Registration No. 333-42674
1940 Act No. 811-05903
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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:
FT 450
B. Name of depositor:
NIKE SECURITIES L.P.
C. Complete address of depositor's principal executive offices:
1001 Warrenville Road
Lisle, Illinois 60532
D. Name and complete address of agents for service:
Copy to:
JAMES A. BOWEN ERIC F. FESS
c/o Nike Securities L.P. c/o Chapman and Cutler
1001 Warrenville Road 111 West Monroe Street
Lisle, Illinois 60532 Chicago, Illinois 60603
E. Title of Securities Being Registered:
An indefinite number of Units pursuant to Rule 24f-2
promulgated under the Investment Company Act of 1940, as
amended
F. Approximate date of proposed sale to public:
As soon as practicable after the effective date of the
Registration Statement.
|XXX|Check box if it is proposed that this filing will become
effective on August 22, 2000 at 2:00 p.m. pursuant to Rule 487.
________________________________
Watchman Growth and Treasury Securities Portfolio, Series 2
FT 450
FT 450 is a series of a unit investment trust, the FT Series. FT 450
consists of a single portfolio known as Watchman Growth and Treasury
Securities Portfolio, Series 2 (the "Trust"). The Trust consists of a
portfolio of common stocks ("Equity Securities") and U.S. Treasury zero
coupon bonds ("Treasury Obligations"). Collectively, the Equity
Securities and Treasury Obligations are referred to as the "Securities."
The objective of the Trust is to provide the potential for capital
appreciation together with protection against a loss of capital for
investors who hold their investment until the termination of the Trust.
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED
OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
First Trust(registered trademark)
1-800-621-9533
The date of this prospectus is August 22, 2000
Page 1
Table of Contents
Summary of Essential Information 3
Fee Table 4
Report of Independent Auditors 5
Statement of Net Assets 6
Schedule of Investments 7
The FT Series 9
Portfolio 10
Risk Factors 10
Portfolio Securities Descriptions 11
Public Offering 13
Distribution of Units 15
The Sponsor's Profits 16
The Secondary Market 16
How We Purchase Units 16
Expenses and Charges 16
Tax Status 17
Retirement Plans 19
Rights of Unit Holders 19
Income and Capital Distributions 20
Redeeming Your Units 20
Removing Securities from the Trust 21
Amending or Terminating the Indenture 22
Information on the Sponsor, Trustee and Evaluator 23
Other Information 24
Page 2
Summary of Essential Information
Watchman Growth and Treasury Securities Portfolio, Series 2
FT 450
At the Opening of Business on the Initial Date of Deposit
of the Securities-August 22, 2000
Sponsor: Nike Securities L.P.
Trustee: The Chase Manhattan Bank
Evaluator: First Trust Advisors L.P.
<TABLE>
<CAPTION>
<S> <C>
Initial Number of Units 15,000
Fractional Undivided Interest in the Trust per Unit 1/15,000
Public Offering Price:
Aggregate Offering Price Evaluation of Securities per Unit (1) $ 9.651
Maximum Sales Charge of 4.50% of the Public Offering Price per Unit
(4.541% of the net amount invested, exclusive of the deferred sales charge) (2) $ .439
Less Deferred Sales Charge per Unit $ (.350)
Public Offering Price per Unit (3) $ 9.740
Sponsor's Initial Repurchase Price per Unit (4) $ 9.301
Redemption Price per Unit (based on the bid side evaluation of the Treasury Obligations and
the aggregate underlying value of the Equity Securities, less the deferred sales charge) (4) $ 9.278
CUSIP Number 30265T 509
Fee Accounts CUSIP Number 30265T 517
Security Code 59454
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
First Settlement Date August 25, 2000
Mandatory Termination Date (5) November 30, 2012
Income Distribution Record Date Fifteenth day of each June and December, commencing December 15, 2000.
Income Distribution Date (6) Last day of each June and December, commencing December 31, 2000.
______________
<FN>
(1) Each listed Equity Security is valued at its last closing sale
price, and each Treasury Obligation is valued at its last offering
price. If an Equity Security is not listed, or if no closing sale price
exists, it is valued at its closing ask price. Evaluations for purposes
of determining the purchase, sale or redemption price of Units are made
as of the close of trading on the New York Stock Exchange ("NYSE")
(generally 4:00 p.m. Eastern time) on each day on which it is open (the
"Evaluation Time").
(2) The maximum sales charge consists of an initial sales charge and a
deferred sales charge. See "Fee Table" and "Public Offering."
(3) The Public Offering Price shown above reflects the value of the
Securities on the business day prior to the Initial Date of Deposit. No
investor will purchase Units at this price. The price you pay for your
Units will be based on their valuation at the Evaluation Time on the
date you purchase your Units. On the Initial Date of Deposit, the Public
Offering Price per Unit will not include any accumulated dividends on
the Equity Securities. After this date, a pro rata share of any
accumulated dividends on the Equity Securities will be included.
(4) Until the earlier of six months after the Initial Date of Deposit or
the end of the initial offering period the Sponsor's Initial Repurchase
Price per Unit and the Redemption Price per Unit will include the
estimated organization costs per Unit set forth under "Fee Table." After
such date, the Sponsor's Repurchase Price and Redemption Price per Unit
will not include such estimated organization costs. See "Redeeming Your
Units."
(5) See "Amending or Terminating the Indenture."
(6) Distributions from the Capital Account will be made monthly on the
last day of each month to Unit holders of record on the fifteenth day of
such month if the amount available for distribution equals at least
$1.00 per 100 Units. In any case, we will distribute any funds in the
Capital Account in December of each year.
</FN>
</TABLE>
Page 3
Fee Table
This Fee Table describes the fees and expenses that you may, directly or
indirectly, pay if you buy and hold Units of the Trust. See "Public
Offering" and "Expenses and Charges." Although the Trust has a term of
approximately 12 years and is a unit investment trust rather than a
mutual fund, this information allows you to compare fees.
<TABLE>
<CAPTION>
Amount
per Unit
________
<S> <C> <C>
Unit Holder Transaction Expenses
(as a percentage of public offering price)
Maximum sales charge 4.50% $.439
Initial sales charge (paid at time of purchase) 0.91%(a) .089
Deferred sales charge (paid in installments or at redemption) 3.59%(b) .350
Organization Costs
(as a percentage of public offering price)
Estimated organization costs .231%(c) $.0225
======== ========
Estimated Annual Trust Operating Expenses(d)
(as a percentage of average net assets)
Portfolio supervision, bookkeeping, administrative and evaluation fees .103% $.0098
Creation and development fee .350%(e) .0334
Trustee's fee and other operating expenses .157%(f) .0150
________ ________
Total .610% $.0582
======== ========
Example
This example is intended to help you compare the cost of investing in
the Trust with the cost of investing in other investment products. The
example assumes that you invest $10,000 in the Trust for the periods
shown and then sell your Units at the end of those periods. The example
also assumes a 5% return on your investment each year and that the
Trust's operating expenses stay the same. Although your actual costs may
vary, based on these assumptions your costs would be:
1 Year 3 Years 5 Years 10 Years
______ _______ _______ ________
$536 $664 $803 $1,207
_____________
<FN>
(a) The initial sales charge is the difference between the maximum sales
charge of 4.50% and any remaining deferred sales charge.
(b) The deferred sales charge is a fixed dollar amount equal to $.350 per
Unit which, as a percentage of the Public Offering Price, will vary over
time. The deferred sales charge will be deducted in five monthly
installments commencing March 20, 2001.
(c) Estimated organization costs will be deducted from the assets of the
Trust at the earlier of six months after the Initial Date of Deposit or
the end of the initial offering period.
(d) With the exception of the creation and development fee, each of the
fees listed herein is assessed on a fixed dollar amount per Unit basis
which, as a percentage of average net assets, will vary over time.
(e) The creation and development fee compensates the Sponsor for creating
and developing the Trust. During the life of the Trust, this fee is
accrued daily based on the Trust's net asset value at the annual rate of
.35%. The Trust pays the amount of any accrued creation and development
fee to the Sponsor monthly from the Trust's assets. In connection with
the creation and development fee, in no event will the Sponsor collect
over the life of the Trust more than 2.75% of a Unit holder's initial
investment.
(f) Other operating expenses, however, do not include brokerage costs and
other portfolio transaction fees. In certain circumstances the Trust may
incur additional expenses not set forth above. See "Expenses and Charges."
</FN>
</TABLE>
Page 4
Report of Independent Auditors
The Sponsor, Nike Securities L.P., and Unit Holders
FT 450
We have audited the accompanying statement of net assets, including the
schedule of investments, of FT 450, comprised of Watchman Growth and
Treasury Securities Portfolio, Series 2, as of the opening of business
on August 22, 2000. This statement of net assets is the responsibility
of the Trust's Sponsor. Our responsibility is to express an opinion on
this statement of net assets based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
statement of net assets is free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the statement of net assets. Our procedures included
confirmation of the letter of credit held by the Trustee and deposited
in the Trust on August 22, 2000. An audit also includes assessing the
accounting principles used and significant estimates made by the
Sponsor, as well as evaluating the overall presentation of the statement
of net assets. We believe that our audit of the statement of net assets
provides a reasonable basis for our opinion.
In our opinion, the statement of net assets referred to above presents
fairly, in all material respects, the financial position of FT 450,
comprised of the Watchman Growth and Treasury Securities Portfolio,
Series 2, at the opening of business on August 22, 2000 in conformity
with accounting principles generally accepted in the United States.
ERNST & YOUNG LLP
Chicago, Illinois
August 22, 2000
Page 5
Statement of Net Assets
Watchman Growth and Treasury Securities Portfolio, Series 2
FT 450
At the Opening of Business on the
Initial Date of Deposit-August 22, 2000
<TABLE>
<CAPTION>
<S> <C>
NET ASSETS
Investment in Securities represented by purchase contracts (1) (2) $144,769
Less liability for reimbursement to Sponsor for organization costs (3) (338)
Less liability for deferred sales charge (4) (5,250)
________
Net assets $139,181
========
Units outstanding 15,000
ANALYSIS OF NET ASSETS
Cost to investors (5) $146,093
Less maximum sales charge (5) (6,574)
Less estimated reimbursement to Sponsor for organization costs (3) (338)
________
Net assets $139,181
========
_____________
<FN>
NOTES TO STATEMENT OF NET ASSETS
(1) Aggregate cost of the Securities listed under "Schedule of
Investments" is based on their aggregate underlying value.
(2) An irrevocable letter of credit issued by The Chase Manhattan Bank,
of which $200,000 will be allocated to the Trust, has been deposited
with the Trustee as collateral, covering the monies necessary for the
purchase of the Securities according to their purchase contracts.
(3) A portion of the Public Offering Price consists of an amount
sufficient to reimburse the Sponsor for all or a portion of the costs of
establishing the Trust. These costs have been estimated at $.0225 per
Unit for the Trust. A payment will be made as of the earlier of six
months after the Initial Date of Deposit or the end of the initial
offering period to an account maintained by the Trustee from which the
obligation of the investors to the Sponsor will be satisfied. To the
extent that actual organization costs are greater than the estimated
amount, only the estimated organization costs added to the Public
Offering Price will be reimbursed to the Sponsor and deducted from the
assets of the Trust.
(4) Represents the amount of mandatory deferred sales charge
distributions from the Trust ($.350 per Unit), payable to us in five
equal monthly installments beginning on March 20, 2001 and on the
twentieth day of each month thereafter (or if such date is not a
business day, on the preceding business day) through July 20, 2001. If
you redeem Units before July 20, 2001 you will have to pay the remaining
amount of the deferred sales charge applicable to such Units when you
redeem them.
(5) The aggregate cost to investors in the Trust includes a maximum
sales charge (comprised of an initial and a deferred sales charge)
computed at the rate of 4.50% of the Public Offering Price per Unit
(equivalent to 4.541% of the net amount invested, exclusive of the
deferred sales charge), assuming no reduction of sales charge as set
forth under "Public Offering."
</FN>
</TABLE>
Page 6
Schedule of Investments
Watchman Growth and Treasury Securities Portfolio, Series 2
FT 450
At the Opening of Business on the Initial Date of Deposit-August 22, 2000
<TABLE>
<CAPTION>
Percentage Market Value Cost of
Maturity of Aggregate per Share of Securities to
Value Name of Issuer and Title of Treasury Obligation (1) Offering Price Equity Securities the Trust (2)
________ ___________________________________________________ ______________ _________________ ____________
<C> <S> <C> <C> <C>
$150,000 Zero coupon U.S. Treasury bonds
maturing November 15, 2012 50.04% N.A. $ 72,443
Number Ticker Symbol and
of Shares Name of Issuer of Equity Securities (1)
________ _______________________________________
Capital Goods
_____________
51 GE General Electric Company 2.00% $ 56.875 2,901
Consumer Cyclicals
__________________
42 VIA/B Viacom Inc. (Class B) 1.98% 68.188 2,864
59 WMT Wal-Mart Stores, Inc. 2.00% 49.063 2,895
Consumer Staples
__________________
97 G The Gillette Company 1.99% 29.750 2,886
55 SWY Safeway Inc. 1.99% 52.250 2,874
Financial
______________
33 AIG American International Group, Inc. 2.00% 87.938 2,902
54 BAC Bank of America Corporation 2.01% 53.875 2,909
38 C Citigroup Inc. 2.02% 76.875 2,921
86 KRB MBNA Corporation 2.00% 33.688 2,897
20 MER Merrill Lynch & Co., Inc. 2.00% 144.500 2,890
37 NTRS Northern Trust Corporation 2.01% 78.563 2,907
Healthcare
______________
69 ABT Abbott Laboratories 1.99% 41.813 2,885
37 CAH Cardinal Health, Inc. 2.00% 78.375 2,900
30 JNJ Johnson & Johnson 2.01% 97.000 2,910
55 MDT Medtronic, Inc. 2.01% 52.813 2,905
40 MRK Merck & Co., Inc. 1.99% 72.063 2,882
66 PFE Pfizer Inc. 1.99% 43.625 2,879
Technology
______________
49 AUD Automatic Data Processing, Inc. 2.00% 59.125 2,897
44 CSCO Cisco Systems, Inc. 1.99% 65.500 2,882
75 DELL Dell Computer Corporation 2.01% 38.750 2,906
40 INTC Intel Corporation 1.99% 72.063 2,882
24 IBM International Business Machines Corporation 2.01% 121.438 2,914
23 JDSU JDS Uniphase Corporation 1.98% 124.375 2,861
42 LLTC Linear Technology Corporation 1.98% 68.375 2,872
36 MXIM Maxim Integrated Products, Inc. 2.01% 80.688 2,905
______ __________
Total Equity Securities 49.96% 72,326
Total Investments 100% $ 144,769
====== ==========
______________
<FN>
See "Notes to Schedule of Investments" on page 8.
Page 7
NOTES TO SCHEDULE OF INVESTMENTS
(1) The Treasury Obligations were purchased at a discount from their par
value because there is no stated interest income thereon (such
securities are often referred to as zero coupon U.S. Treasury bonds).
Over the life of the Treasury Obligations the value increases, so that
upon maturity the holders will receive 100% of the principal amount
thereof. All Securities are represented by regular way contracts to
purchase such Securities which are backed by an irrevocable letter of
credit deposited with the Trustee. We entered into purchase contracts
for the Securities on August 22, 2000.
(2) The cost of the Securities to the Trust represents the aggregate
underlying value with respect to the Securities acquired (generally
determined by the closing sale prices of the listed Equity Securities,
the ask prices of the over-the-counter traded Equity Securities and the
offering side price of the Treasury Obligations at the Evaluation Time
on the business day preceding the Initial Date of Deposit). The offering
side price of the Treasury Obligations is greater than the bid side
price of the Treasury Obligations which is the basis on which the
Redemption Price per Unit will be determined. The value of the
Securities based on the bid side price of the Treasury Obligations and
the value of the Equity Securities is $144,425. The valuation of the
Securities has been determined by the Evaluator, an affiliate of ours.
The cost of the Securities to us and our profit (which is the
difference between the cost of the Securities to us and the cost of the
Securities to the Trust) are $144,675 and $94, respectively.
</FN>
</TABLE>
Page 8
The FT Series
The FT Series Defined.
We, Nike Securities L.P. (the "Sponsor"), have created hundreds of
similar yet separate series of a unit investment trust which we have
named the FT Series. The series to which this prospectus relates, FT
450, consists of a single portfolio known as Watchman Growth and
Treasury Securities Portfolio, Series 2.
The Trust was created under the laws of the State of New York by a Trust
Agreement (the "Indenture") dated the Initial Date of Deposit. This
agreement, entered into among Nike Securities L.P., as Sponsor, The
Chase Manhattan Bank as Trustee and First Trust Advisors L.P. as
Portfolio Supervisor and Evaluator, governs the operation of the Trust.
YOU MAY GET MORE SPECIFIC DETAILS CONCERNING THE NATURE, STRUCTURE AND
RISKS OF THIS PRODUCT IN AN "INFORMATION SUPPLEMENT" BY CALLING THE
TRUSTEE AT 1-800-682-7520.
How We Created the Trust.
On the Initial Date of Deposit, we deposited a portfolio of zero coupon
U.S. Treasury bonds and common stocks with the Trustee, and in turn, the
Trustee delivered documents to us representing our ownership of the
Trust in the form of units ("Units").
After the Initial Date of Deposit, we may deposit additional Securities
in the Trust, or cash (including a letter of credit) with instructions
to buy more Securities, to create new Units for sale. If we create
additional Units, we will attempt, to the extent practicable, to
maintain the percentage relationship established among the Securities on
the Initial Date of Deposit (as set forth in "Schedule of Investments"),
and not the actual percentage relationship existing on the day we are
creating new Units, since the two may differ. This difference may be due
to the sale, redemption or liquidation of any of the Securities.
Since the prices of the Securities will fluctuate daily, the ratio of
Securities in the Trust, on a market value basis, will also change
daily. The portion of Securities represented by each Unit will not
change as a result of the deposit of additional Securities or cash in
the Trust. If we deposit cash, you and new investors may experience a
dilution of your investment. This is because prices of Securities will
fluctuate between the time of the cash deposit and the purchase of the
Securities, and because the Trust pays the associated brokerage fees. To
reduce this dilution, the Trust will try to buy the Securities as close
to the Evaluation Time and as close to the evaluation price as possible.
In addition, because the Trust pays the brokerage fees associated with
the creation of new Units and with the sale of Securities to meet
redemption and exchange requests, frequent redemption and exchange
activity will likely result in higher brokerage expenses.
An affiliate of the Trustee may receive these brokerage fees or the
Trustee may retain and pay us (or our affiliate) to act as agent for the
Trust to buy Securities. If we or an affiliate of ours act as agent to
the Trust, we will be subject to the restrictions under the Investment
Company Act of 1940, as amended.
We cannot guarantee that the Trust will keep its present size and
composition for any length of time. Securities may periodically be sold
under certain circumstances, and the proceeds from these sales will be
used to meet Trust obligations or distributed to Unit holders, but will
not be reinvested. However, Securities will not be sold to take
advantage of market fluctuations or changes in anticipated rates of
appreciation or depreciation, or if they no longer meet the criteria by
which they were selected. You will not be able to dispose of or vote any
of the Securities in the Trust. As the holder of the Securities, the
Trustee will vote all of the Equity Securities and will do so based on
our instructions.
Neither we nor the Trustee will be liable for a failure in any of the
Securities. However, if a contract for the purchase of any of the
Securities initially deposited in the Trust fails, unless we can
purchase substitute Securities ("Replacement Securities") we will refund
to you that portion of the purchase price and sales charge resulting
from the failed contract on the next Income Distribution Date. Any
Replacement Security the Trust acquires will be identical to those from
the failed contract.
Page 9
Portfolio
Objectives.
The Trust's objective is to provide investors with principal protection
by investing approximately 50.04% of the Trust's portfolio in zero
coupon U.S. Treasury Obligations and to provide the potential for
capital appreciation by investing approximately 49.96% of the Trust's
portfolio in blue chip common stocks.
As an investor in the Trust, you may accomplish two investment goals -
safety and growth. You benefit from the security associated with a
guaranteed minimum maturity value when Units are held to maturity,
because while the initial offer price is $9.740 per Unit, and the market
value may fluctuate during the life of the Trust, the minimum maturity
value will be at least $10.00 per Unit. In addition, you have the
potential for capital appreciation from professionally selected stocks.
The portfolio of blue chip stocks was selected by sophisticated computer
screening techniques, fundamental analysis and the judgment of the
experienced research staff at Gibraltar Securities. Many investors
choose blue chip stocks because they are typically well-known companies
with:
- dominance of their particular market;
- substantial financial resources and strong balance sheets;
- products and services which are used and sold worldwide and typically
stay in demand;
- a solid track record of generating earnings growth.
The Treasury Obligations have been purchased at a discount from their
face amount but are designed to return $10 per Unit at the Mandatory
Termination Date to investors who hold their Units until the termination
of the Trust. The Treasury Obligations are backed by the full faith and
credit of the U.S. Government and will mature on November 15, 2012. The
Trust only has a right to receive a fixed payment at the maturity of the
Treasury Obligations.
You should be aware that, as with any similar investment, there can be
no guarantee that the objective of the Trust will be achieved. See "Risk
Factors" for a discussion of the risks of investing in the Trust.
Risk Factors
Price Volatility. The Trust invests in Treasury Obligations and common
stocks. The value of the Trust's Units will fluctuate with changes in
the value of these Treasury Obligations and common stocks.
Common stock prices fluctuate for several reasons including changes in
investors perceptions of the financial condition of an issuer or the
general condition of the relevant stock market, or when political or
economic events affecting the issuers occur. In addition, common stock
prices may be particularly sensitive to rising interest rates, as the
cost of capital rises and borrowing costs increase.
The value of the Treasury Obligations will be adversely affected by
decreases in bond prices and increases in interest rates.
Because the Trust is not managed, the Trustee will not sell Securities
in response to or in anticipation of market fluctuations, as is common
in managed investments. As with any investment, we cannot guarantee that
the performance of the Trust will be positive over any period of time or
that you won't lose money. Units of the Trust are not deposits of any
bank and are not insured or guaranteed by the Federal Deposit Insurance
Corporation or any other government agency.
Distributions. There is no guarantee that the issuers of the Equity
Securities will declare dividends in the future or that if declared they
will either remain at current levels or increase over time.
Because the Treasury Obligations pay no interest until their maturity,
Equity Securities may have to be sold to pay Trust expenses or meet
redemption requests. As the Treasury Obligations ensure that the Trust
will be able to provide $10 per Unit at the Trust's termination, they
will not be sold to pay expenses of the Trust or to meet redemption
requests unless their sale will not reduce the per Unit termination
value below $10. The sale of a portion of the Equity Securities in these
situations will reduce the capital appreciation potential of the Trust.
In addition, you will be required to include original issue discount
relating to the Treasury Obligations in income every year as it accrues,
even prior to receiving any cash distributions.
Legislation/Litigation. From time to time, various legislative
initiatives are proposed in the United States and abroad which may have
Page 10
a negative impact on certain companies represented in the Trust.
Litigation regarding any of the issuers of the Equity Securities or the
industries represented in the Trust may negatively impact the share
prices of these Equity Securities. In addition, litigation may be
initiated on a variety of grounds affecting the Treasury Obligations. We
cannot predict what impact any pending or proposed legislation or
pending or threatened litigation will have on the share prices of the
Securities.
Termination Value. The Trust has been designed to return to investors at
least $10 per Unit only at its termination. If you redeem or sell your
Units prior to termination of the Trust, the amount you will receive
will be affected by the values at that time of the Treasury Obligations
and of the Equity Securities, and you may receive less than $10 per Unit.
Portfolio Securities Descriptions
Capital Goods
_____________
General Electric Company, headquartered in Fairfield, Connecticut, makes
major appliances, industrial and power systems, aircraft engines,
engineered plastics, silicones, superabrasives, laminates and technical
products. The company owns the National Broadcasting Company (NBC),
which furnishes TV network services, produces programs and operates VHF
and UHF TV stations, and also offers a variety of financial services
through General Electric Capital Services, Inc.
Consumer Cyclicals
__________________
Viacom Inc. (Class B), headquartered in New York, New York, operates
satellite entertainment networks, television stations and theme parks;
produces and distributes theatrical motion pictures and television
programming; operates videocassette rental and sales stores; and
publishes books and software products. The company's operations include
Blockbuster video and music retailers, MTV Networks, Paramount Pictures,
Paramount Television, Paramount Parks, Showtime Networks, and Simon &
Schuster publishing company.
Wal-Mart Stores, Inc., headquartered in Bentonville, Arkansas, is the
largest retailer in the United States measured by total revenues. The
company operates "Wal-Mart" retail discount department stores, "Wal-Mart
Supercenters" and "Sam's" wholesale clubs in the United States and
several other countries.
Consumer Staples
________________
The Gillette Company, headquartered in Boston, Massachusetts, is a
worldwide manufacturer of grooming products, writing instruments and
correction products, toothbrushes and oral care appliances, and alkaline
batteries.
Safeway Inc., headquartered in Pleasanton, California, operates a large
chain of food and drug stores in the United States and Canada under the
names of "Safeway," "Dominick's," "Vons" and "Carr-Gottstein." The
company's stores offer a wide selection of food and general merchandise
and feature specialty departments such as bakery, delicatessen, floral
and pharmacy. The company also has a network of distribution,
manufacturing and food-processing facilities and holds an interest in
Casa Ley, S.A. de C.V., an operator of food and general merchandise
stores in western Mexico.
Financial
_________
American International Group, Inc., headquartered in New York, New York,
through subsidiaries, provides a broad range of insurance and insurance-
related activities and financial services in the United States and
abroad. The company writes property and casualty and life insurance, and
also provides financial services.
Bank of America Corporation, headquartered in Charlotte, North Carolina,
is the holding company for Bank of America and NationsBank and conducts
a general banking business in the United States and overseas.
Citigroup Inc., headquartered in New York, New York, operates the
largest financial services company in the United States. The company
offers consumer, investment and private banking, life insurance,
property and casualty insurance and consumer finance products.
MBNA Corporation, headquartered in Wilmington, Delaware, is the holding
company for MBNA America Bank, N.A. The company issues bank credit cards
marketed primarily to members of associations and customers of financial
institutions. The company also makes other consumer loans, and offers
insurance and deposit products.
Merrill Lynch & Co., Inc., headquartered in New York, New York, through
subsidiaries, provides a variety of financial and investment services
through offices around the world. The company serves individual and
institutional clients with a range of financial services, including
Page 11
personal financial planning, trading and brokering, banking and lending,
and insurance.
Northern Trust Corporation, headquartered in Chicago, Illinois, through
subsidiaries, provides banking and trust services to corporate and
institutional customers through offices in the United States and several
foreign countries. The company also operates a securities brokerage firm
and investment management services, and acts as a futures commission
merchant.
Healthcare
__________
Abbott Laboratories, headquartered in Abbott Park, Illinois, discovers,
develops, makes and sells a broad and diversified line of healthcare
products and services.
Cardinal Health, Inc., headquartered in Dublin, Ohio, distributes a
broad line of pharmaceuticals, surgical and hospital supplies,
therapeutic plasma and other specialty pharmaceutical products, health
and beauty care products and other items typically sold by hospitals,
retail drug stores and other healthcare providers. The company also
makes, leases and sells point-of-use pharmacy systems; provides pharmacy
management services; and franchises apothecary-style pharmacies.
Johnson & Johnson, headquartered in New Brunswick, New Jersey, makes and
sells pharmaceuticals, personal healthcare products, medical and
surgical equipment, and contact lenses.
Medtronic, Inc., headquartered in Minneapolis, Minnesota, makes and
sells implantable cardiac pacemakers, implantable and external
defibrillators, heart valves, and other vascular, cardiac and
neurological products.
Merck & Co., Inc., headquartered in Whitehouse Station, New Jersey, is a
leading pharmaceutical concern that discovers, develops, makes and
markets a broad range of human and animal health products and services.
The company also administers managed prescription drug programs.
Pfizer Inc., headquartered in New York, New York, produces and
distributes anti-infectives, anti-inflammatory agents, cardiovascular
agents, antifungal drugs, central nervous system agents, orthopedic
implants, food science products, animal health products, toiletries,
baby care products, dental rinse and other proprietary health items.
Technology
__________
Automatic Data Processing, Inc., headquartered in Roseland, New Jersey,
through subsidiaries, provides computer services, including employer,
brokerage, dealer and automotive claims services.
Cisco Systems, Inc., headquartered in San Jose, California, provides
networking solutions that connect computing devices and computer
networks. The company offers various products to utilities,
corporations, universities, governments and small to medium businesses
worldwide.
Dell Computer Corporation, headquartered in Round Rock, Texas, designs,
develops, makes, sells, services and supports a broad range of computer
systems, including desktops, notebooks and servers compatible with
industry standards under the "Dell" brand name. The company also sells
software, peripheral equipment, and service and support programs.
Intel Corporation, headquartered in Santa Clara, California, designs,
develops, makes and markets advanced microcomputer components and
related products at various levels of integration. Principal components
consist of silicon-based semiconductors etched with complex patterns of
transistors.
International Business Machines Corporation, headquartered in Armonk,
New York, provides customer solutions through the use of advanced
information technologies. The company offers a variety of solutions that
include services, software, systems, products, financing and technologies.
JDS Uniphase Corporation, headquartered in San Jose, California,
designs, develops, makes and markets laser subsystems, laser-based
semiconductor wafer defect examination and analysis equipment and fiber
optic telecommunications equipment products.
Linear Technology Corporation, headquartered in Milpitas, California,
designs, makes and markets a broad line of standard high performance
linear integrated circuits using silicon gate complementary metal-oxide
semiconductor (CMOS), BiCMOS and bipolar and complementary bipolar wafer
process technologies.
Maxim Integrated Products, Inc., headquartered in Sunnyvale, California,
designs and makes linear and mixed-signal integrated circuits. The
company's products include data converters, interface circuits,
microprocessor-supervisors and amplifiers.
We have obtained the foregoing descriptions from sources we deem
reliable. We have not independently verified the provided information
either in terms of accuracy or completeness.
Page 12
Public Offering
The Public Offering Price.
You may buy Units at the Public Offering Price. The Public Offering
Price per Unit is comprised of the following:
- The aggregate offering side evaluation of the Treasury Obligations;
- The aggregate underlying value of the Equity Securities;
- The amount of any cash in the Income and Capital Accounts;
- Dividends receivable on Equity Securities; and
- The total sales charge (which combines an initial up-front sales
charge and a deferred sales charge).
The price you pay for your Units will differ from the amount stated
under "Summary of Essential Information" due to various factors,
including fluctuations in the prices of the Securities and changes in
the value of the Income and/or Capital Accounts.
Although you are not required to pay for your Units until three business
days following your order (the "date of settlement"), you may pay before
then. You will become the owner of Units ("Record Owner") on the date of
settlement if payment has been received. If you pay for your Units
before the date of settlement, we may use your payment during this time
and it may be considered a benefit to us, subject to the limitations of
the Securities Exchange Act of 1934.
Organization Costs.
Equity Securities purchased with the portion of the Public Offering
Price intended to be used to reimburse the Sponsor for the Trust's
organization costs (including costs of preparing the registration
statement, the Indenture and other closing documents, registering Units
with the Securities and Exchange Commission ("SEC") and states, the
initial audit of the Trust portfolio, legal fees and the initial fees
and expenses of the Trustee) will be purchased in the same proportionate
relationship as all the Equity Securities contained in the Trust. Equity
Securities will be sold to reimburse the Sponsor for the Trust's
organization costs at the earlier of six months after the Initial Date
of Deposit or the end of the initial offering period (a significantly
shorter time period than the life of the Trust). During the period
ending with the earlier of six months after the Initial Date of Deposit
or the end of the initial offering period, there may be a decrease in
the value of the Equity Securities. To the extent the proceeds from the
sale of these Equity Securities are insufficient to repay the Sponsor
for the Trust organization costs, the Trustee will sell additional
Equity Securities to allow the Trust to fully reimburse the Sponsor. In
that event, the net asset value per Unit will be reduced by the amount
of additional Equity Securities sold. Although the dollar amount of the
reimbursement due to the Sponsor will remain fixed and will never exceed
the per Unit amount set forth for the Trust in "Statement of Net
Assets," this will result in a greater effective cost per Unit to Unit
holders for the reimbursement to the Sponsor. To the extent actual
organization costs are less than the estimated amount, only the actual
organization costs will be deducted from the assets of the Trust. When
Equity Securities are sold to reimburse the Sponsor for organization
costs, the Trustee will sell such Equity Securities, to the extent
practicable, which will maintain the same proportionate relationship
among the Equity Securities contained in the Trust as existed prior to
such sale.
Minimum Purchase.
The minimum amount you can purchase of the Trust is $1,000 worth of
Units ($500 if you are purchasing Units for your Individual Retirement
Account or any other qualified retirement plan).
Sales Charges.
The sales charge you will pay has both an initial and a deferred
component. The initial sales charge, which you will pay at the time of
purchase, is equal to the difference between the maximum sales charge of
4.50% of the Public Offering Price and the maximum remaining deferred
sales charge (initially $.350 per Unit). This initial sales charge is
initially equal to approximately .91% of the Public Offering Price of a
Unit, but will vary from .91% depending on the purchase price of your
Units and as deferred sales charge payments are made. When the Public
Offering price exceeds $10.00 per Unit, the initial sales charge will
exceed 1.00% of the Public Offering Price.
Monthly Deferred Sales Charge. In addition, five monthly deferred sales
charge payments of $.07 per Unit will be deducted from the Trust's
assets on the 20th day of each month from March 20, 2001 through July
20, 2001. If you buy Units at a price of less than $10.00 per Unit, the
dollar amount of the deferred sales charge will not change, but the
Page 13
deferred sales charge on a percentage basis will be more than 3.50% of
the Public Offering Price.
If you purchase Units after the last deferred sales charge payment has
been assessed, your sales charge will consist of a one-time initial
sales charge of 4.50% of the Public Offering Price (equivalent to 4.712%
of the net amount invested), which will be reduced by 1/2 of 1% on each
subsequent August 31, commencing August 31, 2001, to a minimum sales
charge of 3.00%.
Discounts for Certain Persons.
If you invest at least $50,000 (except if you are purchasing for a "Fee
Accounts" as described below), the maximum sales charge is reduced, as
follows:
If you invest Your maximum sales
(in thousands):* charge will be:
_______________ __________________
$50 but less than $100 4.25%
$100 but less than $250 4.00%
$250 but less than $500 3.50%
$500 or more 2.50%
* The breakpoint sales charges are also applied on a Unit basis
utilizing a breakpoint equivalent in the above table of $10 per Unit and
will be applied on whichever basis is more favorable to the investor.
The breakpoints will be adjusted to take into consideration purchase
orders stated in dollars which cannot be completely fulfilled due to the
requirement that only whole Units be issued.
The reduced sales charge for quantity purchases will apply only to
purchases made by the same person on any one day from any one dealer. To
help you reach the above levels, you can combine the Units you purchase
of the Trust in this prospectus with any other same day purchases of
other trusts for which we are Principal Underwriter and are currently in
the initial offering period. In addition, we will also consider Units
you purchase in the name of your spouse or your child under 21 years of
age to be purchases by you. The reduced sales charges will also apply to
a trustee or other fiduciary purchasing Units for a single trust estate
or single fiduciary account. You must inform your dealer of any combined
purchases before the sale in order to be eligible for the reduced sales
charge. Any reduced sales charge is the responsibility of the party
making the sale.
You may use redemption or termination proceeds from any unit investment
trust we sponsor to purchase Units of the Trusts during the initial
offering period at the Public Offering Price less 1.00%. Please note
that any deferred sales charge remaining on units you redeem to buy
Units of this Trust will be deducted from those redemption proceeds.
Investors purchasing Units through registered broker/dealers who charge
periodic fees in lieu of commissions or who charge for financial
planning, investment advisory or asset management services or provide
these or comparable services as part of an investment account where a
comprehensive "wrap fee" or similar charge is imposed ("Fee Accounts")
will not be assessed the initial or deferred sales charge described in
this section on the purchase of Units. We reserve the right to limit or
deny purchases of Units not subject to the initial or deferred sales
charge by investors whose frequent trading activity we determine to be
detrimental to the Trust.
Employees, officers and directors (and immediate family members) of the
Sponsor, our related companies, dealers and their affiliates, and
vendors providing services to us may purchase Units at the Public
Offering Price less the applicable dealer concession. Immediate family
members include spouses, children, grandchildren, parents, grandparents,
siblings, mothers-in-law, fathers-in-law, sons-in-law, daughters-in-law,
brothers-in-law and sisters-in-law, and trustees, custodians or
fiduciaries for the benefit of such persons.
You will be charged the deferred sales charge per Unit regardless of any
discounts. However, if you are eligible to receive a discount such that
the maximum sales charge you must pay is less than the applicable
maximum deferred sales charge, including Fee Accounts Units, you will be
credited the difference between your maximum sales charge and the
maximum deferred sales charge at the time you buy your Units. If you
elect to have distributions reinvested into additional Units of the
Trust, in addition to the reinvestment Units you receive you will also
be credited additional Units with a dollar value at the time of
reinvestment sufficient to cover the amount of any remaining deferred
sales charge to be collected on such reinvestment Units. The dollar
value of these additional credited Units (as with all Units) will
fluctuate over time, and may be less on the dates deferred sales charges
are collected than their value at the time they were issued.
Page 14
The Value of the Securities.
The Evaluator will appraise the aggregate underlying value of the
Securities in the Trust as of the Evaluation Time on each business day
and will adjust the Public Offering Price of the Units according to this
valuation. This Public Offering Price will be effective for all orders
received before the Evaluation Time on each such day. If we or the
Trustee receive orders for purchases, sales or redemptions after that
time, or on a day which is not a business day, they will be held until
the next determination of price. The term "business day" as used in this
prospectus will exclude Saturdays, Sundays and certain national holidays
on which the NYSE is closed.
The aggregate underlying value of the Treasury Obligations will be
determined on the basis of current offering prices.
The aggregate underlying value of the Equity Securities will be
determined as follows: if the Equity Securities are listed on a
securities exchange or The Nasdaq Stock Market, their value is generally
based on the closing sale prices on that exchange or system (unless it
is determined that these prices are not appropriate as a basis for
valuation). However, if there is no closing sale price on that exchange
or system, they are valued based on the closing ask prices. If the
Equity Securities are not so listed, or, if so listed and the principal
market for them is other than on that exchange or system, their value
will generally be based on the current ask prices on the over-the-
counter market (unless it is determined that these prices are not
appropriate as a basis for valuation). If current ask prices are
unavailable, the valuation of the Equity Securities is generally
determined:
a) On the basis of current ask prices for comparable equity securities;
b) By appraising the value of the Equity Securities on the ask side of
the market; or
c) By any combination of the above.
After the initial offering period is over, the aggregate underlying
value of the Securities will be determined as set forth above, except
that bid prices are used instead of ask or offer prices when necessary.
Distribution of Units
We intend to qualify Units of the Trust for sale in a number of states.
All Units will be sold at the then current Public Offering Price.
Dealer Concessions.
Dealers and other selling agents can purchase Units at prices which
represent a concession or agency commission of 3.5% of the Public
Offering Price per Unit (or 65% of the maximum sales charge after August
31, 2001). However, for Units subject to a sales charge which are
purchased using redemption and/or termination proceeds, this amount will
be reduced to 2.5% of the sales price of these Units.
Dealers and other selling agents who sell Units of the Trust during the
initial offering period in the dollar amounts shown below will be
entitled to the following additional sales concessions as a percentage
of the Public Offering Price:
Total Sales Additional
(in millions): Concession:
_______________ ___________
$2.5 but less than $5 .10%
$5 but less than $10 .20%
$10 or more .30%
Dealers and other selling agents will not receive a concession on the
sale of Units which are not subject to the initial or deferred sales
charge, but such Units will be included in determining whether the above
volume sales levels are met. Dealers and other selling agents who,
during any consecutive 12-month period, sell at least $2 billion worth
of primary market units of unit investment trusts sponsored by us will
receive a concession of $30,000 in the month following the achievement
of this level. We reserve the right to change the amount of concessions
or agency commissions from time to time. Certain commercial banks may be
making Units of the Trust available to their customers on an agency
basis. A portion of the sales charge paid by these customers is kept by
or given to the banks in the amounts shown above.
Award Programs.
From time to time we may sponsor programs which provide awards to a
dealer's registered representatives who have sold a minimum number of
Page 15
Units during a specified time period. We may also pay fees to qualifying
dealers for services or activities which are meant to result in sales of
Units of the Trust. In addition, we will pay to dealers who sponsor
sales contests or recognition programs that conform to our criteria, or
participate in our sales programs, amounts equal to no more than the
total applicable sales charge on Units sold by such persons during such
programs. We make these payments out of our own assets and not out of
Trust assets. These programs will not change the price you pay for your
Units.
Investment Comparisons.
From time to time we may compare the estimated returns of the Trust
(which may show performance net of the expenses and charges the Trust
would have incurred) and returns over specified periods of other similar
trusts we sponsor in our advertising and sales materials, with (1)
returns on other taxable investments such as the common stocks
comprising various market indexes, corporate or U.S. Government bonds,
bank CDs and money market accounts or funds, (2) performance data from
Morningstar Publications, Inc. or (3) information from publications such
as Money, The New York Times, U.S. News and World Report, BusinessWeek,
Forbes or Fortune. The investment characteristics of the Trust differ
from other comparative investments. You should not assume that these
performance comparisons will be representative of the Trust's future
performance.
The Sponsor's Profits
We will receive a gross sales commission equal to the maximum sales
charge per Unit of the Trust less any reduced sales charge as stated in
"Public Offering." Also, any difference between our cost to purchase the
Securities and the price at which we sell them to the Trust is
considered a profit or loss. (See Note 2 of "Schedule of Investments.")
During the initial offering period, dealers and others may also realize
profits or sustain losses as a result of fluctuations after the Date of
Deposit in the Public Offering Price they receive when they sell the
Units.
In maintaining a market for Units, any difference between the price at
which we purchase Units and the price at which we sell or redeem them
will be a profit or loss to us.
The Secondary Market
Although not obligated, we intend to maintain a market for the Units
after the initial offering period and continuously offer to purchase
Units at prices based on the Redemption Price per Unit.
We will pay all expenses to maintain a secondary market, except the
Evaluator fees, Trustee costs to transfer and record the ownership of
Units and costs incurred in annually updating the Trust's registration
statement. We may discontinue purchases of Units at any time. IF YOU
WISH TO DISPOSE OF YOUR UNITS, YOU SHOULD ASK US FOR THE CURRENT MARKET
PRICES BEFORE MAKING A TENDER FOR REDEMPTION TO THE TRUSTEE. If you sell
or redeem your Units before you have paid the total deferred sales
charge on your Units, you will have to pay the remainder at that time.
How We Purchase Units
The Trustee will notify us of any tender of Units for redemption. If our
bid is equal to or greater than the Redemption Price per Unit, we may
purchase the Units. You will receive your proceeds from the sale no
later than if they were redeemed by the Trustee. We may tender Units we
hold to the Trustee for redemption as any other Units. If we elect not
to purchase Units, the Trustee may sell tendered Units in the over-the-
counter market, if any. However, the amount you will receive is the same
as you would have received on redemption of the Units.
Expenses and Charges
The estimated annual expenses of the Trust are listed under "Fee Table."
If actual expenses exceed the estimate, the Trust will bear the excess.
The Trustee will pay operating expenses of the Trust from the Income
Account of the Trust if funds are available, and then from the Capital
Account. The Income and Capital Accounts are noninterest-bearing to Unit
holders, so the Trustee may earn interest on these funds, thus
benefiting from their use.
As Sponsor, we will be compensated for providing bookkeeping and other
administrative services to the Trust, and will receive brokerage fees
when the Trust uses us (or an affiliate of ours) as agent in buying or
selling Securities. Legal, typesetting, electronic filing and regulatory
Page 16
filing fees and expenses associated with updating the Trust's
registration statement are also now chargeable to the Trust.
Historically, we paid these fees and expenses. First Trust Advisors
L.P., an affiliate of ours, acts as both Portfolio Supervisor and
Evaluator to the Trust and will receive the fees set forth under "Fee
Table" for providing portfolio supervisory and evaluation services to
the Trust. In providing portfolio supervisory services, the Portfolio
Supervisor may purchase research services from a number of sources,
which may include underwriters or dealers of the Trust.
The fees payable to us, First Trust Advisors L.P. and the Trustee are
based on the largest aggregate number of Units of the Trust outstanding
at any time during the calendar year, except during the initial offering
period, in which case these fees are calculated based on the largest
number of Units outstanding during the period for which compensation is
paid. These fees may be adjusted for inflation without Unit holders'
approval, but in no case will the annual fees paid to us or our
affiliates for providing a given service to all unit investment trusts
for which we provide such services be more than the actual cost of
providing such service in such year.
As Sponsor, we will receive a fee from the Trust for creating and
developing the Trust, including determining the Trust's objectives,
policies, composition and size, selecting service providers and
information services and for providing other similar administrative and
ministerial functions. The "creation and development fee" is accrued
(and becomes a liability of the Trust) on a daily basis. The dollar
amount of the creation and development fee accrued each day, which will
vary with fluctuations in the Trust's net asset value, is determined by
multiplying the net asset value of the Trust on that day by 1/365 of the
annual creation and development fee of .35%. The total amount of any
accrued but unpaid creation and development fee is paid to the Sponsor
on a monthly basis from the assets of the Trust. If you redeem your
Units, you will only be responsible for any accrued and unpaid creation
and development fee through the date of redemption. In connection with
the creation and development fee, in no event will the Sponsor collect
more than 2.75% of a Unit holder's initial investment. We do not use
this fee to pay distribution expenses or as compensation for sales
efforts.
In addition to the Trust's operating expenses, and the fees described
above, the Trust may also incur the following charges:
- All legal expenses of the Trustee according to its responsibilities
under the Indenture;
- The expenses and costs incurred by the Trustee to protect the Trust
and your rights and interests;
- Fees for any extraordinary services the Trustee performed under the
Indenture;
- Payment for any loss, liability or expense the Trustee incurred
without negligence, bad faith or willful misconduct on its part, in
connection with its acceptance or administration of the Trust;
- Payment for any loss, liability or expenses we incurred without
negligence, bad faith or willful misconduct in acting as Depositor of
the Trust; and/or
- All taxes and other government charges imposed upon the Securities or
any part of the Trust.
The above expenses and the Trustee's annual fee are secured by a lien on
the Trust. Since dividend income on the Equity Securities is
unpredictable, we cannot guarantee that dividends will be sufficient to
meet any or all expenses of the Trust. If there is not enough cash in
the Income or Capital Account, the Trustee has the power to sell
Securities to make cash available to pay these charges which may result
in capital gains or losses to you. See "Tax Status." However, Treasury
Obligations will not be sold to pay expenses unless their sale will not
reduce the per Unit termination value below $10.
The Trust will be audited on an annual basis. So long as we are making a
secondary market for Units, we will bear the cost of these annual audits
to the extent the cost exceeds $0.0050 per Unit. Otherwise, the Trust
will pay for the audit. You can receive a copy of the audited financial
statements by notifying the Trustee.
Tax Status
This section summarizes some of the main U.S. federal income tax
consequences of owning Units of the Trust. This section is current as of
the date of this prospectus. Tax laws and interpretations change
frequently, and these summaries do not describe all of the tax
Page 17
consequences to all taxpayers. For example, these summaries generally do
not describe your situation if you are a non-U.S. person, a
broker/dealer, or other investor with special circumstances. In
addition, this section does not describe your state or foreign taxes. As
with any investment, you should consult your own tax professional about
your particular consequences.
Trust Status.
The Trust will not be taxed as a corporation for federal income tax
purposes. As a Unit owner, you will be treated as the owner of a pro
rata portion of the Securities and other assets held by the Trust, and
as such you will be considered to have received a pro rata share of
income (i.e., interest, dividends and capital gains, if any) from each
Security when such income is considered to be received by the Trust.
This is true even if you elect to have your distributions automatically
reinvested into additional Units. In addition, the income from the Trust
which you must take into account for federal income tax purposes is not
reduced by amounts used to pay Trust expenses (including the deferred
sales charge, if any).
Your Tax Basis and Income or Loss upon Disposition.
If your Trust disposes of Securities, you will generally recognize gain
or loss. If you dispose of your Units or redeem your Units for cash, you
will also generally recognize gain or loss. To determine the amount of
this gain or loss, you must subtract your tax basis in the related
Securities from your share of the total amount received in the
transaction. You can generally determine your initial tax basis in each
Security or other Trust asset by apportioning the cost of your Units,
generally including sales charges, among each Security or other Trust
asset ratably according to their value on the date you purchase your
Units. In certain circumstances, however, you may have to adjust your
tax basis after you purchase your Units. For example, you will have to
adjust your tax basis after you acquire your Units to reflect original
issue discount (and possibly market discount or premium), as discussed
below, or in the case of certain dividends that exceed a corporation's
accumulated earnings and profits.
If you are an individual, the maximum marginal federal tax rate for net
capital gain is generally 20% (10% for certain taxpayers in the lowest
tax bracket). Net capital gain equals net long-term capital gain minus
net short-term capital loss for the taxable year. Capital gain or loss
is long-term if the holding period for the asset is more than one year
and is short-term if the holding period for the asset is one year or
less. You must exclude the date you purchase your Units to determine the
holding period of your Units. The tax rates for capital gains realized
from assets held for one year or less are generally the same as for
ordinary income. The tax code may, however, treat certain capital gains
as ordinary income in special situations.
Discount, Accrued Interest and Premium.
The Treasury Obligations will generally be treated as having original
issue discount. This original issue discount is generally equal to the
difference between the amount payable on the due date and your purchase
price allocable to the Treasury Obligations. Original issue discount
accrues on a daily basis and is generally treated as interest income for
federal income tax purposes as it accrues. The basis of your Units and
of each Treasury Obligation must be increased as original issue discount
accrues. The rules relating to original issue discount are very complex
and special rules apply in numerous circumstances. You should consult
your tax advisor with respect to the accrual of original issue discount.
In-Kind Distributions.
Under certain circumstances, you may request a distribution of
Securities (an "In-Kind Distribution") when you redeem your Units
(except for Fee Accounts) or at the Trust's termination. If you request
an In-Kind Distribution you will be responsible for any expenses related
to this distribution. By electing to receive an In-Kind Distribution,
you will receive whole shares of stock and zero coupon U.S. Treasury
bonds plus, possibly, cash.
You will not recognize gain or loss if you only receive Securities in
exchange for your pro rata portion of the Securities held by a Trust.
However, if you also receive cash in exchange for a fractional share of
a Security held by a Trust, you will generally recognize gain or loss
based on the difference between the amount of cash you receive and your
tax basis in such fractional share of the Security.
Limitations on the Deductibility of Trust Expenses.
Generally, for federal income tax purposes, you must take into account
your full pro rata share of the Trust's income, even if some of that
income is used to pay Trust expenses. You may deduct your pro rata share
Page 18
of each expense paid by the Trust to the same extent as if you directly
paid the expense. You may, however, be required to treat some or all of
the expenses of the Trust as miscellaneous itemized deductions.
Individuals may only deduct certain miscellaneous itemized deductions to
the extent they exceed 2% of adjusted gross income.
State and Local Taxes.
Under the existing income tax laws of the State and City of New York,
the Trust will not be taxed as a corporation, and the income of the
Trust will be treated as the income of the Unit holders in the same
manner as for federal income tax purposes.
Retirement Plans
You may purchase Units of the Trust for:
- Individual Retirement Accounts
- Keogh Plans
- Pension funds, and
- Other tax-deferred retirement plans.
Generally, the federal income tax on capital gains and income received
in each of the above plans is deferred until you receive distributions.
These distributions are generally treated as ordinary income but may, in
some cases, be eligible for special averaging or tax-deferred rollover
treatment. Before participating in a plan like this, you should review
the tax laws regarding these plans and consult your attorney or tax
advisor. Brokerage firms and other financial institutions offer these
plans with varying fees and charges.
Rights of Unit Holders
Unit Ownership.
The Trustee will treat as Record Owner of Units persons registered as
such on its books. It is your responsibility to notify the Trustee when
you become Record Owner, but normally your broker/dealer provides this
notice. You may elect to hold your Units in either certificated or
uncertificated form. All Fee Accounts Units, however, will be held in
uncertificated form.
Certificated Units. When you purchase your Units, you can request that
they be evidenced by certificates, which will be delivered shortly after
your order. Certificates will be issued in fully registered form,
transferable only on the books of the Trustee in denominations of one
Unit or any multiple thereof. You can transfer or redeem your
certificated Units by endorsing and surrendering the certificate to the
Trustee, along with a written instrument of transfer. You must sign your
name exactly as it appears on the face of the certificate with your
signature guaranteed by an eligible institution. In certain cases the
Trustee may require additional documentation before they will transfer
or redeem your Units.
You may be required to pay a nominal fee to the Trustee for each
certificate reissued or transferred, and to pay any government charge
that may be imposed for each transfer or exchange. If a certificate gets
lost, stolen or destroyed, you may be required to furnish indemnity to
the Trustee to receive replacement certificates. You must surrender
mutilated certificates to the Trustee for replacement.
Uncertificated Units. You may also choose to hold your Units in
uncertificated form. If you choose this option, the Trustee will
establish an account for you and credit your account with the number of
Units you purchase. Within two business days of the issuance or transfer
of Units held in uncertificated form, the Trustee will send you:
- A written initial transaction statement containing a description of
your Trust;
- The number of Units issued or transferred;
- Your name, address and Taxpayer Identification Number ("TIN");
- A notation of any liens or restrictions of the issuer and any adverse
claims; and
- The date the transfer was registered.
Uncertificated Units may be transferred the same way as certificated
Units, except that no certificate needs to be presented to the Trustee.
Also, no certificate will be issued when the transfer takes place unless
you request it. You may at any time request that the Trustee issue
certificates for your Units.
Unit Holder Reports.
In connection with each distribution, the Trustee will provide you with
a statement detailing the per Unit amount of income (if any)
distributed. After the end of each calendar year, the Trustee will
provide you:
- A summary of transactions in the Trust for the year;
- A list of any Securities sold during the year and the Securities held
Page 19
at the end of that year by the Trust;
- The Redemption Price per Unit, computed on the 31st day of December of
such year (or the last business day before); and
- Amounts of income and capital distributed during the year.
You may request from the Trustee copies of the evaluations of the
Securities as prepared by the Evaluator to enable you to comply with
federal and state tax reporting requirements.
Income and Capital Distributions
You will begin receiving distributions on your Units only after you
become a Record Owner. The Trustee will credit any dividends received on
the Trust's Securities to the Income Account. All other receipts, such
as return of capital, are credited to the Capital Account.
The Trustee will distribute any net income in the Income Account on or
near the Income Distribution Dates to Unit holders of record on the
preceding Income Distribution Record Date. See "Summary of Essential
Information." No income distribution will be paid if accrued expenses of
the Trust exceed amounts in the Income Account on the Income
Distribution Dates. Distribution amounts will vary with changes in the
Trust's fees and expenses, in dividends received and with the sale of
Securities. Income from original issue discount on the Treasury
Obligations will not be distributed currently, but you will be subject
to federal income tax as if a distribution had occurred. See "Tax
Status." The Trustee will distribute amounts in the Capital Account, net
of amounts designated to meet redemptions, pay the deferred sales charge
or pay expenses, on the last day of each month to Unit holders of record
on the fifteenth day of each month provided the amount equals at least
$1.00 per 100 Units. If the Trustee does not have your TIN it is
required to withhold a certain percentage of your distribution and
deliver such amount to the Internal Revenue Service ("IRS"). You may
recover this amount by giving your TIN to the Trustee, or when you file
a tax return. However, you should check your statements to make sure the
Trustee has your TIN to avoid this "back-up withholding."
We anticipate that there will be enough money in the Capital Account to
pay the deferred sales charge. If not, the Trustee may sell Securities
to meet the shortfall. However, Treasury Obligations will not be sold to
pay the deferred sales charge unless their sale will not reduce the per
Unit termination value below $10.
Within a reasonable time after the Trust is terminated you will receive
a pro rata share of the money from the sale of the Securities. However,
if you are eligible, you may elect to receive an In-Kind Distribution as
described under "Amending or Terminating the Indenture." You will
receive a pro rata share of any other assets remaining in the Trust,
after deducting any unpaid expenses.
The Trustee may establish reserves (the "Reserve Account") within the
Trust to cover anticipated state and local taxes and any governmental
charges to be paid out of the Trust.
Redeeming Your Units
You may redeem all or a portion of your Units at any time by sending the
certificates representing the Units you want to redeem to the Trustee at
its unit investment trust office. If your Units are uncertificated, you
need only deliver a request for redemption to the Trustee. In either
case, the certificates or the redemption request must be properly
endorsed with proper instruments of transfer and signature guarantees as
explained in "Rights of Unit Holders-Unit Ownership" (or by providing
satisfactory indemnity if the certificates were lost, stolen, or
destroyed). No redemption fee will be charged, but you are responsible
for any governmental charges that apply. Three business days after the
day you tender your Units (the "Date of Tender") you will receive cash
in an amount for each Unit equal to the Redemption Price per Unit
calculated at the Evaluation Time on the Date of Tender.
The Date of Tender is considered to be the date on which the Trustee
receives your certificates or redemption request (if such day is a day
the NYSE is open for trading). However, if your certificates or
redemption request are received after 4:00 p.m. Eastern time (or after
any earlier closing time on a day on which the NYSE is scheduled in
advance to close at such earlier time), the Date of Tender is the next
day the NYSE is open for trading.
Any amounts paid on redemption representing income will be withdrawn
from the Income Account if funds are available for that purpose, or from
the Capital Account. All other amounts paid on redemption will be taken
Page 20
from the Capital Account. The IRS will require the Trustee to withhold a
portion of your redemption proceeds if the Trustee does not have your
TIN, as generally discussed under "Income and Capital Distributions."
If you tender 2,000 Units or more for redemption (except for Fee
Accounts), rather than receiving cash, you may elect to receive an In-
Kind Distribution in an amount equal to the Redemption Price per Unit by
making this request in writing to the Trustee at the time of tender.
However, no In-Kind Distribution requests submitted during the nine
business days prior to a Trust's Mandatory Termination Date will be
honored. Where possible, the Trustee will make an In-Kind Distribution
by distributing each of the Securities in book-entry form to your bank
or broker/dealer account at the Depository Trust Company. The Trustee
will subtract any customary transfer and registration charges from your
In-Kind Distribution. As a tendering Unit holder, you will receive your
pro rata number of whole shares of the Securities that make up the
portfolio, and cash from the Capital Account equal to the fractional
shares to which you are entitled.
The Trustee may sell Securities to make funds available for redemption.
However, Treasury Obligations will not be sold to the extent that it
affects the Trust's ability to pay its minimum maturity value at
termination. If Securities are sold, the size and diversification of the
Trust will be reduced. These sales may result in lower prices than if
the Securities were sold at a different time.
Your right to redeem Units (and therefore, your right to receive
payment) may be delayed:
- If the NYSE is closed (other than customary weekend and holiday
closings);
- If the SEC determines that trading on the NYSE is restricted or that
an emergency exists making sale or evaluation of the Securities not
reasonably practical; or
- For any other period permitted by SEC order.
The Trustee is not liable to any person for any loss or damage which may
result from such a suspension or postponement.
The Redemption Price.
The Redemption Price per Unit is determined by the Trustee by:
adding
1. cash in the Income and Capital Accounts not designated to purchase
Securities;
2. the aggregate underlying value of the Securities held in the Trust; and
3. dividends receivable on the Equity Securities trading ex-dividend as
of the date of computation; and
deducting
1. any applicable taxes or governmental charges that need to be paid out
of the Trust;
2. any amounts owed to the Trustee for its advances;
3. estimated accrued expenses of the Trust, if any;
4. cash held for distribution to Unit holders of record of the Trust as
of the business day before the evaluation being made; and
5. other liabilities incurred by the Trust; and
dividing
1. the result by the number of outstanding Units of the Trust.
Any remaining deferred sales charge on the Units when you redeem them
will be deducted from your redemption proceeds. In addition, until the
earlier of six months after the Initial Date of Deposit or the end of
the initial offering period, the Redemption Price per Unit will include
estimated organization costs as set forth under "Fee Table."
Removing Securities from the Trust
The portfolio of the Trust is not managed. However, we may, but are not
required to, direct the Trustee to dispose of an Equity Security in
certain limited circumstances, including situations in which:
- The issuer of an Equity Security defaults in the payment of a declared
dividend;
- Any action or proceeding prevents the payment of dividends;
- There is any legal question or impediment affecting an Equity Security;
- The issuer of an Equity Security has breached a covenant which would
affect the payment of dividends, the issuer's credit standing, or
otherwise damage the sound investment character of such Equity Security;
- The issuer has defaulted on the payment on any other of its
outstanding obligations;
- There has been a public tender offer made for an Equity Security or a
merger or acquisition is announced affecting an Equity Security, and
that in our opinion the sale or tender of the Equity Security is in the
Page 21
best interest of Unit holders; or
- The price of the Equity Security has declined to such an extent, or
such other credit factors exist, that in our opinion keeping the Equity
Security would be harmful to the Trust.
Except in the limited instance in which the Trust acquires Replacement
Securities, as described in "The FT Series," the Trust may not acquire
any securities or other property other than the Securities. The Trustee,
on behalf of the Trust, will reject any offer for new or exchanged
securities or property in exchange for a Security, such as those
acquired in a merger or other transaction. If such exchanged securities
or property are nevertheless acquired by the Trust, at our instruction,
they will either be sold or held in the Trust. In making the
determination as to whether to sell or hold the exchanged securities or
property we may get advice from the Portfolio Supervisor. Any proceeds
received from the sale of Securities, exchanged securities or property
will be credited to the Capital Account for distribution to Unit holders
or to meet redemption requests. The Trustee may retain and pay us or an
affiliate of ours to act as agent for the Trust to facilitate selling
Securities, exchanged securities or property from the Trust. If we or
our affiliate act in this capacity, we will be held subject to the
restrictions under the Investment Company Act of 1940, as amended.
The Trustee may sell Securities designated by us; or, absent our
direction, at its own discretion, in order to meet redemption requests
or pay expenses. Treasury Obligations will not be sold to meet
redemption requests or pay expenses unless their sale will not reduce
the per Unit termination value below $10. In designating Securities to
be sold, we will try to maintain the proportionate relationship among
the Securities. If this is not possible, the composition and
diversification of the Trust may be changed. To get the best price for
the Trust we may specify minimum amounts (generally 100 shares) in which
blocks of Securities are to be sold. We may consider sales of units of
unit investment trusts we sponsor when we make recommendations to the
Trustee as to which broker/dealers they select to execute the Trust's
portfolio transactions, or when acting as agent for the Trust in
acquiring or selling Securities on behalf of the Trust.
Amending or Terminating the Indenture
Amendments. The Indenture may be amended by us and the Trustee without
your consent:
- To cure ambiguities;
- To correct or supplement any defective or inconsistent provision;
- To make any amendment required by any governmental agency; or
- To make other changes determined not to be materially adverse to your
best interests (as determined by us and the Trustee).
Termination. As provided by the Indenture, the Trust will terminate on
the Mandatory Termination Date. The Trust may be terminated prior to the
Mandatory Termination Date:
- Upon the consent of 100% of the Unit holders; or
- In the event that Units of the Trust not yet sold aggregating more
than 60% of the Units of such Trust are tendered for redemption by
underwriters, including the Sponsor.
Prior to termination, the Trustee will send written notice to all Unit
holders which will specify how you should tender your certificates, if
any, to the Trustee. If the Trust is terminated due to this last reason,
we will refund your entire sales charge; however, termination of the
Trust before the Mandatory Termination Date for any other stated reason
will result in all remaining unpaid deferred sales charges on your Units
being deducted from your termination proceeds.
Unless terminated earlier, the Trustee will begin to sell Equity
Securities in connection with the termination of the Trust during the
period beginning nine business days prior to, and no later than, the
Mandatory Termination Date. We will determine the manner and timing of
the sale of Equity Securities. Because the Trustee must sell the Equity
Securities within a relatively short period of time, the sale of Equity
Securities as part of the termination process may result in a lower
sales price than might otherwise be realized if such sale were not
required at this time.
If you own at least 2,000 Units of the Trust the Trustee will send you a
form at least 30 days prior to the Mandatory Termination Date which will
enable you to receive an In-Kind Distribution (reduced by customary
transfer and registration charges) rather than the typical cash
Page 22
distribution. See "Tax Status" for additional information. You must
notify the Trustee at least ten business days prior to the Mandatory
Termination Date if you elect this In-Kind Distribution option. If you
do not elect to participate in the In-Kind Distribution option, you will
receive a cash distribution from the sale of the remaining Securities,
along with your interest in the Income and Capital Accounts, within a
reasonable time after the Trust is terminated. Regardless of the
distribution involved, the Trustee will deduct from the Trust any
accrued costs, expenses, advances or indemnities provided for by the
Indenture, including estimated compensation of the Trustee and costs of
liquidation and any amounts required as a reserve to pay any taxes or
other governmental charges.
Information on the Sponsor, Trustee and Evaluator
The Sponsor.
We, Nike Securities L.P., specialize in the underwriting, trading and
wholesale distribution of unit investment trusts under the "First Trust"
brand name and other securities. An Illinois limited partnership formed
in 1991, we act as Sponsor for successive series of:
- The First Trust Combined Series
- FT Series (formerly known as The First Trust Special Situations Trust)
- The First Trust Insured Corporate Trust
- The First Trust of Insured Municipal Bonds
- The First Trust GNMA
First Trust introduced the first insured unit investment trust in 1974.
To date we have deposited more than $27 billion in First Trust unit
investment trusts. Our employees include a team of professionals with
many years of experience in the unit investment trust industry.
We are a member of the National Association of Securities Dealers, Inc.
and Securities Investor Protection Corporation. Our principal offices
are at 1001 Warrenville Road, Lisle, Illinois 60532; telephone number
(630) 241-4141. As of December 31, 1999, the total partners' capital of
Nike Securities L.P. was $19,881,035 (audited).
This information refers only to us and not to the Trust or to any series
of the Trust or to any other dealer. We are including this information
only to inform you of our financial responsibility and our ability to
carry out our contractual obligations. We will provide more detailed
financial information on request.
Code of Ethics. The Sponsor and the Trust have adopted a code of ethics
requiring the Sponsor's employees who have access to information on
Trust transactions to report personal securities transactions. The
purpose of the code is to avoid potential conflicts of interest and to
prevent fraud, deception or misconduct with respect to the Trust.
The Trustee.
The Trustee is The Chase Manhattan Bank, with its principal executive
office located at 270 Park Avenue, New York, New York 10017 and its unit
investment trust office at 4 New York Plaza, 6th Floor, New York, New
York, 10004-2413. If you have questions regarding the Trust, you may
call the Customer Service Help Line at 1-800-682-7520. The Trustee is
supervised by the Superintendent of Banks of the State of New York, the
Federal Deposit Insurance Corporation and the Board of Governors of the
Federal Reserve System.
The Trustee has not participated in selecting the Securities; it only
provides administrative services.
Limitations of Liabilities of Sponsor and Trustee.
Neither we nor the Trustee will be liable for taking any action or for
not taking any action in good faith according to the Indenture. We will
also not be accountable for errors in judgment. We will only be liable
for our own willful misfeasance, bad faith, gross negligence (ordinary
negligence in the Trustee's case) or reckless disregard of our
obligations and duties. The Trustee is not liable for any loss or
depreciation when the Securities are sold. If we fail to act under the
Indenture, the Trustee may do so, and the Trustee will not be liable for
any action it takes in good faith under the Indenture.
The Trustee will not be liable for any taxes or other governmental
charges or interest on the Securities which the Trustee may be required
to pay under any present or future law of the United States or of any
other taxing authority with jurisdiction. Also, the Indenture states
other provisions regarding the liability of the Trustee.
If we do not perform any of our duties under the Indenture or are not
able to act or become bankrupt, or if our affairs are taken over by
public authorities, then the Trustee may:
Page 23
- Appoint a successor sponsor, paying them a reasonable rate not more
than that stated by the SEC,
- Terminate the Indenture and liquidate the Trust, or
- Continue to act as Trustee without terminating the Indenture.
The Evaluator.
The Evaluator is First Trust Advisors L.P., an Illinois limited
partnership formed in 1991 and an affiliate of the Sponsor. The
Evaluator's address is 1001 Warrenville Road, Lisle, Illinois 60532.
The Trustee, Sponsor and Unit holders may rely on the accuracy of any
evaluation prepared by the Evaluator. The Evaluator will make
determinations in good faith based upon the best available information,
but will not be liable to the Trustee, Sponsor or Unit holders for
errors in judgment.
Other Information
Legal Opinions.
Our counsel is Chapman and Cutler, 111 W. Monroe St., Chicago, Illinois,
60603. They have passed upon the legality of the Units offered hereby
and certain matters relating to federal tax law. Carter, Ledyard &
Milburn acts as the Trustee's counsel, as well as special New York tax
counsel for the Trust.
Experts.
Ernst & Young LLP, independent auditors, have audited the Trust's
statement of net assets, including the schedule of investments, at the
opening of business on the Initial Date of Deposit, as set forth in
their report. We've included the Trust's statement of net assets,
including the schedule of investments, in the prospectus and elsewhere
in the registration statement in reliance on Ernst & Young LLP's report,
given on their authority as experts in accounting and auditing.
Supplemental Information.
If you write or call the Trustee, you will receive free of charge
supplemental information about this Series, which has been filed with
the SEC and to which we have referred throughout. This information
states more specific details concerning the nature, structure and risks
of this product.
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Page 27
FIRST TRUST (registered trademark)
Watchman Growth and Treasury Securities Portfolio, Series 2
FT 450
Sponsor:
NIKE SECURITIES L.P.
1001 Warrenville Road, Suite 300
Lisle, Illinois 60532
1-630-241-4141
Trustee:
THE CHASE MANHATTAN BANK
4 New York Plaza, 6th floor
New York, New York 10004-2413
1-800-682-7520
24-Hour Pricing Line:
1-800-446-0132
This prospectus contains information relating to Watchman Growth and
Treasury Securities Portfolio, Series 2, but does not contain all of the
information about this investment company as filed with the Securities
and Exchange Commission in Washington, D.C. under the:
- Securities Act of 1933 (file no. 333-42674) and
- Investment Company Act of 1940 (file no. 811-05903)
Information about the Trust can be reviewed and copied at the Securities
and Exchange Commission's Public Reference Room in Washington D.C.
Information regarding the operation of the Commission's Public Reference
Room may be obtained by calling the Commission at 1-202-942-8090.
Information about the Trust is available on the EDGAR Database on the
Commission's Internet site at http://www.sec.gov.
To obtain copies at prescribed rates -
Write: Public Reference Section of the Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0102
e-mail address: [email protected]
August 22, 2000
PLEASE RETAIN THIS PROSPECTUS FOR FUTURE REFERENCE
Page 28
First Trust (registered trademark)
The FT Series
Information Supplement
This Information Supplement provides additional information concerning
the structure, operations and risks of the unit investment trust
contained in FT 450 not found in the prospectus for the Trust. This
Information Supplement is not a prospectus and does not include all of
the information you should consider before investing in the Trust. This
Information Supplement should be read in conjunction with the prospectus
for the Trust in which you are considering investing.
This Information Supplement is dated August 22, 2000. Capitalized terms
have been defined in the prospectus.
Table of Contents
Risk Factors
Securities 1
Dividends 1
Treasury Obligations 1
Risk Factors
Securities. An investment in Units should be made with an understanding
of the risks which an investment in common stocks entails, including the
risk that the financial condition of the issuers of the Securities or
the general condition of the relevant stock market may worsen, and the
value of the Securities and therefore the value of the Units may
decline. Common stocks are especially susceptible to general stock
market movements and to volatile increases and decreases of value, as
market confidence in and perceptions of the issuers change. These
perceptions are based on unpredictable factors, including expectations
regarding government, economic, monetary and fiscal policies, inflation
and interest rates, economic expansion or contraction, and global or
regional political, economic or banking crises. Both U.S. and foreign
markets have experienced substantial volatility and significant declines
recently as a result of certain or all of these factors.
Dividends. Shareholders of common stocks have rights to receive payments
from the issuers of those common stocks that are generally subordinate
to those of creditors of, or holders of debt obligations or preferred
stocks of, such issuers. Common stocks do not represent an obligation of
the issuer and, therefore, do not offer any assurance of income or
provide the same degree of protection of capital as do debt securities.
The issuance of additional debt securities or preferred stock will
create prior claims for payment of principal, interest and dividends
which could adversely affect the ability and inclination of the issuer
to declare or pay dividends on its common stock or the rights of holders
of common stock with respect to assets of the issuer upon liquidation or
bankruptcy.
Treasury Obligations. An investment in Units should be made with an
understanding of the risks which an investment in zero coupon U.S.
Treasury Obligations entails. Such Treasury Obligations are purchased at
a deep discount because the buyer obtains only the right to a fixed
payment at a fixed date in the future and does not receive any periodic
interest payments. The effect of owning deep discount bonds which do not
make current interest payments (such as the Treasury Obligations) is
that a fixed yield is earned not only on the original investment, but
also, in effect, on all earnings during the life of the discount
obligation. This implicit reinvestment of earnings at the same rate
eliminates the risk of being unable to reinvest the income on such
obligations at a rate as high as the implicit yield on the discount
obligation, but at the same time eliminates the holder's ability to
reinvest at higher rates in the future. For this reason, the Treasury
Obligations are subject to substantially greater price fluctuations
during periods of changing interest rates than are securities of
comparable quality which make regular interest payments.
Page 1
CONTENTS OF REGISTRATION STATEMENT
A. Bonding Arrangements of Depositor:
Nike Securities L.P. is covered by a Brokers' Fidelity Bond,
in the total amount of $1,000,000, the insurer being
National Union Fire Insurance Company of Pittsburgh.
B. This Registration Statement on Form S-6 comprises the
following papers and documents:
The facing sheet
The Prospectus
The signatures
Exhibits
S-1
SIGNATURES
The Registrant, FT 450, hereby identifies The First Trust
Special Situations Trust, Series 4; The First Trust Special
Situations Trust, Series 18; The First Trust Special Situations
Trust, Series 69; The First Trust Special Situations Trust,
Series 108; The First Trust Special Situations Trust, Series 119;
The First Trust Special Situations Trust, Series 190; FT 286; The
First Trust Combined Series 272; FT 412; and FT 438 for purposes
of the representations required by Rule 487 and represents the
following:
(1) that the portfolio securities deposited in the series
as to the securities of which this Registration Statement is
being filed do not differ materially in type or quality from
those deposited in such previous series;
(2) that, except to the extent necessary to identify the
specific portfolio securities deposited in, and to provide
essential financial information for, the series with respect to
the securities of which this Registration Statement is being
filed, this Registration Statement does not contain disclosures
that differ in any material respect from those contained in the
registration statements for such previous series as to which the
effective date was determined by the Commission or the staff; and
(3) that it has complied with Rule 460 under the Securities
Act of 1933.
Pursuant to the requirements of the Securities Act of 1933,
the Registrant, FT 450, has duly caused this Amendment to
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the Village of Lisle
and State of Illinois on August 22, 2000.
FT 450
By NIKE SECURITIES L.P.
Depositor
By Robert M. Porcellino
Senior Vice President
S-2
Pursuant to the requirements of the Securities Act of 1933,
this Amendment to the Registration Statement has been signed
below by the following person in the capacity and on the date
indicated:
NAME TITLE* DATE
David J. Allen Sole Director )
of Nike Securities )
Corporation, the ) August 22, 2000
General Partner of )
Nike Securities L.P. )
)
)
) Robert M. Porcellino
) Attorney-in-Fact**
)
)
* The title of the person named herein represents his
capacity in and relationship to Nike Securities L.P.,
Depositor.
** An executed copy of the related power of attorney
was filed with the Securities and Exchange Commission in
connection with the Amendment No. 1 to Form S-6 of The
First Trust Combined Series 258 (File No. 33-63483) and
the same is hereby incorporated herein by this reference.
S-3
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption
"Experts" and to the use of our report dated August 22, 2000 in
Amendment No. 2 to the Registration Statement (Form S-6) (File
No. 333-42674) and related Prospectus of FT 450.
ERNST & YOUNG LLP
Chicago, Illinois
August 22, 2000
CONSENTS OF COUNSEL
The consents of counsel to the use of their names in the
Prospectus included in this Registration Statement will be
contained in their respective opinions to be filed as Exhibits
3.1, 3.2, 3.3 and 3.4 of the Registration Statement.
CONSENT OF FIRST TRUST ADVISORS L.P.
The consent of First Trust Advisors L.P. to the use of its
name in the Prospectus included in the Registration Statement
will be filed as Exhibit 4.1 to the Registration Statement.
S-4
EXHIBIT INDEX
1.1 Form of Standard Terms and Conditions of Trust for The
First Trust Special Situations Trust, Series 18 and
certain subsequent Series, effective October 15, 1991
among Nike Securities L.P., as Depositor, United States
Trust Company of New York as Trustee, Securities
Evaluation Service, Inc., as Evaluator, and First Trust
Advisors L.P. as Portfolio Supervisor (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
43683] filed on behalf of The First Trust Special
Situations Trust, Series 18).
1.1.1 Form of Trust Agreement for FT 450 among Nike Securities
L.P., as Depositor, The Chase Manhattan Bank, as
Trustee, First Trust Advisors L.P., as Evaluator, and
First Trust Advisors L.P., as Portfolio Supervisor.
1.2 Copy of Certificate of Limited Partnership of Nike
Securities L.P. (incorporated by reference to Amendment
No. 1 to Form S-6 [File No. 33-42683] filed on behalf of
The First Trust Special Situations Trust, Series 18).
1.3 Copy of Amended and Restated Limited Partnership
Agreement of Nike Securities L.P. (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
42683] filed on behalf of The First Trust Special
Situations Trust, Series 18).
1.4 Copy of Articles of Incorporation of Nike Securities
Corporation, the general partner of Nike Securities
L.P., Depositor (incorporated by reference to Amendment
No. 1 to Form S-6 [File No. 33-42683] filed on behalf of
The First Trust Special Situations Trust, Series 18).
1.5 Copy of By-Laws of Nike Securities Corporation, the
general partner of Nike Securities L.P., Depositor
(incorporated by reference to Amendment No. 1 to Form S-
6 [File No. 33-42683] filed on behalf of The First Trust
Special Situations Trust, Series 18).
1.6 Underwriter Agreement (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-45055] filed on
behalf of The First Trust Special Situations Trust,
Series 19).
2.1 Copy of Certificate of Ownership (included in Exhibit
1.1 filed herewith on page 2 and incorporated herein by
reference).
2.2 Copy of Code of Ethics (incorporated by reference to
Amendment No. 1 to form S-6 [File No. 333-31176] filed
on behalf of FT 415).
S-5
3.1 Opinion of counsel as to legality of securities being
registered.
3.2 Opinion of counsel as to Federal income tax status of
securities being registered.
3.3 Opinion of counsel as to New York income tax status of
securities being registered.
3.4 Opinion of counsel as to advancement of funds by
Trustee.
4.1 Consent of First Trust Advisors L.P.
6.1 List of Directors and Officers of Depositor and other
related information (incorporated by reference to
Amendment No. 1 to Form S-6 [File No. 33-42683] filed on
behalf of The First Trust Special Situations Trust,
Series 18).
7.1 Power of Attorney executed by the Director listed on
page S-3 of this Registration Statement (incorporated by
reference to Amendment No. 1 to Form S-6 [File No. 33-
63483] filed on behalf of The First Trust Combined
Series 258).
S-6
