2,886,781 undivided interest in the principal and net income of the Trust
(see "The Trust" in Part Two).
The Units being offered by this Prospectus are issued and outstanding Units
which have been purchased by us, Nike Securities L.P., the Sponsor of the
Trust in the secondary market or from the Trustee after having been tendered
for redemption. The profit or loss resulting from the sale of Units will
accrue to us. No proceeds from the sale of Units will be received by the
Trust.
Public Offering Price
The Public Offering Price per Unit is equal to the aggregate value of the
Securities in the Portfolio of the Trust, plus or minus cash, if any, in the
Income and Capital Accounts of the Trust divided by the number of Units
outstanding, plus a sales charge of 4.5% of the Public Offering Price (4.712%
of the net amount invested) excluding income and principal cash. At October
16, 2000, the Public Offering Price per Unit was $19.097 (see "Public
Offering" in Part Two). The minimum purchase is $1,000 ($500 for Individual
Retirement Accounts or other retirement plans).
Please retain all parts of this Prospectus for future reference.
______________________________________________________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
______________________________________________________________________________
NIKE SECURITIES L.P.
Sponsor
<PAGE>
FT 371
BIOTECHNOLOGY PORTFOLIO SERIES
SUMMARY OF ESSENTIAL INFORMATION AS OF OCTOBER 16, 2000
Sponsor: Nike Securities L.P.
Evaluator: First Trust Advisors L.P.
Trustee: The Chase Manhattan Bank
<TABLE>
<CAPTION>
GENERAL INFORMATION
<S> <C>
Number of Units 2,886,781
Fractional Undivided Interest in the Trust per Unit 1/2,886,781
Public Offering Price:
Aggregate Value of Securities in the Portfolio $52,880,437
Aggregate Value of Securities per Unit $18.318
Income and Principal cash in the Portfolio $(242,922)
Income and Principal cash per Unit $(.084)
Sales Charge 4.712% (4.5% of Public Offering Price,
excluding income and principal cash) $.863
Public Offering Price per Unit $19.097
Redemption Price and our Repurchase Price per
Unit ($.863 less than the Public Offering Price
per Unit) $18.234
</TABLE>
Date Trust Established October 15, 1999
Mandatory Termination Date October 15, 2004
Evaluator's Annual Fee: $.0030 per Unit outstanding. Evaluations for
purposes of sale, purchase or redemption of Units are made as of the close of
trading (4:00 p.m. Eastern time) on the New York Stock Exchange on each day on
which it is open.
Supervisory fee payable to Maximum of $.0035 per
an affiliate of ours Unit outstanding annually
Bookkeeping and administrative expenses Maximum of $.0015 per
payable to us Unit outstanding annually
Trustee's Annual Fee: $.0096 per Unit outstanding.
Capital Distribution Record Date and Distribution Date: Distributions from
the Capital Account will be made monthly payable on the last day of the month
to Unit holders of record on the fifteenth day of such month if the amount
available for distribution equals at least $.01 per Unit. Notwithstanding,
distributions of funds in the Capital Account, if any, will be made in
December of each year.
Income Distribution Record Date: Fifteenth day of each June and December.
Income Distribution Date: The last day of each June and December.
A Unit holder who owns at least 1,000 Units may request an "In-Kind
Distribution" upon redemption or upon termination of the Trust. See "Rights
of Unit Holders - How are Income and Capital Distributed?" in Part Two.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Unit Holders of FT 371,
Biotechnology Portfolio Series
We have audited the accompanying statement of assets and liabilities,
including the portfolio, of FT 371, Biotechnology Portfolio Series at July 31,
2000, and the related statements of operations and changes in net assets for
the period from the Initial Date of Deposit, October 15, 1999, to July 31,
2000. These financial statements are the responsibility of the Trust's
Sponsor. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
July 31, 2000, by correspondence with the Trustee. An audit also includes
assessing the accounting principles used and significant estimates made by the
Sponsor, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of FT 371, Biotechnology
Portfolio Series at July 31, 2000, and the results of its operations and
changes in its net assets for the period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000, in conformity with accounting principles
generally accepted in the United States.
ERNST & YOUNG LLP
Chicago, Illinois
November 9, 2000
<PAGE>
FT 371
BIOTECHNOLOGY PORTFOLIO SERIES
STATEMENT OF ASSETS AND LIABILITIES
July 31, 2000
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Securities, at market value (cost, $36,250,550)
(Note 1) $49,629,149
Dividends receivable 3,479
Cash 82,183
Receivable from investment transactions 113,854
___________
49,828,665
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND NET ASSETS
<S> <C> <C>
Liability for deferred sales charge (Note 3) 423,346
Accrued liabilities 5,808
Unit redemptions payable 114,624
___________
543,778
___________
Net assets, applicable to 3,017,306 outstanding
units of fractional undivided interest:
Cost of Trust assets (Note 1) $36,250,550
Net unrealized appreciation (Note 2) 13,378,599
Distributable funds 1,057,287
Less deferred sales charge paid or
accrued (Note 3) (1,359,798)
Less organization and offering costs
(Note 1) (41,751)
___________
$49,284,887
===========
Net asset value per unit $16.334
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
BIOTECHNOLOGY PORTFOLIO SERIES
PORTFOLIO - See notes to portfolio.
July 31, 2000
<TABLE>
<CAPTION>
Number of Market
shares Name of Issuer of Equity Securities value
<C> <S> <C>
Biotech
9,648 Affymetrix, Inc. $1,317,405
22,992 (1) Amgen Inc. 1,493,054
40,560 (2) BioChem Pharma Inc. 905,015
12,584 Biogen, Inc. 666,952
100,322 Bio-Technology General Corp. 1,028,300
60,825 (1) Celera Genomics 5,284,172
35,361 Chiron Corporation 1,480,742
34,936 Enzon, Inc. 1,563,386
13,635 (1) Genentech, Inc. 2,074,224
24,502 Genzyme Corporation (General Division) 1,701,370
25,067 (1) Human Genome Sciences, Inc. 3,028,419
20,124 (1) IDEC Pharmaceuticals Corporation 2,471,489
67,075 (3) Immunex Corporation 3,399,898
32,805 Invitrogen Corporation 2,058,514
27,222 (3) MedImmune, Inc. 1,619,709
24,012 (1) Millennium Pharmaceuticals, Inc. 2,311,155
29,838 Protein Design Labs, Inc. 3,616,008
22,668 Transkaryotic Therapies, Inc. 600,702
Pharmaceuticals
21,787 American Home Products Corporation 1,156,084
13,841 Bristol-Myers Squibb Company 686,860
17,030 Glaxo Wellcome Plc (ADR) 972,839
10,616 Johnson & Johnson 987,957
15,052 Eli Lilly and Company 1,563,526
13,950 Merck & Co., Inc. 1,000,048
27,051 (1) Novartis AG (ADR) 1,043,168
65,454 (4) Pfizer Inc. 2,822,704
8,476 Roche Holdings AG (ADR) 796,235
22,165 Schering-Plough Corporation 957,262
15,968 SmithKline Beecham Plc (ADR) 1,021,952
___________
Total investments $49,629,149
===========
</TABLE>
<PAGE>
FT 371
BIOTECHNOLOGY PORTFOLIO SERIES
NOTES TO PORTFOLIO
July 31, 2000
(1) The number of shares reflects the effect of a two for one stock split.
(2) This Security represents the common stock of a foreign company which
trades directly on a United States national securities exchange.
(3) The number of shares reflects the effect of a three for one stock split.
(4) In June 2000, Warner Lambert Company (Warner Lambert), one of the
Trust's original holdings, was acquired by Pfizer Inc. (Pfizer), which
was also one of the Trust's original holdings. Each shareholder of
Warner Lambert received 2.75 shares of Pfizer for each share of Warner
Lambert held.
See accompanying notes to financial statements.
<PAGE>
FT 371
BIOTECHNOLOGY PORTFOLIO SERIES
STATEMENT OF OPERATIONS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Dividends $165,735
Expenses:
Trustee's fees and related expenses (26,356)
Evaluator's fees (6,618)
Supervisory fees (9,549)
Administrative fees (3,461)
___________
Total expenses (45,984)
___________
Investment income - net 119,751
Net gain (loss) on investments:
Net realized gain (loss) 3,850,826
Change in net unrealized appreciation
or depreciation 13,378,599
___________
17,229,425
___________
Net increase (decrease) in net assets
resulting from operations $17,349,176
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
BIOTECHNOLOGY PORTFOLIO SERIES
STATEMENT OF CHANGES IN NET ASSETS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Net increase (decrease) in net assets resulting
from operations:
Investment income - net $119,751
Net realized gain (loss) on investments 3,850,826
Change in net unrealized appreciation
or depreciation on investments 13,378,599
___________
17,349,176
Units issued (3,872,218 units, net of deferred
sales charges of $1,354,549 and net of organization
and offering costs of $41,414) 48,006,584
Unit redemptions (869,909 units) (16,115,954)
Distributions to unit holders:
Investment income - net (97,803)
Principal from investment transactions -
___________
(97,803)
___________
Total increase (decrease) in net assets 49,142,003
Net assets:
At the beginning of the period
(representing 14,997 units outstanding) 142,884
___________
At the end of the period (including
distributable funds applicable to Trust
units of $1,057,287 at July 31, 2000) $49,284,887
===========
Trust units outstanding at the end of
the period 3,017,306
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
BIOTECHNOLOGY PORTFOLIO SERIES
NOTES TO FINANCIAL STATEMENTS
1. Significant accounting policies
Security valuation -
The equity securities are stated at the closing sale prices of listed equity
securities and the bid prices of over-the-counter traded equity securities as
reported by First Trust Advisors L.P. (the Evaluator), an affiliate of ours
(Nike Securities L.P., the Sponsor of the Trust).
Dividend income -
Dividends on each equity security are recognized on such equity security's ex-
dividend date.
Security cost -
Cost of the equity securities is based on the market value of such securities
on the dates the securities were deposited in the Trust. The cost of
securities sold is determined using the average cost method. Sales of
securities are recorded on the trade date.
Federal income taxes -
The Trust is not taxable for Federal income tax purposes. Each unit holder is
considered to be the owner of a pro rata portion of the Trust and,
accordingly, no provision has been made for Federal income taxes.
Expenses of the Trust -
The Trust pays a fee for Trustee services to The Chase Manhattan Bank, which
is based on $.0096 per annum per unit outstanding based on the largest
aggregate number of units outstanding during the year. In addition, the
Evaluator will receive an annual fee based on $.0030 per unit outstanding.
The Trust also pays recurring financial reporting costs, an annual supervisory
fee payable to an affiliate of ours and an annual administrative fee payable
to us.
Organization and offering costs -
A portion of the Public Offering Price paid by unit holders consisted of
Equity Securities in an amount sufficient to pay for all or a portion of the
costs incurred in establishing the Trust, including costs of preparing the
registration statement, the Trust indenture and other closing documents,
registering units with the Securities and Exchange Commission and states, the
initial audit of the Trust's portfolio, legal fees and the initial fees and
expenses of the Trustee. Such costs, totaling $41,751 were paid at the end of
the Trust's initial offering period.
<PAGE>
2. Unrealized appreciation and depreciation
An analysis of net unrealized appreciation at July 31, 2000 follows:
<TABLE>
<S> <C>
Unrealized appreciation $14,973,914
Unrealized depreciation (1,595,315)
___________
$13,378,599
===========
</TABLE>
3. Other information
Cost to investors -
The cost to initial investors of units of the Trust was based on the aggregate
underlying value of the equity securities on the date of an investor's
purchase, plus a deferred sales charge of $.35 per unit which will be paid to
us over a five-month period ending on September 20, 2000, plus an initial
sales charge equal to the difference between the deferred sales charge and the
total sales charge of 4.50% of the public offering price which is equivalent
to approximately 4.545% of the net amount invested, exclusive of the deferred
sales charge. The remaining installments of the deferred sales charge are
presented as a liability in the accompanying statement of assets and
liabilities.
Distributions to unit holders -
Income distributions to unit holders are made on the last day of June and
December to unit holders of record on the fifteenth day of June and December.
Capital distributions to unit holders, if any, are made on the last day of
each month to unit holders of record on the fifteenth day of such month if the
amount available for distribution equals at least $.01 per unit.
Notwithstanding, capital distributions, if any, will be made in December of
each year.
<PAGE>
Selected data per unit of the Trust
outstanding throughout the period -
<TABLE>
<CAPTION>
Period from
the Initial
Date of
Deposit,
October 15,
1999, to
July 31,
2000
<S> <C>
Dividend income $.057
Expenses (.016)
_______
Investment income - net .041
Distributions to unit holders:
Investment income - net (.032)
Principal from investment transactions -
Net gain (loss) on investments 6.797
_______
Total increase (decrease) in net assets 6.806
Net assets:
Beginning of the period 9.528
_______
End of the period $16.334
=======
</TABLE>
Dividend income, Expenses and Investment income - net per unit have been
calculated based on the weighted-average number of units outstanding during
the period (2,926,657 units). Distributions to unit holders of Investment
income - net per unit reflects the Trust's actual distributions of
approximately $.032 per unit to 3,095,038 units on June 30, 2000. The Net
gain (loss) on investments per unit includes the effects of changes arising
from issuance of 3,872,218 additional units during the period at net asset
values which differed from the net asset value per unit of the original 14,997
units ($9.528 per unit) on October 15, 1999.
<PAGE>
FT 371
BIOTECHNOLOGY PORTFOLIO SERIES
PART ONE
Must be Accompanied by Part Two and Part Three
___________________
P R O S P E C T U S
___________________
SPONSOR: Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
(800) 621-1675
TRUSTEE: The Chase Manhattan Bank
4 New York Plaza, 6th Floor
New York, New York 10004-2413
LEGAL COUNSEL Chapman and Cutler
TO SPONSOR: 111 West Monroe Street
Chicago, Illinois 60603
LEGAL COUNSEL Carter, Ledyard & Milburn
TO TRUSTEE: 2 Wall Street
New York, New York 10005
INDEPENDENT Ernst & Young LLP
AUDITORS: Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
This Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, securities in any jurisdiction to any person to whom it is not
lawful to make such offer in such jurisdiction.
This Prospectus does not contain all the information set forth in the
registration statement and exhibits relating thereto, which the Trust has
filed with the Securities and Exchange Commission, Washington, D.C., under the
Securities Act of 1933 and the Investment Company Act of 1940, and to which
reference is hereby made.
<PAGE>
FT 371
COMMUNICATIONS PORTFOLIO, SERIES 5
4,880,172 UNITS
PROSPECTUS
Part One
Dated November 28, 2000
Note: Part One of this Prospectus may not be distributed unless accompanied by
Part Two and Part Three.
The Trust
The Communications Portfolio, Series 5 (the "Trust") is a unit investment
trust consisting of a portfolio containing common stocks issued by companies
involved in the communications industry. At October 16, 2000, each Unit
represented a 1/4,880,172 undivided interest in the principal and net income
of the Trust (see "The Trust" in Part Two).
The Units being offered by this Prospectus are issued and outstanding Units
which have been purchased by us, Nike Securities L.P., the Sponsor of the
Trust in the secondary market or from the Trustee after having been tendered
for redemption. The profit or loss resulting from the sale of Units will
accrue to us. No proceeds from the sale of Units will be received by the
Trust.
Public Offering Price
The Public Offering Price per Unit is equal to the aggregate value of the
Securities in the Portfolio of the Trust, plus or minus cash, if any, in the
Income and Capital Accounts of the Trust divided by the number of Units
outstanding, plus a sales charge of 4.5% of the Public Offering Price (4.712%
of the net amount invested) excluding income and principal cash. At October
16, 2000, the Public Offering Price per Unit was $16.076 (see "Public
Offering" in Part Two). The minimum purchase is $1,000 ($500 for Individual
Retirement Accounts or other retirement plans).
Please retain all parts of this Prospectus for future reference.
______________________________________________________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
______________________________________________________________________________
NIKE SECURITIES L.P.
Sponsor
<PAGE>
FT 371
COMMUNICATIONS PORTFOLIO, SERIES 5
SUMMARY OF ESSENTIAL INFORMATION AS OF OCTOBER 16, 2000
Sponsor: Nike Securities L.P.
Evaluator: First Trust Advisors L.P.
Trustee: The Chase Manhattan Bank
<TABLE>
<CAPTION>
GENERAL INFORMATION
<S> <C>
Number of Units 4,880,172
Fractional Undivided Interest in the Trust per Unit 1/4,880,172
Public Offering Price:
Aggregate Value of Securities in the Portfolio $74,969,763
Aggregate Value of Securities per Unit $15.362
Income and Principal cash (overdraft) in the Portfolio $(47,724)
Income and Principal cash (overdraft) per Unit $(.010)
Sales Charge 4.712% (4.5% of Public Offering Price,
excluding income and principal cash) $.724
Public Offering Price per Unit $16.076
Redemption Price and our Repurchase Price per
Unit ($.724 less than the Public Offering Price
per Unit) $15.352
</TABLE>
Date Trust Established October 15, 1999
Mandatory Termination Date October 15, 2004
Evaluator's Annual Fee: $.0030 per Unit outstanding. Evaluations for
purposes of sale, purchase or redemption of Units are made as of the close of
trading (4:00 p.m. Eastern time) on the New York Stock Exchange on each day on
which it is open.
Supervisory fee payable to Maximum of $.0035 per
an affiliate of ours Unit outstanding annually
Bookkeeping and administrative expenses Maximum of $.0015 per
payable to us Unit outstanding annually
Trustee's Annual Fee: $.0096 per Unit outstanding.
Capital Distribution Record Date and Distribution Date: Distributions from
the Capital Account will be made monthly payable on the last day of the month
to Unit holders of record on the fifteenth day of such month if the amount
available for distribution equals at least $.01 per Unit. Notwithstanding,
distributions of funds in the Capital Account, if any, will be made in
December of each year.
Income Distribution Record Date: Fifteenth day of each June and December.
Income Distribution Date: The last day of each June and December.
A Unit holder who owns at least 1,000 Units may request an "In-Kind
Distribution" upon redemption or upon termination of the Trust. See "Rights
of Unit Holders - How are Income and Capital Distributed?" in Part Two.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Unit Holders of FT 371,
Communications Portfolio, Series 5
We have audited the accompanying statement of assets and liabilities,
including the portfolio, of FT 371, Communications Portfolio, Series 5 at July
31, 2000, and the related statements of operations and changes in net assets
for the period from the Initial Date of Deposit, October 15, 1999, to July 31,
2000. These financial statements are the responsibility of the Trust's
Sponsor. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
July 31, 2000, by correspondence with the Trustee. An audit also includes
assessing the accounting principles used and significant estimates made by the
Sponsor, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of FT 371, Communications
Portfolio, Series 5 at July 31, 2000, and the results of its operations and
changes in its net assets for the period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000, in conformity with accounting principles
generally accepted in the United States.
ERNST & YOUNG LLP
Chicago, Illinois
November 9, 2000
<PAGE>
FT 371
COMMUNICATIONS PORTFOLIO, SERIES 5
STATEMENT OF ASSETS AND LIABILITIES
July 31, 2000
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Securities, at market value (cost, $64,481,078)
(Note 1) $85,390,859
Dividends receivable 35,105
Cash 110,168
Receivable from investment transactions 133,939
___________
85,670,071
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND NET ASSETS
<S> <C> <C>
Liability for deferred sales charge (Note 3) 715,561
Accrued liabilities 9,204
Unit redemptions payable 130,116
___________
854,881
___________
Net assets, applicable to 5,103,623 outstanding
units of fractional undivided interest:
Cost of Trust assets (Note 1) $64,481,078
Net unrealized appreciation (Note 2) 20,909,781
Distributable funds 1,471,313
Less deferred sales charge paid or
accrued (Note 3) (1,979,231)
Less organization and offering costs
(Note 1) (67,751)
___________
$84,815,190
===========
Net asset value per unit $16.619
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
COMMUNICATIONS PORTFOLIO, SERIES 5
PORTFOLIO - See notes to portfolio.
July 31, 2000
<TABLE>
<CAPTION>
Number of Market
shares Name of Issuer of Equity Securities value
<C> <S> <C>
Communications Services
27,413 ALLTEL Corporation 1,689,326
43,512 AT&T Corp. 1,346,174
45,241 BellSouth Corporation 1,801,180
59,545 Cable & Wireless Plc (ADR) 3,129,864
46,023 Deutsche Telekom AG (ADR) 2,002,001
58,166 Qwest Communications International Inc. 2,730,196
38,503 SBC Communications Inc. 1,638,803
42,045 (1) Telefonica S.A. (ADR) 2,661,995
31,481 Verizon Communications, Inc. (formerly
Bell Atlantic Corporation) 1,479,607
40,608 (2) WorldCom, Inc. (formerly MCI WorldCom, Inc.) 1,586,270
Data Networking/Communications Equipment
170,092 (3) ADC Telecommunications, Inc. 7,133,318
66,388 (4) Applied Micro Circuits Corporation 9,908,409
32,819 (4) Broadcom Corporation (Class A) 7,359,661
57,048 (4) Cisco Systems, Inc. 3,733,107
40,781 (4) Comverse Technology, Inc. 3,578,533
69,357 (5) ECI Telecom Limited 2,470,843
32,046 Lucent Technologies Inc. 1,402,012
69,640 (4)(5) Nortel Networks Corporation 5,179,475
47,501 (4)(5) PMC-Sierra, Inc. 9,209,256
34,326 Tellabs, Inc. 2,231,190
48,872 Vitesse Semiconductor Corporation 2,913,993
Wireless Communications
65,577 (6) Motorola, Inc. 2,168,172
83,387 (7) Nokia Oy (ADR) 3,695,128
40,562 (7) QUALCOMM Incorporated 2,634,016
40,196 Vodafone AirTouch Plc (ADR) 1,708,330
___________
Total investments $85,390,859
===========
</TABLE>
<PAGE>
FT 371
COMMUNICATIONS PORTFOLIO, SERIES 5
NOTES TO PORTFOLIO
July 31, 2000
(1) The number of shares reflects the effect of a 2% stock dividend.
(2) The number of shares reflects the effect of a three for two stock split.
(3) The number of shares reflects the effect of two two for one stock
splits.
(4) The number of shares reflects the effect of a two for one stock split.
(5) This Security represents the common stock of a foreign company which
trades directly on a United States national securities exchange.
(6) The number of shares reflects the effect of a three for one stock split.
(7) The number of shares reflects the effect of a four for one stock split.
See accompanying notes to financial statements.
<PAGE>
FT 371
COMMUNICATIONS PORTFOLIO, SERIES 5
STATEMENT OF OPERATIONS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Dividends $233,104
Expenses:
Trustee's fees and related expenses (39,330)
Evaluator's fees (9,581)
Supervisory fees (13,597)
Administrative fees (4,946)
___________
Total expenses (67,454)
___________
Investment income - net 165,650
Net gain (loss) on investments:
Net realized gain (loss) 623,186
Change in net unrealized appreciation
or depreciation 20,909,781
___________
21,532,967
___________
Net increase (decrease) in net assets
resulting from operations $21,698,617
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
COMMUNICATIONS PORTFOLIO, SERIES 5
STATEMENT OF CHANGES IN NET ASSETS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Net increase (decrease) in net assets resulting
from operations:
Investment income - net $165,650
Net realized gain (loss) on investments 623,186
Change in net unrealized appreciation
or depreciation on investments 20,909,781
___________
21,698,617
Units issued (5,641,186 units, net of deferred
sales charges of $1,973,977 and net of organization
and offering costs of $67,413) 69,858,561
Unit redemptions (552,574 units) (6,786,260)
Distributions to unit holders:
Investment income - net (98,742)
Principal from investment transactions -
___________
(98,742)
___________
Total increase (decrease) in net assets 84,672,176
Net assets:
At the beginning of the period
(representing 15,011 units outstanding) 143,014
___________
At the end of the period (including
distributable funds applicable to Trust
units of $1,471,313 at July 31, 2000) $84,815,190
===========
Trust units outstanding at the end of
the period 5,103,623
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
COMMUNICATIONS PORTFOLIO, SERIES 5
NOTES TO FINANCIAL STATEMENTS
1. Significant accounting policies
Security valuation -
The equity securities are stated at the closing sale prices of listed equity
securities and the bid prices of over-the-counter traded equity securities as
reported by First Trust Advisors L.P. (the Evaluator), an affiliate of ours
(Nike Securities L.P., the Sponsor of the Trust).
Dividend income -
Dividends on each equity security are recognized on such equity security's ex-
dividend date.
Security cost -
Cost of the equity securities is based on the market value of such securities
on the dates the securities were deposited in the Trust. The cost of
securities sold is determined using the average cost method. Sales of
securities are recorded on the trade date.
Federal income taxes -
The Trust is not taxable for Federal income tax purposes. Each unit holder is
considered to be the owner of a pro rata portion of the Trust and,
accordingly, no provision has been made for Federal income taxes.
Expenses of the Trust -
The Trust pays a fee for Trustee services to The Chase Manhattan Bank, which
is based on $.0096 per annum per unit outstanding based on the largest
aggregate number of units outstanding during the year. In addition, the
Evaluator will receive an annual fee based on $.0030 per unit outstanding.
The Trust also pays recurring financial reporting costs, an annual supervisory
fee payable to an affiliate of ours and an annual administrative fee payable
to us.
Organization and offering costs -
A portion of the Public Offering Price paid by unit holders consisted of
Equity Securities in an amount sufficient to pay for all or a portion of the
costs incurred in establishing the Trust, including costs of preparing the
registration statement, the Trust indenture and other closing documents,
registering units with the Securities and Exchange Commission and states, the
initial audit of the Trust's portfolio, legal fees and the initial fees and
expenses of the Trustee. Such costs, totaling $67,751 were paid at the end of
the Trust's initial offering period.
<PAGE>
2. Unrealized appreciation and depreciation
An analysis of net unrealized appreciation at July 31, 2000 follows:
<TABLE>
<S> <C>
Unrealized appreciation $27,612,269
Unrealized depreciation (6,702,488)
___________
$20,909,781
===========
</TABLE>
3. Other information
Cost to investors -
The cost to initial investors of units of the Trust was based on the aggregate
underlying value of the equity securities on the date of an investor's
purchase, plus a deferred sales charge of $.35 per unit which will be paid to
us over a five-month period ending on September 20, 2000, plus an initial
sales charge equal to the difference between the deferred sales charge and the
total sales charge of 4.50% of the public offering price which is equivalent
to approximately 4.545% of the net amount invested, exclusive of the deferred
sales charge. The remaining installments of the deferred sales charge are
presented as a liability in the accompanying statement of assets and
liabilities.
Distributions to unit holders -
Income distributions to unit holders are made on the last day of June and
December to unit holders of record on the fifteenth day of June and December.
Capital distributions to unit holders, if any, are made on the last day of
each month to unit holders of record on the fifteenth day of such month if the
amount available for distribution equals at least $.01 per unit.
Notwithstanding, capital distributions, if any, will be made in December of
each year.
<PAGE>
Selected data per unit of the Trust
outstanding throughout the period -
<TABLE>
<CAPTION>
Period from
the Initial
Date of
Deposit,
October 15,
1999, to
July 31,
2000
<S> <C>
Dividend income $.052
Expenses (.015)
_______
Investment income - net .037
Distributions to unit holders:
Investment income - net (.019)
Principal from investment transactions -
Net gain (loss) on investments 7.074
_______
Total increase (decrease) in net assets 7.092
Net assets:
Beginning of the period 9.527
_______
End of the period $16.619
=======
</TABLE>
Dividend income, Expenses and Investment income - net per unit have been
calculated based on the weighted-average number of units outstanding during
the period (4,484,631 units). Distributions to unit holders of Investment
income - net per unit reflects the Trust's actual distribution of
approximately $.019 per unit to 5,224,465 units on June 30, 2000. The Net
gain (loss) on investments per unit includes the effects of changes arising
from issuance of 5,641,186 additional units during the period at net asset
values which differed from the net asset value per unit of the original 15,011
units ($9.527 per unit) on October 15, 1999.
<PAGE>
FT 371
COMMUNICATIONS PORTFOLIO, SERIES 5
PART ONE
Must be Accompanied by Part Two and Part Three
___________________
P R O S P E C T U S
___________________
SPONSOR: Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
(800) 621-1675
TRUSTEE: The Chase Manhattan Bank
4 New York Plaza, 6th Floor
New York, New York 10004-2413
LEGAL COUNSEL Chapman and Cutler
TO SPONSOR: 111 West Monroe Street
Chicago, Illinois 60603
LEGAL COUNSEL Carter, Ledyard & Milburn
TO TRUSTEE: 2 Wall Street
New York, New York 10005
INDEPENDENT Ernst & Young LLP
AUDITORS: Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
This Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, securities in any jurisdiction to any person to whom it is not
lawful to make such offer in such jurisdiction.
This Prospectus does not contain all the information set forth in the
registration statement and exhibits relating thereto, which the Trust has
filed with the Securities and Exchange Commission, Washington, D.C., under the
Securities Act of 1933 and the Investment Company Act of 1940, and to which
reference is hereby made.
<PAGE>
FT 371
e-TAIL PORTFOLIO SERIES
1,736,038 UNITS
PROSPECTUS
Part One
Dated November 28, 2000
Note: Part One of this Prospectus may not be distributed unless accompanied by
Part Two and Part Three.
The Trust
The e-Tail Portfolio Series (the "Trust") is a unit investment trust
consisting of a portfolio containing common stocks issued by companies
involved in electronic commerce. At October 16, 2000, each Unit represented a
1/1,736,038 undivided interest in the principal and net income of the Trust
(see "The Trust" in Part Two).
The Units being offered by this Prospectus are issued and outstanding Units
which have been purchased by us, Nike Securities L.P., the Sponsor of the
Trust in the secondary market or from the Trustee after having been tendered
for redemption. The profit or loss resulting from the sale of Units will
accrue to us. No proceeds from the sale of Units will be received by the
Trust.
Public Offering Price
The Public Offering Price per Unit is equal to the aggregate value of the
Securities in the Portfolio of the Trust, plus or minus cash, if any, in the
Income and Capital Accounts of the Trust divided by the number of Units
outstanding, plus a sales charge of 4.5% of the Public Offering Price (4.712%
of the net amount invested) excluding income and principal cash. At October
16, 2000, the Public Offering Price per Unit was $12.292 (see "Public
Offering" in Part Two). The minimum purchase is $1,000 ($500 for Individual
Retirement Accounts or other retirement plans).
Please retain all parts of this Prospectus for future reference.
______________________________________________________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
______________________________________________________________________________
NIKE SECURITIES L.P.
Sponsor
<PAGE>
FT 371
e-TAIL PORTFOLIO SERIES
SUMMARY OF ESSENTIAL INFORMATION AS OF OCTOBER 16, 2000
Sponsor: Nike Securities L.P.
Evaluator: First Trust Advisors L.P.
Trustee: The Chase Manhattan Bank
<TABLE>
<CAPTION>
GENERAL INFORMATION
<S> <C>
Number of Units 1,736,038
Fractional Undivided Interest in the Trust per Unit 1/1,736,038
Aggregate Value of Securities in the Portfolio $20,441,845
Aggregate Value of Securities per Unit $11.775
Income and Principal cash (overdraft) in the Portfolio $(66,606)
Income and Principal cash (overdraft) per Unit $(.038)
Sales Charge 4.712% (4.5% of Public Offering Price,
excluding income and principal cash) $.555
Public Offering Price per Unit $12.292
Redemption Price and our Repurchase Price per
Unit ($.555 less than the Public Offering Price
per Unit) $11.737
</TABLE>
Date Trust Established October 15, 1999
Mandatory Termination Date October 15, 2004
Evaluator's Annual Fee: $.0030 per Unit outstanding. Evaluations for
purposes of sale, purchase or redemption of Units are made as of the close of
trading (4:00 p.m. Eastern time) on the New York Stock Exchange on each day on
which it is open.
Supervisory fee payable to Maximum of $.0035 per
an affiliate of ours Unit outstanding annually
Bookkeeping and administrative expenses Maximum of $.0015 per
payable to us Unit outstanding annually
Trustee's Annual Fee: $.0096 per Unit outstanding.
Capital Distribution Record Date and Distribution Date: Distributions from
the Capital Account will be made monthly payable on the last day of the month
to Unit holders of record on the fifteenth day of such month if the amount
available for distribution equals at least $.01 per Unit. Notwithstanding,
distributions of funds in the Capital Account, if any, will be made in
December of each year.
Income Distribution Record Date: Fifteenth day of each June and December.
Income Distribution Date: The last day of each June and December.
A Unit holder who owns at least 1,000 Units may request an "In-Kind
Distribution" upon redemption or upon termination of the Trust. See "Rights
of Unit Holders - How are Income and Capital Distributed?" in Part Two.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Unit Holders of FT 371,
e-Tail Portfolio Series
We have audited the accompanying statement of assets and liabilities,
including the portfolio, of FT 371, e-Tail Portfolio Series at July 31, 2000,
and the related statements of operations and changes in net assets for the
period from the Initial Date of Deposit, October 15, 1999, to July 31, 2000.
These financial statements are the responsibility of the Trust's Sponsor. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
July 31, 2000, by correspondence with the Trustee. An audit also includes
assessing the accounting principles used and significant estimates made by the
Sponsor, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of FT 371, e-Tail Portfolio
Series at July 31, 2000, and the results of its operations and changes in its
net assets for the period from the Initial Date of Deposit, October 15, 1999,
to July 31, 2000, in conformity with accounting principles generally accepted
in the United States.
ERNST & YOUNG LLP
Chicago, Illinois
November 9, 2000
<PAGE>
FT 371
e-TAIL PORTFOLIO SERIES
STATEMENT OF ASSETS AND LIABILITIES
July 31, 2000
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Securities, at market value (cost, $20,805,262)
(Note 1) $24,871,003
Dividends receivable 4,261
Receivable from investment transactions 243,182
___________
25,118,446
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND NET ASSETS
<S> <C> <C>
Liability for deferred sales charge (Note 3) 262,269
Accrued liabilities 3,625
Cash overdraft 52,817
Unit redemptions payable 198,866
___________
517,577
___________
Net assets, applicable to 1,858,889 outstanding
units of fractional undivided interest:
Cost of Trust assets (Note 1) $20,805,262
Net unrealized appreciation (Note 2) 4,065,741
Distributable funds 581,851
Less deferred sales charge paid or
accrued (Note 3) (815,627)
Less organization and offering costs
(Note 1) (36,358)
___________
$24,600,869
===========
Net asset value per unit $13.234
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
e-TAIL PORTFOLIO SERIES
PORTFOLIO - See notes to portfolio.
July 31, 2000
<TABLE>
<CAPTION>
Number of Market
shares Name of Issuer of Equity Securities value
<C> <S> <C>
Access Providers & Portals
13,063 AT&T Corp. $404,143
10,461 (1) America Online, Inc. 557,707
22,752 (2) EarthLink, Inc. 284,400
17,747 Qwest Communications International Inc. 833,009
7,182 (1) Yahoo! Inc. 924,237
12,232 (3) WorldCom, Inc. (formerly MCI WorldCom, Inc.) 477,819
e-Tailers
7,279 Amazon.com, Inc. 219,280
25,022 (1) CDW Computer Centers, Inc. 1,205,760
13,529 Dell Computer Corporation 594,437
8,471 (1) eBay Inc. 423,550
17,489 The Gap, Inc. 626,334
10,892 Gateway Inc. 601,108
27,988 (1) Intimate Brands, Inc. 488,055
8,061 Lands' End, Inc. 301,788
31,243 (3) The Charles Schwab Corporation 1,128,653
11,470 Wal-Mart Stores, Inc. 630,139
Financial/Transactional Services
12,828 (4) American Express Company 727,194
15,406 Capital One Financial Corporation 903,177
14,174 First Data Corporation 652,897
7,088 Providian Financial Corporation 722,537
Internet Infrastructure
2,826 (5) Agilent Technologies, Inc. 115,160
34,515 (6) BroadVision, Inc. 1,249,029
17,838 (1) Cisco Systems, Inc. 1,167,283
17,587 (1) EMC Corporation 1,497,093
38,069 (7) Exodus Communications, Inc. 1,691,710
7,442 (5) Hewlett-Packard Company 812,577
16,854 (1) Intel Corporation 1,125,004
5,727 International Business Machines Corporation 643,932
6,545 Microsoft Corporation 456,926
26,208 (1) Oracle Corporation 1,970,527
13,615 (1) Sun Microsystems, Inc. 1,435,538
___________
Total investments $24,871,003
===========
</TABLE>
<PAGE>
FT 371
e-TAIL PORTFOLIO SERIES
NOTES TO PORTFOLIO
July 31, 2000
(1) The number of shares reflects the effect of a two for one stock split.
(2) In January 2000, Earthlink Network, Inc. (Earthlink), one of the Trust's
original holdings, was acquired by Mindspring Enterprises, Inc.
(Mindspring). Each shareholder of Earthlink received 1.615 shares of
Mindspring for each of Earthlink held. Concurrently, Mindspring changed
the name of the combined company to Earthlink, Inc.
(3) The number of shares reflects the effect of a three for two stock split.
(4) The number of shares reflects the effect of a three for one stock split.
(5) In May 2000, Hewlett-Packard Company (HP), one of the Trust's original
holdings, spun off Agilent Technologies, Inc. (Agilent). Each
shareholder of HP received .3814 shares of Agilent for each share of HP
held.
(6) The number of shares reflects the effect of two three for one stock
splits.
(7) The number of shares reflects the effect of two two for one stock
splits.
See accompanying notes to financial statements.
<PAGE>
FT 371
e-TAIL PORTFOLIO SERIES
STATEMENT OF OPERATIONS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Dividends $37,334
Expenses:
Trustee's fees and related expenses (17,533)
Evaluator's fees (4,035)
Supervisory fees (6,064)
Administrative fees (2,076)
__________
Total expenses (29,708)
__________
Investment income - net 7,626
Net gain (loss) on investments:
Net realized gain (loss) 1,266,798
Change in net unrealized appreciation
or depreciation 4,065,741
__________
5,332,539
__________
Net increase (decrease) in net assets
resulting from operations $5,340,165
==========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
e-TAIL PORTFOLIO SERIES
STATEMENT OF CHANGES IN NET ASSETS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Net increase (decrease) in net assets resulting
from operations:
Investment income - net $7,626
Net realized gain (loss) on investments 1,266,798
Change in net unrealized appreciation
or depreciation on investments 4,065,741
___________
5,340,165
Units issued (2,315,347 units, net of deferred
sales charges of $810,371 and net of organization
and offering costs of $36,020) 25,808,121
Unit redemptions (471,475 units) (6,690,492)
Distributions to unit holders:
Investment income - net -
Principal from investment transactions -
___________
-
___________
Total increase (decrease) in net assets 24,457,794
Net assets:
At the beginning of the period
(representing 15,017 units outstanding) 143,075
___________
At the end of the period (including
distributable funds applicable to Trust
units of $581,851 at July 31, 2000) $24,600,869
===========
Trust units outstanding at the end of
the period 1,858,889
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
e-TAIL PORTFOLIO SERIES
NOTES TO FINANCIAL STATEMENTS
1. Significant accounting policies
Security valuation -
The equity securities are stated at the closing sale prices of listed equity
securities and the bid prices of over-the-counter traded equity securities as
reported by First Trust Advisors L.P. (the Evaluator), an affiliate of ours
(Nike Securities L.P., the Sponsor of the Trust).
Dividend income -
Dividends on each equity security are recognized on such equity security's ex-
dividend date.
Security cost -
Cost of the equity securities is based on the market value of such securities
on the dates the securities were deposited in the Trust. The cost of
securities sold is determined using the average cost method. Sales of
securities are recorded on the trade date.
Federal income taxes -
The Trust is not taxable for Federal income tax purposes. Each unit holder is
considered to be the owner of a pro rata portion of the Trust and,
accordingly, no provision has been made for Federal income taxes.
Expenses of the Trust -
The Trust pays a fee for Trustee services to The Chase Manhattan Bank, which
is based on $.0096 per annum per unit outstanding based on the largest
aggregate number of units outstanding during the year. In addition, the
Evaluator will receive an annual fee based on $.0030 per unit outstanding.
The Trust also pays recurring financial reporting costs, an annual supervisory
fee payable to an affiliate of ours and an annual administrative fee payable
to us.
Organization and offering costs -
A portion of the Public Offering Price paid by unit holders consisted of
Equity Securities in an amount sufficient to pay for all or a portion of the
costs incurred in establishing the Trust, including costs of preparing the
registration statement, the Trust indenture and other closing documents,
registering units with the Securities and Exchange Commission and states, the
initial audit of the Trust's portfolio, legal fees and the initial fees and
expenses of the Trustee. Such costs, totaling $36,358 were paid at the end of
the Trust's initial offering period.
<PAGE>
2. Unrealized appreciation and depreciation
An analysis of net unrealized appreciation at July 31, 2000 follows:
<TABLE>
<S> <C>
Unrealized appreciation $6,336,255
Unrealized depreciation (2,270,514)
__________
$4,065,741
==========
</TABLE>
3. Other information
Cost to investors -
The cost to initial investors of units of the Trust was based on the aggregate
underlying value of the equity securities on the date of an investor's
purchase, plus a deferred sales charge of $.35 per unit which will be paid to
us over a five-month period ending on September 20, 2000, plus an initial
sales charge equal to the difference between the deferred sales charge and the
total sales charge of 4.50% of the public offering price which is equivalent
to approximately 4.545% of the net amount invested, exclusive of the deferred
sales charge. The remaining installments of the deferred sales charge are
presented as a liability in the accompanying statement of assets and
liabilities.
Distributions to unit holders -
Income distributions to unit holders are made on the last day of June and
December to unit holders of record on the fifteenth day of June and December.
Capital distributions to unit holders, if any, are made on the last day of
each month to unit holders of record on the fifteenth day of such month if the
amount available for distribution equals at least $.01 per unit.
Notwithstanding, capital distributions, if any, will be made in December of
each year. The Trust made no distributions during the period ended July 31,
2000.
<PAGE>
Selected data per unit of the Trust
outstanding throughout the period -
<TABLE>
<CAPTION>
Period from
the Initial
Date of
Deposit,
October 15,
1999, to
July 31,
2000
<S> <C>
Dividend income $.019
Expenses (.015)
_______
Investment income - net .004
Distributions to unit holders:
Investment income - net -
Principal from investment transactions -
Net gain (loss) on investments 3.702
_______
Total increase (decrease) in net assets 3.706
Net assets:
Beginning of the period 9.528
_______
End of the period $13.234
=======
</TABLE>
Dividend income, Expenses and Investment income - net per unit have been
calculated based on the weighted-average number of units outstanding during
the period (1,974,596 units). The Net gain (loss) on investments per unit
includes the effects of changes arising from issuance of 2,315,347 additional
units during the period at net asset values which differed from the net asset
value per unit of the original 15,017 units ($9.528 per unit) on October 15,
1999.
<PAGE>
FT 371
e-TAIL PORTFOLIO SERIES
PART ONE
Must be Accompanied by Part Two and Part Three
___________________
P R O S P E C T U S
___________________
SPONSOR: Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
(800) 621-1675
TRUSTEE: The Chase Manhattan Bank
4 New York Plaza, 6th Floor
New York, New York 10004-2413
LEGAL COUNSEL Chapman and Cutler
TO SPONSOR: 111 West Monroe Street
Chicago, Illinois 60603
LEGAL COUNSEL Carter, Ledyard & Milburn
TO TRUSTEE: 2 Wall Street
New York, New York 10005
INDEPENDENT Ernst & Young LLP
AUDITORS: Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
This Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, securities in any jurisdiction to any person to whom it is not
lawful to make such offer in such jurisdiction.
This Prospectus does not contain all the information set forth in the
registration statement and exhibits relating thereto, which the Trust has
filed with the Securities and Exchange Commission, Washington, D.C., under the
Securities Act of 1933 and the Investment Company Act of 1940, and to which
reference is hereby made.
<PAGE>
FT 371
INTERNET PORTFOLIO, SERIES 8
4,991,762 UNITS
PROSPECTUS
Part One
Dated November 28, 2000
Note: Part One of this Prospectus may not be distributed unless accompanied by
Part Two and Part Three.
The Trust
The Internet Portfolio, Series 8 (the "Trust") is a unit investment trust
consisting of a portfolio containing common stocks issued by companies which
provide products or services for, or conduct business on, the internet. At
October 16, 2000, each Unit represented a 1/4,991,762 undivided interest in
the principal and net income of the Trust (see "The Trust" in Part Two).
The Units being offered by this Prospectus are issued and outstanding Units
which have been purchased by us, Nike Securities L.P., the Sponsor of the
Trust in the secondary market or from the Trustee after having been tendered
for redemption. The profit or loss resulting from the sale of Units will
accrue to us. No proceeds from the sale of Units will be received by the
Trust.
Public Offering Price
The Public Offering Price per Unit is equal to the aggregate value of the
Securities in the Portfolio of the Trust, plus or minus cash, if any, in the
Income and Capital Accounts of the Trust divided by the number of Units
outstanding, plus a sales charge of 4.5% of the Public Offering Price (4.712%
of the net amount invested) excluding income and principal cash. At October
16, 2000, the Public Offering Price per Unit was $17.077 (see "Public
Offering" in Part Two). The minimum purchase is $1,000 ($500 for Individual
Retirement Accounts or other retirement plans).
Please retain all parts of this Prospectus for future reference.
______________________________________________________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
______________________________________________________________________________
NIKE SECURITIES L.P.
Sponsor
<PAGE>
FT 371
INTERNET PORTFOLIO, SERIES 8
SUMMARY OF ESSENTIAL INFORMATION AS OF OCTOBER 16, 2000
Sponsor: Nike Securities L.P.
Evaluator: First Trust Advisors L.P.
Trustee: The Chase Manhattan Bank
<TABLE>
<CAPTION>
GENERAL INFORMATION
<S> <C>
Number of Units 4,991,762
Fractional Undivided Interest in the Trust per Unit 1/4,991,762
Aggregate Value of Securities in the Portfolio $81,590,513
Aggregate Value of Securities per Unit $16.345
Income and Principal cash (overdraft) in the Portfolio $(190,136)
Income and Principal cash (overdraft) per Unit $(.038)
Sales Charge 4.712% (4.5% of Public Offering Price,
excluding income and principal cash) $.770
Public Offering Price per Unit $17.077
Redemption Price and our Repurchase Price per
Unit ($.770 less than the Public Offering Price
per Unit) $16.307
</TABLE>
Date Trust Established October 15, 1999
Mandatory Termination Date October 15, 2004
Evaluator's Annual Fee: $.0030 per Unit outstanding. Evaluations for
purposes of sale, purchase or redemption of Units are made as of the close of
trading (4:00 p.m. Eastern time) on the New York Stock Exchange on each day on
which it is open.
Supervisory fee payable to Maximum of $.0035 per
an affiliate of ours Unit outstanding annually
Bookkeeping and administrative expenses Maximum of $.0015 per
payable to us Unit outstanding annually
Trustee's Annual Fee: $.0096 per Unit outstanding.
Capital Distribution Record Date and Distribution Date: Distributions from
the Capital Account will be made monthly payable on the last day of the month
to Unit holders of record on the fifteenth day of such month if the amount
available for distribution equals at least $.01 per Unit. Notwithstanding,
distributions of funds in the Capital Account, if any, will be made in
December of each year.
Income Distribution Record Date: Fifteenth day of each June and December.
Income Distribution Date: The last day of each June and December.
A Unit holder who owns at least 1,000 Units may request an "In-Kind
Distribution" upon redemption or upon termination of the Trust. See "Rights
of Unit Holders - How are Income and Capital Distributed?" in Part Two.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Unit Holders of FT 371,
Internet Portfolio, Series 8
We have audited the accompanying statement of assets and liabilities,
including the portfolio, of FT 371, Internet Portfolio, Series 8 at July 31,
2000, and the related statements of operations and changes in net assets for
the period from the Initial Date of Deposit, October 15, 1999, to July 31,
2000. These financial statements are the responsibility of the Trust's
Sponsor. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
July 31, 2000, by correspondence with the Trustee. An audit also includes
assessing the accounting principles used and significant estimates made by the
Sponsor, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of FT 371, Internet Portfolio,
Series 8 at July 31, 2000, and the results of its operations and changes in
its net assets for the period from the Initial Date of Deposit, October 15,
1999, to July 31, 2000, in conformity with accounting principles generally
accepted in the United States.
ERNST & YOUNG LLP
Chicago, Illinois
November 9, 2000
<PAGE>
FT 371
INTERNET PORTFOLIO, SERIES 8
STATEMENT OF ASSETS AND LIABILITIES
July 31, 2000
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Securities, at market value (cost, $67,737,545)
(Note 1) $94,319,065
Dividends receivable 9,070
Cash 142,962
Receivable from investment transactions 43,524
___________
94,514,621
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND NET ASSETS
<S> <C> <C>
Liability for deferred sales charge (Note 3) 741,391
Accrued liabilities 9,770
Unit redemptions payable 44,270
___________
795,431
___________
Net assets, applicable to 5,293,091 outstanding
units of fractional undivided interest:
Cost of Trust assets (Note 1) $67,737,545
Net unrealized appreciation (Note 2) 26,581,520
Distributable funds 1,644,024
Less deferred sales charge paid or
accrued (Note 3) (2,167,871)
Less organization and offering costs
(Note 1) (76,028)
___________
$93,719,190
===========
Net asset value per unit $17.706
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
INTERNET PORTFOLIO, SERIES 8
PORTFOLIO - See notes to portfolio.
July 31, 2000
<TABLE>
<CAPTION>
Number of Market
shares Name of Issuer of Equity Securities value
<C> <S> <C>
Access/Information Providers
37,921 AT&T Corp. $1,173,200
30,069 (1) America Online, Inc. 1,603,069
65,862 (2) EarthLink, Inc. 823,275
48,255 Qwest Communications International Inc. 2,264,993
34,388 (3) WorldCom, Inc. (formerly MCI WorldCom, Inc.) 1,343,298
Data Networking/Communications Equipment
28,582 (1) Broadcom Corporation (Class A) 6,409,514
49,565 (1) Cisco Systems, Inc. 3,243,434
26,942 Lucent Technologies Inc. 1,178,712
61,935 (1)(4) Nortel Networks Corporation 4,606,416
41,823 (1)(4) PMC-Sierra, Inc. 8,108,434
29,556 Tellabs, Inc. 1,921,140
42,187 Vitesse Semiconductor Corporation 2,515,400
Computers & Peripherals
7,972 (5) Agilent Technologies, Inc. 324,859
38,814 Dell Computer Corporation 1,705,410
49,749 (1) EMC Corporation 4,234,884
31,842 Gateway Inc. 1,757,296
20,724 (5) Hewlett-Packard Company 2,262,812
47,176 (1) Intel Corporation 3,148,998
16,087 International Business Machines Corporation 1,808,790
38,234 (1) Sun Microsystems, Inc. 4,031,316
Internet Content
34,118 (1) CMGI Inc. 1,294,369
59,840 (1) TMP Worldwide Inc. 4,308,480
20,288 (1) Yahoo! Inc. 2,610,822
Online Brokerage
72,601 Knight/Trimark Group, Inc. (Class A) 1,928,500
87,241 (3) The Charles Schwab Corporation 3,151,581
Software
95,653 (6) BroadVision, Inc. 3,461,491
79,798 (4)(7) Check Point Software Technologies Ltd. 9,256,568
107,039 (7) Exodus Communications, Inc. 4,756,599
64,445 Intuit Inc. 2,191,130
18,873 Microsoft Corporation 1,317,581
74,170 (1) Oracle Corporation 5,576,694
___________
Total investments $94,319,065
===========
</TABLE>
<PAGE>
FT 371
INTERNET PORTFOLIO, SERIES 8
NOTES TO PORTFOLIO
July 31, 2000
(1) The number of shares reflects the effect of a two for one stock split.
(2) In January 2000, Earthlink Network, Inc. (Earthlink), one of the Trust's
original holdings, was acquired by Mindspring Enterprises, Inc.
(Mindspring). Each shareholder of Earthlink received 1.615 shares of
Mindspring for each of Earthlink held. Concurrently, Mindspring changed
the name of the combined company to Earthlink, Inc.
(3) The number of shares reflects the effect of a three for two stock split.
(4) This Security represents the common stock of a foreign company which
trades directly on a United States national securities exchange.
(5) In May 2000, Hewlett-Packard Company (HP), one of the Trust's original
holdings, spun off Agilent Technologies, Inc. (Agilent). Each
shareholder of HP received .3814 shares of Agilent for each share of HP
held.
(6) The number of shares reflects the effect of two three for one stock
splits.
(7) The number of shares reflects the effect of two two for one stock
splits.
See accompanying notes to financial statements.
<PAGE>
FT 371
INTERNET PORTFOLIO, SERIES 8
STATEMENT OF OPERATIONS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Dividends $55,402
Expenses:
Trustee's fees and related expenses (46,379)
Evaluator's fees (10,793)
Supervisory fees (15,808)
Administrative fees (6,305)
___________
Total expenses (79,285)
___________
Investment income (loss) - net (23,883)
Net gain (loss) on investments:
Net realized gain (loss) 5,449,156
Change in net unrealized appreciation
or depreciation 26,581,520
___________
32,030,676
___________
Net increase (decrease) in net assets
resulting from operations $32,006,793
===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
INTERNET PORTFOLIO, SERIES 8
STATEMENT OF CHANGES IN NET ASSETS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Net increase (decrease) in net assets resulting
from operations:
Investment income (loss) - net $(23,883)
Net realized gain (loss) on investments 5,449,156
Change in net unrealized appreciation
or depreciation on investments 26,581,520
___________
32,006,793
Units issued (6,178,895 units, net of deferred
sales charges of $2,162,613 and net of organization
and offering costs of $75,690) 77,685,731
Unit redemptions (900,827 units) (16,116,468)
Distributions to unit holders:
Investment income - net -
Principal from investment transactions -
___________
-
___________
Total increase (decrease) in net assets 93,576,056
Net assets:
At the beginning of the period
(representing 15,023 units outstanding) 143,134
___________
At the end of the period (including
distributable funds applicable to Trust
units of $1,644,024 at July 31, 2000) $93,719,190
===========
Trust units outstanding at the end of
the period 5,293,091
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
INTERNET PORTFOLIO, SERIES 8
NOTES TO FINANCIAL STATEMENTS
1. Significant accounting policies
Security valuation -
The equity securities are stated at the closing sale prices of listed equity
securities and the bid prices of over-the-counter traded equity securities as
reported by First Trust Advisors L.P. (the Evaluator), an affiliate of ours
(Nike Securities L.P., the Sponsor of the Trust).
Dividend income -
Dividends on each equity security are recognized on such equity security's ex-
dividend date.
Security cost -
Cost of the equity securities is based on the market value of such securities
on the dates the securities were deposited in the Trust. The cost of
securities sold is determined using the average cost method. Sales of
securities are recorded on the trade date.
Federal income taxes -
The Trust is not taxable for Federal income tax purposes. Each unit holder is
considered to be the owner of a pro rata portion of the Trust and,
accordingly, no provision has been made for Federal income taxes.
Expenses of the Trust -
The Trust pays a fee for Trustee services to The Chase Manhattan Bank, which
is based on $.0096 per annum per unit outstanding based on the largest
aggregate number of units outstanding during the year. In addition, the
Evaluator will receive an annual fee based on $.0030 per unit outstanding.
The Trust also pays recurring financial reporting costs, an annual supervisory
fee payable to an affiliate of ours and an annual administrative fee payable
to us.
Organization and offering costs -
A portion of the Public Offering Price paid by unit holders consisted of
Equity Securities in an amount sufficient to pay for all or a portion of the
costs incurred in establishing the Trust, including costs of preparing the
registration statement, the Trust indenture and other closing documents,
registering units with the Securities and Exchange Commission and states, the
initial audit of the Trust's portfolio, legal fees and the initial fees and
expenses of the Trustee. Such costs, totaling $76,028 were paid at the end of
the Trust's initial offering period.
<PAGE>
2. Unrealized appreciation and depreciation
An analysis of net unrealized appreciation at July 31, 2000 follows:
<TABLE>
<S> <C>
Unrealized appreciation $33,893,860
Unrealized depreciation (7,312,340)
___________
$26,581,520
===========
</TABLE>
3. Other information
Cost to investors -
The cost to initial investors of units of the Trust was based on the aggregate
underlying value of the equity securities on the date of an investor's
purchase, plus a deferred sales charge of $.35 per unit which will be paid to
us over a five-month period ending on September 20, 2000, plus an initial
sales charge equal to the difference between the deferred sales charge and the
total sales charge of 4.50% of the public offering price which is equivalent
to approximately 4.545% of the net amount invested, exclusive of the deferred
sales charge. The remaining installments of the deferred sales charge are
presented as a liability in the accompanying statement of assets and
liabilities.
Distributions to unit holders -
Income distributions to unit holders are made on the last day of June and
December to unit holders of record on the fifteenth day of June and December.
Capital distributions to unit holders, if any, are made on the last day of
each month to unit holders of record on the fifteenth day of such month if the
amount available for distribution equals at least $.01 per unit.
Notwithstanding, capital distributions, if any, will be made in December of
each year. The Trust made no distributions during the period ended July 31,
2000.
<PAGE>
Selected data per unit of the Trust
outstanding throughout the period -
<TABLE>
<CAPTION>
Period from
the Initial
Date of
Deposit,
October 15,
1999, to
July 31,
2000
<S> <C>
Dividend income $.011
Expenses (.016)
_______
Investment income (loss) - net (.005)
Distributions to unit holders:
Investment income - net -
Principal from investment transactions -
Net gain (loss) on investments 8.183
_______
Total increase (decrease) in net assets 8.178
Net assets:
Beginning of the period 9.528
_______
End of the period $17.706
=======
</TABLE>
Dividend income, Expenses and Investment income (loss) - net per unit have
been calculated based on the weighted-average number of units outstanding
during the period (5,095,835 units). The Net gain (loss) on investments per
unit includes the effects of changes arising from issuance of 6,178,895
additional units during the period at net asset values which differed from the
net asset value per unit of the original 15,023 units ($9.528 per unit) on
October 15, 1999.
<PAGE>
FT 371
INTERNET PORTFOLIO, SERIES 8
PART ONE
Must be Accompanied by Part Two and Part Three
___________________
P R O S P E C T U S
___________________
SPONSOR: Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
(800) 621-1675
TRUSTEE: The Chase Manhattan Bank
4 New York Plaza, 6th Floor
New York, New York 10004-2413
LEGAL COUNSEL Chapman and Cutler
TO SPONSOR: 111 West Monroe Street
Chicago, Illinois 60603
LEGAL COUNSEL Carter, Ledyard & Milburn
TO TRUSTEE: 2 Wall Street
New York, New York 10005
INDEPENDENT Ernst & Young LLP
AUDITORS: Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
This Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, securities in any jurisdiction to any person to whom it is not
lawful to make such offer in such jurisdiction.
This Prospectus does not contain all the information set forth in the
registration statement and exhibits relating thereto, which the Trust has
filed with the Securities and Exchange Commission, Washington, D.C., under the
Securities Act of 1933 and the Investment Company Act of 1940, and to which
reference is hereby made.
<PAGE>
FT 371
MARKET LEADERS PORTFOLIO, SERIES 4
686,330 UNITS
PROSPECTUS
Part One
Dated November 28, 2000
Note: Part One of this Prospectus may not be distributed unless accompanied by
Part Two and Part Three.
The Trust
The Market Leaders Portfolio, Series 4 (the "Trust") is a unit investment
trust consisting of a portfolio containing common stocks issued by companies
considered to be leaders in their industry. At October 16, 2000, each Unit
represented a 1/686,330 undivided interest in the principal and net income of
the Trust (see "The Trust" in Part Two).
The Units being offered by this Prospectus are issued and outstanding Units
which have been purchased by us, Nike Securities L.P., the Sponsor of the
Trust in the secondary market or from the Trustee after having been tendered
for redemption. The profit or loss resulting from the sale of Units will
accrue to us. No proceeds from the sale of Units will be received by the
Trust.
Public Offering Price
The Public Offering Price per Unit is equal to the aggregate value of the
Securities in the Portfolio of the Trust, plus or minus cash, if any, in the
Income and Capital Accounts of the Trust divided by the number of Units
outstanding, plus a sales charge of 4.5% of the Public Offering Price (4.712%
of the net amount invested) excluding income and principal cash. At October
16, 2000, the Public Offering Price per Unit was $11.121 (see "Public
Offering" in Part Two). The minimum purchase is $1,000 ($500 for Individual
Retirement Accounts or other retirement plans).
Please retain all parts of this Prospectus for future reference.
______________________________________________________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
______________________________________________________________________________
NIKE SECURITIES L.P.
Sponsor
<PAGE>
FT 371
MARKET LEADERS PORTFOLIO, SERIES 4
SUMMARY OF ESSENTIAL INFORMATION AS OF OCTOBER 16, 2000
Sponsor: Nike Securities L.P.
Evaluator: First Trust Advisors L.P.
Trustee: The Chase Manhattan Bank
<TABLE>
<CAPTION>
GENERAL INFORMATION
<S> <C>
Number of Units 686,330
Fractional Undivided Interest in the Trust per Unit 1/686,330
Aggregate Value of Securities in the Portfolio $7,352,824
Aggregate Value of Securities per Unit $10.713
Income and Principal cash (overdraft) in the Portfolio $(66,789)
Income and Principal cash (overdraft) per Unit $(.097)
Sales Charge 4.712% (4.5% of Public Offering Price,
excluding income and principal cash) $.505
Public Offering Price per Unit $11.121
Redemption Price and our Repurchase Price per
Unit ($.505 less than the Public Offering Price
per Unit) $10.616
</TABLE>
Date Trust Established October 15, 1999
Mandatory Termination Date October 15, 2004
Evaluator's Annual Fee: $.0030 per Unit outstanding. Evaluations for
purposes of sale, purchase or redemption of Units are made as of the close of
trading (4:00 p.m. Eastern time) on the New York Stock Exchange on each day on
which it is open.
Supervisory fee payable to Maximum of $.0035 per
an affiliate of ours Unit outstanding annually
Bookkeeping and administrative expenses Maximum of $.0015 per
payable to us Unit outstanding annually
Trustee's Annual Fee: $.0096 per Unit outstanding.
Capital Distribution Record Date and Distribution Date: Distributions from
the Capital Account will be made monthly payable on the last day of the month
to Unit holders of record on the fifteenth day of such month if the amount
available for distribution equals at least $.01 per Unit. Notwithstanding,
distributions of funds in the Capital Account, if any, will be made in
December of each year.
Income Distribution Record Date: Fifteenth day of each June and December.
Income Distribution Date: The last day of each June and December.
A Unit holder who owns at least 1,000 Units may request an "In-Kind
Distribution" upon redemption or upon termination of the Trust. See "Rights
of Unit Holders - How are Income and Capital Distributed?" in Part Two.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Unit Holders of FT 371,
Market Leaders Portfolio, Series 4
We have audited the accompanying statement of assets and liabilities,
including the portfolio, of FT 371, Market Leaders Portfolio, Series 4 at July
31, 2000, and the related statements of operations and changes in net assets
for the period from the Initial Date of Deposit, October 15, 1999, to July 31,
2000. These financial statements are the responsibility of the Trust's
Sponsor. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
July 31, 2000, by correspondence with the Trustee. An audit also includes
assessing the accounting principles used and significant estimates made by the
Sponsor, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of FT 371, Market Leaders
Portfolio, Series 4 at July 31, 2000, and the results of its operations and
changes in its net assets for the period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000, in conformity with accounting principles
generally accepted in the United States.
ERNST & YOUNG LLP
Chicago, Illinois
November 9, 2000
<PAGE>
FT 371
MARKET LEADERS PORTFOLIO, SERIES 4
STATEMENT OF ASSETS AND LIABILITIES
July 31, 2000
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Securities, at market value (cost, $7,663,096)
(Note 1) $7,716,897
Dividends receivable 7,924
Cash 23,797
Receivable from investment transactions 16,821
__________
7,765,439
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND NET ASSETS
<S> <C> <C>
Liability for deferred sales charge (Note 3) 104,515
Accrued liabilities 1,260
Unit redemptions payable 92
__________
105,867
__________
Net assets, applicable to 746,529 outstanding
units of fractional undivided interest:
Cost of Trust assets (Note 1) $7,663,096
Net unrealized appreciation (Note 2) 53,801
Distributable funds 201,966
Less deferred sales charge paid or
accrued (Note 3) (253,091)
Less organization and offering costs
(Note 1) (6,200)
__________
$7,659,572
==========
Net asset value per unit $10.260
==========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
MARKET LEADERS PORTFOLIO, SERIES 4
PORTFOLIO - See notes to portfolio.
July 31, 2000
<TABLE>
<CAPTION>
Number of Market
shares Name of Issuer of Equity Securities value
<C> <S> <C>
19,392 (1) American Express Company $1,099,294
490 Berkshire Hathaway Inc. (Class B) 894,250
17,971 The Coca-Cola Company 1,101,856
36,722 The Walt Disney Company 1,420,701
17,972 Freddie Mac 708,780
24,657 The Gillette Company 719,688
1,762 The Washington Post Company (Class B) 845,760
22,428 Wells Fargo Company 926,568
__________
Total investments $7,716,897
==========
</TABLE>
<PAGE>
FT 371
MARKET LEADERS PORTFOLIO, SERIES 4
NOTES TO PORTFOLIO
July 31, 2000
(1) The number of shares reflects the effect of a two for one stock split.
See accompanying notes to financial statements.
<PAGE>
FT 371
MARKET LEADERS PORTFOLIO, SERIES 4
STATEMENT OF OPERATIONS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Dividends $52,623
Expenses:
Trustee's fees and related expenses (4,845)
Evaluator's fees (966)
Supervisory fees (1,347)
Administrative fees (517)
________
Total expenses (7,675)
________
Investment income - net 44,948
Net gain (loss) on investments:
Net realized gain (loss) 28,018
Change in net unrealized appreciation
or depreciation 53,801
________
81,819
________
Net increase (decrease) in net assets
resulting from operations $126,767
========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
MARKET LEADERS PORTFOLIO, SERIES 4
STATEMENT OF CHANGES IN NET ASSETS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Net increase (decrease) in net assets resulting
from operations:
Investment income - net $44,948
Net realized gain (loss) on investments 28,018
Change in net unrealized appreciation
or depreciation on investments 53,801
__________
126,767
Units issued (731,473 units, net of deferred
sales charges of $247,818 and net of organization
and offering costs of $5,861) 7,420,707
Unit redemptions (9 units) (92)
Distributions to unit holders:
Investment income - net (31,340)
Principal from investment transactions -
__________
(31,340)
__________
Total increase (decrease) in net assets 7,516,042
Net assets:
At the beginning of the period
(representing 15,065 units outstanding) 143,530
__________
At the end of the period (including
distributable funds applicable to Trust
units of $201,966 at July 31, 2000) $7,659,572
==========
Trust units outstanding at the end of
the period 746,529
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
MARKET LEADERS PORTFOLIO, SERIES 4
NOTES TO FINANCIAL STATEMENTS
1. Significant accounting policies
Security valuation -
The equity securities are stated at the closing sale prices of listed equity
securities and the bid prices of over-the-counter traded equity securities as
reported by First Trust Advisors L.P. (the Evaluator), an affiliate of ours
(Nike Securities L.P., the Sponsor of the Trust).
Dividend income -
Dividends on each equity security are recognized on such equity security's ex-
dividend date.
Security cost -
Cost of the equity securities is based on the market value of such securities
on the dates the securities were deposited in the Trust. The cost of
securities sold is determined using the average cost method. Sales of
securities are recorded on the trade date.
Federal income taxes -
The Trust is not taxable for Federal income tax purposes. Each unit holder is
considered to be the owner of a pro rata portion of the Trust and,
accordingly, no provision has been made for Federal income taxes.
Expenses of the Trust -
The Trust pays a fee for Trustee services to The Chase Manhattan Bank, which
is based on $.0096 per annum per unit outstanding based on the largest
aggregate number of units outstanding during the year. In addition, the
Evaluator will receive an annual fee based on $.0030 per unit outstanding.
The Trust also pays recurring financial reporting costs, an annual supervisory
fee payable to an affiliate of ours and an annual administrative fee payable
to us.
Organization and offering costs -
A portion of the Public Offering Price paid by unit holders consisted of
Equity Securities in an amount sufficient to pay for all or a portion of the
costs incurred in establishing the Trust, including costs of preparing the
registration statement, the Trust indenture and other closing documents,
registering units with the Securities and Exchange Commission and states, the
initial audit of the Trust's portfolio, legal fees and the initial fees and
expenses of the Trustee. Such costs, totaling $6,200 were paid at the end of
the Trust's initial offering period.
<PAGE>
2. Unrealized appreciation and depreciation
An analysis of net unrealized appreciation at July 31, 2000 follows:
<TABLE>
<S> <C>
Unrealized appreciation $452,480
Unrealized depreciation (398,679)
________
$53,801
========
</TABLE>
3. Other information
Cost to investors -
The cost to initial investors of units of the Trust was based on the aggregate
underlying value of the equity securities on the date of an investor's
purchase, plus a deferred sales charge of $.35 per unit which will be paid to
us over a five-month period ending on September 20, 2000, plus an initial
sales charge equal to the difference between the deferred sales charge and the
total sales charge of 4.50% of the public offering price which is equivalent
to approximately 4.545% of the net amount invested, exclusive of the deferred
sales charge. The remaining installments of the deferred sales charge are
presented as a liability in the accompanying statement of assets and
liabilities.
Distributions to unit holders -
Income distributions to unit holders are made on the last day of June and
December to unit holders of record on the fifteenth day of June and December.
Capital distributions to unit holders, if any, are made on the last day of
each month to unit holders of record on the fifteenth day of such month if the
amount available for distribution equals at least $.01 per unit.
Notwithstanding, capital distributions, if any, will be made in December of
each year. The Trust made no distributions during the period ended July 31,
2000.
<PAGE>
Selected data per unit of the Trust
outstanding throughout the period -
<TABLE>
<CAPTION>
Period from
the Initial
Date of
Deposit,
October 15,
1999, to
July 31,
2000
<S> <C>
Dividend income $.117
Expenses (.017)
_______
Investment income - net .100
Distributions to unit holders:
Investment income - net (.061)
Principal from investment transactions -
Net gain (loss) on investments .694
_______
Total increase (decrease) in net assets .733
Net assets:
Beginning of the period 9.527
_______
End of the period $10.260
=======
</TABLE>
Dividend income, Expenses and Investment income - net per unit have been
calculated based on the weighted-average number of units outstanding during
the period (447,742 units). Distributions to unit holders of Investment
income - net per unit reflects the Trust's actual distributions of
approximately $.026 per unit to 219,570 units on December 31, 1999 and
approximately $.035 per unit to 731,900 units on June 30, 2000. The Net gain
(loss) on investments per unit includes the effects of changes arising from
issuance of 731,473 additional units during the period at net asset values
which differed from the net asset value per unit of the original 15,065 units
($9.527 per unit) on October 15, 1999.
<PAGE>
FT 371
MARKET LEADERS PORTFOLIO, SERIES 4
PART ONE
Must be Accompanied by Part Two and Part Three
___________________
P R O S P E C T U S
___________________
SPONSOR: Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
(800) 621-1675
TRUSTEE: The Chase Manhattan Bank
4 New York Plaza, 6th Floor
New York, New York 10004-2413
LEGAL COUNSEL Chapman and Cutler
TO SPONSOR: 111 West Monroe Street
Chicago, Illinois 60603
LEGAL COUNSEL Carter, Ledyard & Milburn
TO TRUSTEE: 2 Wall Street
New York, New York 10005
INDEPENDENT Ernst & Young LLP
AUDITORS: Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
This Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, securities in any jurisdiction to any person to whom it is not
lawful to make such offer in such jurisdiction.
This Prospectus does not contain all the information set forth in the
registration statement and exhibits relating thereto, which the Trust has
filed with the Securities and Exchange Commission, Washington, D.C., under the
Securities Act of 1933 and the Investment Company Act of 1940, and to which
reference is hereby made.
<PAGE>
FT 371
RETAIL PORTFOLIO, SERIES 4
560,097 UNITS
PROSPECTUS
Part One
Dated November 28, 2000
Note: Part One of this Prospectus may not be distributed unless accompanied by
Part Two and Part Three.
The Trust
The Retail Portfolio, Series 4 (the "Trust") is a unit investment trust
consisting of a portfolio containing common stocks issued by retail companies.
At October 16, 2000, each Unit represented a 1/560,097 undivided interest in
the principal and net income of the Trust (see "The Trust" in Part Two).
The Units being offered by this Prospectus are issued and outstanding Units
which have been purchased by us, Nike Securities L.P., the Sponsor of the
Trust in the secondary market or from the Trustee after having been tendered
for redemption. The profit or loss resulting from the sale of Units will
accrue to us. No proceeds from the sale of Units will be received by the
Trust.
Public Offering Price
The Public Offering Price per Unit is equal to the aggregate value of the
Securities in the Portfolio of the Trust, plus or minus cash, if any, in the
Income and Capital Accounts of the Trust divided by the number of Units
outstanding, plus a sales charge of 4.5% of the Public Offering Price (4.712%
of the net amount invested) excluding income and principal cash. At October
16, 2000, the Public Offering Price per Unit was $9.324 (see "Public Offering"
in Part Two). The minimum purchase is $1,000 ($500 for Individual Retirement
Accounts or other retirement plans).
Please retain all parts of this Prospectus for future reference.
______________________________________________________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
______________________________________________________________________________
NIKE SECURITIES L.P.
Sponsor
<PAGE>
FT 371
RETAIL PORTFOLIO, SERIES 4
SUMMARY OF ESSENTIAL INFORMATION AS OF OCTOBER 16, 2000
Sponsor: Nike Securities L.P.
Evaluator: First Trust Advisors L.P.
Trustee: The Chase Manhattan Bank
<TABLE>
<CAPTION>
GENERAL INFORMATION
<S> <C>
Number of Units 560,097
Fractional Undivided Interest in the Trust per Unit 1/560,097
Aggregate Value of Securities in the Portfolio $5,237,290
Aggregate Value of Securities per Unit $9.351
Income and Principal cash (overdraft) in the Portfolio $(15,237)
Income and Principal cash (overdraft) per Unit $(.027)
Sales Charge 4.712% (4.5% of Public Offering Price,
excluding income and principal cash) $.441
Public Offering Price per Unit $9.765
Redemption Price and our Repurchase Price per
Unit ($.441 less than the Public Offering Price
per Unit) $9.324
</TABLE>
Date Trust Established October 15, 1999
Mandatory Termination Date October 15, 2004
Evaluator's Annual Fee: $.0030 per Unit outstanding. Evaluations for
purposes of sale, purchase or redemption of Units are made as of the close of
trading (4:00 p.m. Eastern time) on the New York Stock Exchange on each day on
which it is open.
Supervisory fee payable to Maximum of $.0035 per
an affiliate of ours Unit outstanding annually
Bookkeeping and administrative expenses Maximum of $.0015 per
payable to us Unit outstanding annually
Trustee's Annual Fee: $.0096 per Unit outstanding.
Capital Distribution Record Date and Distribution Date: Distributions from
the Capital Account will be made monthly payable on the last day of the month
to Unit holders of record on the fifteenth day of such month if the amount
available for distribution equals at least $.01 per Unit. Notwithstanding,
distributions of funds in the Capital Account, if any, will be made in
December of each year.
Income Distribution Record Date: Fifteenth day of each June and December.
Income Distribution Date: The last day of each June and December.
A Unit holder who owns at least 1,000 Units may request an "In-Kind
Distribution" upon redemption or upon termination of the Trust. See "Rights
of Unit Holders - How are Income and Capital Distributed?" in Part Two.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Unit Holders of FT 371,
Retail Portfolio, Series 4
We have audited the accompanying statement of assets and liabilities,
including the portfolio, of FT 371, Retail Portfolio, Series 4 at July 31,
2000, and the related statements of operations and changes in net assets for
the period from the Initial Date of Deposit, October 15, 1999, to July 31,
2000. These financial statements are the responsibility of the Trust's
Sponsor. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
July 31, 2000, by correspondence with the Trustee. An audit also includes
assessing the accounting principles used and significant estimates made by the
Sponsor, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of FT 371, Retail Portfolio,
Series 4 at July 31, 2000, and the results of its operations and changes in
its net assets for the period from the Initial Date of Deposit, October 15,
1999, to July 31, 2000, in conformity with accounting principles generally
accepted in the United States.
ERNST & YOUNG LLP
Chicago, Illinois
November 9, 2000
<PAGE>
FT 371
RETAIL PORTFOLIO, SERIES 4
STATEMENT OF ASSETS AND LIABILITIES
July 31, 2000
<TABLE>
<CAPTION>
ASSETS
<S> <C>
Securities, at market value (cost, $6,220,688)
(Note 1) $5,892,280
Receivable from investment transactions 106,949
__________
5,999,229
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND NET ASSETS
<S> <C> <C>
Liability for deferred sales charge (Note 3) 86,690
Accrued liabilities 961
Cash overdraft 1,477
Unit redemptions payable 92,412
__________
181,540
__________
Net assets, applicable to 609,858 outstanding
units of fractional undivided interest:
Cost of Trust assets (Note 1) $6,220,688
Net unrealized depreciation (Note 2) (328,408)
Distributable funds 131,880
Less deferred sales charge paid or
accrued (Note 3) (199,871)
Less organization and offering costs
(Note 1) (6,600)
__________
$5,817,689
==========
Net asset value per unit $9.539
==========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
RETAIL PORTFOLIO, SERIES 4
PORTFOLIO - See notes to portfolio.
July 31, 2000
<TABLE>
<CAPTION>
Number of Market
shares Name of Issuer of Equity Securities value
<C> <S> <C>
11,814 Abercrombie & Fitch Co. (Class A) $189,768
10,107 BJ's Wholesale Club, Inc. 302,583
9,438 Bed Bath & Beyond Inc. 347,441
12,523 (1) CDW Computer Centers, Inc. 603,458
6,382 Circuit City Stores - Circuit City Group 146,390
7,815 (1) Costco Wholesale Corporation 254,480
13,304 (2) Dollar General Corporation 244,461
12,158 (3) Dollar Tree Stores, Inc. 517,481
8,804 The Gap, Inc. 315,298
11,260 Tommy Hilfiger Corporation 105,562
6,458 (3) The Home Depot, Inc. 334,202
14,052 (1) Intimate Brands, Inc. 245,039
13,789 The Kroger Co. 285,267
6,070 Lowe's Companies, Inc. 256,081
8,233 The May Department Stores Company 195,534
8,552 Safeway Inc. 385,379
13,702 Staples, Inc. 189,266
9,189 (1) Target Corporation (formerly Dayton
Hudson Corporation) 266,481
12,560 Walgreen Co. 391,721
5,759 Wal-Mart Stores, Inc. 316,388
__________
Total investments $5,892,280
==========
</TABLE>
<PAGE>
FT 371
RETAIL PORTFOLIO, SERIES 4
NOTES TO PORTFOLIO
July 31, 2000
(1) The number of shares reflects the effect of a two for one stock split.
(2) The number of shares reflects the effect of a five for four stock split.
(3) The number of shares reflects the effect of a three for two stock split.
See accompanying notes to financial statements.
<PAGE>
FT 371
RETAIL PORTFOLIO, SERIES 4
STATEMENT OF OPERATIONS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Dividends $13,119
Expenses:
Trustee's fees and related expenses (3,771)
Evaluator's fees (817)
Supervisory fees (1,201)
Administrative fees (436)
_________
Total expenses (6,225)
_________
Investment income - net 6,894
Net gain (loss) on investments:
Net realized gain (loss) (10,585)
Change in net unrealized appreciation
or depreciation (328,408)
_________
(338,993)
_________
Net increase (decrease) in net assets
resulting from operations $(332,099)
=========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
RETAIL PORTFOLIO, SERIES 4
STATEMENT OF CHANGES IN NET ASSETS
Period from the Initial Date of Deposit,
October 15, 1999, to July 31, 2000
<TABLE>
<S> <C>
Net increase (decrease) in net assets resulting
from operations:
Investment income - net $6,894
Net realized gain (loss) on investments (10,585)
Change in net unrealized appreciation
or depreciation on investments (328,408)
__________
(332,099)
Units issued (604,188 units, net of deferred
sales charges of $194,612 and net of organization
and offering costs of $6,262) 6,099,045
Unit redemptions (9,355 units) (92,412)
Distributions to unit holders:
Investment income - net -
Principal from investment transactions -
__________
-
__________
Total increase (decrease) in net assets 5,674,534
Net assets:
At the beginning of the period
(representing 15,025 units outstanding) 143,155
__________
At the end of the period (including
distributable funds applicable to Trust
units of $131,880 at July 31, 2000) $5,817,689
==========
Trust units outstanding at the end of
the period 609,858
</TABLE>
See accompanying notes to financial statements.
<PAGE>
FT 371
RETAIL PORTFOLIO, SERIES 4
NOTES TO FINANCIAL STATEMENTS
1. Significant accounting policies
Security valuation -
The equity securities are stated at the closing sale prices of listed equity
securities and the bid prices of over-the-counter traded equity securities as
reported by First Trust Advisors L.P. (the Evaluator), an affiliate of ours
(Nike Securities L.P., the Sponsor of the Trust).
Dividend income -
Dividends on each equity security are recognized on such equity security's ex-
dividend date.
Security cost -
Cost of the equity securities is based on the market value of such securities
on the dates the securities were deposited in the Trust. The cost of
securities sold is determined using the average cost method. Sales of
securities are recorded on the trade date.
Federal income taxes -
The Trust is not taxable for Federal income tax purposes. Each unit holder is
considered to be the owner of a pro rata portion of the Trust and,
accordingly, no provision has been made for Federal income taxes.
Expenses of the Trust -
The Trust pays a fee for Trustee services to The Chase Manhattan Bank, which
is based on $.0096 per annum per unit outstanding based on the largest
aggregate number of units outstanding during the year. In addition, the
Evaluator will receive an annual fee based on $.0030 per unit outstanding.
The Trust also pays recurring financial reporting costs, an annual supervisory
fee payable to an affiliate of ours and an annual administrative fee payable
to us.
Organization and offering costs -
A portion of the Public Offering Price paid by unit holders consisted of
Equity Securities in an amount sufficient to pay for all or a portion of the
costs incurred in establishing the Trust, including costs of preparing the
registration statement, the Trust indenture and other closing documents,
registering units with the Securities and Exchange Commission and states, the
initial audit of the Trust's portfolio, legal fees and the initial fees and
expenses of the Trustee. Such costs, totaling $6,600 were paid at the end of
the Trust's initial offering period.
<PAGE>
2. Unrealized appreciation and depreciation
An analysis of net unrealized depreciation at July 31, 2000 follows:
<TABLE>
<S> <C>
Unrealized depreciation $(738,346)
Unrealized appreciation 409,938
_________
$(328,408)
=========
</TABLE>
3. Other information
Cost to investors -
The cost to initial investors of units of the Trust was based on the aggregate
underlying value of the equity securities on the date of an investor's
purchase, plus a deferred sales charge of $.35 per unit which will be paid to
us over a five-month period ending on September 20, 2000, plus an initial
sales charge equal to the difference between the deferred sales charge and the
total sales charge of 4.50% of the public offering price which is equivalent
to approximately 4.545% of the net amount invested, exclusive of the deferred
sales charge. The remaining installments of the deferred sales charge are
presented as a liability in the accompanying statement of assets and
liabilities.
Distributions to unit holders -
Income distributions to unit holders are made on the last day of June and
December to unit holders of record on the fifteenth day of June and December.
Capital distributions to unit holders, if any, are made on the last day of
each month to unit holders of record on the fifteenth day of such month if the
amount available for distribution equals at least $.01 per unit.
Notwithstanding, capital distributions, if any, will be made in December of
each year. The Trust made no distributions during the period ended July 31,
2000.
<PAGE>
Selected data per unit of the Trust
outstanding throughout the period -
<TABLE>
<CAPTION>
Period from
the Initial
Date of
Deposit,
October 15,
1999, to
July 31,
2000
<S> <C>
Dividend income $.032
Expenses (.015)
______
Investment income - net .017
Distributions to unit holders:
Investment income - net -
Principal from investment transactions -
Net gain (loss) on investments (.006)
______
Total increase (decrease) in net assets .011
Net assets:
Beginning of the period 9.528
______
End of the period $9.539
======
</TABLE>
Dividend income, Expenses and Investment income - net per unit have been
calculated based on the weighted-average number of units outstanding during
the period (403,754 units). The Net gain (loss) on investments per unit
includes the effects of changes arising from issuance of 604,188 additional
units during the period at net asset values which differed from the net asset
value per unit of the original 15,025 units ($9.528 per unit) on October 15,
1999.
<PAGE>
FT 371
RETAIL PORTFOLIO, SERIES 4
PART ONE
Must be Accompanied by Part Two and Part Three
___________________
P R O S P E C T U S
___________________
SPONSOR: Nike Securities L.P.
1001 Warrenville Road
Lisle, Illinois 60532
(800) 621-1675
TRUSTEE: The Chase Manhattan Bank
4 New York Plaza, 6th Floor
New York, New York 10004-2413
LEGAL COUNSEL Chapman and Cutler
TO SPONSOR: 111 West Monroe Street
Chicago, Illinois 60603
LEGAL COUNSEL Carter, Ledyard & Milburn
TO TRUSTEE: 2 Wall Street
New York, New York 10005
INDEPENDENT Ernst & Young LLP
AUDITORS: Sears Tower
233 South Wacker Drive
Chicago, Illinois 60606
This Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, securities in any jurisdiction to any person to whom it is not
lawful to make such offer in such jurisdiction.
This Prospectus does not contain all the information set forth in the
registration statement and exhibits relating thereto, which the Trust has
filed with the Securities and Exchange Commission, Washington, D.C., under the
Securities Act of 1933 and the Investment Company Act of 1940, and to which
reference is hereby made.
THE FIRST TRUST SPECIAL SITUATIONS TRUST
FT SERIES
PROSPECTUS NOTE: THIS PART TWO PROSPECTUS MAY
Part Two ONLY BE USED WITH PART ONE
Dated May 31, 2000 AND PART THREE
The FT Series (formerly known as The First Trust Special Situations
Trust) is a unit investment trust. The FT Series has many separate
series. The Part One which accompanies this Part Two describes one such
series of the FT Series. Each series of the FT Series consists of one or
more portfolios ("Trust(s)") which invest in one or more of the
following: common stock ("Equity Securities"), preferred stock
("Preferred Stocks"), trust preferred securities ("Trust Preferred
Securities"), real estate investment trusts ("REITs") and/or closed-end
funds ("Closed-End Funds"). See Part One and Part Three for a more
complete description of the portfolio for each Trust.
All Parts of the Prospectus Should be Retained for Future Reference.
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
Page 1
Table of Contents
The FT Series 3
Risk Factors 3
Public Offering 4
Distribution of Units 5
The Sponsor's Profits 6
The Secondary Market 6
How We Purchase Units 6
Expenses and Charges 6
Tax Status 7
Retirement Plans 9
Rights of Unit Holders 9
Income and Capital Distributions 10
Redeeming Your Units 11
Removing Securities from a Trust 12
Amending or Terminating the Indenture 13
Information on the Sponsor, Trustee and Evaluator 13
Other Information 14
Page 2
The FT Series
The FT Series Defined.
We, Nike Securities L.P. (the "Sponsor"), have created hundreds of
similar yet separate series of a unit investment trust which we have
named the FT Series or its predecessor, The First Trust Special
Situations Trust. See Part One for a description of the series and
Trusts for which this Part Two Prospectus relates.
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 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 for each Trust, we deposited a portfolio
or portfolios of one or more of following: Equity Securities, Preferred
Stocks, Trust Preferred Securities, Closed-End Funds and/or REITs,
(collectively, the "Securities") with the Trustee and in turn, the
Trustee delivered documents to us representing our ownership of the
Trusts in the form of units ("Units").
See "The Objective of the Trusts" in Part Three for each Trust for a
specific description of such Trust's objective.
We cannot guarantee that a Trust will keep its present size and
composition for any length of time. Since the prices of the Securities
will fluctuate daily, the ratio of Securities in the Trusts, on a market
value basis, will also change daily. 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 the Trusts. 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.
Risk Factors
Price Volatility. The Trusts may invest in any of the securities set
forth in "The FT Series." The value of a Trust's Units will fluctuate
with changes in the value of these securities. The prices of securities
fluctuate for several reasons including, the type of security, changes
in investor's perceptions of the financial condition of an issuer or the
general condition of the relevant market, or when political or economic
events effecting the issuers occur. In addition, prices may be
particularly sensitive to rising interest rates, as the cost of capital
rises and borrowing costs increase. However, because preferred stock
dividends are fixed (though not guaranteed) and preferred stocks
typically have superior rights to common stocks in dividend
distributions and liquidation, they are generally less volatile than
common stocks.
Because the Trusts are not managed, the Trustee will not sell securities
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.
Certain of the Securities in certain of the Trusts may be issued by
companies with market capitalizations of less than $1 billion. The share
prices of these small-cap companies are often more volatile than those
of larger companies as a result of several factors common to many such
issuers, including limited trading volumes, products or financial
resources, management inexperience and less publicly available
information.
Dividends. There is no guarantee that the issuers of the Equity
Securities will declare dividends in the future or that if declared they
will either remain at current levels or increase over time. In addition,
there is no assurance that the issuers of the Preferred Stocks included
in a Trust will be able to pay dividends at their stated rate in the
future.
Trust Preferred Securities. Certain Trusts may contain trust preferred
securities. Trust preferred securities are limited-life preferred
securities typically issued by corporations, generally in the form of
Page 3
interest-bearing notes or preferred securities, or by an affiliated
business trust of a corporation, generally in the form of beneficial
interests in subordinated debentures or similarly structured securities.
Dividend payments of the trust preferred securities generally coincide
with interest payments on the underlying obligations. Trust preferred
securities generally have a yield advantage over traditional preferred
stocks, but unlike preferred stocks, distributions are treated as
interest rather than dividends for federal income tax purposes and
therefore, are not eligible for the dividends-received deduction. Trust
preferred securities are subject to unique risks which include the fact
that dividend payments will only be paid if interest payments on the
underlying obligations are made, which interest payments are dependent
on the financial condition of the issuer and may be deferred for up to
20 consecutive quarters, and that the underlying obligations, and thus
the trust preferred securities, may be prepaid after a stated call date
or as a result of certain tax or regulatory events.
Closed End Funds. Certain Trusts may contain common stocks issued by
closed-end investment companies. The closed-end investment companies in
turn invest in other securities. Shares of closed-end funds frequently
trade at a discount from their net asset value in the secondary market.
This risk is separate and distinct from the risk that the net asset
value of the closed-end fund shares may decrease. The amount of such
discount from net asset value is subject to change from time to time in
response to various factors.
Real Estate Investment Trusts. Certain Trusts may contain securities
issued by Real Estate Investment Trusts ("REITs"). REITs are financial
vehicles that pool investors' capital to purchase or finance real
estate. REITs may concentrate their investments in specific geographic
areas or in specific property types, i.e., hotels, shopping malls,
residential complexes and office buildings. The value of the REITs and
the ability of the REITs to distribute income may be adversely affected
by several factors, including rising interest rates, changes in the
national, state and local economic climate and real estate conditions,
perceptions of prospective tenants of the safety, convenience and
attractiveness of the properties, the ability of the owner to provide
adequate management, maintenance and insurance, the cost of complying
with the Americans with Disabilities Act, increased competition from new
properties, the impact of present or future environmental legislation
and compliance with environmental laws, changes in real estate taxes and
other operating expenses, adverse changes in governmental rules and
fiscal policies, adverse changes in zoning laws, and other factors
beyond the control of the issuers of the REITs.
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,
or of the industries represented by such issuers may negatively impact
the share prices of these Securities. We cannot predict what impact any
pending or proposed legislation or pending or threatened litigation will
have on the share prices of the Securities.
Foreign Stocks. Certain of the Securities in certain of the Trusts may
be issued by foreign companies, which makes the Trusts subject to more
risks than if they invested solely in domestic common stocks. These
Securities are either directly listed on a U.S. securities exchange or
are in the form of American Depositary Receipts ("ADRs") which are
listed on a U.S. securities exchange. 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; and lack of liquidity of certain
foreign markets.
Public Offering
The Public Offering Price.
You may buy Units at the Public Offering Price, the per Unit price 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 total sales charge.
The price you pay for your Units will differ from the amount stated
under "Summary of Essential Information" in Part One due to various
Page 4
factors, including fluctuations in the prices of the Securities and
changes in the value of the Income and/or Capital Accounts.
Although you are not required to pay for your Units until three business
days 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 sales charge you will pay will consist of a one-time initial sales
charge as listed in Part One for each Trust. See Part Three "Public
Offering" for additional information for each Trust.
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
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 bid 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 bid prices on the over-the-counter
market (unless it is determined that these prices are not appropriate as
a basis for valuation). If current bid prices are unavailable, the
valuation is generally determined:
a) On the basis of current bid prices for comparable securities;
b) By appraising the value of the Securities on the bid side of the
market; or
c) By any combination of the above.
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 will receive concessions on the sale of Units in the amounts set
forth in Part Three of this prospectus. We reserve the right to change
the amount of concessions or agency commissions from time to time.
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.
Investment Comparisons.
From time to time we may compare the estimated returns of the Trusts
(which may show performance net of the expenses and charges the Trusts
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 indexes, 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,
Page 5
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 of a Trust less any reduced sales charge as stated in
Part Three of this prospectus. In maintaining a market for the 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 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, Trustee costs to transfer and record the ownership of
Units and costs incurred in annually updating each Trust's registration
statement. 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 TRUSTEE.
How We Purchase Units
The Trustee will notify us of any tender of Units for redemption. If our
bid at that time 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 that we hold to the Trustee for redemption as any other Units. If
we elect not to purchase Units, the 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 each Trust are set forth under "Summary
of Essential Information" in Part One of this prospectus. If actual
expenses of a Trust exceed the estimate, that Trust will bear the
excess. The Trustee will pay operating expenses of a Trust from the
Income Account of such 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. Legal, typesetting, electronic filing and regulatory
filing fees and expenses associated with updating those Trusts'
registration statements yearly are also now chargeable to such Trusts.
Historically, we paid these fees and expenses. 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
"Summary of Essential Information" in Part One of this prospectus 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. These fees may be adjusted for
inflation without Unit holders' approval, but in no case will the annual
fees 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 services in such year.
For certain Trusts, as set forth in the "Summary of Essential
Information" appearing in Part One for such Trusts, expenses incurred in
establishing such Trusts, including costs of preparing the registration
statement, the trust indenture and other closing documents, registering
Units with the Securities and Exchange Commission and states, the
initial audit of the Trust portfolio and the initial fees and expenses
of the Trustee and any other out-of-pocket expenses, have been paid by
the Trust and are being charged off over a period not to exceed five
years from such Trust's Initial Date of Deposit, or over a period not to
exceed the life of the Trust, if shorter than five years.
Page 6
In addition to a Trust's operating expenses and those fees described
above, each Trust may also incur the following charges:
- License fees payable by a Trust for the use of certain trademarks and
trade names associated with such Trust, if any;
- All legal and annual auditing 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; 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
the Trusts. Since the dividend income is unpredictable, we cannot
guarantee that dividends will be sufficient to meet any or all expenses
of the Trusts. If there is not enough cash in the Income or Capital
Account, the Trustee has the power to sell Securities in a Trust to make
cash available to pay these charges which may result in capital gains or
losses to you. See "Tax Status."
Each Trust will be audited annually. We will bear the cost of these
annual audits to the extent the costs exceed $0.0050 per Unit.
Otherwise, each Trust will pay for the audit. You can request a copy of
the audited financial statements from the Trustee.
Tax Status
Federal Tax Status.
This section summarizes some of the main U.S. federal income tax
consequences of owning Units of a Trust. This section is current as of
the date of this prospectus. Tax laws and interpretations change
frequently, and these summaries do not describe all of the tax
consequences to all taxpayers. For example, these summaries generally do
not describe your situation if you are a non-U.S. person, a
broker/dealer, or other investor with special circumstances. In
addition, this section does not describe state or foreign taxes. As with
any investment, you should consult your own tax professional about your
particular consequences.
Assets of the Trusts.
Each Trust will hold one or more of the following: (i) stock in domestic
and foreign corporations (the "Stocks"), (ii) interests in real estate
investment trusts (the "REIT Shares"), (iii) Trust Preferred Securities
(the "Debt Obligations") and (iv) shares in funds qualifying as
regulated investment companies (the "RIC Shares"). All of the foregoing
assets constitute the "Trust Assets." For purposes of this federal tax
discussion, it is assumed that the Stocks constitute equity, the Debt
Obligations constitute debt and that the RIC Shares and the REIT Shares
constitute qualifying shares in regulated investment companies and real
estate investment trusts, respectively, for federal income tax purposes.
Trust Status.
Except if indicated otherwise in Part Three of this prospectus, each
Trust will not be taxed as a corporation for federal income tax
purposes. As a Unit owner, you will be treated as the owner of a pro
rata portion of each of the Trust Assets, and as such you will be
considered to have received a pro rata share of income (i.e., interest,
dividends, accruals of original issue discount and market discount, and
capital gains, if any) from each Trust Asset when such income is
considered to be received by the Trust. This is true even if you elect
to have your distributions automatically reinvested into additional
Units.
Your Tax Basis and Income or Loss upon Disposition.
If your Trust disposes of Trust Assets, you will generally recognize
gain or loss. If you dispose of your Units or redeem your Units for
cash, you will also generally recognize gain or loss. To determine the
amount of this gain or loss, you must subtract your tax basis in the
related Trust Assets from your share of the total proceeds received in
the transaction. You can generally determine your initial tax basis in
each Trust Asset by apportioning the cost of your Units, generally
including sales charges, among each Trust Asset ratably according to its
value on the date you acquire your Units. In certain circumstances,
however, you may have to adjust your tax basis after you acquire your
Page 7
Units (for example, in the case of certain dividends that exceed a
corporation's accumulated earnings and profits or in the case of
original issue discount, market discount, premium and accrued interest
with regard to the Debt Obligations, as discussed below).
If you are an individual, the maximum marginal federal tax rate for net
capital gain is generally 20% (10% for certain taxpayers in the lowest
tax bracket). Net capital gain equals net long-term capital gain minus
net short-term capital loss for the taxable year. Capital gain or loss
is long-term if the holding period for the asset is more than one year
and is short-term if the holding period for the asset is one year or
less. You must exclude the date you purchase your Units or the date your
Trust purchases a Trust Asset to determine the holding period. The tax
rates for capital gains realized from assets held for one year or less
are generally the same as for ordinary income. The Code may, however,
treat certain capital gains as ordinary income in special situations
(for example, in the case of gain on the Debt Obligations attributable
to market discount). In addition, capital gain received from assets held
for more than one year that is considered "unrecaptured section 1250
gain" (which may be the case, for example, with some capital gains
attributable to the REIT Shares) is taxed at a maximum stated tax rate
of 25%.
Dividends from RIC Shares and REIT Shares.
Some dividends on the REIT Shares or the RIC Shares may qualify as
"capital gain dividends," taxable to you as long-term capital gains. If
you hold a Unit for six months or less or if your Trust holds a RIC
Share or REIT Share for six months or less, any loss incurred by you
related to the disposition of such RIC Share or REIT Share will be
treated as a long-term capital loss to the extent of any long-term
capital gain distributions received (or deemed to have been received)
with respect to such RIC Share or REIT Share. Distributions of income or
capital gains declared on the REIT Shares or the RIC Shares in October,
November or December will be deemed to have been paid to you on December
31 of the year they are declared, even when paid by the REIT or the RIC
during the following January.
Discount, Accrued Interest and Premium on Debt Obligations.
Some Debt Obligations may have been sold with original issue discount.
This generally means that the Debt Obligations were originally issued at
a price below their face (or par) value. Original issue discount accrues
on a daily basis and generally is treated as interest income for federal
income tax purposes. The basis of your Unit and of each Debt Obligation
which was issued with original issue discount must be increased as
original issue discount accrues.
Some Debt Obligations may have been purchased by you or your Trust at a
market discount. Market discount is generally the excess of the stated
redemption price at maturity for the Debt Obligation over the purchase
price of the Debt Obligation (not including unaccrued original issue
discount). Market discount can arise based on the price your Trust pays
for a Debt Obligation or on the price you pay for your Units. Market
discount is taxed as ordinary income. You will recognize this income
when your Trust receives principal payments on the Debt Obligation, when
the Debt Obligation is sold or redeemed, or when you sell or redeem your
Units. Alternatively, you may elect to include market discount in
taxable income as it accrues. Whether or not you make this election will
affect how you calculate your basis and the timing of certain interest
expense deductions.
Alternatively, some Debt Obligations may have been purchased by you or
your Trust at a premium. Generally, if the tax basis of your pro rata
portion of any Debt Obligation exceeds the amount payable at maturity,
such excess is considered premium. You may elect to amortize premium. If
you make this election, you may reduce your interest income received on
the Debt Obligation by the amount of the premium that is amortized and
your tax basis will be reduced.
If the price of your Units included accrued interest on a Debt
Obligation, you must include the accrued interest in your tax basis in
that Debt Obligation. When your Trust receives this accrued interest,
you must treat it as a return of capital and reduce your tax basis in
the Debt Obligation.
This discussion provides only the general rules with respect to the tax
treatment of original issue discount, market discount and premium. The
rules, however, are complex and special rules apply in certain
circumstances. For example, the accrual of market discount or premium
Page 8
may differ from the discussion set forth above in the case of Debt
Obligations that were issued with original issue discount.
Dividends Received Deduction.
A corporation that owns Units will generally not be entitled to the
dividends received deduction with respect to many dividends received by
your Trust, because the dividends received deduction is not available
for dividends from most foreign corporations or from REITs.
Distributions on a RIC Share are eligible for the dividends received
deduction only to the extent that the dividends received by the Unit
owner are attributable to dividends received by the RIC itself from
certain domestic corporations and are designated by the RIC as being
eligible for the dividends received deduction. Finally, because the Debt
Obligations are treated as debt (not equity) for federal income tax
purposes, distributions from the Debt Obligations are not eligible for
the dividends received deduction.
In-Kind Distributions.
Under certain circumstances, you may request an In-Kind Distribution of
Trust Assets when you redeem your Units or at your Trust's termination.
By electing to receive an In-Kind Distribution, you will receive an
undivided interest in Trust Assets plus, possibly, cash. You will not
recognize gain or loss if you only receive Trust Assets in exchange for
your pro rata portion of the Trust Assets held by your Trust. However,
if you also receive cash in exchange for a fractional portion of a Trust
Asset, you will generally recognize gain or loss based on the difference
between the amount of cash you receive and your tax basis in such
fractional portion of the Trust Asset.
Limitations on the Deductibility of Trust Expenses.
Generally, for federal income tax purposes, you must take into account
your full pro rata share of your Trust's income, even if some of that
income is used to pay Trust expenses. You may deduct your pro rata share
of each expense paid by your Trust to the same extent as if you directly
paid the expense. You may be required to treat some or all of the
expenses of your Trust as miscellaneous itemized deductions. However,
individuals may only deduct certain miscellaneous itemized deductions to
the extent they exceed 2% of adjusted gross income.
Foreign, State and Local Taxes.
Interest and dividend payments on your Trust Assets of foreign companies
that are paid to your Trust may be subject to foreign withholding taxes.
Any income withheld will still be treated as income to you. Under the
grantor trust rules, you are considered to have paid directly your share
of foreign taxes. Therefore, for U.S. tax purposes, you may be entitled
to a foreign tax credit or deduction for those foreign taxes.
If you are a foreign investor (i.e., an investor other than a U.S.
citizen or resident or a U.S. corporation, partnership, estate or
trust), you will not be subject to U.S. federal income taxes, including
withholding taxes, on some of the income from your Trust or on any gain
from the sale or redemption of your Units, provided that certain
conditions are met. You should consult your tax advisor with respect to
the conditions you must meet in order to be exempt for U.S. tax purposes.
Under the existing income tax laws of the State and City of New York,
your Trust will not be taxed as a corporation, and the income of your
Trust will be treated as the income of the Unit holders in the same
manner as for federal income tax purposes. You should consult your tax
advisor regarding potential foreign, state or local taxation with
respect to your Units.
Retirement Plans
You may purchase Units of the Trusts for:
- Individual Retirement Accounts;
- Keogh Plans;
- Pension funds; and
- Other tax-deferred retirement plans.
Generally, the federal income tax on capital gains and income received
in each of the above plans is deferred until you receive distributions.
These distributions are generally treated as ordinary income but may, in
some cases, be eligible for special averaging or tax-deferred rollover
treatment. Before participating in a plan like this, you should review
the tax laws regarding these plans and consult your attorney or tax
advisor. Brokerage firms and other financial institutions offer these
plans with varying fees and charges.
Rights of Unit Holders
Unit Ownership.
The Trustee will treat as Record Owner of Units persons registered as
such on its books. It is your responsibility to notify the Trustee when
Page 9
you become Record Owner, but normally your broker/dealer provides this
notice. You may elect to hold your Units in either certificated or
uncertificated form.
Certificated Units. When you purchase your Units you can request that
they be evidenced by certificates, which will be delivered shortly after
your order. Certificates will be issued in fully registered form,
transferable only on the books of the Trustee in denominations of one
Unit or any multiple thereof. You can transfer or redeem your
certificated Units by endorsing and surrendering the certificate to the
Trustee, along with a written instrument of transfer. You must sign your
name exactly as it appears on the face of the certificate with your
signature guaranteed by an eligible institution. In certain cases the
Trustee may require additional documentation before they will transfer
or redeem your Units.
You may be required to pay a nominal fee to the Trustee for each
certificate reissued or transferred, and to pay any government charge
that may be imposed for each transfer or exchange. If a certificate gets
lost, stolen or destroyed, you may be required to furnish indemnity to
the Trustee to receive replacement certificates. You must surrender
mutilated certificates to the Trustee for replacement.
Uncertificated Units. You may also choose to hold your Units in
uncertificated form. If you choose this option, the Trustee 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 Trustee will send you:
- A written initial transaction statement containing a description of
the Trust;
- A list of 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.
Uncertificated Units may be transferred the same way as certificated
Units, except that no certificate needs to be presented to the Trustee.
Also, no certificate will be issued when the transfer takes place unless
you request it. You may at any time request that the Trustee issue
certificates for your Units.
Unit Holder Reports.
In connection with each distribution, the Trustee will provide you with
a statement detailing the per Unit amount of income (if any)
distributed. After the end of each calendar year, the Trustee will
provide you with the following information:
- 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 Trustee copies of the evaluations of the
Securities as prepared by the Evaluator to enable you to comply with
federal and state tax reporting requirements.
Income and Capital Distributions
You will begin receiving 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 on or
near the Income Distribution Dates to Unit holders of record on the
preceding Income Distribution Record Date. See "Summary of Essential
Information" in Part One of this prospectus. No income distribution will
be paid if accrued expenses of a Trust exceed amounts in the Income
Account on the Income Distribution Dates. Distribution amounts will vary
with changes in a Trust's fees and expenses, in dividends received and
with the sale of Securities. The Trustee will distribute amounts in the
Capital Account, net of amounts designated to meet redemptions or pay
expenses on the last day of each month to Unit holders of record on the
fifteenth day of each month provided the amount equals at least $1.00
per 100 Units ($1.00 per 1,000 Units if the Initial Public Offering
Price was approximately $1.00 per Unit). If the Trustee does not have
your TIN, it is required to withhold a certain percentage of your
distribution and deliver such amount to the Internal Revenue Service
Page 10
("IRS"). You may recover this amount by giving your TIN to the Trustee,
or when you file a tax return. However, you should check your statements
to make sure the Trustee has your TIN to avoid this "back-up withholding."
Within a reasonable time after a Trust is terminated, you will receive
the pro rata share of the money from the sale of the Securities.
However, if you are eligible, you may elect to receive an In-Kind
Distribution as described under "Amending or Terminating the Indenture."
You will receive a pro rata share of any other assets remaining in your
Trust after deducting any unpaid expenses.
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 such Trust.
Distribution Reinvestment Option. If applicable, you may elect to have
each distribution of income and/or capital reinvested into additional
Units of your Trust by notifying the Trustee at least 10 days before any
Record Date. Each later distribution of income and/or capital on your
Units will be reinvested by the Trustee into additional Units of your
Trust. There is no sales charge on Units acquired through the
Distribution Reinvestment Option. This option may not be available in
all states.PLEASE NOTE THAT EVEN IF YOU REINVEST DISTRIBUTIONS, THEY ARE
STILL CONSIDERED DISTRIBUTIONS FOR INCOME TAX PURPOSES.See Part Three of
this prospectus to determine whether the distribution reinvestment
option is available for a particular Trust.
Redeeming Your Units
You may redeem all or a portion of your Units at any time by sending the
certificates representing the Units you want to redeem to the Trustee at
its unit investment trust office. If your Units are uncertificated, you
need only deliver a request for redemption to the Trustee. In either
case, the certificates or the redemption request must be properly
endorsed with proper instruments of transfer and signature guarantees as
explained in "Rights of Unit Holders-Unit Ownership" (or by providing
satisfactory indemnity if the certificates were lost, stolen, or
destroyed). No redemption fee will be charged, but you are responsible
for any governmental charges that apply. Three business days 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 Trustee
receives your certificates or redemption request (if such day is a day
the NYSE is open for trading). However, if your certificates or
redemption request are 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 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. The IRS will require the Trustee to withhold a
portion of your redemption proceeds if it does not have your TIN, as
generally discussed under "Income and Capital Distributions."
For certain Trusts, if you tender at least the minimum number of Units
specified in "Summary of Essential Information" in Part One of this
prospectus, rather than receiving cash, you may elect to receive an In-
Kind Distribution in an amount equal to the Redemption Price per Unit by
making this request in writing to the Trustee at the time of tender.
However, no In-Kind Distribution requests submitted during the nine
business days prior to a Trust's Mandatory Termination Date will be
honored. Where possible, the Trustee will make an In-Kind Distribution
by distributing each of the Securities in book-entry form to your bank
or broker/dealer account at the Depository Trust Company. The Trustee
will subtract any customary transfer and registration charges from your
In-Kind Distribution. As a tendering Unit holder, you will receive your
pro rata number of whole shares of the Securities that make up the
portfolio, and cash from the Capital Account equal to the fractional
shares to which you are entitled.
The Trustee may sell Securities 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
Page 11
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
purchase Securities;
2. the aggregate value of the Securities held in a 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 a Trust;
2. any amounts owed to the Trustee for its advances;
3. estimated accrued expenses of a Trust, if any;
4. cash held for distribution to Unit holders of record of a 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 a Trust; and
dividing
1. the result by the number of outstanding Units of a Trust.
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
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;
- There has been a public tender offer made for a Security or a merger
or acquisition is announced affecting a Security, and that in our
opinion the sale or tender of the Security is in the best interest of
Unit holders; 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.
A Trust may not acquire any securities or other property other than the
Securities. The Trustee, on behalf of the Trusts, 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 each Portfolio Supervisor.
Any proceeds received from the sale of Securities, exchanged securities
or property will be credited to the Capital Account 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 a Trust 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 a Trust's portfolio transactions,
or when acting as agent for a Trust in acquiring or selling Securities
on behalf of the Trusts.
Page 12
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, the Trusts will terminate on
the Mandatory Termination Date as stated in the "Summary of Essential
Information" in Part One for each Trust. The Trusts may be terminated
earlier:
- Upon the consent of 100% of the Unit holders of a Trust;
- If the value of the Securities owned by a 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 certificates, if
any, to the Trustee. For various reasons, 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
otherwise be realized if such sale were not required at this time.
If you qualify for an In-Kind Distribution, the Trustee will send you a
form at least 30 days prior to the Mandatory Termination Date which will
enable you to receive an In-Kind Distribution (reduced by customary
transfer and registration charges) rather than the typical cash
distribution. See "Tax Status" for additional information. You must
notify the Trustee at least ten business days prior to the Mandatory
Termination Date if you elect this In-Kind Distribution option. If you
do not elect to participate in the In-Kind Distribution 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 such Trust is terminated. Regardless of the
distribution involved, the Trustee will deduct from the Trusts 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 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 $27 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, 1999, the total partners' capital of
Nike Securities L.P. was $19,881,035 (audited).
Page 13
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.
Code of Ethics. The Sponsor and the Trusts have adopted a code of ethics
requiring the Sponsor's employees who have access to information on
Trust transactions to report personal securities transactions. The
purpose of the code is to avoid potential conflicts of interest and to
prevent fraud, deception or misconduct with respect to the Trusts.
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 for the
Trusts; it only provides administrative services.
Limitations of Liabilities of Sponsor and Trustee.
Neither we 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 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.
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 Trusts; 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 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 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,
appearing in each Part One of this prospectus, 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.
Page 14
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Page 15
FIRST TRUST (registered trademark)
THE FIRST TRUST SPECIAL SITUATIONS TRUST
FT SERIES
Prospectus
Part Two
Sponsor:
NIKE SECURITIES L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
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 (set forth in Part One for each Trust) and
- Investment Company Act of 1940 (file no. 811-05903)
Information about the Trusts, including their Codes of Ethics, 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]
May 31, 2000
PLEASE RETAIN ALL PARTS OF THIS PROSPECTUS FOR FUTURE REFERENCE
Page 16
America's Leading Brands Growth Trust Series
America's Leading Brands Growth Portfolio Series
America's Leading Brands Portfolio Series
The First Trust (R) Special Situations Trust
FT Series
PROSPECTUS NOTE: THIS PART THREE PROSPECTUS
Part Three MAY ONLY BE USED WITH
Dated November 30, 2000 PART ONE AND PART TWO
Each Trust contains a diversified portfolio of common stocks
("Securities") issued by companies in the industry sector or investment
focus for which each Trust is named. The objective of each Trust is to
provide above-average capital appreciation.
All Parts of the Prospectus Should be Retained for Future Reference.
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 (R)
1-800-621-9533
Page 1
Portfolio
Objectives.
The objective of each Trust is to provide the potential for above
average capital appreciation through an investment in common stocks of
companies considered to be leaders in their industries.
Of course, as with any similar investments, there can be no guarantee
that the objective of the Trusts will be achieved. See "Risk Factors"
herein and in Part Two of this prospectus for a discussion of the risks
of investing in the Trusts.
Risk Factors
Consumer Products Industry. Because more than 25% of each Trust is
invested in consumer products companies, each Trust is considered to be
concentrated in the consumer products industry. A portfolio concentrated
in a single industry may present more risks than a portfolio which is
broadly diversified over several industries. General risks of these
companies include cyclicality of revenues and earnings, changing
consumer tastes, extensive competition, product liability litigation and
increased governmental regulation. Generally, spending on consumer
products is affected by the economic health of consumers. A weak economy
and its effect on consumer spending would adversely affect consumer
products companies.
Public Offering
Discounts for Certain Persons.
If you invest at least $50,000 (except if you are purchasing for a "wrap
fee account" as described below), the maximum sales charge is reduced,
as follows:
Your maximum
If you invest sales charge
(in thousands):* will be:
_________________ ____________
$50 but less than $100 4.25%
$100 but less than $250 4.00%
$250 but less than $500 3.50%
$500 or more 2.50%
* The breakpoint sales charges are also applied on a Unit basis
utilizing a breakpoint equivalent in the above table of $10 per Unit and
will be applied on whichever basis is more favorable to the investor.
The breakpoints will be adjusted to take into consideration purchase
orders stated in dollars which cannot be completely fulfilled due to the
requirement that only whole Units be issued.
The reduced sales charge for quantity purchases will apply only to
purchases made by the same person on any one day from any one dealer. To
help you reach the above levels, you may combine same-day purchases of
Units of the Trusts and units of other similarly structured equity unit
trusts for which we act as Principal Underwriter and which are currently
in the initial offering period. In addition, we will consider Units you
purchase in the name of your spouse or your child under 21 years of age
to be purchases by you for determining the reduced sales charge. The
reduced sales charges will also apply to a trustee or other fiduciary
purchasing Units for a single trust estate or single fiduciary account.
You must inform your dealer of any combined purchases before the sale in
order to be eligible for the reduced sales charge. Any reduced sales is
the responsibility of the party making the sale.
The following persons may purchase Units at the Public Offering Price
less the applicable dealer concession:
- Employees, officers and directors of the Sponsor, our related
companies, dealers and their affiliates, and vendors providing services
to us.
- Immediate family members of the above (spouses, children,
grandchildren, parents, grandparents, siblings, mothers-in-law, fathers-
in-law, sons-in-law, daughters-in-law, brothers-in-law and sisters-in-
law, and trustees, custodians or fiduciaries for the benefit of such
persons).
If you purchase Units through registered broker/dealers who charge
periodic fees for financial planning, investment advisory or asset
management services or provide these services as part of an investment
Page 2
account where a comprehensive "wrap fee" charge is imposed, your Units
will only be assessed that portion of the sales charge retained by the
Sponsor.
Distribution of Units
We intend to qualify Units of the Trusts for sale in a number of states.
Units will be sold at the current Public Offering Price.
Dealer Concessions.
Dealers and other selling agents can purchase Units at prices which
represent a concession or agency commission of 65% of the then current
maximum sales charge.
Income and Capital Distributions
Distribution Reinvestment Option. You may elect to have each
distribution of income and/or capital reinvested into additional Units
of your Trust by notifying the Trustee at least 10 days before any
Record Date. Each later distribution of income and/or capital on your
Units will be reinvested by the Trustee into additional Units of your
Trust. This option may not be available in all states. PLEASE NOTE THAT
EVEN IF YOU REINVEST DISTRIBUTIONS, THEY ARE STILL CONSIDERED
DISTRIBUTIONS FOR INCOME TAX PURPOSES.
Other Information
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 3
FIRST TRUST(R)
America's Leading Brands Growth Trust Series
America's Leading Brands Growth Portfolio Series
America's Leading Brands Portfolio Series
The First Trust (R) Special Situations Trust
FT Series
PART THREE PROSPECTUS
Must be Accompanied by Parts One and Two
Sponsor:
Nike Securities L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS NOT LAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO, WHICH THE TRUST
HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940,
AND TO WHICH REFERENCE IS HEREBY MADE.
PLEASE RETAIN ALL PARTS OF THIS PROSPECTUS FOR FUTURE REFERENCE
Page 4
First Trust (R)
America's Leading Brands Growth Trust Series
America's Leading Brands Growth Portfolio Series
America's Leading Brands Portfolio Series
The First Trust (R) Special Situations Trust
The FT Series
Information Supplement
This Information Supplement provides additional information concerning
the structure, operations and risks of unit investment trusts ("Trusts")
contained in the Trusts not found in the prospectus. This Information
Supplement is not a prospectus and does not include all of the
information that a prospective investor should consider before investing
in a Trust. This Information Supplement should be read in conjunction
with the prospectus for the Trust in which an investor is considering
investing ("prospectus").
This Information Supplement is dated November 30, 2000. Capitalized
terms have been defined in the prospectus.
Table of Contents
Risk Factors
Securities 1
Dividends 1
Concentration
Consumer Products 1
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.
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. 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.
Concentration
Consumer Products. An investment in Units of the Trusts should be made
with an understanding of the problems and risks inherent in an
investment in the consumer products industry in general. These include
the cyclicality of revenues and earnings, changing consumer demands,
regulatory restrictions, product liability litigation and other
litigation resulting from accidents, extensive competition (including
that of low-cost foreign competition), unfunded pension fund liabilities
and employee and retiree benefit costs and financial deterioration
resulting from leveraged buy-outs, takeovers or acquisitions. In
general, expenditures on consumer products will be affected by the
economic health of consumers. A weak economy with its consequent effect
on consumer spending would have an adverse effect on consumer products
Page 1
companies. Other factors of particular relevance to the profitability of
the industry are the effects of increasing environmental regulation on
packaging and on waste disposal, the continuing need to conform with
foreign regulations governing packaging and the environment, the outcome
of trade negotiations and the effect on foreign subsidies and tariffs,
foreign exchange rates, the price of oil and its effect on energy costs,
inventory cutbacks by retailers, transportation and distribution costs,
health concerns relating to the consumption of certain products, the
effect of demographics on consumer demand, the availability and cost of
raw materials and the ongoing need to develop new products and to
improve productivity.
Page 2
Biotechnology Growth Trust Series
Biotechnology Portfolio Series
The First Trust (R) Special Situations Trust
FT Series
PROSPECTUS NOTE: THIS PART THREE PROSPECTUS
Part Three MAY ONLY BE USED WITH
Dated November 30, 2000 PART ONE AND PART TWO
Each Trust contains a diversified portfolio of common stocks
("Securities") issued by companies in the industry sector or investment
focus for which each Trust is named. The objective of each Trust is to
provide above-average capital appreciation.
All Parts of the Prospectus Should be Retained for Future Reference.
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 (R)
1-800-621-9533
Page 1
Portfolio
Objectives.
The objective of each Trust is to provide the potential for above
average capital appreciation through an investment in common stocks of
biotechnology companies and pharmaceutical companies actively
participating in the biotechnology industry.
Of course, as with any similar investments, there can be no guarantee
that the objective of the Trusts will be achieved. See "Risk Factors"
herein and in Part Two of this prospectus for a discussion of the risks
of investing in the Trusts.
Risk Factors
Biotechnology/Pharmaceutical Industries. Because more than 25% of each
Trust is invested in companies involved in drug development and
production, each Trust is considered to be concentrated in the
biotechnology and pharmaceutical industries. A portfolio concentrated in
a single industry may present more risks than a portfolio which is
broadly diversified over several industries. Biotech and pharmaceutical
companies are subject to changing government regulation, including price
controls, national health insurance, managed care regulation and tax
incentives or penalties related to medical insurance premiums, which
could have a negative effect on the price and availability of their
products and services. In addition, such companies face increasing
competition from generic drug sales, the termination of their patent
protection for certain drugs and technological advances which render
their products or services obsolete. The research and development costs
required to bring a drug to market are substantial and may include a
lengthy review by the government, with no guarantee that the product
will ever go to market or show a profit. Many of these companies may not
offer certain drugs or products for several years, and as a result, may
have significant losses of revenue and earnings.
Public Offering
Discounts for Certain Persons.
If you invest at least $50,000 (except if you are purchasing for a "wrap
fee account" as described below), the maximum sales charge is reduced,
as follows:
Your maximum
If you invest sales charge
(in thousands):* will be:
_________________ ____________
$50 but less than $100 4.25%
$100 but less than $250 4.00%
$250 but less than $500 3.50%
$500 or more 2.50%
* The breakpoint sales charges are also applied on a Unit basis
utilizing a breakpoint equivalent in the above table of $10 per Unit and
will be applied on whichever basis is more favorable to the investor.
The breakpoints will be adjusted to take into consideration purchase
orders stated in dollars which cannot be completely fulfilled due to the
requirement that only whole Units be issued.
The reduced sales charge for quantity purchases will apply only to
purchases made by the same person on any one day from any one dealer. To
help you reach the above levels, you may combine same-day purchases of
Units of the Trusts and units of other similarly structured equity unit
trusts for which we act as Principal Underwriter and which are currently
in the initial offering period. In addition, we will consider Units you
purchase in the name of your spouse or your child under 21 years of age
to be purchases by you for determining the reduced sales charge. The
reduced sales charges will also apply to a trustee or other fiduciary
purchasing Units for a single trust estate or single fiduciary account.
You must inform your dealer of any combined purchases before the sale in
order to be eligible for the reduced sales charge. Any reduced sales is
the responsibility of the party making the sale.
The following persons may purchase Units at the Public Offering Price
less the applicable dealer concession:
- Employees, officers and directors of the Sponsor, our related
companies, dealers and their affiliates, and vendors providing services
to us.
- Immediate family members of the above (spouses, children,
grandchildren, parents, grandparents, siblings, mothers-in-law, fathers-
Page 2
in-law, sons-in-law, daughters-in-law, brothers-in-law and sisters-in-
law, and trustees, custodians or fiduciaries for the benefit of such
persons).
If you purchase Units through registered broker/dealers who charge
periodic fees for financial planning, investment advisory or asset
management services or provide these services as part of an investment
account where a comprehensive "wrap fee" charge is imposed, your Units
will only be assessed that portion of the sales charge retained by the
Sponsor.
Distribution of Units
We intend to qualify Units of the Trusts for sale in a number of states.
Units will be sold at the current Public Offering Price.
Dealer Concessions.
Dealers and other selling agents can purchase Units at prices which
represent a concession or agency commission of 65% of the then current
maximum sales charge.
Income and Capital Distributions
Distribution Reinvestment Option. You may elect to have each
distribution of income and/or capital reinvested into additional Units
of your Trust by notifying the Trustee at least 10 days before any
Record Date. Each later distribution of income and/or capital on your
Units will be reinvested by the Trustee into additional Units of your
Trust. This option may not be available in all states. PLEASE NOTE THAT
EVEN IF YOU REINVEST DISTRIBUTIONS, THEY ARE STILL CONSIDERED
DISTRIBUTIONS FOR INCOME TAX PURPOSES.
Other Information
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 3
FIRST TRUST(R)
Biotechnology Growth Trust Series
Biotechnology Portfolio Series
The First Trust (R) Special Situations Trust
FT Series
PART THREE PROSPECTUS
Must be Accompanied by Parts One and Two
Sponsor:
Nike Securities L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS NOT LAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO, WHICH THE TRUST
HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940,
AND TO WHICH REFERENCE IS HEREBY MADE.
PLEASE RETAIN ALL PARTS OF THIS PROSPECTUS FOR FUTURE REFERENCE
Page 4
First Trust (R)
Biotechnology Growth Trust Series
Biotechnology Portfolio Series
The First Trust (R) Special Situations Trust
The FT Series
Information Supplement
This Information Supplement provides additional information concerning
the structure, operations and risks of unit investment trusts ("Trusts")
contained in the Trusts not found in the prospectus. This Information
Supplement is not a prospectus and does not include all of the
information that a prospective investor should consider before investing
in a Trust. This Information Supplement should be read in conjunction
with the prospectus for the Trust in which an investor is considering
investing ("prospectus").
This Information Supplement is dated November 30, 2000. Capitalized
terms have been defined in the prospectus.
Table of Contents
Risk Factors
Securities 1
Dividends 1
Concentration
Biotechnology/Pharmaceutical 1
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.
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. 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.
Concentration
Biotechnology/Pharmaceutical. An investment in Units of the Trusts
should be made with an understanding of the problems and risks such an
investment may entail.
Companies involved in advanced medical devices and instruments, drugs
and biotech have potential risks unique to their sector of the
healthcare field. These companies are subject to governmental regulation
of their products and services, a factor which could have a significant
and possibly unfavorable effect on the price and availability of such
products or services. Furthermore, such companies face the risk of
increasing competition from new products or services, generic drug
sales, the termination of patent protection for drug or medical supply
products and the risk that technological advances will render their
products obsolete. The research and development costs of bringing a drug
to market are substantial, and include lengthy governmental review
Page 1
processes with no guarantee that the product will ever come to market.
Many of these companies may have losses and may not offer certain
products for several years. Such companies may also have persistent
losses during a new product's transition from development to production,
and revenue patterns may be erratic.
As the population of the United States ages, the companies involved in
the healthcare field will continue to search for and develop new drugs,
medical products and medical services through advanced technologies and
diagnostics. On a worldwide basis, such companies are involved in the
development and distributions of drugs, vaccines, medical products and
medical services. These activities may make the
biotechnology/pharmaceuticals sector very attractive for investors
seeking the potential for growth in their investment portfolio. However,
there are no assurances that the Trust's objectives will be met.
Legislative proposals concerning healthcare are proposed in Congress
from time to time. These proposals span a wide range of topics,
including cost and price controls (which might include a freeze on the
prices of prescription drugs). The Sponsor is unable to predict the
effect of any of these proposals, if enacted, on the issuers of
Securities in a Trust.
Page 2
Communications Growth Trust Series
Communications Growth Portfolio Series
Communications Portfolio Series
The First Trust (R) Special Situations Trust
FT Series
PROSPECTUS NOTE: THIS PART THREE PROSPECTUS
Part Three MAY ONLY BE USED WITH
Dated November 30, 2000 PART ONE AND PART TWO
Each Trust contains a diversified portfolio of common stocks
("Securities") issued by companies in the industry sector or investment
focus for which each Trust is named. The objective of each Trust is to
provide above-average capital appreciation.
All Parts of the Prospectus Should be Retained for Future Reference.
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 (R)
1-800-621-9533
Page 1
Portfolio
Objectives.
The objective of each Trust is to provide the potential for above
average capital appreciation through an investment in common stocks of
communications companies, diversified across domestic and international
companies involved in communications services, data
networking/communications equipment and wireless communications.
Of course, as with any similar investments, there can be no guarantee
that the objective of the Trusts will be achieved. See "Risk Factors"
herein and in Part Two of this prospectus for a discussion of the risks
of investing in the Trusts.
Risk Factors
Communications Industry. Because more than 25% of each Trust is invested
in communications companies, each Trust is considered to be concentrated
in the communications industry. A portfolio concentrated in a single
industry may present more risks than a portfolio which is broadly
diversified over several industries. Communications companies are
generally subject to the risks of rapidly changing technologies; short
product life cycles; fierce competition; aggressive pricing and reduced
profit margins; the loss of patent, copyright and trademark protections;
cyclical market patterns; evolving industry standards and frequent new
product introductions. Rapid deregulation, both in the United States and
internationally, allows companies to develop products and services for a
larger market, but also exposes them to fierce global competition.
Public Offering
Discounts for Certain Persons.
If you invest at least $50,000 (except if you are purchasing for a "wrap
fee account" as described below), the maximum sales charge is reduced,
as follows:
Your maximum
If you invest sales charge
(in thousands):* will be:
_________________ ____________
$50 but less than $100 4.25%
$100 but less than $250 4.00%
$250 but less than $500 3.50%
$500 or more 2.50%
* The breakpoint sales charges are also applied on a Unit basis
utilizing a breakpoint equivalent in the above table of $10 per Unit and
will be applied on whichever basis is more favorable to the investor.
The breakpoints will be adjusted to take into consideration purchase
orders stated in dollars which cannot be completely fulfilled due to the
requirement that only whole Units be issued.
The reduced sales charge for quantity purchases will apply only to
purchases made by the same person on any one day from any one dealer. To
help you reach the above levels, you may combine same-day purchases of
Units of the Trusts and units of other similarly structured equity unit
trusts for which we act as Principal Underwriter and which are currently
in the initial offering period. In addition, we will consider Units you
purchase in the name of your spouse or your child under 21 years of age
to be purchases by you for determining the reduced sales charge. The
reduced sales charges will also apply to a trustee or other fiduciary
purchasing Units for a single trust estate or single fiduciary account.
You must inform your dealer of any combined purchases before the sale in
order to be eligible for the reduced sales charge. Any reduced sales is
the responsibility of the party making the sale.
The following persons may purchase Units at the Public Offering Price
less the applicable dealer concession:
- Employees, officers and directors of the Sponsor, our related
companies, dealers and their affiliates, and vendors providing services
to us.
- Immediate family members of the above (spouses, children,
grandchildren, parents, grandparents, siblings, mothers-in-law, fathers-
in-law, sons-in-law, daughters-in-law, brothers-in-law and sisters-in-
law, and trustees, custodians or fiduciaries for the benefit of such
persons).
If you purchase Units through registered broker/dealers who charge
periodic fees for financial planning, investment advisory or asset
management services or provide these services as part of an investment
Page 2
account where a comprehensive "wrap fee" charge is imposed, your Units
will only be assessed that portion of the sales charge retained by the
Sponsor.
Distribution of Units
We intend to qualify Units of the Trusts for sale in a number of states.
Units will be sold at the current Public Offering Price.
Dealer Concessions.
Dealers and other selling agents can purchase Units at prices which
represent a concession or agency commission of 65% of the then current
maximum sales charge.
Income and Capital Distributions
Distribution Reinvestment Option. You may elect to have each
distribution of income and/or capital reinvested into additional Units
of your Trust by notifying the Trustee at least 10 days before any
Record Date. Each later distribution of income and/or capital on your
Units will be reinvested by the Trustee into additional Units of your
Trust. This option may not be available in all states. PLEASE NOTE THAT
EVEN IF YOU REINVEST DISTRIBUTIONS, THEY ARE STILL CONSIDERED
DISTRIBUTIONS FOR INCOME TAX PURPOSES.
Other Information
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 3
FIRST TRUST(R)
Communications Growth Trust Series
Communications Growth Portfolio Series
Communications Portfolio Series
The First Trust (R) Special Situations Trust
FT Series
PART THREE PROSPECTUS
Must be Accompanied by Parts One and Two
Sponsor:
Nike Securities L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS NOT LAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO, WHICH THE TRUST
HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940,
AND TO WHICH REFERENCE IS HEREBY MADE.
PLEASE RETAIN ALL PARTS OF THIS PROSPECTUS FOR FUTURE REFERENCE
Page 4
First Trust (R)
Communications Growth Trust Series
Communications Growth Portfolio Series
Communications Portfolio Series
The First Trust (R) Special Situations Trust
The FT Series
Information Supplement
This Information Supplement provides additional information concerning
the structure, operations and risks of unit investment trusts ("Trusts")
contained in the Trusts not found in the prospectus. This Information
Supplement is not a prospectus and does not include all of the
information that a prospective investor should consider before investing
in a Trust. This Information Supplement should be read in conjunction
with the prospectus for the Trust in which an investor is considering
investing ("prospectus").
This Information Supplement is dated November 30, 2000. Capitalized
terms have been defined in the prospectus.
Table of Contents
Risk Factors
Securities 1
Dividends 1
Concentration
Communications 1
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.
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. 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.
Concentration
Communications. An investment in Units of the Trusts should be made with
an understanding of the problems and risks such an investment may
entail. The market for high-technology communications products and
services 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 and services. 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
Page 1
able to respond in a timely manner to compete in the rapidly developing
marketplace.
The communications industry is subject to governmental regulation.
However, as market forces develop, the government will continue to
deregulate the communications industry, promoting vigorous economic
competition and resulting in the rapid development of new communications
technologies. The products and services of communications companies may
be subject to rapid obsolescence. These factors could affect the value
of the Trust's Units. For example, while telephone companies in the
United States are subject to both state and federal regulations
affecting permitted rates of returns and the kinds of services that may
be offered, the prohibition against phone companies delivering video
services has been lifted. This creates competition between phone
companies and cable operators and encourages phone companies to
modernize their communications infrastructure. Certain types of
companies represented in the Trust's portfolio are engaged in fierce
competition for a share of the market of their products. As a result,
competitive pressures are intense and the stocks are subject to rapid
price volatility.
Many communications 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.
Page 2
e-Tail Portfolio Series
FT Series
PROSPECTUS NOTE: THIS PART THREE PROSPECTUS
Part Three MAY ONLY BE USED WITH
Dated November 30, 2000 PART ONE AND PART TWO
Each Trust contains a diversified portfolio of common stocks
("Securities") issued by companies in the industry sector or investment
focus for which each Trust is named. The objective of each Trust is to
provide above-average capital appreciation.
All Parts of the Prospectus Should be Retained for Future Reference.
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 (R)
1-800-621-9533
Page 1
Portfolio
Objectives.
The objective of each Trust is to provide the potential for above
average capital appreciation through an investment in common stocks of
retailers that market their goods and services on the Internet and the
technology companies that create the tools to make it possible.
Of course, as with any similar investments, there can be no guarantee
that the objective of the Trusts will be achieved. See "Risk Factors"
herein and in Part Two of this prospectus for a discussion of the risks
of investing in the Trusts.
Risk Factors
Retail Industry. Because more than 25% of each Trust is invested in
retail companies, these Trusts are considered to be concentrated in the
retail industry. A portfolio concentrated in a single industry may
present more risks than a portfolio which is 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 the capital to acquire and
maintain sophisticated technology. E-commerce company stocks have
experienced extreme price and volume fluctuations that are often
unrelated to their operating performance. Many such companies have
exceptionally high price-to-earnings ratios with little or no earnings
histories. In addition, numerous e-commerce companies have only recently
begun operations, and may have limited product lines, markets or
financial resources, as well as fewer experienced management personnel.
Finally, the lack of barriers to entry suggests a future of intense
competition for online retailers.
Technology Industry. The Trusts are also considered to be concentrated
in the technology industry. Technology companies are generally subject
to the risks of rapidly changing technologies; short product life
cycles; fierce competition; aggressive pricing and reduced profit
margins; the loss of patent, copyright and trademark protections;
cyclical market patterns; evolving industry standards and frequent new
product introductions. Technology companies may be smaller and less
experienced companies, with limited product lines, markets or financial
resources and fewer experienced management or marketing personnel.
Technology company stocks, especially those which are Internet-related,
have experienced extreme price and volume fluctuations that are often
unrelated to their operating performance. Also, the stocks of many
Internet companies have exceptionally high price-to-earnings ratios with
little or no earnings histories.
Public Offering
Discounts for Certain Persons.
If you invest at least $50,000 (except if you are purchasing for a "wrap
fee account" as described below), the maximum sales charge is reduced,
as follows:
Your maximum
If you invest sales charge
(in thousands):* will be:
_________________ ____________
$50 but less than $100 4.25%
$100 but less than $250 4.00%
$250 but less than $500 3.50%
$500 or more 2.50%
* The breakpoint sales charges are also applied on a Unit basis
utilizing a breakpoint equivalent in the above table of $10 per Unit and
will be applied on whichever basis is more favorable to the investor.
The breakpoints will be adjusted to take into consideration purchase
orders stated in dollars which cannot be completely fulfilled due to the
requirement that only whole Units be issued.
The reduced sales charge for quantity purchases will apply only to
purchases made by the same person on any one day from any one dealer. To
help you reach the above levels, you may combine same-day purchases of
Units of the Trusts and units of other similarly structured equity unit
trusts for which we act as Principal Underwriter and which are currently
in the initial offering period. In addition, we will consider Units you
Page 2
purchase in the name of your spouse or your child under 21 years of age
to be purchases by you for determining the reduced sales charge. The
reduced sales charges will also apply to a trustee or other fiduciary
purchasing Units for a single trust estate or single fiduciary account.
You must inform your dealer of any combined purchases before the sale in
order to be eligible for the reduced sales charge. Any reduced sales is
the responsibility of the party making the sale.
The following persons may purchase Units at the Public Offering Price
less the applicable dealer concession:
- Employees, officers and directors of the Sponsor, our related
companies, dealers and their affiliates, and vendors providing services
to us.
- Immediate family members of the above (spouses, children,
grandchildren, parents, grandparents, siblings, mothers-in-law, fathers-
in-law, sons-in-law, daughters-in-law, brothers-in-law and sisters-in-
law, and trustees, custodians or fiduciaries for the benefit of such
persons).
If you purchase Units through registered broker/dealers who charge
periodic fees for financial planning, investment advisory or asset
management services or provide these services as part of an investment
account where a comprehensive "wrap fee" charge is imposed, your Units
will only be assessed that portion of the sales charge retained by the
Sponsor.
Distribution of Units
We intend to qualify Units of the Trusts for sale in a number of states.
Units will be sold at the current Public Offering Price.
Dealer Concessions.
Dealers and other selling agents can purchase Units at prices which
represent a concession or agency commission of 65% of the then current
maximum sales charge.
Income and Capital Distributions
Distribution Reinvestment Option. You may elect to have each
distribution of income and/or capital reinvested into additional Units
of your Trust by notifying the Trustee at least 10 days before any
Record Date. Each later distribution of income and/or capital on your
Units will be reinvested by the Trustee into additional Units of your
Trust. This option may not be available in all states. PLEASE NOTE THAT
EVEN IF YOU REINVEST DISTRIBUTIONS, THEY ARE STILL CONSIDERED
DISTRIBUTIONS FOR INCOME TAX PURPOSES.
Other Information
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 3
FIRST TRUST(R)
e-Tail Portfolio Series
FT Series
PART THREE PROSPECTUS
Must be Accompanied by Parts One and Two
Sponsor:
Nike Securities L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS NOT LAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO, WHICH THE TRUST
HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940,
AND TO WHICH REFERENCE IS HEREBY MADE.
PLEASE RETAIN ALL PARTS OF THIS PROSPECTUS FOR FUTURE REFERENCE
Page 4
First Trust (R)
e-Tail Portfolio Series
The FT Series
Information Supplement
This Information Supplement provides additional information concerning
the structure, operations and risks of unit investment trusts ("Trusts")
contained in the Trusts not found in the prospectus. This Information
Supplement is not a prospectus and does not include all of the
information that a prospective investor should consider before investing
in a Trust. This Information Supplement should be read in conjunction
with the prospectus for the Trust in which an investor is considering
investing ("prospectus").
This Information Supplement is dated November 30, 2000. Capitalized
terms have been defined in the prospectus.
Table of Contents
Risk Factors
Securities 1
Dividends 1
Litigation
Microsoft Corporation 1
Concentration
Electronic Commerce 2
Technology 2
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.
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. 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.
Litigation
Microsoft Corporation. Microsoft Corporation is currently engaged in
litigation with Sun Microsystems, Inc., the U.S. Department of Justice
and several state Attorneys General. The complaints against Microsoft
include copyright infringement, unfair competition and anti-trust
violations. The claims seek injunctive relief and monetary damages. The
District Court handling the antitrust case recently held that Microsoft
exercised monopoly power in violation of the Sherman Antitrust Act and
various state antitrust laws. The court entered into a final judgment on
June 7, 2000 in which it called for Microsoft to be broken up into two
separate companies, one composed of the company's operating systems and
Page 1
the other containing its applications software business. The court also
called for significant operating restrictions to be placed on the
company until such time as the separation was completed. Microsoft has
stated that it will appeal the rulings against it after the penalty
phase and final decree. It is impossible to predict what impact the
penalties will have on Microsoft or the value of its stock.
Concentration
Electronic Commerce. An investment in Units of the Trusts should be made
with an understanding of the characteristics of the problems and risks
such an investment may entail. The Trusts consist of common stocks of
retailers that market their goods and services on the Internet and
technology companies that create the tools to make it possible. 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.
Retailers who sell their products over the Internet have the potential
to access more consumers, but will require the capital to acquire and
maintain sophisticated technology. E-commerce company stocks have
experienced extreme price and volume fluctuations that are often
unrelated to their operating performance. Many such companies have
exceptionally high price-to-earnings ratios with little or no earnings
histories. In addition, numerous e-commerce companies have only recently
begun operations, and may have limited product lines, markets or
financial resources, as well as fewer experienced management personnel.
Finally, the lack of barriers to entry suggests a future of intense
competition for online retailers.
See "Technology" below, for additional information concerning the risks
of companies engaged in the technology industry.
Technology. An investment in Units of the Trusts should be made with an
understanding of the characteristics of the problems and risks such an
investment may entail. 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
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
Page 2
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
the Trusts.
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.
Page 3
Internet Growth Trust Series
Internet Growth Portfolio Series
Internet Portfolio Series
The First Trust (R) Special Situations Trust
FT Series
PROSPECTUS NOTE: THIS PART THREE PROSPECTUS
Part Three MAY ONLY BE USED WITH
Dated November 30, 2000 PART ONE AND PART TWO
Each Trust contains a diversified portfolio of common stocks
("Securities") issued by companies in the industry sector or investment
focus for which each Trust is named. The objective of each Trust is to
provide above-average capital appreciation.
All Parts of the Prospectus Should be Retained for Future Reference.
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 (R)
1-800-621-9533
Page 1
Portfolio
Objectives.
The objective of each Trust is to provide the potential for above
average capital appreciation through an investment in common stocks of
technology companies which provide products or services for, or conduct
business on, the Internet.
Of course, as with any similar investments, there can be no guarantee
that the objective of the Trusts will be achieved. See "Risk Factors"
herein and in Part Two of this prospectus for a discussion of the risks
of investing in the Trusts.
Risk Factors
Technology Industry. Because more than 25% of each Trust is invested in
technology companies, these Trusts are considered to be concentrated in
the technology industry. A portfolio concentrated in a single industry
may present more risks than a portfolio which is broadly diversified
over several industries. Technology companies are generally subject to
the risks of rapidly changing technologies; short product life cycles;
fierce competition; aggressive pricing and reduced profit margins; the
loss of patent, copyright and trademark protections; cyclical market
patterns; evolving industry standards and frequent new product
introductions. Technology companies may be smaller and less experienced
companies, with limited product lines, markets or financial resources
and fewer experienced management or marketing personnel. Technology
company stocks, especially those which are Internet-related, have
experienced extreme price and volume fluctuations that are often
unrelated to their operating performance. Also, the stocks of many
Internet companies have exceptionally high price-to-earnings ratios with
little or no earnings histories.
Public Offering
Discounts for Certain Persons.
If you invest at least $50,000 (except if you are purchasing for a "wrap
fee account" as described below), the maximum sales charge is reduced,
as follows:
Your maximum
If you invest sales charge
(in thousands):* will be:
_________________ ____________
$50 but less than $100 4.25%
$100 but less than $250 4.00%
$250 but less than $500 3.50%
$500 or more 2.50%
* The breakpoint sales charges are also applied on a Unit basis
utilizing a breakpoint equivalent in the above table of $10 per Unit and
will be applied on whichever basis is more favorable to the investor.
The breakpoints will be adjusted to take into consideration purchase
orders stated in dollars which cannot be completely fulfilled due to the
requirement that only whole Units be issued.
The reduced sales charge for quantity purchases will apply only to
purchases made by the same person on any one day from any one dealer. To
help you reach the above levels, you may combine same-day purchases of
Units of the Trusts and units of other similarly structured equity unit
trusts for which we act as Principal Underwriter and which are currently
in the initial offering period. In addition, we will consider Units you
purchase in the name of your spouse or your child under 21 years of age
to be purchases by you for determining the reduced sales charge. The
reduced sales charges will also apply to a trustee or other fiduciary
purchasing Units for a single trust estate or single fiduciary account.
You must inform your dealer of any combined purchases before the sale in
order to be eligible for the reduced sales charge. Any reduced sales is
the responsibility of the party making the sale.
The following persons may purchase Units at the Public Offering Price
less the applicable dealer concession:
- Employees, officers and directors of the Sponsor, our related
companies, dealers and their affiliates, and vendors providing services
to us.
- Immediate family members of the above (spouses, children,
grandchildren, parents, grandparents, siblings, mothers-in-law, fathers-
in-law, sons-in-law, daughters-in-law, brothers-in-law and sisters-in-
law, and trustees, custodians or fiduciaries for the benefit of such
persons).
If you purchase Units through registered broker/dealers who charge
periodic fees for financial planning, investment advisory or asset
management services or provide these services as part of an investment
Page 2
account where a comprehensive "wrap fee" charge is imposed, your Units
will only be assessed that portion of the sales charge retained by the
Sponsor.
Distribution of Units
We intend to qualify Units of the Trusts for sale in a number of states.
Units will be sold at the current Public Offering Price.
Dealer Concessions.
Dealers and other selling agents can purchase Units at prices which
represent a concession or agency commission of 65% of the then current
maximum sales charge.
Income and Capital Distributions
Distribution Reinvestment Option. You may elect to have each
distribution of income and/or capital reinvested into additional Units
of your Trust by notifying the Trustee at least 10 days before any
Record Date. Each later distribution of income and/or capital on your
Units will be reinvested by the Trustee into additional Units of your
Trust. This option may not be available in all states. PLEASE NOTE THAT
EVEN IF YOU REINVEST DISTRIBUTIONS, THEY ARE STILL CONSIDERED
DISTRIBUTIONS FOR INCOME TAX PURPOSES.
Other Information
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 3
FIRST TRUST(R)
Internet Growth Trust Series
Internet Growth Portfolio Series
Internet Portfolio Series
The First Trust (R) Special Situations Trust
FT Series
PART THREE PROSPECTUS
Must be Accompanied by Parts One and Two
Sponsor:
Nike Securities L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS NOT LAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO, WHICH THE TRUST
HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940,
AND TO WHICH REFERENCE IS HEREBY MADE.
PLEASE RETAIN ALL PARTS OF THIS PROSPECTUS FOR FUTURE REFERENCE
Page 4
First Trust (R)
Internet Growth Trust Series
Internet Growth Portfolio Series
Internet Portfolio Series
The First Trust (R) Special Situations Trust
The FT Series
Information Supplement
This Information Supplement provides additional information concerning
the structure, operations and risks of unit investment trusts ("Trusts")
contained in the Trusts not found in the prospectus. This Information
Supplement is not a prospectus and does not include all of the
information that a prospective investor should consider before investing
in a Trust. This Information Supplement should be read in conjunction
with the prospectus for the Trust in which an investor is considering
investing ("prospectus").
This Information Supplement is dated November 30, 2000. Capitalized
terms have been defined in the prospectus.
Table of Contents
Risk Factors
Securities 1
Dividends 1
Litigation
Microsoft Corporation 1
Concentration
Technology 2
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.
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. 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.
Litigation
Microsoft Corporation. Microsoft Corporation is currently engaged in
litigation with Sun Microsystems, Inc., the U.S. Department of Justice
and several state Attorneys General. The complaints against Microsoft
include copyright infringement, unfair competition and anti-trust
violations. The claims seek injunctive relief and monetary damages. The
District Court handling the antitrust case recently held that Microsoft
exercised monopoly power in violation of the Sherman Antitrust Act and
various state antitrust laws. The court entered into a final judgment on
June 7, 2000 in which it called for Microsoft to be broken up into two
Page 1
separate companies, one composed of the company's operating systems and
the other containing its applications software business. The court also
called for significant operating restrictions to be placed on the
company until such time as the separation was completed. Microsoft has
stated that it will appeal the rulings against it after the penalty
phase and final decree. It is impossible to predict what impact the
penalties will have on Microsoft or the value of its stock.
Concentration
Technology. An investment in Units of the Trusts should be made with an
understanding of the characteristics of the problems and risks such an
investment may entail. 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
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
the Trusts.
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.
Page 2
Market Leaders Growth Trust Series
Market Leaders Portfolio Series
The First Trust (R) Special Situations Trust
FT Series
PROSPECTUS NOTE: THIS PART THREE PROSPECTUS
Part Three MAY ONLY BE USED WITH
Dated November 30, 2000 PART ONE AND PART TWO
Each Trust contains a diversified portfolio of common stocks
("Securities") issued by companies in the industry sector or investment
focus for which each Trust is named. The objective of each Trust is to
provide above-average capital appreciation.
All Parts of the Prospectus Should be Retained for Future Reference.
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 (R)
1-800-621-9533
Page 1
Portfolio
Objectives.
The objective of each Trust is to provide the potential for above
average capital appreciation through an investment in common stocks of
companies that are widely regarded as front-runners in their respective
industries.
Of course, as with any similar investments, there can be no guarantee
that the objective of the Trusts will be achieved. See "Risk Factors"
herein and in Part Two of this prospectus for a discussion of the risks
of investing in the Trusts.
Risk Factors
Market Leaders. Because more than 25% of each Trust is invested in
Berkshire Hathaway, Inc. common stock and the common stock of certain
companies in which Berkshire Hathaway, Inc. owns an equity interest,
these Trusts are considered to be concentrated in Berkshire Hathaway,
Inc. A portfolio concentrated in a single industry or company may
present more risks than a portfolio which is broadly diversified over
several industries or companies. This lack of diversification increases
risks to investors. Berkshire Hathaway, Inc. and the other issuers of
Securities included in the Trusts have in no way participated in the
creation of these Trusts.
Public Offering
Discounts for Certain Persons.
If you invest at least $50,000 (except if you are purchasing for a "wrap
fee account" as described below), the maximum sales charge is reduced,
as follows:
Your maximum
If you invest sales charge
(in thousands):* will be:
_________________ ____________
$50 but less than $100 4.25%
$100 but less than $250 4.00%
$250 but less than $500 3.50%
$500 or more 2.50%
* The breakpoint sales charges are also applied on a Unit basis
utilizing a breakpoint equivalent in the above table of $10 per Unit and
will be applied on whichever basis is more favorable to the investor.
The breakpoints will be adjusted to take into consideration purchase
orders stated in dollars which cannot be completely fulfilled due to the
requirement that only whole Units be issued.
The reduced sales charge for quantity purchases will apply only to
purchases made by the same person on any one day from any one dealer. To
help you reach the above levels, you may combine same-day purchases of
Units of the Trusts and units of other similarly structured equity unit
trusts for which we act as Principal Underwriter and which are currently
in the initial offering period. In addition, we will consider Units you
purchase in the name of your spouse or your child under 21 years of age
to be purchases by you for determining the reduced sales charge. The
reduced sales charges will also apply to a trustee or other fiduciary
purchasing Units for a single trust estate or single fiduciary account.
You must inform your dealer of any combined purchases before the sale in
order to be eligible for the reduced sales charge. Any reduced sales is
the responsibility of the party making the sale.
The following persons may purchase Units at the Public Offering Price
less the applicable dealer concession:
- Employees, officers and directors of the Sponsor, our related
companies, dealers and their affiliates, and vendors providing services
to us.
- Immediate family members of the above (spouses, children,
grandchildren, parents, grandparents, siblings, mothers-in-law, fathers-
in-law, sons-in-law, daughters-in-law, brothers-in-law and sisters-in-
law, and trustees, custodians or fiduciaries for the benefit of such
persons).
If you purchase Units through registered broker/dealers who charge
periodic fees for financial planning, investment advisory or asset
management services or provide these services as part of an investment
account where a comprehensive "wrap fee" charge is imposed, your Units
will only be assessed that portion of the sales charge retained by the
Sponsor.
Distribution of Units
We intend to qualify Units of the Trusts for sale in a number of states.
Units will be sold at the current Public Offering Price.
Page 2
Dealer Concessions.
Dealers and other selling agents can purchase Units at prices which
represent a concession or agency commission of 65% of the then current
maximum sales charge.
Income and Capital Distributions
Distribution Reinvestment Option. You may elect to have each
distribution of income and/or capital reinvested into additional Units
of your Trust by notifying the Trustee at least 10 days before any
Record Date. Each later distribution of income and/or capital on your
Units will be reinvested by the Trustee into additional Units of your
Trust. This option may not be available in all states. PLEASE NOTE THAT
EVEN IF YOU REINVEST DISTRIBUTIONS, THEY ARE STILL CONSIDERED
DISTRIBUTIONS FOR INCOME TAX PURPOSES.
Other Information
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 3
FIRST TRUST(R)
Market Leaders Growth Trust Series
Market Leaders Portfolio Series
The First Trust (R) Special Situations Trust
FT Series
PART THREE PROSPECTUS
Must be Accompanied by Parts One and Two
Sponsor:
Nike Securities L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS NOT LAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO, WHICH THE TRUST
HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940,
AND TO WHICH REFERENCE IS HEREBY MADE.
PLEASE RETAIN ALL PARTS OF THIS PROSPECTUS FOR FUTURE REFERENCE
Page 4
First Trust (R)
Market Leaders Growth Trust Series
Market Leaders Portfolio Series
The First Trust (R) Special Situations Trust
The FT Series
Information Supplement
This Information Supplement provides additional information concerning
the structure, operations and risks of unit investment trusts ("Trusts")
contained in the Trusts not found in the prospectus. This Information
Supplement is not a prospectus and does not include all of the
information that a prospective investor should consider before investing
in a Trust. This Information Supplement should be read in conjunction
with the prospectus for the Trust in which an investor is considering
investing ("prospectus").
This Information Supplement is dated November 30, 2000. Capitalized
terms have been defined in the prospectus.
Table of Contents
Risk Factors
Securities 1
Dividends 1
Concentration
Market Leaders 1
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.
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. 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.
Concentration
Market Leaders. The Market Leaders Trusts are concentrated in Berkshire
Hathaway, Inc. common stock and the common stock of certain companies in
which Berkshire Hathaway, Inc. owns an equity interest. This lack of
diversification increases risks to investors. Berkshire Hathaway, Inc.
and the other issuers of Securities included in the Trusts have in no
way participated in the creation of these Trusts.
Page 1
Retail Growth Trust Series
Retail Growth Portfolio Series
Retail Portfolio Series
FT Series
PROSPECTUS NOTE: THIS PART THREE PROSPECTUS
Part Three MAY ONLY BE USED WITH
Dated November 30, 2000 PART ONE AND PART TWO
Each Trust contains a diversified portfolio of common stocks
("Securities") issued by companies in the industry sector or investment
focus for which each Trust is named. The objective of each Trust is to
provide above-average capital appreciation.
All Parts of the Prospectus Should be Retained for Future Reference.
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 (R)
1-800-621-9533
Page 1
Portfolio
Objectives.
The objective of each Trust is to provide the potential for above
average capital appreciation through an investment in common stocks of
retail companies.
Of course, as with any similar investments, there can be no guarantee
that the objective of the Trusts will be achieved. See "Risk Factors"
herein and in Part Two of this prospectus for a discussion of the risks
of investing in the Trusts.
Risk Factors
Retail Industry. Because more than 25% of each Trust is invested in
retail companies, each Trust is considered to be concentrated in the
retail industry. A portfolio concentrated in a single industry may
present more risks than a portfolio which is 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 the capital to acquire and
maintain sophisticated technology. E-commerce company stocks have
experienced extreme price and volume fluctuations that are often
unrelated to their operating performance. Many such companies have
exceptionally high price-to-earnings ratios with little or no earnings
histories. In addition, numerous e-commerce companies have only recently
begun operations, and may have limited product lines, markets or
financial resources, as well as fewer experienced management personnel.
Finally, the lack of barriers to entry suggests a future of intense
competition for online retailers.
Public Offering
Discounts for Certain Persons.
If you invest at least $50,000 (except if you are purchasing for a "wrap
fee account" as described below), the maximum sales charge is reduced,
as follows:
Your maximum
If you invest sales charge
(in thousands):* will be:
_________________ ____________
$50 but less than $100 4.25%
$100 but less than $250 4.00%
$250 but less than $500 3.50%
$500 or more 2.50%
* The breakpoint sales charges are also applied on a Unit basis
utilizing a breakpoint equivalent in the above table of $10 per Unit and
will be applied on whichever basis is more favorable to the investor.
The breakpoints will be adjusted to take into consideration purchase
orders stated in dollars which cannot be completely fulfilled due to the
requirement that only whole Units be issued.
The reduced sales charge for quantity purchases will apply only to
purchases made by the same person on any one day from any one dealer. To
help you reach the above levels, you may combine same-day purchases of
Units of the Trusts and units of other similarly structured equity unit
trusts for which we act as Principal Underwriter and which are currently
in the initial offering period. In addition, we will consider Units you
purchase in the name of your spouse or your child under 21 years of age
to be purchases by you for determining the reduced sales charge. The
reduced sales charges will also apply to a trustee or other fiduciary
purchasing Units for a single trust estate or single fiduciary account.
You must inform your dealer of any combined purchases before the sale in
order to be eligible for the reduced sales charge. Any reduced sales is
the responsibility of the party making the sale.
The following persons may purchase Units at the Public Offering Price
less the applicable dealer concession:
- Employees, officers and directors of the Sponsor, our related
companies, dealers and their affiliates, and vendors providing services
to us.
- Immediate family members of the above (spouses, children,
grandchildren, parents, grandparents, siblings, mothers-in-law, fathers-
Page 2
in-law, sons-in-law, daughters-in-law, brothers-in-law and sisters-in-
law, and trustees, custodians or fiduciaries for the benefit of such
persons).
If you purchase Units through registered broker/dealers who charge
periodic fees for financial planning, investment advisory or asset
management services or provide these services as part of an investment
account where a comprehensive "wrap fee" charge is imposed, your Units
will only be assessed that portion of the sales charge retained by the
Sponsor.
Distribution of Units
We intend to qualify Units of the Trusts for sale in a number of states.
Units will be sold at the current Public Offering Price.
Dealer Concessions.
Dealers and other selling agents can purchase Units at prices which
represent a concession or agency commission of 65% of the then current
maximum sales charge.
Income and Capital Distributions
Distribution Reinvestment Option. You may elect to have each
distribution of income and/or capital reinvested into additional Units
of your Trust by notifying the Trustee at least 10 days before any
Record Date. Each later distribution of income and/or capital on your
Units will be reinvested by the Trustee into additional Units of your
Trust. This option may not be available in all states. PLEASE NOTE THAT
EVEN IF YOU REINVEST DISTRIBUTIONS, THEY ARE STILL CONSIDERED
DISTRIBUTIONS FOR INCOME TAX PURPOSES.
Other Information
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 3
FIRST TRUST(R)
Retail Growth Trust Series
Retail Growth Portfolio Series
Retail Portfolio Series
FT Series
PART THREE PROSPECTUS
Must be Accompanied by Parts One and Two
Sponsor:
Nike Securities L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
The Chase Manhattan Bank
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS NOT LAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
THIS PROSPECTUS DOES NOT CONTAIN ALL THE INFORMATION SET FORTH IN THE
REGISTRATION STATEMENTS AND EXHIBITS RELATING THERETO, WHICH THE TRUST
HAS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, WASHINGTON, D.C.
UNDER THE SECURITIES ACT OF 1933 AND THE INVESTMENT COMPANY ACT OF 1940,
AND TO WHICH REFERENCE IS HEREBY MADE.
PLEASE RETAIN ALL PARTS OF THIS PROSPECTUS FOR FUTURE REFERENCE
Page 4
First Trust (R)
Retail Growth Trust Series
Retail Growth Portfolio Series
Retail Portfolio Series
The FT Series
Information Supplement
This Information Supplement provides additional information concerning
the structure, operations and risks of unit investment trusts ("Trusts")
contained in the Trusts not found in the prospectus. This Information
Supplement is not a prospectus and does not include all of the
information that a prospective investor should consider before investing
in a Trust. This Information Supplement should be read in conjunction
with the prospectus for the Trust in which an investor is considering
investing ("prospectus").
This Information Supplement is dated November 30, 2000. Capitalized
terms have been defined in the prospectus.
Table of Contents
Risk Factors
Securities 1
Dividends 1
Concentration
Retail 1
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.
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. 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.
Concentration
Retail. An investment in Units of the Trusts should be made with an
understanding of the characteristics of the problems and risks such an
investment may entail. 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
Page 1
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.
Page 2
CONTENTS OF POST-EFFECTIVE AMENDMENT
OF REGISTRATION STATEMENT
This Post-Effective Amendment of Registration Statement
comprises the following papers and documents:
The facing sheet
The prospectus
The signatures
The Consent of Independent Auditors
S-1
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant, FT 371 AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
BIOTECHNOLOGY PORTFOLIO SERIES
COMMUNICATIONS PORTFOLIO, SERIES 5
E-TAIL PORTFOLIO SERIES
INTERNET PORTFOLIO, SERIES 8
MARKET LEADERS PORTFOLIO, SERIES 4
RETAIL PORTFOLIO, SERIES 4, certifies that it meets all of the
requirements for effectiveness of this Registration Statement
pursuant to Rule 485(b) under the Securities Act of 1933 and has
duly caused this Post-Effective Amendment of its Registration
Statement to be signed on its behalf by the undersigned thereunto
duly authorized in the Village of Lisle and State of Illinois on
November 30, 2000.
FT 371
AMERICA'S LEADING BRANDS PORTFOLIO, SERIES 6
BIOTECHNOLOGY PORTFOLIO SERIES
COMMUNICATIONS PORTFOLIO, SERIES 5
E-TAIL PORTFOLIO SERIES
INTERNET PORTFOLIO, SERIES 8
MARKET LEADERS PORTFOLIO, SERIES 4
RETAIL PORTFOLIO, SERIES 4
(Registrant)
By NIKE SECURITIES L.P.
(Depositor)
By Robert M. Porcellino
Senior Vice President
Pursuant to the requirements of the Securities Act of 1933,
this Post-Effective Amendment of Registration Statement has been
signed below by the following person in the capacity and on the
date indicated:
Signature Title Date
David J. Allen Sole Director of )
Nike Securities )
Corporation, ) November 30, 2000
the 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-2
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption
"Experts" and to the use of our report dated November 9, 2000 in
this Post-Effective Amendment to the Registration Statement and
related Prospectus FT Series dated November 28, 2000.
ERNST & YOUNG LLP
Chicago, Illinois
November 27, 2000
