MEMORANDUM OF CHANGES
VAN KAMPEN FOCUS PORTFOLIOS, SERIES 224
The Prospectus filed with Amendment No. 2 of the Registration Statement
on Form S-6 has been revised to reflect information regarding the deposit of Van
Kampen Focus Portfolios, Series 224 on December 12, 2000. An effort has been
made to set forth below each of the major changes and also to reflect the same
by blacklining the marked counterparts of the Prospectus submitted with the
Amendment.
Pages 2-3. The "Summary of Essential Financial Information" and "Fee
Table" sections have been completed.
Pages 4-7. Certain revisions have been made and the "Portfolio" and
the notes thereto has been completed.
Pages 8-12. The descriptions of the portfolio securities have been
completed.
Pages 13-14. The Report of Independent Certified Public Accountants
and Statement of Condition have been completed.
FILE NO. 333-34318
CIK #1104554
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
Amendment No. 2
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: VAN KAMPEN FOCUS PORTFOLIOS, SERIES 224
B. Name of Depositor: VAN KAMPEN FUNDS INC.
C. Complete address of Depositor's principal executive offices:
One Parkview Plaza
Oakbrook Terrace, Illinois 60181
D. Name and complete address of agents for service:
CHAPMAN AND CUTLER VAN KAMPEN FUNDS INC.
Attention: Mark J. Kneedy Attention: A. Thomas Smith III, General Counsel
111 West Monroe Street One Parkview Plaza
Chicago, Illinois 60603 Oakbrook Terrace, Illinois 60181
E. Title of securities being registered: Units of undivided beneficial
interest.
F. Approximate date of proposed sale to the public:
AS SOON AS PRACTICABLE AFTER THE EFFECTIVE DATE OF THE
REGISTRATION STATEMENT
/ X / Check box if it is proposed that this filing will become effective at
8:00 a.m. on December 12, 2000 pursuant to Rule 487.
VAN KAMPEN
FOCUS PORTFOLIOS(SM)
A DIVISION OF VAN KAMPEN FUNDS INC.
SELECT GROWTH TRUST, DECEMBER 2000 SERIES
--------------------------------------------------------------------------------
Van Kampen Focus Portfolios, Series 224 includes the unit investment trust
described above (the "Trust"). The Trust seeks to increase the value of your
Units by investing primarily in a diversified portfolio of common stocks of some
of the most widely held and well-capitalized companies in the United States. Of
course, we cannot guarantee that the Trust will achieve its objective.
DECEMBER 12, 2000
YOU SHOULD READ THIS PROSPECTUS AND RETAIN IT FOR FUTURE REFERENCE.
--------------------------------------------------------------------------------
The Securities and Exchange Commission has not approved or disapproved of the
Units or passed upon the adequacy or accuracy of this prospectus.
Any contrary representation is a criminal offense.
SUMMARY OF ESSENTIAL FINANCIAL INFORMATION
DECEMBER 12, 2000
PUBLIC OFFERING PRICE
Aggregate value of Securities per Unit (1) $ 9.62
Sales charge 0.38
Public offering price per Unit (2) $ 10.00
TRUST INFORMATION
Initial number of Units (3) 15,176
Aggregate value of Securities (1) $ 145,990
Estimated initial distribution per Unit (March, 2001)(4) $ 0.02
Estimated annual dividends per Unit (4) $ 0.12098
Redemption price per Unit (5) $ 9.62
GENERAL INFORMATION
Initial Date of Deposit December 12, 2000
Mandatory Termination Date March 12, 2006
Record Dates Tenth day of March, June,
September and December
Distribution Dates Twenty-fifth day of March,
June, September and December
--------------------------------------------------------------------------------
(1)Each Security is valued at the most recent closing sale price as of the
close of the New York Stock Exchange on the business day before the Initial
Date of Deposit.
(2)You will bear all or a portion of the expenses incurred in organizing and
offering your Trust. The Public Offering Price includes the estimated amount
of these costs. These costs include the cost of preparation and printing of
the trust agreement, registration statement and other documents relating to
the Trust, federal and state registration fees and costs, initial fees and
expenses of the Trustee, and legal and auditing expenses. The Trustee will
deduct these expenses from your Trust at the end of the initial offering
period or six months following the Initial Date of Deposit (whichever is
earlier). The estimated amount is described on the next page. The Public
Offering Price will include any accumulated dividends or cash in the Income
or Capital Accounts.
(3)The number of Units may be adjusted so that the Public Offering Price per
Unit equals $10 as of the close of the New York Stock Exchange on the Initial
Date of Deposit. The number of Units and fractional interest of each Unit
will increase or decrease to the extent of any adjustment.
(4)This estimate is based on the most recently declared quarterly dividends or
interim and final dividends accounting for any foreign withholding taxes.
Actual dividends may vary due to a variety of factors. See "Risk Factors".
(5)The redemption price includes the estimated organizational and offering
costs. The redemption price will not include these costs after the initial
offering period. See "Rights of Unitholders--Redemption of Units".
FEE TABLE
TRANSACTION FEES (AS % OF OFFERING PRICE)
Maximum sales charge (1)............................. 3.80%
==========
Maximum sales charge on reinvested dividends......... 0.00%
==========
ESTIMATED ORGANIZATIONAL COSTS PER UNIT (2).......... $ 0.02158
==========
ESTIMATED ANNUAL EXPENSES PER UNIT
Trustee's fee and operating expenses................. $ 0.01051
Evaluation fees...................................... $ 0.00250
Supervisory fees..................................... $ 0.00250
----------
Estimated annual expenses per Unit................... $ 0.01551
==========
ESTIMATED COSTS OVER TIME
One year............................................. $ 42
Three years.......................................... $ 46
Five years........................................... $ 50
Life of Trust........................................ $ 60
This fee table is intended to assist you in understanding the costs that you
will bear and to present a comparison of fees. The "Estimated Costs Over Time"
example illustrates the expenses you would pay on a $1,000 investment assuming a
5% annual return and redemption at the end of each period. This example assumes
that you reinvest your Trust distributions at the end of each year. Of course,
you should not consider this example a representation of actual past or future
expenses or annual rate of return which may differ from those assumed for this
example. The sales charge and expenses are described under "Public Offering" and
"Trust Operating Expenses".
--------------------------------------------------------------------------------
(1)The sales charge is equivalent to 3.950% of the aggregate value of the
Securities. A reduced sales charge applies to transactions involving $25,000
or more.
(2)You will bear all or a portion of the expenses incurred in organizing and
offering your Trust. The Trustee will deduct the actual amount of these
expenses from your Trust at the end of the initial offering period.
SELECT GROWTH TRUST
The Trust seeks to increase the value of your Units over time by investing
primarily in some of the most widely held and well-capitalized companies in the
United States. In selecting the Securities, Edward Jones & Co. (the
"Underwriter") considered companies recognized as leaders in their respective
industries, diversification across a broad range of economic sectors seeking to
manage the inherent risk associated with stocks, and companies in a position to
benefit from worldwide growth. Investing in blue chip stocks may provide the
potential for capital appreciation and dividend income. Equities have
historically outperformed other investments, such as Treasury bills and
government bonds over the long term.
Many of the blue chip companies in the Trust are considered industry leaders
in their respective markets. These companies are typically well-managed,
financially strong and proven performers. As large corporations, they also share
several characteristics: leading market share in their industry; diversified
line of products and/or services; well-capitalized; research and development
prowess providing new high-quality products; and large advertising budgets
capable of producing consistent sales.
Companies that demonstrate both worldwide business prospects and a dominant
position in a particular industry may have a distinct competitive advantage.
Such companies are targeted by the Trust. Although the world economy may be more
interconnected than ever before, not all regions of the world have the same
economic environment. Consequently, a company that provides products and
services in several countries can often weather difficult periods in one
geographic region while gaining business in another. The Trust offers a broad
base of companies whose goods and services are used worldwide, which may help
reduce overall investment risk.
The Trust seeks to benefit from wide diversification. Companies included in
the Trust cover several industry sectors and offer many products and services.
These sectors and products include:
o Basic Materials -- chemical, natural resources and industrial products
o Capital Goods/Industrials -- machine tools
o Communication Services -- long distance, local and cellular
communications products and services
o Consumer Cyclicals and Consumer Staples-- food, household and
entertainment products
o Energy -- oil, natural gas and fossil fuels
o Financial Services -- insurance and investment products and services
o Health Care -- HMOs, medical devices and pharmaceuticals
o Technology -- computer software, hardware and Internet products
Of course, we cannot guarantee that the Trust will achieve its objective. The
value of your Units may fall below the price you paid for the Units. You should
read the "Risk Factors" section before you invest.
<TABLE>
<CAPTION>
PORTFOLIO
--------------------------------------------------------------------------------------------------------------
CURRENT COST OF
NUMBER MARKET VALUE DIVIDEND SECURITIES
OF SHARES NAME OF ISSUER (1) PER SHARE (2) YIELD (3) TO TRUST (2)
---------- ----------------------------------- --------------- ----------- -------------
<S> <C> <C> <C> <C>
BASIC MATERIALS
72 Du Pont (E. I.) de Nemours and Company $ 41.938 3.34% $ 3,019.50
CAPITAL GOODS/ INDUSTRIALS
40 Emerson Electric Company 76.500 2.00 3,060.00
52 Illinois Tool Works, Inc. 60.625 1.32 3,152.50
62 Johnson Controls, Inc. 50.188 2.47 3,111.63
CONSUMER SERVICES
61 SBC Communications, Inc. 50.813 2.00 3,099.56
115 Sprint Corporation (PCS Group) 26.875 0.00 3,090.63
+ 77 Vodafone Group PLC 39.688 0.50 3,055.94
203 WorldCom, Inc. 16.438 0.00 3,336.81
CONSUMER CYCLICALS
187 Leggett & Platt, Inc. 16.813 2.62 3,143.94
66 The Home Depot, Inc. 45.125 0.35 2,978.25
72 The Interpublic Group of Companies, Inc. 43.313 0.88 3,118.50
58 Wal-Mart Stores, Inc. 51.375 0.47 2,979.75
CONSUMER STAPLES
54 Colgate-Palmolive Company 56.550 1.11 3,053.70
104 McDonald's Corporation 29.938 0.72 3,113.50
65 PepsiCo, Inc. 47.063 1.19 3,059.06
77 The Clorox Company 39.938 2.10 3,075.19
101 The Walt Disney Company 30.375 0.69 3,067.88
ENERGY
+ 64 BP Amoco Plc 48.000 2.53 3,072.00
35 Exxon Mobil Corporation 85.750 2.05 3,001.25
+ 55 Royal Dutch Petroleum Company 54.938 2.14 3,021.56
FINANCIAL SERVICES
55 American Express Company 56.500 0.57 3,107.50
30 American International Group, Inc. 100.063 0.15 3,001.88
73 Bank of America Corporation 43.438 5.16 3,170.94
59 Citigroup, Inc. 52.875 1.06 3,119.63
37 Fannie Mae 84.250 1.33 3,117.25
126 First Union Corporation 25.500 7.53 3,213.00
23 State Street Corporation 132.980 0.51 3,058.54
62 Wells Fargo & Company 49.750 1.93 3,084.50
HEALTH CARE
61 Abbott Laboratories 50.063 1.52 3,053.81
56 American Home Products Corporation 54.820 1.68 3,069.92
45 Bristol-Myers Squibb Company 66.563 1.65 2,995.31
32 Johnson & Johnson 95.625 1.34 3,060.00
55 Medtronic, Inc. 54.688 0.37 3,007.81
34 Merck & Company, Inc. 90.625 1.50 3,081.25
54 Schering-Plough Corporation 55.750 1.00 3,010.50
<CAPTION>
PORTFOLIO (CONTINUED)
--------------------------------------------------------------------------------------------------------------
CURRENT COST OF
NUMBER MARKET VALUE DIVIDEND SECURITIES
OF SHARES NAME OF ISSUER (1) PER SHARE (2) YIELD (3) TO TRUST (2)
---------- ----------------------------------- --------------- ----------- -------------
<S> <C> <C> <C> <C>
TECHNOLOGY
67 Applied Materials, Inc. $ 50.938 0.00% $ 3,412.81
49 Automatic Data Processing, Inc. 61.250 0.67 3,001.25
45 Celestica, Inc. 69.500 0.00 3,127.50
155 Compaq Computer Corporation 20.240 0.49 3,137.20
165 Dell Computer Corporation 20.063 0.00 3,310.31
93 Hewlett-Packard Company 33.125 0.97 3,080.63
88 Intel Corporation 37.500 0.21 3,300.00
196 Lucent Technologies, Inc. 16.688 0.48 3,270.75
55 Microsoft Corporation 58.063 0.00 3,193.44
+ 61 Nokia Oyj 50.500 0.32 3,080.50
^ 72 Nortel Networks Corporation 43.000 0.17 3,096.00
62 Texas Instruments, Inc. 51.875 0.16 3,216.25
---------- -------------
3,530 $ 145,989.63
========== =============
See "Notes to Portfolio".
</TABLE>
NOTES TO PORTFOLIO
(1) The Securities are initially represented by "regular way" contracts for
the performance of which an irrevocable letter of credit has been deposited with
the Trustee. Contracts to acquire Securities were entered into on December 11,
2000 and have a settlement date of December 14, 2000 (see "The Trust").
(2) The market value of each Security is based on the closing sale price as
of the close of the New York Stock Exchange on the business day prior to the
Initial Date of Deposit. Other information regarding the Securities, as of the
Initial Date of Deposit, is as follows:
PROFIT
COST TO (LOSS) TO
SPONSOR SPONSOR
-------------- --------------
$ 146,000 $ (10)
"+" indicates that the stock is held in the form of American Depositary
Receipts or similar receipts.
"^" indicates that the stock is a foreign common stock traded on a U.S.
securities exchange.
(3) Current Dividend Yield for each Security is based on the estimated
annual dividends per share and the Security's market value as of the close of
trading on the New York Stock Exchange on the business day prior to the Initial
Date of Deposit. Estimated annual dividends per share are calculated by
annualizing the most recently declared dividends or by adding the most recent
interim and final dividends declared and reflect any foreign withholding taxes.
THE SECURITIES. A brief description of each of the issuers of the Securities
is listed below.
Abbott Laboratories. Abbott Laboratories discovers, develops, manufactures,
and sells a broad and diversified line of health care products and services. The
company's products include pharmaceuticals, diagnostic products, hospital
products, chemical and agricultural products, and nutritionals. Abbott markets
its products worldwide through affiliates and distributors.
American Express Company. American Express Company, through its subsidiaries,
provides travel-related, financial advisory, and international banking services
around the world. The company's products include the American Express Card, the
Optima Card, and American Express Travelers Cheque.
American Home Products Corporation. American Home Products Corporation
discovers, develops, manufactures, distributes, and sells pharmaceuticals and
consumer healthcare products. The company's products include branded and generic
ethical pharmaceuticals, biologicals, nutritionals and animal biologicals and
pharmaceuticals.
American International Group, Inc. American International Group, Inc.,
through its subsidiaries, provides a variety of insurance and insurance-related
services in the United States and overseas. The company writes property and
casualty and life insurance, as well as provides financial services.
Applied Materials, Inc. Applied Materials, Inc. develops, manufactures,
markets, and services semiconductor wafer fabrication equipment and related
spare parts for the worldwide semiconductor industry. The company's customers
include semiconductor wafer manufacturers and semiconductor integrated circuit
manufacturers.
Automatic Data Processing, Inc. Automatic Data Processing, Inc. provides
computerized transaction processing, data communications, software, and
information services. The company also provides payroll services and human
resource information systems, as well as offers securities transaction
processing and investor communications services.
Bank of America Corporation. Bank of America Corporation is the holding
company for Bank of America and NationsBank. The company provides retail banking
services, asset management, financial products, corporate finance, specialized
finance, capital markets, and financial services. Bank of America operates
throughout the United States as well as throughout the world.
BP Amoco Plc. BP Amoco Plc is an oil and petrochemicals company. The company
explores for and produces oil and natural gas, refines, markets, and supplies
petroleum products, and manufactures and markets chemicals. BP Amoco's chemicals
include acetic acid, acrylonitrile, ethylene and polyethylene. The company has
operations in more than 70 countries.
Bristol-Myers Squibb Company. Bristol-Myers Squibb Company is a diversified
worldwide health and personal care company that manufactures medicines and other
products. The company's products include therapies for various diseases and
disorders, consumer medicines, orthopedic devices, ostomy care, wound
management, nutritional supplements, infant formulas, and hair and skin care
products.
Celestica, Inc. Celestica, Inc. provides a variety of services, including
design, prototyping, assembly, testing, product assurance, supply chain
management, worldwide distribution, and after-sales service. The company markets
its services to original equipment manufacturers. Celestica operates facilities
located in the US, Canada, Mexico, the UK, Ireland, Thailand, Hong Kong, and
China.
Citigroup, Inc. Citigroup, Inc. is a diversified financial services holding
company that provides a broad range of financial services to consumer and
corporate customers around the world. The company's services include investment
banking, retail brokerage, corporate banking, and cash management products and
services.
The Clorox Company. The Clorox Company produces and markets non-durable
consumer products sold primarily through grocery and other retail stores. The
company's principal products include household cleaning and bleach products,
charcoal, cat litter, automotive care products, dressings, and trash bags.
Clorox markets its products in the United States and other countries around the
world.
Colgate-Palmolive Company. Colgate-Palmolive Company is a consumer products
company that markets its products throughout the world. The company's products
include toothpaste, toothbrushes, shampoos, deodorants, bar and liquid soaps,
dishwashing liquid, and laundry products, among others. Colgate-Palmolive's
products are sold under brand names such as Colgate, Palmolive, Mennen, Ajax,
and Science Diet.
Compaq Computer Corporation. Compaq Computer Corporation, an information
technology company, develops and markets hardware, software, solutions, and
services. The company's products and solutions include enterprise computing
solutions, fault-tolerant business-critical solutions, networking and
communication products, commercial desktop and portable products, and consumer
personal computers.
Dell Computer Corporation. Dell Computer Corporation designs, develops,
manufactures, markets, services, and supports a variety of computer systems.
Computer systems include desktop computer systems, notebook computers,
workstations, network servers, and storage products. The company sells its
products and services to corporate, government, healthcare, and education
customers, as well as individuals.
Du Pont (E.I.) de Nemours and Company. Du Pont (E.I.) de Nemours and Company
is a global chemical and life sciences company, with businesses in
high-performance materials, specialty chemicals, pharmaceuticals, and
biotechnology. The company sells its products to the transportation, textile,
construction, automotive, agricultural, hybrid seeds, nutrition and health,
pharmaceuticals, packaging, and electronics markets.
Emerson Electric Company. Emerson Electric Company manufactures and markets
electrical, electromechanical, and electronic products and systems. The company
produces a variety of products, including process control, industrial
automation, electronics, appliance components, and electric motors. Emerson
sells its products around the world.
Exxon Mobil Corporation. Exxon Mobil Corporation operates petroleum and
petrochemicals businesses on a worldwide basis. The company's operations include
exploration and production of oil and gas, electric power generation, and coal
and minerals operations. Exxon Mobil also manufactures and markets fuels,
lubricants, and chemicals.
Fannie Mae. Fannie Mae buys and holds mortgages, and issues and sells
guaranteed mortgage-backed securities to facilitate housing ownership for low-
to middle-income Americans. The company was chartered by the United States
Congress, but went public in 1970.
First Union Corporation. First Union Corporation is a multi-bank holding
company operating in the eastern United States. The company provides a wide
range of commercial and retail banking and trust services. First Union also
provides other financial services, including mortgage banking, credit card,
investment banking, investment advisory, home equity lending, leasing,
insurance, and securities brokerage.
Hewlett-Packard Company. Hewlett-Packard Company provides imaging and
printing systems, computing systems, and information technology services for
business and home. The company's products include laser
and inkjet printers, scanners, copiers and faxes, personal computers,
workstations, storage solutions, and other computing and printing systems.
Hewlett-Packard sells its products worldwide.
The Home Depot, Inc. The Home Depot, Inc. sells building materials and home
improvement products. The company's stores sell plumbing, heating and electrical
supplies, lumber, floor and wall coverings, hardware, tools, paint, and lawn and
garden products. Home Depot operates in North and South America.
Illinois Tool Works, Inc. Illinois Tool Works, Inc. designs and manufactures
fasteners and components, equipment and consumable systems, and a variety of
specialty products and equipment. The company's products include industrial
fluids and adhesives, tooling for specialty applications, welding products, and
quality measurement equipment and systems. Illinois Tool Works operates
worldwide.
Intel Corporation. Intel Corporation designs, manufactures, and sells
computer components and related products. The company's major products include
microprocessors, chipsets, embedded processors and microcontrollers, flash
memory products, graphics products, network and communications products, systems
management software, conferencing products, and digital imaging products.
The Interpublic Group of Companies, Inc. The Interpublic Group of Companies,
Inc. is an organization of advertising agencies and marketing service companies.
The company operates globally in the sectors of advertising, independent media
buying, direct marketing, healthcare communications, interactive consulting
services, marketing research, promotions, experiential marketing, public
relations, and sports marketing.
Johnson & Johnson. Johnson & Johnson manufactures health care products and
provides related services. The company sells its products to the consumer,
pharmaceutical, and professional markets in countries around the world. Johnson
& Johnson's principal consumer products include BAND-AID adhesive bandages,
TYLENOL acetaminophen products, JOHNSON'S baby products, and STAYFREE sanitary
products, among others.
Johnson Controls, Inc. Johnson Controls, Inc. markets automotive systems and
building controls. The company supplies seating systems, interior systems, and
batteries. Johnson Control also provides building control systems and services,
energy management and integrated facility management.
Leggett & Platt, Inc. Leggett & Platt, Inc. manufactures a wide range of
engineered products. The company's products include components for bedding,
furniture, and other residential furnishings, as well as office and
institutional furnishings components, retail store fixtures, and displays.
Leggett also manufactures die castings and custom tooling, as well as drawn wire
and other products.
Lucent Technologies, Inc. Lucent Technologies, Inc. designs, builds, and
delivers a wide range of public and private networks, communications systems and
software, and data networking systems. The company also designs, builds, and
delivers business telephone systems and microelectronic components. Lucent
conducts its research and development activities through Bell Laboratories.
McDonald's Corporation. McDonald's Corporation develops, operates, franchises
and services a worldwide system of restaurants. These restaurants prepare,
assemble, package and sell a limited menu of quickly-prepared, moderately-priced
foods. The company operates restaurants in the United States and worldwide. Food
items include hamburgers, chicken, salads, breakfast foods, and beverages.
Medtronic, Inc. Medtronic, Inc. provides device-based therapies that restore
health, extend life, and alleviate pain. The company's principal products
include those for bradycardia pacing, tachyarrhythmia management, atrial
fibrillation management, heart failure management, heart valve replacement,
malignant and non-malignant pain, and movement disorders. Medtronic's products
are sold worldwide.
Merck & Company, Inc. Merck & Company, Inc. is a global pharmaceutical
company that discovers, develops, manufactures, and markets a broad range of
human and animal health products. The company also provides pharmaceutical
benefit services. Merck's products include Zocor, a treatment for elevated
cholesterol, Pepcid anti-ulcerant, Primaxin antibiotic, and Propecia, a
treatment for male pattern hair loss.
Microsoft Corporation. Microsoft Corporation develops, manufactures,
licenses, sells, and supports software products. The company offers operating
system software, server application software, business and consumer applications
software, software development tools, and Internet and intranet software.
Microsoft also develops the MSN network of Internet products and services.
Nokia Oyj. Nokia Oyj is an international telecommunications company. The
company develops and manufactures mobile phones and networks and systems for
cellular and fixed networks. Nokia also develops and supplies access networks,
multimedia equipment and other telecom related products. The company markets its
products and services worldwide.
Nortel Networks Corporation. Nortel Networks Corporation is an Internet and
communications provider with capabilities spanning optical, wireless, local
Internet, and electronic business. The company serves carrier, service provider,
and enterprise customers around the world. Nortel provides access products,
business applications and services, data and Internet products, and other
products and services.
PepsiCo, Inc. PepsiCo, Inc. operates worldwide soft drink, juice, and snack
food businesses. The company manufactures, sells, and distributes beverages such
as Pepsi-Cola, Slice, and Tropicana Pure Premium, as well as snack foods such as
LAY'S potato chips, DORITOS tortilla chips, and Rold Gold pretzels. PepsiCo owns
the international rights to the brand Seven-Up.
Royal Dutch Petroleum Company. Royal Dutch Petroleum Company owns 60% of the
Royal Dutch/Shell Group of companies. Through this interest, the company
explores for, produces, refines, and markets petroleum products, manufactures
chemicals, mines coal and non-ferrous metals, and produces solar cells. Royal
Dutch operates in approximately 135 countries.
SBC Communications, Inc. SBC Communications, Inc. provides communications
services in the United States and in other countries. The company provides local
and long-distance phone service, wireless and data communications, paging,
Internet access and messaging, cable and satellite television, security
services, and telecommunications equipment. SBC also provides directory
advertising and publishing.
Schering-Plough Corporations. Schering-Plough Corporation is a worldwide
pharmaceutical company that discovers and markets new therapies and treatment
programs. The company's core product groups include allergy/respiratory,
anti-infective/anticancer, dermatologicals, and cardiovasculars, as well as an
animal health business. Schering-Plough also conducts health management programs
and sells other consumer products.
Sprint Corporation (PCS Group). Sprint Corporation (PCS Group) operates a
100% digital, 100% personal cellular communication system (PCS) nationwide
wireless network in the United States. The company currently serves the United
States, Puerto Rico and the US Virgin Islands.
State Street Corporation. State Street Corporation services institutional
investors and manages financial assets worldwide. The company's products and
services include custody, accounting, daily pricing, international exchange
services, cash management, financial asset management, and lending activities.
Texas Instruments, Inc. Texas Instruments, Inc. is a global semiconductor
company that designs and supplies digital signal processing and analog
technologies. The company also operates materials and controls and educational
and productivity solutions businesses. Texas Instruments has manufacturing or
sales operations in countries around the world.
Vodafone Group PLC. Vodafone Group PLC provides mobile telecommunications
services. The company supplies customers with digital and analogue cellular
telephone, paging and mobile data and Internet services.
The Group, via a 50% joint venture with VivendiNet, operates the `VIZZAVI' brand
Internet portal company in Europe. Vodafone has agreements in over 100 countries
and across 230 networks.
Wal-Mart Stores, Inc. Wal-Mart Stores, Inc. operates discount stores and
Supercenters, as well as Sam's Clubs. The company's Wal-Mart discount stores and
Supercenters offer merchandise such as apparel, housewares, small appliances,
electronics, and hardware. Wal-Mart operates in the United States, Canada,
Argentina, Brazil, Germany, Mexico, and Puerto Rico, as well as joint ventures
in China and Korea.
The Walt Disney Company. The Walt Disney Company, an entertainment company,
conducts operations in media networks, studio entertainment, theme parks and
resorts, consumer products, and Internet and direct marketing. The company
produces motion pictures, television programs, and musical recordings, as well
as publishes books and magazines. Disney also operates ABC radio and television
and theme parks.
Wells Fargo & Company. Wells Fargo & Company is a diversified financial
services company providing banking, insurance, investments, mortgage, and
consumer finance. The company operates through physical stores, the Internet and
other distribution channels across North America and elsewhere internationally.
WorldCom, Inc. WorldCom, Inc. provides a broad range of communications,
outsourcing, and managed network services worldwide. The company provides long
distance, local, and wireless communications, including voice, data, Internet,
and international services.
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Board of Directors of Van Kampen Funds Inc. and the Unitholders of Van
Kampen Focus Portfolios, Series 224:
We have audited the accompanying statement of condition and the related
portfolio of Van Kampen Focus Portfolios, Series 224 as of December 12, 2000.
The statement of condition and portfolio are the responsibility of the Sponsor.
Our responsibility is to express an opinion on such financial statements based
on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of an irrevocable letter of
credit deposited to purchase securities by correspondence with the Trustee. An
audit also includes assessing the accounting principles used and significant
estimates made by the Sponsor, as well as evaluating the overall financial
statement presentation. We believe our audit provides a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Van Kampen Focus Portfolios,
Series 224 as of December 12, 2000, in conformity with accounting principles
generally accepted in the United States of America.
GRANT THORNTON LLP
Chicago, Illinois
December 12, 2000
STATEMENT OF CONDITION
AS OF DECEMBER 12, 2000
INVESTMENT IN SECURITIES
Contracts to purchase Securities (1) $ 145,990
-----------
Total $ 145,990
===========
LIABILITY AND INTEREST OF UNITHOLDERS
Liability--
Organizational costs (2) $ 327
Interest of Unitholders--
Cost to investors (3) 151,760
Less: Gross underwriting commission
and organizational costs (2)(3) 6,097
-----------
Net interest to Unitholders (3) 145,663
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Total $ 145,990
===========
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(1)The value of the Securities is determined by Interactive Data Corporation on
the bases set forth under "Public Offering--Offering Price". The contracts to
purchase Securities are collateralized by an irrevocable letter of credit
which has been deposited with the Trustee.
(2)A portion of the Public Offering Price represents an amount sufficient to
pay for all or a portion of the costs incurred in establishing the Trust. The
amount of these costs are set forth in the "Fee Table". A distribution will
be made as of the close of the initial offering period or six months after
the Initial Date of Deposit (whichever is earlier) to an account maintained
by the Trustee from which this obligation of the investors will be satisfied.
(3)The aggregate public offering price and the aggregate sales charge are
computed on the bases set forth under "Public Offering-- Offering Price".
THE TRUST
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The Trust was created under the laws of the State of New York pursuant to a
Trust Indenture and Trust Agreement (the "Trust Agreement"), dated the date of
this Prospectus (the "Initial Date of Deposit"), among Van Kampen Funds Inc., as
Sponsor, Edward D. Jones & Co., L.P. ("Edward Jones"), as Supervisor, The Bank
of New York, as Trustee, and American Portfolio Evaluation Services, a division
of Van Kampen Investment Advisory Corp., as Evaluator.
The Trust offers the opportunity to purchase Units representing proportionate
interests in a portfolio of actively traded equity securities. The Trust may be
an appropriate medium for investors who desire to participate in a portfolio of
common stocks with greater diversification than they might be able to acquire
individually.
On the Initial Date of Deposit, the Sponsor deposited delivery statements
relating to contracts for the purchase of the Securities and an irrevocable
letter of credit in the amount required for these purchases with the Trustee. In
exchange for these contracts the Trustee delivered to the Sponsor documentation
evidencing the ownership of Units of the Trust. Unless otherwise terminated as
provided in the Trust Agreement, the Trust will terminate on the Mandatory
Termination Date and any remaining Securities will be liquidated or distributed
by the Trustee within a reasonable time. As used in this Prospectus the term
"Securities" means the securities (including contracts to purchase these
securities) listed in "Portfolio" and any additional securities deposited into
the Trust.
Additional Units may be issued at any time by depositing in the Trust (i)
additional Securities, (ii) contracts to purchase Securities together with cash
or irrevocable letters of credit or (iii) cash (or a letter of credit or the
equivalent) with instructions to purchase additional Securities. As additional
Units are issued by the Trust, the aggregate value of the Securities will be
increased and the fractional undivided interest represented by each Unit will be
decreased. The Sponsor may continue to make additional deposits into the Trust
following the Initial Date of Deposit provided that the additional deposits will
be in amounts which will maintain, as nearly as practicable, the same percentage
relationship among the number of shares of each Security in the Trust's
portfolio that existed immediately prior to the subsequent deposit. Investors
may experience a dilution of their investments and a reduction in their
anticipated income because of fluctuations in the prices of the Securities
between the time of the deposit and the purchase of the Securities and because
the Trust will pay the associated brokerage or acquisition fees.
Each Unit initially offered represents an undivided interest in the Trust. To
the extent that any Units are redeemed by the Trustee or additional Units are
issued as a result of additional Securities being deposited by the Sponsor, the
fractional undivided interest in the Trust represented by each unredeemed Unit
will increase or decrease accordingly, although the actual interest in the Trust
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.
The Trust consists of (a) the Securities (including contracts for the
purchase thereof) listed under the "Portfolio" as may continue to be held from
time to time in the Trust, (b) any additional Securities acquired and held by
the Trust pursuant to the provisions of the Trust Agreement and (c) any cash
held in the related Income and Capital Accounts. Neither the Sponsor nor the
Trustee shall be liable in any way for any failure in any of the Securities.
OBJECTIVES AND SECURITIES SELECTION
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The objective of the Trust is to provide capital appreciation by investing
primarily in a portfolio of actively traded equity securities of some of the
most widely held and well-capitalized companies in the United States. We cannot
guarantee that the Trust will achieve its objective. The Securities were
selected by Edward Jones. In selecting the Securities, Edward Jones considered
the factors described under "Select Growth Trust".
Edward Jones uses the list of Securities in its independent capacity as an
investment adviser and distributes this information to various individuals and
entities. Edward Jones may recommend or effect transactions in the Securities.
This may have an adverse effect on the prices of the Securities. This also may
have an impact on the price the Trust pays for the Securities and the price
received upon Unit redemptions or Trust termination.
Edward Jones has acquired or may acquire the Securities for the Sponsor and
may benefit from doing so. Edward Jones acts as agent or principal in connection
with the purchase and sale of equity securities, including the Securities, and
may act as a market maker in the Securities. Edward Jones also issues reports
and makes recommendations on the Securities. Edward Jones's research department
may receive compensation based on commissions generated by research and/or sales
of Units.
You should note that Edward Jones applied the selection criteria to the
Securities for inclusion in the Trust prior to the Initial Date of Deposit.
After the initial selection, the Securities may no longer meet the selection
criteria. Should a Security no longer meet the selection criteria, we will
generally not remove the Security from the portfolio.
RISK FACTORS
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PRICE VOLATILITY. The Trust invests in common stocks. The value of Units will
fluctuate with the value of these stocks and may be more or less than the price
you originally paid for your Units. The market value of common stocks sometimes
moves up or down rapidly and unpredictably. Because the Trust is unmanaged, the
Trustee will not sell stocks in response to market fluctuations as is common in
managed investments. As with any investment, we cannot guarantee that the
performance of the Trust will be positive over any period of time.
DIVIDENDS. Common stocks represent ownership interests in the issuers and are
not obligations of the issuers. Accordingly, common stockholders have a right to
receive dividends only after the company has provided for payment of its
creditors, bondholders and preferred stockholders. Common stocks do not assure
dividend payments. Dividends are paid only when declared by an issuer's board of
directors and the amount of any dividend may vary over time.
CONSUMER PRODUCTS COMPANIES. The Trust includes a concentration in issuers
within the consumer goods industry. Any negative impact on this industry could
have a greater impact on the value of Units. These companies face risks due to
cyclicality of revenues and earnings, changing consumer demands, regulatory
restrictions, products liability litigation, extensive competition, foreign
tariffs, foreign exchange rates, transportation costs, the cost of raw
materials, unfunded pension fund liabilities and employee and retiree benefit
costs and financial deterioration resulting from leveraged buy-outs, takeovers
or acquisitions. Because the economic health of consumers greatly impacts these
companies, recession or tightening of consumer credit or spending could
adversely affect these issuers. All of these factors can have a negative impact
on the value of your Units.
NO FDIC GUARANTEE. An Investment in your Trust is not a deposit of any bank
and is not insured or guaranteed by the Federal Deposit Insurance Corporation or
any other government agency.
PUBLIC OFFERING
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GENERAL. Units are offered at the Public Offering Price which includes the
underlying value of the Securities, the sales charge, and cash, if any, in the
Income and Capital Accounts. The maximum sales charge assessed to each
Unitholder is 3.80% of the Public Offering Price (3.950% of the aggregate value
of the Securities). A portion of the Public Offering Price includes an amount of
Securities to pay for all or a portion of the costs incurred in establishing
your Trust, including the cost of preparing documents relating to the Trust
(such as the prospectus, trust agreement and closing documents, federal and
state registration fees, the initial fees and expenses of the Trustee and legal
and audit expenses). Beginning on December 12, 2001, the secondary market sales
charge will be 4.00%. This sales charge will reduce by 0.5% on each following
December 12 to a minimum of 2.30%. The initial offering period sales charge is
reduced as follows:
AGGREGATE
DOLLAR AMOUNT
OF UNITS PURCHASED* SALES CHARGE
--------------------- ----------------
$25,000 - $249,999 2.80%
$250,000 - $999,999 2.20
$1,000,000 or more 1.60
---------------
*The breakpoint sales charges are also applied on a Unit basis utilizing a
breakpoint equivalent in the above table of $10 per Unit and will be applied on
whichever basis is more favorable to the investor.
Any sales charge reduction is the responsibility of the selling broker,
dealer or agent.The reduced sales charge structure will also apply on all
purchases by the same person from any one dealer of units of Van
Kampen-sponsored unit investment trusts which are being offered in the initial
offering period (a) on any one day (the "Initial Purchase Date") or (b) on any
day subsequent to the Initial Purchase Date if the units purchased are of a unit
investment trust purchased on the Initial Purchase Date. In the event units of
more than one trust are purchased on the Initial Purchase Date, the aggregate
dollar amount of such purchases will be used to determine whether purchasers are
eligible for a reduced sales charge. Such aggregate dollar amount will be
divided by the public offering price per unit of each respective trust purchased
to determine the total number of units which such amount could have purchased of
each individual trust. Purchasers must then consult the applicable trust's
prospectus to determine whether the total number of units which could have been
purchased of a specific trust would have qualified for a reduced sales charge
and the amount of such reduction. To determine the applicable sales charge
reduction it is necessary to accumulate all purchases made on the Initial
Purchase Date and all purchases made in accordance with (b) above. Units
purchased in the name of the spouse of a purchaser or in the name of a child of
such purchaser ("immediate family members") will be deemed to be additional
purchases by the purchaser for the purposes of calculating the applicable sales
charge. The reduced sales charges will also be applicable to a trustee or other
fiduciary purchasing securities for one or more trust estate or fiduciary
accounts. If you purchase Units on more than one day to achieve the discounts
described in this paragraph, the discount allowed on any single day will apply
only to Units purchased on that day (a retroactive discount is not given on all
prior purchases).
During the initial offering period of the Trust offered in this prospectus
unitholders of any other Van Kampen-sponsored unit investment trusts may utilize
their redemption or termination proceeds to purchase Units of the Trust offered
in this prospectus at the Public Offering Price per Unit less 1%.
A portion of the sales charge is waived for certain accounts described in
this paragraph. Purchases by these accounts are subject only to the portion of
the sales charge that is retained by the Sponsor. Please refer to the section
called "Wrap Fee and Advisory Accounts" for additional information on these
purchases. Units may be purchased in the primary or secondary market at the
Public Offering Price less the concession the Sponsor typically allows to
brokers and dealers for purchases 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 brokerage
services, 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 spouses or children under 21 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 Prospectus,
such investors, bank trust departments, firm employees and bank holding company
officers and directors who purchase Units through this program will not receive
sales charge reductions for quantity purchases.
Employees, officers and directors (including their spouses, children,
grandchildren, parents, grandparents, siblings, mothers-in-law, fathers-in-law,
sons-in-law, daughters-in-law, and trustees, custodians or fiduciaries for the
benefit of such persons) of Van Kampen Funds Inc. and its affiliates, dealers
and their affiliates and vendors providing services to the Sponsor may purchase
Units at the Public Offering Price less the applicable dealer concession.
The minimum purchase is 200 Units but may vary by selling firm. However, in
connection with fully disclosed transactions with the Sponsor, the minimum
purchase requirement will be that number of Units set forth in the contract
between the Sponsor and the related broker or agent.
OFFERING PRICE. The Public Offering Price of Units will vary from the amounts
stated under "Summary of Essential Financial Information" in accordance with
fluctuations in the prices of the underlying Securities in the Trust. The
initial price of the Securities was determined by Interactive Data Corporation,
a firm regularly engaged in the business of evaluating, quoting or appraising
comparable securities. The Evaluator will generally determine the value of the
Securities as of the Evaluation Time on each business day and will adjust the
Public Offering Price of Units accordingly. This Public Offering Price will be
effective for all orders received prior to the Evaluation Time on each business
day. The Evaluation Time is the close of the New York Stock Exchange on each
Trust business day. Orders received by the Trustee or Sponsor for purchases,
sales or redemptions after that time, or on a day which is not a business day,
will be held until the next determination of price. The term "business day", as
used herein and under of Unitholders--Redemption of Units", excludes Saturdays,
Sundays and holidays observed by the New York Stock Exchange. The term "business
day" also excludes any day on which more than 33% of the Securities are not
traded on their principal trading exchange due to a customary business holiday
on that exchange.
The aggregate underlying value of the Securities during the initial offering
period is determined on each business day by the Evaluator in the following
manner: If the Securities are listed on a national or foreign securities
exchange or the Nasdaq Stock Market, Inc., this evaluation is generally based on
the closing sale prices on that exchange or market (unless it is determined that
these prices are inappropriate as a basis for valuation) or, if there is no
closing sale price on that exchange or market, at the closing asked prices. If
the Securities are not listed on a national or foreign securities exchange or
the Nasdaq Stock Market, Inc. or, if so listed and the principal market therefor
is other than on the exchange or market, the evaluation shall generally be based
on the current asked price on the over-the-counter market (unless it is
determined that these prices are inappropriate as a basis for evaluation). If
current asked prices are unavailable, the evaluation is generally determined (a)
on the basis of current asked prices for comparable securities, (b) by
appraising the value of the Securities on the asked side of the market or (c) by
any combination of the above. The value of any foreign securities is based on
the applicable currency exchange rate in U.S. dollars as of the Evaluation Time.
The value of the Securities for purposes of secondary market transactions and
redemptions is described under "Rights of Unitholders--Redemption of Units".
In offering the Units to the public, neither the Sponsor nor any
broker-dealers are recommending any of the individual Securities but rather the
entire pool of Securities, taken as a whole, which are represented by the Units.
UNIT DISTRIBUTION. Units will be distributed to the public by the Sponsor,
broker-dealers and others at the Public Offering Price. Units repurchased in the
secondary market, if any, may be offered by this Prospectus at the secondary
market Public Offering Price in the manner described above.
The Sponsor intends to qualify Units for sale in a number of states. Brokers,
dealers and others will be allowed a concession or agency commission in
connection with the distribution of Units during the initial offering period of
65% of the applicable sales charge.
Any discount provided to investors will be borne by the selling dealer or
agent as indicated under "General" above. For transactions involving unitholders
of other Van Kampen unit investment trusts who use their redemption or
termination proceeds to purchase Units of the Trust offered in this prospectus,
the total concession or agency commission will amount to 2.00% per Unit. For all
secondary market transactions the total concession or agency commission will
amount to 65% of the applicable sales charge. Notwithstanding anything to the
contrary herein, in no case shall the total of any concessions, agency
commissions and any additional compensation allowed or paid to any broker,
dealer or other distributor of Units with respect to any individual transaction
exceed the total sales charge applicable to such transaction. The Sponsor
reserves the right to reject, in whole or in part, any order for the purchase of
Units and to change the amount of the concession or agency commission to dealers
and others from time to time.
Broker-dealers of the Trust, banks and/or others may be eligible to
participate in a program in which such firms receive from the Sponsor a nominal
award for each of their 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 reallow to 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
persons 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 entities 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 AND OTHER COMPENSATION. The Sponsor will receive a gross sales
commission equal to the total sales charge applicable to each transaction.
Edward Jones will be allowed a concession or agency commission in connection
with the distribution of Units during the initial offering period of 3.00%. Any
sales charge discount provided to investors will be borne by the selling dealer
or agent. In addition, the Sponsor will realize a profit or loss as a result of
the difference between the price paid for the Securities by the Sponsor and the
cost of the Securities to the Trust on the Initial Date of Deposit as well as on
subsequent deposits. See "Notes to Portfolio". The Sponsor has not participated
as sole underwriter or as manager or as a member of the underwriting syndicates
or as an agent in a private placement for any of the Securities. The Sponsor may
realize profit or loss as a result of the possible fluctuations in the market
value of the Securities, since all proceeds received from purchasers of Units
are retained Edward Jones. In maintaining a secondary market, Edward Jones will
realize profits or losses in the amount of any difference between the price at
which Units are purchased and the price at which Units are resold (which price
includes the applicable sales charge) or from a redemption of repurchased Units
at a price above or below the purchase price. Cash, if any, made available to
the Sponsor prior to the date of settlement for the purchase of Units may be
used in the Sponsor's business and may be deemed to be a benefit to the Sponsor,
subject to the limitations of the Securities Exchange Act of 1934.
An affiliate of the Sponsor may have participated in a public offering of one
or more of the Securities. The Sponsor, an affiliate or their employees may have
a long or short position in these Securities. An affiliate may act as a
specialist or market marker for these Securities. An officer, director or
employee of the Sponsor or an affiliate may be an officer or director for
issuers of the Securities.
MARKET FOR UNITS. Although it is not obligated to do so, the Sponsor
currently intends to maintain a market for Units and to purchase Units at the
secondary market repurchase price (which is described under "Right of
Unitholders--Redemption of Units"). The Sponsor may discontinue purchases of
Units or discontinue purchases at this price at any time. In the event that a
secondary market is not maintained, a Unitholder will be able to dispose of
Units by tendering them to the Trustee for redemption at the Redemption Price.
See "Rights of Unitholders--Redemption of Units". Unitholders should contact
their broker to determine the best price for Units in the secondary market. The
Trustee will notify the Sponsor of any tendered of Units for redemption. If the
Sponsor's bid in the secondary market equals or exceeds the Redemption Price per
Unit, it may purchase the Units not later than the day on which Units would have
been redeemed by the Trustee. The Sponsor may sell repurchased Units at the
secondary market Public Offering Price per Unit.
RETIREMENT ACCOUNTS
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Units are available for purchase in connection with certain types of
tax-sheltered retirement plans, including Individual Retirement Accounts for the
individuals, Simplified Employee Pension Plans for employees, qualified plans
for self-employed individuals, and qualified corporate pension and profit
sharing plans for employees. The purchase of Units may be limited by the plans'
provisions and does not itself establish such plans.
WRAP FEE AND ADVISORY ACCOUNTS
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Units may be available for purchase by investors who purchase Units through
registered investment advisers, certified financial planners and registered
broker-dealers who in each case either charge periodic fees for brokerage
services, 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. You should
consult your financial professional to determine whether you can benefit from
these accounts. For these purchases you generally only pay the portion of the
sales charge that is retained by your Trust's Sponsor, Van Kampen Funds Inc.
This table illustrates the transaction fees you will pay as a percentage of the
public offering price per Unit if you purchase Units through the Underwriter in
these accounts.
Fee paid to broker on purchase 0.00%
Sponsor retention 0.80
------
Total 0.80%
======
You should consult the "Public Offering--General" section for specific
information on this and other sales charge discounts.
RIGHTS OF UNITHOLDERS
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DISTRIBUTIONS. Dividends and any net proceeds from the sale of Securities
received by a Trust will generally be distributed to Unitholders on each
Distribution Date to Unitholders of record on the preceding Record Date. These
dates appear under "Summary of Essential Financial Information". A person
becomes a Unitholder of record on the date of settlement (generally three
business days after Units are ordered). Unitholders may elect to receive
distributions in cash or to have distributions reinvested into additional Units.
You may also reinvest distributions in certain Van Kampen mutual funds. See
"Rights of Unitholders--Reinvestment Option".
Dividends received by a Trust are credited to the Income Account of the
Trust. Other receipts (e.g., capital gains, proceeds from the sale of
Securities, etc.) are credited to the Capital Account. Proceeds received on the
sale of any Securities, to the extent not used to meet redemptions of Units or
pay fees or expenses, will be distributed to Unitholders. Proceeds received from
the disposition of any Securities after a record date and prior to the following
distribution date will be held in the Capital Account and not distributed until
the next distribution date. Any distribution to Unitholders consists of each
Unitholder's pro rata share of the available cash in the Income and Capital
Accounts as of the related Record Date.
REINVESTMENT OPTION. Unitholders may have distributions automatically
reinvested in additional Units under the Automatic Reinvestment Option (to the
extent Units may be lawfully offered for sale in the state in which the
Unitholder resides). To participate in this reinvestment option, a Unitholder
must file with the Trustee a written notice of election, together with any
certificate representing Units and other documentation that the Trustee may then
require, at least five days prior to the related Record Date. A Unitholder's
election will apply to all Units owned by the Unitholder and will remain in
effect until changed by the Unitholder. If Units are unavailable for
reinvestment, distributions will be paid in cash. Purchases of additional Units
made pursuant to the reinvestment plan will be made at the net asset value for
Units as of the Evaluation Time on the Distribution Date.
In addition, under the Guaranteed Reinvestment Option Unithholders may elect
to have distributions automatically reinvested in certain Van Kampen mutual
funds (the "Reinvestment Funds"). Each Reinvestment Fund has investment
objectives which differ from those of the Trust. The prospectus relating to each
Reinvestment Fund describes its investment policies and how to begin
reinvestment. A Unitholder may obtain a prospectus for the Reinvestment Funds
from the Sponsor. Purchases of shares of a Reinvestment Fund will be made at a
net asset value computed on the Distribution Date. Unitholders with an existing
Guaranteed Reinvestment Option account (whereby a sales charge is imposed on
distribution reinvestments) may transfer their existing account into a new
account which allows purchases of Reinvestment Fund shares at net asset value.
A participant may elect to terminate his or her reinvestment plan and receive
future distributions in cash by notifying the Trustee in writing no later than
five days before a distribution date. The Sponsor, each Reinvestment Fund, and
its investment adviser shall have the right to suspend or terminate these
reinvestment plans at any time.
REDEMPTION OF UNITS. A Unitholder may redeem all or a portion of his Units by
tender to the Trustee at its Unit Investment Trust Division, 101 Barclay Street,
20th Floor, New York, New York 10286. Certificates must be tendered to the
Trustee, duly endorsed or accompanied by proper instruments of transfer with
signature guaranteed (or by providing satisfactory indemnity in connection with
lost, stolen or destroyed certificates) and by payment of applicable
governmental charges, if any. On the seventh day following the tender, the
Unitholder will be entitled to receive in cash an amount for each Unit equal to
the Redemption Price per Unit next computed 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 by the Trustee after the Evaluation
Time or on a day which is not a Trust business day, the date of tender is deemed
to be the next business day.
Unitholders tendering 2,500 or more Units of the Trust for redemption may
request an in kind distribution of Securities equal to the Redemption Price per
Unit on the date of tender. Unitholders may not request an in kind distribution
during the five business days prior to the Trust's termination. An in kind
distribution will be made by the Trustee through the distribution of each of the
Securities in book-entry form to the account of the Unitholder's broker-dealer
at Depository Trust Company. Amounts representing fractional shares will be
distributed in cash. The Trustee may adjust the number of shares of any Security
included in a Unitholder's in kind distribution to facilitate the distribution
of whole shares.
The Trustee may sell Securities to satisfy Unit redemptions. To the extent
that Securities are redeemed in kind or sold, the size of the Trust will be, and
the diversity of the Trust may be, reduced. Sales may be required at a time when
Securities would not otherwise be sold and may result in lower prices than might
otherwise be realized. The price received upon redemption may be more or less
than the amount paid by the Unitholder depending on the value of the Securities
at the time of redemption. Special federal income tax consequences will result
if a Unitholder requests an in kind distribution. See "Taxation".
The Redemption Price per Unit and the secondary market repurchase price per
Unit are equal to the pro rata share of each Unit in the Trust determined on the
basis of (i) the cash on hand in the Trust, (ii) the value of the Securities in
the Trust and (iii) dividends receivable on the Securities in the Trust trading
ex-dividend as of the date of computation, less (a) amounts representing taxes
or other governmental charges payable out of the Trust and (b) the accrued
expenses of the Trust. During the initial offering period, the redemption price
and the secondary market repurchase price will also include estimated
organizational costs. For these purposes, the Evaluator may determine the value
of the Securities in the following manner: If the Securities are listed on a
national or foreign securities exchange or the Nasdaq Stock Market, Inc., this
evaluation is generally based on the closing sale prices on that exchange or
market (unless it is determined that these prices are inappropriate as a basis
for valuation) or, if there is no closing sale price on that exchange or market,
at the closing bid prices. If the Securities are not so listed or, if so listed
and the principal market therefor is other than on the exchange or market, the
evaluation may be based on the current bid price on the over-the-counter market.
If current bid prices are unavailable or inappropriate, the evaluation may be
determined (a) on the basis of current bid prices for comparable securities, (b)
by appraising the Securities on the bid side of the market or (c) by any
combination of the above. The value of any foreign securities is based on the
applicable currency exchange rate in U.S. dollars as of the Evaluation Time.
The right of redemption may be suspended and payment postponed for any period
during which the New York Stock Exchange is closed, other than for customary
weekend and holiday closings, or any period during which the SEC determines that
trading on that Exchange is restricted or an emergency exists, as a result of
which disposal or evaluation of the Securities is not reasonably practicable, or
for other periods as the SEC may permit.
CERTIFICATES. Ownership of Units is evidenced in book-entry form unless a
Unitholder makes a written request to the Trustee that ownership be in
certificate form. Units are transferable by making a written request to the
Trustee and, in the case of Units in certificate form, by presentation of the
certificate to the Trustee properly endorsed or accompanied by a written
instrument or instruments of transfer. A Unitholder must sign the written
request, and certificate or transfer instrument, exactly as his name appears on
the records of the Trustee and on the face of any certificate with the signature
guaranteed by a participant in the Securities Transfer Agents Medallion Program
("STAMP") or a signature guarantee program accepted by the Trustee. In certain
instances the Trustee may require additional documents such as, but not limited
to, trust instruments, certificates of death, appointments as executor or
administrator or certificates of corporate authority. Fractional certificates
will not be issued. The Trustee may require a Unitholder to pay a reasonable fee
for each certificate reissued or transferred and to pay any governmental charge
that may be imposed in connection with each transfer or interchange. Destroyed,
stolen, mutilated or lost certificates will be replaced upon delivery to the
Trustee of satisfactory indemnity, evidence of ownership and payment of expenses
incurred. Mutilated certificates must be surrendered to the Trustee for
replacement.
REPORTS PROVIDED. Unitholders will receive a statement of dividends and other
amounts received by the Trust for each distribution. Within a reasonable time
after the end of each year, each person who was a Unitholder during that year
will receive a statement describing dividends and capital received, actual Trust
distributions, Trust expenses, a list of the Securities and other Trust
information. Unitholders may obtain the Evaluator's evaluations of the
Securities upon request.
TRUST ADMINISTRATION
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PORTFOLIO ADMINISTRATION. The Trust is not managed funds and, except as
provided in the Trust Agreement, Securities generally will not be sold or
replaced. The Sponsor may, however, direct that Securities be sold in certain
limited circumstances to protect the Trust based on advice from the Supervisor.
These situations may include events such as the issuer having defaulted on
payment of any of its outstanding obligations or the price of a Security has
declined to such an extent or other credit factors exist so that in the opinion
of the Sponsor retention of the Security would be detrimental to the Trust. If a
public tender offer has been made for a Security or a merger or acquisition has
been announced affecting a Security, the Trustee may either sell the Security or
accept a tender offer for cash if the Supervisor determines that the sale or
tender is in the best interest of Unitholders. The Trustee will distribute any
cash proceeds to Unitholders. In addition, the Trustee may sell Securities to
redeem Units or pay Trust expenses. The Trustee must reject any offer for
securities or property other than cash in exchange for the Securities. If
securities or property are nonetheless acquired by the Trust, the Sponsor may
direct the Trustee to sell the securities or property and distribute the
proceeds to Unitholders or to accept the securities or property for deposit in
the Trust. Should any contract for the purchase of any of the Securities fail,
the Sponsor will (unless substantially all of the moneys held in the Trust to
cover the purchase are reinvested in substitute Securities in accordance with
the Trust Agreement) refund the cash and sales charge attributable to the failed
contract to all Unitholders on or before the next distribution date.
When your Trust sells Securities, the composition and diversity of the
Securities in the Trust may be altered. In order to obtain the best price for
the Trust, it may be necessary for the Supervisor to specify minimum amounts
(generally 100 shares) in which blocks of Securities are to be sold. In
effecting purchases and sales of the Trust's portfolio securities, the Sponsor
may direct that orders be placed with and brokerage commissions be paid to
brokers, including brokers which may be affiliated with the Trust, the Sponsor
or dealers participating in the offering of Units. In addition, in selecting
among firms to handle a particular transaction, the Sponsor may take into
account whether the firm has sold or is selling units of unit investment trusts
which it sponsors.
AMENDMENT OF THE TRUST AGREEMENT. The Trustee and the Sponsor may amend the
Trust Agreement without the consent of Unitholders to correct any provision
which may be defective or to make other provisions that will not adversely
affect Unitholders (as determined in good faith by the Sponsor and the Trustee).
The Trust Agreement may not be amended to increase the number of Units or permit
acquisition of securities in addition to or substitution for the Securities
(except as provided in the Trust Agreement). The Trustee will notify Unitholders
of any amendment.
TERMINATION. The Trust will terminate on the Mandatory Termination Date or
upon the sale or other disposition of the last Security held in the Trust. The
Trust may be terminated at any time with consent of Unitholders representing
two-thirds of the outstanding Units or by the Trustee when the value of the
Trust is less than $500,000 ($3,000,000 if the value of the Trust has exceeded
$15,000,000) (the "Minimum Termination Value"). Unitholders will be notified of
any termination. The Trustee may begin to sell Securities in connection with a
Trust termination during a period beginning nine business days before, and no
later than, the Mandatory Termination Date. Approximately thirty days before
this date, the Trustee will notify Unitholders of the termination and provide a
form enabling qualified Unitholders to elect an in kind distribution of
Securities. See "Rights of Unitholders--Redemption of Units". This form must be
returned at least five business days prior to the Mandatory Termination Date.
Unitholders will receive a final cash distribution within a reasonable time
after the Mandatory Termination Date. All distributions will be net of Trust
expenses and costs. Unitholders will receive a final distribution statement
following termination. The Information Supplement contains further information
regarding termination of the Trust. See "Additional Information".
LIMITATIONS ON LIABILITIES. The Sponsor, Evaluator, Supervisor and Trustee
are under no liability for taking any action or for refraining from taking any
action in good faith pursuant to the Trust Agreement, or for errors in judgment,
but shall be liable only for their own willful misfeasance, bad faith or gross
negligence (negligence in the case of the Trustee) in the performance of their
duties or by reason of their reckless disregard of their obligations and duties
hereunder. The Trustee is not be liable for depreciation or loss incurred by
reason of the sale by the Trustee of any of the Securities. In the event of the
failure of the Sponsor to act under the Trust Agreement, the Trustee may act
thereunder and is not be liable for any action taken by it in good faith under
the Trust Agreement. The Trustee is not liable for any taxes or other
governmental charges imposed on the Securities, on it as Trustee under the Trust
Agreement or on the Trust which the Trustee may be required to pay under any
present or future law of the United States of America or of any other taxing
authority having jurisdiction. In addition, the Trust Agreement contains other
customary provisions limiting the liability of the Trustee. The Trustee, Sponsor
and Supervisor may rely on any evaluation furnished by the Evaluator and have no
responsibility for the accuracy thereof. Determinations by the Evaluator shall
be made in good faith upon the basis of the best information available to it.
SPONSOR. Van Kampen Funds Inc., a Delaware corporation, is the Sponsor of the
Trust. The Sponsor is an indirect subsidiary of Morgan Stanley Dean Witter & Co.
Van Kampen Funds Inc. specializes in the underwriting and distribution of unit
investment trusts and mutual funds with roots in money management dating back to
1926. The Sponsor is a member of the National Association of Securities Dealers,
Inc. and has its principal office at 1 Parkview Plaza, P.O. Box 5555, Oakbrook
Terrace, Illinois 60181-5555, (630) 684-6000. As of November 30, 1999, the total
stockholders' equity of Van Kampen Funds Inc. was $141,554,861 (audited). Van
Kampen Funds Inc. and your Portfolio have adopted a code of ethics requiring Van
Kampen's employees who have access to information on Portfolio transactions to
report personal securities transactions. The purpose of the code is to avoid
potential conflicts of interest and to prevent fraud, deception or misconduct
with respect to your Portfolio. The Information Supplement contains additional
information about the Sponsor.
If the Sponsor shall fail to perform any of its duties under the Trust
Agreement or become incapable of acting or shall become bankrupt or its affairs
are taken over by public authorities, then the Trustee may (i) appoint a
successor Sponsor at rates of compensation deemed by the Trustee to be
reasonable and not exceeding amounts prescribed by the Securities and Exchange
Commission, (ii) terminate the Trust Agreement and liquidate the Trust as
provided therein or (iii) continue to act as Trustee without terminating the
Trust Agreement.
TRUSTEE. The Trustee is The Bank of New York, a trust company organized under
the laws of New York. The Bank of New York has its unit investment trust
division offices at 101 Barclay Street, New York, New York 10286 (800) 221-7668.
The Bank of New York is subject to supervision and examination by the
Superintendent of Banks of the State of New York and the Board of Governors of
the Federal Reserve System, and its deposits are insured by the Federal Deposit
Insurance Corporation to the extent permitted by law. Additional information
regarding the Trustee is set forth in the Information Supplement, including the
Trustee's qualifications and duties, its ability to resign, the effect of a
merger involving the Trustee and the Sponsor's ability to remove and replace the
Trustee. See "Additional Information".
PERFORMANCE INFORMATION. The Sponsor may from time to time in its advertising
and sales materials compare the then current estimated returns on the Trust and
returns over specified time periods on other similar trusts (which may show
performance net of expenses and charges which the Trust would have charged) with
returns on other taxable investments such as the common stocks comprising the
Dow Jones Industrial Average, the S&P 500, other investment indices, corporate
or U.S. government bonds, bank CDs, money market accounts or money market funds,
or with performance data from Lipper Analytical Services, Inc., Morningstar
Publications, Inc. or various publications, each of which has characteristics
that may differ from those of the Trust. Information on percentage changes in
the dollar value of Units may be included from time to time in advertisements,
sales literature, reports and other information furnished to current or
prospective Unitholders. Total return figures may not be averaged and may not
reflect deduction of the sales charge, which would decrease return. No provision
is made for any income taxes payable. Past performance may not be indicative of
future results. The Trust portfolio is not managed and Unit price and return
fluctuate with the value of common stocks in the portfolios, so there may be a
gain or loss when Units are sold. As with other performance data, performance
comparisons should not be considered representative of the Trust's relative
performance for any future period.
TAXATION
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The following is a general discussion of certain of the federal income tax
consequences of the purchase, ownership and disposition of the Units of your
Trust. The summary is limited to investors who hold the Units as "capital
assets" (generally, property held for investment within the meaning of Section
1221 of the Internal Revenue Code of 1986 (the "Code")). Unitholders should
consult their tax advisers in determining the federal, state, local and any
other tax consequences of the purchase, ownership and disposition of Units in
the Trust. For purposes of the following discussion and opinion, it is assumed
that each Security in the Trust is equity for federal income tax purposes.
In the opinion of Chapman and Cutler, special counsel for the Sponsor, under
existing law:
1. The Trust is not an association taxable as a corporation for federal
income tax purposes; each Unitholder will be treated as the owner of a pro rata
portion of each of the assets of the Trust under the Code; and the income of the
Trust will be treated as income of the Unitholders thereof under the Code. Each
Unitholder will be considered to have received his pro rata share of income
derived from each Security asset when such income is considered to be received
by the Trust.
2. Each Unitholder will have a taxable event when the Trust disposes of a
Security (whether by sale, exchange, liquidation, redemption, or otherwise) or
upon the sale or redemption of Units by such Unitholder (except to the extent an
in kind distribution of stock is received by such Unitholder as described
below). The price a Unitholder pays for his Units, generally including sales
charges, is allocated among his pro rata portion of each Security held by the
Trust (in proportion to the fair market values thereof on the valuation date
nearest the date the Unitholder purchase his Units) in order to determine his
initial tax basis for his pro rata portion of each Security held by the Trust.
Unitholders should consult their own tax advisers with regard to calculation of
basis. For federal income tax purposes, a Unitholder's pro rata portion of
dividends as defined by Section 316 of the Code paid by a corporation with
respect to a Security held by the Trust are taxable as ordinary income to the
extent of such corporation's current and accumulated "earnings and profits". A
Unitholder's pro rata portion of dividends paid on such Security which exceeds
such current and accumulated earnings and profits will first reduce a
Unitholder's tax basis in such Security, and to the extent that such dividends
exceed a Unitholder's tax basis in such Equity Security shall generally be
treated as capital gain. In general, the holding period for such capital gain
will be determined by the period of time a Unitholder has held his Units.
3. A Unitholder's portion of gain, if any, upon the sale or redemption of
Units or the disposition of Securities held by the Trust will generally be
considered a capital gain, except in the case of a dealer or a financial
institution. 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 (except in the case of a dealer or a financial
institution). Unitholders should consult their tax advisers regarding the
recognition of such capital gains and losses for federal income tax purposes.
DIVIDENDS RECEIVED DEDUCTION. A Unitholder will be considered to have
received all of the dividends paid on his pro rata portion of each Security when
such dividends are received by the Trust. Unitholders will be taxed in this
manner regardless of whether distributions from the Trust are actually received
by the Unitholder or are automatically reinvested. A corporation that owns Units
will generally be entitled to a 70% dividends received deduction with respect to
such Unitholder's pro rata portion of dividends received by the Trust (to the
extent such dividends are taxable as ordinary income, as discussed above, and
are attributable to domestic corporations) in the same manner as if such
corporation directly owned the Securities paying such dividends (other than
corporate Unitholders, such as "S" corporations, which are not eligible for the
deduction because of their special characteristics and other than for purposes
of special taxes such as the accumulated earnings tax and the personal holding
corporation tax). However, a corporation owning Units should be aware that
Sections 246 and 246A of the Code impose additional limitations on the
eligibility of dividends for the 70% dividends received deduction. These
limitations include a requirement that stock (and therefore Units) must
generally be held at least 46 days (as determined under Section 246(c) of the
Code). Final regulations have been issued which address special rules that must
be considered in determining whether the 46 day holding requirement is met.
Moreover, the allowable percentage of the deduction will be reduced from 70% if
a corporate Unitholder owns certain stock (or Units) the financing of which is
directly attributable to indebtedness incurred by such corporation. To the
extent dividends received by the Trust are attributable to foreign corporations,
a corporation that owns Units will not be entitled to the dividends received
deduction with respect to its pro rata portion of such dividends, since the
dividends received deduction is generally available only with respect to
dividends paid by domestic corporations. Unitholders should consult with their
tax advisers with respect to the limitations on and possible modifications to
the dividends received deduction.
LIMITATIONS ON DEDUCTIBILITY OF TRUST EXPENSES BY UNITHOLDERS. Each
Unitholder's pro rata share of each expense paid by the Trust is deductible by
the Unitholder to the same extent as though the expense had been paid directly
by him. It should be noted that as a result of the Tax Reform Act of 1986,
certain miscellaneous itemized deductions, such as investment expenses, tax
return preparation fees and employee business expenses will be deductible by an
individual only to the extent they exceed 2% of such individual's adjusted gross
income. Unitholders may be required to treat some or all of the expenses of the
Trust as miscellaneous itemized deductions subject to this limitation.
Unitholders should consult with their own tax advisers regarding the
deductibility of Trust expenses.
RECOGNITION OF TAXABLE GAIN OR LOSS UPON DISPOSITION OF SECURITIES BY THE
TRUST OR DISPOSITION OF UNITS. As discussed above, a Unitholder may recognize
taxable gain (or loss) when a Security is disposed of by the Trust or if the
Unitholder disposes of a Unit. The Internal Revenue Service Restructing and
Reform Act of 1998 (the "1998 Tax Act") provides that for taxpayers other than
corporations, net capital gain (which is defined as net long-term capital gain
over net short-term capital loss for the taxable year) realized from property
(with certain exclusions) is subject to a maximum marginal stated tax rate of
20% (10% in the case of certain taxpayers in the lowest tax bracket). Capital
gain or loss is long-term if the holding period for the asset is more than one
year, and is short-term if the holding period for the asset is one year or less.
The date on which a Unit is acquired (i.e., the "trade date") is excluded for
purposes of determining the holding period of the Unit. Capital gains realized
from assets held for one year or less are taxed at the same rates as ordinary
income.
For tax years beginning after December 31, 2000, the 20% rate is reduced to
18% and the 10% rate is reduced to 8% for long-term gains from most property
held for more than five years. However, the reduction of the 20% to 18% applies
only if the holding period for the property begins after December 31, 2000.
Therefore, you will not be eligible for the 18% capital gain rate on assets for
which your holding period began before January 1, 2001. However, if you are an
individual, you may elect to treat certain assets you hold on January 1, 2001 as
having been sold for their fair market value on the next business day after
January 1, 2001 for purposes of this holding period requirement. If you make
this election for an asset, the asset would be eligible for the 18% rate if it
is held by you for more than five years after this deemed sale. If you make this
election, you must recognize any gain from this deemed sale, but any loss is not
recognized.
In addition, please note that capital gains may be recharacterized as
ordinary income in the case of certain financial transactions that are
considered "conversion transactions" effective for transactions entered into
after April 30, 1993. Unitholders and prospective investors should consult with
their tax advisers regarding the potential effect of this provision on their
investment in Units.
If a Unitholder disposes of a Unit he is deemed thereby to have disposed of
his entire pro rata interest in all assets of the Trust including his pro rata
portion of all Securities represented by a Unit.
The Taxpayer Relief Act of 1997 (the "1997 Tax Act") includes provisions that
treat certain transactions designed to reduce or eliminate risk of loss and
opportunities for gain (e.g., short sales, offsetting notional principal
contracts, futures or forward contracts or similar transactions) as constructive
sales for purposes of recognition of gain (but not of loss) and for purposes of
determining the holding period. Unitholders should consult their own tax
advisers with regard to any such constructive sales rules.
SPECIAL TAX CONSEQUENCES OF IN KIND DISTRIBUTIONS UPON REDEMPTION OF UNITS OR
TERMINATION OF THE TRUST. As discussed in "Rights of Unitholders--Redemption of
Units", under certain circumstances a Unitholder tendering Units for redemption
may request an in kind distribution. A Unitholder may also under certain
circumstances request an in kind distribution upon the termination of the Trust.
See "Rights of Unitholders--Redemption of Units. As previously discussed, prior
to the redemption of Units or the termination of the Trust, a Unitholder is
considered as owning a pro rata portion of each of the Trust's assets for
federal income tax purposes. The receipt of an in kind distribution will result
in a Unitholder receiving whole shares of stock plus, possibly, cash.
The potential tax consequences that may occur under an in kind distribution
with respect to each Security held by the Trust will depend on whether or not a
Unitholder receives cash in addition to Securities. A "Security" for this
purpose is a particular class of stock issued by a particular corporation. A
Unitholder will not recognize gain or loss if a Unitholder only receives
Securities in exchange for his or her pro rata portion in the Securities held by
the Trust. However, if a Unitholder also receives cash in exchange for a
fractional share of such Security held by the Trust, such Unitholder will
generally recognize gain or loss based upon the difference between the amount of
cash received by the Unitholder and his tax basis in such fractional share of a
Security held by the Trust.
Because the Trust will own many Securities, a Unitholder who requests an in
kind distribution will have to analyze the tax consequences with respect to each
Security owned by the Trust. The amount of taxable gain (or loss) recognized
upon such exchange will generally equal the sum of the gain (or loss) recognized
under the rules described above by such Unitholder with respect to each Security
owned by the Trust. Unitholders who request an in kind distribution are advised
to consult their tax advisers in this regard.
COMPUTATION OF THE UNITHOLDER'S TAX BASIS. Initially, a Unitholder's tax
basis in his Units will generally equal the price paid by such Unitholder of his
Units. The cost of the Units is allocated among the Securities held in the Trust
in accordance with the proportion of the fair market values of such Securities
on the valuation date nearest the date the Units are purchased in order to
determine such Unitholder's tax basis for his pro rata portion of each Security.
A Unitholder's tax basis in his Units and his pro rata portion of a Security
held by the Trust will be reduced to the extent dividends paid with respect to
such Security are received by the Trust which are not taxable as ordinary income
as described above.
GENERAL. Each Unitholder will be requested to provide the Unitholder's
taxpayer identification number to the Trustee and to certify that the Unitholder
has not been notified that payments to the Unitholder are subject to back-up
withholding. If the proper taxpayer identification number and appropriate
certification are not provided when requested, distributions by the Trust to
such Unitholder (including amounts received upon the redemption of Units) will
be subject to back-up withholding. Distributions by the Trust (other than those
that are not treated as United States source income, if any) will generally be
subject to United States income taxation and withholding in the case of Units
held by non-resident alien individuals, foreign corporations or other non-United
States persons. Such persons should consult their tax advisers.
In general, income that is not effectively connected to the conduct of a
trade or business within the United States that is earned by non-U.S.
Unitholders and derived from dividends of foreign corporations will not be
subject to U.S. withholding tax provided that less than 25 percent of the gross
income of the foreign corporations for a three-year period ending with the close
of its taxable year preceding payment was effectively connected to the conduct
of a trade or business within the United States. In addition, such earnings may
be exempt from U.S. withholding pursuant to a specific treaty between the United
States and a foreign country. Non-U.S. Unitholders should consult their own tax
advisers regarding the imposition of U.S. withholding on distributions from the
Trust.
It should be noted that payments to the Trust of dividends on Securities that
are attributable to foreign corporations may be subject to foreign withholding
taxes and Unitholders should consult their tax advisers regarding the potential
tax consequences relating to the payment of any such withholding taxes by the
Trust. Any dividends withheld as a result thereof will nevertheless be treated
as income to the Unitholders. Because, under the grantor trust rules, an
investor is deemed to have paid directly his share of foreign taxes that have
been paid or accrued, if any, an investor may be entitled to a foreign tax
credit or deduction for United States tax purposes with respect to such taxes.
The 1997 Tax Act imposes a required holding period for such credits. Investors
should consult their tax advisers with respect to foreign withholding taxes and
foreign tax credits.
At the termination of the Trust, the Trustee will furnish to each Unitholder
of the Trust a 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 (resulting from redemption or the
sale of any Security), and the fees and expenses paid by the Trust. The Trustee
will also furnish annual information returns to Unitholders and to the Internal
Revenue Service.
In the opinion of special counsel to the Trust for New York tax matters, the
Trust is not an association taxable as a corporation and the income of the Trust
will be treated as the income of the Unitholders under the existing income tax
laws of the State and City of New York.
The foregoing discussion relates only to the tax treatment of U.S.
Unitholders ("U.S. Unitholders") with regard to federal and certain aspects of
New York State and City income taxes. Unitholders may be subject to taxation in
New York or in other jurisdictions and should consult their own tax advisers in
this regard. As used herein, the term "U.S. Unitholder" means an owner of a Unit
of the Trust that (a) is (i) for United States federal income tax purposes a
citizen or resident of the United States, (ii) a corporation, partnership or
other entity created or organized in or under the laws of the United States or
of any political subdivision thereof, or (iii) an estate or trust the income of
which is subject to United States federal income taxation regardless of its
source or (b) does not qualify as a U.S. Unitholder in paragraph (a) but whose
income from a Unit is effectively connected with such Unitholder's conduct of a
United States trade or business. The term also includes certain former citizens
of the United States whose income and gain on the Units will be taxable.
Unitholders should consult their tax advisers regarding potential foreign, state
or local taxation with respect to the Units.
TRUST OPERATING EXPENSES
--------------------------------------------------------------------------------
GENERAL. The fees and expenses of the Trust will accrue on a daily basis. The
deferred sales charge, fees and expenses are generally paid out of the Capital
Account of the Trust. When these amounts are paid by or owing to the Trustee,
they are secured by a lien on the Trust. It is expected that Securities will be
sold to pay these amounts which will result in capital gains or losses to
Unitholders. See "Taxation". The Supervisor's, Evaluator's and Trustee's fees
may be increased without approval of the Unitholders by amounts not exceeding
proportionate increases under the category "All Services Less Rent of Shelter"
in the Consumer Price Index or, if this category is not published, in a
comparable category.
ORGANIZATION COSTS. You and the other Unitholders will bear all or a portion
of the organization costs and charges incurred in connection with the
establishment of the Trust. These costs and charges will include the cost of the
preparation, printing and execution of the trust agreement, registration
statement and other documents relating to the Trust, federal and state
registration fees and costs, the initial fees and expenses of the Trustee and
legal and auditing expenses. The public offering price of Units includes the
estimated amount of these costs. The Trustee will deduct these expenses from the
Trust's assets at the end of the initial offering period.
TRUSTEE'S FEE. For its services the Trustee will receive the fee from the
Trust set forth in the "Fee Table" (which includes the estimated amount of
miscellaneous Trust expenses). The Trustee benefits to the extent there are
funds in the Capital and Income Accounts since these Accounts are non-interest
bearing to Unitholders and the amounts earned by the Trustee are retained by the
Trustee. Part of the Trustee's compensation for its services to the Trust is
expected to result from the use of these funds.
COMPENSATION OF SPONSOR, SUPERVISOR AND EVALUATOR. The Evaluator, which is an
affiliate of the Sponsor, will receive the annual fee for portfolio evaluation
services set forth in the "Fee Table". The Supervisor will receive the annual
fee for portfolio supervisory services set forth in the "Fee Table". These fees
may exceed the actual costs of providing these services to the Trust but at no
time will the total amount received for supervisory and evaluation services
rendered to all Van Kampen unit investment trusts in any calendar year exceed
the aggregate cost of providing these services in that year.
MISCELLANEOUS EXPENSES. The following additional charges are or may be
incurred by the Trust: (a) normal expenses (including the cost of mailing
reports to Unitholders) incurred in connection with the operation of the Trust,
(b) fees of the Trustee for extraordinary services, (c) expenses of the Trustee
(including legal and auditing expenses) and of counsel designated by the
Sponsor, (d) various governmental charges, (e) expenses and costs of any action
taken by the Trustee to protect the Trust and the rights and interests of
Unitholders, (f) indemnification of the Trustee for any loss, liability or
expenses incurred in the administration of the Trust without negligence, bad
faith or wilful misconduct on its part, (g) foreign custodial and transaction
fees, (h) costs associated with liquidating the securities held in the Trust,
(i) any offering costs incurred after the end of the initial offering period and
(j) expenditures incurred in contacting Unitholders upon termination of the
Trust.
OTHER MATTERS
--------------------------------------------------------------------------------
LEGAL OPINIONS. The legality of the Units offered hereby has been passed upon
by Chapman and Cutler, 111 West Monroe Street, Chicago, Illinois 60603, as
counsel for the Sponsor. Winston & Strawn has acted as counsel to the Trustee
and as special counsel for New York tax matters.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS. The statement of condition and the
related portfolio included in this Prospectus have been audited by Grant
Thornton LLP, independent certified public accountants, as set forth in their
report in this Prospectus, and are included herein in reliance upon the
authority of said firm as experts in accounting and auditing.
ADDITIONAL INFORMATION
--------------------------------------------------------------------------------
This Prospectus does not contain all the information set forth in the
Registration Statement filed by the Trust with the SEC. The Information
Supplement, which has been filed with the SEC, includes more detailed
information concerning the Securities, investment risks and general information
about the Trust. Information about your Trust (including the Information
Supplement) can be reviewed and copied at the SEC's Public Reference Room in
Washington, D.C. You may obtain information about the Public Reference Room by
calling 1-202-942-8090. Reports and other information about your Trust are
available on the EDGAR Database on the SEC's Internet site at
http://www.sec.gov. Copies of this information may be obtained, after paying a
duplication fee, by electronic request at the following e-mail address:
[email protected] or by writing the SEC's Public Reference Section, Washington,
D.C. 20549-0102.
TABLE OF CONTENTS
TITLE PAGE
----- ----
Summary of Essential Financial Information.. 2
Fee Table................................... 3
Select Growth Trust......................... 4
Notes to Portfolio.......................... 7
The Securities.............................. 8
Report of Independent Certified
Public Accountants....................... 13
Statement of Condition ..................... 14
The Trust................................... A-1
Objectives and Securities Selection......... A-1
Risk Factors................................ A-2
Public Offering............................. A-2
Retirement Accounts......................... A-6
Wrap Fee and Advisory Accounts.............. A-6
Rights of Unitholders....................... A-6
Trust Administration........................ A-8
Taxation.................................... A-10
Trust Operating Expenses.................... A-14
Other Matters............................... A-15
Additional Information...................... A-15
EMSPRO224
#3096
PROSPECTUS
--------------------------------------------------------------------------------
DECEMBER 12, 2000
VAN KAMPEN
FOCUS PORTFOLIOS(SM)
A DIVISION OF VAN KAMPEN FUNDS INC.
SELECT GROWTH TRUST,
DECEMBER 2000 SERIES
VAN KAMPEN FUNDS INC.
1 Parkview Plaza
P.O. Box 5555
Oakbrook Terrace, Illinois 60181-5555
Please retain this prospectus for future reference.
INFORMATION SUPPLEMENT
VAN KAMPEN FOCUS PORTFOLIOS, SERIES 224
--------------------------------------------------------------------------------
This Information Supplement provides additional information concerning the
risks and operations of the Trust which is not described in the Prospectus. This
Information Supplement should be read in conjunction with the Prospectus. This
Information Supplement is not a prospectus, does not include all of the
information that an investor should consider before investing in the Trust and
may not be used to offer or sell Units without the Prospectus. Copies of the
Prospectus can be obtained by contacting the Sponsor at 1 Parkview Plaza, P.O.
Box 5555, Oakbrook Terrace, Illinois 60181-5555 or by contacting your broker.
This Information Supplement is dated as of the date of the Prospectus and all
capitalized terms have been defined in the Prospectus.
TABLE OF CONTENTS
PAGE
Risk Factors 2
The Trust 3
Sponsor Information 3
Trustee Information 4
Trust Termination 5
RISK FACTORS
PRICE VOLATILITY. Because the Trust invests in common stocks, you should
understand the risks of investing in common stocks before purchasing Units.
These risks include the risk that the financial condition of the company or the
general condition of the stock market may worsen and the value of the stocks
(and therefore Units) will fall. Common stocks are especially susceptible to
general stock market movements. The value of common stocks often rises or falls
rapidly and unpredictably as market confidence and perceptions of companies
change. These perceptions are based on factors including expectations regarding
government economic policies, inflation, interest rates, economic expansion or
contraction, political climates and economic or banking crises. The value of
Units will fluctuate with the value of the stocks in the Trust and may be more
or less than the price you originally paid for your Units. As with any
investment, we cannot guarantee that the performance of the Trust will be
positive over any period of time. Because the Trust is unmanaged, the Trustee
will not sell stocks in response to market fluctuations as is common in managed
investments.
DIVIDENDS. Common stocks represent ownership interests in a company and are
not obligations of the company. Accordingly, common stockholders have a right to
receive payments from the company that is subordinate to the rights of
creditors, bondholders or preferred stockholders of the company. This means that
common stockholders have a right to receive dividends only if a company's board
of directors declares a dividend and the company has provided for payment of all
of its creditors, bondholders and preferred stockholders. If a company issues
additional debt securities or preferred stock, the owners of these securities
will have a claim against the company's assets before common stockholders if the
company declares bankruptcy or liquidates its assets even though the common
stock was issued first. As a result, the company may be less willing or able to
declare or pay dividends on its common stock.
CONSUMER PRODUCT AND RETAIL ISSUERS. The Portfolio invests significantly in
issuers that manufacture or sell consumer products. The profitability of these
companies will be affected by various factors including the general state of the
economy and consumer spending trends. In the past, there have been major changes
in the retail environment due to the declaration of bankruptcy by some of the
major corporations involved in the retail industry, particularly the department
store segment. The continued viability of the retail industry will depend on the
industry's ability to adapt and to compete in changing economic and social
conditions, to attract and retain capable management, and to finance expansion.
Weakness in the banking or real estate industry, a recessionary economic climate
with the consequent slowdown in employment growth, less favorable trends in
unemployment or a marked deceleration in real disposable personal income growth
could result in significant pressure on both consumer wealth and consumer
confidence, adversely affecting consumer spending habits. In addition,
competitiveness of the retail industry will require large capital outlays for
investment in the installation of automated checkout equipment to control
inventory, to track the sale of individual items and to gauge the success of
sales campaigns. Increasing employee and retiree benefit costs may also have an
adverse effect on the industry. In many sectors of the retail industry,
competition may be fierce due to market saturation, converging consumer tastes
and other factors. Because of these factors and the recent increase in trade
opportunities with other countries, American retailers are now entering global
markets which entail added risks such as sudden weakening of foreign economies,
difficulty in adapting to local conditions and constraints and added research
costs.
LIQUIDITY. Whether or not the stocks in the Trust are listed on a stock
exchange, the stocks may delist from the exchange or principally trade in an
over-the-counter market. As a result, the existence of a liquid trading market
could depend on whether dealers will make a market in the stocks. We cannot
guarantee that dealers will maintain a market or that any market will be liquid.
The value of the stocks could fall if trading markets are limited or absent.
ADDITIONAL UNITS. The Sponsor may create additional Units of the Trust by
depositing into the Trust additional stocks or cash with instructions to
purchase additional stocks. A cash deposit could result in a dilution of your
investment and anticipated income because of fluctuations in the price of the
stocks between the time of the deposit and the purchase of the stocks and
because the Trust will pay brokerage fees.
VOTING. Only the Trustee may sell or vote the stocks in the Trust. While
you may sell or redeem your Units, you may not sell or vote the stocks in the
Trust. The Sponsor will instruct the Trustee how to vote the stocks. The Trustee
will vote the stocks in the same general proportion as shares held by other
shareholders if the Sponsor fails to provide instructions.
THE TRUST
Investing in common stocks may provide the potential for capital
appreciation and dividend income. Common stocks have historically outperformed
other investments over time. For example, one dollar invested in 1926 in the
common stocks included in the Standard & Poor's 500 Index, long-term U.S.
government bonds and U.S. Treasury bills would have grown to $2,910.86, $43.77
and $15.85, respectively, by March 31, 2000. Over the same time period, one
dollar growing at the rate of inflation would have grown to $9.52.
These figures do not take into consideration taxes or any sales charges,
commissions or fees that an investor would incur in connection with these
investments. The S&P 500 Index measures the performance of 500 stocks from 83
industrial groups. U.S. government bonds are considered long-term investments
and are subject to price fluctuations. The value of long-term bonds decline as
interest rates rise. Stock indices are unmanaged, statistical composites and do
not include payment of any sales charges or fees an investor would pay to
purchase the securities they represent. Furthermore, and investment cannot be
made in an index. U.S. Treasury bills are short-term obligations of the U.S.
government that are purchased at a discount and mature at face value. U.S.
government securities are backed by the full faith and credit of the government.
The Consumer Price Index is a statistical measure of the annual rate of
inflation; it is not an investment. The historical performance is shown for
illustrative purposes only; it is not meant to forecast, imply or guarantee the
future performance of any particular investment vehicle or the Trust. Securities
in which the Trust invests will be different from those in these indices. Common
stocks involve greater risks than government bonds and CDs, as they are more
volatile and have grater potential for loss of principal.
When reviewing any historical performance information, you should keep in
mind that past performance cannot guarantee future results. Many stocks,
especially those issued by technology companies, have exhibited above-average
price appreciation and extreme volatility in recent years during a period of a
generally rising stock market. No one can assure you that this will continue or
that the performance of stocks will replicate the performance exhibited in the
past.
SPONSOR INFORMATION
Van Kampen Funds Inc., a Delaware corporation, is the Sponsor of your
Portfolio. The Sponsor is an indirect subsidiary of Van Kampen Investments Inc.
Van Kampen Investments Inc. is a wholly owned subsidiary of MSAM Holdings II,
Inc., which in turn is a wholly owned subsidiary of Morgan Stanley Dean Witter &
Co.
Morgan Stanley Dean Witter & Co., together with various of its directly and
indirectly owned subsidiaries, is engaged in a wide range of financial services
through three primary businesses: securities, asset management and credit
services. These principal businesses include securities underwriting,
distribution and trading; merger, acquisition, restructuring and other corporate
finance advisory activities; merchant banking; stock brokerage and research
services; credit services; asset management; trading of futures, options,
foreign exchange commodities and swaps (involving foreign exchange, commodities,
indices and interest rates); and real estate advice, financing and investing.
Van Kampen Funds Inc. specializes in the underwriting and distribution of
unit investment trusts and mutual funds with roots in money management dating
back to 1926. The Sponsor is a member of the National Association of Securities
Dealers, Inc. and has its principal offices at 1 Parkview Plaza, P.O. Box 5555,
Oakbrook Terrace, Illinois 60181-5555, (630) 684-6000. As of November 30, 1999,
the total stockholders' equity of Van Kampen Funds Inc. was $141,554,861
(audited). (This paragraph relates only to the Sponsor and not to the Trust or
to any other Series thereof. The information is included herein only for the
purpose of informing investors as to the financial responsibility of the Sponsor
and its ability to carry out its contractual obligations. More detailed
financial information will be made available by the Sponsor upon request.)
As of September 30, 2000, the Sponsor and its Van Kampen affiliates managed
or supervised more than $100 billion of investment products. The Sponsor and its
Van Kampen affiliates offer more than 50 open-end mutual funds, 37 closed-end
funds and have sponsored over 2,700 series of fixed income and equity unit
investment trusts.
If the Sponsor shall fail to perform any of its duties under the Trust
Agreement or become incapable of acting or shall become bankrupt or its affairs
are taken over by public authorities, then the Trustee may (i) appoint a
successor Sponsor at rates of compensation deemed by the Trustee to be
reasonable and not exceeding amounts prescribed by the Securities and Exchange
Commission, (ii) terminate the Trust Agreement and liquidate the Trust as
provided therein or (iii) continue to act as Trustee without terminating the
Trust Agreement.
TRUSTEE INFORMATION
The Trustee is The Bank of New York, a trust company organized under the
laws of New York. The Bank of New York has its unit investment trust division
offices at 101 Barclay Street, New York, New York 10286 (800) 221-7668. The Bank
of New York is subject to supervision and examination by the Superintendent of
Banks of the State of New York and the Board of Governors of the Federal Reserve
System, and its deposits are insured by the Federal Deposit Insurance
Corporation to the extent permitted by law.
The duties of the Trustee are primarily ministerial in nature. It did not
participate in the selection of Securities for the Trust portfolio.
In accordance with the Trust Agreement, the Trustee shall keep proper books
of record and account of all transactions at its office for the Trust. Such
records shall include the name and address of, and the number of Units of the
Trust held by, every Unitholder. Such books and records shall be open to
inspection by any Unitholder at all reasonable times during the usual business
hours. The Trustee shall make such annual or other reports as may from time to
time be required under any applicable state or federal statute, rule or
regulation. The Trustee is required to keep a certified copy or duplicate
original of the Trust Agreement on file in its office available for inspection
at all reasonable times during the usual business hours by any Unitholder,
together with a current list of the Securities held in the Trust.
Under the Trust Agreement, the Trustee or any successor trustee may resign
and be discharged of its responsibilities created by the Trust Agreement by
executing an instrument in writing and filing the same with the Sponsor. The
Trustee or successor trustee must mail a copy of the notice of resignation to
all Unitholders then of record, not less than 60 days before the date specified
in such notice when such resignation is to take effect. The Sponsor upon
receiving notice of such resignation is obligated to appoint a successor trustee
promptly. If, upon such resignation, no successor trustee has been appointed and
has accepted the appointment within 30 days after notification, the retiring
Trustee may apply to a court of competent jurisdiction for the appointment of a
successor. The Sponsor may remove the Trustee and appoint a successor trustee as
provided in the Trust Agreement at any time with or without cause. Notice of
such removal and appointment shall be mailed to each Unitholder by the Sponsor.
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. The resignation or removal of a Trustee becomes
effective only when the successor trustee accepts its appointment as such or
when a court of competent jurisdiction appoints a successor trustee.
Any corporation into which a Trustee may be merged or with which it may be
consolidated, or any corporation resulting from any merger or consolidation to
which a Trustee shall be a party, shall be the successor trustee. The Trustee
must be a banking corporation organized under the laws of the United States or
any state and having at all times an aggregate capital, surplus and undivided
profits of not less than $5,000,000.
TRUST TERMINATION
The Trust may be liquidated at any time by consent of Unitholders
representing 66 2/3% of the Units of such Trust then outstanding or by the
Trustee when the value of the Securities owned by the Trust, as shown by any
evaluation, is less than $500,000 ($3,000,000 if the value of the Trust has
exceeded $15,000,000). The Trust will be liquidated by the Trustee in the event
that a sufficient number of Units of the Trust not yet sold are tendered for
redemption by the Sponsor, so that the net worth of such Trust would be reduced
to less than 40% of the value of the Securities at the time they were deposited
in the Trust. If the Trust is liquidated because of the redemption of unsold
Units by the Sponsor, the Sponsor will refund to each purchaser of Units the
entire sales charge paid by such purchaser. The Trust Agreement will terminate
upon the sale or other disposition of the last Security held thereunder, but in
no event will it continue beyond the Mandatory Termination Date.
Commencing during the period beginning nine business days prior to, and no
later than, the Mandatory Termination Date, Securities may begin to be sold in
connection with the termination of the Trust. The Sponsor will determine the
manner, timing and execution of the sales of the Securities. The Sponsor shall
direct the liquidation of the Securities in such manner as to effectuate orderly
sales and a minimal market impact. In the event the Sponsor does not so direct,
the Securities shall be sold within a reasonable period and in such manner as
the Trustee, in its sole discretion, shall determine. At least 30 days before
the Mandatory Termination Date the Trustee will provide written notice of any
termination to all Unitholders of the appropriate Trust and in the case of a
Trust will include with such notice a form to enable Unitholders owning the
minimum number of Units described in the Prospectus to request an in kind
distribution of the Securities. To be effective, this request must be returned
to the Trustee at least five business days prior to the Mandatory Termination
Date. On the Mandatory Termination Date (or on the previous business day if a
holiday) the Trustee will deliver each requesting Unitholder's pro rata number
of whole shares of the Securities in the Trust to the account of the
broker-dealer or bank designated by the Unitholder at Depository Trust Company.
The value of the Unitholder's fractional shares of the Securities will be paid
in cash. Unitholders not requesting an in kind distribution will receive a cash
distribution from the sale of the remaining Securities within a reasonable time
following the Mandatory Termination Date. Regardless of the distribution
involved, the Trustee will deduct from the funds of the Trust any accrued costs,
expenses, advances or indemnities provided by the Trust Agreement, including
estimated compensation of the Trustee, costs of liquidation and any amounts
required as a reserve to provide for payment of any applicable taxes or other
governmental charges. Any sale of Securities in the Trust upon termination may
result in a lower amount than might otherwise be realized if such sale were not
required at such time. The Trustee will then distribute to each Unitholder of
each Trust his pro rata share of the balance of the Income and Capital Accounts.
Within 60 days of the final distribution Unitholders will be furnished a
final distribution statement of the amount distributable. At such time as the
Trustee in its sole discretion will determine that any amounts held in reserve
are no longer necessary, it will make distribution thereof to Unitholders in the
same manner.
CONTENTS OF REGISTRATION STATEMENT
This Amendment No. 2 of Registration Statement comprises the following
papers and documents:
The facing sheet
The Prospectus
The signatures
The consents of independent public accountants and legal counsel
The following exhibits:
1.1 Copy of Trust Agreement.
2.1 Form of Code of Ethics. Reference is made to Exhibit 2.1 to the
Registration Statement on Form S-6 of Van Kampen Focus
Portfolios, Series 223 (File No. 333-34242) dated July 25, 2000.
3.1 Opinion and consent of counsel as to legality of securities being
registered.
3.2 Opinion of Counsel as to the Federal Income tax status of
securities being registered.
3.3 Opinion and consent of counsel as to New York tax status of
securities being registered.
4.1 Consent of Interactive Data Corporation.
4.2 Consent of Independent Certified Public Accountants.
SIGNATURES
The Registrant, Van Kampen Focus Portfolios, Series 224, hereby
identifies Van Kampen Merritt Equity Opportunity Trust, Series 1, Series 2,
Series 4 and Series 7 and Van Kampen American Capital Equity Opportunity Trust,
Series 13, Series 14, Series 57 and Series 89 for purposes of the
representations required by Rule 487 and represents the following: (1) that the
portfolio securities deposited in the series as to the securities of which this
Registration Statement is being filed do not differ materially in type or
quality from those deposited in such previous series; (2) that, except to the
extent necessary to identify the specific portfolio securities deposited in, and
to provide essential financial information for, the series with respect to the
securities of which this Registration Statement is being filed, this
Registration Statement does not contain disclosures that differ in any material
respect from those contained in the registration statements for such previous
series as to which the effective date was determined by the Commission or the
staff; and (3) that it has complied with Rule 460 under the Securities Act of
1933.
Pursuant to the requirements of the Securities Act of 1933, the
Registrant, Van Kampen Focus Portfolios, Series 224 has duly caused this
Amendment No. 2 to the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Chicago and State of
Illinois on the 12th day of December, 2000.
Van Kampen Focus Portfolios, Series 224
By Van Kampen Funds Inc.
By Christine K. Putong
--------------------------
Assistant Vice President
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 2 to the Registration Statement has been signed below on December
12, 2000 by the following persons who constitute a majority of the Board of
Directors of Van Kampen Funds Inc.
SIGNATURE TITLE
Richard F. Powers III Chairman and Chief Executive Officer )
John H. Zimmermann III President
A. Thomas Smith III Executive Vice President, )
General Counsel and Secretary )
Michael H. Santo Executive Vice President and Chief )
Operations and Technology Officer )
Christine K. Putong
----------------------------
(Attorney-in-fact*)
--------------------------------------------------------------------------------
*An executed copy of each of the related powers of attorney is filed
herewith or was filed with the Securities and Exchange Commission in connection
with the Registration Statement on Form S-6 of Van Kampen Focus Portfolios,
Series 136 (File No. 333-70897) and the same are hereby incorporated herein by
this reference.
