<PAGE>
As filed with the Securities and Exchange Commission on November 18, 1999
Registration No. 333-90875
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
AMENDMENT NO. 1
TO
FORM S-6
For Registration Under the Securities Act
of 1933 of Securities of Unit Investment
Trusts Registered on Form N-8B-2
----------------
A.EXACT NAME OF TRUST:
Equity Securities Trust, Series 25, Symphony Series, Zacks All-Star
Analysts Trust V
B.NAME OF DEPOSITOR:
Reich & Tang Distributors, Inc.
C.COMPLETE ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES:
Reich & Tang Distributors, Inc.
600 Fifth Avenue
New York, New York 10020
D.NAME AND COMPLETE ADDRESS OF AGENT FOR SERVICE:
<TABLE>
<CAPTION>
<S> <C>
COPY OF COMMENTS TO:
PETER J. DEMARCO MICHAEL R. ROSELLA, Esq.
Reich & Tang Distributors, Inc. Battle Fowler LLP
600 Fifth Avenue 75 East 55th Street
New York, New York 10020 New York, New York 10022
(212) 856-6858
E.TITLE AND AMOUNT OF SECURITIES BEING REGISTERED:
</TABLE>
An indefinite number of Units of Equity Securities Trust, Series 25,
Symphony Series, Zacks All-Star Analysts Trust V is being registered under
the Securities Act of 1933 pursuant to Section 24(f) of the Investment
Company Act of 1940, as amended, and Rule 24f-2 thereunder.
F. PROPOSED MAXIMUM AGGREGATE OFFERING PRICE TO THE PUBLIC OF THE SECURITIES
BEING REGISTERED:
Indefinite
G.AMOUNT OF FILING FEE:
No Filing Fee Required
H.APPROPRIATE DATE OF PROPOSED PUBLIC OFFERING:
As soon as practicable after the effective date of the Registration
Statement.
[X]Check if it is proposed that this filing will become effective immediately
upon filing pursuant to Rule 487.
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<PAGE>
[LOGO]
EST
EQUITY SECURITIES TRUST
SERIES 25
SYMPHONY SERIES, ZACKS ALL-STAR ANALYSTS TRUST V
The Trust is a unit investment trust designated Equity Securities Trust,
Series 25, Symphony Series, Zacks All-Star Analysts Trust V. The Sponsor is
Reich & Tang Distributors, Inc. The Trust consists of a fixed portfolio of
common stock which have been purchased by the Trust based upon the
recommendations of the portfolio consultant, Zacks Investment Research Inc.
(also referred to as "Zacks" throughout this Prospectus.) The Trust seeks to
achieve capital appreciation. Current income is a secondary objective of the
Trust. The Sponsor cannot assure that the Trust will achieve these
objectives. The minimum purchase is 100 Units.
This Prospectus consists of two parts. Part A contains the Summary of
Essential Information including summary material relating to the Trust, the
Portfolio and the Statement of Financial Condition of the Trust. Part B
contains more detailed information about the Trust. Part A may not be
distributed unless accompanied by Part B. Please read and retain both parts
of this Prospectus for future reference.
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- --------------------------------------------------------------------------------
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED
THESE SECURITIES OR PASSED UPON THE ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
PROSPECTUS DATED NOVEMBER 18, 1999
<PAGE>
OBJECTIVES. The Trust seeks to achieve capital appreciation. Current income is
a secondary objective. There is no guarantee that the objectives of the Trust
will be achieved.
PORTFOLIO SELECTION. The Trust seeks to achieve its objectives by investing in
a portfolio of equity securities, each of which has been recommended as a "buy"
and "strong buy" by three or more Zacks/Wall Street Journal All-Star Analysts
*. The term "All-Star Analysts" refers to analysts employed by U.S. brokerage
firms who have had exceptional track records in selecting stocks. These top
analysts have been identified and monitored by Zacks as part of Zacks' analysis
of the historical performance of brokerage analyst stock recommendations in
conjunction with the annual publication of the Zacks/Wall Street Journal All-
Star Analysts Survey (see "The Trust--The Securities" in Part B). As used
herein, the term "Securities" means the common stocks initially deposited in
the Trust and contracts and funds for the purchase of such securities, and any
additional securities acquired and held by the Trust pursuant to the provisions
of the Indenture.
DESCRIPTION OF PORTFOLIO. The Portfolio contains 19 issues of domestic common
stock. 100% of the issues are represented by the Sponsor's contracts to
purchase. Based upon the principle business of each issuer and current market
values, the following industries are represented in the Portfolio**: Basic
Materials, 2.98%; Computer/Technology, 28.65%; Consumer Discretionary, 4.55%;
Consumer Staples, 8.32%; Finance, 16.64%; Industrial Products, 2.2%; Medical,
11.73%; Oils-Energy,7.18%; Retail-Wholesale, 8.04%; and Utilities, 9.71%.
57.72% of the Portfolio is listed on the New York Stock Exchange and 42.28% are
over-the-counter.
RISK CONSIDERATIONS. Unitholders can lose money by investing in this Trust. An
investment in units of the Trust should be made with an understanding of the
following risks:
. The Securities are shares of common stock which are subject to the risk
that the financial condition of the issuers may become impaired or that
the general condition of the stock market may worsen.
. Since the portfolio of the Trust is fixed and "not managed," in general
the Sponsor can only sell securities at (i) the Trust's termination (ii)
in order to meet redemptions (iii) or in order to pay the deferred sales
charge. As a result, the price at which each security is sold may not be
the highest price it attained during the life of the Trust.
. When cash or a letter of credit is deposited with instructions to
purchase securities in order to create additional units, an increase in
the price of a particular security between the time of deposit and the
time that securities are purchased will cause the units to be comprised
of less of that security and more of the remaining securities. In
addition, brokerage fees incurred in purchasing the Securities will be
an expense of the Trust.
. A decline in the value of the Securities during the initial offering
period may require additional Securities to be sold in order to
reimburse the Sponsor for organization costs. This would result in a
decline in value of the Units.
. Securities price fluctuations during the period from the time of deposit
to the time the Securities are purchased, and payment of brokerage fees,
will affect the value of each Unit and the income per Unit received by
the Trusts.
- --------
* The Wall Street Journal and its publisher, Dow, Jones & Company, Inc., have
no interest in the Trust, have not endorsed the Trust, and have no opinion
about the suitability of the Trust as an investment. Neither Dow Jones nor the
Wall Street Journal has participated in or will participate in the selection of
securities for the Trust.
** A trust is considered to be "concentrated" in a particular category or
industry when the securities in that category or that industry constitute 25%
or more of the aggregate face amount of the portfolio.
A-2
<PAGE>
. Investors should also consider the greater risk of a Trust's
concentration, in a particular industry or in a single stock, and the
effect on their investment versus a more diversified portfolio.
Investors should compare returns available in less concentrated
portfolios before making an investment decision.
. Since the Trusts are concentrated in stocks which derive a substantial
portion of their income from the computer and computer technology
industries, investors should be familiar with the risks associated with
these industries which may include the volatile price of computer and
technology stocks, greater government regulations and products that may
become obsolete.
. A decline in the value of the Securities during the initial offering
period may require additional Securities to be sold in order to
reimburse the Sponsor for organization costs. This would result in a
decline in value of the units.
PUBLIC OFFERING PRICE. The Public Offering Price per 100 units of the Trust is
calculated by:
. dividing the aggregate value of the underlying securities and cash held
in the Trust by the number of units outstanding;
. adding an initial sales charge of 1.00% (1.010% of the net amount
invested); and
. multiplying the result by 100.
In addition, during the initial offering period, an amount sufficient to
reimburse the Sponsor for the payment of all or a portion of the estimated
organization costs of the Trust will be added to the Public Offering Price per
100 units. The price of a single unit, or any multiple thereof, is calculated
by dividing the Public Offering Price per 100 units by 100 and multiplying by
the number of units. During the initial offering period, orders involving at
least 10,000 units will be entitled to a volume discount from the Public
Offering Price. The Public Offering Price per Unit may vary on a daily basis in
accordance with fluctuations in the aggregate value of the underlying
Securities and each investors purchase price will be computed as of the date
the units are purchased.
ESTIMATED NET ANNUAL DISTRIBUTIONS. The estimated net annual distributions to
unitholders per 100 units (based on the most recent monthly ordinary dividend
declared with respect to the Securities) was $13.68. This estimate will vary
with changes in the Trust's fees and expenses, actual dividends received, and
with the sale of Securities. In addition, because the issuers of common stock
are not obligated to pay dividends, there is no assurance that the estimated
net annual dividend distributions will be realized in the future.
DISTRIBUTIONS. The Trust will distribute dividends received, less expenses,
semi-annually. The Trust does not currently anticipate distributing dividends.
However, in the event any dividend distributions are made, the first dividend
distribution will be made on June 30, 2000 to all Unitholders of record on June
30, 2000 and thereafter distributions will be made on the last business day of
December. The final distribution will be made within a reasonable period of
time after the Trust terminates.
MARKET FOR UNITS. Unitholders may sell their units to the Sponsor or the
Trustee any time, without fee or penalty. However, the Sponsor intends to
repurchase units from unitholders throughout the life of the Trust at prices
based upon the market value of the underlying Securities. However, the Sponsor
is not obligated to maintain a market and may stop doing so without prior
notice for any business reason. If a market is not maintained a unitholder will
be able to redeem his units with the Trustee at the same price. The existence
of a liquid trading market for these Securities may depend on whether dealers
will make a market in these Securities. There can be no assurance of the making
or the maintenance of a market for any of the Securities
A-3
<PAGE>
contained in the portfolio of the Trust or of the liquidity of the Securities
in any markets made. The price at which the Securities may be sold to meet
redemptions and the value of the Units will be adversely affected if trading
markets for the Securities are limited or absent.
TERMINATION. The Trust will terminate in approximately fifteen months. At that
time investors may choose one of the following three options with respect to
their terminating distribution:
. receive the distribution in-kind if they own at least 2,500 Units;
. receive cash upon the liquidation of their pro rata share of the
Securities; or
. reinvest in a subsequent series of the Equity Securities Trust (if one is
offered) at a reduced sales charge.
REINVESTMENT PLAN. Unitholders may elect to automatically reinvest their
distributions, if any (other than the final distribution in connection with the
termination of the Trust) into additional units of the Trust, subject only to
the remaining monthly deductions of the deferred sales charge. See
"Reinvestment Plan" in Part B for details on how to enroll in the Reinvestment
Plan.
UNDERWRITING. Reich & Tang Distributors, Inc., 600 Fifth Avenue, New York, New
York 10020, will act as Underwriter for all of the Units of Equity Securities
Trust, Series 25, Symphony Series, Zacks All-Star Analysts Trust V.
A-4
<PAGE>
FEE TABLE
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This Fee Table is intended to help you to understand the costs and expenses
that you will bear directly or indirectly. See "Public Offering and Trust
Expenses and Charges." Although the Trust is a unit investment trust rather
than a mutual fund, this information is presented to permit a comparison of
fees.
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<TABLE>
<CAPTION>
As a % of Amount
Unitholder Transaction Expenses Initial per
(fees paid directly from your investment) Offering Price 100 Units
- ----------------------------------------- -------------- ---------
<S> <C> <C> <C> <C>
Maximum Initial Sales Charges Imposed on
Purchase (as a percentage of offering
price)................................... 1.00%* $10.00
Maximum Deferred Sales Charge............. 1.95%** $19.50
---- ------
Total..................................... 2.95% $29.50
==== ======
Maximum Sales Charge Imposed Per Year on
Reinvested Dividends..................... 1.95%*** $19.50
Reimbursement to Sponsor for Estimated
Organization Expenses.................... .130% $ 1.30
<CAPTION>
Estimated Annual Fund Operating Expenses As a % of Amount
(Expenses that are deducted from Trust Initial per
assets) Net Assets 100 Units
- ---------------------------------------- -------------- ---------
<S> <C> <C> <C> <C>
Trustee's Fee............................. .086% $ .86
Other Operating Expenses.................. .039% $ .39
Portfolio Supervision, Bookkeeping and
Administrative Fees.................... .030% $.30
---- ------
Total..................................... .125% $ 1.25
==== ======
</TABLE>
Example
This Example is intended to help you compare the cost of investing in the Trust
with the cost of investing in other unit trusts.
<TABLE>
<CAPTION>
1
year
<S> <C>
This Example assumes that you invest $10,000 in the Trust for the time
period indicated, assuming the Trust's estimated operating expense ratio
of .125% and a 5% return on the investment throughout the period. Although
your actual costs may be higher or lower, based on these assumptions, your
costs would be:........................................................... $321
</TABLE>
The Example assumes reinvestment of all dividends and distributions and
utilizes a 5% annual rate of return as mandated by Securities and Exchange
Commission regulations applicable to mutual funds. The Example should not be
considered a representation of past or future expenses or a annual rate of
return; the actual expenses and annual rate of return may be more or less than
those assumed for purposes of the Example.
- --------
* The Initial Sales Charge would exceed 1.00% if the Public Offering Price
exceeds $10.00 per 100 Units.
** The actual fee is $1.95 per month per 100 Units paid on each Deferred Sales
Charge Payment Date. If the Unit price exceeds $10.00 per Unit, the
deferred sales charge will be less than 1.95%; if the Unit price is less
than $10.00 per Unit, the deferred sales charge will exceed 1.95%
*** Reinvested dividends will be subject only to the deferred sales charge
remaining at the time of reinvestment.
A-5
<PAGE>
SUMMARY OF ESSENTIAL INFORMATION
As of November 17, 1999:*
Initial Date of Deposit: November 18, 1999
<TABLE>
<S> <C>
Aggregate Value of Securities........................................ $ 149,296
Number of Units...................................................... 15,100
Fractional Undivided Interest in Trust............................... 1/15,100
Public Offering Price per 100 Units $
Aggregate Value of Securities in
Trust............................................................... $ 149,296
Divided By 15,100 Units (times 100) ................................. $ 988.70
Plus Initial Charge of 1.00% of Public
Offering Price(degrees)............................................. $ 10.00
Plus Estimated Organization Costs**.................................. $ 1.30
Public Offering Price+............................................... $1,000.00
Sponsor's Repurchase Price And Redemption Price Per 100 Units++...... $970.50
</TABLE>
Evaluation Time: 4:00 p.m. New York Time.
Minimum Income or Principal Distribution: $1.00 per 100 Units
Liquidation Period: Beginning five days prior to the Mandatory Termination
Date.
Rollover Notification Date: February 7, 2001 or another date as determined by
the Sponsor.
Minimum Value of Trust: The Trust may be terminated if the value of the Trust
is less than 40% of the aggregate value of the Securities at the completion of
the Deposit Period.
Mandatory Termination Date: The earlier of February 21, 2001 or the disposition
of the last Security in the Trust.
CUSIP Numbers: Cash: 294762 539
Reinvestment: 294762 547
Trustee: The Chase Manhattan Bank
Trustee's Fee: $.86 per 100 Units outstanding
Other Fees and Expenses: $.09 per 100 Units outstanding
Sponsor: Reich & Tang Distributors, Inc.
Sponsor's Supervisory Fee: Maximum of $.30 per 100 Units outstanding (see
"Trust Expenses and Charges" in Part B).
Portfolio Consultant:
Zacks Investment Research Inc.
Expected Settlement Date of Securities in the Trust: November 23, 1999
Record Dates: June 15 and December 15
Distribution Dates: June 30 and December 31
Deferred Sales Charge Payment Dates: The first business day of each month
commencing March 1, 2000 through December 1, 2000.
- --------
* The business day prior to the Initial Date of Deposit. The Initial Date of
Deposit is the date on which the Trust Agreement was signed and the deposit of
securities with the Trustee made.
** This amount per 100 Units will be invested in Securities during, and sold at
the end of, the initial offering period, to reimburse the Sponsor for the
payment of all or a portion of the estimated costs incurred in organizing the
Trust. See "Risk Considerations" for a discussion of the impact of a decrease
in value of the Securities purchased with the Public Offering Price proceeds
intended to be used to reimburse the Sponsor.
+ On the Initial Date of Deposit there will be no cash in the Income or
Principal Accounts. Anyone purchasing Units after such date will have included
in the Public Offering Price a pro rata share of any cash in such Accounts.
++ As of the close of the initial offering period, the Sponsor's Repurchase
Price and Redemption Price per 100 Units for the Trust will be reduced to
reflect the payment of the organization costs to the Sponsor.
(degrees) The sales charge consists of an initial sales charge and a deferred
sales charge. On the Initial Date of Deposit the initial sales charge is 1.00%
of the Public Offering Price. The initial sales charge is paid directly from
the amount invested. The deferred sales charge of approximately $19.50
(approximately 1.95% of the Initial Public Offering Price) is paid through a
reduction of the net asset value of the Trust by $1.95 per 100 units on each of
the ten Deferred Sales Charge Payment Dates. Upon a repurchase, redemption or
exchange of units before the final Deferred Sales Charge Payment Date, any
remaining deferred sales charge payments will be deducted from the proceeds.
A-6
<PAGE>
EQUITY SECURITIES TRUST
SERIES 25
SYMPHONY SERIES, ZACKS ALL-STAR ANALYSTS TRUST V
STATEMENT OF FINANCIAL CONDITION AS OF OPENING OF BUSINESS, NOVEMBER 18, 1999
ASSETS
<TABLE>
<S> <C>
Investment in Securities--Sponsor's Contracts to Purchase
Underlying Securities Backed by Letter of Credit (cost
$149,492)(Note 1)................................................. $149,492
--------
Total................................................................ $149,492
========
</TABLE>
LIABILITIES AND INTEREST OF UNITHOLDERS
<TABLE>
<S> <C>
Reimbursement to Sponsor for Organization Costs (Note 2) ............ $ 196
Interest of Unitholders--Units of Fractional Undivided Interest
Outstanding (15,100 Units).......................................... 149,492
Less: Reimbursement to Sponsor for Organization Costs (Note 2)..... (196)
--------
Total................................................................ $149,492
========
Net Asset Value per Unit............................................. $ 9.90
========
</TABLE>
- --------
Notes to Statement:
(1) Trust is a unit investment trust created under the laws of the State of
New York and registered under the Investment Company Act of 1940. The Trust,
sponsored by Reich & Tang Distributors, Inc. (the "Sponsor"), seeks to achieve
capital appreciation. Current income is a secondary objective. On November 18,
1999 (the "Date of Deposit"), Portfolio deposits were received by The Chase
Manhattan Bank, the Trust's Trustee, in the form of executed securities
transactions, in exchange for 15,100 units of the Trust. An irrevocable letter
of credit issued by the BankBoston, N.A. in an amount of $400,000 has been
deposited with the Trustee for the benefit of the Trust to cover the purchases
of such Securities as well as any outstanding purchases of previously-sponsored
unit investment trusts of the Sponsor. Aggregate cost to the Trust of the
Securities listed in the Portfolio is determined by the Trustee on the basis
set forth under "Public Offering--Offering Price" as of 4:00 p.m. on November
17, 1999. The Trust will terminate on February 21, 2001, or earlier under
certain circumstances as further described in the Prospectus.
(2) A portion of the Public Offering Price consists of an amount sufficient
to reimburse the Sponsor for all or a portion of the costs of establishing the
Trust. These costs have been estimated at $1.30 per 100 Units. A payment will
be made as of the close of the initial public offering period to an account
maintained by the Trustee from which the obligation of the investors to the
Sponsor will be satisfied. To the extent that actual organization costs are
greater than the estimated amount, only the estimated organization costs
included in the Public Offering Price will be reimbursed to the Sponsor and
deducted from the assets of the Trust.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts and disclosures. Actual results could differ
from those estimates.
A-7
<PAGE>
EQUITY SECURITIES TRUST
SERIES 25
SYMPHONY SERIES, ZACKS ALL-STAR ANALYSTS TRUST V
PORTFOLIO
AS OF OPENING OF BUSINESS, NOVEMBER 18, 1999
<TABLE>
<CAPTION>
Market
Value of
Stocks as a
Number Percentage Market Cost of
Portfolio of Ticker of the Value Per Securities to
No. Shares Name of Issuer (1) Symbol Trust (2) Share the Trust (3)
--------- ------ ------------------ ------ ----------- --------- -------------
<C> <C> <C> <S> <C> <C> <C> <C>
Basic Materials: 2.98%
1 71 Alcoa, Inc. AA 2.98% $ 62.6875 $ 4,451
Computer Technology: 28.65%
2 127 Cisco Systems, Inc. CSCO 7.20 84.7500 10,763
3 144 Intel Corp. INTC 7.20 74.7500 10,764
4 119 Novellus Systems, Inc. NVLS 7.08 88.8750 10,576
5 52 Yahoo! Inc. YHOO 7.17 206.1875 10,722
Consumer Discretionary: 4.55%
6 129 Viacom, Inc. VIA.B 4.55 52.7500 6,805
Consumer Staples: 8.32%
7 83 Anheuser-Busch BUD 4.17 75.0625 6,230
Companies, Inc.
8 182 PepsiCo. Inc. PEP 4.15 34.1250 6,211
Finance: 16.64%
9 75 American International AIG 5.53 110.3125 8,273
Group, Inc.
10 160 Hartford Life, Inc. HLI 5.59 52.2500 8,360
11 202 Nationwide Financial NFS 5.52 40.8750 8,257
Services, Inc.
Industrial Products: 2.20%
12 118 Terex Corp. TEX 2.20 27.8750 3,289
Medical: 11.73%
13 111 American Home Products AHP 3.89 52.4375 5,821
Corp.
14 76 Biogen, Inc. BGEN 3.92 77.0625 5,857
15 78 Eli Lilly & Co. LLY 3.92 75.0625 5,855
Oils--Energy: 7.18%
16 676 Union Pacific Resources UPR 7.18 15.8750 10,732
Group, Inc.
Retail--Wholesale: 8.04%
17 145 Federated Department FD 4.02 41.4375 6,008
Stores, Inc.
18 102 Wal-Mart Stores, Inc. WMT 4.02 58.8750 6,005
Utilities: 9.71%
19 164 MCI Worldcom, Inc. WCOM 9.71 88.5000 14,514
---- --------
100% $149,492
==== ========
</TABLE>
FOOTNOTES TO PORTFOLIO
(1) Contracts to purchase the Securities were entered into on November 17,
1999. All such contracts are expected to be settled on or about the First
Settlement Date of the Trust which is expected to be November 23, 1999.
(2) Based on the cost of the Securities to the Trust.
(3) Evaluation of Securities by the Trustee was made on the basis of closing
sales prices at the Evaluation Time on the day prior to the Initial Date of
Deposit. The Sponsor's Purchase Price is $149,715. The Sponsor's loss on
the Initial Date of Deposit is $223.
A-8
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE TRUSTEE AND UNITHOLDERS,
EQUITY SECURITIES TRUST, SERIES 25,
SYMPHONY SERIES, ZACKS ALL-STAR ANALYSTS TRUST V
In our opinion, the accompanying Statement of Financial Condition, including
the Portfolio, presents fairly, in all material respects, the financial
position of Equity Securities Trust, Series 25, Symphony Series, Zacks All-Star
Analysts Trust V (the "Trust") at opening of business, November 18, 1999, in
conformity with generally accepted accounting principles. This financial
statement is the responsibility of the Trust's management; our responsibility
is to express an opinion on this financial statement based on our audit. We
conducted our audit of this financial statement in accordance with generally
accepted auditing standards which require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statement is free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statement, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audit, which included confirmation of the contracts for the securities at
opening of business, November 18, 1999, by correspondence with the Sponsor,
provides a reasonable basis for the opinion expressed above.
PricewaterhouseCoopers LLP
Boston, MA
November 18, 1999
A-9
<PAGE>
Zacks All-Star Analysts Trust
INVESTING WITH WALL STREET'S TOP-RATED ANALYSTS
The All-Star Analysts Trust seeks to achieve capital appreciation by creating
a portfolio of stocks based on the current equity recommendations of the
Zacks/Wall Street All-Star Analysts.
The All-Star Analysts are selected by Zacks Investment Research, one of the
leading authorities on rating investment analysts. Zacks' exhaustive,
quantitative research analyzes tens of thousands of "buy", "hold" and "sell"
recommendations published by thousands of analysts. At the end of each year,
Zacks tallies the performance of each analyst's stock recommendations. The five
analysts in each industry whose stock picks performed the best are designated
Zacks All-Stars.
"ZACKS is the premier service for specific statistics on what the
analysts think about stocks."
--Forbes, June 3, 1996
"ZACKS Investment Research is the best known compiler of Wall Street
analysts' earnings estimates."
--Barron's, May 27, 1996
THE ALL-STAR TRUST
The All-Stars' current picks are then reviewed by the Sponsor. Only those
stocks rated as "buy" and "strong buy" by three or more of the All-Stars are
considered for inclusion into the Trust. Of course, the analysts' past
performance does not guarantee future results of their current selections or of
all the All-Star Trust.
Once the stock are selected for the Trust, they are balanced in accordance
with Standard & Poor's industry weightings to assure diversification. The
stocks will remain in the portfolio for the Trust's fifteen months life, and
will be monitored by the Sponsor for the duration. Under limited circumstances,
the stocks can be removed from the Trust. Although the portfolio is fixed, you
can redeem your units at the net asset value on any business day.
(i)
<PAGE>
INVESTING IN A NEW GENERATION OF UNIT INVESTMENT TRUSTS
The popularity of equity UITs has surged in recent years, with new issues up
totaling over $60 billion through 1998, according to the Investment Company
Institute (ICI). Investors are discovering that the buy-and-hold advantages of
fixed, professionally selected portfolios are worth learning about--and
investing in.
SELECTING THE ALL-STAR PORTFOLIO
1. The Data
The selection process begins with Zacks--the authority on tracking
investment analysts. Zacks stock recommendation database holds over 700,000
"buy", "hold" and "sell" recommendations from 2,500 analysts made during
the last ten years.
2. Determining Eligibility
It takes more than just an opinion to qualify as a Zacks All-Star analyst.
Only investment analysts who publish "buy", "hold" or "sell" opinions on at
least five stocks within an industry, (including two of the industry's ten
largest stocks) are deemed to be experts. In addition, only those analysts
who have stayed at their firms for the entire year are eligible.
3. Measuring Performance
A portfolio is created for each eligible analyst that includes only the
"buys" and "strong buys" published during the year. Each recommendation is
given equal weighting, and the portfolios are updated daily as the analysts
change their recommendations. The total return is calculated, including
dividends, for each analyst's portfolio.
4. Selecting the Best
At the end of the year, the five analysts in each industry whose portfolios
had the highest annual returns are designated Zacks All-Star Analysts.
5. The Trust
Only those stocks recommended by three or more All-Stars will be considered
for inclusion into the Trust. The stocks are then weighted and diversified
in accordance with the Standard & Poor's composite weightings.
(ii)
<PAGE>
All-Star Advantages
PROFESSIONAL SELECTION
Your portfolio will be selected by using top-rated analysts' stock picks
and will be diversified in relation to the Standard & Poor's industry
weightings.
A BUY-AND-HOLD STRATEGY
The buy-and-hold fixed portfolio eliminates management fees and reduces
trading expenses. The savings are passed through to investors. Investors
purchasing units will be charged a sales charge.
MONITORED PORTFOLIO
The stocks in your portfolio are continuously monitored, and under certain
extraordinary circumstances, can be removed from the portfolio.
DAILY PRICING/DAILY LIQUIDITY
You may redeem your units at the net asset value. The daily price will
fluctuate with the underlying securities, and may be worth more or less
than the original purchase price at redemption.
RETIREMENT PLAN QUALIFIED
The All-Star Trust can be held in IRA's and custodial accounts in addition
to your regular investment portfolio.
COMPOUND RETURNS
You have the option to automatically reinvest the semiannual distributions
(if any) back into additional units at a reduced sales charge.
THREE OPTIONS AT TERMINATION
When your Trust terminates, you have the option to A) receive your
distribution in cash, B) reinvest your proceeds into a new trust at a
reduced sales charge, or C) receive shares of the underlying stocks
(minimums apply). Options may be subject to tax liability.
Units of the Trust are not deposits or obligations of, or guarantee by, any
bank and Units are not federally insured or otherwise protected by the
Federal Deposit Insurance Corporation and involve investment risk. An
investment in Units of the Trust should be made with an understanding of
the risk associated with investment in common stocks and ADRs, which
include the risks that the financial condition of the issuers may become
impaired (including non-U.S. issuers) or that the general condition of the
stock market may worsen.
REICH & TANG DISTRIBUTORS, INC.
A Subsidiary of Nvest Companies, L.P. 600 Fifth Avenue New York, NY 10020-2302
(iii)
<PAGE>
[LOGO]
EST
EQUITY SECURITIES TRUST
SERIES 25
SYMPHONY SERIES, ZACKS ALL-STAR ANALYSTS TRUST V
PROSPECTUS PART B
PART B OF THIS PROSPECTUS MAY NOT BE
DISTRIBUTED UNLESS ACCOMPANIED BY
PART A
THE TRUST
ORGANIZATION. Equity Securities Trust, Series 25, Symphony Series, Zacks All-
Star Analysts Trust V is a "unit investment trust". The Trust was created under
the laws of the State of New York pursuant to a Trust Indenture and Agreement
(the "Trust Agreement"), dated the Initial Date of Deposit, between Reich &
Tang Distributors, Inc., as Sponsor, and The Chase Manhattan Bank, as Trustee.
On the Initial Date of Deposit, the Sponsor deposited securities with the
Trustee, including common stock, and funds and delivery statements relating to
contracts for the purchase of certain such securities (collectively, the
"Securities") with an aggregate value as set forth in Part A and cash or an
irrevocable letter of credit issued by a major commercial bank in the amount
required for such purchases. Thereafter the Trustee, in exchange for the
Securities so deposited, has registered on the registration books of the Trust
evidence of the Sponsor's ownership of all Units of the Trust. The Sponsor has
a limited right to substitute other securities in the Trust portfolio in the
event of a failed contract. See "The Trust--Substitution of Securities." The
Sponsor may also, in certain circumstances, direct the Trustee to dispose of
certain Securities if the Sponsor believes that, because of market or credit
conditions, or for certain other reasons, retention of the Security would be
detrimental to Unitholders. See "Trust Administration Portfolio--Supervision."
As of the Initial Date of Deposit, a "Unit" represents an undivided interest
or pro rata share in the Securities and cash of the Trust in the ratio of one
hundred Units for the indicated amount of the aggregate market value of the
Securities initially deposited in the Trust as is set forth in the "Summary of
Essential Information." As additional Units are issued by the Trust as a result
of the deposit of Additional Securities, as described below, the aggregate
value of the Securities in the Trust will be increased and the fractional
undivided interest in the Trust represented by each Unit will be decreased. To
the extent that any Units are redeemed by the Trustee, the fractional undivided
interest or pro rata share in such Trust represented by each unredeemed Unit
will increase, although the actual interest in such Trust represented by such
fraction will remain unchanged. Units will remain outstanding until redeemed
upon tender to the Trustee by Unitholders, which may include the Sponsor, or
until the termination of the Trust Agreement.
DEPOSIT OF ADDITIONAL SECURITIES. With the deposit of the Securities in the
Trust on the Initial Date of Deposit, the Sponsor established a proportionate
relationship among the initial aggregate value of specified Securities in the
Trust. During the 90 days subsequent to the Initial Date of Deposit (the
"Deposit Period"), the Sponsor may deposit additional Securities in the Trust
that are substantially similar to the Securities already deposited in the Trust
("Additional Securities"), contracts to purchase Additional Securities
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or cash with instructions to purchase Additional Securities, in order to create
additional Units, maintaining to the extent practicable the original
proportionate relationship of the number of shares of each Security in the
Trust portfolio on the Initial Date of Deposit. These additional Units, which
will result in an increase in the number of Units outstanding, will each
represent, to the extent practicable, an undivided interest in the same number
and type of securities of identical issuers as are represented by Units issued
on the Initial Date of Deposit. It may not be possible to maintain the exact
original proportionate relationship among the Securities deposited on the
Initial Date of Deposit because of, among other reasons, purchase requirements,
changes in prices or unavailability of Securities. The composition of the Trust
portfolio may change slightly based on certain adjustments made to reflect the
disposition of Securities and/or the receipt of a stock dividend, a stock split
or other distribution with respect to such Securities, including Securities
received in exchange for shares or the reinvestment of the proceeds distributed
to Unitholders. Deposits of Additional Securities in the Trust subsequent to
the Deposit Period must replicate exactly the existing proportionate
relationship among the number of shares of Securities in the Trust portfolio.
Substitute Securities may be acquired under specified conditions when
Securities originally deposited in the Trust are unavailable (see "The Trust--
Substitution of Securities" below).
OBJECTIVES. The primary objective of the Trust is to seek to achieve capital
appreciation. Current income is a secondary objective. The Trust seeks to
achieve its objectives by investing in a portfolio of equity securities, each
of which has been selected by three or more of the top five analysts in each of
50 major industries. These top analysts have been identified and monitored by
the Portfolio Consultant (see "The Trust--The Securities" below). As used
herein, the term "Securities" means the stocks initially deposited in the Trust
and described in "Portfolio" in Part A and any additional stocks acquired and
held by the Trust pursuant to the provisions of the Indenture. All of the
Securities in the Trust are listed on the New York Stock Exchange, the American
Stock Exchange or the National Association of Securities Dealers Automated
Quotations ("NASDAQ") National Quotation Market System.
The Trust will terminate in approximately fifteen months, at which time
investors may choose to either receive the distributions in kind (if they own
at least 2,500 Units), in cash or reinvest in a subsequent series of Equity
Securities Trust (if offered) at a reduced sales charge. The Trust is intended
to be an investment which should be held by investors for the full term of the
Trust and not be used as a trading vehicle. Since the Sponsor may deposit
additional Securities in connection with the sale of additional Units, the
yields on these Securities may change subsequent to the Initial Date of
Deposit. Further, the Securities may appreciate or depreciate in value,
dependent upon the full range of economic and market influences affecting
corporate profitability, the financial condition of issuers and the prices of
equity securities in general and the Securities in particular. Therefore, there
is no guarantee that the objectives of the Trust will be achieved.
THE SECURITIES. Each of the Securities in the Portfolio of the Trust was
recommended as "buy" and "strong buy" as of the business day prior to the
Initial Date of Deposit by three or more of the "All-Star Analysts" as
indicated by Zacks in the Zacks/Wall Street Journal All-Star Analysts Survey.
The Wall Street Journal and its publisher, Dow Jones & Company, Inc., have no
interest in the Trust, have not endorsed the Trust, and have no opinion about
the suitability of the Trust as an investment. Neither Dow Jones nor The Wall
Street Journal has participated in or will participate in the selection of
securities for the Trust. The concept of All-Star Analysts was first formulated
in 1990, when Zacks and the Wall Street Journal began tracking the returns of
stocks recommended by brokerage firms. This initial study, which is updated
quarterly by Zacks and published as part of a special section in the Wall
Street Journal, measured only the performance of the "buy list" published by
the major brokers. In 1993 this analysis was expanded and Zacks began measuring
the
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performance of the stocks recommended by each of the individual analysts
employed by the brokerage firms. Each year Zacks and the Wall Street Journal
identify the top analysts in each of 50 major industries based on the
historical performance of the stocks they recommend. Only analysts who do not
change firms during the year, who follow at least five companies in their
industry and who follow at least 2 of the 10 largest firms in their industry
are included in the competition. Equal weighted portfolios are created by Zacks
throughout the year that contain all stocks recommended by each of the analysts
as "buys" or "strong buys." Whenever a recommendation is lowered, the stock is
removed from the hypothetical portfolio and whenever a new stock is
recommended, it is added to the hypothetical portfolio which is then
rebalanced. In each industry the five analysts with the best performing
portfolio for the year are designated "All-Star Analysts" for the industry and
are published by the Wall Street Journal in the annual Zacks/Wall Street
Journal All-Star Analysts Survey.
Each stock in the portfolio of the Trust was recommended as "buy" and "strong
buy" as of the business day prior to the Initial Date of Deposit by three or
more of the 1999 All-Star Analysts. There are approximately 150 industries
represented in the S&P 500. Due to overlap among these industries, Zacks has
combined industries to create several broad industry sectors. The number of
shares of each stock in the portfolio has been set by Zacks so that the
relative market value of the stock in the portfolio is generally proportionate
to the weight of the significant sectors in the S&P 500 and within each sector
if there were more than one stock those stocks have been equally weighted in
the portfolio. Depending on the number of stocks that meet these criteria as of
the business day prior to the Initial Date of Deposit, the selection of the
stocks for the portfolio will be made from among such stocks by Zacks
Investment Management.
The Trustee has not participated and will not participate in the selection of
Securities for the Trust, and neither the Sponsor, the Portfolio Consultant nor
the Trustee will be liable in any way for any default, failure or defect in any
Securities.
The contracts to purchase Securities deposited initially in the Trust are
expected to settle in three business days, in the ordinary manner for such
Securities. Settlement of the contracts for Securities is thus expected to take
place prior to the settlement of purchase of Units on the Initial Date of
Deposit.
SUBSTITUTION OF SECURITIES. In the event of a failure to deliver any Security
that has been purchased for the Trust under a contract ("Failed Securities"),
the Sponsor is authorized under the Trust Agreement to direct the Trustee to
acquire other securities ("Substitute Securities") to make up the original
corpus of the Trust.
The Substitute Securities must be purchased within 20 days after the delivery
of the notice of the failed contract. Where the Sponsor purchases Substitute
Securities in order to replace Failed Securities, the purchase price may not
exceed the purchase price of the Failed Securities and the Substitute
Securities must be substantially similar to the Securities originally
contracted for and not delivered.
Whenever a Substitute Security has been acquired for the Trust, the Trustee
shall, within five days thereafter, notify all Unitholders of the Trust of the
acquisition of the Substitute Security and the Trustee shall, on the next
Distribution Date which is more than 30 days thereafter, make a pro rata
distribution of the amount, if any, by which the cost to the Trust of the
Failed Security exceeded the cost of the Substitute Security plus accrued
interest, if any.
In the event no substitution is made, the proceeds of the sale of Securities
will be distributed to Unitholders as set forth under "Rights of Unitholders --
Distributions." In addition, if the right of substitution shall not be utilized
to acquire Substitute Securities in the event of a failed contract, the Sponsor
will cause to be refunded the sales charge attributable to such Failed
Securities to all Unitholders, and distribute the principal and dividends, if
any, attributable to such Failed Securities on the next Distribution Date.
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<PAGE>
RISK CONSIDERATIONS
FIXED PORTFOLIO. The value of the Units will fluctuate depending on all of
the factors that have an impact on the economy and the equity markets. These
factors similarly impact the ability of an issuer to distribute dividends.
Unlike a managed investment company in which there may be frequent changes in
the portfolio of securities based upon economic, financial and market analyses,
securities of a unit investment trust, such as the Trust, are not subject to
such frequent changes based upon continuous analysis. All the Securities in the
Trust are liquidated or distributed during the Liquidation Period. Since the
Trust will not sell Securities in response to ordinary market fluctuation, and
only at the Trust's termination, the amount realized upon the sale of the
Securities may not be the highest price attained by an individual Security
during the life of the Trust. Some of the Securities in the Trust may also be
owned by other clients of the Sponsor and their affiliates. However, because
these clients may have differing investment objectives, the Sponsor may sell
certain Securities from those accounts in instances where a sale by the Trust
would be impermissible, such as to maximize return by taking advantage of
market fluctuations. Investors should consult with their own financial advisers
prior to investing in the Trust to determine its suitability. (See "Trust
Administration--Portfolio Supervision" below.)
ADDITIONAL SECURITIES. Investors should be aware that in connection with the
creation of additional Units subsequent to the Initial Date of Deposit, the
Sponsor may deposit Additional Securities, contracts to purchase Additional
Securities or cash with instructions to purchase Additional Securities, in each
instance maintaining the original proportionate relationship, subject to
adjustment under certain circumstances, of the numbers of shares of each
Security in the Trust. Subject to regulatory approval, to the extent the price
of a Security increases or decreases between the time cash is deposited with
instructions to purchase the Security and the time the cash is used to purchase
the Security, Units may represent less or more of that Security and more or
less of the other Securities in the Trust. In addition, brokerage fees (if any)
incurred in purchasing Securities with cash deposited with instructions to
purchase the Securities will be an expense of the Trust.
Price fluctuations between the time of deposit and the time the Securities
are purchased, and payment of brokerage fees, will affect the value of every
Unitholder's Units and the Income per Unit received by the Trust. In
particular, Unitholders who purchase Units during the initial offering period
would experience a dilution of their investment as a result of any brokerage
fees paid by the Trust during subsequent deposits of Additional Securities
purchased with cash deposited. In order to minimize these effects, the Trust
will try to purchase Securities as near as possible to the Evaluation Time or
at prices as close as possible to the prices used to evaluate Trust Units at
the Evaluation Time.
In addition, subsequent deposits to create such additional Units will not be
covered by the deposit of a bank letter of credit. In the event that the
Sponsor does not deliver cash in consideration for the additional Units
delivered, the Trust may be unable to satisfy its contracts to purchase the
Additional Securities without the Trustee selling underlying Securities.
Therefore, to the extent that the subsequent deposits are not covered by a bank
letter of credit, the failure of the Sponsor to deliver cash to the Trust, or
any delays in the Trust receiving such cash, would have significant adverse
consequences for the Trust.
COMMON STOCK. Since the Trust contains primarily common stocks of domestic
issuers, an investment in Units of the Trust should be made with an
understanding of the risks inherent in any investment in common stocks
including the risk that the financial condition of the issuers of the
Securities may become impaired. Additional risks include risks associated with
the right to receive payments from the issuer which is generally inferior to
the rights of creditors of, or holders of debt obligations or preferred stock
issued by the
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<PAGE>
issuer. Holders of common stocks have a right to receive dividends only when,
if, and in the amounts declared by the issuer's board of directors and to
participate in amounts available for distribution by the issuer only after all
other claims on the issuer have been paid or provided for. By contrast, holders
of preferred stocks usually have the right to receive dividends at a fixed rate
when and as declared by the issuer's board of directors, normally on a
cumulative basis. Dividends on cumulative preferred stock must be paid before
any dividends are paid on common stock and any cumulative preferred stock
dividend which has been omitted is added to future dividends payable to the
holders of such cumulative preferred stock. Preferred stocks are also usually
entitled to rights on liquidation which are senior to those of common stocks.
For these reasons, preferred stocks generally entail less risk than common
stocks.
Moreover, common stocks do not represent an obligation of the issuer and
therefore do not offer any assurance of income or provide the degree of
protection of debt securities. The issuance of debt securities or even
preferred stock by an issuer 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 economic
interest of holders of common stock with respect to assets of the issuer upon
liquidation or bankruptcy. Further, unlike debt securities which typically have
a stated principal amount payable at maturity (which value will be subject to
market fluctuations prior thereto), common stocks have neither fixed principal
amount nor a maturity and have values which are subject to market fluctuations
for as long as the common stocks remain outstanding. Common stocks are
especially susceptible to general stock market movements and to volatile
increases and decreases in 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. The value of the common stocks
in the Trust thus may be expected to fluctuate over the life of the Trust to
values higher or lower than those prevailing on the Initial Date of
Deposit.
THE COMPUTER TECHNOLOGY AND SCIENCE INDUSTRIES. Companies in the rapidly
changing fields of science and computer technology face special risks. For
example, their products or services may not prove commercially successful or
may become obsolete quickly. The value of the Trust's Units may be susceptible
to factors affecting the computer technology, technology-related and science
industries and to greater risk and market fluctuation than an investment in a
trust that invests in a broader range of portfolio securities not concentrated
in any particular industry. As such, the Trust may not be an appropriate
investment for individuals who are not long-term investors and who, as their
primary objective, require safety of principal or stable income from their
investments. The computer technology, technology-related and science industries
may be subject to greater governmental regulation than many other industries
and changes in governmental policies and the need for regulatory approvals may
have a material adverse effect on these industries. Additionally, companies in
these industries may be subject to risks of developing computer technologies,
competitive pressures and other factors and are dependent upon consumer and
business acceptance as new technologies evolve.
YEAR 2000 ISSUE. Many existing computer programs use only two digits to
identify a year in the date field and were designed and developed without
considering the impact of the upcoming change in the century. Therefore, for
example, the year "2000" would be incorrectly identified as the year "1900". If
not corrected, many computer applications could fail or create erroneous
results by or at the Year 2000, requiring substantial resources to remedy. The
Sponsor and Trustee believe that the "Year 2000" problem is material to their
business and operations and could have a material adverse effect on the
Sponsor's and the Trustee's results of operations and, in turn, cash available
for distribution by the Trustee. Although the Sponsor and the Trustee are
addressing the problem with respect to their business operations, there can be
no assurance that the Year 2000
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<PAGE>
problem will be properly or timely resolved. The Year 2000 problem may also
adversely affect issuers to varying degrees based upon various factors. The
Sponsor is unable to predict what effect, if any, the Year 2000 problem will
have on such issuers.
LEGISLATION. At any time after the Initial Date of Deposit, legislation may
be enacted, affecting the Securities in the Trust or the issuers of the
Securities. There can be no assurance that future legislation, regulation or
deregulation will not have a material adverse effect on the Trust or will not
impair the ability of the issuers of the Securities to achieve their business
goals.
LEGAL PROCEEDINGS AND LITIGATION. At any time after the Initial Date of
Deposit, legal proceedings may be initiated on various grounds, or legislation
may be enacted, with respect to the Securities in the Trust or to matters
involving the business of the issuer of the Securities. There can be no
assurance that future legal proceedings or legislation will not have a material
adverse impact on the Trust or will not impair the ability of the issuers of
the Securities to achieve their business and investment goals.
ORGANIZATION COSTS. The Securities purchased with the portion of the Public
Offering Price intended to be used to reimburse the Sponsor for the Trust's
organization costs will be purchased in the same proportionate relationship as
all the Securities contained in the Trust. Securities will be sold to reimburse
the Sponsor for the Trust's organization costs at the completion of the initial
offering period, which is expected to be 90 days from the Initial Date of
Deposit (a significantly shorter time period than the life of the Trust).
During the initial offering period, there may be a decrease in the value of the
Trust Securities. To the extent the proceeds from the sale of these Securities
are insufficient to repay the Sponsor for the Trust organization costs, the
Trustee will sell additional Securities to allow the Trust to fully reimburse
the Sponsor. In that event, the net asset value per Unit will be reduced by the
amount of additional Securities sold. Although the dollar amount of the
reimbursement due to the Sponsor will remain fixed and will never exceed $1.30
per 100 Units, this will also result in a greater effective cost per Unit to
Unitholders for the reimbursement to the Sponsor. When Securities are sold to
reimburse the Sponsor for organization costs, the Trustee will sell such
Securities to an extent which will maintain the same proportionate relationship
among the Securities contained in the Trust as existed prior to such sale.
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<PAGE>
PUBLIC OFFERING
OFFERING PRICE. The Public Offering Price of the Units for the Trust is
computed by adding the applicable initial sales charge to the aggregate value
of the Securities in the Trust (as determined by the Trustee) and any cash held
to purchase Securities, divided by the number of Units of the Trust
outstanding. The total sales charge consists of an initial sales charge and a
deferred sales charge equal, in the aggregate, to a maximum charge of 2.95% of
the Public Offering Price (3.040% of the net amount invested in Securities).
The initial sales charge is computed by deducting the deferred sales charge
($19.50 per 100 Units) from the aggregate maximum sales charge of 2.95%. The
initial sales charge on the Initial Date of Deposit is 1.00% of the Public
Offering Price.
Subsequent to the Initial Date of Deposit, the amount of the initial sales
charge will vary with changes in the aggregate value of the Securities in the
Trust. The initial sales charge is deducted from the purchase price of a Unit
at the time of purchase and paid to the Sponsor. The deferred sales charge is a
monthly charge of $1.95 per 100 Units and is accrued in ten monthly
installments commencing on March 1, 2000 and will be charged to the Principal
Account on the first day of each month thereafter through December 1, 2000. If
a Deferred Sales Charge Payment Date is not a business day, the payment will be
charged to the Trust on the next business day. To the extent the entire
deferred sales charge of $19.50 per 100 Units has not been so deducted at the
time of repurchase or redemption of units prior to February 1, 2001, any unpaid
amount will be deducted from the proceeds or in calculating an in kind
distribution. Units purchased pursuant to the Reinvestment Plan are subject
only to the remaining applicable deferred sales charge deduction (see
"Reinvestment Plan").
In calculating the Public Offering Price, the aggregate value of the
Securities is determined in good faith by the Trustee on each "Business Day" as
defined in the Indenture in the following manner: because the Securities are
listed on a national securities exchange, this evaluation is based on the
closing sale prices on that exchange as of the Evaluation Time (unless the
Trustee deems these prices inappropriate as a basis for valuation). If the
Trustee deems these prices inappropriate as a basis for evaluation, then the
Trustee may utilize, at the Trust's expense, an independent evaluation service
or services to ascertain the values of the Securities. The independent
evaluation service shall use any of the following methods, or a combination
thereof, which it deems appropriate: (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 by such other appraisal deemed appropriate by the Trustee
or (c) by any combination of the above, each as of the Evaluation Time.
VOLUME AND OTHER DISCOUNTS. Units are available at a volume discount from the
Public Offering Price during the initial public offering based upon the number
of Units purchased. This volume discount will result in a reduction of the
initial sales charge applicable to such purchases. The approximate reduced
initial sales charge on the Public Offering Price applicable to such purchases
is as follows:
<TABLE>
<CAPTION>
APPROXIMATE
REDUCED
INITIAL SALES
NUMBER OF UNITS CHARGE
--------------- -------------
<S> <C>
10,000 but less than 25,000.............. .75%
25,000 but less than 50,000.............. .50%
50,000 but less than 100,000............. .25%
</TABLE>
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<PAGE>
For transactions of 100,000 Units or more, the Sponsor intends to negotiate
the applicable sales charge and such charge will be disclosed to any such
purchaser. The Sponsor reserves the right to change the discounts from time to
time.
These discounts will apply to all purchases of Units by the same purchaser
during the initial public offering period. Units purchased by the same
purchasers in separate transactions during the initial public offering period
will be aggregated for purposes of determining if such purchaser is entitled to
a discount provided that such purchaser must own at least the required number
of Units at the time such determination is made. Units held in the name of the
spouse of the purchaser or in the name of a child of the purchaser under 21
years of age are deemed for the purposes hereof to be registered in the name of
the purchaser. The discount is also applicable to a trustee or other fiduciary
purchasing securities for a single trust estate or single fiduciary
account.
The holders of units of prior series of Equity Securities Trusts (the "Prior
Series") may "rollover" into this Trust by exchanging units of the Prior Series
for Units of the Trust at their relative net asset values, subject only to the
applicable deferred sales charge of 1.95% of the Public Offering Price. An
exchange of a Prior Series for Units of the Trust will generally be a taxable
event. The rollover option described herein will also be available to investors
in the Prior Series who elect to purchase Units of the Trust within 60 days of
their liquidation of units in the Prior Series (see "Trust Termination").
Employees (and their immediate families) of Reich & Tang Distributors, Inc.
(and its affiliates), the Portfolio Consultant and of the special counsel to
the Sponsor, may, pursuant to employee benefit arrangements, purchase Units of
the Trust at a price equal to the aggregate value of the underlying securities
in the Trust during the initial offering period, divided by the number of Units
outstanding (without a sales charge). Such arrangements result in less selling
effort and selling expenses than sales to employee groups of other companies.
Resales or transfers of Units purchased under the employee benefit arrangements
may only be made through the Sponsor's secondary market, so long as it is being
maintained, and not through other broker-dealers.
Investors in any open-end management investment company or unit investment
trust that have purchased their investment within a five-year period prior to
the date of this Prospectus can purchase Units of the Trust in an amount not
greater in value than the amount of said investment made during this five-year
period subject only to the applicable deferred sales charge of 1.95% of the
Public Offering Price.
Units may be purchased in the primary or secondary market (including
purchases by Rollover Unitholders) at the Public Offering Price (for purchases
which do not qualify for a volume discount) less the concession the Sponsor
typically allows to brokers and dealers for purchases (see "Public Offering--
Distribution of Units") by (1) investors who purchase Units through registered
investment advisers, certified financial planners and registered broker-dealers
who in each case either charge periodic fees for financial planning, investment
advisory or asset management service, or provide such services in connection
with the establishment of an investment account for which a comprehensive "wrap
fee" charge is imposed, (2) bank trust departments investing funds over which
they exercise exclusive discretionary investment authority and that are held in
a fiduciary, agency, custodial or similar capacity, (3) any person who, for at
least 90 days, has been an officer, director or bona fide employee of any firm
offering Units for sale to investors or their immediate family members (as
described above) and (4) officers and directors of bank holding companies that
make Units available directly or through subsidiaries or bank affiliates.
Notwithstanding anything to the contrary in this
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<PAGE>
Prospectus, such investors, bank trust departments, firm employees and bank
holding company officers and directors who purchase Units through this program
will not receive the volume discount.
DISTRIBUTION OF UNITS. During the initial offering period and thereafter to
the extent additional Units continue to be offered by means of this Prospectus,
Units will be distributed by the Sponsor and dealers at the Public Offering
Price. The initial offering period is thirty days after each deposit of
Securities in the Trust and the Sponsor may extend the initial offering period
for successive thirty day periods. Certain banks and thrifts will make Units of
the Trust available to their customers on an agency basis. A portion of the
sales charge paid by their customers is retained by or remitted to the banks.
Under the Glass-Steagall Act, banks are prohibited from underwriting Units;
however, the Glass-Steagall Act does permit certain agency transactions and the
banking regulators have indicated that these particular agency transactions are
permitted under such Act. On November 16, 1999, President Clinton signed the
Gramm-Leach-Bliley Act, repealing certain provisions of the Glass-Steagall Act
which have restricted affiliation between banks and securities firms and
amending the Bank Holding Company Act thereby removing restrictions on banks
and insurance companies. The new legislation grants banks new authority to
conduct certain authorized activity though financial subsidiaries. In addition,
state securities laws on this issue may differ from the interpretations of
federal law expressed herein and banks and financial institutions may be
required to register as dealers pursuant to state law.
The Sponsor intends to qualify the Units for sale in substantially all States
through dealers who are members of the National Association of Securities
Dealers, Inc. Units may be sold to dealers at prices which represent a
concession of up to [4.0%] per Unit, subject to the Sponsor's right to change
the dealers' concession from time to time. Such Units may then be distributed
to the public by the dealers at the Public Offering Price then in effect. The
Sponsor reserves the right to reject, in whole or in part, any order for the
purchase of Units.
Broker-dealers of the Trust, banks and/or others are eligible to participate
in a program in which such firms receive from the Sponsor a nominal award for
each of their registered representatives who have sold a minimum number of
units of unit investment trusts created by the Sponsor during a specified time
period. In addition, at various times the Sponsor may implement other programs
under which the sales forces of brokers, dealers, banks and/or others may be
eligible to win other nominal awards for certain sales efforts or under which
the Sponsor will allow to any such brokers, dealers, banks and/or others that
sponsor sales contests or recognition programs conforming to criteria
established by the Sponsor, or participate in sales programs sponsored by the
Sponsor, an amount not exceeding the total applicable sales charges on the
sales generated by such person at the public offering price during such
programs. Also, the Sponsor in its discretion may from time to time pursuant to
objective criteria established by the Sponsor pay fees to qualifying brokers,
dealers, banks and/or others for certain services or activities which are
primarily intended to result in sales of Units of the Trust. Such payments are
made by the Sponsor out of its own assets and not out of the assets of the
Trust. These programs will not change the price Unitholders pay for their Units
or the amount that the Trust will receive from the Units sold.
SPONSOR'S PROFITS. The Sponsor will receive a combined gross underwriting
commission equal to the initial sales charge of 1.00% of the Public Offering
Price and the monthly Deferred Sales Charge of $1.95 per 100 units.
Additionally, the Sponsor may realize a profit on the deposit of the Securities
in the Trust representing the difference between the cost of the Securities to
the Sponsor and the cost of the Securities to the Trust (See "Portfolio"). The
Sponsor may realize profits or sustain losses with respect to Securities
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deposited in the Trust which were acquired from underwriting syndicates of
which they were a member. All or a portion of the Securities initially
deposited in the Trust may have been acquired through the Sponsor.
During the initial offering period and thereafter to the extent additional
Units continue to be offered by means of this Prospectus, the Underwriter may
also realize profits or sustain losses as a result of fluctuations after the
Initial Date of Deposit in the aggregate value of the Securities and hence in
the Public Offering Price received by the Sponsor for the Units. Cash, if any,
made available to the Sponsor prior to settlement date for the purchase of
Units may be used in the Sponsor's business subject to the limitations of 17
CFR 240.15c3-3 under the Securities Exchange Act of 1934 and may be of benefit
to the Sponsor.
Both upon acquisition of Securities and termination of the Trust, the Trustee
may utilize the services of the Sponsor for the purchase or sale of all or a
portion of the Securities in the Trust. The Sponsor may receive brokerage
commissions from the Trust in connection with such purchases and sales in
accordance with applicable law.
In maintaining a market for the Units (see "Sponsor Repurchase") the Sponsor
will realize profits or sustain losses in the amount of any difference between
the price at which it buys Units and the price at which it resells such
Units.
RIGHTS OF UNITHOLDERS
OWNERSHIP OF UNITS. Ownership of Units of the Trust will not be evidenced by
certificates. All evidence of ownership of the Units will be recorded in book-
entry form at the Depository Trust Company ("DTC") through an investor's
brokerage account. Units held through DTC will be deposited by the Sponsor with
DTC in the Sponsor's DTC account and registered in the nominee name CEDE &
COMPANY. Individual purchases of beneficial ownership interest in the Trust may
be made in book-entry form through DTC. Ownership and transfer of Units will be
evidenced and accomplished directly and indirectly by book-entries made by DTC
and its participants. DTC will record ownership and transfer Units among DTC
participants and forward all notices and credit all payments received in
respect of the Units held by the DTC participants. Beneficial owners of Units
will receive written confirmation of their purchases and sales from the broker-
dealer or bank from whom their purchase was made. Units are transferable by
making a written request property accompanied by a written instrument or
instruments of transfer which should be sent registered or certified mail for
the protection of the Unitholder. Holders must sign such written request
exactly as their names appear on the records of the Trust. Such signatures must
be guaranteed by a commercial bank or trust company, savings and loan
association or by a member firm of a national securities exchange.
DISTRIBUTIONS. Dividends received by the Trust are credited by the Trustee to
an Income Account for the Trust. Other receipts, including the proceeds of
Securities disposed of, are credited to a Principal Account for the Trust.
Distributions to each Unitholder from the Income Account are computed as of
the close of business on each Record Date for the following payment date and
consist of an amount substantially equal to such Unitholder's pro rata share of
the income credited to the Income Account, less expenses. Distributions from
the Principal Account of the Trust (other than amounts representing failed
contracts, as previously discussed) will be computed as of each Record Date,
and will be made to the Unitholders of the Trust on or shortly after the
Distribution Date. Proceeds representing principal received from the
disposition of any of the Securities
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between a Record Date and a Distribution Date which are not used for
redemptions of Units will be held in the Principal Account and not distributed
until the next Distribution Date. Persons who purchase Units between a Record
Date and a Distribution Date will receive their first distribution on the
Distribution Date after such purchase.
As of each Record Date, the Trustee will deduct from the Income Account of
the Trust, and, to the extent funds are not sufficient therein, from the
Principal Account of the Trust, amounts necessary to pay the expenses of the
Trust (as determined on the basis set forth under "Trust Expenses and
Charges"). The Trustee also may withdraw from said accounts such amounts, if
any, as it deems necessary to establish a reserve for any applicable taxes or
other governmental charges that may be payable out of the Trust. Amounts so
withdrawn shall not be considered a part of such Trust's assets until such time
as the Trustee shall return all or any part of such amounts to the appropriate
accounts. In addition, the Trustee may withdraw from the Income and Principal
Accounts such amounts as may be necessary to cover redemptions of Units by the
Trustee.
Distributions of amounts necessary to pay the Deferred Sales Charge will be
made from the Principal Account to an account maintained by the Trustee for
purposes of satisfying investors' sales charge obligations. Proceeds of the
disposition of any Securities not used to pay the Deferred Sales Charge or to
redeem Units will be held in the Principal Account and distributed on the final
distribution upon termination of the Trust.
The dividend distribution per 100 Units, if any, cannot be anticipated and
may be paid as Securities are redeemed, exchanged or sold, or as expenses of
the Trust fluctuate. No distribution need be made from the Income Account or
the Principal Account until the balance therein is an amount sufficient to
distribute $1.00 per 100 Units.
RECORDS. The Trustee shall furnish Unitholders in connection with each
distribution a statement of the amount of dividends and interest, if any, and
the amount of other receipts, if any, which are being distributed, expressed in
each case as a dollar amount per 100 Units. Within a reasonable time after the
end of each calendar year, the Trustee will furnish to each person who at any
time during the calendar year was a Unitholder of record, a statement showing
(a) as to the Income Account: dividends, interest and other cash amounts
received, amounts paid for purchases of Substitute Securities and redemptions
of Units, if any, deductions for applicable taxes and fees and expenses of the
Trust, and the balance remaining after such distributions and deductions,
expressed both as a total dollar amount and as a dollar amount representing the
pro rata share of each 100 Units outstanding on the last business day of such
calendar year; (b) as to the Principal Account: the dates of disposition of any
Securities and the net proceeds received therefrom, deductions for payments of
applicable taxes and fees and expenses of the Trust, amounts paid for purchases
of Substitute Securities and redemptions of Units, if any, and the balance
remaining after such distributions and deductions, expressed both as a total
dollar amount and as a dollar amount representing the pro rata share of each
100 Units outstanding on the last business day of such calendar year; (c) a
list of the Securities held, a list of Securities purchased, sold or otherwise
disposed of during the calendar year and the number of Units outstanding on the
last business day of such calendar year; (d) the Redemption Price per 100 Units
based upon the last computation thereof made during such calendar year; and (e)
amounts actually distributed to Unitholders during such calendar year from the
Income and Principal Accounts, separately stated, of the Trust, expressed both
as total dollar amounts and as dollar amounts representing the pro rata share
of each 100 Units outstanding on the last business day of such calendar
year.
The Trustee shall keep available for inspection by Unitholders at all
reasonable times during usual business hours, books of record and account of
its transactions as Trustee, including records of the names and addresses of
Unitholders, a current list of Securities in the portfolio and a copy of the
Trust Agreement.
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LIQUIDITY
SPONSOR REPURCHASE. Unitholders who wish to dispose of their Units should
inquire of the Sponsor as to current market prices prior to making a tender for
redemption. The aggregate value of the Securities will be determined by the
Trustee on a daily basis and computed on the basis set forth under "Trustee
Redemption." The Sponsor does not guarantee the enforceability, marketability
or price of any Securities in the Portfolio or of the Units. The Sponsor may
discontinue the repurchase of Units if the supply of Units exceeds demand, or
for other business reasons. The date of repurchase is deemed to be the date on
which redemption requests are received in proper form by Reich & Tang
Distributors, Inc., 600 Fifth Avenue, New York, New York 10020. Redemption
requests received after 4 P.M., New York Time, will be deemed to have been
repurchased on the next business day. In the event a market is not maintained
for the Units, a Unitholder may be able to dispose of Units only by tendering
them to the Trustee for redemption.
Units purchased by the Sponsor in the secondary market may be reoffered for
sale by the Sponsor at a price based on the aggregate value of the Securities
in the Trust plus an initial sales charge of 1.00% and the monthly Deferred
Sales Charge of $1.95 per 100 Units plus a pro rata portion of amounts, if any,
in the Income Account. Any Units that are purchased by the Sponsor in the
secondary market also may be redeemed by the Sponsor if it determines such
redemption to be in its best interest.
The Sponsor may, under certain circumstances, as a service to Unitholders,
elect to purchase any Units tendered to the Trustee for redemption (see
"Trustee Redemption"). Factors which the Sponsor will consider in making a
determination will include the number of Units of all Trusts which it has in
inventory, its estimate of the salability and the time required to sell such
Units and general market conditions. For example, if in order to meet
redemptions of Units the Trustee must dispose of Securities, and if such
disposition cannot be made by the redemption date (three calendar days after
tender), the Sponsor may elect to purchase such Units. Such purchase shall be
made by payment to the Unitholder not later than the close of business on the
redemption date of an amount equal to the Redemption Price on the date of
tender.
TRUSTEE REDEMPTION. At any time prior to the Evaluation Time on the business
day preceding the commencement of the Liquidation Period (approximately seven
years from the Initial Date of Deposit), Units may also be tendered to the
Trustee for redemption upon payment of any relevant tax by contacting the
Sponsor, broker, dealer or financial institution holding such Units in street
name. In certain instances, additional documents may be required, such as trust
instrument, certificate of corporate authority, certificate of death or
appointment as executor, administrator or guardian. At the present time there
are no specific taxes related to the redemption of Units. No redemption fee
will be charged by the Sponsor or the Trustee. Units redeemed by the Trustee
will be canceled.
Within three business days following a tender for redemption, the Unitholder
will be entitled to receive an amount for each Unit tendered equal to the
Redemption Price per Unit computed as of the Evaluation Time on the date of
tender. The "date of tender" is deemed to be the date on which Units are
received by the Trustee, except that with respect to Units received after the
close of trading on the New York Stock Exchange (4:00 p.m. Eastern Time), the
date of tender is the next day on which such Exchange is open for trading, and
such Units will be deemed to have been tendered to the Trustee on such day for
redemption at the Redemption Price computed on that day.
A Unitholder will receive his redemption proceeds in cash and amounts paid on
redemption shall be withdrawn from the Income Account, or, if the balance
therein is insufficient, from the Principal Account. All
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other amounts paid on redemption shall be withdrawn from the Principal Account.
The Trustee is empowered to sell Securities in order to make funds available
for redemptions. Such sales, if required, could result in a sale of Securities
by the Trustee at a loss. To the extent Securities are sold, the size and
diversity of the Trust will be reduced. The Securities to be sold will be
selected by the Trustee in order to maintain, to the extent practicable, the
proportionate relationship among the number of shares of each Security.
Provision is made in the Indenture under which the Sponsor may, but need not,
specify minimum amounts in which blocks of Securities are to be sold in order
to obtain the best price for the Trust. While these minimum amounts may vary
from time to time in accordance with market conditions, the Sponsor believes
that the minimum amounts which would be specified would be approximately 100
shares for readily marketable Securities.
The Redemption Price per Unit is the pro rata share of the Unit in the Trust
determined by the Trustee on the basis of (i) the cash on hand in the Trust or
moneys in the process of being collected, (ii) the value of the Securities in
the Trust as determined by the Trustee, less (a) amounts representing taxes or
other governmental charges payable out of the Trust, (b) the accrued expenses
of the Trust and (c) cash allocated for the distribution to Unitholders of
record as of the business day prior to the evaluation being made. As of the
close of the initial offering period the Redemption Price per 100 Units will be
reduced to reflect the payment of the per 100 Unit organization costs to the
Sponsor. Therefore, the amount of the Redemption Price per 100 Units received
by a Unitholder will include the portion representing organization costs only
when such Units are tendered for redemption prior to the close of the initial
offering period. Because the Securities are listed on a national securities
exchange, the Trustee may determine the value of the Securities in the Trust
based on the closing sale prices on that exchange. Unless the Trustee deems
these prices inappropriate as a basis for evaluation or if there is no such
closing purchase price, then the Trustee may utilize, at the Trust's expense,
an independent evaluation service or services to ascertain the values of the
Securities. The independent evaluation service shall use any of the following
methods, or a combination thereof, which it deems appropriate: (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.
Any Unitholder tendering 2,500 Units or more of the Trust for redemption may
request by written notice submitted at the time of tender from the Trustee in
lieu of a cash redemption a distribution of shares of Securities and cash in an
amount and value equal to the Redemption Price Per Unit as determined as of the
evaluation next following tender. To the extent possible, in kind distributions
("In Kind Distributions") shall be made by the Trustee through the distribution
of each of the Securities in book-entry form to the account of the Unitholder's
bank or broker-dealer at The Depository Trust Company. An In Kind Distribution
will be reduced by customary transfer and registration charges. The tendering
Unitholder will receive his pro rata number of whole shares of each of the
Securities comprising the Trust portfolio and cash from the Principal Accounts
equal to the balance of the Redemption Price to which the tendering Unitholder
is entitled. If funds in the Principal Account are insufficient to cover the
required cash distribution to the tendering Unitholder, the Trustee may sell
Securities in the manner described above.
The Trustee is irrevocably authorized in its discretion, if the Sponsor does
not elect to purchase a Unit tendered for redemption or if the Sponsor tenders
a Unit for redemption, in lieu of redeeming such Unit, to sell such Unit in the
over-the-counter market for the account of the tendering Unitholder at prices
which will return to the Unitholder an amount in cash, net after deducting
brokerage commissions, transfer taxes and other charges, equal to or in excess
of the Redemption Price for such Unit. The Trustee will pay the net proceeds of
any such sale to the Unitholder on the day he would otherwise be entitled to
receive payment of the Redemption Price.
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The Trustee reserves the right to suspend the right of redemption and to
postpone the date of payment of the Redemption Price per Unit for any period
during which the New York Stock Exchange is closed, other than customary
weekend and holiday closings, or trading on that Exchange is restricted or
during which (as determined by the Securities and Exchange Commission) an
emergency exists as a result of which disposal or evaluation of the Securities
is not reasonably practicable, or for such other periods as the Securities and
Exchange Commission may by order permit. The Trustee and the Sponsor are not
liable to any person or in any way for any loss or damage which may result from
any such suspension or postponement.
A Unitholder who wishes to dispose of his Units should inquire of his bank or
broker in order to determine if there is a current secondary market price in
excess of the Redemption Price.
TRUST ADMINISTRATION
PORTFOLIO SUPERVISION. The Trust is a unit investment trust and is not a
managed fund. Traditional methods of investment management for a managed fund
typically involve frequent changes in a portfolio of securities on the basis of
economic, financial and market analyses. The Portfolio of the Trust, however,
will not be managed and therefore the adverse financial condition of an issuer
will not necessarily require the sale of its Securities from the portfolio. It
is unlikely that the Trust will sell any of the Securities other than to
satisfy redemptions of Units, or to cease buying Additional Securities in
connection with the issuance of additional Units. However, the Trust Agreement
provides that the Sponsor may direct the disposition of Securities upon the
occurrence of certain events including: (1) default in payment of amounts due
on any of the Securities; (2) institution of certain legal proceedings; (3)
default under certain documents materially and adversely affecting future
declaration or payment of amounts due or expected; (4) determination of the
Sponsor that the tax treatment of the Trust as a grantor trust would otherwise
be jeopardized; or (5) decline in price as a direct result of serious adverse
credit factors affecting the issuer of a Security which, in the opinion of the
Sponsor, would make the retention of the Security detrimental to the Trust or
the Unitholders.
In addition, the Trust Agreement provides as follows:
(a) If a default in the payment of amounts due on any Security occurs
pursuant to provision (1) above and if the Sponsor fails to give
immediate instructions to sell or hold that Security, the Trustee,
within 30 days of that failure by the Sponsor, shall sell the
Security.
(b) It is the responsibility of the Sponsor to instruct the Trustee to
reject any offer made by an issuer of any of the Securities to issue
new securities in exchange and substitution for any Security pursuant
to a recapitalization or reorganization. If any exchange or
substitution is effected notwithstanding such rejection, any securities
or other property received shall be promptly sold unless the Sponsor
directs that it be retained.
(c) Any property received by the Trustee after the Initial Date of Deposit
as a distribution on any of the Securities in a form other than cash or
additional shares of the Securities, shall be promptly sold unless the
Sponsor directs that it be retained by the Trustee. The proceeds of any
disposition shall be credited to the Income or Principal Account of the
Trust.
(d) The Sponsor is authorized to increase the size and number of Units of
the Trust by the deposit of Additional Securities, contracts to
purchase Additional Securities or cash or a letter of credit with
instructions to purchase Additional Securities in exchange for the
corresponding number of additional Units from time to time subsequent
to the Initial Date of Deposit, provided that the original
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proportionate relationship among the number of shares of each Security
established on the Initial Date of Deposit is maintained to the extent
practicable. The Sponsor may specify the minimum numbers in which
Additional Securities will be deposited or purchased. If a deposit is
not sufficient to acquire minimum amounts of each Security, Additional
Securities may be acquired in the order of the Security most under-
represented immediately before the deposit when compared to the original
proportionate relationship. If Securities of an issue originally
deposited are unavailable at the time of the subsequent deposit, the
Sponsor may (i) deposit cash or a letter of credit with instructions to
purchase the Security when it becomes available, or (ii) deposit (or
instruct the Trustee to purchase) either Securities of one or more other
issues originally deposited or a Substitute Security.
TRUST AGREEMENT AND AMENDMENT. The Trust Agreement may be amended by the
Trustee and the Sponsor without the consent of Unitholders: (1) to cure any
ambiguity or to correct or supplement any provision which may be defective or
inconsistent; (2) to change any provision thereof as may be required by the
Securities and Exchange Commission or any successor governmental agency; or
(3) to make such other provisions in regard to matters arising thereunder as
shall not adversely affect the interests of the Unitholders.
The Trust Agreement may also be amended in any respect, or performance of
any of the provisions thereof may be waived, with the consent of investors
holding 66 2/3% of the Units then outstanding for the purpose of modifying the
rights of Unitholders; provided that no such amendment or waiver shall reduce
any Unitholder's interest in the Trust without his consent or reduce the
percentage of Units required to consent to any such amendment or waiver
without the consent of the holders of all Units. The Trust Agreement may not
be amended, without the consent of the holders of all Units in the Trust then
outstanding, to increase the number of Units issuable or to permit the
acquisition of any Securities in addition to or in substitution for those
initially deposited in such Trust, except in accordance with the provisions of
the Trust Agreement. The Trustee shall promptly notify Unitholders, in
writing, of the substance of any such amendment.
TRUST TERMINATION. The Trust Agreement provides that the Trust shall
terminate as of the Evaluation Time on the business day preceding the
Liquidation Period or upon the earlier maturity, redemption or other
disposition, as the case may be, of the last of the Securities held in such
Trust and in no event is it to continue beyond the Mandatory Termination Date.
If the value of the Trust shall be less than the minimum amount set forth
under "Summary of Essential Information" in Part A, the Trustee may, in its
discretion, and shall, when so directed by the Sponsor, terminate the Trust.
The Trust may also be terminated at any time with the consent of the investors
holding 100% of the Units then outstanding. The Trustee may utilize the
services of the Sponsor for the sale of all or a portion of the Securities in
the Trust, and in so doing, the Sponsor will determine the manner, timing and
execution of the sales of the underlying Securities. Any brokerage commissions
received by the Sponsor from the Trust in connection with such sales will be
in accordance with applicable law. In the event of termination, written notice
thereof will be sent by the Trustee to all Unitholders. Such notice will
provide Unitholders with the following three options by which to receive their
pro rata share of the net asset value of the Trust and requires their election
of one of the three options by notifying the Trustee by returning a properly
completed election request (to be supplied to Unitholders of at least 2,500
Units prior to the commencement of the Liquidation Period) (see Part A--
"Summary of Essential Information" for the date of the commencement of the
Liquidation Period):
1. A Unitholder who owns at least 2,500 Units and whose interest in the
Trust would entitle it to receive at least one share of each underlying
Security will have its Units redeemed on commencement of the Liquidation
Period by distribution of the Unitholder's pro rata share of the net
asset value of the Trust on such date distributed in kind to the extent
represented by whole shares of underlying Securities
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and the balance in cash within three business days next following the
commencement of the Liquidation Period. Unitholders subsequently selling
such distributed Securities will incur brokerage costs when disposing of
such Securities. Unitholders should consult their own tax adviser in
this regard;
2. to receive in cash such Unitholder's pro rata share of the net asset
value of the Trust derived from the sale by the Sponsor as the agent of
the Trustee of the underlying Securities during the Liquidation Period.
The Unitholder's pro rata share of its net assets of the Trust will be
distributed to such Unitholder within three days of the settlement of
the trade of the last Security to be sold; or
3. to invest such Unitholder's pro rata share of the net assets of the
Trust derived from the sale by the Sponsor as agent of the Trustee of
the underlying Securities during the Liquidation Period, in units of a
subsequent series of Equity Securities Trust (the "New Series"),
provided one is offered. It is expected that a special redemption and
liquidation will be made of all Units of this Trust held by a Unitholder
(a "Rollover Unitholder") who affirmatively notifies the Trustee on or
prior to the Rollover Notification Date set forth in the "Summary of
Essential Information" for the Trust in Part A. The Units of a New
Series will be purchased by the Unitholder within three business days of
the settlement of the trade for the last Security to be sold. Such
purchaser will be entitled to a reduced sales charge upon the purchase
of units of the New Series. It is expected that the terms of the New
Series will be substantially the same as the terms of the Trust
described in this Prospectus, and that similar options with respect to
the termination of such New Series will be available. The availability
of this option does not constitute a solicitation of an offer to
purchase Units of a New Series or any other security. A Unitholder's
election to participate in this option will be treated as an indication
of interest only. At any time prior to the purchase by the Unitholder of
units of a New Series such Unitholder may change his investment strategy
and receive, in cash, the proceeds of the sale of the Securities. An
election of this option will not prevent the Unitholder from recognizing
taxable gain or loss (except in the case of a loss, if and to the extent
the New Series is treated as substantially identical to the Trust) as a
result of the liquidation, even though no cash will be distributed to
pay any taxes. Unitholders should consult their own tax advisers in this
regard.
Unitholders who do not make any election will be deemed to have elected to
receive the termination distribution in cash (option number 2).
The Sponsor has agreed that to the extent they effect the sales of underlying
securities for the Trustee in the case of the second and third options during
the Liquidation Period such sales will be free of brokerage commissions. The
Sponsor, on behalf of the Trustee, will sell, unless prevented by unusual and
unforeseen circumstances, such as, among other reasons, a suspension in trading
of a Security, the close of a stock exchange, outbreak of hostilities and
collapse of the economy, by the last business day of the Liquidation Period.
The Redemption Price per 100 Units, upon the settlement of the last sale of
Securities during the Liquidation Period, will be distributed to Unitholders in
redemption of such Unitholders' interest in the Trust.
Depending on the amount of proceeds to be invested in Units of the New Series
and the amount of other orders for Units in the New Series, the Sponsor may
purchase a large amount of securities for the New Series in a short period of
time. The Sponsor's buying of securities may tend to raise the market prices of
these securities. The actual market impact of the Sponsor's purchases, however,
is currently unpredictable because the actual amount of securities to be
purchased and the supply and price of those securities is unknown. A similar
problem may occur in connection with the sale of Securities during the
Liquidation Period; depending
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on the number of sales required, the prices of and demand for Securities, such
sales may tend to depress the market prices and thus reduce the proceeds of
such sales. The Sponsor believes that the sale of underlying Securities over
the Liquidation Period as described above is in the best interest of a
Unitholder and may mitigate the negative market price consequences stemming
from the trading of large amounts of Securities. The Securities may be sold in
fewer than five days if, in the Sponsor's judgment, such sales are in the best
interest of Unitholders. The Sponsor, in implementing such sales of securities
on behalf of the Trustee, will seek to maximize the sales proceeds and will act
in the best interests of the Unitholders. There can be no assurance, however,
that any adverse price consequences of heavy trading will be mitigated.
The Sponsor may for any reason, in its sole discretion, decide not to sponsor
any subsequent series of the Trust, without penalty or incurring liability to
any Unitholder. If the Sponsor so decides, the Sponsor will notify the Trustee
of that decision, and the Trustee will notify the Unitholders. All Unitholders
will then elect either option 1, if eligible, or option 2.
By electing to "rollover" into the New Series, the Unitholder indicates his
interest in having his terminating distribution from the Trust invested only in
the New Series created following termination of the Trust; the Sponsor expects,
however, that a similar rollover program will be offered with respect to all
subsequent series of the Trust, thus giving Unitholders an opportunity to elect
to roll their terminating distributions into a New Series. The availability of
the rollover privilege does not constitute a solicitation of offers to purchase
units of a New Series or any other security. A Unitholder's election to
participate in the rollover program will be treated as an indication of
interest only. The Sponsor intends to coordinate the date of deposit of a
future series so that the terminating trust will terminate contemporaneously
with the creation of a New Series. The Sponsor reserves the right to modify,
suspend or terminate the rollover privilege at any time.
THE SPONSOR. The Sponsor, Reich & Tang Distributors, Inc., a Delaware
corporation, is engaged in the brokerage business and is a member of the
National Association of Securities Dealers, Inc. Reich & Tang is also a
registered investment advisor. Reich & Tang maintains its principal business
offices at 600 Fifth Avenue, New York, New York 10020. The sole shareholder of
the Sponsor, Reich & Tang Asset Management, Inc. ("RTAM Inc.") is wholly owned
by NEIC Holdings, Inc. which, effective December 29, 1997, was wholly owned by
NEIC Operating Partnership, L.P. ("NEICOP"). Subsequently, on March 31, 1998,
NEICOP changed its name to Nvest Companies, L.P. ("Nvest"). The general
partners of Nvest are Nvest Corporation and Nvest L.P. As of March 31, 1998,
Metropolitan Life Insurance Company ("MetLife") owned approximately 47% of the
partnership interests of Nvest. Nvest, with a principal place of business at
399 Boylston Street, Boston, MA 02116, is a holding company of firms engaged in
the securities and investment advisory business. These affiliates in the
aggregate are investment advisors or managers to over 80 registered investment
companies. Reich & Tang is Sponsor for numerous series of unit investment
trusts, including New York High Yield Trust, Series 1 (and Subsequent Series),
High Yield Securities Trust, Series 1 (and Subsequent Series), 1st Discount
Series (and Subsequent Series), Multi-State Series 1 (and Subsequent Series),
Mortgage Securities Trust, Series 1 (and Subsequent Series), Insured High Yield
Securities Trust, Series 1 (and Subsequent Series) and 5th Discount Series (and
Subsequent Series), Equity Securities Trust, Series 1, Signature Series,
Gabelli Communications Income Trust (and Subsequent Series), Schwab Trusts and
McLaughlin, Piven, Vogel Family of Trusts.
The information included herein is only for the purpose of informing
investors as to the financial responsibility of the Sponsor and its ability to
carry out its contractual obligations. The Sponsor will be under no liability
to Unitholders for taking any action, or refraining from taking any action, in
good faith pursuant to
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the Trust Agreement, or for errors in judgment except in cases of its own
willful misfeasance, bad faith, gross negligence or reckless disregard of its
obligations and duties.
The Sponsor may resign at any time by delivering to the Trustee an instrument
of resignation executed by the Sponsor. If at any time the Sponsor shall resign
or fail to perform any of its duties under the Trust Agreement or becomes
incapable of acting or becomes bankrupt or its affairs are taken over by public
authorities, then the Trustee may either (a) appoint a successor Sponsor; (b)
terminate the Trust Agreement and liquidate the Trust; or (c) continue to act
as Trustee without terminating the Trust Agreement. Any successor Sponsor
appointed by the Trustee shall be satisfactory to the Trustee and, at the time
of appointment, shall have a net worth of at least $1,000,000.
THE TRUSTEE. The Trustee is The Chase Manhattan Bank with its principal
executive office located at 270 Park Avenue, New York, New York 10017 (800)
428-8890 and its unit investment trust office at Four New York Plaza, New York,
New York 10004. The Trustee is subject to supervision by the Superintendent of
Banks of the State of New York, the Federal Deposit Insurance Corporation and
the Board of Governors of the Federal Reserve System.
The Trustee shall not be liable or responsible in any way for taking any
action, or for refraining from taking any action, in good faith pursuant to the
Trust Agreement, or for errors in judgment; or for any disposition of any
moneys, Securities or Units in accordance with the Trust Agreement, except in
cases of its own willful misfeasance, bad faith, gross negligence or reckless
disregard of its obligations and duties; provided, however, that the Trustee
shall not in any event be liable or responsible for any evaluation made by any
independent evaluation service employed by it. In addition, the Trustee shall
not be liable for any taxes or other governmental charges imposed upon or in
respect of the Securities or the Trust which it may be required to pay under
current or future law of the United States or any other taxing authority having
jurisdiction. The Trustee shall not be liable for depreciation or loss incurred
by reason of the sale by the Trustee of any of the Securities pursuant to the
Trust Agreement.
For further information relating to the responsibilities of the Trustee under
the Trust Agreement, reference is made to the material set forth under "Rights
of Unitholders."
The Trustee may resign by executing an instrument in writing and filing the
same with the Sponsor, and mailing a copy of a notice of resignation to all
Unitholders. In such an event the Sponsor is obligated to appoint a successor
Trustee as soon as possible. In addition, if the Trustee becomes incapable of
acting or becomes bankrupt or its affairs are taken over by public authorities,
the Sponsor may remove the Trustee and appoint a successor as provided in the
Trust Agreement. Notice of such removal and appointment shall be mailed to each
Unitholder by the Sponsor. If upon resignation of the Trustee no successor has
been appointed and has accepted the appointment within thirty days after
notification, the retiring Trustee may apply to a court of competent
jurisdiction for the appointment of a successor. The resignation or removal of
the Trustee becomes effective only when the successor Trustee accepts its
appointment as such or when a court of competent jurisdiction appoints a
successor Trustee. Upon execution of a written acceptance of such appointment
by such successor Trustee, all the rights, powers, duties and obligations of
the original Trustee shall vest in the successor.
Any corporation into which the Trustee may be merged or with which it may be
consolidated, or any corporation resulting from any merger or consolidation to
which the Trustee shall be a party, shall be the
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successor Trustee. The Trustee must always be a banking corporation organized
under the laws of the United States or any State and have at all times an
aggregate capital, surplus and undivided profits of not less than
$2,500,000.
THE PORTFOLIO CONSULTANT. The Portfolio Consultant is Zacks Investment
Research Inc., an Illinois corporation, with offices at 155 North Wacker Drive,
Chicago, Illinois 60606. Zacks is a 200 person consulting firm that summarizes,
interprets, organizes, evaluates and distributes research produced by the 3000
analysts employed by 230 United States brokerage firms. This price driving flow
of information has been tracked by Zacks since 1980 and is delivered, on a
daily basis, to retail brokers at the Zacks Web site, www.reswizard.com, and is
delivered, on a weekly basis, to individual investors at the Zacks Web site,
www.zacks.com.
Zacks Investment Management, a wholly owned subsidiary of Zacks, is a
registered investment advisor, with $330 million under management in hedge
funds.
The Portfolio Consultant is not a sponsor of the Trust. The Portfolio
Consultant has been retained by the Sponsor, at its expense. The Portfolio
Consultant's only responsibility with respect to the Trust, in addition to its
role in Portfolio selection, is to monitor the Securities of the Portfolio and
make recommendations to the Sponsor regarding the disposition of the Securities
held by the Trust. The responsibility of monitoring the Securities of the
Portfolio means that if the Portfolio Consultant's view materially changes
regarding the appropriateness of an investment in any Security then held in the
Trust based upon the investment objectives, guidelines, terms, parameters,
policies and restrictions supplied to the Portfolio Consultant by the Sponsor,
the Portfolio Consultant will notify the Sponsor of such change to the extent
consistent with applicable legal requirements. The Sponsor is not obligated to
adhere to the recommendations of the Portfolio Consultant regarding the
disposition of Securities. The Sponsor has the sole authority to direct the
Trust to dispose of Securities under the Trust Agreement. The Portfolio
Consultant has no other responsibilities or obligations to the Trust or the
Unitholders.
The Portfolio Consultant may resign or may be removed by the Sponsor at any
time on sixty days' prior written notice. The Sponsor shall use its best
efforts to appoint a satisfactory successor in the event that the
Portfolio Consultant resigns or is removed. Such resignation or removal shall
become effective upon the acceptance of appointment by the successor Portfolio
Consultant. If upon resignation of the Portfolio Consultant no successor has
accepted appointment within sixty days after notice of resignation, the Sponsor
has agreed to perform this function.
EVALUATION OF THE TRUST. The value of the Securities in the Trust portfolio
is determined in good faith by the Trustee on the basis set forth under "Public
Offering--Offering Price." The Sponsor and the Unitholders may rely on any
evaluation furnished by the Trustee and shall have no responsibility for the
accuracy thereof. Determinations by the Trustee under the Trust Agreement shall
be made in good faith upon the basis of the best information available to it,
provided, however, that the Trustee shall be under no liability to the Sponsor
or Unitholders for errors in judgment, except in cases of its own willful
misfeasance, bad faith, gross negligence or reckless disregard of its
obligations and duties. The Trustee, the Sponsor and the Unitholders may rely
on any evaluation furnished to the Trustee by an independent evaluation service
and shall have no responsibility for the accuracy thereof.
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TRUST EXPENSES AND CHARGES
Investors will reimburse the Sponsor on a per 100 Units basis, for all or a
portion of the estimated costs incurred in organizing the Trust, including the
cost of the initial preparation, printing and execution of the registration
statement and the indenture, Federal and State registration fees, the initial
fees and expenses of the Trustee, legal expenses and any other out-of-pocket
costs. The estimated organization costs will be paid from the assets of the
Trust as of the close of the initial public offering period. To the extent that
actual organization costs are less than the estimated amount, only the actual
organization costs will be deducted form the assets of the Trust. To the extent
that actual organization costs are greater than the estimated amount, only the
estimated organization costs included in the Public Offering Price will be
reimbursed to the Sponsor. Any balance of the costs incurred in establishing
the Trust, as well as advertising and selling costs, will be paid by the
Sponsor at no cost to the Trust.
The Sponsor will receive for portfolio supervisory services to the Trust an
Annual Fee in the amount set forth under "Summary of Essential Information" in
Part A. The Sponsor's fee may exceed the actual cost of providing portfolio
supervisory services for the Trust, but at no time will the total amount
received for portfolio supervisory services rendered to all series of the
Equity Securities Trust in any calendar year exceed the aggregate cost to the
Sponsor of supplying such services in such year. (See "Portfolio
Supervision.")
The Trustee will receive, for its ordinary recurring services to the Trust,
an annual fee in the amount set forth under "Summary of Essential Information"
in Part A. For a discussion of the services performed by the Trustee pursuant
to its obligations under the Trust Agreement, see "Trust Administration" and
"Rights of Unitholders."
The Trustee's fees applicable to a Trust are payable as of each Record Date
from the Income Account of the Trust to the extent funds are available and then
from the Principal Account. Both fees may be increased without approval of the
Unitholders by amounts not exceeding proportionate increases in consumer prices
for services as measured by the United States Department of Labor's Consumer
Price Index entitled "All Services Less Rent." Payment of the Deferred Sales
Charge will be made in the manner described under Rights of Unitholders--
Distributions.
The following additional charges are or may be incurred by the Trust: all
expenses (including counsel fees) of the Trustee incurred and advances made in
connection with its activities under the Trust Agreement, including the
expenses and costs of any action undertaken by the Trustee to protect the Trust
and the rights and interests of the Unitholders; fees of the Trustee for any
extraordinary services performed under the Trust Agreement; indemnification of
the Trustee for any loss or liability accruing to it without gross negligence,
bad faith or willful misconduct on its part, arising out of or in connection
with its acceptance or administration of the Trust; indemnification of the
Sponsor for any losses, liabilities and expenses incurred in acting as sponsors
of the Trust without gross negligence, bad faith or willful misconduct on its
part; and all taxes and other governmental charges imposed upon the Securities
or any part of the Trust (no such taxes or charges are being levied, made or,
to the knowledge of the Sponsor, contemplated). The above expenses, including
the Trustee's fees, when paid by or owing to the Trustee are secured by a first
lien on the Trust to which such expenses are charged. In addition, the Trustee
is empowered to sell the Securities in order to make funds available to pay all
expenses.
Unless the Sponsor otherwise directs, the accounts of the Trust shall be
audited not less than annually by independent public accountants selected by
the Sponsor. The expenses of the audit shall be an expense of the
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Trust. So long as the Sponsor maintains a secondary market, the Sponsor will
bear any audit expense which exceeds $.50 Cents per 100 Units. Unitholders
covered by the audit during the year may receive a copy of the audited
financial statements upon request.
REINVESTMENT PLAN
Income and principal distributions on Units (other than the final
distribution in connection with the termination of the Trust) may be reinvested
by participating in the Trust's reinvestment plan. Under the plan, the Units
acquired for participants will be either Units already held in inventory by the
Sponsor or new Units created by the Sponsor's deposit of Additional Securities
as described in "The Trust-Organization" in this Part B. Units acquired by
reinvestment will be subject only to the remaining monthly deductions of the
deferred sales charge. Investors should inform their broker, dealer or
financial institution when purchasing their Units if they wish to participate
in the reinvestment plan. Thereafter, Unitholders should contact their broker,
dealer or financial institution if they wish to modify or terminate their
election to participate in the reinvestment plan. In order to enable a
Unitholder to participate in the reinvestment plan with respect to a particular
distribution on their Units, such notice must be made at least three business
days prior to the Record Day for such distribution. Each subsequent
distribution of income or principal on the participant's Units will be
automatically applied by the Trustee to purchase additional Units of the Trust.
The Sponsor reserves the right to modify or terminate the reinvestment plan at
any time without prior notice. The reinvestment plan for the Trust may not be
available in all states.
EXCHANGE PRIVILEGE AND CONVERSION OFFER
Unitholders will be able to elect to exchange any or all of their Units of
this Trust for Units of one or more of any available series of Equity
Securities Trust, Insured Municipal Securities Trust, Municipal Securities
Trust, New York Municipal Trust or Mortgage Securities Trust (the "Exchange
Trusts") subject only to the remaining deferred sales charge as set forth in
the prospectus of the Exchange Trust (the "Exchange Privilege"). Unit owners of
any registered unit investment trust for which there is no active secondary
market in the units of such trust (a "Redemption Trust") will be able to elect
to redeem such units and apply the proceeds of the redemption to the purchase
of available Units of one or more series of an Exchange Trust (the "Conversion
Trusts") at the Public Offering Price for units of the Conversion Trust subject
only to the remaining deferred sales charge as set forth in the prospectus of
the Conversion Trust (the "Conversion Offer"). Under the Exchange Privilege,
the Sponsor's repurchase price during the initial offering period of the Units
being surrendered will be based on the market value of the Securities in the
Trust portfolio or on the aggregate offer price of the Bonds in the other Trust
Portfolios; and, after the initial offering period has been completed, will be
based on the aggregate bid price of the securities in the particular Trust
portfolio. Under the Conversion Offer, units of the Redemption Trust must be
tendered to the trustee of such trust for redemption at the redemption price
determined as set forth in the relevant Redemption Trust's prospectus. Units in
an Exchange or Conversion Trust will be sold to the Unitholder at a price based
on the aggregate offer price of the securities in the Exchange or Conversion
Trust portfolio (or for units of Equity Securities Trust, based on the market
value of the underlying securities in the trust portfolio) during the initial
public offering period of the Exchange or Conversion Trust; and after the
initial public offering period has been completed, based on the aggregate bid
price of the securities in the Exchange or Conversion Trust Portfolio if its
initial offering has been completed plus accrued interest (or for units of
Equity Securities Trust, based on the market value of the underlying securities
in the trust portfolio) and a reduced sales charge.
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Except for Unitholders who wish to exercise the Exchange Privilege or
Conversion Offer within the first five months of their purchase of Units of the
Exchange or Redemption Trust, any purchaser who purchases Units under the
Exchange Privilege or Conversion Offer will pay a lower sales charge than that
which would be paid for the Units by a new investor. For Unitholders who wish
to exercise the Exchange Privilege or Conversion Offer within the first five
months of their purchase of Units of the Exchange or Redemption Trust, the
sales charge applicable to the purchase of units of an Exchange or Conversion
Trust shall be the greater of (i) the reduced sales charge or (ii) an amount
which when coupled with the sales charge paid by the Unitholder upon his
original purchase of Units of the Exchange or Redemption Trust would equal the
sales charge applicable in the direct purchase of units of an Exchange or
Conversion Trust.
In order to exercise the Exchange Privilege the Sponsor must be maintaining a
secondary market in the units of the available Exchange Trust. The Conversion
Offer is limited only to unit owners of any Redemption Trust. Exercise of the
Exchange Privilege and the Conversion Offer by Unitholders is subject to the
following additional conditions (i) at the time of the Unitholder's election to
participate in the Exchange Privilege or the Conversion Offer, there must be
units of the Exchange or Conversion Trust available for sale, either under the
initial primary distribution or in the Sponsor's secondary market, (iii)
exchanges will be effected in whole units only, (iv) Units of the Mortgage
Securities Trust may only be acquired in blocks of 1,000 Units and (v) Units of
the Equity Securities Trust may only be acquired in blocks of 100 Units.
Unitholders will not be permitted to advance any funds in excess of their
redemption in order to complete the exchange. Any excess proceeds received from
a Unitholder for exchange, or from units being redeemed for conversion, will be
remitted to such Unitholder.
The Sponsor reserves the right to suspend, modify or terminate the Exchange
Privilege and/or the Conversion Offer. The Sponsor will provide Unitholders of
the Trust with 60 days' prior written notice of any termination or material
amendment to the Exchange Privilege or the Conversion Offer, provided that, no
notice need be given if (i) the only material effect of an amendment is to
reduce or eliminate the sales charge payable at the time of the exchange, to
add one or more series of the Trust eligible for the Exchange Privilege or the
Conversion Offer, to add any new unit investment trust sponsored by Reich &
Tang or a sponsor controlled by or under common control with Reich & Tang, or
to delete a series which has been terminated from eligibility for the Exchange
Privilege or the Conversion Offer, (ii) there is a suspension of the redemption
of units of an Exchange or Conversion Trust under Section 22(e) of the
Investment Company Act of 1940, or (iii) an Exchange Trust temporarily delays
or ceases the sale of its units because it is unable to invest amounts
effectively in accordance with its investment objectives, policies and
restrictions. During the 60-day notice period prior to the termination or
material amendment of the Exchange Privilege described above, the Sponsor will
continue to maintain a secondary market in the units of all Exchange Trusts
that could be acquired by the affected Unitholders. Unitholders may, during
this 60-day period, exercise the Exchange Privilege in accordance with its
terms then in effect.
To exercise the Exchange Privilege, a Unitholder should notify the Sponsor of
his desire to exercise his Exchange Privilege. To exercise the Conversion
Offer, a unit owner of a Redemption Trust should notify his retail broker of
his desire to redeem his Redemption Trust Units and use the proceeds from the
redemption to purchase Units of one or more of the Conversion Trusts. If Units
of a designated, outstanding series of an Exchange or Conversion Trust are at
the time available for sale and such Units may lawfully be sold in the state in
which the Unitholder is a resident, the Unitholder will be provided with a
current prospectus or prospectuses relating to each Exchange or Conversion
Trust in which he indicates an interest. He may then select the Trust or Trusts
into which he desires to invest the proceeds from his sale of Units. The
exchange
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transaction will operate in a manner essentially identical to a secondary
market transaction except that units may be purchased at a reduced sales
charge. The conversion transaction will be handled entirely through the unit
owner's retail broker. The retail broker must tender the units to the trustee
of the Redemption Trust for redemption and then apply the proceeds to the
redemption toward the purchase of units of a Conversion Trust at a price based
on the aggregate offer or bid side evaluation per Unit of the Conversion Trust,
depending on which price is applicable, plus accrued interest and the
applicable sales charge. The certificates must be surrendered to the broker at
the time the redemption order is placed and the broker must specify to the
Sponsor that the purchase of Conversion Trust Units is being made pursuant to
the Conversion Offer. The unit owner's broker will be entitled to retain a
portion of the sales charge.
TAX CONSEQUENCES OF THE EXCHANGE PRIVILEGE AND THE CONVERSION OFFER. A
surrender of Units pursuant to the Exchange Privilege or the Conversion Offer
will constitute a "taxable event" to the Unitholder under the Internal Revenue
Code. The Unitholder will realize a tax gain or loss that will be of a long- or
short-term capital or ordinary income nature depending on the length of time
the units have been held and other factors. (See "Tax Status".) A Unitholder's
tax basis in the Units acquired pursuant to the Exchange Privilege or
Conversion Offer will be equal to the purchase price of such Units. Investors
should consult their own tax advisors as to the tax consequences to them of
exchanging or redeeming units and participating in the Exchange Privilege or
Conversion Offer.
TAX STATUS
This is a general discussion of some of the Federal income tax consequences
of the purchase, ownership and disposition of Units in the Trust by U.S.
citizens and residents and corporations organized in the United States. It
applies only to investors who hold their Units as capital assets. It does not
discuss special rules that apply to investors subject to special tax treatment,
such as securities dealers, financial institutions and insurance companies.
OPINION OF COUNSEL. In the opinion of Battle Fowler LLP:
1. The IRS will classify the Trust as a grantor trust for Federal income
tax purposes. The Trust will not owe Federal income tax. Each Unitholder
will be treated as the owner of a pro rata portion of the assets of the
Trust. The income received by the Trust will be treated as income of the
Unitholders.
2. The Trust will not be subject to the New York Franchise Tax on
Business Corporations or the New York City General Corporation Tax.
However, Unitholders who are New York residents must treat their pro rata
portion of the income of the Trust as their income under New York State and
City income tax laws. Residents of other states may have to do the same
thing in their states.
3. The Sponsor has the right to create additional Units for 90 days after
the original issuance date by depositing Additional Securities in the
Trust. The Additional Securities must be substantially similar to the
securities initially deposited in the Trust. The IRS will treat the Trust
as a grantor trust even though the Sponsor has this power.
Battle Fowler LLP is special counsel to the Sponsor. Its opinion is based on
existing law. Battle Fowler LLP has relied on the validity of the Trust
Agreement and the Prospectus and on the accuracy and completeness of the facts
they contain.
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TAXATION OF UNITHOLDERS. The IRS will tax each Unitholder the same way it
would if the Unitholder owned directly its pro rata share of the securities
held by the Trust. A Unitholder will be taxed on its share of income or gain
received by the Trust even if that income or gain is used to pay a deferred
sales charge.
A taxable event will generally occur with respect to each Unitholder when the
Trust disposes of a Security (whether by sale, exchange or redemption) or upon
the sale, exchange or redemption of Units by the Unitholder. The price a
Unitholder pays for its Units, including sales charges, is allocated among its
pro rata portion of each Security held by the Trust (in proportion to the fair
market values thereof on the date the Unitholder purchases its Units) in order
to determine its initial cost for its pro rata portion of each Security held by
the Trust. These same allocation rules apply to the deferred sales charge. See
"Fractional Undivided Interest in Trust" in the "Summary of Essential
Information" in order to determine a Unitholder's share of each security on the
date of Deposit, and see "Cost of Securities to Trust" under "Portfolio" in
order to determine the fair market value of each security on that date.
For Federal income tax purposes, a Unitholder's pro rata portion of dividends
paid with respect to a Security held by the Trust is taxable as ordinary income
to the extent of the issuer's current or accumulated earnings and profits. A
Unitholder's pro rata portion of dividends paid on a Security that exceed
current and accumulated earnings and profits will first reduce a Unitholder's
tax basis in the Security, and to the extent that such dividends exceed a
Unitholder's tax basis in the Security will generally be treated as a capital
gain.
A Unitholder's portion of gain, if any, upon the sale, exchange or redemption
of Units or the disposition of Securities held by the Trust will generally be
considered a capital gain and will be long-term if the Unitholder has held its
Units (and the Trust has held the Securities) for more than one year. Capital
gains realized by corporations are generally taxed at the same rates applicable
to ordinary income, but non-corporate taxpayers who realize long-term capital
gains may be subject to a reduced tax rate of 20%, rather than the regular
maximum tax rate of 39.6%. Tax rates may increase prior to the time when
Unitholders may realize gains from the sale, exchange or redemption of the
Units or Securities.
A Unitholder's portion of loss, if any, upon the sale or redemption of Units
or the disposition of Securities held by the Trust will generally be considered
a capital loss and will be long-term if the Unitholder has held its Units (and
the Trust has held the Securities) for more than one year. Capital losses are
deductible to the extent of capital gains; in addition, up to $3,000 of capital
losses ($1,500 for married individuals filing separately) recognized by non-
corporation Unitholders may be deduced against ordinary income.
Unitholders will not be able to deduct losses resulting from the sale of
shares or the sale of Units if (and to the extent that) the Unitholder
purchases other securities or other Units within 30 days before or after the
sale. This rule could also apply to a transaction in which a Unitholder sells
Units or the Trust sells Securities, and the Unitholder purchases shares of
those same Securities directly within the 60 day period. If this disallowance
rule applies, the basis of the newly purchased Units and securities will be
adjusted to reflect the disallowed loss.
A Unitholder that itemizes its deductions may also deduct its pro rata share
of the fees and expenses of the Trust, but only to the extent that such
amounts, together with the Unitholder's other miscellaneous deductions, exceed
2% of its adjusted gross income. The deduction of fees and expenses may also be
limited by Section 68 of the Code, which reduces the amount of itemized
deductions that are allowed for individuals with incomes in excess of certain
thresholds.
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After the end of each calendar year, the Trustee will furnish to each
Unitholder an annual statement containing information relating to the dividends
received by the Trust on the Securities, the gross proceeds received by the
Trust from the disposition of any Security, and the fees and expenses paid by
the Trusts. The Trustee will also furnish annual information returns to each
Unitholder and to the Internal Revenue Service.
A corporation that owns Units will generally be entitled to a 70% dividends
received deduction with respect to its pro rata portion of any dividends
taxable as ordinary income received by the Trust from a domestic corporation or
from a qualifying foreign corporation in the same manner as if such corporation
directly owned the Securities paying such dividends. However, a corporation
owning Units should be aware that Sections 246 and 246A of the Code impose
additional limitations on the eligibility of dividends for the 70% dividends
received deduction. These limitations include a requirement that stock (and
therefore Units) must generally be held at least 46 days (as determined under
Section 246(c) of the Code) during the 90-day period beginning on the date that
is 45 days before the date on which the stock becomes ex-dividend. Moreover,
the allowable percentage of the deduction will be reduced if a corporation
Unitholder owns stock (or Units) the financing of which is directly
attributable to indebtedness incurred by such corporation.
As discussed in the section "Administration of the Trust--Trust Termination,"
each Unitholder may have three options in receiving its termination
distributions, namely (i) to receive its pro rata share of the underlying
Securities in kind, (ii) to receive cash upon liquidation of its pro rata share
of the underlying Securities, or (iii) to invest the amount of cash it will
receive upon the liquidation of its pro rata share of the underlying Securities
in units of a future series of the Trust (if one is offered) at a reduced sales
charge. A Unitholder that chooses option (i) should be treated as merely
exchanging its undivided pro rata ownership of Securities held by the Trust for
sole ownership of a proportionate share of Securities, and therefore the
transaction should be tax free to the extent the Securities are received.
Alternatively, the transaction may be treated as an exchange that will qualify
for nonrecognition treatment to the extent the Unitholder is exchanging its
undivided interest in all of the Trust's Securities for its proportionate
number of shares of the underlying Securities. In either instance, the
transaction should result in a non-taxable event for the Unitholder to the
extent Securities are received.
The Trust generally must withhold and pay over to the U.S. Treasury 31% of
the taxable dividends and other distributions paid to any individual Unitholder
who either does not supply its taxpayer identification number, has not reported
all of its dividends and interest income, or does not certify to the Trust that
he or she is not subject to withholding. The social security number of an
individual is its taxpayer identification number.
TAX-EXEMPT ENTITIES. Entities that generally qualify for an exemption from
Federal income tax, such as many pension trusts, are nevertheless taxed under
Section 511 of the Code on "unrelated business taxable income." Unrelated
business taxable income is income from a trade or business regularly carried on
by the tax-exempt entity that is unrelated to the entity's exempt purpose.
Unrelated business taxable income generally does not include dividend or
interest income or gain from the sale of investment property, unless such
income is derived from property that is debt-financed or is dealer property. A
tax-exempt entity's dividend income from the Trust and gain from the sale of
Units in the Trust or from the Trust's sale of Securities is not expected to
constitute unrelated business taxable income to such tax-exempt entity unless
the acquisition of the Unit itself is debt-financed or constitutes dealer
property in the hands of the tax-exempt entity.
Before investing in the Trust, the trustee or investment manager of an
employee benefit plan (e.g., a pension or profit-sharing retirement plan)
should consider among other things (a) whether the investment is prudent under
the Employee Retirement Income Security Act of 1974 ("ERISA"), taking into
account the
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needs of the plan and all of the facts and circumstances of the investment in
the Trust, including the fact that the Trust is intended to generate tax exempt
income; (b) whether the investment satisfies the diversification requirement of
Section 404(a)(1)(C) of ERISA; and (c) whether the assets of the Trust are
deemed "plan assets" under ERISA and the Department of Labor regulations
regarding the definition of "plan assets."
Prospective investors are urged to consult their own tax advisers concerning
the Federal, state, local and any other tax consequences of the purchase,
ownership and disposition of Units prior to investing in the Trust.
OTHER MATTERS
LEGAL OPINIONS. The legality of the Units offered hereby and certain matters
relating to Federal tax law have been passed upon by Battle Fowler LLP, 75 East
55th Street, New York, New York 10022 as counsel for the Sponsor. Carter,
Ledyard & Milburn, Two Wall Street, New York, New York 10005 have acted as
counsel for the Trustee.
INDEPENDENT AUDITORS. The Statement of Financial Condition, including the
Portfolio, are included herein in reliance upon the report of
PricewaterhouseCoopers LLP, independent auditors, and upon the authority of
said firm as experts in accounting and auditing.
PERFORMANCE INFORMATION. Total returns, average annualized returns or
cumulative returns for various periods of the stocks receiving "buy" or "strong
buy" recommendations of at least three of the All Star Analysts monitored by
the Portfolio Consultant ("All-Star Analysts Recommendations") and this Trust
may be included from time to time in advertisements, sales literature and
reports to current or prospective investors. Total return shows changes in Unit
price during the period plus any dividends and capital gains, divided by the
maximum public offering price as of the date of calculation. Average annualized
returns show the average return for stated periods of longer than a year. Sales
material may also include an illustration of the cumulative results of like
annual investments in the All-Star Analysts Recommendations during an
accumulation period and like annual withdrawals during a distribution period.
Figures for actual portfolios will reflect all applicable expenses and, unless
otherwise stated, the maximum sales charge. No provision is made for any income
taxes payable. Similar figures may be given for the Trust. Trust performance
may be compared to performance on a total return basis of the NASDAQ, NYSE or
similar exchanges, as well as the DJIA, S&P 500 Index or other similar indices.
In addition, total return comparisons may be made to performance data from
Lipper Analytical Services, Inc., Morningstar Publications, Inc., Standard &
Poor's CompuStat and Center for Research in Security Prices (CRSP) at the
University of Chicago or from publications such as The Wall Street Journal,
Money, The New York Times, U.S. News and World Report, Business Week, Forbes or
Fortune. As with other performance data, performance comparisons should not be
considered representative of the Trust's relative performance for any future
period.
Pending the approval of the National Association of Securities Dealers
Regulation, the Sponsor may also include, in advertisements, sales literature
and reports to current or prospective investors, the performance of
hypothetical portfolios to which the Sponsor has applied the same investment
objectives and selection strategies, as well as back-tested data of the
historical performance of such strategies, as described in "The Trust--The
Securities" and which the Sponsor intends to apply to the selection of
securities for the Trust. This performance information is intended to
illustrate each of the Trust's strategies and should not be interpreted as
indicative of the future performance of the Trust.
SEC WEBSITE. The Securities and Exchange Commission ("SEC") maintains a
website that contains reports, proxy and information statements and other
information regarding the Trusts which is filed
B-26
<PAGE>
electronically with the SEC. The SEC's Internet address is http:www.sec.gov.
Offering materials for the sale of these Units available through the Internet
are not being offered directly or indirectly to residents of a particular state
nor is an offer of these Units through the Internet specifically directed to
any person in a state by, or on behalf of, the issuer.
Prospective tax-exempt investors are urged to consult their own tax advisers
concerning the Federal, state, local and any other tax consequences of the
purchase, ownership and disposition of Units prior to investing in the
Trust.
B-27
<PAGE>
No person is authorized to give any information or to make any
representations with respect to this Trust not contained in Parts A and B of
this Prospectus and you should not rely on any other information. The Trust is
registered as a unit investment trust under the Investment Company Act of
1940. Such registration does not imply that the Trust or any of its Units have
been guaranteed, sponsored, recommended or approved by the United States or
any state or any agency or officer thereof.
---------------
This Prospectus does not constitute an offer to sell, or a solicitation of
an offer to buy, securities in any state to any person to whom it is not
lawful to make such offer in such state.
Table of Contents
<TABLE>
<CAPTION>
Title Page
- ----- ----
<S> <C>
PART A
Fee Table.................................................................. A-5
Summary of Essential Information........................................... A-6
Statement of Financial Condition........................................... A-7
Portfolio.................................................................. A-8
Report of Independent Accountants.......................................... A-9
PART B
The Trust.................................................................. B-1
Risk Considerations........................................................ B-4
Public Offering............................................................ B-7
Rights of Unitholders...................................................... B-10
Liquidity.................................................................. B-12
Trust Administration....................................................... B-14
Trust Expenses and Charges................................................. B-20
Reinvestment Plan.......................................................... B-21
Exchange Privilege and Conversion Offer.................................... B-21
Tax Status................................................................. B-23
Other Matters.............................................................. B-26
</TABLE>
[LOGO OF EQUITY SECURITIES TRUST]
EQUITY SECURITIES TRUST
SERIES 25
SYMPHONY SERIES, ZACKS ALL-STAR ANALYSTS TRUST V
(A UNIT INVESTMENT TRUST)
PROSPECTUS
DATED: NOVEMBER 18, 1999
SPONSOR:
REICH & TANG DISTRIBUTORS, INC.
600 Fifth Avenue
New York, New York 10020
212-830-5400
TRUSTEE:
THE CHASE MANHATTAN BANK
4 New York Plaza
New York, New York 10004
This Prospectus does not contain all of the information with respect to the
Trust set forth in its registration statements filed with the Securities and
Exchange Commission, Washington, D.C. under the Securities Act of 1933 (file
no. 333-90875) and the Investment Company Act of 1940 (file no. 811-2868), and
to which reference is hereby made. Copies may be reviewed at the Commission or
on the internet, or obtained from the Commission at prescribed rates by:
.calling: 1-800-SEC-0330
. visiting the SEC internet address: http://www.sec.gov
. writing: Public Reference Section of the Commission, 450 Fifth Street,
N.W., Washington, D.C. 20549-6009
<PAGE>
PART II ADDITIONAL INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM A--BONDING ARRANGEMENTS
The employees of Reich & Tang Distributors, Inc. are covered under Brokers'
Blanket Policy, Standard Form 14, in the amount of $11,000,000 (plus
$196,000,000 excess coverage under Brokers' Blanket Policies, Standard Form 14
and Form B Consolidated). This policy has an aggregate annual coverage of $15
million.
ITEM B--CONTENTS OF REGISTRATION STATEMENT
This Registration Statement on Form S-6 comprises the following papers and
documents:
The facing sheet on Form S-6.
The Cross-Reference Sheet (incorporated by reference to the Cross-
Reference Sheet to the Registration Statement of Equity Securities
Trust, Series 12, 1997 Triple Strategy Trust II).
The Prospectus consisting of pages.
Undertakings.
Signatures.
Written consents of the following persons:
Battle Fowler LLP (included in Exhibit 3.1)
PricewaterhouseCoopers LLP
Portfolio Consultant
The following exhibits:
<TABLE>
<CAPTION>
<C> <C> <S>
*99.1.1 -- Reference Trust Agreement including certain amendments to the
Trust Indenture and Agreement referred to under Exhibit
99.1.1.1 below.
99.1.1.1 -- Form of Trust Indenture and Agreement (filed as Exhibit 1.1.1
to Amendment No. 1 to Form S-6 Registration Statement No. 33-
62627 of Equity Securities Trust, Series 6, Signature Series,
Gabelli Entertainment and Media Trust on November 16, 1995
and incorporate herein by reference).
99.1.3.5 -- Certificate of Incorporation of Reich & Tang Distributors,
Inc. (filed as Exhibit 99.1.3.5 to Form S-6 Registration
Statement No. 333-44301 on January 15, 1998 and incorporated
herein by reference).
99.1.3.6 -- By-Laws of Reich & Tang Distributors, Inc. (filed as Exhibit
99.1.3.6 to Form S-6 Registration Statement No. 333-44301 on
January 15, 1998 and incorporated herein by reference).
*99.3.1 -- Opinion of Battle Fowler LLP as to the legality of the
securities being registered, including their consent to the
filing thereof and to the use of their name under the
headings "Tax Status" and "Legal Opinions" in the Prospectus,
and to the filing of their opinion regarding tax status of
the Trust.
99.6.0 -- Power of Attorney of Reich & Tang Distributors, Inc., the
Depositor, by its officers and a majority of its Directors
(filed as Exhibit 99.6.0 to Form S-6 Registration Statement
No. 333-44301 on January 15, 1998 and incorporated herein by
reference).
</TABLE>
- --------
* Filed herewith.
II-1
<PAGE>
UNDERTAKING TO FILE REPORTS
Subject to the terms and conditions of Section 15(d) of the Securities
Exchange Act of 1934, the undersigned registrant hereby undertakes to file with
the Securities and Exchange Commission such supplementary and periodic
information, documents, and reports as may be prescribed by any rule or
regulation of the Commission heretofore or hereafter duly adopted pursuant to
authority conferred in that section.
SIGNATURES
The Registrant hereby identifies Equity Securities Trust, Series 13,
Signature Series, Zacks Wall Street All-Star Analysts Trust for the purposes of
the representations required by Rule 487 and represents the following:
(1) That the portfolio securities deposited in the Series as to the
securities of which this registration statement is being filed do not
differ materially in type or quality from those deposited in such previous
series;
(2) That, except to the extent necessary to identify the specific
portfolio securities deposited in, and to provide essential financial
information for, the Series with respect to the securities of which this
registration statement is being filed, this registration statement does not
contain disclosures that differ in any material respect from those
contained in the registration statements for such previous Series as to
which the effective date was determined by the commission or the staff;
and
(3) That it has complied with Rule 460 under the Securities Act of
1933.
Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Equity Securities Trust, Series 25, Symphony Series, Zacks All-Star Analysts
Trust V, has duly caused this Amendment to the Registration Statement to be
signed on its behalf by the undersigned, hereunto duly authorized, in the City
of New York and State of New York on the 18th day of November, 1999.
EQUITY SECURITIES TRUST, SERIES 25, SYMPHONY
SERIES, ZACKS ALL-STAR ANALYSTS TRUST V
(Registrant)
REICH & TANG DISTRIBUTORS, INC.
(Depositor)
By /s/ Peter J. Demarco
__________________________________________
Peter J. DeMarco
(Authorized Signator)
Pursuant to the requirements of the Securities Act of 1933, this Amendment to
the Registration Statement has been signed below by the following persons, who
constitute the principal officers and a majority of the directors of Reich &
Tang Distributors, Inc., the Depositor, in the capacities and on the dates
indicated.
<TABLE>
<CAPTION>
Name Title Date
---- ----- ----
<C> <S> <C>
Richard E. Smith, III President and Director
Peter S. Voss Director November 18, 1999
G. Neal Ryland Director
Steven W. Duff Director
/s/ Peter J. DeMarco
Peter J. DeMarco Executive Vice PresidentBy _____________________
Richard I. Weiner Vice President Peter J. DeMarco
Bernadette N. Finn Vice President Attorney-In-Fact*
Lorraine C. Hysler Secretary
Richard De Sanctis Treasurer
Edward N. Wadsworth Executive Officer
</TABLE>
- --------
* Executed copies of Powers of Attorney were filed as Exhibit 99.6.0 to Form S-
6 to Registration Statement No. 333-44301 on January 15, 1998 and
incorporated herein by reference.
II-2
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the use in the Prospectus constituting part of this
registration statement on Form S-6 (the "Registration Statement") of our report
dated November 18, 1999, relating to the Statement of Financial Condition,
including the Portfolio, of Equity Securities Trust, Series 25, Symphony
Series, Zacks All-Star Analysts Trust V which appears in such Prospectus. We
also consent to the reference to us under the heading "Independent Accountants"
in such Prospectus.
PricewaterhouseCoopers LLP
Boston, MA
November 18, 1999
II-3
<PAGE>
CONSENT OF PORTFOLIO CONSULTANT
The Sponsor, Trustee and Unitholders
Equity Securities Trust, Series 25, Symphony Series, Zacks All-Star Analysts
Trust V
We hereby consent to the use of our name "Zacks" included herein and to the
reference to our firm in the Prospectus.
Zacks Investment Research Inc.
Chicago, Illinois
November 17, 1999
II-4
<PAGE>
EXHIBIT 99.1.1
EQUITY SECURITIES TRUST,
SERIES 25, SYMPHONY SERIES,
ZACKS ALL-STAR ANALYSTS TRUST V
REFERENCE TRUST AGREEMENT
This Reference Trust Agreement (the "Agreement") dated November 18,
1999 between Reich & Tang Distributors, Inc., as Depositor and The Chase
Manhattan Bank, as Trustee, sets forth certain provisions in full and
incorporates other provisions by reference to the document entitled "Equity
Securities Trust, Series 6, Signature Series, Gabelli Entertainment and Media
Trust, and Subsequent Series, Trust Indenture and Agreement" dated November 16,
1995 and as amended in part by this Agreement (collectively, such documents
hereinafter called the "Indenture and Agreement"). This Agreement and the
Indenture, as incorporated by reference herein, will constitute a single
instrument.
WITNESSETH THAT:
WHEREAS, this Agreement is a Reference Trust Agreement as defined in
Sec tion 1.1 of the Indenture, and shall be amended and modified from time to
time by an Addendum as defined in Section 1.1 (1) of the Indenture, such
Addendum setting forth any Additional Securities as defined in Section 1.1 (2)
of the Indenture;
WHEREAS, the Depositor wishes to deposit Securities, and any
Additional Securities as listed on any Addendums hereto, into the Trust and
issue Units, and Additional Units as the case maybe, in respect thereof pursuant
to Sections 2.1 and 2.6 of the Indenture; and
NOW THEREFORE, in consideration of the premises and of the mutual
agreements herein contained, the Depositor and the Trustee agree as follows:
Part I
STANDARD TERMS AND CONDITIONS OF TRUST
Section 1. Subject to the provisions of Part II hereof, all the
provisions contained in the Indenture are herein incorporated by reference in
their entirety and shall be deemed to be a part of this instrument as fully and
to the same extent as though said provisions had been set forth in full in this
instrument except that the following sections of the Indenture hereby are
amended as follows:
<PAGE>
(a) All references to "The Chase Manhattan Bank (National
Association)" are replaced with "The Chase Manhattan Bank".
(b) Notwithstanding any provision of the Indenture to the contrary,
ownership of Units of this series of Equity Securities Trust shall not be
certificated and shall be evidenced solely by registration on the transfer books
of the Trustee, and the registered holder of uncertificated Units shall have all
of the rights and obligations (excluding the right to the issuance of a
Certificate) specified for a registered Certificateholder under the Indenture.
The Depositor and the Trustee shall cause all Units of the Trust issued to the
Depositor (upon both the initial deposit and any deposits of Additional
Securities pursuant to Section 2.6) to be deposited at The Depository Trust
Company ("DTC") and to be credited there to the account of the Depositor. On
and after such deposit, for all purposes under the Indenture and Agreement, the
sole registered holder of Units of the Trust shall be DTC, or its nominee,
unless and until DTC has notified the Trustee and the Depositor that it is no
longer willing to act as depository with respect to the Units. Accordingly, so
long as DTC, or its nominee, is the registered owner of the Trust Units,
beneficial ownership of Units may only be maintained by or through a participant
in DTC and shall be subject to the rules and operating procedures of DTC as in
effect from time to time. The Trustee shall not be liable for any loss or
liability resulting from the actions of DTC as registered holder and depository
of the Units.
(c) Sections 1.2 and 2.4 and any reference herein to the issuance of
Certificates shall be deleted.
(d) Section 2.3 shall be amended by adding after the words "has
registered on the registration books of the Trust the ownership by" the words
"the Depositor of such Units or, if requested by the Depositor, the ownership
by."
(e) Paragraph (a) of Section 2.6 shall be amended to read in its
entirety as follows:
"Section 2.6 Deposit of Additional Securities. (a) Subject to
--------------------------------
the requirements set forth below in this Section, the Depositor
may, on any Business Day (the "Trade Date"), subscribe for
Additional Units as follows:
(1) Prior to the Evaluation Time on the Trade Date, the
Depositor shall provide notice (the "Subscription Notice") to the
Trustee, by telecopy or by written communication, of the
Depositor's intention to subscribe for Additional Units. The
Subscription Notice shall identify the Additional Securities to
be acquired (unless such Additional Securities are a precise
replication of the then existing portfolio) and shall either (i)
specify the quantity of Additional Securities to be deposited by
the Depositor on the settlement date for such subscription or
(ii) instruct the Trustee to purchase Additional Securities with
an aggregate value as specified in the Subscription Notice.
-2-
<PAGE>
(2) Promptly following the Evaluation Time on such Business Day,
the Depositor shall verify with the Trustee, by telecopy, the
number of Additional Units to be created.
(3) Not later than the time on the settlement date for such
subscription when the Trustee is to deliver the Additional Units
created thereby (which time shall not be later than the time by
which the Trustee is required to settle any contracts for the
purchase of Additional Securities entered into by the Trustee
pursuant to the instruction of the Depositor referred to in
subparagraph (1) above), the Depositor shall deposit with the
Trustee (i) any Additional Securities specified in the
Subscription Notice (or contracts to purchase such Additional
Securities together with cash or a letter of credit in the amount
necessary to settle such contracts) or (ii) cash or a letter of
credit in the amount equal to the aggregate value of the
Additional Securities specified in the Subscription Notice,
together with, in each case, Cash as defined below. "Cash"
means, as to the Principal Account, cash or other property (other
than Securities) on hand in the Principal Account or receivable
and to be credited to the Principal Account as of the Evaluation
Time on the Business Day preceding the Trade Date (other than
amounts to be distributed solely to persons other than persons
receiving the distribution from the Principal Account as holders
of Additional Units created by the deposit), and, as to the
Income Account, cash or other property (other than Securities)
received by the Trust as of the Evaluation Time on the Business
Day preceding the Trade Date or receivable by the Trust in
respect of dividends or other distributions declared but not
received as of the Evaluation Time on the Business Day preceding
the Trade Date, reduced by the amount of any cash or other
property received or receivable on any Security allocable (in
accordance with the Trustee's calculation of the monthly
distribution from the Income Account pursuant to Section 3.5) to
a distribution made or to be made in respect of a Record Date
occurring prior to the Trade Date. Each deposit made during the
90 days following the deposit made pursuant to Section 2.1 hereof
shall replicate, to the extent practicable, as specified in
subparagraph (b), the Original Proportionate Relationship. Each
deposit made after the 90 days following the deposit made
pursuant to Section 2.1 hereof (except for deposits made to
replace Failed Securities if such deposits occur within 20 days
from the date of a failure occurring within such initial 90 day
period) shall maintain exactly the proportionate relationship
existing among the Securities as of the expiration of such 90 day
period. Each such deposit shall exactly replicate Cash.
(4) On the settlement date for a subscription, the Trustee
shall, in exchange for the Securities and cash or letter of
credit described above, issue and
-3-
<PAGE>
deliver to or on the order of the Depositor the number of Units
verified by the Depositor with the Trustee. No Unit to be issued
pursuant to this paragraph shall be issued or delivered unless
and until Securities, cash or a letter of credit is received in
exchange therefor and no person shall have any claim to any Unit
not so issued and delivered or any interest in the Trust in
respect thereof.
(5) Each deposit of Additional Securities, shall be listed in a
Supplementary Schedule to an Addendum to the Reference Trust
Agreement stating the date of such deposit and the number of
Additional Units being issued therefor. The Trustee shall
acknowledge in such Addendum the receipt of the Deposit and the
number of Additional Units issued in respect thereof. The
Additional Securities shall be held, administered and applied by
the Trustee in the same manner as herein provided for the
Securities.
(6) The acceptance of Additional Units by the Depositor in
accordance with the provisions of paragraph (a) of this Section
shall be deemed a certification by the Depositor that the deposit
or purchase of Additional Securities associated therewith
complies with the conditions of this Section 2.06.
(7) Notwithstanding the preceding, in the event that the
Sponsor's Subscription Notice shall instruct the Trustee to
purchase Additional Securities in an amount which, when added to
the purchase amount of all other unsettled contracts entered into
by the Trustee, exceeds 25% of the value of the Securities then
held (taking into account the value of contracts to purchase
Securities only to the extent that there has been deposited with
the Trustee cash or an irrevocable letter of credit in an amount
sufficient to settle their purchase), the Sponsor shall deposit
with the Trustee concurrently with the Subscription Notice such
that, when added to 25% of the value of the Securities then held
(determined as above) the aggregate value shall be not less than
the purchase amount of the securities to be purchased pursuant to
such Subscription Notice."
(f) Section 3.1 is hereby amended in its entirety to read as follows:
"Section 3.1. Initial Cost: The cost of the initial preparation,
----------- ------------
printing and execution of the Certificates and this Indenture, the
initial fees of the Trustee and its counsel, and the initial fees of
the Evaluator and other reasonable expenses in connection therewith,
shall be paid by the Depositor, provided, however, that the liability
on the part of the Depositor for such initial costs, fees and expenses
shall not include any fees, costs or other expenses incurred in
connection herewith after the execution of this Indenture and the
deposit referred to in Section 2.01.
-4-
<PAGE>
Upon notification from the Depositor that the primary offering period
is concluded, the Trustee shall withdraw from the Account or Accounts
specified in the Prospectus or, if no Account is therein specified,
from the Principal Account, and pay to the Depositor the Depositor's
reimbursable expenses of organizing the Trust and sale of the Trust
Units in an amount certified to the Trustee by the Depositor. If the
balance of the Principal Account is insufficient to make such
withdrawal, the Trustee shall, as directed by the Depositor, sell
Securities identified by the Depositor, or distribute to the Depositor
Securities having a value, as determined under Section 4.1 as of the
date of distribution, sufficient for such reimbursement. The
reimbursement provided for in this section shall be for the account of
the Unitholders of record at the conclusion of the primary offering
period and shall not be reflected in the computation of Unit Value
prior thereto. As used herein, the Depositor's reimbursable expenses
of organizing the Trust and sale of the Trust Units shall include the
cost of the initial preparation and typesetting of the registration
statement, prospectuses (including preliminary prospectuses), the
indenture, and other documents relating to the Trust, SEC and state
blue sky registration fees and expenses of the Trustee, and legal and
other out-of-pocket expenses related thereto but not including the
expenses incurred in the printing of preliminary prospectuses and
prospectuses, expenses incurred in the preparation and printing of
brochures and other advertising materials and any other selling
expenses. Any cash which the Depositor has identified as to be used
for reimbursement of expenses pursuant to this Section shall be
reserved by the Trustee for such purpose and shall not be subject to
distribution or, unless the Depositor otherwise directs, used for
payment of redemptions in excess of the per-Unit amount allocable to
Units tendered for redemption."
(g) Section 3.5 is hereby amended by inserting the phrase "or Income"
in the second sentence of the sixth paragraph after the words "The Trustee shall
not be required to make a distribution from the Principal..."
(h) Section 3.11 is hereby amended so that the first sentence of such
section reads as follows:
"In the event that an offer by the issuer of any of the
Securities or any other party shall be made to issue new
Securities, the Trustee shall reject such offer, except that if
(1) the issuer failed to declare or pay anticipated dividends
with respect to such Securities or (2) in the opinion of the
Sponsor, given in writing to the Trustee, the issuer will
probably fail to declare or pay anticipated dividends with
respect to such Securities in the reasonably foreseeable future,
the Sponsor shall instruct the Trustee in writing to accept or
reject such offer and to take any other action with respect
thereto as the Sponsor may deem proper."
-5-
<PAGE>
(i) Section 3.14 is hereby amended by inserting the phrase "including,
but not limited to securities received as a result of a spin-off" in the first
sentence after the words "Any property received by the Trustee after the initial
date of Deposit in a form other than cash or additional shares of the Securities
listed on Schedule A..."
(j) ARTICLE 3 shall be amended to add a new Section 3.15 as follows:
"SECTION 3.15. Deferred Sales Charge: The Trustee shall, on the
---------------------
dates specified in and as permitted by the Prospectus, withdraw from
the Income Account, the Principal Account and/or distributions to be
made therefrom, as such accounts or distributions are designated in
the Prospectus as the source of the payments of the Deferred Sales
Charge, an amount per Unit specified in the Prospectus and credit such
amount to a special, non-Trust account maintained at the Trustee out
of which the Deferred Sales Charge will be distributed to the
Depositor. If the balances in the Income and Principal Accounts are
insufficient to make any withdrawal designated to be made therefrom,
the Trustee shall, as directed by the Depositor, either advance funds
in an amount equal to the proposed withdrawal and be entitled to
reimbursement of such advance upon the deposit of additional monies in
the Income Account or the Principal Account, sell Securities and
credit the proceeds thereof to such special Depositor's account or
credit Securities in kind to such special Depositor's Account
provided, however, that the Trustee shall not be required to advance
an aggregate amount in excess of $15,000 pursuant to this Section.
Such directions shall identify the Securities, if any, to be sold or
distributed in kind and shall contain, if the Trustee is directed by
the Depositor to sell a Security, instructions as to execution of such
sales. The Trustee shall have no liability for any loss or
depreciation resulting from sales made in accordance with the
Sponsor's instruction. If a Certificateholder redeems Units prior to
full payment of the Deferred Sales Charge, the Trustee shall, if so
provided in the Prospectus, on the Redemption Date, withhold from the
Redemption Price payment to such Certificateholder an amount equal to
the unpaid portion of the Deferred Sales Charge and distribute such
amount to such special Depositor's Account or, if the Depositor shall
purchase such Unit pursuant to the terms of Section 5.2 hereof, the
Depositor shall pay the Redemption Price for such Unit less the unpaid
portion of the Deferred Sales Charge. If the Prospectus provides for
a waiver or refund of any portion of the Deferred Sales Charge under
specified circumstances (such as, for example, in connection with a
redemption or sale of Units following the death or disability of the
Certificateholder), the Trustee shall deduct and pay to the Depositor
the full amount of the Deferred Sales Charge chargeable upon the
redemption in the absence of such waiver or refund and the Depositor
shall pay to the affected Certificateholder the amount of such waiver
or refund; the Trustee shall have no responsibility to the affected
Certificateholder with respect to the amount to be so refunded. The
Depositor may at any time
-6-
<PAGE>
instruct the Trustee to distribute to the Depositor cash or Securities
previously credited to the special Depositor's Account."
(k) Section 5.1 of the Agreement is amended by deleting clause (a)(4)
in the first paragraph and deleting clause (i) from the first sentence of the
second paragraph and renumbering the remaining clauses accordingly.
(l) Section 9.2 is hereby amended by replacing the phrase "60 business
days" with "7 days" in the first sentence of the sixth paragraph.
(m) Section 9.2 of the Agreement is further amended by adding the
following paragraph after the sixth paragraph of such Section 9.2:
"In the event that the Depositor directs the Trustee that certain
Securities will be sold to a new series of the Trust (a "New Series"),
the Depositor will certify to the Trustee, within five days of each
sale from a Trust to a New Series, (1) that the transaction is
consistent with the policy of both the Trust and the New Series, as
recited in their respective registration statements and reports filed
under the Act, (2) the date of such transaction and (3) the closing
sales price on the national securities exchange for the sale date of
the securities subject to such sale. The Trustee will then countersign
the certificate, unless the Trustee disagrees with the closing sales
price listed on the certificate, whereupon the Trustee will promptly
inform the Depositor orally of any such disagreement and return the
certificate within five days to the Depositor with corrections duly
noted. Upon the Depositor's receipt of a corrected certificate, if
the Depositor can verify the corrected price by reference to an
independently published list of closing sales prices for the date of
the transactions, the Depositor will ensure that the price of Units of
the New Series, and distributions to holders of the Trust with regard
to redemption of their Units or termination of the Trust, accurately
reflect the corrected price. To the extent that the Depositor
disagree with the Trustee's corrected price, the Depositor and the
Trustee will jointly determine the correct sales price by reference to
a mutually agreeable, independently published list of closing sales
prices for the date of the transaction. The Depositor and Trustee
will periodically review the procedures for sales and make such
changes as they deem necessary, consistent with Rule 17a-7(e)(2).
Finally, records of the procedures and of each transaction will be
maintained as provided in Rule 17a-7(f)."
(n) All references to "Reich & Tang Distributors L.P.". are replaced
with "Reich & Tang Distributors, Inc."
Section 2. This Reference Trust Agreement may be amended and modified
by Addendums, attached hereto, evidencing the purchase of Additional Securities
which have been deposited to effect an increase over the number of Units
initially specified in Part II of this
-7-
<PAGE>
Reference Trust Agreement ("Additional Closings"). The Depositor and Trustee
hereby agree that their respective representations, agreements and
certifications contained in the Closing Memorandum dated November 18, 1999,
relating to the initial deposit of Securities continue as if such
representations, agreements and certifications were made on the date of such
Additional Closings and with respect to the deposits made therewith, except as
such representations, agreements and certifications relate to their respective
By-Laws and as to which they each represent that their has been no amendment
affecting their respective abilities to perform their respective obligations
under the Indenture.
Part II
SPECIAL TERMS AND CONDITIONS OF TRUST
Section 1. The following special terms and conditions are hereby
agreed to:
(a) The Securities (including Contract Securities) listed in the
Prospectus relating to this series of Equity Securities Trust (the "Prospectus")
have been deposited in the Trust under this Agreement (see "Portfolio" in Part A
of the Prospectus which for purposes of this Indenture and Agreement is the
Schedule of Securities or Schedule A).
(b) The number of Units delivered by the Trustee in exchange for the
Securities referred to in Section 2.3 is 15,100.
(c) For the purposes of the definition of Unit in item (22) of Section
1.1, the fractional undivided interest in and ownership of the Trust initially
is 1/ 15,100 of the date hereof.
(d) The term Record Date shall mean the fifteenth day of June and
December commencing on June 15, 2000.
(e) The term Distribution Date shall mean the last business day of
June and December commencing on June 30, 2000.
(f) The First Settlement Date shall mean November 23, 1999.
(g) For purposes of Section 6.1(g), the liquidation amount is hereby
specified to be 40% of the aggregate value of the Securities at the completion
of the Deposit Period.
(h) For purposes of Section 6.4, the Trustee shall be paid per annum
an amount computed according to the following schedule, determined on the basis
of the number of Units outstanding as of the Record Date preceding the Record
Date on which the compensation is to be paid, provided, however, that with
respect to the period prior to the first Record Date, the Trustee's compensation
shall be computed at $.86 per 100 Units:
-8-
<PAGE>
rate per 100 units number of Units outstanding
$0.86 5,000,000 or less
$0.80 5,000,001 - 10,000,000
$0.74 10,000,001 - 20,000,000
$0.62 20,000,001 or more
(i) For purposes of Section 7.4, the Depositor's maximum annual
supervisory fee is hereby specified to be $.30 per 100 Units outstanding.
(j) The Mandatory Termination Date shall be February 21, 2001 or the
earlier disposition of the last Security in the Trust.
(k) The fiscal year for the Trust shall end on June 30 of each year.
IN WITNESS WHEREOF, the parties hereto have caused this Reference
Trust Agreement to be duly executed on the date first above written.
[Signatures on separate pages]
-9-
<PAGE>
REICH & TANG DISTRIBUTORS, INC.
Depositor
By: /s/ Peter J. DeMarco
--------------------
Executive Vice President
STATE OF NEW YORK )
:ss:
COUNTY OF NEW YORK )
On this 17th day of November, 1999, before me personally appeared Peter
J. DeMarco, to me known, who being by me duly sworn, said that he is Executive
Vice President of the Depositor, one of the corporations described in and which
executed the foregoing instrument, and that he signed his name thereto by
authority of the Board of Directors of said corporation.
/s/ Teresa Scarfone
-------------------
Notary Public
Teresa Scarfone
NOTARY PUBLIC, State of New York
No. 31-4752576
Qualified in New York County
Term Expires 8/31/00
<PAGE>
THE CHASE MANHATTAN BANK
Trustee
By: /s/ Rosalia A. Raviele
-----------------------
Vice President
(SEAL)
STATE OF NEW YORK )
:ss.:
COUNTY OF NEW YORK )
On this 17th day of November, 1999, before me personally appeared
Rosalia A. Raviele, to me known, who being by me duly sworn, said that (s)he is
an Authorized Signator of The Chase Manhattan Bank, one of the corporations
described in and which executed the foregoing instrument; that (s)he knows the
seal of said corporation; that the seal affixed to said instrument is such
corporate seal; that it was so affixed by authority of the Board of Directors of
said corporation and that (s)he signed his/her name thereto by like authority.
/s/ Ada Iris Vega
----------------------
Notary Public
<PAGE>
EXHIBIT 99.3.1
BATTLE FOWLER LLP
PARK AVENUE TOWER
75 EAST 55TH STREET
NEW YORK, N.Y. 10022-3205
2049 CENTURY PARK EAST CABLE ADDRESS
SUITE 2350 "COUNSELLOR"
LOS ANGELES, CA 90057-3101 -----
TELEPHONE:(310) 778-3000 FACSIMILE
FAX: (310) 277-0336 (212) 339-9150
www. battlefowler.com
(212)856-7000
(212)856-7816
November 18, 1999
Reich & Tang Distributors, Inc.
600 Fifth Avenue
New York, New York 10020
Re: Equity Securities Trust, Series 25, Symphony Series,
Zacks All - Star Analysts Trust V
----------------------------------------------------
Dear Sirs:
We have acted as special counsel for Reich & Tang Distributors, Inc., as
Depositor, Sponsor and Principal Underwriter (collectively, the "Depositor") of
Equity Securities Trust, Series 25, Symphony Series, Zacks All - Star Analysts
Trust V (the "Trust"), in connection with the issuance by the Trust of units of
fractional undivided interest (the "Units") in the Trust. Pursuant to the Trust
Agreements referred to below, the Depositor has transferred to the Trust certain
securities and contracts to purchase certain securities together with an
irrevocable letter of credit to be held by the Trustee upon the terms and
conditions set forth in the Trust Agreement. (All securities to be acquired by a
Trust are collectively referred to as the "Securities").
In connection with our representation, we have examined copies of the
following documents relating to the creation of the Trust and the issuance and
sale of the Units: (a) the Trust Indenture and Agreement and related Reference
Trust Agreement, each of even date herewith, relating to the Trust (collectively
the "Trust Agreements") among the Depositor and The Chase Manhattan Bank, as
Trustee; (b) the Notification of Registration on Form N-8A and the Registration
Statement on Form N-8B-2, as amended, relating to the Trust, as filed with the
Securities and Exchange Commission (the "Commission") pursuant to the Investment
Company Act of 1940 (the "1940 Act"); (c) the Registration Statement on Form S-6
(Registration No. 333-90875) filed with the Commission pursuant to the
Securities Act of 1933 (the "1933 Act"), and all Amendments thereto (said
Registration Statement, as amended by said Amendment(s) being herein called the
"Registration
<PAGE>
2
Reich & Tang Distributors, Inc.
November 18, 1999
Statement"); (d) the proposed form of final Prospectus (the "Prospectus")
relating to the Units, which is expected to be filed with the Commission this
day; (e) certified resolutions of the Board of Directors of the Depositor
authorizing the execution and delivery by the Depositor of the Trust Agreements
and the consummation of the transactions contemplated thereby; (f) the
Certificate of Incorporation of the Depositor; and (g) a certificate of an
authorized officer of the Depositor with respect to certain factual matters
contained therein.
We have examined the Order of Exemption from certain provisions of
Sections 11(a) and 11(c) of the 1940 Act, filed on behalf of Reich & Tang
Distributors L.P. (the predecessor to Reich & Tang Distributors, Inc.); Equity
Securities Trust (Series 1, Signature Series and Subsequent Series), Mortgage
Securities Trust (CMO Series 1 and Subsequent Series), Municipal Securities
Trust, Series 1 (and Subsequent Series) (including Insured Municipal Securities
Trust, Series 1 (and Subsequent Series and 5th Discount Series and Subsequent
Series)); New York Municipal Trust (Series 1 and Subsequent Series); and A
Corporate Trust (Series 1 and Subsequent Series) granted on October 9, 1996. In
addition, we have examined the Order of Exemption from certain provisions of
Sections 2(a)(32), 2(a)(35), 22(d) and 26(a)(2) of the 1940 Act and Rule 22c-1
thereunder, filed on behalf of Reich & Tang Distributors L.P.; Equity Securities
Trust; Mortgage Securities Trust; Municipal Securities Trust (including Insured
Municipal Securities Trust); New York Municipal Trust; A Corporate Trust; Schwab
Trusts; and all presently outstanding and subsequently issued series of these
trusts and all subsequently issued series of unit investment trusts sponsored by
Reich & Tang Distributors L.P. granted on October 29, 1997.
We have not reviewed the financial statements, compilation of the
Securities held by the Trust, or other financial or statistical data contained
in the Registration Statement and the Prospectus, as to which you have been
furnished with the reports of the accountants appearing in the Registration
Statement and the Prospectus.
In addition, we have assumed the genuineness of all agreements,
instruments and documents submitted to us as originals and the conformity to
originals of all copies thereof submitted to us. We have also assumed the
genuineness of all signatures and the legal capacity of all persons executing
agreements, instruments and documents examined or relied upon by us.
Statements in this opinion as to the validity, binding effect and
enforceability of agreements, instruments and documents are subject: (i) to
limitations as to enforceability imposed by bankruptcy, reorganization,
moratorium, insolvency and other laws of general application relating to or
affecting the enforceability of creditors' rights, and (ii) to limitations under
equitable principles governing the availability of equitable remedies.
<PAGE>
3
Reich & Tang Distributors, Inc.
November 18, 1999
We are not admitted to the practice of law in any jurisdiction but the
State of New York and we do not hold ourselves out as experts in or express any
opinion as to the laws of other states or jurisdictions except as to matters of
Federal and Delaware corporate law.
Based exclusively on the foregoing, we are of the opinion that under
existing law:
(1) The Trust Agreements have been duly authorized and entered into by an
authorized officer of the Depositor and are valid and binding obligations of the
Depositor in accordance with their respective terms.
(2) The registration of the Units on the registration books of the Trust
by the Trustee has been duly authorized by the Depositor in accordance with the
provisions of the respective Trust Agreements and issued for the consideration
contemplated therein, will constitute fractional undivided interests in the
Trust, will be entitled to the benefits of the Trust Agreements, will conform
in all material respects to the description thereof for the Units as provided in
the Trust Agreements and the Registration Statement, and the Units will be fully
paid and non-assessable by the Trust.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of our name in the Registration Statement
and in the Prospectus under the headings "Tax Status" and "Legal Opinions". We
authorize you to deliver copies of this opinion to the Trustee and the Trustee
may rely on this opinion as fully and to the same extent as if it had been
addressed to it.
This opinion is intended solely for the benefit of the addressees and the
Trustee in connection with the issuance of the Units of the Trust and may not
be relied upon in any other manner or by any other person without our express
written consent.
Very truly yours,
/s/ Battle Fowler LLP
Battle Fowler LLP
