File No. 33-56012 CIK #910699
Securities and Exchange CommissionWashington, D. C. 20549
Post-Effective
Amendment No. 2
to
Form S-6
For Registration under the Securities Act of 1933
of Securities of Unit Investment Trusts Registered
on Form N-8B-2
Kemper Defined Funds Series 9
Name and executive office address of Depositor:
EVEREN Unit Investment Trusts
(a division of EVEREN Securities, Inc.)
77 West Wacker - 29th Floor
Chicago, Illinois 60601
Name and complete address of agent for service:
Robert K. Burke
77 West Wacker - 29th Floor
Chicago, Illinois 60601
( X ) Check box if it is proposed that this filing will
become effective at 2:00 p.m. on April 29, 1996 pursuant to
paragraph (b) of Rule 485.
KEMPER DEFINED FUNDSCORPORATE INCOME SERIESANDINVESTMENT GRADE
CORPORATE INCOME SERIES
Kemper Defined Funds Corporate Income Series ("Corporate Income
Series") was formed for the purpose of providing a high level of
current income through investment in a fixed portfolio consisting
primarily of high yield, high risk corporate debt obligations
issued after July 18, 1984. Certain Series of the Trust may also
contain high yield, high risk dollar denominated foreign
corporate debt obligations if interest thereon is U.S. source
income, sovereign debt obligations or zero coupon U.S. Treasury
obligations.
Kemper Defined Funds Investment Grade Corporate Income Series
(the "Investment Grade Series") was formed for the purpose of
providing a high level of current income through investment in a
fixed portfolio consisting primarily of investment grade,
corporate debt obligations issued after July 18, 1984. The
payment of income is dependent upon the continuing ability of the
issuers and/or obligors to meet their respective obligations.
See "Trust Portfolio _ Risk Factors."
Most of the securities included in the Corporate Income Series
only are commonly known as "junk bonds" and are subject to
greater market fluctuations and potential risk of loss of income
and principal than are investments in lower-yielding, higher
rated fixed income securities. The securities included in each
such Trust should be viewed as speculative and an investor should
review his ability to assume the risks associated with
speculative corporate bonds. The payment of income is dependent
upon the continuing ability of the issuers and/or obligors to
meet their respective obligations. See "Trust Portfolio_Risk
Factors."
Units of the Trusts are not deposits of, or guaranteed by, any
bank, and Units are not federally insured or otherwise protected
by the Federal Deposit Insurance Corporation and involve
investment risk including loss of principal.
For foreign investors who are not United States citizens or
residents, interest income from a Trust may not be subject to
federal withholding taxes if certain conditions are met. See
"Federal Tax Status."
SPONSOR: EVEREN UNIT INVESTMENT TRUSTSa service of EVEREN
Securities, Inc.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
This Prospectus is in two parts. The investor is advised to read
and retain both parts of this Prospectus for future reference.
The date of this Part One Prospectusis that date which is set
forth in Part Two of the Prospectus.
SUMMARY
Public Offering Price. The Public Offering Price per Unit will
be based upon a pro rata share of the bid prices of the Bonds in
a Trust plus or minus a pro rata share of (a) cash, if any, in
the Principal Account held or owned by such Trust, Purchased
Interest, if any, accrued interest (or Daily Accrued Interest)
plus the applicable sales charge. For sales charges, see "Public
Offering of Units_Public Offering Price." The sales charge is
reduced on a graduated scale as set forth under "Public Offering
of Units_Public Offering Price."
Interest and Principal Distributions. Distributions of the
estimated annual interest income to be received by a Trust, after
deduction of estimated expenses, will be made monthly. See
"Unitholders_Distributions to Unitholders" and "Essential
Information" in Part Two of this Prospectus Distributions of
funds, if any, in the Principal Account will be made as provided
in "Unitholders_Distributions to Unitholders."
Reinvestment. Each Unitholder may elect to have distributions of
principal or interest or both automatically invested without
charge in shares of certain Kemper Financial Services, Inc.
mutual funds. See "Distribution Reinvestment."
Estimated Long-Term Return and Estimated Current Return. The
Estimated Current Return is calculated by dividing the estimated
net annual interest income per Unit by the Public Offering Price.
The estimated net annual interest income per Unit will vary with
changes in fees and expenses of the Trustee, Sponsor and
Evaluator and with the principal prepayment, redemption,
maturity, exchange or sale of Bonds while the Public Offering
Price will vary with changes in the offering price of the
underlying Bonds and with changes in the Purchased Interest, if
any, and accrued interest (or Daily Accrued Interest); therefore,
there is no assurance that the present Estimated Current Returns
will be realized in the future. The Estimated Long-Term Return
is calculated using a formula which (1) takes into consideration,
and determines and factors in the relative weightings of, the
market values, yields (which take into account the amortization
of premiums and the accretion of discounts) and estimated
retirement dates of all of the Bonds in a Trust and (2) takes
into account the expenses and sales charge associated with each
Unit. Since the market values and estimated retirement dates of
the Bonds and the expenses of the Trust will change, there is no
assurance that the present Estimated Long-Term Return will be
realized in the future. The Estimated Current Return and
Estimated Long-Term Return are expected to differ because the
calculation of Estimated Long-Term Return reflects the estimated
date and amount of principal returned while Estimated Current
Return calculations include only net annual interest income and
Public Offering Price.
Market for Units. While under no obligation to do so, the Sponsor
intends to maintain a market for the Units and to offer
to repurchase such Units at prices subject to change at any time
which are based on the aggregate bid side evaluation of the Bonds
in a Trust Fund plus Purchased Interest, if any, and accrued
interest (or Daily Accrued Interest).
Risk Factors. Each Corporate Income Series Trust is comprised
primarily of securities rated below investment grade by Standard
& Poor's, Moody's Investors Service, Inc. or Duff & Phelps Credit
Rating Co., which securities are commonly referred to as "junk
bonds." In addition, certain of the securities in certain of the
Trusts may be obligations of foreign issuers. For special risks
associated with the Trusts, see "Trust Portfolios _ Risk
Factors."
THE TRUST FUNDS
Each Series of the Trust is a unit investment trust created by
the Sponsor under the name Kemper Defined Funds Corporate Income
Series or Kemper Defined Funds Investment Grade Corporate Income
Series (the "Trusts" or "Trust Funds," and each a "Trust"), all
of which are similar, and each of which was created under the
laws of the State of Missouri pursuant to a trust indenture (the
"Trust Agreement"). EVEREN Unit Investment Trusts, a service of
EVEREN Securities, Inc. acts as sponsor of the Trusts (the
"Sponsor") and The Bank of New York acts as trustee of the Trusts
(the "Trustee").*
Each Corporate Income Series was formed for the purpose of
providing a high level of current income through investment in a
fixed portfolio consisting primarily of high yield, high risk
corporate debt obligations issued after July 18, 1984. Certain
Series of the Trusts may also contain high yield, high risk
dollar denominated foreign corporate debt obligations, sovereign
debt obligations or zero coupon U.S. Treasury obligations
(collectively, the "Obligations" or "Bonds"). There is, of
course, no guarantee that a Trust Fund's objective will be
achieved.
Each Investment Grade Series was formed for the purpose of
providing a high level of current income through investment in a
fixed portfolio consisting primarily of investment grade,
corporate debt obligations issued after July 18, 1984 There is,
of course, no guarantee that the Trust Funds' objectives will be
achieved.
A Trust Fund may be an appropriate investment vehicle for
investors who desire to participate in a portfolio of taxable
fixed income securities issued primarily by corporate obligors
with greater diversification than investors might be able to
acquire individually. Diversification of the Trust assets will
not eliminate the risk of loss always inherent in the ownership
of securities. In addition, Bonds of the type deposited in the
Trust Funds often are not available in small amounts.
Each Unit offered represents that undivided interest in the Trust
involved as indicated under "Essential Information" in Part Two
of this Prospectus. To the extent that any Units are redeemed by
the Trustee, the fractional undivided interest in such Trust
represented by each unredeemed Unit will increase or decrease
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* Reference is made to the Trust Agreement for each Trust, and
any statements contained herein are qualified in their entirety
by the provisions of the appropriate Trust Agreement.
accordingly, although the actual interest in such Trust
represented by such fraction will remain unchanged. Units will
remain outstanding until redeemed upon tender to the Trustee by
Unitholders, which may include the Sponsor, or until the
termination of the Trust Agreement.
An investment in Units should be made with an understanding of
the risks which an investment in fixed rate debt obligations may
entail, including the risk that the value of the portfolio and
hence of the Units will decline with increases in interest rates.
The value of the underlying Bonds will fluctuate inversely with
changes in interest rates. The uncertain economic conditions of
recent years, together with the fiscal measures adopted to
attempt to deal with them, have resulted in wide fluctuations in
interest rates and, thus, in the value of fixed rate debt
obligations generally. The Sponsor cannot predict the degree to
which such fluctuations will continue in the future. Each Trust
is comprised primarily of securities rated below investment grade
by Standard & Poor's, Moody's Investor Service, Inc., or Duff &
Phelps Credit Rating Co., which securities are commonly referred
to as "junk bonds." For special risks associated with such
securities, see "Trust Portfolio_Risk Factors."
COMPENSATION FOR FOREIGN WITHHOLDING TAX
Certain of the Bonds in certain Series of the Trusts are subject
to non-U.S. ("foreign") withholding taxes. Certain issuers of
Bonds which are subject to foreign withholding taxes have
generally agreed, subject to certain exceptions, to make
additional payments ("Additional Payments") which together with
other payments are intended to compensate the holder of the Bond
for the imposition of certain withholding taxes. However, both
the calculation of the Additional Payment and whether the
Additional Payment compensates the holder of the Bond for any
related penalties, interest or other charges imposed in
connection with any applicable foreign withholding taxes are
likely to differ from Bond to Bond. Moreover, the Additional
Payment is itself treated as taxable income to Unitholders for
U.S. income tax purposes. The Additional Payment may not be
based upon a "gross-up" formula which would otherwise compensate
an investor for the tax liability triggered by the receipt of the
Additional Payment. For any of these reasons, an investor may
not be adequately compensated for the actual foreign withholding
tax liabilities incurred. If a Trust obtains a certificate from
an issuer evidencing payment of foreign withholding taxes with
respect to a Bond, the Trust will so notify Unitholders. A
Unitholder is required to include in his gross income the entire
amount of interest paid on his pro rata portion of the Bond
including the amount of tax withheld therefrom and the amount of
any Additional Payment. However, if the foreign tax withheld
constitutes an income tax for which U.S. foreign tax credits may
be taken, the Unitholder may be able to obtain applicable foreign
tax credits (subject to statutory limitations) or deductions.
See "Federal Tax Status."
FEDERAL TAX STATUS
In the opinion of Chapman and Cutler, special counsel for the
Sponsor, under existing law:
1. Each Series of the Trust is not an association taxable
as a corporation for Federal income tax purposes.
2. Each Unitholder will be considered the owner of a pro
rata portion of each of a Trust's assets for Federal income tax
purposes under Subpart E, Subchapter J of Chapter 1 of the
Internal Revenue Code of 1986 (the "Code"); and the income will
be treated as income of the Unitholders. Each Unitholder will be
considered to have received his pro rata share of income derived
from each Trust asset when such income is received by a Trust.
Each Unitholder will also be required to include in taxable
income for Federal income tax purposes, original issue discount
with respect to his interest in any Bonds held by a Trust at the
same time and in the same manner as though the Unitholder were
the direct owner of such interest.
3. Each Unitholder will have a taxable event when a Bond
is disposed of (whether by sale, exchange, liquidation,
redemption, or payment at maturity) or when the Unitholder
redeems or sells his Units. A Unitholder's tax basis in his
Units will equal his tax basis in his pro rata portion of all the
assets of the Trust. Such basis is determined (before the
adjustments described below) by apportioning the tax basis for
the Units among each of the Trust assets according to value as of
the valuation date nearest the date of acquisition of the Units.
Unitholders must reduce the tax basis of their Units for their
share of accrued interest received, if any, on Bonds delivered
after the date the Unitholders pay for their Units to the extent
such interest accrued on such Bonds during the period from the
Unitholder's settlement date to the date such Bonds are delivered
to the Trust, and, consequently, such Unitholders may have an
increase in taxable gain or reduction in capital loss upon the
disposition of such Units. Gain or loss upon the sale or
redemption of Units is measured by comparing the proceeds of such
sale or redemption with the adjusted basis of the Units. If the
Trustee disposes of Bonds, gain or loss is recognized to the
Unitholder (subject to various nonrecognition provisions of the
Code). The amount of any such gain or loss is measured by
comparing the Unitholders pro rata share of the total proceeds
from such disposition with his basis for his fractional interest
in the asset disposed of. The basis of each Unit and of each
Bond which was issued with original issue discount (or which has
market discount) (including any U.S. Treasury obligations) must
be increased by the amount of accrued original issue discount
(and accrued market discount if the Unitholder elects to include
market discount in income as it accrues) and the basis of each
Unit and of each Bond which was purchased by a Trust at a premium
must be reduced by the annual amortization of bond premium which
the Unitholder has properly elected to amortize under Section 171
of the Code. The tax basis reduction requirements of the Code
relating to amortization of bond premium may, under some
circumstances, result in the Unitholder realizing a taxable gain
when his Units are sold or redeemed for an amount equal to or
less than his original cost. The U.S. Treasury obligations held
by a Trust, if any, are treated as bonds that were originally
issued at an original issue discount provided, pursuant to a
Treasury Regulation (the "Regulation") issued on December 28,
1992, that the amount of original issue discount determined under
Section 1286 of the Code is not less than a "de minimis" amount
as determined thereunder (as discussed below under "Original
Issue Discount"). Because U.S. Treasury obligations represent
interests in "stripped" U.S. Treasury bonds, a Unitholder's
initial cost for his pro rata portion of each U.S. Treasury
obligation held by a Trust (determined at the time he acquires
his Units, in the manner described above) shall be treated as its
"purchase price" by the Unitholder. Original issue discount is
effectively treated as interest for Federal income tax purposes,
and the amount of original issue discount in this case is
generally the difference between the Bond's purchase price and
its stated redemption price at maturity. A Unitholder will be
required to include in gross income for each taxable year the sum
of his daily portions of original issue discount attributable to
the Bonds held by a Trust as such original issue discount accrues
and will, in general, be subject to Federal income tax with
respect to the total amount of such original issue discount that
accrues for such year even though the income is not distributed
to the Unitholders during such year to the extent it is not less
than a "de minimis" amount as determined under the Regulation.
In general, original issue discount accrues daily under a
constant interest rate method which takes into account the
semi-annual compounding of accrued interest. In the case of U.S
Treasury obligations, this method will generally result in an
increasing amount of income to the Unitholders each year.
Unitholders should consult their tax advisers regarding the
Federal income tax consequences and accretion of original issue
discount.
Limitations on Deductibility of Trust Expenses by Unitholders.
Each Unitholder's pro rata share of each expense paid by a Trust
is deductible by the Unitholder to the same extent as though the
expense had been paid directly by him. It should be noted that
as a result of the Tax Reform Act of 1986 (the "Act"), certain
miscellaneous itemized deductions, such as investment expenses,
tax return preparation fees and employee business expenses will
be deductible by an individual only to the extent they exceed 2%
of such individual's adjusted gross income. Unitholders may be
required to treat some or all expenses paid by a Trust as
miscellaneous itemized deductions subject to this limitation.
Premium. If a Unitholder's tax basis of his pro rata portion in
any Bonds held by a Trust exceeds the amount payable by the
issuer of the Bond with respect to such pro rata interest upon
the maturity of the Bond, such excess would be considered premium
which may be amortized by the Unitholder at the Unitholder's
election as provided in Section 171 of the Code. Unitholders
should consult their tax advisors regarding whether such election
should be made and the manner of amortizing premium.
Original Issue Discount. Certain of the Bonds in each Trust may
have been acquired with "original issue discount." In the case
of any Bonds in a Trust acquired with "original issue discount"
that exceeds a "de minimis" amount as specified in the Code, such
discount is includable in taxable income of the Unitholders on an
accrual basis computed daily, without regard to when payments of
interest on such Bonds are received. The Code provides a complex
set of rules regarding the accrual of original issue discount.
These rules provide that original issue discount generally
accrues on the basis of a constant compound interest rate over
the term of the Bonds. Unitholders should consult their tax
advisers as in the amount of original issue discount which
accrues.
Special original issue discount rules apply if the purchase price
of the Bond by a Trust exceeds its original issue price plus the
amount of original issue discount which would have previously
accrued based upon its issue price (its "adjusted issue price").
Similarly these special rules would apply to a Unitholder if the
tax basis of his pro rata portion of a Bond issued with original
issue discount exceeds his pro rata portion of its adjusted issue
price. Unitholders should also consult their tax advisers
regarding these special rules.
It is possible that a corporate Bond that has been issued at an
original issue discount may be characterized as a "high-yield
discount obligation" within the meaning of Section 163(e)(5) of
the Code. To the extent that such an obligation is issued at a
yield in excess of six percentage points over the applicable
Federal rate, a portion of the original issue discount on such
obligation will be characterized as a distribution on stock
(e.g., dividends) for purposes of the dividends received
deduction which is available to certain corporations with respect
to certain dividends received by such corporation.
Market Discount. If a Unitholder's tax basis in his pro rata
portion of Bonds is less than the allocable portion of such
Bond's stated redemption price at maturity (or, if issued with
original issue discount, the allocable portion of its "revised
issue price"), such difference will constitute market discount
unless the amount of market discount is "de minimis" as specified
in the Code. Market discount accrues daily computed on a
straight line basis, unless the Unitholder elects to calculate
accrued market discount under a constant yield method.
Unitholders should consult their tax advisors as to the amount of
market discount which accrues.
Accrued market discount is generally includable in taxable income
to the Unitholders as ordinary income for Federal tax purposes
upon the receipt of serial principal payments on the Bonds, on
the sale, maturity or disposition of such Bonds by a Trust, and
on the sale by a Unitholder of Units, unless a Unitholder elects
to include the accrued market discount in taxable income as such
discount accrues. If a Unitholder does not elect to annually
include accrued market discount in taxable income as it accrues,
deductions for any interest expense incurred by the Unitholder
which is incurred to purchase or carry his Units will be reduced
by such accrued market discount. In general, the portion of any
interest expense which was not currently deductible would ultimately
be deductible when the accrued market discount is
included in income. Unitholders should consult their tax
advisers regarding whether an election should be made to include
market discount in income as it accrues and as to the amount of
interest expense which may not be currently deductible.
Computation of the Unitholder's Tax Basis. The tax basis of a
Unitholder with respect to his interest in a Bond is increased by
the amount of original issue discount (and market discount, if
the Unitholder elects to include market discount, if any, on the
Bonds held by a Trust in income as it accrues) thereon properly
included in the Unitholder's gross income as determined for
Federal income tax purposes and reduced by the amount of any
amortized acquisition premium which the Unitholder has properly
elected to amortize under Section 171 of the Code. A
Unitholder's tax basis in his Units will equal his tax basis in
his pro rata portion of all of the assets of the Trust.
Recognition of Taxable Gain or Loss upon Disposition of
Obligations by a Trust or Disposition of Units. A Unitholder
will recognize taxable capital gain (or loss) when all or part of
his pro rata interest in a Bond is disposed of in a taxable
transaction for an amount greater (or less) than his tax basis
therefor. As previously discussed, gain realized on the
disposition of the interest of a Unitholder in any Bond deemed to
have been acquired with market discount will be treated as
ordinary income to the extent the gain does not exceed the amount
of accrued market discount not previously taken into income. Any
capital gain or loss arising from the disposition of a Bond by a
Trust or the disposition of Units by a Unitholder will be
short-term capital gain or loss unless the Unitholder has held
his Units for more than one year in which case such capital gain
or loss will be generally long-term. For taxpayers other than
corporations, net capital gains are subject to a maximum marginal
stated tax rate of 28 percent. However, it should be noted that
legislative proposals are introduced from time to time that
affect tax rates and could affect relative differences at which
ordinary income and capital gains are taxed. The tax basis
reduction requirements of the Code relating to amortization of
bond premium may under some circumstances, result in the
Unitholder realizing taxable gain when his Units are sold or
redeemed for an amount equal to or less than his original cost.
If the Unitholder disposes of a Unit, he is deemed thereby to
have disposed of his entire pro rata interest in all Trust assets
including his pro rata portion of all of the Bonds represented by
the Unit. This may result in a portion of the gain, if any, on
such sale being taxable as ordinary income under the market
discount rules (assuming no election was made by the Unitholder
to include market discount in income as it accrues) as previously
discussed.
"The Revenue Reconciliation Act of 1993" (the "Tax Act") raised
tax rates on ordinary income while capital gains remain subject
to a 28 percent maximum stated rate. Because some or all capital
gains are taxed at a comparatively lower rate under the Tax Act,
the Tax Act includes a provision that recharacterizes capital
gains as ordinary income in the case of certain financial transactions
that are "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.
Foreign Investors. A Unitholder who is a foreign investor (i.e.,
an investor other than a U.S. citizen or resident or a U.S.
corporation, partnership, estate or trust) will generally not be
subject to United States federal income taxes, including
withholding taxes, on interest income (including any original
issue discount) on, or any gain from the sale or other
disposition of, his pro rata interest in any Bond or the sale of
his Units provided that all of the following conditions are met:
(i) the interest income or gain is not effectively connected with
the conduct by the foreign investor of a trade or business within
the United States, (ii) either the interest is United States
source income (which is the case for most securities issued by
United States issuers), the Bond is issued after July 18, 1984
(which is the case for each Bond held by a Trust), the foreign
investor does not own, directly or indirectly, 10% or more of the
total combined voting power of all classes of voting stock of the
issuer of the Bond and the foreign investor is not a controlled
foreign corporation related (within the meaning of Section
864(d)(4) of the Code) to the issuer of the Bond, or the interest
income is not from sources within the United States, (iii) with
respect to any gain, 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 (iv) the foreign investor provides all
certification which may be required of his status. Foreign
investors should consult their tax advisers with respect to
United States tax consequences of ownership of Units. On
December 7, 1995, the U.S. Treasury Department released proposed
legislation that, if adopted, could affect the United States
federal income taxation of such non-United States Unitholders and
the portion of the Trust's income allocable to non-United States
Unitholders.
It should be noted that the Tax Act includes a provision which
eliminates the exemption from United States taxation, including
withholding taxes, for certain "contingent interest." The
provision applies to interest received after December 31, 1993.
No opinion is expressed herein regarding the potential
applicability of this provision and whether United States
taxation or withholding taxes could be imposed with respect to
income derived from the Units as a result thereof. Unitholders
and prospective investors should consult with their tax advisers
regarding the potential effect of this provision on their
investment in Units.
General. Each Unitholder (other than a foreign investor who has
properly provided the certifications described in the preceding
paragraph) will be requested to provide the Unitholder's taxpayer
identification number to the Trustee and to certify that the
Unitholder has not been notified that payments to the Unitholder
are subject to back-up withholding. If the proper taxpayer
identification number and appropriate certification are not
provided when requested, distributions by a Trust to such
Unitholder will be subject to back-up withholding.
The foregoing discussion relates only to United States Federal
income taxes; Unitholders may be subject to state and local
taxation in other jurisdictions (including a foreign investor's
country of residence). Unitholders should consult their tax
advisers regarding potential state, local, or foreign taxation
with respect to the Units.
TAX REPORTING AND REALLOCATION
Because the Trusts receive interest and makes monthly
distributions based upon a Trust's expected total collections of
interest and any anticipated expenses, certain tax reporting
consequences may arise. A Trust is required to report Unitholder
information to the Internal Revenue Service ("IRS"), based upon
the actual collection of interest by such Trust on the securities
in such Trust, without regard to such Trust's expenses or to such
Trust's payments to Unitholders during the year. If
distributions to Unitholders exceed interest collected, the
difference will be reported as a return of principal which will
reduce a Unitholder's cost basis in its Units (and its pro rata
interest in the securities in a Trust). A Unitholder must
include in taxable income the amount of income reported by a
Trust to the IRS regardless of the amount distributed to such
Unitholder. If a Unitholder's share of taxable income exceeds
income distributions made by a trust to such Unitholder, such
excess is in all likelihood attributable to the payment of
miscellaneous expenses of such Trust which will not be deductible
by an individual Unitholder as an itemized deduction except to
the extent that the total amount of certain itemized deductions,
such as investments expenses (which would include the
Unitholder's share of Trust expenses), tax return preparation
fees and employee business expenses, exceeds 2% of such
Unitholders's adjusted gross income. Alternatively, in certain
cases, such excess may represent an increase in the Unitholder's
tax basis in the Units owned. Investors with questions regarding
these issues should consult with their tax advisers.
TRUST PORTFOLIOS
PORTFOLIO SELECTION
The selection of Bonds for each Series of a Trust was based
largely upon the experience and judgment of the Sponsor. In
making such selections the Sponsor considered the following
factors: (a) the price of the Bonds relative to other issues of
similar quality and maturity; (b) the present rating and credit
quality of the issuers of the Bonds and the potential improvement
in the credit quality of such issuers; (c) the diversification of
the Bonds as to location of issuer; (d) the income to the
Unitholders of a Trust; (e) whether the Bonds were issued after
July 18, 1984; and (f) the stated maturity of the Bonds.
As of the Initial Date of Deposit for each Series, all of the
Bonds in a Corporate Income Series Trust were rated "Ba" or
better by Moody's Investors Service, Inc. or "BB" or better by
Standard & Poor's or Duff & Phelps Credit Rating Co. As of the
Initial Date of Deposit, all of the Bonds in an Investment Grade
Series were rated "Baa" or better by Moody's or "BBB" or better by
Standard & Poor's or Duff & Phelps Credit Rating Co. See
"Description of Ratings" herein and "Schedule of Investments" in
Part Two of this Prospectus. Subsequent to the Initial Date of
Deposit, a Bond may cease to be so rated. If this should occur,
a Trust would not be required to eliminate the Bond from the
Trust, but such event may be considered in the Sponsor's
determination to direct the Trustee to dispose of such
investment. See "Investment Supervision."
RISK FACTORS
General. An investment in Units of a Trust should be made with
an understanding of the risks that an investment in "high yield,"
high risk, fixed rate, foreign and domestic corporate debt
obligations or "junk bonds" may entail, including increased
credit risks and the risk that the value of the Units will
decline, and may decline precipitously, with increases in
interest rates. While the Bonds in an Investment Grade Series
are higher rated and generally thought to be less risky than
lower rated bonds, such Bonds are generally susceptible to the
risks described herein. In recent years there have been wide
fluctuations in interest rates and thus in the value of
fixed-rate, debt obligations generally. Securities such as those
included in each Trust are, under most circumstances, subject to
greater market fluctuations and risk of loss of income and
principal than are investments in lower-yielding, higher rated
securities, and their value may decline precipitously because of
increases in interest rates not only because the increases in
rates generally decrease values but also because increased rates
may indicate a slowdown in the economy and a decrease in the
value of assets generally that may adversely affect the credit of
issuers of high yield, high risk securities resulting in a higher
incidence of defaults among high yield, high risk securities. A
slowdown in the economy, or a development adversely affecting an
issuer's creditworthiness, may result in the issuer being unable
to maintain earnings or sell assets at the rate and at the
prices, respectively, that are required to produce sufficient
cash flow to meet its interest and principal requirements. For
an issuer that has outstanding both senior commercial bank debt
and subordinated high yield, high risk securities, an increase in
interest rates will increase that issuer's interest expense
insofar as the interest rate on the bank debt is fluctuating.
However, many leveraged issuers enter into interest rate
protection agreements to fix or cap the interest rate on a large
portion of their bank debt. This reduces exposure to increasing
rates but reduces the benefit to the issuer of declining rates.
The Sponsor cannot predict future economic policies or their
consequences or, therefore, the course or extent of any similar
market fluctuations in the future. The portfolios consist of
Obligations that, in many cases, do not have the benefit of
covenants that would prevent the issuer from engaging in capital
restructurings or borrowing transactions in connection with
corporate acquisitions, leveraged buy outs or restructurings that
could have the effect of reducing the ability of the issuer to
meet its obligations and might result in the ratings of the
Obligations and the value of the underlying portfolio being reduced.
The Obligations in each Trust consist of "high yield, high risk"
foreign and domestic corporate bonds and foreign sovereign debt
obligations. "High yield" or "junk" bonds, the generic names for
corporate bonds rated below BBB by Standard & Poor's or Duff &
Phelps Credit Rating Co. or below Baa by Moody's Investor
Service, Inc., are frequently issued by corporations in the
growth stage of their development, by established companies whose
operations or industries are depressed or by highly leveraged
companies purchased in leveraged buyout transactions. The market
for high yield bonds is very specialized and investors in it have
been predominantly financial institutions. High yield bonds are
generally not listed on a national securities exchange. Trading
of high yield bonds, therefore, takes place primarily in
over-the-counter markets which consist of groups of dealer firms
that are typically major securities firms. Because the high
yield bond market is a dealer market, rather than an auction
market, no single obtainable price for a given bond prevails at
any given time. Prices are determined by negotiation between
traders. The existence of a liquid trading market for the
Obligations may depend on whether dealers will make a market in
the Obligations. There can be no assurance that a market will be
made for any of the Obligations, that any market for the
Obligations will be maintained or of the liquidity of the
Obligations in any markets made. Not all dealers maintain
markets in all high yield bonds. Therefore, since there are
fewer traders in these bonds than there are in "investment grade"
bonds, the bid-offer spread is usually greater for high yield
bonds than it is for investment grade bonds. 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
Obligations are limited or absent. If the rate of redemptions is
great, the value of a Trust may decline to a level that requires
liquidation (see "Administration of the Trusts_Amendment and
Termination").
Lower-rated securities tend to offer higher yields than
higher-rated securities with the same maturities because the
creditworthiness of the issuers of lower-rated securities may not
be as strong as that of other issuers. Moreover, if an
Obligation is recharacterized as equity by the internal Revenue
Service for Federal income tax purposes, the issuer's interest
deduction with respect to the Obligation will be disallowed and
this disallowance may adversely affect the issuer's credit
rating. Because investors generally perceive that there are
greater risks associated with the lower-rated securities in a
Trust, the yields and prices of these securities tend to
fluctuate more than higher-rated securities with changes in the
perceived quality of the credit of their issuers. In addition,
the market value of high yield, high risk, fixed-income
securities may fluctuate more than the market value of
higher-rated securities since high yield, high risk, fixed-income
securities tend to reflect short-term credit development to a
greater extent than higher-rated securities. Lower-rated
securities generally involve greater risks of loss of income and
principal than higher-rated securities. Issuers of lower-rated
securities may possess less creditworthiness characteristics than
issuers of higher-rated securities and, especially in the case of
issuers whose obligations or credit standing have recently been
downgraded, may be subject to claims by debtholders, owners of
property leased to the issuer or others which, if sustained,
would make it more difficult for the issuers to meet their
payment obligations. High yield, high risk bonds are also
affected by variables such as interest rates, inflation rates and
real growth in the economy. Therefore, investors should consider
carefully the relative risks associated with investment in
securities which carry lower ratings.
The value of the Units reflects the value of the portfolio
securities, including the value (if any) of securities in
default. Should the issuer of any Obligation default in the
payment of principal or interest, a Trust may incur additional
expenses seeking payment on the defaulted Obligation. Because
amounts (if any) recovered by a Trust in payment under the
defaulted Obligation may not be reflected in the value of the
Units until actually received by the Trust, and depending upon
when a Unitholder purchases or sells his Units, it is possible
that a Unitholder would bear a portion of the cost of recovery
without receiving any portion of the payment recovered.
High yield, high risk bonds are generally subordinated
obligations. The payment of principal (and premium, if any),
interest and sinking fund requirements with respect to
subordinated obligations of an issuer is subordinated in right of
payment to the payment of senior obligations of the issuer.
Senior obligations generally include most, if not all,
significant debt obligations of an issuer, whether existing at
the time of issuance of subordinated debt or created thereafter.
Upon any distribution of the assets of an issuer with
subordinated obligations upon dissolution, total or partial
liquidation or reorganization of or similar proceeding relating
to the issuer, the holders of senior indebtedness will be
entitled to receive payment in full before holders of
subordinated indebtedness will be entitled to receive any
payment. Moreover, generally no payment with respect to
subordinated indebtedness may be made while there exists a
default with respect to any senior indebtedness. Thus, in the
event of insolvency, holders of senior indebtedness of an issuer
generally will recover more, ratably, than holders of
subordinated indebtedness of that issuer.
Obligations that are rated lower than BBB by Standard & Poor's or
Duff & Phelps or Baa by Moody's, respectively, should be
considered speculative as such ratings indicate a quality of less
than investment grade. Investors should carefully review the
objective of the Trust and consider their ability to assume the
risks involved before making an investment in the Trust. See
"Description of Ratings" for a description of speculative ratings
issued by Standard & Poor's, Duff & Phelps and Moody's.
Zero Coupon U.S. Treasury Obligations. Certain of the Bonds in a
Trust may be "zero coupon" U.S. Treasury bonds. See Part Two of
this Prospectus. Zero coupon bonds are purchased at a deep discount
because the buyer receives only the right to receive a
final payment at the maturity of the bond and does not receive
any periodic interest payments. The effect of owning deep
discount bonds which do not make current interest payments (such
as the zero coupon bonds) is that a fixed yield is earned not
only on the original investment but also, in effect, on all
discount earned during the life of such income on such obligation
at a rate as high as the implicit yield on the discount
obligation, but at the same time eliminates the holder's ability
to reinvest at higher rates in the future. For this reason, zero
coupon bonds are subject to substantially greater price
fluctuations during periods of changing market interest rates
than are securities of comparable quality which pay interest.
Foreign Issuers. Certain of the Bonds in a Trust may be
securities of foreign issuers. It is appropriate for investors
in such a Trust to consider certain investment risks that
distinguish investments in Bonds of foreign issuers from those of
domestic issuers. Those investment risks include future
political and economic developments, the possible imposition of
withholding taxes on interest income payable on the Bonds held in
a portfolio, the possible seizure or nationalization of foreign
deposits, the possible establishment of exchange controls or the
adoption of other foreign governmental restrictions (including
expropriation, burdensome or confiscatory taxation and
moratoriums) which might adversely affect the payment or receipt
of payment of amounts due on the Bonds. Investors should realize
that, although a Trust invests in U.S. dollar denominated
investments, the foreign issuers which operate internationally
are subject to currency risks. The value of Bonds can be
adversely affected by political or social instability and
unfavorable diplomatic or other negative developments. In
addition, because many foreign issuers are not subject to the
reporting requirements of the Securities Exchange Act of 1934,
there may, be less publicly available information about the
foreign issuer than a U.S. domestic issuer. Foreign issuers also
are not necessarily subject to uniform accounting, auditing and
financial reporting standards, practices and requirements
comparable to those applicable to U.S. domestic issuers.
Liquidity. The Bonds in a Trust may not have been registered
under the Securities Act of 1933 and may not be exempt from the
registration requirements of the Act. Most of the Bonds will not
be listed on a securities exchange. Whether or not the Bonds are
listed, the principal trading market for the Bonds will generally
be in the over-the-counter market. As a result, the existence of
a liquid trading market for the Bonds may depend on whether
dealers will make a market in the Bonds. There can be no
assurance that a market will be made for any of the Bonds, that
any market for the Bonds will be maintained, or of the liquidity
of the Bonds in any markets made. The price at which the Bonds
may be sold to meet redemptions and the value of a Trust will be
adversely affected if trading markets for the Bonds are limited
or absent. A Trust may also contain nonexempt Bonds in
registered form which have been purchased on a private placement
basis. Sales of these Bonds may not be practicable outside the
United States, but can generally be made in U.S. institutions in
the private placement market which may not be as liquid as the
general U.S. securities market. Since the private placement
market is less liquid, the prices received may be less than would
have been received had the markets been broader.
Exchange Controls. On the basis of the best information
available to the Sponsor at the present time none of the Bonds is
subject to exchange control restrictions under existing law which
would materially interfere with payment to a Trust of amounts due
on the Bonds. However, there can be no assurance that exchange
control regulations might not be adopted in the future which
might adversely affect payments to a Trust. In addition, the
adoption of exchange control regulations and other legal
restrictions could have an adverse impact on the marketability of
the Bonds in a Trust and on the ability of a Trust to satisfy its
obligation to redeem Units tendered to the Trustee for
redemption.
Jurisdiction over, and U.S. Judgments Concerning, Foreign
Obligors. Non-U.S issuers of the Bonds will generally not have
submitted to the jurisdiction of U.S. courts for purposes of
lawsuits relating to those Bonds. If a Trust contains Bonds of
such an issuer, the Trust as a holder of those obligations may
not be able to assert its rights in U.S. courts under the
documents pursuant to which the Bonds are issued. Even if a
Trust obtains a U.S. judgment against a foreign obligor, there
can be no assurance that the judgment will be enforced by a court
in the country in which the foreign obligor is located. In
addition, a judgment for money damages by a court in the United
States if obtained, will ordinarily be rendered only in U.S.
dollars. It is not clear, however, whether, in granting a
judgment, the rate of conversion of the applicable foreign
currency into U.S. dollars would be determined with reference to
the due date or the date the judgment is rendered. Courts in
other countries may have rules that are similar to, or different
from, the rules of the U.S. courts.
GENERAL TRUST INFORMATION
Because certain of the Bonds in the Trusts may from time to time
under certain circumstances be sold or redeemed or will mature in
accordance with their terms and because the proceeds from such
events will be distributed to Unitholders and will not be
reinvested, no assurance can be given that a Trust will retain
for any length of time its present size and composition. Neither
the Sponsor nor the Trustee shall be liable in any way for any
default, failure or defect in any Bond.
The Sponsor may not alter the portfolio of a Trust Fund except
upon the happening of certain extraordinary circumstances. See
"Investment Supervision." Certain of the Bonds may be subject to
optional call or mandatory redemption pursuant to sinking fund
provisions, in each case prior to their stated maturity. A bond
subject to optional call is one which is subject to redemption or
refunding prior to maturity at the option of the issuer, often at
a premium over par. A refunding is a method by which a bond
issue is redeemed, at or before maturity, by the proceeds of a
new bond issue. A bond subject to sinking fund redemption is one
which is subject to partial call from time to time at par from a
fund accumulated for the scheduled retirement of a portion of an
issue prior to maturity. Special or extraordinary redemption
provisions may provide for redemption at par of all or a portion
of an issue upon the occurrence of certain circumstances, which
may be prior to the optional call dates shown in "Schedule of
Investments" in Part Two of this Prospectus. Redemption pursuant
to optional call provisions is more likely to occur, and
redemption pursuant to special or extraordinary redemption
provisions may occur, when the Bonds have an offering side
evaluation which represents a premium over par, that is, when
they are able to be refinanced at a lower cost. The proceeds
from any such call or redemption pursuant to sinking fund
provisions as well as proceeds from the sale of Bonds and from
Bonds which mature in accordance with their terms, unless
utilized to pay for Units tendered for redemption, will be
distributed to Unitholders and will not be used to purchase
additional Bonds for the affected Trust. Accordingly, any such
call, redemption, sale or maturity will reduce the size and
diversity of a Trust and the net annual interest income and may
reduce the Estimated Current Return and the Estimated Long-Term
Return. See "Interest, Estimated Long-Term Return and Estimated
Current Return." The call, redemption, sale or maturity of Bonds
also may have tax consequences to a Unitholder. See "Federal Tax
Status." Information with respect to the call provisions and
maturity dates of the Bonds is contained in "Schedule of
Investments" in Part Two of this Prospectus.
To the best of the Sponsor's knowledge, there was no litigation
pending as of the Initial Date of Deposit for each Trust in
respect of any Bond which might reasonably be expected to have a
material adverse effect on the related Trust. At any time after
the Initial Date of Deposit, litigation may be instituted on a
variety of grounds with respect to the Bonds. The Sponsor is
unable to predict whether any such litigation may be instituted,
or if instituted, whether such litigation might have a material
adverse effect on the related Trust. The Sponsor and the Trustee
shall not be liable in any way, for any default, failure or
defect in any Bond.
RETIREMENT PLANS
Units of the Trust Funds may be well suited for purchase by
Individual Retirement Accounts, Keogh Plans, pension funds and
other qualified retirement plans, certain of which are briefly
described below.
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 Funds will waive the
$1,000 minimum investment requirement for IRA accounts. The minimum
investment is $250 for tax-deferred plans such as IRA
accounts. Fees and charges with respect to such plans may vary.
Individual Retirement Account--IRA. Any individual under age
70-1/2 may contribute the lesser of $2,000 or 100% of
compensation to an IRA annually. Such contributions are fully
deductible if the individual (and spouse if filing jointly) are
not covered by a retirement plan at work. The deductible amount
an individual may contribute to an IRA will be reduced $10 for
each $50 of adjusted gross income over $25,000 ($40,000 if
married, filing jointly or $0 if married, filing separately), if
either an individual or their spouse (if married, filing jointly)
is an active participant in an employer maintained retirement
plan. Thus, if an individual has adjusted gross income over
$35,000 ($50,000 if married, filing jointly or $0 if married,
filing separately) and if an individual or their spouse is an
active participant in an employer maintained retirement plan, no
IRA deduction is permitted. Under the Internal Revenue Code of
1986, as amended (the "Code"), an individual may make
nondeductible contributions to the extent deductible
contributions are not allowed. All distributions from an IRA
(other than the return of certain excess contributions) are
treated as ordinary income for federal income taxation purposes
provided that under the Code an individual need not pay tax on
the return of nondeductible contributions. The amount includable
in income for the taxable year is the portion of the amount
withdrawn for the taxable year as the individual's aggregate
deductible IRA contributions bear to the aggregate balance of all
IRAs of the individual.
A participant's interest in an IRA must be, or commence to be,
distributed to the participant not later than April 1 of the
calendar year following the year during which the participant
attains age 70-1/2. Distributions made before attainment of age
59-1/2, except in the case of the participant's death or
disability, or where the amount distributed is to be rolled over
to another IRA, or where the distributions are taken as a series
of substantially equal periodic payments over the participant's
life or life expectancy (or the joint lives or life expectancies
of the participant and the designated beneficiary) are generally
subject to a surtax in an amount equal to 10% of the
distribution. The amount of such periodic payments may not be
modified before the later of five years or attainment of age
59-1/2. Excess contributions are subject to an annual 6% excise
tax.
IRA applications, disclosure statements and trust agreements are
available from the Sponsor upon request.
Qualified Retirement Plans. Units of a Trust may be purchased by
qualified pension or profit sharing plans maintained by
corporations, partnerships or sole proprietors. The maximum
annual contribution for a participant in a money purchase pension
plan or to paired profit sharing and pension plans is the lesser
of 25% of compensation or $30,000. Prototype plan documents for
establishing qualified retirement plans are available from the
Sponsor upon request.
Excess Distributions Tax. In addition to the other taxes due by
reason of a plan distribution, a tax of 15% may apply to certain
aggregate distributions from IRAs, Keogh plans, and corporate
retirement plans to the extent such aggregate taxable
distributions exceed specified amounts (generally $150,000, as
adjusted) during a tax year. This 15% tax will not apply to
distributions on account of death, qualified domestic relations
orders or amounts eligible for tax-deferred rollover treatment.
In general, for lump sum distributions the excess distributions
over $750,000 (as adjusted) will be subject to the 15% tax.
The Trustee has agreed to act as custodian for certain retirement
plan accounts. An annual fee of $12.00 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 an EVEREN
UIT/IRA application and forward it along with a check made
payable to the Trustee. Certificates for Individual Retirement
Accounts cannot be issued.
DISTRIBUTION REINVESTMENT
Each Unitholder of a Trust may elect to have distributions of
principal (including capital gains, if any) or interest or both
automatically invested without charge in shares of any open-end
mutual fund underwritten or advised by Kemper Financial Services,
Inc. which is registered in the Unitholder's state of residence
(the "Kemper Funds"), other than those Kemper Funds sold with a
contingent deferred sales charge.
If individuals indicate they wish to participate in the
Reinvestment Program but do not designate a reinvestment fund,
the Program Agent referred to below will contact such individuals
to determine which reinvestment fund or funds they wish to elect.
Since the portfolio securities and investment objectives of such
Kemper Funds generally will differ significantly from those of
the Trust Funds, Unitholders should carefully consider the
consequences before selecting such Kemper Funds for reinvestment.
Detailed information with respect to the investment objectives
and the management of the Funds is contained in their respective
prospectuses, 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 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. See
"Unitholders_Distributions to Unitholders."
The Program Agent is the Trustee. All inquiries concerning
participation in distribution reinvestment should be directed to
the Program Agent at its unit investment trust office.
INTEREST, ESTIMATED LONG-TERM RETURN AND ESTIMATED CURRENT RETURN
As of the opening of business on the date indicated therein, the
Estimated Long-Term Return and the Estimated Current Return for
each Trust Fund were as set forth in the "Essential Information"
in Part Two of this Prospectus. Estimated Current Return is
calculated by dividing the estimated net annual interest income
per Unit by the Public Offering Price. The estimated net annual
interest income per Unit will vary with changes in fees and
expenses of the Trustee, the Sponsor and the Evaluator and with
the principal prepayment, redemption, maturity, exchange or sale
of the Bonds while the Public Offering Price will vary with
changes in the offering price of the underlying Bonds and with
changes in the Purchased Interest and Daily Accrued Interest;
therefore, there is no assurance that the present Estimated
Current Return will be realized in the future. Estimated
Long-Term Return is calculated using a formula which (1) takes
into consideration, and determines and factors in the relative
weightings of, the market values, yields (which takes into
account the amortization of premiums and the accretion of
discounts) and estimated retirements of all the Bonds in a Trust
and (2) takes into account the expenses and sales charge
associated with each Trust Unit. Since the market values and
estimated retirements of the Bonds and the expenses of a Trust
will change, there is no assurance that the present Estimated
Long-Term Return will be realized in the future. Estimated
Current Return and Estimated Long-Term Return are expected to
differ because the calculation of Estimated Long-Term Return
reflects the estimated date and amount of principal returned
while Estimated Current Return calculations include only net
annual interest income and Public Offering Price.
PUBLIC OFFERING OF UNITS
Public Offering Price. Units of each Trust Fund are offered at
the Public Offering Price thereof. The Public Offering Price is
based on the aggregate bid side evaluations of the Bonds in each
Trust Fund (as determined pursuant to the terms of a contract
with the Evaluator, by Cantor Fitzgerald & Co., a non-affiliated
firm regularly engaged in the business of evaluating, quoting or
appraising comparable securities), plus or minus cash, if any, in
the Principal Account held or owned by such Trust Fund, Purchased
Interest, if any, and accrued interest (or Daily Accrued
Interest) plus a sales charge based upon the dollar weighted
average maturity of such Trust Fund.
The sales charge is based upon the dollar weighted average
maturity of a Trust Fund and is determined in accordance with the
table set forth below. For purposes of this computation, Bonds
will be deemed to mature on their expressed maturity dates
unless: (a) the Bonds have been called for redemption or funds
or securities have been placed in escrow to redeem them on an
earlier call date, in which case such call date will be deemed to
be the date upon which they mature; or (b) such Bonds are subject
to a "mandatory tender," in which case such mandatory, tender
will be deemed to be the date upon which they mature. The effect of
this method of sales charge computation will be that different
sales charge rates will be applied to a Trust Fund based upon the
dollar weighted average maturity of such Trust Fund's portfolio,
in accordance with the following schedule:
PERCENT OF PERCENT OF
DOLLAR WEIGHTED AVERAGE PUBLIC OFFERING NET AMOUNT
YEARS TO MATURITY PRICE INVESTED
0 to .99 years 0.00% 0.000%
1 to 1.99 years 2.00 2.041
2 to 3.99 years 3.50 3.627
4 to 9.99 years 4.50 4.712
10 or more years 5.50 5.820
The sales charge per Unit will be reduced as set forth below:
DOLLAR WEIGHTED AVERAGE YEARS TO MATURITY*
2 to 3.99 4 to 9.99 10 or more
SALES CHARGE (PERCENT OF PUBLIC DOLLAR AMOUNT OF TRADE OFFERING PRICE)
$1,000 to $99,999 3.50% 4.50% 5.50%
$100,000 to $499,999 3.25 4.25 5.00
$500,000 to $999,999 3.00 4.00 4.50
$1,000,000 or more 2.75 3.75 4.00
- ------------------------------------------------------------------
* If the dollar weighted average maturity of a Trust Fund is
from 1 to 1.99 years, the sales charge is 2% and 1.5% of the
Public Offering Price for purchases of $1,000 to $249,999 and
$250,000 or more, respectively.
The reduced sales charges resulting from quantity discounts as
shown on the table above will apply to all purchases of Units on
any one day by the same purchaser from the same dealer and for
this purpose purchases of Units of a Trust Fund will be
aggregated with concurrent purchases of Units of any other unit
investment trust that may be offered by the Sponsor.
Additionally, Units purchased in the name of a spouse or child
(under 21) of such purchaser will be deemed to be additional
purchases by such purchaser. The reduced sales charges will also
be applicable to a trust or other fiduciary purchasing for a
single trust estate or single fiduciary account.
Investors who purchase Units through brokers or dealers pursuant
to a current management agreement which by contract or operation
of law does not allow such broker or dealer to earn an additional
commission (other than any fee or commission paid for maintenance
of such investor's account under the management agreement) on
such transactions may purchase such Units at the current Public
Offering Price net of the applicable broker or dealer concession.
See "Public Offering of Units_Public Distribution of Units"
below.
The Sponsor intends to permit officers, directors and employees
of the Sponsor and Evaluator and at the discussion the Sponsor
registered representatives of selling firms to purchase Units of
a Trust without a sales charge, although a transaction processing
fee may be imposed on such trades.
The Public Offering Price per Unit of a Trust Fund on the date of
this Prospectus or on any subsequent date will vary from the
amount stated under "Essential Information" in Part Two of this
Prospectus in accordance with fluctuations in the prices of the
underlying Bonds and the amount of accrued interest on the Units.
The aggregate bid side evaluations of the Bonds shall be
determined (a) on the basis of current bid prices of the Bonds,
(b) if bid price is not available for any particular Bond, on the
basis of current bid prices for comparable bonds, (c) by
determining the value of Bonds on the bid side of the market by
appraisal, or (d) by any combination of the above.
The foregoing evaluations and computations shall be made as of
the evaluation time stated under "Essential Information" in Part
Two of this Prospectus, on each business day effective for all
sales made during the preceding 24-hour period.
The interest on the Bonds deposited in a Trust Fund, less the
related estimated fees and expenses, is estimated to accrue in
the annual amounts per Unit set forth under "Essential
Information" in Part Two of this Prospectus. The amount of net
interest income which accrues per Unit may change as Bonds mature
or are redeemed, exchanged or sold, or as the expenses of a Trust
Fund change or the number of outstanding Units of a Trust Fund
changes.
Although payment is normally made three business days following
the order for purchase, payment may be made prior thereto. A
person will become the owner of Units on the date of settlement
provided payment has been received. Cash, if any, made available
to the Sponsor prior to the date of settlement for the purchase
of Units may be used in the Sponsor's business and may be deemed
to be a benefit to the Sponsor, subject to the limitations of the
Securities Exchange Act of 1934. If a Unitholder desires to have
certificates representing Units purchased, such certificates will
be delivered as soon as possible following his written request
therefor. For information with respect to redemption of Units
purchased, but as to which certificates requested have not been
received, see "Redemption" below.
Accrued Interest. The Public Offering Price for Corporate Income
Series 3 and subsequent series and all Investment Grade Corporate
Income Series includes accrued interest. Accrued interest is the
accumulation of unpaid interest on a security from the last day
on which interest thereon was paid. Interest on Securities
generally is paid semi-annually although a Trust accrues such
interest daily. Because of this, a Trust always has an amount of
interest earned but not yet collected by the Trustee. For this
reason, with respect to sales settling subsequent to the First
Settlement Date, the Public Offering Price of Units will have
added to it the proportionate share of accrued interest to the
date of settlement. Unitholders will receive on the next
distribution date of a Trust the amount, if any, of accrued
interest paid on their Units.
In an effort to reduce the amount of accrued interest which would
otherwise have to be paid in addition to the Public Offering
Price in the sale of Units to the public, the Trustee will
advance the amount of accrued interest as of the First Settlement
Date and the same will be distributed to the Sponsor as the
Unitholder of record as of the First Settlement Date.
Consequently, the amount of accrued interest to be added to the
Public Offering Price of Units will include only accrued interest
from the First Settlement Date to the date of settlement, less
any distributions from the Interest Account subsequent to the
First Settlement Date.
Because of the varying interest payment dates of the Securities,
accrued interest at any point in time will be greater than the
amount of interest actually received by the Trusts and
distributed to Unitholders. Therefore, there will always remain
an item of accrued interest that is added to the value of the
Units. If a Unitholder sells or redeems all or a portion of his
Units, he will be entitled to receive his proportionate share of
the accrued interest from the purchaser of his Units. Since the
Trustee has the use of the funds held in the Interest Account for
distributions to Unitholders and since such Account is
non-interest-bearing to Unitholders, the Trustee benefits
thereby.
Purchased and Daily Accrued Interest;. The Public Offering Price
for Corporate Income Series l and 2 includes Purchased and Daily
Accrued Interest. Accrued interest consists of two elements.
The first element arises as a result of accrued interest which is
the accumulation of unpaid interest on a bond from the later of
the last day on which interest thereon was paid or the date of
original issuance of the bond. Interest on the coupon Bonds in a
Trust Fund is paid semi-annually to such Trust. A portion of the
aggregate amount of such accrued interest on the Bonds in a Trust
to the First Settlement Date of such Trust is referred to herein
as "Purchased Interest." Included in the Public Offering Price
of Trust Units is the Purchased Interest. In an effort to reduce
the amount of Purchased Interest which would otherwise have to be
paid by Unitholders, the Trustee may have advanced a portion of
the accrued interest to the Sponsor as the Unitholder of record
as of the First Settlement Date. The second element of accrued
interest arises because the estimated net interest on the Units
in a Trust Fund is accounted for daily on an accrual basis
(herein referred to as "Daily Accrued Interest"). Because of
this, the Units always have an amount of interest earned but not
yet paid or reserved for payment. For this reason, the Public
Offering Price of Units will include the proportionate share of
Daily Accrued Interest to the date of settlement.
If a Unitholder sells or redeems all or a portion of his Units or
if the Bonds are sold or otherwise removed or if a Trust Fund is
liquidated, he will receive at that time his proportionate share
of the Purchased Interest, if any, and accrued interest (or Daily
Accrued Interest) computed to the settlement date in the case of
sale or liquidation and to the date of tender in the case of
redemption in a Trust Fund.
Public Distribution of Units. The Sponsor has qualified the
Units 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. Sales may be made to or
through dealers at prices which represent discounts from the Public
Offering Price as set forth below. Certain commercial
banks are making Units of the Trust Funds 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
amounts shown in the table below. Under the Glass-Steagall Act,
banks are prohibited from underwriting Trust Fund Units; however,
the Glass-Steagall Act does permit certain agency transactions
and the banking regulators have indicated that these particular
agency transactions are permitted under such Act. 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 discounts set forth below from time to time. In addition to
such discounts, the Sponsor may, from time to time, pay or allow
an additional discount, 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 the Trusts and other unit investment trusts created by
the Sponsor. The difference between the discount and the sales
charge will be retained by the Sponsor.
DOLLAR WEIGHTED AVERAGE YEARS TO MATURITY*
2 to 3.99 4 to 9.99 10 or more
DISCOUNT PER UNITDOLLAR AMOUNT OF TRADE (PERCENT OF PUBLIC
OFFERING PRICE)
$1,000 to $99,999 2.00% 3.00% 4.00%
$100,000 to $499,999 1.75 2.75 3.50
$500,000 to $999,999 1.50 2.50 3.00
$1,000,000 or more 1.25 2.25 2.50
- ------------------------------------------------------------------
* If the dollar weighted average maturity of a Trust Fund is
from 1 to 1.99 years, the concession or agency commission is
1.00% of the Public Offering Price.
The Sponsor reserves the right to reject, in whole or in part,
any order for the purchase of Units.
Profits of Sponsor. The Sponsor will receive gross sales charges
equal to the percentage of the Public Offering Price of the Units
of a Trust stated under "Public Offering Price" and will pay a
fixed portion of such sales charges to dealers and agents. The
Sponsor may also realize additional profit or loss as a result of
the possible change in the daily evaluation of the Bonds in a
Trust, since the value of its inventory may increase or decrease.
MARKET FOR UNITS
While not obligated to do so, the Sponsor intends to, subject to
change at any time, maintain a market for Units of the Trusts
offered hereby and to continuously offer to purchase said Units
at prices, determined by the Evaluator, based on the aggregate
bid prices of the underlying Bonds, together with Purchased
Interest, if any, and accrued interest (or Daily Accrued
Interest) to the expected dates of settlement. 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. The Sponsor may suspend or discontinue purchases of
Units if the supply of Units exceeds demand, or for other
business reasons.
REDEMPTION
A Unitholder who does not dispose of Units as described above may
cause Units to be redeemed by the Trustee by making a written
request to the Trustee 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 $25,000 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 on the third business day
following the day on which a tender for redemption is received
(the "Redemption Date") by payment of cash equivalent to the
Redemption Price for the Trust Fund, determined as set forth
below under "Computation of Redemption Price," as of the
evaluation time stated under "Essential Information" in Part Two
of this Prospectus, next following such tender, multiplied by the
number of Units being redeemed. Any Units redeemed shall be
cancelled and any undivided fractional interest in a Trust Fund
extinguished. The price received upon redemption might be more
or less than the amount paid by the Unitholder depending on the
value of the Bonds in a Trust Fund at the time of redemption.
Under regulations issued by the Internal Revenue Service, the
Trustee is required to withhold a certain 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 "backup 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 interest shall be
withdrawn from the Interest Account to the extent that funds are
available for such purpose. All other amounts paid on redemption
shall be withdrawn from the Principal Account. The Trustee is
empowered to sell Bonds in order to make funds available for the
redemption of Units. Such sale may be required when Bonds would
not otherwise be sold and might result in lower prices than might
otherwise be realized. To the extent Bonds are sold, the size
and diversity of a Trust Fund will be reduced.
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 Bonds is not reasonably
practicable or it is not reasonably practicable to fairly
determine the value of the underlying Bonds 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 for Units
is computed by the Evaluator as of the evaluation time stated
under "Essential Information" in Part Two of this Prospectus next
occurring after the tendering of a Unit for redemption and on any
other business day desired by it, by:
A. adding: (1) the cash on hand in a Trust other than
cash deposited in such Trust to purchase Bonds not applied to the
purchase of such Bonds; (2) the aggregate value of each issue of
the Bonds held in such Trust as determined by the Evaluator on
the basis of bid prices therefor; and (3) Purchased and Daily
Accrued Interest;
B. deducting therefrom (1) amounts representing any
applicable taxes or governmental charges payable out of such
Trust Fund and for which no deductions have been previously made
for the purpose of additions to the Reserve Account described
under "Expenses of the Trusts"; (2) an amount representing
estimated accrued expenses of such Trust Fund, including but not
limited to fees and expenses of the Trustee (including legal and
auditing fees), the Sponsor and the Evaluator; (3) cash held for
distribution to Unitholders of record as of the business day
prior to the evaluation being made; and (4) other liabilities
incurred by such Trust Fund; and
C. finally dividing the results of such computation by the
number of Units of such Trust Fund outstanding as of the date
thereof.
UNITHOLDERS
Ownership of Units. Ownership of Units of a Trust will not be
evidenced by certificates unless a Unitholder or the Unitholder's
registered 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 (if applicable), 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 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. In certain instances the Trustee may require additional
documents such as, but not limited to, trust instruments,
certificates of death, appointments as executor or administrator
or certificates of corporate authority.
Units may be purchased and certificates, if requested, will be
issued in denominations of one Unit or any whole Unit multiple
thereof subject to any minimum investment requirement established
by the Sponsor from time to time. 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.
Distributions to Unitholders. Interest received by a Trust,
including any portion of the proceeds from a disposition of Bonds
which represents accrued interest, is credited by the Trustee to
the Interest Account for such Trust. All other receipts are
credited by the Trustee to a separate Principal Account for such
Trust. Assuming a Trust Fund retains its original size and
composition, after deduction of the fees and expenses of the
Trustee, Sponsor and Evaluator and reimbursements (without
interest) to the Trustee for any amounts advanced to such Trust
Fund, the Trustee will normally distribute on each Interest
Distribution Date (the fifteenth of the month) or shortly
thereafter to Unitholders of record of such Trust Fund on the
preceding Record Date (the first day of each month), an amount
substantially equal to one-twelfth of such Unitholders' pro rata
share of the estimated net annual interest income to the Interest Account.
Persons who purchase Units between a Record Date and a
Distribution Date will receive their first distribution on the
second Distribution Date following their purchase of Units.
Since interest on the Bonds is payable at varying intervals,
usually in semi-annual installments, and distributions of income
are made to Unitholders at different intervals from receipt of
interest, the interest accruing to a Trust Fund may not be equal
to the amount of money received and available for distribution
from the Interest Account. Therefore, on each Distribution Date
the amount of interest actually deposited in the Interest Account
and available for distribution may be slightly more or less than
the interest distribution made. In order to eliminate
fluctuations in interest distributions resulting from such
variances, the Trustee is authorized by the Trust Agreement to
advance such amounts as may be necessary to provide interest
distributions of approximately equal amounts. The Trustee will
be reimbursed, without interest, for any such advances from funds
available in the Interest Account.
The Trustee will distribute on each Distribution Date or shortly
thereafter, to each Unitholder of record of each Trust Fund on
the preceding Record Date, an amount substantially equal to such
Unitholder's pro rata share of the cash balance, if any, in the
Principal Account computed as of the close of business on the
preceding Record Date. However, no distribution will be required
if the balance in the Principal Account is less than $1.00 per
100 Units.
Statements to Unitholders. With each distribution, the Trustee
will furnish or cause to be furnished to each Unitholder a
statement of the amount of interest and the amount of other
receipts, if any, which are being distributed, expressed in each
case as a dollar amount per Unit.
The accounts are required to be audited annually, at the related
Trust Fund's expense, by independent auditors designated by the
Sponsor, unless the Trustee determines that such an audit would
not be in the best interest of the Unitholders. 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
a statement for such Unitholder's Trust, covering the calendar
year, setting forth:
A. As to the Interest Account: (1) The amount of interest
received on the Bonds, including amounts received as a portion of
the proceeds of any disposition of the Bonds; (2) the amount paid
from the Interest Account representing accrued interest of any
Units redeemed; (3) the deductions from the Interest Account for
applicable taxes, if any, fees and expenses (including auditing
fees) of the Trustee, the Sponsor and the Evaluator; (4) any
amounts credited by the Trustee to the Reserve Account described
under "Expenses of the Trusts"; and (5) the net amount remaining
after such payments and deductions, expressed both as a total
dollar amount and a dollar amount per Unit outstanding on the
last business day of such calendar year; and
B. As to the Principal Account: (1) The dates of the
maturity, liquidation or redemption of any of the Bonds and the
net proceeds received therefrom excluding any portion credited to
the Interest Account; (2) the amount paid from the Principal
Account representing the principal of any Units redeemed; (3) the
deductions from the Principal Account for payment of applicable
taxes, if any, fees and expenses (including auditing fees) of the
Trustee, the Sponsor and the Evaluator; (4) any amounts credited
by the Trustee to the Reserve Account described under "Expenses
of the Trusts"; and (5) the net amount remaining after
distributions of principal and deductions, expressed both as a
dollar amount and as a dollar amount per Unit outstanding on the
last business day of the calendar year; and
C. The following information: (1) A list of the Bonds 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; and (4) the amount actually distributed
during such calendar year from the Interest and Principal
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 the
related Trust.
INVESTMENT SUPERVISION
The Sponsor may not alter the portfolio of a Trust by the
purchase, sale or substitution of Bonds, except in the special
circumstances noted below. Thus, with the exception of the
redemption or maturity of Bonds in accordance with their terms,
the assets of a Trust Fund will remain unchanged under normal
circumstances.
The Sponsor may direct the Trustee to dispose of Bonds the value
of which has been affected by certain adverse events including
institution of certain legal proceedings or decline in price or
the occurrence of other market factors, including advance
refunding, so that in the opinion of the Sponsor the retention of
such Bonds in a Trust Fund would be detrimental to the interest
of the Unitholders. The proceeds from any such sales, exclusive
of any portion which represents accrued interest, will be
credited to the Principal Account of a Trust Fund for
distribution to the Unitholders.
The Sponsor is required to instruct the Trustee to reject any
offer made by an issuer of Bonds to issue new obligations in
exchange or substitution for any of such Bonds pursuant to a
refunding or refinancing plan, except that the Sponsor may
instruct the Trustee to accept or reject such an offer or to take
any other action with respect thereto as the Sponsor may deem
proper if (1) the issuer is in default with respect to such Bonds
or (2) in the written opinion of the Sponsor the issuer will
probably default with respect to such Bonds in the reasonably
foreseeable future. Any obligation so received in exchange or
substitution will be held by the Trustee subject to the terms and
conditions of the Trust Agreement to the same extent as Bonds
originally deposited thereunder. Within five days after the
deposit of obligations in exchange or substitution for underlying
Bonds, the Trustee is required to give notice thereof to each
Unitholder, identifying the Bonds eliminated and the Bonds
substituted therefor.
The Trustee may sell Bonds, designated by the Sponsor, from a
Trust Fund for the purpose of redeeming Units of such Trust Fund
tendered for redemption and the payment of expenses.
ADMINISTRATION OF THE TRUSTS
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 offices at 101 Barclay Street, New York, New York
10286, 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. For
information relating to the responsibilities of the Trustee under
the Trust Agreement, reference is made to the material set forth
under "Unitholders."
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 of the related Trust Fund at
all reasonable times during usual business hours. The Trustee
shall make such annual or other reports as may from Time to lime
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 Bonds held in each Trust Fund. Pursuant to the Trust
Agreement, the Trustee may employ one or more agents for the
purpose of custody and safeguarding of the Bonds comprising a
Trust Fund.
Under the Trust Agreement, the Trustee or any successor trustee
may resign and be discharged of the 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
60 days before the date specified in such notice when such
resignation is to take effect. The Sponsor upon receiving notice
of such resignation is obligated to appoint a successor trustee promptly.
If, upon such resignation, no successor trustee has
been appointed and has accepted the appointment within 30 days
after notification, the retiring Trustee may apply to a court of
competent jurisdiction for the appointment of a successor. The
Sponsor may remove the Trustee at any time 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;. The Sponsor, EVEREN Unit Investment Trusts, with
an office at 77 West Wacker Drive, 29th Floor, Chicago, Illinois
60601, (800) 621-5024, is a service of EVEREN Securities, Inc.,
which is a wholly-owned subsidiary of EVEREN Capital Corporation.
The Sponsor was formerly known as Kemper Unit Investment Trusts,
a service of Kemper Securities, Inc. The Sponsor acts as
underwriter of a number of other EVEREN unit investment trusts
and will act as underwriter of any other unit investment trust
products developed by the Sponsor in the future. As of December
31, 1995, the total stockholder's equity of EVEREN Securities,
Inc. was $261,286,862.
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 a Trust Fund as provided therein or (c) continue to act
as Trustee without terminating the Trust Agreement.
The foregoing financial information with regard to the Sponsor
relates only to the Sponsor and not to any Trust Fund. 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 Funds. More comprehensive financial
information can be obtained upon request from the Sponsor.
The Evaluator. The Sponsor also serves as Evaluator. The
Evaluator 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 30 days after notice of resignation, the
Evaluator may apply to a court of competent jurisdiction for the
appointment of a successor. Notice of such resignation or
removal and appointment shall be mailed by the Trustee to each Unitholder.
At the present time, pursuant to a contract with the
Evaluator, Cantor Fitzgerald & Co., a non-affiliated firm
regularly engaged in the business of evaluating, quoting or
appraising comparable securities, provides portfolio evaluations
of the Bonds in each Trust Fund which are then reviewed by the
Evaluator. In the event the Sponsor is unable to obtain current
evaluations from Cantor Fitzgerald & Co., it may make its own
evaluations or it may utilize the services of any other
non-affiliated evaluator or evaluators it deems appropriate.
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 interests of the Unitholders (as determined in good
faith by the Sponsor and the Trustee). The Trust Agreement 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 66-1/3% of the Units then
outstanding of a Trust Fund, 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 related Trust. Except in
accordance with the provisions of the Trust Agreement, in no
event shall the Trust Agreement be amended to increase the number
of Units of the Trust issuable thereunder or to permit the
acquisition of any Bonds in addition to or in substitution for
those initially deposited in a Trust Fund (other than as provided
in the Trust Agreement). The Trustee shall promptly notify
Unitholders of the substance of any such amendment.
The Trust Agreement provides that a Trust Fund shall terminate
upon the maturity, redemption or other disposition of the last of
the Bonds held in such Trust Fund, but in no event later than the
Mandatory Termination Date set forth under "Essential
Information" in Part Two of this Prospectus. If the value of a
Trust Fund shall be less than the applicable minimum value stated
under "Essential Information" in Part Two of this Prospectus (40%
of the aggregate principal amount of Bonds deposited in such
Trust), the Trustee may, in its discretion, and shall, when so
directed by the Sponsor, terminate such Trust Fund. A Trust Fund
may be terminated at any time by the holders of Units
representing 66-2/3% of the Units thereof then outstanding. In
the event of termination of a Trust Fund, written notice thereof
will be sent by the Trustee to all Unitholders of such Trust
Fund. Within a reasonable period after termination, the Trustee
will sell any Bonds remaining in such Trust Fund and, after
paying all expenses and charges incurred by such Trust Fund, 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 Interest and Principal
Accounts of such Trust Fund.
Limitations on Liability. The Sponsor: 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 misfeasance in the performance
of its duties or by reason of its reckless disregard of its
obligations and duties under the Trust Agreement. The Sponsor
shall not be liable or responsible in any way for depreciation or
loss incurred by reason of the sale of any Bonds.
The Trustee: 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 monies, Bonds or certificates except by reason of
its own gross negligence, bad faith or willful misfeasance in the
performance of its duties or by reason of its reckless disregard
of its obligations and duties under the Trust Agreement. The
Trustee shall not be liable or responsible in any way for
depreciation or loss incurred by reason of the sate by the
Trustee of any Bonds. 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 Bonds or upon the interest
thereon.
The Evaluator: 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 only for its gross negligence, bad
faith or willful misfeasance in the performance of its duties or
by reason of its reckless disregard of its obligations and duties
under the Trust Agreement.
EXPENSES OF THE TRUSTS
The Sponsor will not charge the Trusts any fees for services
performed as Sponsor, except that the Sponsor shall receive an
annual surveillance fee, which is not to exceed the amount set
forth under "Essential Information" in Part Two of this
Prospectus for providing portfolio surveillance services for the
Trusts. Such fee (which is based on the largest number of Units
outstanding during each year) may exceed the actual costs of
providing such surveillance services for a Trust, but at no time
will the total amount received for portfolio surveillance
services rendered to a Trust and to any other unit investment
trusts sponsored by the Sponsor for which it provides portfolio
surveillance services in any calendar year exceed the aggregate
cost to the Sponsor of supplying such services in such year. The
foregoing fees may be increased without approval of the
Unitholders by amounts not exceeding proportionate increases
under the category "All Services Less Rent of Shelter" in the Consumer
Price Index published by the United States Department of
Labor or, if such category is no longer published, in a
comparable category. The Sponsor will receive a portion of the
sales commissions paid in connection with the purchase of Units
and will retain the profits, if any, related to the deposit of
Bonds in a Trust Fund. The Sponsor has borne all the expenses of
creating and establishing the Trusts including the cost of the
initial preparation, printing and execution of the Prospectus,
Trust Agreement and certificates, legal and accounting expenses,
advertising and selling expenses, payment of closing fees, the
expenses of the Trustee, evaluation fees relating to the deposit
and other out-of-pocket expenses.
The Trustee receives for its services the fee set forth under
"Essential Information" in Part Two of this Prospectus. The
Trustee's fee which is calculated monthly is based on the largest
aggregate principal amount of Bonds in each Trust Fund at any
time during the period. Funds that are available for future
distributions, redemptions and payment of expenses are held in
accounts which are non-interest bearing to Unitholders and are
available for use by the Trustee pursuant to normal banking
procedures; however, the Trustee is also authorized by the Trust
Agreement to make from time to time certain non-interest bearing
advances to a Trust Fund. The Trustee's fee is payable on or
before each Distribution Date. See "Unitholders_Distributions to
Unitholders."
For evaluation of the Bonds, the Evaluator shall receive a fee,
payable monthly, calculated on the basis of that annual rate set
forth under "Essential Information" in Part Two of this
Prospectus based upon the largest aggregate principal amount of
Bonds in the related Trust Fund at any time during such monthly
period.
The Trustee's fees, the Evaluator's fees and the surveillance
fees are deducted from the Interest Account of the appropriate
Trust Fund to the extent funds are available and then from the
Principal Account of such Trust. Such fees may be increased
without approval of Unitholders by amounts not exceeding a
proportionate increase in the Consumer Price index entitled "All
Services Less Rent of Shelter," published by the United States
Department of Labor, or any equivalent index substituted
therefor.
The following additional charges are or may be incurred by a
Trust Fund: (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 any
agent for custody and safeguarding of Bonds); (c) various
governmental charges; (d) expenses and costs of any action taken
by the Trustee to protect such 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 such Trust not resulting from gross negligence, bad faith or
willful misconduct on its part; (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; and (g) expenditures incurred in contacting Unitholders
upon termination of such Trust Fund. 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 such Trust.
Fees and expenses of a Trust Fund shall be deducted from the
Interest Account thereof, or, to the extent funds are not
available in such Account, from the Principal Account. The
Trustee may withdraw from the Principal Account or the Interest
Account such amounts, if any, as it deems necessary to establish
a reserve for any taxes or other governmental charges or other
extraordinary expenses payable out of a Trust. Amounts so
withdrawn shall be credited to a separate account maintained for
each Trust Fund known as the Reserve Account and shall not be
considered a part of the Trust Fund when determining the value of
the Units until such time as the Trustee shall return all or any
part of such amounts to the appropriate account.
LEGAL OPINIONS
The legality of the Units offered hereby and certain matters
relating to Federal tax law have been passed upon by Chapman and
Cutler, 111 West Monroe Street, Chicago, Illinois 60603, as
counsel for the Sponsor.
INDEPENDENT AUDITORS
The statement of net assets, including the schedule of
investments, appearing in Part Two of this Prospectus, with
information pertaining to the specific Trust to which such
statement relates, has been audited by Ernst & Young LLP,
independent auditors, as set forth in their report appearing in
Part Two of this Prospectus, and is included herein in reliance
upon the authority of said firm as experts in accounting and
auditing.
DESCRIPTION OF RATINGS*
Standard & Poor's. _ A brief description of the applicable
Standard & Poor's, a Division of The McGraw-Hill Companies, Inc.,
("Standard & Poor's") rating symbols and their meanings follow:
A Standard & Poor's corporate or municipal bond rating is a
current assessment of the creditworthiness of an obligor with
respect to a specific debt obligation. This assessment may take
into consideration obligors such as guarantors, insurers, or
lessees.
The bond rating is not a recommendation to purchase, sell or hold
a security, inasmuch as it does not comment as to market price or
suitability for a particular investor.
The ratings are based on current information furnished by the
issuer and obtained by Standard & Poor's from other sources it
considers reliable. Standard & Poor's does not perform an audit
in connection with any rating and may, on occasion, rely on
unaudited financial information. The ratings may be changed,
suspended, or withdrawn as a result of changes in, or
unavailability of, such information, or for other circumstances.
The ratings are based, in varying degrees, on the following
considerations:
I. Likelihood of default _ capacity and willingness of the
obligor as to the timely payment of interest and repayment of
principal in accordance with the terms of the obligation;
II. Nature of and provisions of the obligation;
III. Protection afforded by, and relative position of, the
obligation in the event of bankruptcy, reorganization or other
arrangement, under the laws of bankruptcy and other laws
affecting creditors' rights.
AAA _ Bonds rated AAA have the highest rating assigned by
Standard & Poor's to a debt obligation. Capacity to pay interest
and repay principal is extremely strong.
AA _ Bonds rated AA have a very strong capacity to pay interest
and repay principal and differ from the highest rated issues only
in small degree.
- ----------------------
* As described by the rating company itself.
A _ Bonds rated A have a strong capacity to pay interest and
repay principal although they are somewhat more susceptible to
the adverse effects of changes in circumstances and economic
conditions than bonds in higher rated categories.
BBB _ Bonds rated BBB are regarded as having an adequate capacity
to pay interest and repay principal. Whereas they normally
exhibit adequate protection parameters, adverse economic
conditions or changing circumstances are more likely to lead to a
weakened capacity to pay interest and repay principal for bonds
in this category than for bonds in higher rated categories.
Bonds rated 'BB,' 'B,' 'CCC,' 'CC,' and 'C' are regarded as
having predominantly speculative characteristics with respect to
capacity to pay interest and repay principal.
'BB' indicates the least degree of speculation and 'C,' the
highest degree of speculation, While such Bonds will likely have
some quality and protective characteristics, these are outweighed
by large uncertainties or major risk exposures to adverse
conditions.
BB _ Bonds rated BB have less near-term vulnerability to default
than other speculative grade debt. However, it faces major
ongoing uncertainties or exposure to adverse business, financial,
or economic conditions that could lead to inadequate capacity to
meet timely interest and principal payments.
B _ Bonds rated B have greater vulnerability to default but
presently has the capacity to meet interest payments and
principal repayments. Adverse business, financial, or economic
conditions would likely impair capacity or willingness to pay
interest and repay principal.
CCC _ Bonds rated CCC have a current identifiable vulnerability
to default, and is dependent on favorable business, financial,
and economic conditions to meet timely payment of interest and
repayment of principal. In the event of adverse business,
financial, or economic conditions, it is not likely to have the
capacity to pay interest and repay principal.
CC _ The rating CC is typically applied to debt subordinated to
senior debt which is assigned an actual or implied CCC rating.
C _ The rating C is typically applied to debt subordinated to
senior debt which is assigned an actual or implied CCC debt
rating.
D _ Bonds are rated D when the issue is in payment default, or
the obligor has filed for bankruptcy. The D rating is used when
interest or principal payments are not made on the date due, even
if the applicable grace period has not expired, unless S&P
believes that such payments will be made during such grace
period.
Plus (+) or Minus (-): The ratings from "AA" to "A" may be
modified by the addition of a plus or minus sign to show relative
standing within the major rating categories.
Provisional Ratings: The letter "p" indicates the rating is
provisional. A provisional rating assumes the successful
completion of the project being financed by the bonds being rated
and indicates that payment of debt service requirements is
largely or entirely dependent upon the successful and timely
completion of the project. This rating, however, while
addressing credit quality subsequent to completion of the
project, makes no comment on the likelihood of, or the risk of
default upon failure of, such completion. The investor should
exercise his own judgment with respect to such likelihood and
risk.
Moody's Investors Service, Inc. _ A brief description of the
applicable Moody's Investors Service, Inc. rating symbols and
their meanings follow:
Aaa _ Bonds which are rated Aaa are judged to be of the best
quality. They carry the smallest degree of investment risk and
are generally referred to as "gilt edge." Interest payments are
protected by a large or by an exceptionally stable margin and
principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most
unlikely to impair the fundamentally strong position of such
issues. Their safety is so absolute that with the occasional
exception of oversupply in a few specific instances,
characteristically, their market value is affected solely by
money market fluctuations.
Aa _ Bonds which are rated Aa are judged to be of high quality by
all standards. Together with the Aaa group they comprise what
are generally known as high grade bonds. They are rated lower
than the best bonds because margins of protection may not be as
large as in Aaa securities or fluctuations of protective elements
may be of greater amplitude or there may be other elements
present which make the long term risks appear somewhat larger
than in Aaa securities. Their market value is virtually immune
to all but money market influences, with the occasional exception
of oversupply in a few specific instances.
A _ Bonds which are rated A possess many favorable investment
attributes and are to be considered as upper medium grade
obligations. Factors giving security to principal and interest
are considered adequate, but elements may be present which
suggest a susceptibility to impairment sometime in the future.
The market value of A-rated bonds may be influenced to some
degree by economic performance during a sustained period of
depressed business conditions, but, during periods of normalcy,
A-rated bonds frequently move in parallel with Aaa and Aa
obligations, with the occasional exception of oversupply in a few
specific instances.
A1 _ Bonds which are rated Al offer the maximum in security
within their quality group, can be bought for possible upgrading in
quality, and additionally, afford the investor an opportunity
to gauge more precisely the relative attractiveness of offerings
in the marketplace.
Baa _ Bonds which are rated Baa are considered as lower medium
grade obligations, i.e., they are neither highly protected nor
poorly secured. Interest payments and principal security appear
adequate for the present but certain protective elements may be
lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment
characteristics and, in fact, have speculative characteristics as
well. The market value of Baa-rated bonds is more sensitive to
changes in economic circumstances and, aside from occasional
speculative factors applying to some bonds of this class, Baa
market valuations move in parallel with Aaa, Aa and A obligations
during periods of economic normalcy, except in instances of
oversupply.
Ba _ Bonds which are rated Ba are judged to have speculative
elements; their future cannot be considered as well assured.
Often the protection of interest and principal payments may be
very moderate and thereby not well safeguarded during both good
and bad times over the future. Uncertainty of position
characterizes bonds in this class.
B _ Bonds which are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal
payments or of maintenance of other terms of the contract over
any long period of time may be small.
Caa _ Bonds which are rated Caa are of poor standing. Such
issues may be in default or there may be present elements of
danger with respect to principal or interest.
Ca _ Bonds which are rated Ca represent obligations which are
speculative in a high degree. Such issues are often in default
or have other marked shortcomings.
C _ Bonds which are rated C are the lowest rated class of bonds
and issues so rated can be regarded as having extremely poor
prospects of ever attaining any real investment standing.
Conditional Ratings: Bonds rated "Con(_)" are ones for which the
security depends upon the completion of some act or the
fulfillment of some condition. These are bonds secured by (a)
earnings of projects under construction, (b) earnings of projects
unseasoned in operation experience, (c) rentals which begin when
facilities are completed, or (d) payments to which some other
limiting conditions attaches. Parenthetical rating denotes
probable credit stature upon completion of construction or
elimination of basis of condition.
NOTE: Moody's applies numerical modifiers, 1, 2, and 3 in each
generic rating classification from Aa through B in certain areas
of its bond rating system. The modifier 1 indicates that the
security ranks in the higher end of its generic rating category;
the modifier 2 indicates a mid-range ranking; and the modifier 3
indicates that the issue ranks in the lower end of its generic
rating category.
Duff & Phelps Credit Rating Co. _ A brief description of the
applicable Duff & Phelps Credit Rating Co. rating symbols and
their meanings follow:
These ratings represent a summary opinion of the issuer's
long-term fundamental quality. Rating determination is based on
qualitative and quantitative factors which may vary according to
the basic economic and financial characteristics of each industry
and each issuer. Important considerations are vulnerability to
economic cycles as well as risks related to such factors as
competition, government action, regulation, technological
obsolescence, demand shifts, cost structure, and management depth
and expertise. The projected viability of the obligor at the
trough of the cycle is a critical determination.
AAA - Highest credit quality. The risk factors are negligible,
being only slightly more than for risk-free U.S. Treasury debt.
AA _ High credit quality. Protection factors are strong. Risk
is modest but may vary slightly from time to time because of
economic conditions.
A _ Protection factors are average but adequate. However, risk
factors are more variable and greater in periods of economic
stress.
BBB _ Below average protection factors but still considered
sufficient for prudent investment. Considerable variability in
risk during economic cycles.
BB _ Below investment grade but deemed likely to meet obligations
when due. Present or prospective financial protection factors
fluctuate according to industry conditions or company fortunes.
Overall quality may move up or down frequently within this
category.
B _ Below investment grade and possessing risk that obligations
will not be met when due. Financial protection factors will
fluctuate widely according to economic cycles, industry
conditions and/or company fortunes. Potential exists for
frequent changes in the rating within this category or into a
higher or lower rating grade.
CCC _ Well below investment grade securities. Considerable
uncertainty exists as to timely payment of principal, interest or
preferred dividends. Protection factors are narrow and risk can
be substantial with unfavorable economic/industry conditions,
and/or with unfavorable company developments.
DD _ Defaulted debt obligations. Issuer failed to meet scheduled
principal and/or interest payments.
CONTENTS Page
SUMMARY 2
THE TRUST FUNDS 3
COMPENSATION FOR FOREIGN WITHHOLDING TAX 4
FEDERAL TAX STATUS 4
TAX REPORTING ANDREALLOCATION 9
TRUST PORTFOLIOS 10
PORTFOLIO SELECTION 10
RISK FACTORS 10
GENERAL TRUST INFORMATION 14
RETIREMENT PLANS 15
DISTRIBUTION REINVESTMENT 17
INTEREST, ESTIMATED LONG-TERM RETURN AND ESTIMATED CURRENT
RETURN 17
PUBLIC OFFERING OF UNITS 18
Public Offering Price 18
Accrued Interest 20
Purchased and Daily Accrued Interest 21
Public Distribution of Units 21
Profits of Sponsor 22
MARKET FOR UNITS 22
REDEMPTION 23
UNITHOLDERS 24
Ownership of Units 24
Distributions to Unitholders 25
Statements to Unitholders 26
Rights of Unitholders 27
INVESTMENT SUPERVISION 27
ADMINISTRATION OF THE TRUSTS 28
The Trustee 28
The Sponsor 29
The Evaluator 29
Amendment and Termination 29
Limitations on Liability 30
EXPENSES OF THE TRUSTS 31
LEGAL OPINIONS 32
INDEPENDENT AUDITORS 32
DESCRIPTION OF RATINGS 33
This Prospectus does not contain all of the information set forth
in the registration statement and exhibits relating thereto,
filed with the Securities and Exchange Commission, Washington,
D.C. under the Securities Act of 1933 and the Investment Company
Act of 1940, and to which reference is made.
No person is authorized to give any information or to make any
representations not contained in this Prospectus and any
information or representation not contained herein must not be
relied upon as having been authorized by the Trusts, the Trustee,
or the Sponsor. The Trusts are registered as unit investment
trusts under the Investment Company Act of 1940. Such
registration does not imply that the Trusts or the Units have
been guaranteed, sponsored, recommended or approved by the United
States or any state or any agency or officer thereof.
This Prospectus does not constitute an offer to sell, or a
solicitation of an offer to buy, securities in any state to any
person to whom it is not lawful to make such offer in such state.
KEMPERDEFINED FUNDS.
CORPORATE
CORPORATE INCOME SERIES
AND
INVESTMENT GRADE CORPORATEINCOME SERIES
Dated as of the date set forth in Part Two of this Prospectus
EVEREN UNIT INVESTMENT TRUSTS
<PAGE>
Kemper Defined Funds
Corporate Income Series 1
Part Two
Dated April 29, 1996
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
NOTE: Part Two of this Prospectus May Not Be Distributed unless Accompanied by
Part One.
<PAGE>
Kemper Defined Funds
Corporate Income Series 1
Essential Information
As of December 31, 1995
Sponsor and Evaluator: EVEREN Unit Investment Trusts(3)
Trustee: Investors Fiduciary Trust Company(4)
<TABLE>
<CAPTION>
General Information
<S> <C>
Principal Amount of Securities $62,552,500
Number of Units 6,255,250
Fractional Undivided Interest in the Trust per Unit 1/6,255,250
Principal Amount of Securities per Unit $10
Calculation of Public Offering Price:
Aggregate Value of Securities in the Trust $59,959,200
Aggregate Value of Securities per Unit $9.585
Principal Cash per Unit (1) $.001
Purchased Interest per Unit through settlement date
of January 4, 1996 $.094
Total Price including Purchased Interest per Unit $9.680
Sales Charge of 4.5% of Public Offering Price
(4.712% of net amount invested) per Unit $.456
Public Offering Price per Unit $10.136
Redemption Price per Unit $9.680
Calculation of Estimated Net Annual Interest Income per Unit:
Estimated Annual Interest Income $.8337
Less: Estimated Annual Expense $.0172
Estimated Net Annual Interest Income $.8165
Daily Rate at which Estimated Net Annual Interest Income
Accrues per Unit $.002268
Estimated Current Return Based on Public Offering Price (2) 8.06%
Estimated Long-Term Return (2) 8.03%
</TABLE>
[FN]
1. This amount, if any, represents principal cash or overdraft which is an
asset or liability of the Trust and is included in the Public Offering Price.
2. The Estimated Current Return and Estimated Long-Term Return will vary with
changes in the Public Offering Price and there is no assurance that such
returns on the date hereof will be applicable on a subsequent date of
purchase. These estimated returns are increased for transactions entitled to
a reduced sales charge (see "Public Offering of Units - Public Offering
Price" - Part One).
3. See Note 1 to the accompanying financial statements of the Trust regarding
a change in ownership of Kemper Unit Investment Trusts and Kemper Securities,
Inc.
4. See Note 6 to the accompanying financial statements of the Trust regarding
the change in Trustee.
<PAGE>
Kemper Defined Funds
Corporate Income Series 1
Essential Information (continued)
As of December 31, 1995
Sponsor and Evaluator: EVEREN Unit Investment Trusts
Trustee: Investors Fiduciary Trust Company
Record and Distribution Date Record Date is the first of each
month and distributions to
Unitholders on such record dates
will be made on the 15th day of the
month.
Distribution Dates No distribution (other than capital
gains distributions) need be made
from the Principal Account if the
balance therein, excluding capital
gains, is less than $1.00 per Unit.
Trustee's Annual Fee (including
estimated expenses) $1.23 per 100 Units (includes $.949
of Trustee's annual fee per $1,000
principal amount of underlying
Securities and $.15 of out-of-pocket
expenses per 100 Units).
Evaluator's Annual Fee $.30 per $1,000 principal amount of
underlying Securities.
Surveillance Fee $.25 per $1,000 principal amount of
underlying Securities.
Date of Trust Agreement and
Initial Deposit November 3, 1993
Mandatory Termination Date December 31, 2005
Weighted Average Stated Maturity
of Bonds 6.68 years
Discretionary Liquidation Amount The Trust may be terminated if the
value thereof is less than
$25,021,000 (40% of the par value of
the Securities deposited in the
Trust).
<PAGE>
Report of Independent Auditors
Unitholders
Kemper Defined Funds
Corporate Income Series 1
We have audited the accompanying statement of assets and liabilities of Kemper
Defined Funds Corporate Income Series 1, including the schedule of
investments, as of December 31, 1995, and the related statements of operations
and changes in net assets for each of the two years in the period then ended
and for the period from November 3, 1993 (Date of Initial Deposit) to
December 31, 1993. These financial statements are the responsibility of the
Trust's sponsor. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. Our
procedures included confirmation of investments owned as of December 31, 1995,
by correspondence with the custodial bank. An audit also includes assessing
the accounting principles used and significant estimates made by the sponsor,
as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Kemper Defined Funds
Corporate Income Series 1 at December 31, 1995, and the results of its
operations and the changes in its net assets for the periods indicated above
in conformity with generally accepted accounting principles.
Ernst & Young LLP
Kansas City, Missouri
April 15, 1996
<PAGE>
Kemper Defined Funds
Corporate Income Series 1
Statement of Assets and Liabilities
December 31, 1995
<TABLE>
<CAPTION>
<S> <C> <C>
Assets
Securities, at value (cost $60,653,701) $59,959,200
Interest receivable 1,331,982
-----------
Total assets 61,291,182
Liabilities and net assets
Cash overdraft 351,436
Accrued liabilities 10,026
-----------
361,462
Net assets, applicable to 6,255,250 Units
outstanding:
Cost of Trust assets, including purchased
interest of $544,206 $61,197,907
Unrealized depreciation (694,501)
Distributable funds 426,314
----------- -----------
Net assets $60,929,720
===========
Net asset value per Unit $9.74
===========
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
Kemper Defined Funds
Corporate Income Series 1
Statements of Operations
<TABLE>
<CAPTION>
Period from
Nov. 3,
1993 to
Year ended Dec. 31 Dec. 31,
1995 1994 1993
<S> <C> <C> <C>
----------- ------------ ---------
Investment income - interest $5,480,595 $4,476,662 $228,420
Expenses:
Trustee's fees and related expenses 76,304 61,454 4,190
Evaluator's and portfolio
surveillance fees 34,404 28,889 1,970
----------- ------------ ---------
Total expenses 110,708 90,343 6,160
----------- ------------ ---------
Net investment income 5,369,887 4,386,319 222,260
Unrealized appreciation
(depreciation) on investments
during the period 4,926,085 (5,421,718) (198,868)
----------- ------------ ---------
Net increase (decrease) in net assets
resulting from operations $10,295,972 $(1,035,399) $23,392
=========== ============ =========
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
Kemper Defined Funds
Corporate Income Series 1
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
Period from
Nov. 3,
1993 to
Year ended Dec. 31 Dec. 31,
1995 1994 1993
<S> <C> <C> <C>
----------- ----------- -----------
Operations:
Net investment income $5,369,887 $4,386,319 $222,260
Unrealized appreciation
(depreciation) on investments
during the period 4,926,085 (5,421,718) (198,868)
----------- ----------- -----------
Net increase (decrease) in net assets
resulting from operations 10,295,972 (1,035,399) 23,392
Distributions to Unitholders:
Net investment income (5,131,869) (3,167,918) (17,298)
Principal from investment
transactions - (987,299) (73,675)
----------- ----------- -----------
Total distributions to Unitholders (5,131,869) (4,155,217) (90,973)
Capital transactions:
Issuance of 2,865,000 Units - - 28,367,690
Issuance of 3,390,250 Units - 32,656,124 -
----------- ----------- -----------
Total increase in net assets 5,164,103 27,465,508 28,300,109
Net assets:
Beginning of the period 55,765,617 28,300,109 -
----------- ----------- -----------
End of the period (including
distributable funds applicable
to Trust Units of $426,314,
$424,306 and $193,964 at
December 31, 1995, 1994 and
1993, respectively) $60,929,720 $55,765,617 $28,300,109
=========== =========== ===========
Trust Units outstanding at the end
of the period 6,255,250 6,255,250 2,865,000
=========== =========== ===========
</TABLE>
[FN]
See accompanying notes to financial statements.
<PAGE>
<TABLE>
Kemper Defined Funds
Corporate Income Series 1
Schedule of Investments
December 31, 1995
<CAPTION>
Coupon Maturity Redemption Principal
Name of Issuer Rate Date Provisions(2) Rating(1) Amount(4) Value(3)
<S> <C> <C> <C> <C> <C> <C>
------- ---------- -------------- -------- ----------- -----------
AIM Management Group, Inc. 9.00% 11/15/2003 1998 @ 104.5 BB $3,275,000 $3,283,679
Best Buy Co., Inc. 8.625 10/01/2000 1998 @ 102.5 B+ 1,965,000 1,975,080
Borg Warner Security Corporation 9.125 5/01/2003 1998 @ 104.56 B 3,275,000 2,876,891
Century Communications Corporation (5) 0.00 3/15/2003 Non-Callable B+ 3,930,000 2,053,425
Clark Oil & Refining Corporation 9.50 9/15/2004 1997 @ 104.75 BB 3,275,000 3,438,750
Coltec Industries, Inc. 9.75 4/01/2000 Non-Callable B+ 2,620,000 2,759,823
Domtar, Incorporated 11.75 3/15/1999 Non-Callable BB- 3,275,000 3,638,534
Ethan Allen, Inc. 8.75 3/15/2001 1998 @ 101.46 BB 1,965,000 1,974,825
Foodmaker, Inc. 9.25 3/01/1999 1997 @ 102.64 BB- 1,965,000 1,856,009
Kaufman & Broad Home Corporation 9.375 5/01/2003 2000 @ 100 BB- 1,965,000 1,960,087
Manor Care, Inc. 9.50 11/15/2002 1997 @ 103.56 BB+ 1,310,000 1,398,459
Maxus Energy Corporation 9.50 2/15/2003 2000 @ 100 BB 3,275,000 3,214,872
Owens-Illinois, Incorporated 9.75 8/15/2004 1997 @ 104.88 B+ 3,275,000 3,396,531
PanAMSat L.P. 9.75 8/01/2000 1998 @ 101.63 B+ 2,620,000 2,764,576
Revco D.S., Inc. 9.125 1/15/2000 1998 @ 103 BB 1,310,000 1,364,995
Safeway Inc. 9.65 1/15/2004 Non-Callable B+ 1,965,000 2,165,020
Service Merchandise Company, Inc. 9.00 12/15/2004 2003 @ 100 S.F. BB- 3,275,000 2,712,584
1997 @ 104.5
Southern Pacific Rail Corporation 9.375 8/15/2005 1998 @ 104.17 B+ 3,275,000 3,559,477
Stop & Shop Companies 9.75 2/01/2002 Non-Callable BB- 1,310,000 1,432,035
The Kroger Company 8.50 6/15/2003 1998 @ 104.25 BB- 1,310,000 1,370,025
The Southland Corporation 4.50 6/15/2004 1996 @ 100 BB+ 3,930,000 3,060,487
The Vons Companies, Inc. 8.375 10/01/1999 1997 @ 100 BB- 1,310,000 1,327,817
Transco Energy Company 9.625 6/15/2000 Non-Callable B 1,965,000 2,082,921
Unisys Corporation 10.625 10/01/1999 1997 @ 101.77 BB- 1,965,000 1,822,798
United Air Lines, Inc. 9.00 12/15/2003 Non-Callable BB 1,310,000 1,411,806
U.S. Treasury Securities (5) 0.00 11/15/2003 1,637,500 1,057,694
----------- -----------
$62,552,500 $59,959,200
=========== ===========
</TABLE>
[FN]
See accompanying notes to Schedule of Investments.
<PAGE>
Kemper Defined Funds
Corporate Income Series 1
Notes to Schedule of Investments
1. All ratings are by Standard & Poor's Corporation, unless marked with the
symbol "*", in which case the rating is by Moody's Investors Service, Inc.
The symbol "NR" indicates Bonds for which no rating is available.
Standard & Poor's Corporation states, "Bonds rated BB, B, CCC and CC are
regarded, on balance, as predominantly speculative with respect to capacity to
pay interest and repay principal in accordance with the terms of the
obligation. Within this range of ratings, BB indicates the lowest degree of
speculation and CC the highest degree of speculation. While such bonds will
likely have some quality and protective characteristics, these are outweighed
by large uncertainties or major risk exposures to adverse conditions.
2. There is shown under this heading the year in which each issue of Bonds is
initially redeemable and the redemption price for that year or, if currently
redeemable, the redemption price for that year or, if currently redeemable,
the redemption price currently in effect; unless otherwise indicated, each
issue continues to be redeemable at declining prices thereafter, but not below
par value. The prices at which the Bonds may be redeemed or called prior to
maturity may or may not include a premium and, in certain cases, may be less
than the cost of the Bonds to the Trust. In addition, certain Bonds in the
Portfolio may be redeemed in whole or in part other than by operation of the
stated redemption provisions under certain unusual or extraordinary
circumstances specified in the instruments setting forth the terms and
provisions of such Bonds.
3. See Note 1 to the accompanying financial statements for a description of
the method of determining cost and value.
4. At December 31, 1995, the Portfolio of the Trust consists of 25 corporate
debt obligations and 1 U.S. Treasury Security. Approximately 71% of the
aggregate principal amount of Bonds in the Trust are subject to call by the
issuers within five years after December 31, 1995.
5. These Bonds have been purchased at a discount from the par value because
there is no stated interest income thereon. Such Bonds are normally described
as "zero coupon" Bonds. Over the lives of the Bonds the values increase, so
that upon maturity, the holders of the Bonds will receive 100% of the
principal amount thereof.
[FN]
See accompanying notes to financial statements.
<PAGE>
Kemper Defined Funds
Corporate Income Series 1
Notes to Financial Statements
1. Significant Accounting Policies
Trust Sponsor and Evaluator
From the Trust's date of deposit through September 14, 1995, the Trust's
sponsor and evaluator was Kemper Unit Investment Trusts, a division of Kemper
Securities, Inc. At that date, the members of certain Kemper Corporation
operating units acquired ownership of certain Kemper units, which included
Kemper Securities, Inc. In connection with the acquisition, Kemper
Securities, Inc. changed its name to EVEREN Securities, Inc., and Kemper Unit
Investment Trusts became EVEREN Unit Investment Trusts, which now serves as
the "Evaluator" and sponsor of the Trust. Subsequent to the date of
acquisition, neither EVEREN Securities, Inc. nor EVEREN Unit Investment Trusts
is affiliated with Kemper Financial Services, Inc. or Kemper Corporation.
Valuation of Securities
Corporate Securities and the zero coupon obligations are stated at bid prices
as determined by EVEREN Unit Investment Trusts. The aggregate bid prices of
the Securities are determined based on (a) current bid prices of the
Securities, (b) current bid prices for comparable securities, (c) appraisal,
or (d) any combination of the above.
Cost of Securities
Cost of the Trust's Securities is based on the offering prices of the
Securities on the dates of deposit of such Securities acquired during the
primary sales period, plus amortization of original issue discount for zero
coupon obligations. The premium or discount for the fixed rate obligations is
not being amortized. Realized gain (loss) from Security transactions is
reported on an identified cost basis.
Investment Income
Interest income consists of amortization of original issue discount on the
zero coupon obligations and interest accrued as earned on the fixed rate
obligations.
2. Unrealized Appreciation and Depreciation
Following is an analysis of net unrealized depreciation at December 31, 1995:
<TABLE>
<CAPTION>
<S> <C>
Gross unrealized depreciation $(1,663,640)
Gross unrealized appreciation 969,139
------------
Net unrealized depreciation $(694,501)
============
</TABLE>
<PAGE>
Kemper Defined Funds
Corporate Income Series 1
Notes to Financial Statements (continued)
3. Transactions with Affiliates
Investors Fiduciary Trust Company (IFTC), who served as Trustee through
February 29, 1996, was 50% owned by Kemper Financial Services, Inc., an
affiliate of Kemper Unit Investment Trusts until January 31, 1995, at which
time State Street Boston Corporation acquired Investors Fiduciary Trust
Company. Payments to the Trustee included $.949, $.89 and $.89 of the
Trustee's annual fee per $1,000 principal amount of underlying Securities in
the Trust at December 31, 1995, 1994 and 1993, respectively, calculated
monthly, based on the largest aggregate principal amount of Securities in the
Trust at any time during the month and reimbursement of out-of-pocket expenses
of $.15 per 100 Units through December 31, 1995, calculated monthly, based on
the largest number of Trust Units outstanding at any time during the month.
The annual Evaluator's fee and portfolio surveillance fee, calculated monthly,
are $.30 and $.25, respectively, per $1,000 principal amount of Securities in
the Trust based on the largest aggregate principal amount of Securities in the
Trust at any time during the month.
4. Federal Income Taxes
The Trust is not an association taxable as a corporation for federal income
tax purposes. Each Unitholder is considered to be the owner of a pro rata
portion of the Trust under Subpart E, Subchapter J of Chapter 1 of the
Internal Revenue Code of 1986, as amended. Accordingly, no provision has been
made for federal income taxes.
5. Other Information
Cost to Investors
The cost to initial investors of Units of the Trust was based on the aggregate
offering price of the Securities on the date of an investor's purchase, plus
or minus a pro rata share of cash or overdraft in the Principal Account,
purchased interest and daily accrued interest, plus a sales charge of 3.9% of
the Public Offering Price (equivalent to 4.058% of the net amount invested).
The Public Offering Price for secondary market transactions is based on the
aggregate bid prices of the Securities plus or minus a pro rata share of cash
or overdraft in the Principal Account, purchased interest and daily accrued
interest on the date of an investor's purchase, plus a sales charge of 4.5% of
the Public Offering Price (equivalent to 4.712% of the net amount invested).
<PAGE>
<TABLE>
Kemper Defined Funds
Corporate Income Series 1
Notes to Financial Statements (continued)
5. Other Information (continued)
Selected data per Unit of the Trust outstanding during each period (amounts
relating to net investment income are based on weighted average Units
outstanding) -
<CAPTION>
Period from
Nov. 3,
1993 to
Year ended Dec. 31 Dec. 31,
1995 1994 1993
<S> <C> <C> <C>
----- ----- -----
Investment income - interest $.88 $.87 $.20
Expenses .02 .02 .01
----- ----- -----
Net investment income .86 .85 .19
Distributions to Unitholders:
Net investment income (.82) (.82) (.05)
Principal from investment transactions - (.02) -
----- ----- -----
Total distributions to Unitholders (.82) (.84) (.05)
Net gain (loss) on investments .78 (.97) (.18)
----- ----- -----
Change in net asset value .82 (.96) (.04)
Net asset value:
Beginning of the period 8.92 9.88 9.92*
----- ----- -----
End of the period, including
distributable funds $9.74 $8.92 $9.88
===== ===== =====
</TABLE>
[FN]
*Value at Date of Initial Deposit (November 3, 1993).
6. Change of Trustee
On March 1, 1996, The Bank of New York assumed all trustee responsibilities
from IFTC.
<PAGE>
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Independent
Auditors" and to the use of our report dated April 15, 1996, in this Post-
Effective Amendment to the Registration Statement (Form S-6) and related
Prospectus of Kemper Defined Funds Corporate Income Series 1 dated April 29,
1996.
Ernst & Young LLP
Kansas City, Missouri
April 29, 1996
<PAGE>
Contents of Post-Effective AmendmentTo Registration Statement
This Post-Effective amendment to the Registration Statement
comprises the following papers and documents:
The facing sheet
The prospectus
The signatures
The Consent of Independent Accountants
<PAGE>
Signatures
Pursuant to the requirements of the Securities Act of 1933, The
Registrant, Kemper Defined Funds Series 9, certifies that it
meets all of the requirements for effectiveness of this
registration statement pursuant to Rule 485(b) under the
Securities Act of 1933 and has duly caused this Amendment to the
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Chicago,
and State of Illinois, on the 28th day of April, 1996.
Kemper Defined Funds Series 9
Registrant
By: EVEREN Unit Investment Trusts
(a division of EVEREN Securities, Inc.)
Depositor
By: Michael J. Thoms
Vice President
Pursuant to the requirements of the Securities Act of 1933, this
Amendment to the Registration Statement has been signed below on
April 28, 1996 by the following persons, who constitute a
majority of the Board of Directors of EVEREN Securities, Inc.
Signature Title
James R. Boris Chairman and Chief Executive Officer
James R. Boris
Daniel D. Williams Senior Executive Vice President, Chief
Daniel D. Williams Financial Officer and Treasurer
Frank V. Geremia Senior Executive Vice President
Frank V. Geremia
Stephen G. McConahey President and Chief Operating Officer
Stephen G. McConahey
Stanley R. Fallis Senior Executive Vice President and Chief
Stanley R. Fallis Administrative Officer
David M. Greene Senior Executive Vice President and
David M. Greene Director of Client Services
Thomas R. Reedy Senior Executive Vice President and
Thomas R. Reedy Director of Capital Markets
Janet L. Reali Executive Vice President, Corporate Counsel
Janet L. Reali and Corporate Secretary
Michael J. Thoms
Michael J. Thoms signs this document pursuant to a Power of
Attorney filed with the Securities and Exchange Commission with
Amendment No. 1 to the Registration Statement on Form S-6 for
Kemper Defined Funds Series 28 (Registration No. 33-56779).
<TABLE> <S> <C>
<ARTICLE> 6
<LEGEND>
This schedule contains summary financial information extracted from
Post-effective Amendment Number 2 to Form S-6 and is qualified in
its entirety by reference to such Post-effective Amendment to Form S-6.
</LEGEND>
<SERIES>
<NUMBER> 1
<NAME> KEMPER DEFINED FUNDS CORPORATE INCOME SERIES
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<INVESTMENTS-AT-COST> 60,653,701
<INVESTMENTS-AT-VALUE> 59,959,200
<RECEIVABLES> 1,331,982
<ASSETS-OTHER> 0
<OTHER-ITEMS-ASSETS> 0
<TOTAL-ASSETS> 61,291,182
<PAYABLE-FOR-SECURITIES> 0
<SENIOR-LONG-TERM-DEBT> 0
<OTHER-ITEMS-LIABILITIES> 361,462
<TOTAL-LIABILITIES> 361,462
<SENIOR-EQUITY> 0
<PAID-IN-CAPITAL-COMMON> 61,197,907
<SHARES-COMMON-STOCK> 6,255,250
<SHARES-COMMON-PRIOR> 6,255,250
<ACCUMULATED-NII-CURRENT> 426,314
<OVERDISTRIBUTION-NII> 0
<ACCUMULATED-NET-GAINS> 0
<OVERDISTRIBUTION-GAINS> 0
<ACCUM-APPREC-OR-DEPREC> (694,501)
<NET-ASSETS> 60,929,720
<DIVIDEND-INCOME> 0
<INTEREST-INCOME> 5,480,595
<OTHER-INCOME> 0
<EXPENSES-NET> 110,708
<NET-INVESTMENT-INCOME> 5,369,887
<REALIZED-GAINS-CURRENT> 0
<APPREC-INCREASE-CURRENT> 4,926,085
<NET-CHANGE-FROM-OPS> 10,295,972
<EQUALIZATION> 0
<DISTRIBUTIONS-OF-INCOME> (5,131,869)
<DISTRIBUTIONS-OF-GAINS> 0
<DISTRIBUTIONS-OTHER> 0
<NUMBER-OF-SHARES-SOLD> 0
<NUMBER-OF-SHARES-REDEEMED> 0
<SHARES-REINVESTED> 0
<NET-CHANGE-IN-ASSETS> 5,164,103
<ACCUMULATED-NII-PRIOR> 424,306
<ACCUMULATED-GAINS-PRIOR> 0
<OVERDISTRIB-NII-PRIOR> 0
<OVERDIST-NET-GAINS-PRIOR> 0
<GROSS-ADVISORY-FEES> 0
<INTEREST-EXPENSE> 0
<GROSS-EXPENSE> 0
<AVERAGE-NET-ASSETS> 0
<PER-SHARE-NAV-BEGIN> 0
<PER-SHARE-NII> 0
<PER-SHARE-GAIN-APPREC> 0
<PER-SHARE-DIVIDEND> 0
<PER-SHARE-DISTRIBUTIONS> 0
<RETURNS-OF-CAPITAL> 0
<PER-SHARE-NAV-END> 0
<EXPENSE-RATIO> 0
<AVG-DEBT-OUTSTANDING> 0
<AVG-DEBT-PER-SHARE> 0
</TABLE>
