REGISTRATION NO. 333-48804
CIK# 1117952
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
AMENDMENT NO. 1
TO
REGISTRATION STATEMENT
ON
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:
RANSON UNIT INVESTMENT TRUSTS, SERIES 99
B. NAME OF DEPOSITOR:
RANSON & ASSOCIATES, INC.
C. COMPLETE ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES:
Ranson & Associates, Inc.
250 North Rock Road, Suite 150
Wichita, Kansas 67206-2241
D. NAME AND COMPLETE ADDRESS OF AGENT FOR SERVICE:
Copy to:
ALEX R. MEITZNER MARK J. KNEEDY
Ranson & Associates, Inc. c/o Chapman and Cutler
250 North Rock Road, Suite 150 111 West Monroe Street
Wichita, Kansas 67206-2241 Chicago, Illinois 60603
E. TITLE OF SECURITIES BEING REGISTERED: Units of Beneficial Interest
E. APPROXIMATE DATE OF PROPOSED SALE TO PUBLIC:
As soon as practicable after the effective date
of the Registration Statement.
[X] Check box if it is proposed that this filing will become effective at
2:00 P.M. on November 2, 2000 pursuant to paragraph (b) of Rule 487.
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The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
[LOGO] RANSON UNIT INVESTMENT TRUSTS, SERIES 99
NASDAQ-100 INDEX TRUST, SERIES 10
A portfolio of the stocks in the Nasdaq-100 Index(R)
seeking capital appreciation
Prospectus
November 2, 2000
As with any investment, the Securities and Exchange Commission has not
approved or disapproved of these securities or passed upon the adequacy or
accuracy of this prospectus. Any contrary representation is a criminal offense.
<PAGE>
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INVESTMENT SUMMARY
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INVESTMENT OBJECTIVE
The trust seeks to provide investment results that correspond to the total
return of the stocks in the Nasdaq-100 Index over its life. Total return
includes any increase or decrease in the value of stocks plus any dividend
income.
INVESTMENT STRATEGY
The trust seeks to replicate the Nasdaq-100 Index by holding all, or a
representative sample, of the stocks that comprise the index. The Nasdaq-100
Index includes stocks of 100 of the largest and most-active non-financial
domestic and international companies trading on the Nasdaq Stock Market. Under
normal market conditions, the performance correlation between the portfolio and
the index will be between 97% and 99%. We may adjust the portfolio stocks
periodically to match any changes in the index. The portfolio will include at
least 95% of the stocks in the index. In an effort to lower trust expenses, we
may initially deposit an equal number shares of each stock in the portfolio.
Within 30 days we will align the portfolio with the index composition as we
create additional units. We will then maintain the portfolio as described
above.
<TABLE>
<CAPTION>
-------------------------------------
INDEX DIVERSIFICATION
-------------------------
<S> <C>
Telecommunications 24%
Semiconductors 15%
Software 14%
Internet 12%
Retail 6%
Biotechnology 5%
Computers 5%
Commercial Services 4%
Media 4%
Electronics 3%
Healthcare 3%
Basic Materials 2%
Industrials 2%
Transportation 1%
-------------------------------------
</TABLE>
PRINCIPAL RISKS
As with all investments, you can lose money by investing in this trust. The
trust also might not perform as well as you expect. This can happen for reasons
such as these:
* STOCK PRICES CAN BE VOLATILE. The value of your investment may fall over
time.
* WE DO NOT ACTIVELY MANAGE THE PORTFOLIO. The trust will seek to replicate
the Nasdaq-100 Index even if the index performance declines.
* Many of the stocks in the index are issued by technology companies. These
companies include companies involved in computers, electronics, the
Internet, semiconductors, software and telecommunications. NEGATIVE
DEVELOPMENTS IN THE TECHNOLOGY INDUSTRY WILL AFFECT THE VALUE OF YOUR
INVESTMENT GREATER THAN IN A MORE DIVERSIFIED INVESTMENT. Technology
stocks tend to experience above-average price volatility.
* All index portfolios have operating expenses and transaction costs. THIS
MEANS THAT AN INDEX PORTFOLIO MAY NOT TRACK ITS INDEX EXACTLY. It may be
impractical to own all index stocks in the exact index weightings. Time
may also elapse between a change in the index and a change in the
portfolio.
2 Investment Summary
<PAGE>
WHO SHOULD INVEST
You should consider this investment if you want:
* to own the stocks in the Nasdaq-100 Index in a single investment.
* the potential to increase the value of your money over the long term.
You should not consider this investment if you:
* are uncomfortable with the risks of an unmanaged investment in stocks.
* want current income, capital preservation or a short term investment.
<TABLE>
<CAPTION>
-----------------------------------------------------------------
ESSENTIAL INFORMATION
---------------------
<S> <C>
UNIT PRICE AT INCEPTION $10.00
INCEPTION DATE November 2, 2000
TERMINATION DATE November 2, 2006
DISTRIBUTION DATES 15th day of January, April,
July and October
RECORD DATES 1st day of January, April,
July and October
CUSIP NUMBERS
Cash distributions 753269646
Reinvested distributions 753269653
MINIMUM INVESTMENT
Standard accounts $1,000/100 units
Retirement accounts and
custodial accounts for minors $250/25 units
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</TABLE>
FEES AND EXPENSES
As with any investment, you will incur expenses when you invest in the trust.
The amounts below are estimates of the direct and indirect expenses that you may
incur based on a $10 unit price. Actual expenses may vary.
<TABLE>
<CAPTION>
AS A % OF
$1,000 INVESTED
---------------
<S> <C>
MAXIMUM SALES FEE
(% of unit price paid on purchase) 4.90%
=====
ORGANIZATION COSTS
(amount per 100 units paid by trust at
end of initial offering period) $5.00
=====
<CAPTION>
ANNUAL AS A % OF AMOUNT PER
OPERATING EXPENSES $1,000 INVESTED 100 UNITS
--------------- ----------
<S> <C> <C>
Trustee's fee and expenses 0.09% $0.90
Creation and development fee 0.25% 2.50
Licensing fee 0.02% 0.20
Supervisory and evaluation fees 0.06% 0.60
----- -----
Total 0.42% $4.20
===== =====
</TABLE>
The creation and development fee compensates the sponsor for creating and
developing your trust. The Trust accrues this fee daily during the life of the
Trust based on average daily net asset value and pays the sponsor monthly (not
to exceed 2.35 percent of your initial investment over the life of the trust).
EXAMPLE
This example helps you compare the cost of investing in this trust with the
cost of investing in other unit trusts and mutual funds. In the example we
assume that the expenses above do not change and that the trust's annual return
is 5%. The example only illustrates the effect of expenses-your actual returns
and expenses will vary. Based on these assumptions, you would pay these
expenses for every $10,000 you invest in the trust:
1 year $584
3 years $675
5 years $774
Life of trust (6 years) $826
These amounts are the same regardless of whether you sell your investment at
the end of a period or continue to hold your investment.
Investment Summary 3
<PAGE>
<TABLE>
<CAPTION>
THE PORTFOLIO (at inception)
Target
Portfolio Ticker Initial Cost to Percentage
Number Symbol Company Name Shares Portfolio of Index
--------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1 MSFT MICROSOFT CORP 122 $8,494.25 6.78%
2 CSCO CISCO SYSTEMS INC 152 7,923.00 6.43
3 INTC INTEL CORP 155 6,955.63 5.66
4 ORCL ORACLE CORPORATION 159 4,988.63 4.06
5 SUNW SUN MICROSYSTEMS INC 46 4,870.25 3.92
6 JDSU JDS UNIPHASE CORP 53 4,163.81 3.43
7 QCOM QUALCOMM INC 64 3,944.00 3.21
8 VRTS VERITAS SOFTWARE CORP 26 3,721.25 2.96
9 SEBL SIEBEL SYSTEMS INC 30 3,273.75 2.60
10 NTAP NETWORK APPLIANCE INC 22 2,415.88 1.99
11 JNPR JUNIPER NETWORKS INC 13 2,383.88 1.90
12 ITWO I2 TECHNOLOGIES INC 13 2,229.50 1.76
13 NXTL NEXTEL COMMUNICATIONS INC-A 59 2,168.25 1.75
14 CIEN CIENA CORP 19 2,022.31 1.69
15 VSTR VOICESTREAM WIRELESS CORP 16 1,973.25 1.65
16 IMNX IMMUNEX CORP 46 1,986.63 1.57
17 XLNX XILINX INC 28 1,888.25 1.57
18 DELL DELL COMPUTER CORP 63 1,917.56 1.51
19 BRCM BROADCOM CORP-CL A 8 1,722.63 1.47
20 PMCS PMC - SIERRA INC 11 1,760.86 1.47
21 GMST GEMSTAR-TV GUIDE INTL INC 26 1,794.00 1.46
22 AMGN AMGEN INC 29 1,750.42 1.39
23 ARBA ARIBA INC 14 1,687.22 1.36
24 MXIM MAXIM INTEGRATED PRODUCTS 26 1,677.00 1.36
25 WCOM WORLDCOM INC 89 1,685.44 1.35
26 LLTC LINEAR TECHNOLOGY CORP 27 1,672.31 1.33
27 VRSN VERISIGN INC 12 1,527.75 1.23
28 GBLX GLOBAL CROSSING LTD 63 1,441.13 1.20
29 AMAT APPLIED MATERIALS INC 28 1,435.00 1.13
30 ALTR ALTERA CORPORATION 41 1,335.06 1.11
31 PAYX PAYCHEX INC 25 1,348.44 1.08
32 AMCC APPLIED MICRO CIRCUITS CORP 17 1,251.63 1.03
33 SDLI SDL INC 5 1,232.50 1.02
34 CMCSK COMCAST CORP-SPECIAL CL A 30 1,222.50 0.98
35 CMVT COMVERSE TECHNOLOGY INC 10 1,172.50 0.98
36 ADCT ADC TELECOMMUNICATIONS INC 53 1,175.94 0.94
37 PSFT PEOPLESOFT INC 27 1,203.19 0.94
38 ADBE ADOBE SYSTEMS INC 15 1,158.75 0.91
39 SANM SANMINA CORP 10 1,081.41 0.87
40 ERICY ERICSSON (LM) TEL-SP ADR 72 999.00 0.80
41 MEDI MEDIMMUNE INC 15 1,005.00 0.78
42 INTU INTUIT INC 14 945.00 0.76
43 YHOO YAHOO! INC 15 965.39 0.76
44 VTSS VITESSE SEMICONDUCTOR CORP 12 830.44 0.67
45 CHIR CHIRON CORP 18 774.00 0.61
46 LVLT LEVEL 3 COMMUNICATIONS INC 17 723.56 0.61
47 DISH ECHOSTAR COMMUNICATIONS - A 16 755.00 0.59
48 SBUX STARBUCKS CORP 17 757.56 0.58
49 BGEN BIOGEN INC 12 718.50 0.56
50 EBAY EBAY INC 12 648.19 0.54
4 Investment Summary
<PAGE>
<CAPTION>
Target
Portfolio Ticker Initial Cost to Percentage
Number Symbol Company Name Shares Portfolio of Index
--------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
51 TLAB TELLABS INC 14 $694.75 0.54%
52 CEFT CONCORD EFS INC 16 687.00 0.52
53 BBBY BED BATH & BEYOND INC 24 634.50 0.50
54 MFNX METROMEDIA FIBER NETWORK-A 29 619.88 0.50
55 CTAS CINTAS CORP 13 590.69 0.49
56 AAPL APPLE COMPUTER INC 29 594.50 0.48
57 MCLD MCLEODUSA INC-CL A 31 567.69 0.47
58 XOXO XO COMMUNICATIONS INC-A 17 588.63 0.46
59 BMET BIOMET INC 15 543.98 0.45
60 COST COSTCO WHOLESALE CORP 15 536.25 0.44
61 AMZN AMAZON.COM INC 14 523.25 0.43
62 BVSN BROADVISION INC 17 535.50 0.43
63 FISV FISERV INC 10 523.75 0.43
64 QLGC QLOGIC CORP 6 573.75 0.43
65 GENZ GENZYME CORP - GENL DIVISION 7 512.75 0.41
66 KLAC KLA-TENCOR CORPORATION 15 492.19 0.38
67 ERTS ELECTRONIC ARTS INC 9 431.44 0.36
68 USAI USA NETWORKS INC 23 484.44 0.36
69 SPOT PANAMSAT CORP 13 442.81 0.34
70 CNXT CONEXANT SYSTEMS INC 15 380.63 0.32
71 MOLX MOLEX INC 7 372.31 0.30
72 CMGI CMGI INC 18 372.38 0.28
73 ATML ATMEL CORP 23 326.31 0.26
74 CTXS CITRIX SYSTEMS INC 14 319.38 0.25
75 PMTC PARAMETRIC TECHNOLOGY CORP 24 289.50 0.24
76 CNET CNET NETWORKS INC 8 264.00 0.22
77 ADLAC ADELPHIA COMMUNICATIONS-CL A 8 266.00 0.21
78 SPLS STAPLES INC 17 249.69 0.21
79 PCAR PACCAR INC 6 256.41 0.20
80 BMCS BMC SOFTWARE INC 12 248.44 0.19
81 APCC AMERICAN POWER CONVERSION 17 223.39 0.18
82 NOVL NOVELL INC 25 223.44 0.18
83 COMS 3COM CORP 12 206.06 0.17
84 DLTR DOLLAR TREE STORES INC 5 196.88 0.17
85 SIAL SIGMA-ALDRICH 6 215.63 0.17
86 APOL APOLLO GROUP INC-CL A 5 193.44 0.16
87 MCHP MICROCHIP TECHNOLOGY INC 7 201.69 0.16
88 RFMD RF MICRO DEVICES INC 9 189.00 0.16
89 SSCC SMURFIT-STONE CONTAINER CORP 15 195.94 0.16
90 ATHM AT HOME CORP -SER A 17 189.13 0.15
91 NETA NETWORK ASSOCIATES INC 9 175.50 0.14
92 RNWK REALNETWORKS INC 8 169.00 0.14
93 SNPS SYNOPSYS INC 5 175.63 0.13
94 QTRN QUINTILES TRANSNATIONAL CORP 11 158.13 0.12
95 NWAC NORTHWEST AIRLINES CORP 5 141.25 0.10
96 CPWR COMPUWARE CORP 14 110.25 0.09
97 MLHR MILLER (HERMAN) INC 5 132.19 0.08
98 ADPT ADAPTEC INC 5 75.00 0.06
99 LGTO LEGATO SYSTEMS INC 7 62.13 0.05
100 PHSY PACIFICARE HEALTH SYSTEMS 5 50.31 0.02
----------- -------
$123,984.19 100.00%
=========== =======
</TABLE>
Investment Summary 5
<PAGE>
-----------------------------
UNDERSTANDING YOUR INVESTMENT
-----------------------------
HOW TO BUY UNITS
You can buy units of the trust on any business day by contacting your
financial professional or Ranson. Unit prices are available daily on the
Internet at WWW.RANSON.COM. The unit price includes:
* the value of the stocks,
* the sales fee, and
* cash and other net assets in the portfolio.
We often refer to the purchase price of units as the "offer price." We must
receive your order to buy units prior to the close of the New York Stock
Exchange (normally 4:00 p.m. Eastern time) to give you the price for that day.
If we receive your order after this time, you will receive the price computed on
the next business day.
RETIREMENT ACCOUNTS. The portfolio may be suitable for purchase in tax-
advantaged retirement accounts. You should contact your financial professional
about the accounts offered and any additional fees imposed. In addition, you
can invest in a Ranson UIT retirement account directly with the trustee. We
reduce the minimum investment to only $250 for these accounts. Please contact
The Bank of New York for more information and an application. The trustee will
assess an annual fee per account (currently $12) which can be deducted from your
account if do not wish to pay it separately.
VALUE OF THE STOCKS. We determine the value of the stocks as of the close of
the New York Stock Exchange on each day that exchange is open. During the
initial offering period, the value of the stocks includes organization costs.
Pricing the Stocks. We generally determine the value of stocks using the
last sale price for stocks traded on a national securities exchange or the
Nasdaq Stock Market. In some cases we will price a stock based on the last
asked or bid price in the over-the-counter market or by using other recognized
pricing methods. We will only do this if a stock is not principally traded on a
national securities exchange or the Nasdaq Stock Market, or if the market quotes
are unavailable or inappropriate.
The trustee determined the initial prices of the stocks shown in "The
Portfolio" in this prospectus. The trustee determined these initial prices as
described above at the close of the New York Stock Exchange on the business day
before the date of this prospectus. On the first day we sell units we will
compute the unit price as of the close of the New York Stock Exchange or the
time the registration statement filed with the Securities and Exchange
Commission becomes effective, if later.
Organization Costs. During the initial offering period, part of the value of
the stocks represents an amount that will pay the costs of creating your trust.
These costs include the costs of preparing the registration statement and legal
documents, federal and state registration fees, the initial fees and expenses of
the trustee and the initial audit. Your trust will sell stocks to reimburse us
for these costs at the end of the initial offering period or after six months,
if earlier.
SALES FEE. You pay a fee when you buy units. The total fee equals 4.90% of
your unit price at the time of purchase.
6 Understanding Your Investment
<PAGE>
REDUCING YOUR SALES FEE. We offer a variety of ways for you to reduce the
fee you pay. It is your financial professional's responsibility to alert us of
any discount when you order units.
Large Purchases. You can reduce your fee by increasing the size of your
investment:
<TABLE>
<CAPTION>
If you purchase: Your fee will be:
---------------- -----------------
<S> <C>
Less than $100,000 4.90%
$100,000 - $249,999 4.50
$250,000 - $499,999 4.30
$500,000 - $999,999 3.50
$1,000,000 or more 3.00
</TABLE>
We apply these fees as a percent of the unit price at the time of purchase.
We also apply the different purchase levels on a unit basis using a $10 unit
equivalent. For example, if you purchase between 10,000 and 24,999 units, your
fee is 4.50% of your unit price.
You may AGGREGATE unit purchases by the same person on any single day from
any one broker-dealer to qualify for a purchase level. You can include these
purchases as your own for purposes of this aggregation:
* purchases by your spouse or minor children and
* purchases by your trust estate or fiduciary accounts.
You may also use a LETTER OF INTENT to combine purchases over time to qualify
for a purchase level. Under this option, you must give us a letter of intent to
purchase a specified amount of units of any Ranson unit trust over a specified
time period. The letter must specify a time period of no more than 13 months.
Once you sign a letter of intent, we will reduce your fee based on your total
purchase commitment as shown in the table above. If your purchases exceed the
level specified in your letter, you will still receive the additional fee
reduction for your purchases shown in the table above (we will not cap your
discount). If your total purchases are less than the level specified in your
letter, you must pay the fee difference to us. We reserve the right to redeem
your units if you do not pay the difference.
The discounts described above apply only during the initial offering period.
Advisory and Wrap Fee Accounts. We reduce your sales fee for purchases made
through registered investment advisers, certified financial planners or
registered broker-dealers who charge periodic fees in lieu of commissions or who
charge for financial planning or for investment advisory or asset management
services or provide these services as part of an investment account where a
comprehensive "wrap fee" is imposed. We reduce your fee by the amount of the
fee that we would normally pay to your financial professional. You pay only the
portion of the fee that the sponsor retains. This table provides an example of
the sales fee you will pay per unit if you purchase units in this type of
account.
<TABLE>
<S> <C>
Fee paid to broker 0.00%
Sponsor retention 0.90
-----
Total 0.90%
=====
</TABLE>
This discount applies during the initial offering period and in the secondary
market.
Exchange Option. You may purchase units of the trust offered in this
prospectus at a reduced sales fee of 3.00% of the unit price if
Understanding Your Investment 7
<PAGE>
you buy your units with redemption or termination proceeds from any other Ranson
unit trust. You may also purchase units of the trust offered in this prospectus
at this reduced fee if you purchase your units with termination proceeds from an
unaffiliated unit trust that has the same investment strategy as this trust.
These discounts apply only during the initial offering period.
Employees. We do not charge any sales fee for purchases made by officers,
directors and employees of Ranson and its affiliates. We also do not charge a
fee for purchases made by registered representatives of selling firms and their
family members (spouses, children and parents). This discount applies during
the initial offering period and in the secondary market.
Dividend Reinvestment Plan. We do not charge any sales fee when you reinvest
distributions from your trust into additional units of the trust. This discount
applies during the initial offering period and in the secondary market.
HOW TO SELL YOUR UNITS
You can sell your units on any business day by contacting your financial
professional or Ranson. Unit prices are available daily on the Internet at
WWW.RANSON.COM or through your financial professional. We often refer to the
sale price of units as the "bid price."
SELLING UNITS. We may maintain a secondary market for units. This means
that if you want to sell your units, we may buy them at the current price. We
may then resell the units to other investors at the public offering price or
redeem them for the redemption price. Our secondary market repurchase price is
the same as the redemption price. Certain broker-dealers might also maintain a
secondary market in units. You should contact your financial professional for
current unit prices to determine the best price available. We may discontinue
our secondary market at any time without notice. Even if we do not make a
market, you will be able to redeem your units with the trustee on any business
day for the current price.
REDEEMING UNITS. You may also redeem your units directly with the trustee,
The Bank of New York, on any day the New York Stock Exchange is open. The
trustee must receive your completed redemption request prior to the close of the
New York Stock Exchange for you to receive the unit price for a particular day.
If your request is received after that time or is incomplete in any way, you
will receive the next price computed after the trustee receives your completed
request. Rather than contacting the trustee directly, your financial
professional can also redeem your units by using the Investors' Voluntary
Redemptions and Sales (IVORS) automated redemption service offered through
Depository Trust Company.
If you redeem your units, the trustee will generally send you a payment for
your units no later than seven days after it receives all necessary
documentation (this will usually only take three business days). The only time
the trustee can delay your payment is if the New York Stock Exchange is closed
(other than weekends or holidays), the Securities and Exchange Commission
determines that trading on that exchange is restricted or an emergency exists
making sale or evaluation of the stocks not reasonably practicable, and for any
other period that the Securities and Exchange Commission permits.
8 Understanding Your Investment
<PAGE>
To redeem your units, you must send the trustee any certificates for your
units. You must properly endorse your certificates or sign a written transfer
instrument with a signature guarantee. The trustee may require additional
documents such as a certificate of corporate authority, trust documents, a death
certificate, or an appointment as executor, administrator or guardian. The
trustee cannot complete your redemption or send your payment to you until it
receives all of these documents in completed form.
You can request an in kind distribution of the stocks underlying your units,
if you own units worth at least $1,000,000 or you originally paid at least that
amount for your units. This option is generally available only for stocks
traded and held in the United States. The trustee will make any in kind
distribution of stocks by distributing applicable stocks in book entry form to
the account of your financial professional at Depositor Trust Company. You will
receive whole shares of the applicable stocks and cash equal to any fractional
shares. You may not request this option in the last 30 days of your trust's
life. We may discontinue this option at any time without notice.
EXCHANGE OPTION. You may be able to exchange your units for units of other
Ranson unit trusts at a reduced sales fee. You can contact your financial
professional or Ranson for more information about trusts currently available for
exchanges. Before you exchange units, you should read the prospectus carefully
and understand the risks and fees. You should then discuss this option with
your financial professional to determine whether your investment goals have
changed, whether current trusts suit you and to discuss tax consequences. We
may discontinue this option at any time.
DISTRIBUTIONS
QUARTERLY DIVIDENDS. Your trust generally pays dividends from its net
investment income along with any excess capital on each quarterly distribution
date to unitholders of record on the preceding record date. You can elect to:
* reinvest distributions in additional units of your trust at no fee,
* reinvest distributions in various mutual funds, or
* receive distributions in cash.
You may change your election by contacting your financial professional or the
trustee. Once you elect to participate in a reinvestment program, the trustee
will automatically reinvest your distributions into additional units or mutual
fund shares at their net asset value on the distribution date. We waive the
sales fee for reinvestments into units of your trust. We cannot guarantee that
units or mutual fund shares will always be available for reinvestment. If units
or fund shares are unavailable, you will receive cash distributions. We may
discontinue these options at any time without notice.
In some cases, your trust might pay a special distribution if it holds an
excessive amount of principal pending distribution. For example, this could
happen as a result of a merger or similar transaction involving a company whose
stock is in your portfolio. The amount of your distributions will vary from
time to time as companies change their dividends or trust expenses change.
REINVEST IN YOUR TRUST. You can keep your money working by electing to
reinvest your distributions in additional units of your trust. The easiest way
to do this is to have your financial
Understanding Your Investment 9
<PAGE>
professional purchase units with the Reinvestment CUSIP number listed in the
"Investment Summary" section of this prospectus. You may also make or change
your election by contacting your financial professional or the trustee.
REINVEST IN MUTUAL FUNDS. You can also elect to automatically reinvest your
distributions in certain mutual funds. Unlike your trust, these mutual funds
are managed funds that have different objectives. You can obtain information
about these funds from Ranson.
REPORTS. The trustee will send your financial professional a statement
showing income and other receipts of your trust for each distribution. Each
year the trustee will also provide an annual report on your trust's activity and
certain tax information. You can request copies of stock evaluations to enable
you to complete your tax forms and audited financial statements for your trust,
if available.
INVESTMENT RISKS
All investments involve risk. This section describes the main risks that can
impact the value of the stocks in your portfolio. You should understand these
risks before you invest. If the value of the stocks falls, the value of your
units will also fall. We cannot guarantee that your trust will achieve its
objective or that your investment return will be positive over any period.
MARKET RISK is the risk that the value of the stocks will fluctuate. This
could cause the value of your units to fall below your purchase price. Market
value fluctuates in response to various factors. These can include changes in
interest rates, inflation, the financial condition of the stock's issuer or even
perceptions of the issuer. Even though we carefully supervise your portfolio,
you should remember that we do not manage your portfolio. Your trust will not
sell a stock solely because the market value falls as is possible in a managed
fund.
CONCENTRATION RISK is the risk that your portfolio is less diversified
because it concentrates in a particular type of stock. When a certain type of
stock makes up more than 25% of a trust, the trust is considered to be
"concentrated" in that stock type. Your portfolio currently concentrates in
TECHNOLOGY COMPANIES. Before you invest, you should understand that:
* these companies encounter
> rapid changes in technology,
> worldwide competition,
> rapid obsolescence of products and services,
> cyclical market patterns,
> rapidly evolving industry standards, and
> frequent new product introductions.
* An unexpected change in one or more of the technologies affecting an
issuer's products or in the market for products based on a particular
technology could negatively affect an issuer's operating results.
* Operating results and customer relationships can be hurt by
10 Understanding Your Investment
<PAGE>
> an increase in price, or an interruption or reductions in supply, of any
key components, and
> the failure of an issuer to comply with rigorous industry standards.
CORRELATION RISK is the risk that the performance of the portfolio will not
sufficiently correspond with the index. This can happen for reasons such as:
* the impracticability of owning each of the index stocks with the exact
weightings at a given time.
* the possibility of index tracking errors,
* the time that elapses between a change in the index and a change in the
portfolio, and
* fees and expenses of the trust.
LITIGATION OR LEGISLATION RISK is the risk that litigation or legislation
will hurt a company's operating results or the perception of a company in the
stock market. From time to time, various legislative initiatives are proposed
in the United States and abroad that may negatively impact the companies in your
trust. In addition, litigation regarding any of the issuers of the stocks in
your trust, such as that concerning Microsoft Corporation, or of the industries
represented by these issuers may negatively impact the prices of these stocks.
No one can predict what impact any pending or threatened litigation will have on
the prices of the stocks.
THE NASDAQ-100 INDEX
The Nasdaq-100 Index includes 100 of the largest non-financial domestic and
international stocks listed on the Nasdaq Stock Market based on market
capitalization. Nasdaq represents the fastest growing stock market in the U.S.
and is one of the world's first fully electronic stock markets. This modern-day
securities market began operations in 1971 and today lists more companies than
any other market in the U.S. The Nasdaq Stock Market, Inc. has established
procedures for, and controls over, substitutions of stocks. It may make changes
in the stocks and the eligibility criteria periodically.
Eligibility criteria for the index currently includes an average daily
trading volume of at least 100,000 shares. Generally, a stock must also have
been listed on Nasdaq or a major exchange for at least two years. If a stock
would otherwise rank in the top 25% of stocks in the index by market
capitalization, then a one-year listing requirement applies. Foreign stocks
qualify only if the company has a worldwide market value of at least $10
billion, a U.S. market value of at least $4 billion and an average trading
volume of at least 200,000 shares per day. Foreign stocks must also qualify for
listed-options trading.
This table shows historical data for the index (not your trust or any
previous series). This information is not meant to indicate your future return.
Your investment return will differ from the past returns of the index. Returns
have fluctuated significantly in the past and have not always been positive.
<TABLE>
<CAPTION>
YEAR-END ANNUAL RETURN
YEAR INDEX VALUE* (NO DIVIDENDS)*
---- ------------ ---------------
<S> <C> <C>
2/1/85 125.00 -
1985 132.30 5.84%
1986 141.41 6.89
1987 156.25 10.50
1988 177.41 13.54
1989 223.84 26.17
1990 200.53 (10.41)
1991 330.86 64.99
Understanding Your Investment 11
<PAGE>
1992 360.19 8.86
1993 398.28 10.58
1994 404.27 1.50
1995 576.23 42.54
1996 821.36 42.54
1997 990.80 20.63
1998 1,836.01 85.31
1999 3,707.83 101.95
10/31/00 3,282.30 (11.48)**
<FN>
--------------------
* The table above does not reflect the sales fee or expenses you pay on your
units. It also does not reflect the effect of taxes. As with any index
portfolio, your return may differ from that of the actual index. For example,
this could happen because the trust may not be fully invested at all times, the
trust will bear brokerage commissions in buying and selling stocks, and the
weightings of stocks in the trust may not replicate their weightings in the
index at all times.
** Through 10/31/00.
</TABLE>
When reviewing any historical performance information, you should keep in
mind that past performance cannot guarantee future results. Many stocks,
especially those issued by technology companies, have exhibited above-average
price appreciation and extreme volatility in recent years during a period of a
generally rising stock market. No one can assure you that this will continue or
that the performance of stocks will replicate the performance exhibited in the
past.
HOW THE TRUST WORKS
YOUR TRUST. Your trust is a unit investment trust registered under the
Investment Company Act of 1940 and the Securities Act of 1933. We created the
trust under a trust agreement between Ranson & Associates, Inc. (as sponsor,
evaluator and supervisor) and The Bank of New York (as trustee). To create your
trust, we deposited contracts to purchase stocks with the trustee along with an
irrevocable letter of credit or other consideration to pay for the stocks. In
exchange, the trustee delivered units of your trust to us. Each unit represents
an undivided interest in the assets of your trust. These units remain
outstanding until redeemed or until your trust terminates.
CHANGING YOUR PORTFOLIO. Your trust is not a managed fund. Unlike a managed
fund, we designed your portfolio to remain relatively fixed except as is
necessary to replicate its index. Your trust will generally buy and sell
stocks:
* to reflect changes in its index,
* to establish a closer correlation with its index,
* to pay expenses or unit redemptions,
* to make required distributions or avoid imposition of taxes on the
trust, or
* as we may determine is necessary.
Your trust will generally reject any offer for securities or other property
in exchange for the stocks in its portfolio. If your trust receives securities
that are not in its index or other property, it will usually sell the securities
or property and use the proceeds to buy stocks as described above or distribute
the proceeds. For example, this could happen in a merger or similar
transaction. If the Nasdaq Stock Market discontinues the index, we may continue
operation of your trust using the index as it existed on the last date its was
available or we may terminate your trust.
We will increase the size of your trust as we sell units. When we create
additional units, we will seek to maintain a portfolio that replicates the
index. When your trust buys stocks, it will pay brokerage or other acquisition
fees. You could experience a dilution of your investment because of these fees
and fluctuations in stock
12 Understanding Your Investment
<PAGE>
prices between the time we create units and the time your trust buys the stocks.
When your trust buys or sells stocks, we may direct that it place orders with
and pay brokerage commissions to brokers that sell units or are affiliated with
your trust. We may consider whether a firm sells units of our trusts when we
select firms to handle these transactions.
AMENDING THE TRUST AGREEMENT. Ranson and the trustee can change the trust
agreement without your consent to correct any provision that may be defective or
to make other provisions that will not adversely affect your interest (as
determined by Ranson and the trustee). We cannot change this agreement to
reduce your interest in your trust without your consent. Investors owning two-
thirds of the units in your trust may vote to change this agreement.
TERMINATION OF YOUR TRUST. Your trust will terminate no later than the
termination date listed in the "Investment Summary" section of this prospectus.
The trustee may terminate your trust early if the value of the trust is less
than 20% of the original value of the stocks in the trust at the time of
deposit. At this size, the expenses of your trust may create an undue burden on
your investment. Investors owning two-thirds of the units in your trust may
also vote to terminate the trust early. We may also terminate your trust in
limited circumstances, such as if the Nasdaq Stock Market discontinues the
index.
The trustee will notify you of any termination and sell any remaining stocks.
The trustee will send your final distribution to you within a reasonable time
following liquidation of all the stocks after deducting final expenses. Your
termination distribution may be less than the price you originally paid for your
units. You may be able to request an in kind distribution of the stocks
underlying your units at termination. Please refer to the section entitled "How
to Sell Your Units-Redeeming Units" for information on in kind distributions.
RANSON. We are an investment banking firm created in 1995 by former owners
and employees of Ranson Capital Corporation. We are the successor to a series
of companies first organized in 1935. During our history we have been active in
public and corporate finance and have distributed bonds, mutual funds and unit
trusts in the primary and secondary markets. We are a registered broker-dealer
and member of the National Association of Securities Dealers, Inc. If we fail
to or cannot perform our duties as sponsor or become bankrupt, the trustee may
replace us, continue to operate your trust without a sponsor, or terminate your
trust. You can contact us at our headquarters at 250 North Rock Road, Suite
150, Wichita, Kansas 67206-2241 or by using the contacts listed on the back
cover of this prospectus.
Ranson and your trust have adopted a code of ethics requiring Ranson'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 your trust.
THE TRUSTEE. The Bank of New York is the trustee of your trust. It is a
trust company organized under New York law. You can contact the trustee by
calling the telephone number on the back cover of this prospectus or write to
Unit Investment Trust Division, 101 Barclay Street, New York, New York 10286.
We may remove and replace the trustee in some cases without your consent. The
trustee may also resign by notifying Ranson and investors.
Understanding Your Investment 13
<PAGE>
HOW WE DISTRIBUTE UNITS. We sell units to the public through broker-dealers
and other firms. We pay part of the sales fee to these distribution firms when
they sell units. The distribution fee during the initial offering period is as
follows:
<TABLE>
<CAPTION>
If a firm distributes: It will earn:
--------------------- ------------
<S> <C>
Less than $100,000 4.00%
$100,000 - $249,999 3.60
$250,000 - $499,999 3.50
$500,000 - $999,999 2.70
$1,000,000 or more 2.20
</TABLE>
We apply these amounts as a percent of the unit price per transaction at the
time of the transaction. We also apply the different distribution levels on a
unit basis using a $10 unit equivalent. For example, if a firm distributes
between 10,000 and 24,999 units, it earns 3.60% of the unit price. In addition,
firms can earn additional amounts based on total sales of all Ranson equity
index unit trusts during a single calendar month:
<TABLE>
<CAPTION>
If a firm sells this amount It will earn an
in a single month: additional:
--------------------------- ---------------
<S> <C>
$500,000 - $999,999 .10%
$1,000,000 - $1,999,999 .15
$2,000,000 - $3,999,999 .20
$4,000,000 - $5,999,999 .25
$6,000,000 - $9,999,999 .30
$10,000,000 - $14,999,999 .35
$15,000,000 - $19,999,999 .40
$20,000,000 - $49,999,999 .45
$50,000,000 or more .50
</TABLE>
We apply these amounts as a percent of the total distribution price. We pay
these additional amounts out of our own assets and not out of your sales fee
directly.
We generally register units for sale in various states in the U.S. We do not
register units for sale in any foreign country. It is your financial
professional's responsibility to make sure that units are registered or exempt
from registration if you are a foreign investor or if you want to buy units in
another country. This prospectus does not constitute an offer of units in any
state or country where units cannot be offered or sold lawfully. We may reject
any order for units in whole or in part.
We may gain or lose money when we hold units in the primary or secondary
market due to fluctuations in unit prices. The gain or loss is equal to the
difference between the price we pay for units and the price at which we sell or
redeem them. We may also gain or lose money when we to deposit securities to
create units. For example, we lost $115 on the initial deposit of stocks into
the trust.
TAXES
This section discusses some of the main U.S. federal income tax consequences
of owning units of your trust. This section is current as of the date of this
prospectus. Tax laws and interpretations change frequently, and this summary
does not describe all of the tax consequences to all taxpayers. For example,
this summary generally does 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, local or foreign taxes. As
with any investment, you should consult your own tax professional about your
particular consequences.
TRUST STATUS. Your trust intends to qualify as a "regulated investment
company" under the
14 Understanding Your Investment
<PAGE>
federal tax laws. If the trust qualifies as a regulated investment company and
distributes its income as required by the tax law, the trust generally will not
pay taxes on income.
DISTRIBUTIONS. Trust distributions are taxable to most investors. At the
end of each year, you will receive a tax statement that separates your trust's
distributions into two categories, ordinary income distributions and capital
gains dividends. Ordinary income distributions are generally taxed at your
ordinary tax rate. Generally, you will treat all capital gains dividends as
long-term capital gain regardless of how long you have owned your units. To
determine your actual tax liability for your capital gains dividends, you must
calculate your total net capital gain or loss for the tax year after considering
all of your other taxable transactions, as described below. The tax status of
your dividends from your trust is not affected by whether you reinvest your
dividends in additional units or receive them in cash. The tax laws may require
you to treat distributions made to you in January as if you had received them on
December 31 of the previous year.
IF YOU SELL OR REDEEM UNITS. If you sell or redeem your units, you will
generally recognize a taxable gain or loss. To determine the amount of this
gain or loss, you must subtract your tax basis in your units from what you
receive in the transaction. Your tax basis in your units is generally equal to
the cost of your units. In some cases, however, you may have to adjust your tax
basis after you purchase your units.
TAXATION OF CAPITAL GAIN AND LOSSES. If you are an individual, the 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.
However, if you receive a capital gain dividend and sell your unit at a loss
after holding it for six months or less, the loss will be recharacterized as
long-term capital loss to extent of the capital gain received as a dividend.
The tax rates for capital gains realized from assets held for one year or less
are generally the same as for ordinary income.
IN-KIND DISTRIBUTIONS OF STOCK. If you own enough units, you may receive an
in-kind distribution of portfolio stocks when you redeem units or when your
trust terminates. This transaction is subject to taxation and you will
recognize gain or loss, generally based on the value at that time of the stocks
and the amount of cash received.
DEDUCTIBILITY OF TRUST EXPENSES. Deductible expenses incurred by the trust
will generally not be treated as income taxable to you. In some cases, however,
you may be required to treat your portion of these trust expenses as income. In
these cases you may be able to take a deduction for these expenses. However,
certain miscellaneous itemized deductions, such as investment expenses, may be
deducted by individuals only to the extent all these deductions exceed 2% of
adjusted gross income.
FOREIGN TAX CREDIT. If your trust invests in any foreign stocks, the tax
statement that you receive may include an item showing foreign taxes your trust
paid to other countries. In this
Understanding Your Investment 15
<PAGE>
case, dividends taxed to you will include your share of the taxes your trust
paid to other countries. You may be able to deduct or receive a tax credit for
your share of these taxes.
EXPENSES
Your trust will pay various expenses to conduct its operations. The
"Investment Summary" section of this prospectus shows the estimated amount of
these expenses.
Your trust will pay a fee to the trustee for its services. The trustee also
benefits when it holds cash for your trust in non-interest bearing accounts.
Your trust will reimburse us as supervisor and evaluator for providing portfolio
supervisory services and for evaluating your portfolio. Our reimbursements may
exceed the costs of the services we provide to your trust but will not exceed
the costs of services provided to all Ranson unit investment trusts in any
calendar year. All of these fees may adjust for inflation without your
approval.
Your trust will pay a fee to the sponsor for creating and developing the
trust, including determining the trust objective, policies, composition and
size, selecting service providers and information services, and for providing
other similar administrative and ministerial functions. Your trust pays this
"creation and development fee" as a percentage of your trust's average daily net
asset value (not to exceed 2.35 percent of your initial investment over the life
of the trust). The sponsor does not use the fee to pay distribution expenses or
as compensation for sales efforts.
Your trust will also pay its general operating expenses. Your trust may pay
expenses such as trustee expenses (including legal and auditing expenses),
various governmental charges, fees for extraordinary trustee services, costs of
taking action to protect your trust, costs of indemnifying the trustee and
Ranson, legal fees and expenses, expenses incurred in contacting you and costs
incurred to reimburse the trustee for advancing funds to meet distributions.
Your trust will also pay a license fee to The Nasdaq Stock Market, Inc. for the
use of various trademarks and trade names. Your trust may pay the costs of
updating its registration statement each year. The trustee may sell stocks to
pay any trust expenses.
EXPERTS
LEGAL MATTERS. Chapman and Cutler, 111 West Monroe Street, Chicago, Illinois
60603 (http://www.chapman.com), acts as counsel for Ranson and has given an
opinion that the units are validly issued.
INDEPENDENT AUDITORS. Allen, Gibbs & Houlik, L.C., independent auditors,
audited the statement of financial condition and the portfolio included in this
prospectus.
ADDITIONAL INFORMATION
This prospectus does not contain all the information in the registration
statement that your trust filed with the Securities and Exchange Commission.
The Information Supplement, which was filed with the Securities and Exchange
Commission, includes more detailed information about the stocks in your
portfolio, investment risks and general information about your trust. You can
obtain the Information Supplement by contacting Ranson or the Securities and
Exchange Commission as indicated on the back cover of this prospectus. This
prospectus incorporates the Information Supplement by reference (it is legally
considered part of this prospectus).
16 Understanding Your Investment
<PAGE>
REPORT OF ALLEN, GIBBS & HOULIK, L.C.
INDEPENDENT AUDITORS
UNITHOLDERS
RANSON UNIT INVESTMENT TRUSTS, SERIES 99
We have audited the accompanying statement of financial condition, including the
trust portfolio, of Ranson Unit Investment Trusts, Series 99, as of the opening
of business on November 2, 2000, the initial date of deposit. The statement of
financial condition is the responsibility of the sponsor. Our responsibility is
to express an opinion on the statement of financial condition based on our
audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the statement of financial condition is free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the statement of financial condition. Our
procedures included confirmation of the purchases of securities to be deposited
in the trust by correspondence with the trustee. An audit also includes
assessing the accounting principles used and significant estimates made by the
sponsor, as well as evaluating the overall statement of financial condition
presentation. We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the statement of financial condition referred to above presents
fairly, in all material respects, the financial position of Ranson Unit
Investment Trusts, Series 99 as of November 2, 2000, in conformity with
generally accepted accounting principles.
ALLEN, GIBBS & HOULIK, L.C.
Wichita, Kansas
November 2, 2000
<TABLE>
<CAPTION>
RANSON UNIT INVESTMENT TRUSTS, SERIES 99
STATEMENT OF FINANCIAL CONDITION
AT THE OPENING OF BUSINESS ON NOVEMBER 2, 2000, THE INITIAL DATE OF DEPOSIT
<S> <C>
INVESTMENT IN STOCKS
Contracts to purchase stocks $123,984
========
Number of Units 13,037
========
LIABILITY AND INTEREST OF INVESTORS
Liability
Organization costs $ 652
--------
Interest of investors
Cost to investors 130,370
Less: gross underwriting commission and organization costs 7,038
--------
Net interest of investors 123,332
--------
Total $123,984
========
<FN>
--------------------
(1) Aggregate cost of the securities is based on the closing sale price
evaluations as determined by the trustee.
(2) Cash or an irrevocable letter of credit issued by Intrust Bank, N.A.,
Wichita, Kansas has been deposited with the trustee covering the funds
(aggregating $124,099) necessary for the purchase of the securities in the
trust represented by purchase contracts.
(3) A portion of the public offering price represents an amount sufficient to pay
for all or a portion of the costs incurred in establishing and offering the
trust. The amount of these costs is set forth in the "Fees and Expenses." A
distribution will be made as of the close of the initial offering period to
an account maintained by the trustee from which this obligation of the
investors will be satisfied.
(4) The aggregate cost to investors includes the applicable sales fee assuming no
reduction of sales fees for quantity purchases.
</TABLE>
Understanding Your Investment 17
<PAGE>
CONTENTS
Investment Summary
------------------------------------------------------------------
A concise description 2 Investment Objective
of essential information 2 Investment Strategy
about the portfolio 2 Principal Risks
3 Who Should Invest
3 Essential Information
3 Fees and Expenses
4 The Portfolio
Understanding Your Investment
------------------------------------------------------------------
Detailed information to 6 How to Buy Units
help you understand 8 How to Sell Your Units
your investment 9 Distributions
10 Investment Risks
11 The Nasdaq-100 Index
12 How the Trust Works
14 Taxes
16 Expenses
16 Experts
16 Additional Information
17 Report of Independent Auditors
17 Statement of Financial Condition
Where to Learn More
------------------------------------------------------------------
You can contact us for VISIT US ON THE INTERNET
free information about http://www.ranson.com
this and other invest- BY E-MAIL
ments, including the [email protected]
Information Supplement. CALL RANSON
(800) 345-7999
Pricing Line (888) 248-4954
CALL BANK OF NEW YORK
(800) 701-8178 (investors)
(800) 647-3383 (brokers)
Additional Information
------------------------------------------------------------------
This prospectus does not contain all information filed with the
Securities and Exchange Commission. To obtain or copy this
information, including the Information Supplement (a duplication
fee may be required):
E-MAIL: [email protected]
WRITE: Public Reference Section
Washington, D.C. 20549-0102
VISIT: http://www.sec.gov (EDGAR Database)
CALL: 1-202-942-8090 (only for information on
the operation of the Public Reference Section)
REFER TO:
RANSON UNIT INVESTMENT TRUSTS, SERIES 99
Securities Act file number: 333-48804
Investment Company Act file number: 811-3763
<PAGE>
RANSON
UNIT
INVESTMENT
TRUSTS
[LOGO]
NASDAQ-100
INDEX TRUST
SERIES 10
PROSPECTUS NOVEMBER 2, 2000
<PAGE>
RANSON UNIT INVESTMENT TRUSTS, SERIES 99
NASDAQ-100 INDEX TRUST, SERIES 10
INFORMATION SUPPLEMENT
This Information Supplement provides additional information concerning each
trust described in the prospectus for the Ranson Unit Investment Trusts series
identified above. This Information Supplement should be read in conjunction
with the prospectus. It is not a prospectus. It does not include all of the
information that an investor should consider before investing in a trust. It may
not be used to offer or sell units of a trust without the prospectus. This
Information Supplement is incorporated into the prospectus by reference and has
been filed as part of the registration statement with the Securities and
Exchange Commission. Investors should obtain and read the prospectus prior to
purchasing units of a trust. You can obtain the prospectus without charge by
contacting your financial professional or by contacting Ranson & Associates,
Inc. at 250 North Rock Road, Suite 150, Wichita, Kansas 67206-2241, or at (800)
345-7999. This Information Supplement is dated as of the date of the
prospectus.
<TABLE>
<CAPTION>
CONTENTS
<S> <C>
General Information 2
Nasdaq-100(Registered Trademark) Index Licensing Agreement 3
The Nasdaq-100 Index 4
Investment Objective and Policies 7
Risk Factors 8
Administration of the Trust 11
Portfolio Transactions and Brokerage Allocation 17
Purchase, Redemption and Pricing of Units 18
Taxation 21
Performance Information 24
</TABLE>
<PAGE>
GENERAL INFORMATION
Each trust is one of a series of separate unit investment trusts created
under the name Ranson Unit Investment Trusts and registered under the Investment
Company Act of 1940 and the Securities Act of 1933. Each trust was created as a
common law trust on the inception date described in the prospectus under the
laws of the state of New York. Each trust was created under a trust agreement
among Ranson & Associates, Inc. (as sponsor, evaluator and supervisor) and The
Bank of New York (as trustee).
When your trust was created, the sponsor delivered to the trustee securities
or contracts for the purchase thereof for deposit in the trust and the trustee
delivered to the sponsor documentation evidencing the ownership of units of the
trust. The sponsor will seek to create an initial portfolio that substantially
replicates the index, however, this initial deposit into the trust may consist
of an equal number of shares of each of the stocks which comprise the trust's
target index. In either case, during the first 30 days of a trust's life, the
sponsor intends to create and maintain a portfolio that duplicates, to the
extent practicable, the weightings of stocks that comprise the target index.
The sponsor anticipates that within the initial 30-day adjustment period, a
trust portfolio will comprise the stocks in its target index in substantially
the same weightings as in such index. Of course, there is no guarantee that
this will occur during the first 30 days of a trust's life. In connection with
any deposit of securities, purchase and sale transactions will be effected in
accordance with computer program output showing which securities are under- or
over-represented in a trust portfolio. Precise duplication of the relationship
among the securities in an index may not be achieved because it may be
economically impracticable or impossible to acquire very small numbers of shares
of certain stocks and because of other procedural policies of a trust, but
correlation between the performance of an index and the related trust portfolio
is expected to be between .97 and .99 over the term of the trust.
By investing in substantially all of the stocks, in substantially the same
proportions, which comprise an index, a trust seeks to produce investment
results that generally correspond to the price and yield performance of the
securities represented by such index over the term of the trust. Due to various
factors discussed below, there can be no assurance that this objective will be
met. An investment in units should be made with an understanding that each
trust includes payments of sales fees and expenses which may not be considered
in public statements of the total return of the target index.
After a trust is created, the sponsor may deposit additional securities in
the trust, contracts to purchase additional securities along with cash (or a
bank letter of credit in lieu of cash) to pay for such contracted securities or
cash (including a letter of credit) with instructions to purchase additional
securities, maintaining, as closely as practicable the same proportionate
relationship among the securities in the portfolio as reflected in the target
index. Thus, although additional units will be issued, each unit of a trust
will continue to represent approximately a weighting of the then current
components of the target index at any such deposit. Precise duplication of the
relationship among the securities in a trust may not be achieved because it may
be economically impracticable as a result of certain economic factors and
procedural policies of the trust such as (1) price movements of the various
securities will not duplicate one another, (2) the sponsor may purchase shares
of the securities in round lot quantities, (3) reinvestment of excess proceeds
not needed to meet redemptions of units may not be sufficient to acquire equal
round lots of all the securities in the trust and (4) reinvestment of proceeds
received from securities which are no longer components of the target index
might not result in the purchase of an equal number of shares in any replacement
security. If the sponsor deposits cash, existing and new investors may
experience a dilution of their investments and a reduction in their anticipated
income because of fluctuations in the prices of the securities between the time
of the cash deposit and the purchase of the securities and because a trust will
pay the associated brokerage fees. To minimize this effect, a trust will
attempt to purchase the securities as close to the evaluation time or as close
to the evaluation prices as possible.
A trust consists of (a) the securities listed under "The Portfolio" in the
prospectus as may continue to be held from time to time in the trust, (b) any
additional securities acquired and held by the trust pursuant to the provisions
2
<PAGE>
of the trust agreement and (c) any cash held in the accounts of the trust.
Neither the sponsor nor the trustee shall be liable in any way for any failure
in any of the securities. However, should any contract for the purchase of any
of the securities initially deposited in a trust fail, the sponsor will, unless
substantially all of the moneys held in the trust to cover such purchase are
reinvested in substitute securities in accordance with the trust agreement,
refund the cash and sales charge attributable to such failed contract to all
unitholders on the next distribution date.
NASDAQ-100(REGISTERED TRADEMARK) INDEX LICENSING AGREEMENT
The sponsor has entered into a license agreement with The Nasdaq Stock
Market, Inc., under which any Nasdaq-100 Trust (through the sponsor) is granted
licenses to use the trademark and tradenames "Nasdaq," "Nasdaq-100," and
"Nasdaq-100 Index" solely in materials relating to the creation and issuance,
marketing and promotion of any such trust and in accordance with any
applicable federal and state securities law to indicate the source of the
Nasdaq-100 Index as a basis for determining the composition of such trust's
portfolio. As consideration for the grant of the license, each Nasdaq-100
Trust will pay to The Nasdaq Stock Market, Inc. an annual fee. If the
Nasdaq-100 Index ceases to be compiled or made available or the anticipated
correlation between a trust and the Nasdaq-100 Index is not maintained, the
sponsor may direct that the trust continue to be operated using the
Nasdaq-100 Index as it existed on the last date on which it was available
or may direct that the trust agreement be terminated.
Neither the trust nor the unitholders are entitled to any rights whatsoever
under the foregoing licensing arrangements or to use any of the covered
trademarks or to use the Nasdaq-100 Index, except as specifically described
herein or as may be specified in the trust agreement.
No trust is sponsored, endorsed, sold or promoted by The Nasdaq Stock Market,
Inc. (including its affiliates) (the "Corporations"). The Corporations have not
passed on the legality or suitability of, or the accuracy or adequacy of
descriptions and disclosures relating to, any trust or units of any trust. The
Corporations make no representation or warranty, express or implied, to the
owners of units of a trust or any member of the public regarding the
advisability of investing in securities generally or in units of a trust
particularly or the ability of the Nasdaq-100 Index to track general stock
market performance. The Corporations' only relationship to the sponsor
("Licensee") and a trust is in the licensing of certain trademarks, service
marks, and trade names of the Corporations and the use of the Nasdaq-100 Index
which is determined, composed and calculated by Nasdaq without regard to the
Licensee, a trust or unitholders of a trust. Nasdaq has no obligation to take
the needs of the Licensee or the unitholders into consideration in determining,
composing or calculating the Nasdaq-100 Index. The Corporations are not
responsible for and have not participated in the determination of the timing of,
prices at, or quantities of the units of a trust to be issued or in the
determination or calculation of the equation by which the units of a trust are
to be converted into cash. The Corporations have no liability in connection
with the administration or operations of a trust, marketing or trading of units
of a trust.
THE CORPORATIONS DO NOT GUARANTEE THE ACCURACY AND/OR UNINTERRUPTED
CALCULATION OF THE NASDAQ-100 INDEX OR ANY DATA INCLUDED THEREIN. THE
CORPORATIONS MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED
BY LICENSEE, OWNERS OF UNITS OF A NASDAQ-100 TRUST, OR ANY OTHER PERSON OR
ENTITY FROM THE USE OF THE NASDAQ-100 INDEX OR ANY DATA INCLUDED THEREIN. THE
CORPORATIONS MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIM ALL
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH
RESPECT TO THE NASDAQ-100 INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING
ANY OF THE FOREGOING, IN NO EVENT SHALL THE CORPORATIONS HAVE ANY LIABILITY FOR
ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES (INCLUDING LOST
PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.
3
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THE NASDAQ-100 INDEX
The Nasdaq-100 Index is composed of 100 of the largest and most-active non-
financial domestic and international stocks listed on The Nasdaq Stock Market
based on market capitalization. Nasdaq is one of the first fully electronic
stock markets in the world. This modern-day securities market began operations
in 1971 and today lists more companies than any other market in the U.S.
The table below illustrates the characteristics of the average company
included in the Nasdaq-100 Index as of October 31, 2000. It is important to
note that, unless provided otherwise, the data included in the table encompasses
average data, not the total data of all companies in the Nasdaq-100 Index and is
not intended to describe or predict the financial data, returns or
characteristics of any company included or to be included in the Nasdaq-100
Index. All figures are in millions except Share Price, P/E Ratio for Total Index
and World Market Cap.
<TABLE>
<CAPTION>
FINANCIAL CHARACTERISTICS
<S> <C>
Share Price $ 54.741
Total Assets $ 5,897.30
Shareholders' Equity $ 3,508.30
Total Revenues $ 3,516.70
Net Income $ 386.52
Shares Outstanding 657.24
World Market Cap $2.88 Trillion
P/E Ratio for Total Index(a,b) 123.24
<FN>
(a) Total market value divided by total earnings.
(b) These figures represent total data for all index companies.
</TABLE>
The prospectus includes a table providing information about the year-end
index value for the Nasdaq-100 Index for a certain period. The formula used in
calculating the Nasdaq-100 Index Level is described below. The table uses data
that is adjusted to reflect that the Nasdaq-100 Index level was halved on
January 3, 1994, and does not reflect reinvestment of dividends. Investors
should note that the figures in the prospectus represent past performance of the
Nasdaq-100 Index and not the future performance of the Nasdaq-100 Index or a
Nasdaq-100 Trust (which includes certain fees and expenses). Past performance
is, of course, no guarantee of future results.
Because a trust is sold to the public at net asset value plus the applicable
sales fee, and the expenses of a trust are deducted before making distributions
to unitholders, investment in a trust would have resulted in investment
performance to unitholders somewhat reduced from that reflected in the table in
the prospectus.
The numeric value level of the Nasdaq-100 Index was originally established at
250 prior to the opening of the market on February 1, 1985. The Nasdaq-100
Index value was halved at the end of 1993. The level of the Nasdaq-100 Index
will only change as a result of the price changes occurring between the opening
and closing of the market.
The information in this section has been taken from publicly available
sources provided by The Nasdaq Stock Market, Inc. or the National Association of
Securities Dealers, Inc. The sponsor believes this information to be accurate
as of the date of this Information Supplement but has not independently reviewed
the accuracy of this information. The manner in which the index level is
calculated, index eligibility criteria, the annual ranking review and the
process for rebalancing the index may change in the future. These factors are
solely within the control of The Nasdaq Stock Market, Inc. or the National
Association of Securities Dealers, Inc. and may change without consideration of
or notice to the trust or the sponsor.
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INDEX SECURITY ELIGIBILITY CRITERIA AND ANNUAL RANKING REVIEW. To be
eligible for inclusion in the index, a security must be traded on the Nasdaq
National Market tier of the Nasdaq Stock Market and meet the following criteria:
* the security must be of a non-financial company;
* only one class of security per issuer is allowed;
* the security may not be issued by an issuer currently in bankruptcy
proceedings;
* the security must have average daily trading volume of at least 100,000
shares per day;
* the security must have "seasoned" on the Nasdaq Stock Market or another
recognized market (generally, a company is considered to be seasoned by Nasdaq
if it has been listed on a market for at least two years; in the case of spin-
offs, the operating history of the spin-off will be considered);
* if a security would otherwise qualify to be in the top 25% of the issuers
included in the index by market capitalization, then a one year "seasoning"
criteria would apply;
* if the security is of a foreign issuer, the company must have a worldwide
market value of at least $10 billion, a U.S. market value of at least $4
billion, and average trading volume on the Nasdaq Stock Market of at least
200,000 shares per day; in addition, foreign securities must be eligible for
listed options trading; and
* the issuer of the security may not have entered into a definitive agreement
or other arrangement which would result in the security no longer being listed
on the Nasdaq Stock Market within the next six months.
These index eligibility criteria may be revised from time to time by the
National Association of Securities Dealers, Inc. without regard to a trust. The
index securities are evaluated annually as follows (such evaluation is referred
to herein as the "Annual Ranking Review"). Securities listed on the Nasdaq Stock
Market which meet the above eligibility criteria are ranked by market value.
index-eligible securities which are already in the index and which are in the
top 150 eligible securities (based on market value) are retained in the index
provided that such security was ranked in the top 100 eligible securities as of
the previous year's annual review. Securities not meeting such criteria are
replaced. The replacement securities chosen are those index-eligible securities
not currently in the index which have the largest market capitalization. The
list of annual additions and deletions is publicly announced via a press release
in the early part of December. Replacements are made effective after the close
of trading on the third Friday in December. Moreover, if at any time during the
year an index security is no longer traded on the Nasdaq Stock Market, or is
otherwise determined by Nasdaq to become ineligible for continued inclusion in
the index, the security will be replaced with the largest market capitalization
security not currently in the index and meeting the index eligibility criteria
listed above.
In addition to the Annual Ranking Review, the securities in the index are
monitored every day by Nasdaq with respect to changes in total shares
outstanding arising from secondary offerings, stock repurchases, conversions, or
other corporate actions. Nasdaq has adopted the following quarterly scheduled
weight adjustment procedures with respect to such changes. If the change in
total shares outstanding arising from such corporate action is greater than or
equal to 5.0%, such change is ordinarily made to the index on the evening prior
to the effective date of such corporate action. Otherwise, if the change in
total shares outstanding is less than 5%, then all such changes are accumulated
and made effective at one time on a quarterly basis after the close of trading
on the third Friday in each of March, June, September, and December. In either
case, the index share weights for such index securities are adjusted by the same
percentage amount by which the total shares outstanding have changed in such
index securities. Ordinarily, whenever there is a change in index share weights
or a change in a component security included in the index, Nasdaq adjusts the
divisor to assure that there is no discontinuity in the value of the index which
might otherwise be caused by any such change.
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<PAGE>
REBALANCING OF THE INDEX. Effective after the close of trading on December
18, 1998, the index has been calculated under a "modified capitalization-
weighted" methodology, which is a hybrid between equal weighting and
conventional capitalization weighting. This methodology is expected to: (1)
retain in general the economic attributes of capitalization weighting; (2)
promote portfolio weight diversification; (3) reduce index performance
distortion by preserving the capitalization ranking of companies; and (4) reduce
market impact on the smallest index securities from necessary weight
rebalancings.
Under the methodology employed, on a quarterly basis coinciding with Nasdaq's
quarterly scheduled weight adjustment procedures, the index securities are
categorized as either "Large Stocks" or "Small Stocks" depending on whether
their current percentage weights (after taking into account such scheduled
weight adjustments due to stock repurchases, secondary offerings, or other
corporate actions) are greater than, or less than or equal to, the average
percentage weight in the index (i.e., as a 100-stock index, the average
percentage weight in the index is 1.0%).
Such quarterly examination will result in an index rebalancing if either one
or both of the following two weight distribution requirements are not met: (1)
the current weight of the single largest market capitalization index security
must be less than or equal to 24.0% and (2) the "collective weight" of those
index securities whose individual current weights are in excess of 4.5%, when
added together, must be less than or equal to 48.0%. If either one or both of
these weight distribution requirements are not met upon quarterly review, a
weight rebalancing will be performed in accordance with the following plan.
First, relating to weight distribution requirement (1) above, if the current
weight of the single largest index security exceeds 24.0%, then the weights of
all Large Stocks will be scaled down proportionately towards 1.0% by enough for
the adjusted weight of the single largest index security to be set to 20.0%.
Second, relating to weight distribution requirement (2) above, for those index
securities whose individual current weights or adjusted weights in accordance
with the preceding step are in excess of 4.5%, if their "collective weight"
exceeds 48.0%, then the weights of all Large Stocks will be scaled down
proportionately towards 1.0% by just enough for the "collective weight," so
adjusted, to be set to 40.0%.
The aggregate weight reduction among the Large Stocks resulting from either
or both of the above rescalings will then be redistributed to the Small Stocks
in the following iterative manner. In the first iteration, the weight of the
largest Small Stock will be scaled upwards by a factor which sets it equal to
the average index weight of 1.0%. The weights of each of the smaller remaining
Small Stocks will be scaled up by the same factor reduced in relation to each
stock's relative ranking among the Small Stocks such that the smaller the index
security in the ranking, the less the scale-up of its weight. This is intended
to reduce the market impact of the weight rebalancing on the smallest component
securities in the index.
In the second iteration, the weight of the second largest Small Stock,
already adjusted in the first iteration, will be scaled upwards by a factor
which sets it equal to the average index weight of 1.0%. The weights of each of
the smaller remaining Small Stocks will be scaled up by this same factor reduced
in relation to each stock's relative ranking among the Small Stocks such that,
once again, the smaller the stock in the ranking, the less the scale-up of its
weight.
Additional iterations will be performed until the accumulated increase in
weight among the Small Stocks exactly equals the aggregate weight reduction
among the Large Stocks from rebalancing in accordance with weight distribution
requirement (1) and/or weight distribution requirement (2). Then, to complete
the rebalancing procedure, once the final percent weights of each index security
are set, the index share weights will be determined anew based upon the last
sale prices and aggregate capitalization of the index at the close of trading on
the Thursday in the week immediately preceding the week of the third Friday in
March, June, September, and December. Changes to the index share weights will be
made effective after the close of trading on the third Friday in March, June,
September, and December and an adjustment to the index divisor will be made to
ensure continuity of the index.
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<PAGE>
INVESTMENT OBJECTIVE AND POLICIES
A trust portfolio will consist of as many of the stocks in the trust's target
index as is feasible in order to achieve the trust's objective of attempting to
provide investment results that duplicate substantially the total return of such
index. Following the initial 30-day adjustment period described above, a trust
seeks to invest in no less than 95% of the stocks comprising its target index.
Although it may be impracticable for a trust to own certain of such stocks at
any time, the sponsor expects to maintain a correlation between the performance
of a trust portfolio and that of its target index of between .97 and .99 over
the term of the trust.
Adjustments to a trust portfolio will be made on an ongoing basis in
accordance with the computer program output to match the weightings of the
securities as closely as is feasible with their weightings in the trust's target
index as the trust invests in new securities in connection with the creation of
additional units, as companies are dropped from or added to such index or as
securities are sold to meet redemptions. The trustee will generally seek to
make these adjustments on the business day following the relevant transaction in
accordance with computer program output showing which of the securities are
under- or over- represented in a trust portfolio. Of course, there is no
guarantee that this will always be practicable. Adjustments may also be made
from time to time to maintain the appropriate correlation between a trust and
its target index. The proceeds from any sale will generally be invested in
those securities that are most under-represented in the portfolio.
Due to changes in the composition of an index, adjustments to a trust
portfolio may be made from time to time. It is anticipated that most of such
changes in an index will occur as a result of merger or acquisition activity.
In such cases, a trust, as a shareholder of an issuer which is the object of
such merger or acquisition activity, will presumably receive various offers from
potential acquirers of the issuer. The trustee is not permitted to accept any
such offers until such time as the issuer has been removed from the trust's
target index. Since, in most cases, an issuer is removed from an index only
after the consummation of a merger or acquisition, it is anticipated that a
trust will generally acquire, in exchange for the stock of the deleted issuer,
the consideration that is being offered to shareholders of that issuer who have
not tendered their shares prior to that time. Any cash received as
consideration in such transactions will be reinvested in the most under-
represented securities. Any securities received as consideration which are not
included in the trust's target index will be sold as soon as practicable and
will also be reinvested in the most under-represented securities.
In attempting to duplicate the proportionate relationships represented by an
index, the sponsor may purchase or sell stock in round lots (100 shares). In
addition, certain securities may not be available in the quantities specified by
the computer program. For these reasons, among others, precise duplication of
the proportionate relationships in an index may not be possible but will
continue to be the goal in connection with acquisitions or dispositions of
securities. As the holder of the securities, the trustee will have the right to
vote all of the voting stocks in a trust portfolio and will vote such stocks in
accordance with the instructions of the sponsor.
Each trust is a unit investment trust and is not an "actively managed" fund.
Traditional methods of investment management for a managed fund typically
involve frequent changes in a portfolio of securities on the basis of economic,
financial and market analysis. The portfolio of a trust, however, will not be
actively managed and therefore the adverse financial condition of an issuer will
not necessarily require the sale of its securities from a portfolio.
As a general rule, the only purchases and sales that will be made with
respect to a trust's portfolio will be those necessary to maintain, to the
extent feasible, a portfolio which reflects the current components of the
trust's target index, taking into consideration redemptions, sales of additional
units and the other adjustments referred to elsewhere in this Information
Supplement and the prospectus. Such purchases and sales will be made in
accordance with the computer program utilized to maintain the portfolio, the
trust agreement and procedures to be specified by the sponsor. The sponsor may
direct the trustee to dispose of securities and either to acquire other
securities through the use of the proceeds of such disposition in order to make
changes in a portfolio or to distribute the proceeds of such
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<PAGE>
disposition to unitholders (i) as necessary to reflect any additions to or
deletions from the trust's target index, (ii) as may be necessary to establish a
closer correlation between the trust portfolio and the target index or (iii) as
may be required for purposes of distributing to unitholders, when required,
their pro rata share of any net realized capital gains or (iv) as the sponsor
may otherwise determine. The sponsor may direct the trustee to acquire round
lots of shares of the securities rather than odd lot amounts. Any funds not
used to acquire round lots will be held for future purchases of shares, for
redemptions of units or for distributions to unitholders. In the event the
trustee receives any securities or other properties relating to the securities
(other than normal dividends) acquired in exchange for securities such as those
acquired in connection with a reorganization, recapitalization, merger or other
transaction, the trustee is directed to sell such securities or other property
and reinvest the proceeds in shares of the security for which such securities or
other property relates, or if such security is thereafter removed from the
trust's target index, in any new security which is added as a component of such
index.
In addition, the trustee may dispose of certain securities and take such
further action as may be needed from time to time to ensure that a trust
continues to satisfy the qualifications of a regulated investment company,
including the requirements with respect to diversification under Section 851 of
the Internal Revenue Code, and as may be needed from time to time to avoid the
imposition of any excise tax on a trust as a regulated investment company.
Proceeds from the sale of securities (or any securities or other property
received by a trust in exchange for securities) are credited to the Capital
Account of a trust for distribution to unitholders or to meet redemptions.
Except for failed securities and as provided herein, in the prospectus or in the
trust agreement, the acquisition by a trust of any securities other than the
portfolio securities is prohibited. The trustee may sell securities from a
trust for the purpose of redeeming units tendered for redemption and the payment
of expenses.
RISK FACTORS
STOCKS. An investment in units of a trust should be made with an
understanding of the risks inherent in an investment in equity securities,
including the risk that the financial condition of issuers of the securities may
become impaired or that the general condition of the stock market may worsen
(both of which may contribute directly to a decrease in the value of the
Securities and thus, in the value of the units) or the risk that holders of
common stock have a right to receive payments from the issuers of those stocks
that is generally inferior to that of creditors of, or holders of debt
obligations issued by, the issuers and that the rights of holders of common
stock generally rank inferior to the rights of holders of preferred stock.
Common stocks are especially susceptible to general stock market movements and
to volatile increases and decreases in value as market confidence in and
perceptions of the issuers change. These perceptions are based on unpredictable
factors including expectations regarding government, economic, monetary and
fiscal policies, inflation and interest rates, economic expansion or
contraction, and global or regional political, economic or banking crises.
Holders of common stock incur more risk than the holders of preferred stocks
and debt obligations because common stockholders, as owners of the entity, have
generally inferior rights to receive payments from the issuer in comparison with
the rights of creditors of, or holders of debt obligations or preferred stock
issued by the issuer. Holders of common stock of the type held by a trust have
a right to receive dividends only when and if, and in the amounts, declared by
the issuer's board of directors and to participate in amounts available for
distribution by the issuer only after all other claims on the issuer have been
paid or provided for. By contrast, holders of preferred stock have the right to
receive dividends at a fixed rate when and as declared by the issuer's board of
directors, normally on a cumulative basis, but do not participate in other
amounts available for distribution by the issuing corporation. Cumulative
preferred stock dividends must be paid before common stock dividends and any
cumulative preferred stock dividend omitted is added to future dividends payable
to the holders of cumulative preferred stock. Preferred stocks are also
entitled to rights on liquidation which are senior to those of common stocks.
Moreover, common stocks do not represent an obligation of the issuer and
therefore do not offer any assurance of income or provide the degree of
protection of capital debt securities. Indeed, the issuance of debt securities
or even preferred stock will create prior claims for payment of principal,
interest, liquidation preferences and dividends which could adversely
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<PAGE>
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. Further, unlike debt securities
which typically have a stated principal amount payable at maturity (whose value,
however, will be subject to market fluctuations prior thereto), common stocks
have neither a fixed principal amount nor a maturity and have values which are
subject to market fluctuations for as long as the stocks remain outstanding. The
value of the securities in a portfolio thus may be expected to fluctuate over
the entire life of a trust to values higher or lower than those prevailing at
the time of purchase.
TECHNOLOGY ISSUERS. Because the Nasdaq-100 Index generally includes a
concentration of technology and technology-related companies, an investment in
units of a Nasdaq-100 Trust should be made with an understanding of the
characteristics of the technology industry and the risks which such an
investment may entail. Technology companies generally include companies
involved in the development, design, manufacture and sale of computers, computer
related equipment, computer networks, communications systems, telecommunications
products, semiconductors, electronic products, and other related products,
systems and services. The market for technology products is characterized by
rapidly changing technology, rapid product obsolescence, cyclical market
patterns, evolving industry standards and frequent new product introductions.
The success of the issuers of the securities depends in substantial part on the
timely and successful introduction of new products. An unexpected change in one
or more of the technologies affecting an issuer's products or in the market for
products based on a particular technology could have a material adverse affect
on an issuer's operating results. Furthermore, there can be no assurance that
the issuers of the securities will be able to respond timely to compete in the
rapidly developing marketplace.
Based on trading history of common stock, factors such as announcements of
new products or development of new technologies and general conditions of the
industry have caused and are likely to cause the market price of technology
common stocks to fluctuate substantially. In addition, technology company
stocks have experienced extreme price and volume fluctuations that often have
been unrelated to the operating performance of such companies. This market
volatility may adversely affect the market price of the securities and therefore
the ability of a unitholder to redeem units at a price equal to or greater than
the original price paid for such units.
Some key components of certain products of technology issuers are currently
available only from single sources. There can be no assurance that in the
future suppliers will be able to meet the demand for components in a timely and
cost effective manner. Accordingly, an issuer's operating results and customer
relationships could be adversely affected by either an increase in price for, or
an interruption or reduction in supply of, any key components. Additionally,
many technology issuers are characterized by a highly concentrated customer base
consisting of a limited number of large customers who may require product
vendors to comply with rigorous industry standards. Any failure to comply with
such standards may result in a significant loss or reduction of sales. Because
many products and technologies of technology companies are incorporated into
other related products, such companies are often highly dependent on the
performance of the personal computer, electronics and telecommunications
industries. There can be no assurance that these customers will place
additional orders, or that an issuer of securities will obtain orders of similar
magnitude as past orders from other customers. Similarly, the success of
certain technology companies is tied to a relatively small concentration of
products or technologies. Accordingly, a decline in demand of such products,
technologies or from such customers could have a material adverse impact on
issuers of the securities.
Many technology companies rely on a combination of patents, copyrights,
trademarks and trade secret laws to establish and protect their proprietary
rights in their products and technologies. There can be no assurance that the
steps taken by the issuers of the securities to protect their proprietary rights
will be adequate to prevent misappropriation of their technology or that
competitors will not independently develop technologies that are substantially
equivalent or superior to such issuers' technology.
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Certain issuers of the securities may derive a significant amount of business
in foreign markets. Many countries, especially emerging market countries, have
regulatory requirements that differ from U.S. requirements and are characterized
by less developed and more volatile economies. International sales and
operations are subject to certain risks, including unexpected changes in
regulatory environments, exchange rates, tariffs and other barriers, political
and economic instability and potentially adverse tax consequences. All of these
factors could have a material adverse impact on the financial condition of
certain issuers.
LITIGATION. Microsoft Corporation is currently engaged in litigation with
Sun Microsystems, Inc., the U.S. Department of Justice and several state
Attorneys General. The complaints against Microsoft include copyright
infringement, unfair competition and anti-trust violations. The claims seek
injunctive relief and monetary damages. The District Court handling the
antitrust case recently held that Microsoft exercised monopoly power in
violation of the Sherman Antitrust Act and various state antitrust laws. The
court entered into a final judgment on June 7, 2000 in which it called for
Microsoft to be broken up into two separate companies, one composed of the
company's operating systems and the other containing its applications software
business. The court also called for significant operating restrictions to be
placed on the company until such time as the separation was completed.
Microsoft has stated that it will appeal the rulings against it after the
penalty phase and final decree. It is impossible to predict what impact the
penalties will have on Microsoft or the value of its stock. No one can predict
the outcome of the litigation pending against this company or how the current
uncertainty concerning regulatory and legislative measures will ultimately be
resolved. No one can predict the impact that these and other possible
developments will have on the price of this stock or any trust.
INDEX REPLICATION. An investment in a trust should also be made with an
understanding that the trust will not be able to replicate exactly the
performance of its target index because the total return generated by the
securities will be reduced by transaction costs incurred in adjusting the actual
balance of the securities and other trust expenses, whereas such transaction
costs and expenses are not included in the calculation of an index. It is also
possible that for short periods of time, a trust may not fully replicate the
performance of its target index due to the temporary unavailability of certain
index securities in the secondary market or due to other extraordinary
circumstances. Such events are unlikely to continue for an extended period of
time because the trustee is required to correct such imbalances by means of
adjusting the composition of the securities. It is also possible that the
composition of a trust may not exactly replicate the composition of its target
index if the trust has to adjust its portfolio holdings in order to continue to
qualify as a "regulated investment company" under the federal tax laws.
VOLATILITY AND CONCENTRATIONS IN NASDAQ-100 INDEX. A Nasdaq-100 Trust is
subject to the risk of an investment in a broad market portfolio of equity
securities, including the risk that the general level of stock prices may
decline, thereby adversely affecting the value of such investment. A Nasdaq-100
trust is also subject to the risk of an investment in a portfolio of equity
securities in economic sectors in which the index may be highly concentrated
(e.g., technology) as well as to the risks specific to the performance of a few
individual component securities which currently represent a highly concentrated
weighting in the index (e.g., Microsoft Corporation, Intel Corporation and Cisco
Systems Inc.). These include the risks that the level of stock prices in these
sectors or the stock prices of these specific companies may decline, thereby
adversely affecting the value of a Nasdaq-100 Trust. In addition, because it is
the policy of a Nasdaq-100 Trust to invest in the securities that comprise the
index, if the index is concentrated in an industry or group of industries, the
portfolio also will be concentrated in that industry or group of industries.
Furthermore, investors should be aware that in the event that one or more stocks
which currently have a highly concentrated weighting in the index were to leave
the Nasdaq Stock Market, if a company with a large market capitalization were to
list its shares on the Nasdaq Stock Market, or if there were a significant
rebalancing of the index, then the composition and weighting of the Index, and
hence the composition and weighting of the stocks in a Nasdaq-100 Trust, would
change significantly and the performance of a Nasdaq-100 Trust would reflect the
performance of the new index as reconfigured.
Furthermore, due to the concentration of the index in sectors characterized
by relatively higher volatility in price performance when compared to other
economic sectors, the performance of the index may be more volatile when
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compared to other broad based stock indices. For this reason, it is anticipated
that the price volatility of a Nasdaq-100 Trust may be greater than the price
volatility of other market-traded securities which are issued by investment
companies based upon indices other than the index.
CHANGES IN LISTINGS. From time to time stocks change the primary market in
which they are traded. For example, a stock that is currently traded on the
Nasdaq Stock Market may become listed on the New York Stock Exchange and no
longer traded on Nasdaq. If this happens to a stock in a Nasdaq-100 Trust, the
Nasdaq Stock Market will presumably remove the stock from the Nasdaq-100 Index.
This would cause a Nasdaq-100 Trust to remove the stock from its portfolio.
This could have a negative impact on a trust and could cause significant tax
consequences if the stock comprises a large portion of the index and its price
has changed significantly since acquisition. The significance of a listing
change could be especially important if it involved a company such as Microsoft
Corporation, Intel Corporation or Cisco Systems Inc. and other stocks that
comprise large percentages of the Nasdaq-100 Index. New stocks may also begin
trading on the Nasdaq Stock Market in the future. This could result from
delistings from stock exchanges, such as the New York Stock Exchange, or as a
result of initial public offerings and other new listings of stocks previously
traded over-the-counter. These changes could also impact a trust as described
above.
LIQUIDITY. Whether or not the securities are listed on a national securities
exchange, the principal trading market for the securities may be in the
over-the-counter market. As a result, the existence of a liquid trading
market for the securities may depend on whether dealers will make a market
in the securities. There can be no assurance that a market will be made for
any of the securities, that any market for the securities will be maintained
or of the liquidity of the securities in any markets made. In addition, a
trust is restricted under the Investment Company Act of 1940 from selling
securities to the sponsor. The price at which the securities may be sold to
meet redemptions and the value of a trust will be adversely affected if
trading markets for the securities are limited or absent.
ADDITIONAL DEPOSITS. The trust agreement authorizes the sponsor to increase
the size of a trust and the number of units thereof by the deposit of additional
securities, or cash (including a letter of credit) with instructions to purchase
additional securities, in such trust and the issuance of a corresponding number
of additional units. If the sponsor deposits cash, existing and new investors
may experience a dilution of their investments and a reduction in their
anticipated income because of fluctuations in the prices of the securities
between the time of the cash deposit and the purchase of the securities and
because a trust will pay the associated brokerage fees. To minimize this
effect, the trusts will attempt to purchase the securities as close to the
evaluation time or as close to the evaluation prices as possible.
LITIGATION AND LEGISLATION. From time to time Congress considers proposals
to reduce the rate of the dividends-received deduction. Enactment into law of a
proposal to reduce the rate would adversely affect the after-tax return to
investors who can take advantage of the deduction. Unitholders are urged to
consult their own tax advisers. Further, at any time litigation may be
initiated on a variety of grounds, or legislation may be enacted with respect to
the securities in a trust or the issuers of the securities. There can be no
assurance that future litigation or legislation will not have a material adverse
effect on the trust or will not impair the ability of issuers to achieve their
business goals.
ADMINISTRATION OF THE TRUST
DISTRIBUTIONS TO UNITHOLDERS. Income received by a trust is credited by the
trustee to the Income Account of the trust. Other receipts are credited to the
Capital Account of a trust. Income received by a trust will be distributed on
or shortly after the distribution dates each year shown in the prospectus on a
pro rata basis to unitholders of record as of the preceding record date shown in
the prospectus. All distributions will be net of applicable expenses. There is
no assurance that any actual distributions will be made since all dividends
received may be used to pay expenses. In addition, excess amounts from the
Capital Account of a trust, if any, will be distributed at least annually to the
unitholders then of record. Proceeds received from the disposition of any of the
securities after a record date and prior
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to the following distribution date will be held in the Capital Account and not
distributed until the next distribution date applicable to the Capital Account.
The trustee shall be required to make a distribution from the Capital Account if
the cash balance on deposit therein available for distribution shall be
sufficient to distribute at least $1.00 per 100 units. The trustee is not
required to pay interest on funds held in the Capital or Income Accounts (but
may itself earn interest thereon and therefore benefits from the use of such
funds). The trustee is authorized to reinvest any funds held in the Capital or
Income Accounts, pending distribution, in U.S. Treasury obligations which mature
on or before the next applicable distribution date. Any obligations so acquired
must be held until they mature and proceeds therefrom may not be reinvested.
The distribution to the unitholders as of each record date will be made on
the following distribution date or shortly thereafter and shall consist of an
amount substantially equal to such portion of the unitholders' pro rata share of
the dividend distributions then held in the Income Account after deducting
estimated expenses. Because dividends are not received by a trust at a constant
rate throughout the year, such distributions to unitholders are expected to
fluctuate. Persons who purchase units will commence receiving distributions
only after such person becomes a record owner. A person will become the owner
of units, and thereby a unitholder of record, on the date of settlement provided
payment has been received. Notification to the trustee of the transfer of units
is the responsibility of the purchaser, but in the normal course of business
such notice is provided by the selling broker-dealer.
The trustee will periodically deduct from the Income Account of a trust and,
to the extent funds are not sufficient therein, from the Capital Account of a
trust amounts necessary to pay the expenses of a trust. The trustee also may
withdraw from said accounts such amounts, if any, as it deems necessary to
establish a reserve for any governmental charges payable out of a trust.
Amounts so withdrawn shall not be considered a part of a trust's assets until
such time as the trustee shall return all or any part of such amounts to the
appropriate accounts. In addition, the trustee may withdraw from the Income and
Capital Accounts of a trust such amounts as may be necessary to cover
redemptions of units.
DISTRIBUTION REINVESTMENT. Unitholders may elect to have distributions of
capital (including capital gains, if any) or dividends or both automatically
invested into additional units of their trust without a sales fee. In addition,
unitholders may elect to have distributions of capital (including capital gains,
if any) or dividends or both automatically invested without charge in shares of
certain mutual funds, including certain funds underwritten or advised by Scudder
Kemper Investments, Inc., at net asset value if such funds are registered in
such unitholder's state of residence. Since the portfolio securities and
investment objectives of such mutual funds generally will differ significantly
from those of a trust, unitholders should carefully consider the consequences
before selecting such mutual funds for reinvestment. Detailed information with
respect to the investment objectives and the management of such mutual funds is
contained in the prospectus, which can be obtained from the sponsor upon
request. An investor should read the prospectus of the reinvestment fund
selected prior to making the election to reinvest. Unitholders who desire to
have such distributions automatically reinvested should inform their broker at
the time of purchase or should file with the Program Agent referred to below a
written notice of election.
Unitholders who are receiving distributions in cash may elect to participate
in distribution reinvestment by filing with the Program Agent an election to
have such distributions reinvested without charge. Such election must be
received by the Program Agent at least ten days prior to the record date
applicable to any distribution in order to be in effect for such record date.
Any such election shall remain in effect until a subsequent notice is received
by the Program Agent.
The Program Agent is The Bank of New York. All inquiries concerning
participating in distribution reinvestment should be directed to The Bank of New
York at its Unit Investment Trust Division office.
STATEMENTS TO UNITHOLDERS. With each distribution, the trustee will furnish
to each unitholder a statement of the amount of income and the amount of other
receipts, if any, which are being distributed, expressed in each case as a
dollar amount per unit.
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The accounts of a trust are required to be audited annually, at the related
trust's expense, by independent public accountants designated by the sponsor,
unless the sponsor determines that such an audit would not be in the best
interest of the unitholders of the trust. The accountants' report will be
furnished by the trustee to any unitholder upon written request. Within a
reasonable period of time after the end of each calendar year, the trustee shall
furnish to each person who at any time during the calendar year was a unitholder
of a trust a statement, covering the calendar year, setting forth for the trust:
(A) As to the Income Account:
(1) Income received;
(2) Deductions for applicable taxes and for fees and expenses of the
trust and for redemptions of units, if any; and
(3) The balance remaining after such distributions and deductions,
expressed in each case both as a total dollar amount and as a dollar
amount representing the pro rata share of each unit outstanding on
the last business day of such calendar year; and
(B) As to the Capital Account:
(1) The dates of disposition of any securities and the net proceeds
received therefrom;
(2) Deductions for payment of applicable taxes and fees and expenses of
the trust held for distribution to unitholders of record as of a
date prior to the determination; and
(3) The balance remaining after such distributions and deductions
expressed both as a total dollar amount and as a dollar amount
representing the pro rata share of each unit outstanding on the last
business day of such calendar year; and
(C) The following information:
(1) A list of the securities as of the last business day of such
calendar year;
(2) The number of units outstanding on the last business day of such
calendar year;
(3) The redemption price based on the last evaluation made during such
calendar year;
(4) The amount actually distributed during such calendar year from the
Income and Capital Accounts separately stated, expressed both as
total dollar amounts and as dollar amounts per unit outstanding on
the record dates for each such distribution.
RIGHTS OF UNITHOLDERS. A unitholder may at any time tender units to the
trustee for redemption. The death or incapacity of any unitholder will not
operate to terminate a trust nor entitle legal representatives or heirs to claim
an accounting or to bring any action or proceeding in any court for partition or
winding up of a trust. No unitholder shall have the right to control the
operation and management of a trust in any manner, except to vote with respect
to the amendment of the trust agreement or termination of a trust.
AMENDMENT AND TERMINATION. The trust agreement may be amended by the trustee
and the sponsor without the consent of any of the unitholders: (1) to cure any
ambiguity or to correct or supplement any provision which may be defective or
inconsistent; (2) to change any provision thereof as may be required by the
Securities and Exchange Commission or any successor governmental agency; or (3)
to make such provisions as shall not adversely affect the
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interests of the unitholders. The trust agreement with respect to any trust may
also be amended in any respect by the sponsor and the trustee, or any of the
provisions thereof may be waived, with the consent of the holders of units
representing 66 2/3% of the units then outstanding of the trust, provided that
no such amendment or waiver will reduce the interest of any unitholder thereof
without the consent of such unitholder or reduce the percentage of units
required to consent to any such amendment or waiver without the consent of all
unitholders of the trust. In no event shall the trust agreement be amended to
increase the number of units of a trust issuable thereunder or to permit the
acquisition of any securities in addition to or in substitution for those
initially deposited in the trust, except in accordance with the provisions of
the trust agreement. The trustee shall promptly notify unitholders of the
substance of any such amendment.
The trust agreement provides that a trust shall terminate upon the
liquidation, redemption or other disposition of the last of the securities held
in the trust but in no event is it to continue beyond the mandatory termination
date set forth in the prospectus. If the value of a trust shall be less than
the applicable minimum value stated in the prospectus (generally 20% of the
total value of securities deposited in the trust during the initial offering
period), the trustee may, in its discretion, and shall, when so directed by the
sponsor, terminate the trust. A trust may be terminated at any time by the
holders of units representing 66 2/3% of the units thereof then outstanding. In
addition, the sponsor may terminate a trust if it is based on a security index
and the index is no longer maintained.
Beginning nine business days prior to, but no later than, the mandatory
termination date described in the prospectus, the trustee may begin to sell all
of the remaining underlying securities on behalf of unitholders in connection
with the termination of the trust. The sponsor may assist the trustee in these
sales and receive compensation to the extent permitted by applicable law. The
sale proceeds will be net of any incidental expenses involved in the sales.
The sponsor will attempt to sell the securities as quickly as it can during
the termination proceedings without in its judgment materially adversely
affecting the market price of the securities, but it is expected that all of the
securities will in any event be disposed of within a reasonable time after a
trust's termination. The sponsor does not anticipate that the period will be
longer than one month, and it could be as short as one day, depending on the
liquidity of the securities being sold. The liquidity of any security depends
on the daily trading volume of the security and the amount that the sponsor has
available for sale on any particular day. Of course, no assurances can be given
that the market value of the securities will not be adversely affected during
the termination proceedings.
Approximately thirty days prior to termination of a trust, the trustee will
notify unitholders of the termination and provide a form allowing qualifying
unitholders to elect an in kind distribution. A unitholder who owns the minimum
number of units shown in the prospectus may request an in kind distribution from
the trustee instead of cash. The trustee will make an in kind distribution
through the distribution of each of the securities of the trust in book entry
form to the account of the unitholder's bank or broker-dealer at Depository
Trust Company. The unitholder will be entitled to receive whole shares of each
of the securities comprising the portfolio of a trust and cash from the Capital
Account equal to the fractional shares to which the unitholder is entitled. The
trustee may adjust the number of shares of any security included in a
unitholder's in kind distribution to facilitate the distribution of whole
shares. The sponsor may terminate the in kind distribution option at any time
upon notice to the unitholders. Special federal income tax consequences will
result if a unitholder requests an in kind distribution.
Within a reasonable period after termination, the trustee will sell any
securities remaining in a trust and, after paying all expenses and charges
incurred by the trust, will distribute to unitholders thereof (upon surrender
for cancellation of certificates for units, if issued) their pro rata share of
the balances remaining in the Income and Capital Accounts of the trust.
The sponsor currently intends, but is not obligated, to offer for sale units
of a subsequent series of a trust at approximately the time of the mandatory
termination date. If the sponsor does offer such units for sale, unitholders
may be given the opportunity to purchase such units at a public offering price
which includes a reduced sales fee.
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There is, however, no assurance that units of any new series of a trust will
be offered for sale at that time, or if offered, that there will be sufficient
units available for sale to meet the requests of any or all unitholders.
THE TRUSTEE. The trustee is The Bank of New York, a trust company organized
under the laws of New York. The Bank of New York has its Unit Investment Trust
Division offices at 101 Barclay Street, New York, New York 10007, telephone 1-
800-701-8178. The Bank of New York is subject to supervision and examination by
the Superintendent of Banks of the State of New York and the Board of Governors
of the Federal Reserve System, and its deposits are insured by the Federal
Deposit Insurance Corporation to the extent permitted by law.
The trustee, whose duties are ministerial in nature, has not participated in
selecting the portfolio of any trust. In accordance with the trust agreement,
the trustee shall keep records of all transactions at its office. Such records
shall include the name and address of, and the number of units held by, every
unitholder of a trust. Such books and records shall be open to inspection by
any unitholder at all reasonable times during usual business hours. The trustee
shall make such annual or other reports as may from time to time be required
under any applicable state or federal statute, rule or regulation. The trustee
shall keep a certified copy or duplicate original of the trust agreement on file
in its office available for inspection at all reasonable times during usual
business hours by any unitholder, together with a current list of the securities
held in each trust. Pursuant to the trust agreement, the trustee may employ one
or more agents for the purpose of custody and safeguarding of securities
comprising a trust.
Under the trust agreement, the trustee or any successor trustee may resign
and be discharged of a trust created by the trust agreement by executing an
instrument in writing and filing the same with the sponsor.
The trustee or successor trustee must mail a copy of the notice of
resignation to all unitholders then of record, not less than sixty days before
the date specified in such notice when such resignation is to take effect. The
sponsor upon receiving notice of such resignation is obligated to appoint a
successor trustee promptly. If, upon such resignation, no successor trustee has
been appointed and has accepted the appointment within thirty days after
notification, the retiring trustee may apply to a court of competent
jurisdiction for the appointment of a successor. The sponsor may at any time
remove the trustee, with or without cause, and appoint a successor trustee as
provided in the trust agreement. Notice of such removal and appointment shall
be mailed to each unitholder by the sponsor. Upon execution of a written
acceptance of such appointment by such successor trustee, all the rights,
powers, duties and obligations of the original trustee shall vest in the
successor. The trustee must be a corporation organized under the laws of the
United States, or any state thereof, be authorized under such laws to exercise
trust powers and have at all times an aggregate capital, surplus and undivided
profits of not less than $5,000,000.
THE SPONSOR. Ranson & Associates, Inc., the sponsor, is an investment
banking firm created in 1995 by a number of former owners and employees of
Ranson Capital Corporation. Ranson & Associates, Inc. is the successor sponsor
to unit investment trusts formerly sponsored by EVEREN Unit Investment Trusts, a
service of EVEREN Securities, Inc. Ranson & Associates, Inc. is also the
sponsor and successor sponsor of Series of The Kansas Tax-Exempt Trust and
Multi-State Series of The Ranson Municipal Trust. Ranson & Associates, Inc.
is the successor to a series of companies, the first of which was originally
organized in Kansas in 1935. During its history, Ranson & Associates, Inc.
and its predecessors have been active in public and corporate finance and
have sold bonds and unit investment trusts and maintained secondary market
activities relating thereto. At present, Ranson & Associates, Inc., which
is a member of the National Association of Securities Dealers, Inc., is the
sponsor to each of the above-named unit investment trusts and serves as the
financial advisor and as an underwriter for Kansas municipalities. The
sponsor's offices are located at 250 North Rock Road, Suite 150, Wichita,
Kansas 67206-2241.
If at any time the sponsor shall fail to perform any of its duties under the
trust agreement or shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or shall have its affairs taken over by public
authorities, then the trustee may (a) appoint a successor sponsor at rates of
compensation deemed by the trustee to be reasonable and not exceeding such
reasonable amounts as may be prescribed by the Securities and Exchange
Commission, or (b) terminate the trust agreement and liquidate any trust as
provided therein, or (c) continue to act as trustee without terminating the
trust agreement.
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The foregoing financial information with regard to the sponsor relates to the
sponsor only and not to the trust. Such information is included in this
Prospectus only for the purpose of informing investors as to the financial
responsibility of the sponsor and its ability to carry out its contractual
obligations with respect to the trust. More comprehensive financial information
can be obtained upon request from the sponsor.
THE SUPERVISOR AND EVALUATOR. Ranson & Associates, Inc., the sponsor, also
serves as evaluator and supervisor. The evaluator and supervisor may resign or
be removed by the trustee in which event the trustee is to use its best efforts
to appoint a satisfactory successor. Such resignation or removal shall become
effective upon acceptance of appointment by the successor evaluator. If upon
resignation of the evaluator no successor has accepted appointment within thirty
days after notice of resignation, the evaluator may apply to a court of
competent jurisdiction for the appointment of a successor. Notice of such
registration or removal and appointment shall be mailed by the trustee to each
unitholder.
LIMITATIONS ON LIABILITY. The sponsor is liable for the performance of its
obligations arising from its responsibilities under the trust agreement, but
will be under no liability to the unitholders for taking any action or
refraining from any action in good faith pursuant to the trust agreement or for
errors in judgment, except in cases of its own gross negligence, bad faith or
willful misconduct or its reckless disregard for its duties thereunder. The
sponsor shall not be liable or responsible in any way for depreciation or loss
incurred by reason of the sale of any securities.
The trust agreement provides that the trustee shall be under no liability for
any action taken in good faith in reliance upon prima facie properly executed
documents or for the disposition of moneys, securities or certificates except by
reason of its own negligence, bad faith or willful misconduct, or its reckless
disregard for its duties under the trust agreement, nor shall the trustee be
liable or responsible in any way for depreciation or loss incurred by reason of
the sale by the trustee of any securities. In the event that the sponsor shall
fail to act, the trustee may act and shall not be liable for any such action
taken by it in good faith. The trustee shall not be personally liable for any
taxes or other governmental charges imposed upon or in respect of the securities
or upon the interest thereof. In addition, the trust agreement contains other
customary provisions limiting the liability of the trustee.
The trustee and unitholders may rely on any evaluation furnished by the
evaluator and shall have no responsibility for the accuracy thereof. The trust
agreement provides that the determinations made by the evaluator shall be made
in good faith upon the basis of the best information available to it, provided,
however, that the evaluator shall be under no liability to the trustee or
unitholders for errors in judgment, but shall be liable for its gross
negligence, bad faith or willful misconduct or its reckless disregard for its
obligations under the trust agreement.
EXPENSES OF THE TRUST. The sponsor will not charge a trust any fees for
services performed as sponsor. The sponsor will receive a portion of the sale
commissions paid in connection with the purchase of units and will share in
profits, if any, related to the deposit of securities in the trust.
The trustee receives for its services that fee set forth in the prospectus.
The trustee's fee which is calculated monthly is based on the largest number of
units of a trust outstanding during the calendar year for which such
compensation relates. The trustee benefits to the extent there are funds for
future distributions, payment of expenses and redemptions in the Capital and
Income Accounts since these Accounts are non-interest bearing and the amounts
earned by the trustee are retained by the trustee. Part of the trustee's
compensation for its services to a trust is expected to result from the use of
these funds.
In its capacity as supervisor, the sponsor will charge a trust a surveillance
fee for services performed for the trust in an amount not to exceed that amount
set forth in the prospectus but in no event will such compensation, when
combined with all compensation received from other unit investment trusts for
which the sponsor both acts as sponsor and provides portfolio surveillance,
exceed the aggregate cost to the sponsor for providing such services. Such fee
shall be based on the total number of units of the related trust outstanding as
of the January record date for any annual period.
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For evaluation of the securities in a trust, the evaluator shall receive that
fee set forth in the prospectus, payable monthly, based upon the largest number
of units of the trust outstanding during the calendar year for which such
compensation relates.
The trustee's fee, supervisor's fee and evaluator's fee are deducted from the
Income Account of the related trust to the extent funds are available and then
from the Capital Account. Each such fee may be increased without approval of
unitholders by amounts not exceeding a proportionate increase in the Consumer
Price Index or any equivalent index substituted therefor.
A Nasdaq-100 Trust Licensor receives an annual fee from each Nasdaq-100 trust
equal to the greater of (a) .02% of the average net asset value of the trust
computed quarterly or (b) a minimum of $7,000 during the first year of the
trust's life, $8,000 during the second year of the trust's life and $9,000
thereafter. This fee covers the license to the trust of the use of various
trademarks and trade names. This fee may be increased annually by the amount of
the increase, if any, in the Consumer Price Index for Urban Consumers, All
Items, as issued by the Bureau of Labor Statistics, U.S. Department of Labor,
over the prior twelve-month period.
The trust will pay a fee to the sponsor for creating and developing the
trust, including determining the trust objective, policies, composition and
size, selecting service providers and information services, and for providing
other similar administrative and ministerial functions. Your trust pays this
"creation and development fee" as a percentage of your trust's average daily net
asset value (not to exceed the percentage of your initial investment over the
life of the trust set forth in the prospectus). The sponsor does not use the
fee to pay distribution expenses or as compensation for sales efforts.
The following additional charges are or may be incurred by the trust: (a)
fees for the trustee's extraordinary services; (b) expenses of the trustee
(including legal and auditing expenses, but not including any fees and expenses
charged by an agent for custody and safeguarding of securities) and of counsel,
if any; (c) various governmental charges; (d) expenses and costs of any action
taken by the trustee to protect the trust or the rights and interests of the
unitholders; (e) indemnification of the trustee for any loss, liability or
expense incurred by it in the administration of the trust not resulting from
negligence, bad faith or willful misconduct on its part or its reckless
disregard for its obligations under the trust agreement; (f) indemnification of
the sponsor for any loss, liability or expense incurred in acting in that
capacity without gross negligence, bad faith or willful misconduct or its
reckless disregard for its obligations under the trust agreement; (g) any
offering costs incurred after the end of the initial offering period; and (h)
expenditures incurred in contacting unitholders upon termination of the trust.
The fees and expenses set forth herein are payable out of a trust and, when
owing to the trustee, are secured by a lien on the trust. Since the securities
are all stocks, and the income stream produced by dividend payments, if any, is
unpredictable, the sponsor cannot provide any assurance that dividends will be
sufficient to meet any or all expenses of a trust. If the balances in the
Income and Capital Accounts are insufficient to provide for amounts payable by
the trust, the trustee has the power to sell securities to pay such amounts.
These sales may result in capital gains or losses to unitholders. It is
expected that the income stream produced by dividend payments may be
insufficient to meet the expenses of a trust and, accordingly, it is expected
that securities will be sold to pay all of the fees and expenses of the trust.
A trust may pay the costs of updating its registration statement each year.
Unit investment trust sponsors have historically paid these expenses.
PORTFOLIO TRANSACTIONS AND BROKERAGE ALLOCATION
When a trust sells securities, the composition and diversity of the
securities in the trust may be altered. In order to obtain the best price for a
trust, it may be necessary for the supervisor to specify minimum amounts (such
as 100 shares) in which blocks of securities are to be sold. In effecting
purchases and sales of a trust's portfolio securities, the sponsor may direct
that orders be placed with and brokerage commissions be paid to brokers,
including brokers which may be affiliated with the trust, the sponsor or dealers
participating in the offering of units. In addition, in selecting among firms to
handle a particular transaction, the sponsor may take into account whether the
firm has sold or is selling products which it sponsors.
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PURCHASE, REDEMPTION AND PRICING OF UNITS
PUBLIC OFFERING PRICE. Units of a trust are offered at the public offering
price (which is based on the aggregate underlying value of the securities in the
trust and includes the sales fee plus a pro rata share of any accumulated
amounts in the accounts of the trust). The sales fee is described in the
prospectus. During the initial offering period, portion of the public offering
price includes an amount of securities to pay for all or a portion of the costs
incurred in establishing a trust. These costs include the cost of preparing the
registration statement, the trust indenture and other closing documents,
registering units with the Securities and Exchange Commission and states, the
initial audit of the trust portfolio, legal fees and the initial fees and
expenses of the trustee. These costs will be deducted from a trust as of the
end of the initial offering period or after six months, if earlier.
As indicated above, the initial public offering price of the units was
established by dividing the aggregate underlying value of the securities by the
number of units outstanding. Such price determination as of the opening of
business on the date a trust was created was made on the basis of an evaluation
of the securities in the trust prepared by the trustee. After the opening of
business on this date, the evaluator will appraise or cause to be appraised
daily the value of the underlying securities as of the close of the New York
Stock Exchange on days the New York Stock Exchange is open and will adjust the
public offering price of the units commensurate with such valuation. Such
public offering price will be effective for all orders received at or prior to
the close of trading on the New York Stock Exchange on each such day. Orders
received by the trustee, sponsor or any dealer for purchases, sales or
redemptions after that time, or on a day when the New York Stock Exchange is
closed, will be held until the next determination of price.
The value of the securities is determined on each business day by the
evaluator based on the closing sale prices on a national securities exchange or
The Nasdaq National Market or by taking into account the same factors referred
to under "Computation of Redemption Price."
PUBLIC DISTRIBUTION OF UNITS. During the initial offering period, units of a
trust will be distributed to the public at the public offering price thereof.
Upon the completion of the initial offering, units which remain unsold or which
may be acquired in the secondary market may be offered at the public offering
price determined in the manner provided above.
The sponsor intends to qualify units of a trust for sale in a number of
states. Units will be sold through dealers who are members of the National
Association of Securities Dealers, Inc. and through others. Broker-dealers and
others will be allowed a concession or agency commission in connection with the
distribution of units during the initial offering period as set forth in the
prospectus.
Certain commercial banks may be making units of a trust available to their
customers on an agency basis. A portion of the sales charge paid by their
customers is retained by or remitted to the banks in the amount of the broker-
dealer concession or agency commission set forth in the prospectus. Banks may be
prohibited from underwriting trust units; however, certain agency transactions
may be permitted. In addition, state securities laws on this issue may differ
from the interpretations of federal law expressed herein and banks and financial
institutions may be required to register as dealers pursuant to state law. The
sponsor reserves the right to change the concessions or agency commissions set
forth in the prospectus from time to time. In addition to such concessions or
agency commissions, the sponsor may, from time to time, pay or allow additional
concessions or agency commissions, in the form of cash or other compensation, to
dealers employing registered representatives who sell, during a specified time
period, a minimum dollar amount of units of unit investment trusts underwritten
by the sponsor. At various times the sponsor may implement programs under which
the sales force of a broker or dealer may be eligible to win nominal awards for
certain sales efforts, or under which the sponsor will reallow to any such
broker or dealer that sponsors sales contests or recognition programs conforming
to criteria established by the sponsor, or participates in sales programs
sponsored by the sponsor, an amount not exceeding the total applicable sales
charges on the sales generated by such person at the public offering price
during such programs. Also, the sponsor in its discretion may from time to time
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pursuant to objective criteria established by the sponsor pay fees to qualifying
brokers or dealers for certain services or activities which are primarily
intended to result in sales of units of a trust. Such payments are made by the
sponsor out of its own assets, and not out of the assets of any trust. These
programs will not change the price unitholders pay for their units or the amount
that a trust will receive from the units sold. The difference between the
discount and the sales charge will be retained by the sponsor.
The sponsor reserves the right to reject, in whole or in part, any order for
the purchase of units.
SPONSOR PROFITS. The sponsor will receive gross sales charges equal to the
percentage of the public offering price of the units of a trust described in the
prospectus. In addition, the sponsor may realize a profit (or sustain a loss) as
of the date a trust is created resulting from the difference between the
purchase prices of the securities to the sponsor and the cost of such securities
to the trust. Thereafter, on subsequent deposits the sponsor may realize
profits or sustain losses from such deposits. The sponsor may realize
additional profits or losses during the initial offering period on unsold units
as a result of changes in the daily market value of the securities in the trust.
MARKET FOR UNITS. After the initial offering period, the sponsor may
maintain a market for units of a trust offered hereby and continuously offer to
purchase said units at prices, determined by the evaluator, based on the value
of the underlying securities. While the sponsor may repurchase units from time
to time, it does not currently intend to maintain an active secondary market for
units. Unitholders who wish to dispose of their units should inquire of their
broker as to current market prices in order to determine whether there is in
existence any price in excess of the redemption price and, if so, the amount
thereof. The offering price of any units resold by the sponsor will be in
accord with that described in the currently effective prospectus describing such
units. Any profit or loss resulting from the resale of such units will belong
to the sponsor. If the sponsor decides to maintain a secondary market, it may
suspend or discontinue purchases of units of the trust if the supply of units
exceeds demand, or for other business reasons.
REDEMPTION. A unitholder who does not dispose of units in the secondary
market described above may cause units to be redeemed by the trustee by making a
written request to the trustee at its Unit Investment trust Division office in
the city of New York and, in the case of units evidenced by a certificate, by
tendering such certificate to the trustee properly endorsed or accompanied by a
written instrument or instruments of transfer in form satisfactory to the
trustee. Unitholders must sign the request, and such certificate or transfer
instrument, exactly as their names appear on the records of the trustee and on
any certificate representing the units to be redeemed. If the amount of the
redemption is $500 or less and the proceeds are payable to the unitholder(s) of
record at the address of record, no signature guarantee is necessary for
redemptions by individual account owners (including joint owners). Additional
documentation may be requested, and a signature guarantee is always required,
from corporations, executors, administrators, trustees, guardians or
associations. The signatures must be guaranteed by a participant in the
Securities Transfer Agents Medallion Program ("STAMP") or such other signature
guaranty program in addition to, or in substitution for, STAMP, as may be
accepted by the trustee. A certificate should only be sent by registered or
certified mail for the protection of the unitholder. Since tender of the
certificate is required for redemption when one has been issued, units
represented by a certificate cannot be redeemed until the certificate
representing such units has been received by the purchasers.
Redemption shall be made by the trustee no later than the seventh day
following the day on which a tender for redemption is received (the "Redemption
Date") by payment of cash equivalent to the redemption price, determined as set
forth below under "Computation of Redemption Price," as of the close of the New
York Stock Exchange next following such tender, multiplied by the number of
units being redeemed. Any units redeemed shall be canceled and any undivided
fractional interest in the related trust extinguished. The price received upon
redemption might be more or less than the amount paid by the unitholder
depending on the value of the securities in the trust at the time of redemption.
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Under regulations issued by the Internal Revenue Service, the trustee is
required to withhold a specified percentage of the principal amount of a unit
redemption if the trustee has not been furnished the redeeming unitholder's tax
identification number in the manner required by such regulations. Any amount so
withheld is transmitted to the Internal Revenue Service and may be recovered by
the unitholder only when filing a tax return. Under normal circumstances the
trustee obtains the unitholder's tax identification number from the selling
broker. However, any time a unitholder elects to tender units for redemption,
such unitholder should make sure that the trustee has been provided a certified
tax identification number in order to avoid this possible "back-up withholding."
In the event the trustee has not been previously provided such number, one must
be provided at the time redemption is requested. Any amounts paid on redemption
representing unpaid dividends shall be withdrawn from the Income Account of a
trust to the extent that funds are available for such purpose. All other
amounts paid on redemption shall be withdrawn from the Capital Account for a
trust.
Unitholders tendering units for redemption may request a distribution in kind
(a "Distribution In Kind") from the trustee in lieu of cash redemption a
unitholder may request a Distribution In Kind of an amount and value of
securities per unit equal to the redemption price per unit as determined as of
the evaluation time next following the tender, provided that the tendering
unitholder is (1) entitled to receive at least $1,000,000 of proceeds as part of
his or her distribution or if he paid at least $1,000,000 to acquire the units
being tendered and (2) the unitholder has elected to redeem at least thirty days
prior to the termination of the trust. If the unitholder meets these
requirements, a Distribution In Kind will be made by the trustee through the
distribution of each of the securities of the trust in book entry form to the
account of the unitholder's bank or broker-dealer at Depositor Trust Company.
The tendering unitholder shall be entitled to receive whole shares of each of
the securities comprising the portfolio of the trust and cash from the Capital
Account equal to the fractional shares to which the tendering unitholder is
entitled. The trustee shall make any adjustments necessary to reflect
differences between the redemption price of the units and the value of the
securities distributed in kind as of the date of tender. If funds in the Capital
Account are insufficient to cover the required cash distribution to the
tendering unitholder, the trustee may sell securities. The in kind redemption
option may be terminated by the sponsor at any time.
The trustee is empowered to sell securities in order to make funds available
for the redemption of units. To the extent that securities are sold or redeemed
in kind, the size of a trust will be, and the diversity of a trust may be,
reduced but each remaining unit will continue to represent approximately the
same proportional interest in each security. Sales may be required at a time
when securities would not otherwise be sold and may result in lower prices than
might otherwise be realized. The price received upon redemption may be more or
less than the amount paid by the unitholder depending on the value of the
securities in the portfolio at the time of redemption.
The right of redemption may be suspended and payment postponed (1) for any
period during which the New York Stock Exchange is closed, other than customary
weekend and holiday closings, or during which (as determined by the Securities
and Exchange Commission) trading on the New York Stock Exchange is restricted;
(2) for any period during which an emergency exists as a result of which
disposal by the trustee of securities is not reasonably practicable or it is not
reasonably practicable to fairly determine the value of the underlying
securities in accordance with the trust agreement; or (3) for such other period
as the Securities and Exchange Commission may by order permit. The trustee is
not liable to any person in any way for any loss or damage which may result from
any such suspension or postponement.
COMPUTATION OF REDEMPTION PRICE. The redemption price per unit (as well as
the secondary market public offering price) will generally be determined on the
basis of the last sale price of the securities in a trust. The redemption price
per unit is the pro rata share of each unit in a trust determined on the basis
of (i) the cash on hand in the trust or moneys in the process of being collected
and (ii) the value of the securities in the trust less (a) amounts representing
taxes or other governmental charges payable out of the trust, (b) any amount
owing to the trustee for its advances and (c) the accrued expenses of the trust.
During the initial offering period, the redemption price and the secondary
market repurchase price will also include estimated organizational and offering
costs. The evaluator may determine the value of the securities in the trust in
the following manner: if the security is listed on a national
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securities exchange or the Nasdaq Stock Market, the evaluation will generally be
based on the last sale price on the exchange or Nasdaq (unless the evaluator
deems the price inappropriate as a basis for evaluation). If the security is
not so listed or, if so listed and the principal market for the security is
other than on the exchange or Nasdaq, the evaluation will generally be made by
the evaluator in good faith based on the last bid price on the over-the-counter
market (unless the evaluator deems such price inappropriate as a basis for
evaluation) or, if a bid price is not available, (1) on the basis of the current
bid price for comparable securities, (2) by the evaluator's appraising the value
of the securities in good faith at the bid side of the market or (3) by any
combination thereof.
RETIREMENT PLANS. A trust may be well suited for purchase by Individual
Retirement Accounts, Keogh Plans, pension funds and other qualified retirement
plans. Generally, capital gains and income received under each of the foregoing
plans are deferred from Federal taxation. All distributions from such plans are
generally treated as ordinary income but may, in some cases, be eligible for
special income averaging or tax-deferred rollover treatment. Investors
considering participation in any such plan should review specific tax laws
related thereto and should consult their attorneys or tax advisers with respect
to the establishment and maintenance of any such plan. Such plans are offered
by brokerage firms and other financial institutions. The trust will lower the
minimum investment requirement for IRA accounts. Fees and charges with respect
to such plans may vary.
The trustee has agreed to act as custodian for certain retirement plan
accounts. An annual fee per account, if not paid separately, will be assessed by
the trustee and paid through the liquidation of shares of the reinvestment
account. An individual wishing the trustee to act as custodian must complete a
Ranson UIT/IRA application and forward it along with a check made payable to The
Bank of New York. Certificates for Individual Retirement Accounts cannot be
issued.
OWNERSHIP OF UNITS. Ownership of units will not be evidenced by certificates
unless a unitholder, the unitholder's registered broker/dealer or the clearing
agent for such broker/dealer makes a written request to the trustee. Units are
transferable by making a written request to the trustee and, in the case of
units evidenced by a certificate, by presenting and surrendering such
certificate to the trustee properly endorsed or accompanied by a written
instrument or instruments of transfer which should be sent by registered or
certified mail for the protection of the unitholder. Unitholders must sign such
written request, and such certificate or transfer instrument, exactly as their
names appear on the records of the trustee and on any certificate representing
the units to be transferred. Such signatures must be guaranteed as described
above.
Units may be purchased and certificates, if requested, will be issued in
denominations of one unit or any multiple thereof, subject to the minimum
investment requirement. Fractions of units, if any, will be computed to three
decimal places. Any certificate issued will be numbered serially for
identification, issued in fully registered form and will be transferable only on
the books of the trustee. The trustee may require a unitholder to pay a
reasonable fee, to be determined in the sole discretion of the trustee, for each
certificate re-issued or transferred and to pay any governmental charge that may
be imposed in connection with each such transfer or interchange. The trustee at
the present time does not intend to charge for the normal transfer or
interchange of certificates. Destroyed, stolen, mutilated or lost certificates
will be replaced upon delivery to the trustee of satisfactory indemnity
(generally amounting to 3% of the market value of the units), affidavit of loss,
evidence of ownership and payment of expenses incurred.
TAXATION
Each trust intends to elect and qualify on a continuing basis for special
federal income tax treatment as a "regulated investment company" under the
Internal Revenue Code of 1986, as amended (the "Code"). If the trust so
qualifies and timely distributes to unitholders 90% or more of its taxable
income (without regard to its net capital gain, i.e., the excess of its net
long-term capital gain over its net short-term capital loss), it will not be
subject to federal income tax on the portion of its taxable income (including
any net capital gain) that it distributes to unitholders. In addition, to the
extent the trust timely distributes to unitholders at least 98% of its
taxable income
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(including any net capital gain), it will not be subject to the 4% excise tax on
certain undistributed income of "regulated investment companies." Because the
trust intends to timely distribute its taxable income (including any net capital
gain), it is anticipated that the trust will not be subject to federal income
tax or the excise tax.
Distributions to unitholders of the trust's income, other than distributions
which are designated as capital gain dividends, will be taxable as ordinary
income to unitholders, except that to the extent that distributions to a
unitholder in any year exceed the trust's current and accumulated earnings and
profits, they will be treated as a return of capital and will reduce the
unitholder's basis in his units and, to the extent that they exceed his basis,
will be treated as a gain from the sale of his units as discussed below.
Although distributions generally will be treated as distributed when paid,
distributions declared in October, November or December payable to unitholders
of record on a specified date in one of those months and paid during January of
the following year will be treated as having been distributed by the trust (and
received by the unitholder) on December 31 of the year such distributions are
declared.
Distributions of the trust's net capital gain which are properly designated
as capital gain dividends by the trust will be taxable to unitholders as long-
term capital gain, regardless of the length of time the units have been held by
a unitholder. A unitholder may recognize a taxable gain or loss if the
unitholder sells or redeems his units. Any gain or loss arising from (or treated
as arising from) the sale or redemption of units will generally be a capital
gain or loss, except in the case of a dealer or a financial institution. The
Internal Revenue Service Restructuring and Reform Act of 1998 (the "1998 Tax
Act") provides that for taxpayers other than corporations, net capital gain
(which is defined as net long-term capital gain over net short-term capital loss
for the taxable year) realized from property (with certain exceptions) is
generally subject to a maximum marginal stated tax rate of 20% (10% in the case
of certain taxpayers in the lowest tax bracket). Capital gain or loss is long-
term if the holding period for the asset is more than one year, and is short-
term if the holding period for the asset is one year or less. The date on which
a unit is acquired (i.e., the "trade date") is excluded for purposes for
determining the holding period of the unit. Capital gains realized from assets
held for one year or less are taxed at the same rates as ordinary income. Note
that if a unitholder holds units for six months or less and subsequently sells
such units at a loss, the loss will be treated as a long-term capital loss to
the extent that any long-term capital gain distribution is made with respect to
such units during the six-month period or less that the unitholder owns the
units. In addition, please note that capital gains may be recharacterized as
ordinary income in the case of certain financial transactions that are
considered "conversion transactions" effective for transactions entered into
after April 30, 1993. Unitholders and prospective investors should consult with
their tax advisers regarding the potential effect of this provision on their
investment in units.
The Taxpayer Relief Act of 1997 includes provisions that treat certain
transactions designed to reduce or eliminate risk of loss and opportunities for
gain (e.g. short sales, offsetting notional principal contracts, futures or
forward contracts or similar transactions) as constructive sales for purposes of
recognition of gain (but not loss) and for purposes of determining the holding
period. Unitholders should consult their tax advisers with regard to any such
constructive sales rules.
Generally, the tax basis of a unitholder includes sales charges, and such
charges are not deductible. A portion of the sales charge for the trust may be
deferred. The income (or proceeds from redemption) a unitholder must take into
account for federal income tax purposes is not reduced by amounts deducted to
pay any deferred sales charge.
Distributions which are taxable as ordinary income to unitholders will
constitute dividends for federal income tax purposes. When units are held by
corporate unitholders, trust distributions may qualify for the 70% dividends
received deduction, subject to limitations otherwise applicable to the
availability of the deduction, to the extent the distribution is attributable to
dividends received by the trust from United States corporations (other than real
estate investment trusts) and is designated by the trust as being eligible for
such deduction. To the extent dividends received by the trust are attributable
to foreign corporations, a corporation that owns units will not be entitled to
the dividends received deduction with respect to its pro rata portion of such
dividends, since the dividends received deduction is
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generally available only with respect to dividends paid by domestic
corporations. The trust will provide each unitholder with information annually
concerning what part of the trust distributions are eligible for the dividends
received deduction.
The trust may elect to pass through to the unitholders the foreign income and
similar taxes paid by the trust in order to enable such unitholders to take a
credit (or deduction) for foreign income taxes paid by the trust. If such an
election is made, unitholders of the trust, because they are deemed to own a pro
rata portion of the foreign securities held by the trust, must include in their
gross income, for federal income tax purposes, both their portion of dividends
received by the trust and also their portion of the amount which the trust deems
to be the unitholders' portion of foreign income taxes paid with respect to, or
withheld from, dividends, interest or other income of the trust from its foreign
investments. Unitholders may then subtract from their federal income tax the
amount of such taxes withheld, or else treat such foreign taxes as deductions
from gross income; however, as in the case of investors receiving income
directly from foreign sources, the above described tax credit or deduction is
subject to certain limitations. A required holding period for such credits is
imposed. Unitholders should consult their tax advisers regarding this election
and its consequences to them.
Under the Code, certain miscellaneous itemized deductions, such as investment
expenses, tax return preparation fees and employee business expenses, will be
deductible by individuals only to the extent they exceed 2% of adjusted gross
income. Miscellaneous itemized deductions subject to this limitation under
present law do not include expenses incurred by the trust so long as the units
are held by or for 500 or more persons at all times during the taxable year or
another exception is met. In the event the units are held by fewer than 500
persons, additional taxable income may be realized by the individual (and other
noncorporate) unitholders in excess of the distributions received from the
trust.
Distributions reinvested into additional units of the trust will be taxed to
a unitholder in the manner described above (i.e., as ordinary income, long-term
capital gain or as a return of capital).
Under certain circumstances a unitholder may be able to request an in kind
distribution upon termination of the trust. Unitholders electing an in kind
distribution of stock should be aware that the exchange is subject to taxation
and unitholders will recognize gain or loss based on the value of the securities
received. Investors electing an in kind distribution should consult their own
tax advisers with regard to such transactions.
The federal tax status of each year's distributions will be reported to
unitholders and to the Internal Revenue Service. Each unitholder will be
requested to provide the unitholder's taxpayer identification number to the
trustee and to certify that the unitholder has not been notified that payments
to the unitholder are subject to back-up withholding. If the proper taxpayer
identification number and appropriate certification are not provided when
requested, distributions to such unitholder (including amounts received upon the
redemption of units) will be subject to back-up withholding.
The foregoing discussion relates only to the federal income tax status of
your trust and to the tax treatment of distributions by the trust to United
States unitholders.
A unitholder who is a foreign investor (i.e., an investor other than a United
States citizen or resident or a United States corporation, partnership, estate
or trust) should be aware that, generally, subject to applicable tax treaties,
distributions from a trust which constitute dividends for Federal income tax
purposes (other than dividends which the trust designates as capital gain
dividends) will be subject to United States income taxes, including withholding
taxes. However, distributions received by a foreign investor from a trust that
are designated by the trust as capital gain dividends should not be subject to
United States Federal income taxes, including withholding taxes, if all of the
following conditions are met (i) the capital gain dividend is not effectively
connected with the conduct by the foreign investor of a trade or business within
the United States, (ii) the foreign investor (if an individual) is not present
in the United States for 183 days or more during his or her taxable year, and
(iii) the foreign investor
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provides all certification which may be required of his status (foreign
investors may contact the Sponsor to obtain a Form W-8BEN which must be filed
with the trustee and refiled every three calendar years thereafter). Foreign
investors should consult their tax advisers with respect to United States tax
consequences of ownership of units. Units in the trust and trust distributions
may also be subject to state and local taxation and unitholders should consult
their tax advisers in this regard.
PERFORMANCE INFORMATION
Information contained in this Information Supplement or in the prospectus, as
it currently exists or as further updated, may also be included from time to
time in other prospectuses or in advertising material. Information on the
performance of a trust strategy or the actual performance of a trust may be
included from time to time in other prospectuses or advertising material and may
reflect sales charges and expenses of a trust. The performance of a trust may
also be compared to the performance of money managers as reported in SEI Fund
Evaluation Survey or of mutual funds as reported by Lipper Analytical Services
Inc. (which calculates total return using actual dividends on ex-dates
accumulated for the quarter and reinvested at quarter end), Money Magazine Fund
Watch (which rates fund performance over a specified time period after sales
charge and assuming all dividends reinvested) or Wiesenberger Investment
Companies Service (which states fund performance annually on a total return
basis) or of the New York Stock Exchange Composite Index, the American Stock
Exchange Index (unmanaged indices of stocks traded on the New York and American
Stock Exchanges, respectively), the Dow Jones Industrial Average (an index of 30
widely traded industrial common stocks) or the Standard & Poor's 500 Index (an
unmanaged diversified index of 500 stocks) or similar measurement standards
during the same period of time.
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CONTENTS OF REGISTRATION STATEMENT
This Registration Statement comprises the following papers and documents.
The facing sheet
The Prospectus
The Signatures
The following exhibits.
1.1. Trust Agreement.
1.1.1. Standard Terms and Conditions of Trust. Reference is made to Exhibit
1.1.1 to the Registration Statement Form S-6 for Ranson Unit Investment
Trust, Series 53 (File No. 333-17811) as filed on January 7, 1997.
2.2. Form of Code of Ethics. Reference is made to Exhibit 2.2 to the
Registration statement on Form S-6 for Ranson Unit Investment Trusts,
Series 92 (File No. 333-31782) as filed on March 14, 2000.
2.1. Form of Certificate of Ownership (pages three and four of the Standard
Terms and Conditions of Trust included as Exhibit 1.1.1).
3.1. Opinion of counsel to the Sponsor as to legality of the securities being
registered including a consent to the use of its name under "Legal
Opinions" in the Prospectus.
4.1. Consent of Independent Auditors.
S-1
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SIGNATURES
The Registrant, Ranson Unit Investment Trusts, Series 99 hereby identifies
Ranson Unit Investment Trusts, Series 53 and Series 90, EVEREN Unit Investment
Trusts, Series 39, Kemper Defined Funds, Series 45 and Kemper Equity Portfolio
Trusts, Series 1 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,
Ranson Unit Investment Trusts, Series 99 has duly caused this Registration
Statement to be signed on its behalf by the undersigned thereunto duly
authorized, in the City of Wichita, and State of Kansas, on the 2nd day of
November, 2000.
RANSON UNIT INVESTMENT TRUSTS, SERIES 99,
Registrant
By: RANSON & ASSOCIATES, INC.,
Depositor
By: /s/ ALEX R. MEITZNER
---------------------------------------
Alex R. Meitzner
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below on November 2, 2000 by the following persons,
who constitute a majority of the Board of Directors of Ranson & Associates, Inc.
SIGNATURE TITLE
---------------------- -----------------------
/s/ DOUGLAS K. ROGERS Executive Vice )
---------------------- President and Director )
Douglas K. Rogers
/s/ ALEX R. MEITZNER Chairman of the Board )
---------------------- of Directors )
Alex R. Meitzner
/s/ ROBIN K. PINKERTON President, Secretary, )
---------------------- Treasurer and Director ) /s/ ALEX R. MEITZNER
Robin K. Pinkerton -----------------------
Alex R. Meitzner
-------------------------------------------------------------------------------
An executed copy of each of the related powers of attorney was filed with the
Securities and Exchange Commission in connection with the Registration Statement
on Form S-6 of The Kansas Tax-Exempt Trust, Series 51 (File No. 33-46376) and
Series 52 (File No. 33-47687) and the same are hereby incorporated herein by
this reference.
S-2
