File No: 33-
CIK #897002
Securities and Exchange Commission
Washington, D.C. 20549-1004
Form S-6
For Registration under the Securities Act of 1933 of Securities of Unit
Investment Trusts Registered on Form N-8B-2.
A. Exact name of Trust: Van Kampen American Capital Equity
Opportunity Trust, Series 36
B. Name of Depositor: Van Kampen American Capital
Distributors, Inc.
C. Complete address of Depositor's principal executive offices:
One Parkview Plaza
Oakbrook Terrace Illinois 60181
D. Name and complete address of agents for service:
Van Kampen American Capital
Chapman And Cutler Distributors, Inc.
Attention: Mark J. Kneedy Attention: Don G. Powell, Chairman
111 West Monroe Street One Parkview Plaza
Chicago, Illinois 60603 Oakbrook Terrace, Illinois 60181
E. Title and amount of securities being registered: Units of undivided
fractional beneficial interests
F. Proposed maximum offering price to the public of the securities being
registered: Indefinite
G. Amount of registration fee: $500.00
H. Approximate date of proposed sale to the public:
As Soon As Practicable After The Effective Date Of The Registration
Statement
______________________________________________________________________
The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the
registrant shall file a further amendment which specifically states that
this Registration Statement shall thereafter become effective in
accordance with Section 8(a) of the Securities Act of 1933 or until the
Registration Statement shall become effective on such date as the
Commission, acting pursuant to said Section 8(a) may determine.
Van Kampen American Capital Equity Opportunity Trust
Series 36
Cross Reference Sheet
Pursuant to Rule 404(c) of Regulation C
under the Securities Act of 1933
(Form N-8B-2 Items Required by Instruction
1 as to Prospectus on Form S-6)
Form N-8B-2 Form S-6
Item Number Heading in Prospectus
I. Organization and General Information
1. (a) Name of trust ) Prospectus Front Cover Page
(b) Title of securities issued ) Prospectus Front Cover Page
2. Name and address of Depositor ) Summary of Essential Financial
) Information
) Trust Administration
3. Name and address of Trustee ) Summary of Essential Financial
) Information
) Trust Administration
4. Name and address of principal ) Trust Administration
underwriter
5. Organization of trust ) The Trust
6. Execution and termination of ) The Trust
Trust Indenture and Agreement ) Trust Administration
7. Changes of Name ) *
8. Fiscal year ) *
9. Material Litigation ) *
II. General Description of the Trust and
Securities of the Trust
10. General information regarding ) The Trust
trust's securities and ) Federal Taxation
rights of security holders ) Public Offering
) Rights of Unitholders
) Trust Administration
) Risk Factors
11. Type of securities comprising ) Prospectus Front Cover Page
units ) The Trust
) Trust Portfolio
) Risk Factors
12. Certain information regarding ) *
periodic payment certificates )
13. (a) Loan, fees, charges and expenses) Prospectus Front Cover
Page
) Summary of Essential Financial
) Information
) Trust Portfolio
)
) Trust Operating Expenses
) Public Offering
) Rights of Unitholders
(b) Certain information regarding )
periodic payment plan ) *
certificates )
(c) Certain percentages ) Prospectus Front Cover Page
) Summary of Essential Financial
) Information
)
) Public Offering
) Rights of Unitholders
(d) Certain other fees, expenses or ) Trust Operating
Expenses
charges payable by holders ) Rights of Unitholders
(e) Certain profits to be received) Public Offering
by depositor, principal ) Trust Portfolio
underwriter, trustee or any )
affiliated persons )
(f) Ratio of annual charges ) *
to income )
14. Issuance of trust's securities ) Rights of Unitholders
15. Receipt and handling of payments ) *
from purchasers )
16. Acquisition and disposition of ) The Trust
underlying securities ) Rights of Unitholders
) Trust Administration
17. Withdrawal or redemption ) Rights of Unitholders
) Trust Administration
18. (a) Receipt and disposition ) Prospectus Front Cover Page
of income ) Rights of Unitholders
(b) Reinvestment of distributions ) *
(c) Reserves or special funds ) Trust Operating Expenses
) Rights of Unitholders
(d) Schedule of distributions ) *
19. Records, accounts and reports ) Rights of Unitholders
) Trust Administration
20. Certain miscellaneous provisions ) Trust Administration
of Trust Agreement )
21. Loans to security holders ) *
22. Limitations on liability ) Trust Portfolio
) Trust Administration
23. Bonding arrangements ) *
24. Other material provisions of ) *
Trust Indenture Agreement )
III. Organization, Personnel and Affiliated
Persons of Depositor
25. Organization of Depositor ) Trust Administration
26. Fees received by Depositor ) *
27. Business of Depositor ) Trust Administration
28. Certain information as to ) *
officials and affiliated )
persons of Depositor )
29. Companies owning securities ) *
of Depositor )
30. Controlling persons of Depositor ) *
31. Compensation of Officers of ) *
Depositor )
32. Compensation of Directors ) *
33. Compensation to Employees ) *
34. Compensation to other persons ) *
IV. Distribution and Redemption of Securities
35. Distribution of trust's securities) Public Offering
by states )
36. Suspension of sales of trust's ) *
securities )
37. Revocation of authority to ) *
distribute )
38. (a) Method of distribution )
)
(b) Underwriting agreements ) Public Offering
)
(c) Selling agreements )
39. (a) Organization of principal ) *
underwriter )
(b) N.A.S.D. membership by ) *
principal underwriter )
40. Certain fees received by ) *
principal underwriter )
41. (a) Business of principal ) Trust Administration
underwriter )
(b) Branch offices or principal ) *
underwriter )
(c) Salesmen or principal ) *
underwriter )
42. Ownership of securities of ) *
the trust )
43. Certain brokerage commissions ) *
received by principal underwriter)
44. (a) Method of valuation ) Prospectus Front Cover Page
) Summary of Essential Financial
) Information
) Trust Operating Expenses
) Public Offering
(b) Schedule as to offering ) *
price )
(c) Variation in offering price ) *
to certain persons )
46. (a) Redemption valuation ) Rights of Unitholders
) Trust Administration
(b) Schedule as to redemption ) *
price )
47. Purchase and sale of interests ) Public Offering
in underlying securities ) Trust Administration
V. Information Concerning the Trustee or Custodian
48. Organization and regulation of ) Trust Administration
Trustee )
49. Fees and expenses of Trustee ) Summary of Essential Financial
) Information
) Trust Operating Expenses
50. Trustee's lien ) Trust Operating Expenses
VI. Information Concerning Insurance of Holders of Securities
51. Insurance of holders of trust's )
securities ) *
52. (a) Provisions of trust agreement)
with respect to replacement) Trust Administration
or elimination portfolio )
securities )
(b) Transactions involving )
elimination of underlying ) *
securities )
(c) Policy regarding substitution )
or elimination of underlying ) Trust Administration
securities )
(d) Fundamental policy not ) *
otherwise covered )
53. Tax Status of trust ) Federal Taxation
VII. Financial and Statistical Information
54. Trust's securities during ) *
last ten years )
55. )
56. Certain information regarding ) *
57. periodic payment certificates )
58. )
59. Financial statements (Instructions) Report of Independent
Certified
1(c) to Form S-6) ) Public Accountants
) Statement of Condition
______________________________________________
* Inapplicable, omitted, answer negative or not required
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This Prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these
securities in any State in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such State.
Preliminary Prospectus Dated June 27, 1996
Subject to Completion
July 26, 1996
Van Kampen American Capital
Van Kampen American Capital Equity Opportunity Trust, Series 36
Van Kampen American Capital Blue Chip Opportunity and Treasury Trust, Series 4
The Fund. Van Kampen American Capital Equity Opportunity Trust, Series 36 (the
"Fund") is comprised of one unit investment trust, Van Kampen American
Capital Blue Chip Opportunity and Treasury Trust, Series 4 (the "Trust").
The Trust offers investors the opportunity to purchase Units representing
proportionate interests in a fixed, diversified portfolio of the 30 actively
traded "blue chip" equity securities which currently are components of
the Dow Jones Industrial Average* plus "zero coupon" U.S. Treasury
obligations. Dow Jones & Company, Inc. has not participated in any way in the
creation of the Trust or in the selection of stocks included in the Trust and
has not approved any information herein relating thereto. Unless terminated
earlier, the Trust will terminate on February 15, 2008 and any Securities then
held will, within a reasonable time thereafter, be liquidated or distributed
by the Trustee. Any Securities liquidated at termination will be sold at the
then current market value for such Securities; therefore, the amount
distributable in cash to a Unitholder upon termination may be more or less
than the amount such Unitholder paid for his Units.
Attention Foreign Investors. If you are not a United States citizen or
resident, distributions from the Trust will generally be subject to U.S.
Federal withholding taxes; however, under certain circumstances treaties
between the United States and other countries may reduce or eliminate such
withholding tax. See "Taxation." Such investors should consult their
tax advisers regarding the imposition of U.S. withholding on distributions.
Objectives of the Trust. The objectives of the Trust are to provide the
potential for capital appreciation and income, consistent with the
preservation of invested capital, by investing in a portfolio of actively
traded, New York Stock Exchange listed equity securities which currently are
components of the Dow Jones Industrial Average* ("Equity Securities")
and to protect Unitholders' capital by investing a portion of its portfolio in
"zero coupon" U.S. Treasury obligations ("Treasury Obligations").
Collectively, the Treasury Obligations and the Equity Securities are
referred to herein as the "Securities." See "Portfolio." There
is, of course, no guarantee that the objectives of the Trust will be achieved.
Public Offering Price. The Public Offering Price of the Units of the Trust
during the initial offering period includes the aggregate underlying value of
the Equity Securities and the aggregate offering price of the Treasury
Obligations in the Trust's portfolio, a sales charge equal to 4.9% of the
Pubic Offering Price (which is equivalent to 5.152% of the aggregate value of
the Securities), and cash, if any, in the Income and Capital Accounts held or
owned by the Trust." During the initial offering period, the sales charge
is reduced on a graduated scale for sales involving at least 5,000 Units. If
Units were available for purchase at the close of business on the day before
the Initial Date of Deposit, the Public Offering Price per Unit would have
been $XXX. For sales charges in the secondary market, see "Public
Offering." The minimum purchase is 100 Units except for certain
transactions described under "Public Offering--Unit Distribution". See
"Public Offering. Units are not designed so that their prices will
parallel or correlate with movements in the Dow Jones Industrial Average, and
it is expected that their prices will not parallel or correlate with such
movements. The Treasury Obligations evidence the right to receive a fixed
payment at a future date from the U.S. Government and are backed by the full
faith and credit of the U.S. Government. The guarantee of the U.S. Government
does not apply to the market value of the Treasury Obligations or the Units of
the Trust, whose net asset value will fluctuate and may be worth more or less
than a purchaser's acquisition cost. It is anticipated that upon maturity the
Treasury Obligations will represent an amount of at least $11.00 per Unit.
Units of the Trust are not deposits or obligations of, or guaranteed or
endorsed by, any bank and are not federally insured or otherwise protected by
the Federal Deposit Insurance Corporation, the Federal Reserve Board or any
other agency and involve investment risk, including the loss of the principal
amount invested.
Principal Protection. The Trust has been organized so that purchasers of Units
should receive, at the termination of the Trust, an amount per Unit at least
equal to $11.00 (which is equal to the per Unit value upon maturity of the
Treasury Obligations), even if the Trust never paid a dividend and the value
of the Equity Securities were to decrease to zero, which the Sponsor considers
highly unlikely. This feature of the Trust provides Unitholders who purchase
Units at the price of $11.00 or less per Unit with total principal protection,
including any sales charges paid, although they might forego any earnings on
the amount invested. To the extent that Units are purchased at a price less
than $11.00 per Unit, this feature may also provide a potential for capital
appreciation.
The Treasury Obligations will mature on February 15, 2008. The Treasury
Obligations have a maturity value equal to or greater than the aggregate
Public Offering Price (which includes the sales charge) of the Units of the
Trust on the Initial Date of Deposit; however, the value of the Treasury
Obligations may fluctuate before maturity due to fluctuations in interest
rates. The Equity Securities deposited in the Trust's portfolio have no fixed
maturity date and the value of these underlying Equity Securities will
fluctuate with changes in the values of stocks in general and with changes in
the conditions and performance of the specific Securities owned by the Trust.
See "Trust Portfolio."
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.
* The Dow Jones Industrial Average is the property of Dow Jones & Company,
Inc. Dow Jones & Company, Inc. has not granted to the Trust of the Sponsor a
license to use the Dow Jones Industrial Average.
Additional Deposits. The Sponsor may, from time to time during a period of up
to approximately 12 months after the Initial Date of Deposit, deposit
additional Securities in the Trust as provided under "The Trust."
Dividend and Capital Distributions. Distributions of dividends and realized
capital, if any, received by the Trust will be paid in cash on the applicable
Distribution Date to Unitholders of record on the record date as set forth in
the "Summary of Essential Financial Information." The initial
estimated distribution will be $XX per Unit and will be made on XXXXXXX 25,
1996 to Unitholders of record on XXXXXXX 10, 1996. Income with respect to the
amortization of original issue discount on the Treasury Obligations in the
Blue Chip Opportunity and Treasury Trust will not be distributed currently,
although Unitholders will be subject to income tax at ordinary income rates as
is a distribution had occurred. Gross dividends received by the Trust will be
distributed to Unitholders. Expenses of the Trust will be paid with proceeds
from the sale of Securities. For the consequences of such sales, see
"Federal Taxation" and "Risk Factors." Additionally, upon
termination of the Trust, the Trustee will distribute, upon surrender of Units
for redemption, to each Unitholder his pro rata share of the Trust's assets,
less expenses, in the manner set forth under "Rights of
Unitholders--Distributions of Income and Capital."
Secondary Market for Units. After the initial offering period, although not
obligated to do so, the Sponsor intends to maintain a market for Units of the
Trust and offer to repurchase such Units at prices which are based on the
aggregate underlying value of Equity Securities in the Trust (generally
determined by the closing sale or bid prices of the Securities) plus the
aggregate bid side evaluation of the Treasury Obligations, plus or minus cash,
if any, in the Capital and Income Accounts of the Trust. If a secondary market
is maintained during the initial offering period, the prices at which Units
will be repurchased will be based upon the aggregate underlying value of the
Securities in the Trust (generally determined by the closing sale or asked
prices of the Equity Securities and the aggregate offer side evaluation of the
Treasury Obligations) plus or minus cash, if any, in the Capital and Income
Accounts of the Trust. If a secondary market is not maintained, a Unitholder
may redeem Units through redemption at prices based upon the aggregate
underlying value of the Equity Securities in the Trust plus the aggregate bid
side evaluation of the Treasury Obligations, plus or minus a pro rata share of
cash, if any, in the Capital and Income Accounts of the Trust. A Unitholder
tendering 1,000 or more Units for redemption may request a distribution of
shares of Equity Securities (reduced by customary transfer and registration
charges) in lieu of payment in cash. All Unitholders will receive their pro
rata portion of the Treasury Obligations in cash upon redemption. See "
"Rights of Unitholders--Redemption of Units."
Termination. Commencing on the Mandatory Termination Date Equity Securities
will begin to be sold in connection with the termination of the Trust. The
Sponsor will determine the manner, timing and execution of the sale of the
Equity Securities. Written notice of any termination of the Trust specifying
the time or times at which Unitholders may surrender their certificates for
cancellation shall be given by the Trustee to each Unitholder at his address
appearing on the registration books of the Trust maintained by the Trustee. At
least 30 days prior to the Mandatory Termination Date the Trustee will provide
written notice thereof to all Unitholders and will include with such notice a
form to enable Unitholders to elect a distribution of shares of Equity
Securities if such Unitholder owns at least 1,000 Units of the Trust, rather
than to receive payment in cash for such Unitholder's pro rata share of the
amounts realized upon the disposition by the Trustee of Equity Securities. All
Unitholders will receive cash in lieu of any fractional shares and cash
representing their pro rata portion of the Treasury Obligations. To be
effective, the election form, together with surrendered certificates if
issued, and other documentation required by the Trustee, must be returned to
the Trustee at least five business days prior to the Mandatory Termination
Date. Unitholders not electing a distribution of shares of Equity Securities
will receive a cash distribution from the sale of the remaining Securities
within a reasonable time after the Trust is terminated. See "Trust
Administration--Amendment or Termination."
Reinvestment Option. Unitholders of any Van Kampen American Capital-sponsored
unit investment trust may utilize their redemption or termination proceeds to
purchase units of any other Van Kampen American Capital trust in the initial
offering period accepting rollover investments subject to a reduced sales
charge to the extent stated in the related prospectus (which may be deferred
in certain cases). Unitholders also have the opportunity to have their
distributions reinvested into an open-end management investment company as
described herein. See "Rights of Unitholders--Reinvestment Option."
Risk Factors. An investment in the Trust should be made with an understanding
of the risks associated therewith, including the possible deterioration of
either the financial condition of the issuers, the general condition of the
stock market and volatile interest rates. See "Risk Factors" and "
Trust Portfolio."
<TABLE>
VAN KAMPEN AMERICAN CAPITAL EQUITY OPPORTUNITY TRUST, SERIES 36
Summary of Essential Financial Information
At the Close of Business on the day before the Initial Date of Deposit: July 25, 1996
Sponsor: Van Kampen American Capital Distributors, Inc.
Supervisor: Van Kampen American Capital Investment Advisory Corp.
(An affiliate of the Sponsor)
Evaluator: American Portfolio Evaluation Services
(A division of an affiliate of the Sponsor)
Trustee: The Bank of New York
<CAPTION>
General Information
<S> <C>
Aggregate Maturity Value of Treasury Obligations Initially Deposited...................
Number of Units........................................................................
Fractional Undivided Interest in the Trust per Unit....................................
Public Offering Price: ................................................................
Aggregate Value of Securities in Portfolio <F1>....................................... $
Aggregate Value of Securities per Unit ............................................... $
Sales Charge 4.9% (5.152% of the Aggregate Value of Securities per Unit).............. $
Public Offering Price Per Unit <F2><F3>............................................... $
Redemption Price per Unit <F3>......................................................... $
Secondary Market Repurchase Price per Unit............................................. $
Excess of Public Offering Price per Unit over Maximum Redemption Price per Unit........ $
Excess of Sponsor's Initial Repurchase Price per Unit over Redemption Price per Unit...
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
Supervisor's Annual Supervisory Fee... Maximum of $.0025 per Unit
Evaluator's Annual Evaluation Fee..... Maximum of $.0025 per Unit
Evaluation Time....................... 4:00 P.M. New York time
Mandatory Termination Date............ February 15, 2008
Minimum Termination Value............. The Trust may be terminated if the net asset value of the Trust is less than
$500,000 unless the net asset value of the Trust deposits has exceeded $15,000,000,
then the Trust Agreement may be terminated if the net asset value of the Trust is
less than $3,000,000.
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
Estimated Annual Dividends per Unit <F4>............................................... $
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
Trustee's Annual Fee................ $.008 per Unit
Estimated Annual Organizational
Expenses <F5>...................... $XXXX per Unit
Income Distribution Record Date..... Tenth day of September, December, March and June
Income Distribution Date............ Twenty-fifth of September, December, March and June
Capital Account Record Date......... Tenth day of December
Capital Account Distribution Date... Twenty-fifth day of December
<FN>
<F1>Each Equity Security listed on a national securities exchange is valued at the
closing sale price or, if the Equity Security is not listed, at the closing
ask price thereof. The Treasury Obligations are valued at the offering side
evaluation.
<F2>On the Initial Date of Deposit there will be no cash in the Income or Capital
Accounts. Anyone ordering Units after such date will have included in the
Public Offering Price a pro rata share of any cash in such Accounts.
<F3>Effective on each July 26, commencing July 26, 1997, the secondary market
sales charge will decrease by .3 of 1% to a minimum sales charge of 1.5%. See
"Public Offering."
<F4>Estimated annual dividends are based on annualizing the most recently declared
dividends. Estimated Annual Dividends per Unit are based on the number of
Units, the fractional undivided interest in the Securities per Unit and the
aggregate value of the Securities per Unit as of the Initial Date of Deposit.
Investors should note that the actual annual dividends received per Unit will
vary from the estimated amount due to changes in the factors described in the
preceding sentence and actual dividends declared and paid by the issuers of
the Securities.
<F5>The Trust (and therefore Unitholders) will bear all or a portion of its
organizational costs (including costs of preparing the registration statement,
the trust indenture and other closing documents, registering Units with the
Securities and Exchange Commission and states, the initial audit of the
portfolio and the initial fees and expenses of the Trustee but not including
the expenses incurred in the preparation and printing of brochures and other
advertising material and any other selling expenses) as is common for mutual
funds. Total organizational expenses will be amortized over a five year
period. See "Trust Operating Expenses" and "Statement of
Condition." Historically, the sponsors of unit investment trusts have paid
all the costs of establishing such trusts. Estimated Annual Organizational
Expenses have been estimated based on a projected trust size of $XXXXXXX. To
the extent the Trust is larger or smaller, the actual organizational expenses
paid by the Trust (and therefore by Unitholders) will vary from the estimated
amount set forth above.
</TABLE>
THE TRUST
Van Kampen American Capital Equity Opportunity Trust, Series 36 is comprised
of one unit investment trust, Van Kampen American Capital Blue Chip
Opportunity Trust, Series 4. The Trust was created under the laws of the State
of New York pursuant to a Trust Indenture and Agreement (the "Trust
Agreement"), dated the date of this Prospectus (the "Initial Date of
Deposit"), among Van Kampen American Capital Distributors, Inc., as
Sponsor, American Portfolio Evaluation Services, a division of Van Kampen
American Capital Investment Advisory Corp., as Evaluator, Van Kampen American
Capital Investment Advisory Corp., as Supervisor, and The Bank of New York, as
Trustee.
The Trust may be an appropriate medium for investors who desire to participate
in a portfolio of equity securities and zero-coupon U.S. Treasury obligations
with greater diversification with regard to the industrial equity securities
than they might be able to acquire individually. Diversification of assets in
the Trust will not eliminate the risk of loss always inherent in the ownership
of securities. For a breakdown of the portfolio see "Trust Portfolio."
On the Initial Date of Deposit, the Sponsor deposited with the Trustee the
Securities indicated under "Portfolio" herein, including delivery
statements relating to contracts for the purchase of certain such Securities
and an irrevocable letter of credit issued by a financial institution in the
amount required for such purchases. Thereafter, the Trustee, in exchange for
such Securities (and contracts) so deposited, delivered to the Sponsor
documentation evidencing the ownership of that number of Units of the Trust
indicated in "Summary of Essential Financial Information." Unless
otherwise terminated as provided in the Trust Agreement, the Trust will
terminate on the Mandatory Termination Date, and Securities then held will
within a reasonable time thereafter be liquidated or distributed by the
Trustee.
Additional Units of the Trust may be issued at any time by depositing in the
Trust additional Securities of contracts to purchase securities together with
irrevocable letters of credit or cash. As additional Units are issued by the
Trust as a result of the deposit of additional Securities by the Sponsor, the
aggregate value of the Securities in the Trust will be increased and the
fractional undivided interest in the Trust represented by each Unit will be
decreased. The Sponsor may continue to make additional deposits of Securities
into the Trust for a period of up to 12 months following the Initial Date of
Deposit, provided that such additional deposits will be in amounts which will
maintain the same percentage relationship among the number of shares of each
Equity Security in the Trust and the same percentage relationship among the
number of shares of Equity Securities and the Treasury Obligations that
existed immediately prior to any such subsequent deposit. Such deposits of
additional Securities will, therefore, be done in such a manner that the
maturity value of the Treasury Obligations represented by each Unit should
always be an amount at least equal to $11.00. Thus, although additional Units
will be issued, each Unit will continue to represent approximately the same
number of shares and the percentage relationship among each Security in the
Trust will remain the same. The required percentage relationship among the
Securities will be adjusted to reflect the occurrence of a stock dividend, a
stock split or a similar event which affects the capital structure of the
issuer of a Security but which does not affect the Trust's percentage
ownership of the common stock equity of such issuer at the time of such event.
On a cost basis to the Trust, the original percentage relationship on the
Initial Date of Deposit was approximately XX% Treasury Obligations and
approximately XX% Equity Securities. Since the prices of the underlying
Treasury Obligations and Equity Securities will fluctuate daily, the ratio, on
a market value basis, will also change daily. The maturity value of the
Treasury Obligations and the portion of Equity Securities represented by each
Unit will not change as a result of the deposit of additional Securities in
the Trust.
Each Unit of the Trust initially offered represents an undivided interest in
the Trust. To the extent that any Units are redeemed by the Trustee or
additional Units are issued as a result of additional Securities being
deposited by the Sponsor, the fractional undivided interest in the Trust
represented by each unredeemed Unit will increase or decrease accordingly,
although the actual interest in the Trust 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.
OBJECTIVES AND SECURITIES SELECTION
The objectives of the Trust are to protect Unitholders' capital and provide
the potential for capital appreciation and income. The portfolio is described
below and in "Portfolio". The Trust has been organized so that
investors would receive, at termination, an amount per Unit at least equal to
$11.00 (which is equal to the per Unit value upon maturity of the Treasury
Obligations), even if the Trust never paid a distribution and the value of the
Equity Securities were to decrease to zero, which the Sponsor considers highly
unlikely. Any distributions of income will generally depend upon the
declaration of dividends by the issuers of the Securities and the declaration
of any dividends depends upon several factors including the financial
condition of the issuers and general economic conditions.
In selecting Securities for the Trust, the following factors, among others,
were considered: (a) for the portion of the Securities that are Equity
Securities, the Sponsor selected those Equity Securities that currently are
components of the Dow Jones Industrial Average and the dollar value of the
shares of such securities with the intent to have approximately equal dollar
amounts initially invested in each such security, and (b) for the portion of
the Securities that are Treasury Obligations, the evidence of the right to
receive a fixed payment at a future date from the U.S. Government, backed by
the full faith and credit of the U.S. Government.
The following chart shows the average annual compounded rate of return of
selected asset classes over a 25 year period ending December 31, 1994,
compared to the rate of inflation over the same period. Of course, this chart
represents past performance of these investment categories and there is no
guarantee of future results, either of these categories or of any Strategic
Ten Trust. The Trust also has sales charges and expenses which are not
reflected in the chart.
<TABLE>
<CAPTION>
Stocks (Dow
Jones Industrial
Average)
<S> <C>
25 yr 10.85%
</TABLE>
<TABLE>
<CAPTION>
Long-term U.S.
Government Bonds
<S> <C>
25 yr 8.60%
</TABLE>
<TABLE>
<CAPTION>
U.S. Treasury
bills (short
term)
<S> <C>
25 yr 6.80%
</TABLE>
<TABLE>
<CAPTION>
Consumer Price
Index
<S> <C>
25 yr 5.50%
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
0 2 4 6 8 10 12 14 16%
</TABLE>
Source: Ibbotson Associates
and Micropal, Inc.
An investor will be subject to taxation on the dividend income received from
the Trust and on gains from the sale or liquidation of Securities (see
"Federal Taxation"). Investors should be aware that there is not any
guarantee that the objectives of the Trust will be achieved because they are
subject to the continuing ability of the respective Security issuers to
continue to declare and pay dividends and because the market value of the
Securities can be affected by a variety of factors. Common stocks may be
especially susceptible to general stock market movements and to volatile
increases and decreases of value as market confidence in and perceptions of
the issuers change. Investors should be aware that there can be no assurance
that the value of the underlying Securities will increase or that the issuers
of the Equity Securities will pay dividends on outstanding common shares. Any
distributions of income will generally depend upon the declaration of
dividends by the issuers of the Securities and the declaration of any
dividends depends upon several factors including the financial condition of
the issuers and general economic conditions.
Investors should note that the above criteria were applied to the Securities
selected for inclusion in the Trust as of the Initial Date of Deposit.
Subsequent to the Initial Date of Deposit, the Securities may no longer meet
such criteria and the Equity Securities may no longer be included in the Dow
Jones Industrial Average. Should a Security no longer meet such criteria or
not be included in the Dow Jones Industrial Average, such Security will not,
simply as a result of such fact, be removed from the portfolio of the Trust.
Investors should be aware that the Trust is not a "managed" fund and
as a result the adverse financial condition of a company will not result in
its elimination from the portfolio except under extraordinary circumstances
(see "Trust Administration--Portfolio Administration"). In addition,
Securities will not be sold by the Trust to take advantage of market
fluctuations or changes in anticipated rates of appreciation. Investors should
note in particular that the Securities were selected by the Sponsor as of the
Initial Date of Deposit. The Trust may continue to purchase or hold Securities
originally selected through this process even though the evaluation of the
attractiveness of the Securities may have changed and, if the evaluation were
performed again at that time, the Securities would not be selected for the
Trust.
TRUST PORTFOLIO
The Trust consists of (a) 30 different issues of Equity Securities, all of
which are actively traded, blue-chip securities issued by large, well
established corporations and all of which, taken together, currently are
components of the Dow Jones Industrial Average. Each issue, as of the Initial
Date of Deposit, represented approximately the same dollar value of a
portfolio since the Sponsor utilized a dollar weighted average approach in
acquiring such Equity Securities and (b) zero-coupon U.S. Treasury
Obligations. Dow Jones & Company, Inc., owner of the Dow Jones Industrial
Average, has not granted to the Fund or the Sponsor a license to use the Dow
Jones Industrial Average. Units are not designed so that their prices will
parallel or correlate with movements in the Dow Jones Industrial Average, and
it is expected that their prices will not parallel or correlate with such
movements. Dow Jones & Company, Inc. has not participated in any way in the
creation of the Trust or in the selection of stocks included in the Trust and
has not approved any information herein relating thereto.
The Dow Jones Industrial Average is composed of 30 common stocks chosen by the
editors of The Wall Street Journal, a publication of Dow Jones & Company, Inc.
The companies are major factors in their industries and their stocks are
widely held by individuals and industrial investors. Changes in the components
are made entirely by the editors of The Wall Street Journal without
consultation with the companies, the stock exchange or any official agency.
Dow Jones & Company, Inc. expressly reserves the right to change the
components of the Dow Jones Industrial Average at any time for any reason. Any
changes in the components of the Dow Jones Industrial Average after the
Initial Date of Deposit will not cause a change in the identity of the common
stocks included in the Trust, including any additional Equity Securities
deposited in the Trust.
General. The Trust consists of (a) the Securities listed under
"Portfolio" as may continue to be held from time to time in the Trust, (b)
any additional Securities acquired and held by the Trust pursuant to the
provisions of the Trust Agreement and (c) any cash held in the Income and
Capital Accounts. Neither the Sponsor nor the Trustee shall be liable in any
way for any failure in any of the Securities. However, should any contract for
the purchase of any of the Securities initially deposited hereunder fail, the
Sponsor will, unless substantially all of the moneys held in the Trust to
cover such purchase are reinvested in substitute Securities in accordance with
the Trust Agreement, refund the cash and sales charge attributable to such
failed contract to all Unitholders on the next distribution date.
Because certain of the Equity Securities from time to time may be sold under
certain circumstances described herein, and because the proceeds from such
events will in most cases be distributed to Unitholders and will not be
reinvested, no assurance can be given that the Trust will retain for any
length of time its present size and composition. Although the portfolio is not
managed, the Sponsor may instruct the Trustee to sell Equity Securities under
certain limited circumstances. See "Trust Administration--Portfolio
Administration." Equity Securities, however, will not be sold by the Trust
to take advantage of market fluctuations or changes in anticipated rates of
appreciation or depreciation.
RISK FACTORS
Equity Securities. An investment in Units should be made with an understanding
of the risks which an investment in common stocks entails, including the risk
that the financial condition of the issuers of the Equity Securities or the
general condition of the common stock market may worsen and the value of the
Equity Securities and therefore the value of the Units may decline. Common
stocks are especially susceptible to general stock market movements and to
volatile increases and decreases of value as market confidence in and
perceptions of the issuers change. These perceptions are based on
unpredictable factors including expectations regarding government economic,
monetary and fiscal policies, inflation and interest rates, economic expansion
or contraction, global or regional political, economic or banking crises.
Shareholders of common stocks have rights to receive payments from the issuers
of those common stocks that are generally subordinate to those of creditors
of, or holders of debt obligations or preferred stocks of, such issuers.
Shareholders of common stocks of the type held by the Trust have a right to
receive dividends only when and if, and in the amounts, declared by the
issuer's board of directors and have a right to participate in amounts
available for distribution by the issuer only after all other claims on the
issuer have been paid or provided for. Certain of the issuers may currently be
in arrears with respect to preferred stock dividend payments. Common stocks do
not represent an obligation of the issuer and, therefore, do not offer any
assurance of income or provide the same degree of protection of capital as do
debt securities. The issuance of additional debt securities or preferred stock
will create prior claims for payment of principal, interest and dividends
which could adversely affect the ability and inclination of the issuer to
declare or pay dividends on its common stock or the rights of holders of
common stock with respect to assets of the issuer upon liquidation or
bankruptcy. The value of common stocks is subject to market fluctuations for
as long as the common stocks remain outstanding, and thus the value of the
Equity Securities in the portfolio may be expected to fluctuate over the life
of the Trust to values higher or lower than those prevailing on the Initial
Date of Deposit or at the time a Unitholder purchases Units.
Holders of common stocks incur more risk than holders of preferred stocks and
debt obligations because common stockholders, as owners of the entity, have
generally inferior rights to receive payments from the issuer in comparison
with the rights of creditors of, or holders of debt obligations or preferred
stocks issued by, the issuer. Cumulative preferred stock dividends must be
paid before common stock dividends and any cumulative preferred stock dividend
omitted is added to future dividends payable to the holders of cumulative
preferred stock. Preferred stockholders are also generally entitled to rights
on liquidation which are senior to those of common stockholders.
Whether or not the Equity Securities are listed on a national securities
exchange, the principal trading market for the Equity Securities may be in the
over-the-counter market. As a result, the existence of a liquid trading market
for the Equity Securities may depend on whether dealers will make a market in
the Equity Securities. There can be no assurance that a market will be made
for any of the Equity Securities, that any market for the Equity Securities
will be maintained or of the liquidity of the Equity Securities in any markets
made. In addition, the Trust may be restricted under the Investment Company
Act of 1940 from selling Equity Securities to the Sponsor. The price at which
the Equity Securities may be sold to meet redemptions, and the value of the
Trust, will be adversely affected if trading markets for the Equity Securities
are limited or absent.
As described under "Trust Operating Expenses," all of the expenses of
the Trust will be paid from the sale of Securities from the Trust. It is
expected that such sales will be made at the end of the initial offering
period and each month thereafter through termination of the Trust. Such sales
will result in capital gains and losses and may be made at times and prices
which adversely affect the Trust. For a discussion of the tax consequences of
such sales, see "Federal Taxation."
Unitholders will be unable to dispose of any of the Equity Securities in the
portfolio, as such, and will not be able to vote the Equity Securities. As the
holder of the Equity Securities, the Trustee will have the right to vote all
of the voting stocks in the Trust and will vote such stocks in accordance with
the instructions of the Sponsor. In the absence of any such instructions by
the Sponsor, the Trustee will vote such stocks so as to insure that the stocks
are voted as closely as possible in the same manner and the same general
proportion as are shares held by owners other than the Trust.
Treasury Obligations. The Treasury Obligations deposited in the Blue Chip
Opportunity and Treasury Trust consist of U.S. Treasury bonds which have been
stripped of their unmatured interest coupons. The Treasury Obligations
evidence the right to receive a fixed payment at a future date from the U.S.
Government and are backed by the full faith and credit of the U.S. Government.
Treasury Obligations are purchased at a deep discount because the buyer
obtains only the right to a fixed payment at a fixed date in the future and
does not receive any periodic interest payments. The effect of owning deep
discount bonds which do not make current interest payments (such as the
Treasury Obligations) is that a fixed yield is earned not only on the original
investment, but also, in effect on all earnings during the life of the
discount obligation. This implicit reinvestment of earnings at the same time
eliminates the risk of being unable to reinvest the income on such obligations
at a rate as high as the implicit yield on the discount obligation, but at the
same time eliminates the holder's ability to reinvest at higher rates in the
future. For this reason, the Treasury Obligations are subject to substantially
greater price fluctuations during periods of changing interest rates than are
securities of comparable quality which make regular interest payments. The
effect of being able to acquire the Treasury Obligations at a lower price is
to permit more of the Trust's portfolio to be invested in Equity Securities.
FEDERAL TAXATION
The following is a general discussion of certain of the federal income tax
consequences of the purchase, ownership and disposition of the Units. The
summary is limited to investors who hold the Units as "capital assets"
(generally, property held for investment) within the meaning of Section 1221
of the Internal Revenue 8 Code of 1986 (the "Code"). Unitholders
should consult their tax advisers in determining the federal, state, local and
any other tax consequences of the purchase, ownership and disposition of Units
in the Trust.
In the opinion of Chapman and Cutler, special counsel for the Sponsor, under
existing law:
1. The Trust is not an association taxable as a corporation for federal
income tax purposes; each Unitholder will be treated as the owner of a pro
rata portion of the assets of the Trust under the Code; and the income of the
Trust will be treated as income of the Unitholders thereof under the Code.
Each Unitholder will be considered to have received his pro rata share of
income derived from the Trust asset when such income is received by the Trust.
2. Each Unitholder will have a taxable event when the Trust disposes of a
Security (whether by sale, exchange, redemption, or payment at maturity) or
upon the sale or redemption of Units by such Unitholder. The price a
Unitholder pays for his Units, including sales charges, is allocated among his
pro rata portion of each Security held by the Trust (in proportion to the fair
market values thereof on the date the Unitholder purchases his Units) in order
to determine his initial cost for his pro rata portion of each Security held
by the Trust. The Treasury Obligations are treated as stripped bonds and may
be treated as bonds issued at an original issue discount as of the date a
Unitholder purchases his Units. Because the Treasury Obligations represent
interests in "stripped" U.S. Treasury bonds, a Unitholder's initial
cost for his pro rata portion of each Treasury Obligation held by the Trust
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 Treasury Obligations held by the 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 a Treasury Regulation issued on December 28, 1992
relating to stripped bonds. To the extent the amount of such discount is less
than the respective "de minimis" amount, such discount shall be
treated as zero. 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 the 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
under the stripped bond rules. For federal income tax purposes, a
Unitholder's pro rata portion of dividends as defined by Section 316 of the
Code paid with respect to an Equity Security held by the Trust are taxable as
ordinary income to the extent of such corporation's current and accumulated
"earnings and profits". A Unitholder's pro rata portion of dividends
paid on such Equity Security which exceed such current and accumulated
earnings and profits will first reduce a Unitholder's tax basis in such
Equity Security, and to the extent that such dividends exceed a Unitholder's
tax basis in such Equity Security shall generally be treated as capital gain.
In general, any such capital gain will be short-term unless a Unitholder has
held his Units for more than one year.
3. A Unitholder's portion of gain, if any, upon the sale or redemption of
Units or the disposition of Securities held by the Trust will generally be
considered a capital gain except in the case of a dealer or a financial
institution and, in general, will be long-term if the Unitholder has held his
Units for more than one year. A Unitholder's portion of loss, if any, upon
the sale or redemption of Units or the disposition of Securities held by the
Trust will generally be considered a capital loss except in the case of a
dealer or a financial institution and, in general, will be long-term if the
Unitholder has held his Units for more than one year. Unitholders should
consult their tax advisers regarding the recognition of such capital gains and
losses for federal income tax purposes.
4. The Code provides that "miscellaneous itemized deductions" are
allowable only to the extent that they exceed two percent of an individual
taxpayer's adjusted gross income. Miscellaneous itemized deductions subject
to this limitation under present law include a Unitholder's pro rata share of
expenses paid by the Trust, including fees of the Trustee, Supervisor and the
Evaluator.
Dividends Received Deduction. A corporation that owns Units will generally be
entitled to a 70% dividends received deduction with respect to such
Unitholder's pro rata portion of dividends received by the Trust (to the
extent such dividends are taxable as ordinary income, as discussed above) in
the same manner as if such corporation directly owned the Equity Securities
paying such dividends. However, a corporation owning Units should be aware
that Sections 246 and 246A of the Code impose additional limitations on the
eligibility of dividends for the 70% dividends received deduction. These
limitations include a requirement that stock (and therefore Units) must
generally be held at least 46 days (as determined under Section 246(c) of the
Code). Proposed regulations have been issued which address special rules that
must be considered in determining whether the 46 day holding requirement is
met. Moreover, the allowable percentage of the deduction will be reduced from
70% if a corporate Unitholder owns certain stock (or Units) the financing of
which is directly attributable to indebtedness incurred by such corporation.
It should be noted that various legislative proposals that would affect the
dividends received deduction have been introduced. Unitholders should consult
with their tax advisers with respect to the limitations on and possible
modifications to the dividends received deductions.
Recognition of Taxable Gain or Loss Upon Disposition of Securities by a Trust
or Disposition of Units. As discussed above, a Unitholder may recognize
taxable gain (or loss) when a Security is disposed of by the Trust or if the
Unitholder disposes of a Unit. For taxpayers other than corporations, net
capital gains are subject to a maximum marginal stated tax rate of 28%.
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 Revenue Reconciliation Act of 1993 (the "Act") raised tax rates on
ordinary income while capital gains remain subject to a 28% maximum stated
rate. Because some or all capital gains are taxed at a comparatively lower
rate under the Act, the Act includes a provision that would recharacterize
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.
Special Tax Consequences of In Kind Distributions Upon Redemption of Units or
Termination of a Trust. As discussed in "Rights of Unitholders--Redemption
of Units", under certain circumstances a Unitholder tendering Units for
redemption may request an In Kind Distribution. A Unitholder may also under
certain circumstances request an In Kind Distribution upon the termination of
the Trust. See "Rights of Unitholders--Redemption of Units." Treasury
Obligations will not be distributed to a Unitholder as part of an In Kind
Distribution. The tax consequences relating to the sale of Treasury
Obligations are discussed above. As previously discussed, prior to the
redemption of Units or the termination of the Trust, a Unitholder is
considered as owning a pro rata portion of each of the Trust assets for
federal income tax purposes. The receipt of an In Kind Distribution would be
deemed an exchange of such Unitholder's pro rata portion of each of the
shares of stock and other assets held by the Trust in exchange for an
undivided interest in whole shares of stock plus, possibly, cash.
There are generally three different potential tax consequences which may
occur under an In Kind Distribution with respect to each Security owned by the
Trust. A "Security" for this purpose is a particular class of stock
issued by a particular corporation (and does not include the Treasury
Obligations). If the Unitholder receives only whole shares of a Security in
exchange for his or her pro rata portion in each share of such Security held
by the Trust, there is no taxable gain or loss recognized upon such deemed
exchange pursuant to Section 1036 of the Code. If the Unitholder receives
whole shares of a particular Security plus cash in lieu of a fractional share
of such Security, and if the fair market value of the Unitholder's pro rata
portion of the shares of such Security exceeds his tax basis in his pro rata
portion of such Security, taxable gain would be recognized in an amount not to
exceed the amount of such cash received, pursuant to Section 1031(b) of the
Code. No taxable loss would be recognized upon such an exchange pursuant to
Section 1031(c) of the Code, whether or not cash is received in lieu of a
fractional share. Under either of these circumstances, special rules will be
applied under Section 1031(d) of the Code to determine the Unitholder's tax
basis in the shares of such particular Security which he receives as part of
the In Kind Distribution. Finally, if a Unitholder's pro rata interest in a
Security does not equal a whole share, he may receive entirely cash in
exchange for his pro rata portion of a particular Security. In such case,
taxable gain or loss is measured by comparing the amount of cash received by
the Unitholder with his tax basis in such Security.
Because the Trust will own many Securities, a Unitholder who requests an In
Kind Distribution will have to analyze the tax consequences with respect to
each Security owned by the Trust. The amount of taxable gain (or loss)
recognized upon such exchange will generally equal the sum of the gain (or
loss) recognized under the rules described above by such Unitholder with
respect to each Security owned by the Trust. Unitholders who request an In
Kind Distribution are advised to consult their tax advisers in this regard.
General. Each Unitholder will be requested to provide the Unitholder's
taxpayer identification number to the Trustee and to certify that the
Unitholder has not been notified that payments to the Unitholder are subject
to back-up withholding. If the proper taxpayer identification number and
appropriate certification are not provided when requested, distributions by
the Trust to such Unitholder (including amounts received upon the redemption
of Units) will be subject to back-up withholding. Distributions by the Trust
will generally be subject to United States income taxation and withholding in
the case of Units held by non-resident alien individuals, foreign corporations
or other non-United States persons (accrual of original issue discount on the
Treasury Obligations may not be subject to taxation or withholding provided
certain requirements are met). Such persons should consult their tax advisers.
Unitholders will be notified annually of the amounts of original issue
discount and income dividends includable in the Unitholder's gross income and
amounts of Trust expenses which may be claimed as itemized deductions.
Dividend income, long-term capital gains and accrual of original issue
discount may also be subject to state and local taxes. Investors should
consult their tax advisers for specific information on the tax consequences of
particular types of distributions.
Unitholders desiring to purchase Units for tax-deferred plans and IRAs should
consult their broker-dealers for details on establishing such accounts. Units
may also be purchased by persons who already have self-directed plans
established.
In the opinion of Kroll & Tract, special counsel to the Trust for New
York tax matters, the Trust is not an association taxable as a corporation and
the income of the Trust will be treated as the income of the Unitholders under
the existing income tax laws of the State and City of New York.
TRUST OPERATING EXPENSES
Compensation of Sponsor and Evaluator. The Sponsor will not receive any fees
in connection with its activities relating to the Trust. However, Van Kampen
American Capital Investment Advisory Corp., which is an affiliate of the
Sponsor, will receive an annual supervisory fee which is not to exceed the
amount set forth under "Summary of Essential Financial Information,"
for providing portfolio supervisory services for the Trust. Such fee (which is
based on the number of Units outstanding on January 1 of each year for which
such compensation relates except during the initial offering period in which
event the calculation is based on the number of Units outstanding at the end
of the month of such calculation) may exceed the actual costs of providing
such supervisory services for this Trust, but at no time will the total amount
received for portfolio supervisory services rendered to Series 1 and
subsequent series of Van Kampen Merritt Equity Opportunity Trust (and its
successors) and to any other unit investment trusts sponsored by the Sponsor
for which the Supervisor provides portfolio supervisory services in any
calendar year exceed the aggregate cost to the Supervisor of supplying such
services in such year. In addition, the Evaluator, which is a division of Van
Kampen American Capital Investment Advisory Corp., shall receive the annual
per Unit evaluation fee set forth under "Summary of Essential Financial
Information" (which amount is based on the number of Units outstanding on
January 1 of each year for which such compensation relates except during the
initial offering period in which event the calculation is based on the number
of Units outstanding at the end of the month of such calculation) for
regularly evaluating the Trust portfolio. The foregoing fees are payable as
described under "General" below. Both of 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 sales commissions and may
realize other profits (or losses) in connection with the sale of Units and the
deposit of the Securities as described under "Public Offering--Sponsor
Profits."
Trustee's Fee. For its services the Trustee will receive the annual per Unit
fee from the Trust set forth under "Summary of Essential Financial
Information" (which amount is based on the number of Units outstanding on
January 1 of each year for which such compensation relates except during the
initial offering period in which event the calculation is based on the number
of Units outstanding at the end of the month of such calculation). The
Trustee's fees are payable as described under "General" below. The
Trustee benefits to the extent there are funds for future distributions,
payment of expenses and redemptions in the Capital and Income Accounts since
these Accounts are non-interest bearing and the amounts earned by the Trustee
are retained by the Trustee. Part of the Trustee's compensation for its
services to the Trust is expected to result from the use of these funds. Such
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. For a discussion of the services rendered by the Trustee
pursuant to its obligations under the Trust Agreement, see "Rights of
Unitholders--Reports Provided" and "Trust Administration."
Miscellaneous Expenses. Expenses incurred in establishing the Trust, including
the cost of the initial preparation of documents relating to the Trust
(including the Prospectus, Trust Agreement and certificates), federal and
state registration fees, the initial fees and expenses of the Trustee, legal
and accounting expenses, payment of closing fees and any other out-of-pocket
expenses, will be paid by the Trust and amortized over a five year period. The
following additional charges are or may be incurred by the Trust: (a) normal
expenses (including the cost of mailing reports to Unitholders) incurred in
connection with the operation of the Trust, (b) fees of the Trustee for
extraordinary services, (c) expenses of the Trustee (including legal and
auditing expenses) and of counsel designated by the Sponsor, (d) various
governmental charges, (e) expenses and costs of any action taken by the
Trustee to protect the Trust and the rights and interests of Unitholders, (f)
indemnification of the Trustee for any loss, liability or expenses incurred in
the administration of the Trust without negligence, bad faith or wilful
misconduct on its part and (g) expenditures incurred in contacting Unitholders
upon termination of the Trust. The expenses set forth herein are payable as
described under "General" below.
General. When such fees and expenses are paid by or owning to the Trustee,
they are secured by a lien on the Trust's portfolio. During the initial
offering period of the Trust, all of the fees and expenses will accrue on a
daily basis and will be charged to the Trust, in arrears, at the end of the
initial offering period. After the initial offering period of the Trust, all
of the fees and expenses of the Trust will accrue on a daily basis and will be
charged to the Trust, in arrears, on a monthly basis on or before the
twenty-fifth day of each month. The fees and expenses are payable out of the
Capital Account. If the balances in the Capital Account is insufficient to
provide for amounts payable by the Trust, the Trustee has the power to sell
Equity Securities (but not Treasury Obligations unless the maturity value of
the Treasury Obligations is not less than $11.00 per Unit) to pay such
amounts. These sales may result in capital gains or losses to Unitholders. See
"Federal Taxation."
PUBLIC OFFERING
General. Units are offered at the Public Offering Price. The Public Offering
Price is based on the aggregate underlying value of the Equity Securities and
during the initial offering the offering side evaluation of the Treasury
Obligations (bid side evaluation in the secondary market), a sales charge of
4.9% of the Public Offering Price which is equivalent to 5.152% of the
aggregate underlying value of the Securities, and cash, if any, in the Income
and Capital Accounts held or owned by the Trust. The sales charge for
secondary market transactions is described under "Offering Price"
below. The initial sales charge applicable to quantity purchases is, during
the initial offering period, reduced on a graduated basis to any person
acquiring 5,000 or more Units as follows:
<TABLE>
<CAPTION>
Aggregate Number Dollar Amount of Sales
of Units Purchased Charge Reduction Per Unit
<S> <C>
5,000-9,999 $0.03
10,000-24,999 $0.05
25,000-49,999 $0.10
50,000-99,999 $0.15
100,000 or more $0.20
</TABLE>
The sales charge reduction will primarily be the responsibility of the selling
broker, dealer or agent. This reduced sales charge structure will apply on all
purchases by the same person from any one dealer of units of Van Kampen
American Capital-sponsored unit investment trusts which are being offered in
the initial offering period (a) on any one day (the "Initial Purchase
Date") or (b) on any day subsequent to the Initial Purchase Date if (1)
the units purchased are of a unit investment trust purchased on the Initial
Purchase Date, and (2) the person purchasing the units purchased a sufficient
amount of units on the Initial Purchase Date to qualify for a reduced sales
charge on such date. In the event units of more than one trust are purchased
on the Initial Purchase Date, the aggregate dollar amount of such purchases
will be used to determine whether purchasers are eligible for a reduced sales
charge. Such aggregate dollar amount will be divided by the public offering
price per unit (on the day preceding the date of purchase) of each respective
trust purchased to determine the total number of units which such amount could
have purchased of each individual trust. Purchasers must then consult the
applicable trust's prospectus to determine whether the total number of units
which could have been purchased of a specific trust would have qualified for a
reduced sales charge and, if so qualified, the amount of such reduction.
Assuming a purchaser qualifies for a sales charge reduction or reductions, to
determine the applicable sales charge reduction or reductions it is necessary
to accumulate all purchases made on the Initial Purchase Date and all
purchases made in accordance with (b) above. Units purchased in the name of
the spouse of a purchaser or in the name of a child of such purchaser under 21
years of age will be deemed for the purposes of calculating the applicable
sales charge to be additional purchases by the purchaser. The reduced sales
charges will also be applicable to a trustee or other fiduciary purchasing
securities for one or more trust estate or fiduciary accounts.
Employees of Van Kampen American Capital Distributors, Inc. and its
subsidiaries may purchase Units of the Trust at the current Public Offering
Price less the underwriting commission or the dealer's concession in the
absence of an underwriting commission. Registered representatives of selling
brokers, dealers, or agents may purchase Units of the Trust at the current
Public Offering Price less the dealer's concession during the initial offering
period and for secondary market transactions.
Units may be purchased in the primary or secondary market at the Public
Offering Price (for purchases which do not qualify for a sales charge
reduction for quantity purchases) less the concession the Sponsor typically
allows to brokers and dealers for purchases (see "Public Offering--Unit
Distribution") by (1) investors who purchase Units through registered
investment advisers, certified financial planners and registered
broker-dealers who in each case either charge periodic fees for financial
planning, investment advisory or asset management service, or provide such
services in connection with the establishment of an investment account for
which a comprehensive "wrap fee" charge is imposed, (2) bank trust
departments investing funds over which they exercise exclusive discretionary
investment authority and that are held in a fiduciary, agency, custodial or
similar capacity, (3) any person who for at least 90 days, has been an
officer, director or bona fide employee of any firm offering Units for sale to
investors or their immediate family members (as described above) and (4)
officers and directors of bank holding companies that make Units available
directly or through subsidiaries or bank affiliates. Notwithstanding anything
to the contrary in this Prospectus, such investors, bank trust departments,
firm employees and bank holding company officers and directors who purchase
Units through this program will not receive sales charge reductions for
quantity purchases.
Offering Price. The Public Offering Price of the Units will vary from the
amounts stated under "Summary of Essential Financial Information" in
accordance with fluctuations in the prices of the underlying Securities in the
Trust.
As indicated above, the price of the Units was established by adding to the
determination of the aggregate underlying value of the Securities an amount
equal to 5.152% of such value and dividing the sum so obtained by the number
of Units outstanding. The Public Offering Price shall also include the
proportionate share of any cash held in the Capital Account. This computation
produced a gross underwriting profit equal to 4.9% of the Public Offering
Price. Such price determination as of the close of business on the day before
the Initial Date of Deposit was made on the basis of an evaluation of the
Securities in the Trust prepared by Interactive Data Corporation, a firm
regularly engaged in the business of evaluating, quoting or appraising
comparable securities. After the close of business on the day before the
Initial Date of Deposit, the Evaluator will appraise or cause to be appraised
daily the value of the underlying Securities as of the Evaluation Time on days
the New York Stock Exchange is open and will adjust the Public Offering Price
of the Units commensurate with such valuation. Such Public Offering Price will
be effective for all orders received prior to the Evaluation Time on each such
day. Orders received by the Trustee or Sponsor for purchases, sales or
redemptions after that time, or on a day when the New York Stock Exchange is
closed, will be held until the next determination of price. Effective on each
July 26, commencing July 26, 1997, the secondary market sales charge will be
reduced by .3 of 1% to a minimum sales charge of 1.5%.
The value of the Equity Securities during the initial offering period is
determined on each business day by the Evaluator in the following manner: if
the Equity Securities are listed on a national securities exchange this
evaluation is generally based on the closing sale prices on that exchange
(unless it is determined that these prices are inappropriate as a basis for
valuation) or, if there is no closing sale price on that exchange, at the
closing ask prices. If the Equity Securities are not so listed or, if so
listed and the principal market therefor is other than on the exchange, the
evaluation shall generally be based on the current ask price on the
over-the-counter market (unless it is determined that these prices are
inappropriate as a basis for evaluation). If current ask prices are
unavailable, the evaluation is generally determined (a) on the basis of
current ask prices for comparable securities, (b) by appraising the value of
the Equity Securities on the ask side of the market or (c) by any combination
of the above. During the initial offering period, the Treasury Obligations
will be valued at their net offering prices. If net offering prices are not
available for the Treasury Obligations, then such evaluations will be based on
(1) offering prices for comparable securities, (2) by determining the value of
the Treasury Obligations on the offer side of the market by appraisal or (3)
by any combination of the above. After the completion of the initial offering
period, the Treasury Obligations will be valued on the bid prices thereof. The
offering price of the Treasury Obligations may be expected to be greater than
the bid price of the Treasury Obligations by less than 2%.
In offering the Units to the public, neither the Sponsor nor any
broker-dealers are recommending any of the individual Securities in the Trust
but rather the entire pool of Securities, taken as a whole, which are
represented by the Units.
Unit Distribution. During the initial offering period, Units will be
distributed to the public by the Sponsor, broker-dealers and others at the
Public Offering Price. Upon the completion of the initial offering period,
Units repurchased in the secondary market, if any, may be offered by this
Prospectus at the secondary market Public Offering Price in the manner
described above.
The Sponsor intends to qualify the Units for sale in a number of states.
Broker-dealers or others will be allowed a concession or agency commission in
connection with the distribution of Units during the initial offering period
of 3.50% per Unit. Volume concessions or agency commissions of an additional
.20% of the Public Offering Price will be given to any broker/dealer or bank,
who purchases from the Sponsor at least $100,000 on the Initial Date of
Deposit or $250,000 on any day thereafter. Any quantity discount provided to
investors will be borne by the selling dealer or agent as indicated under "
General" above. For secondary market transactions, such concession or
agency commission will amount to 70% of the sales charge applicable to the
transaction.
Certain commercial banks are making Units of the Trust available to their
customers on an agency basis. A portion of the sales charge (equal to the
agency commission referred to above) is retained by or remitted to the banks.
Under the Glass-Steagall Act, banks are prohibited from underwriting Trust
Units; however, the Glass-Steagall Act does permit certain agency transactions
and the banking regulators have not indicated that these particular agency
transactions are not 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.
To facilitate the handling of transactions, sales of Units shall normally be
limited to transactions involving a minimum of 100 Units except as stated
herein. In connection with fully disclosed transactions with the Sponsor, the
minimum purchase requirement will be that number of Units set forth in the
contract between the Sponsor and the related broker or agent. The Sponsor
reserves the right to reject, in whole or in part, any order for the purchase
of Units and to change the amount of the concession or agency commission to
dealers and others from time to time.
Sponsor Compensation. The Sponsor will receive a gross sales commission equal
to 4.9% of the Public Offering Price of the Units (equivalent to 5.152% of the
aggregate value of Securities less the deferred sales charge), less any
reduced sales charge for quantity purchases (as described under "
General" above). Any quantity discount provided to investors will be borne
by the selling broker, dealer or agent as indicated under "General"
above.
In addition, the Sponsor will realize a profit or will sustain a loss, as the
case may be, as a result of the difference between the price paid for the
Securities by the Sponsor and the cost of such Securities to the Trust on the
Initial Date of Deposit as well as on subsequent deposits. See "Notes to
Portfolio." The Sponsor has not participated as sole underwriter or as
manager or as a member of the underwriting syndicates or as an agent in a
private placement for any of the Securities in the Trust portfolio. The
Sponsor may further realize additional profit or loss during the initial
offering period as a result of the possible fluctuations in the market value
of the Securities in the Trust after a date of deposit, since all proceeds
received from purchasers of Units (excluding dealer concessions and agency
commissions allowed, if any) will be retained by the Sponsor. Broker-dealers
or others (each "a distributor") who distribute 1,000,000 - 1,999,999
Units during the initial offering period will receive additional compensation
from the Sponsor, after the close of the initial offering period, of $0.01 for
each Unit it distributes; or each distributor who distributes 2,000,000 -
2,999,999 Units will receive additional compensation of $0.015 for each Unit
it distributes; or each distributor who distributes 3,000,000 or more Units
will receive additional compensation of $0.02 for each Unit it distributes.
Broker-dealers of the Trust, banks and/or others may be eligible to
participate in a program in which such firms receive from the Sponsor a
nominal award for each of their representatives who have sold a minimum number
of units of unit investment trusts created by the Sponsor during a specified
time period. In addition, at various times the Sponsor may implement other
programs under which the sales forces of brokers, dealers, banks and/or others
may be eligible to win other nominal awards for certain sales efforts, or
under which the Sponsor will reallow to such brokers, dealers, banks and/or
others that sponsor sales contests or recognition programs conforming to
criteria established by the Sponsor, or participate in sales programs
sponsored by the Sponsor, an amount not exceeding the total applicable sales
charges on the sales generated by such persons at the public offering price
during such programs. Also, the Sponsor in its discretion may from time to
time pursuant to objective criteria established by the Sponsor pay fees to
qualifying entities for certain services or activities which are primarily
intended to result in sales of Units of the Trust. Such payments are made by
the Sponsor out of its own assets, and not out of the assets of the Trust.
These programs will not change the price Unitholders pay for their Units or
the amount that the Trust will receive from the Units sold.
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.
As stated under "Public Market" below, the Sponsor intends to maintain
a secondary market for Units of the Trust. In so maintaining a market, the
Sponsor will also realize profits or sustain losses in the amount of any
difference between the price at which Units are purchased and the price at
which Units are resold (which price includes the applicable sales charge). In
addition, the Sponsor will also realize profits or sustain losses resulting
from a redemption of such repurchased Units at a price above or below the
purchase price for such Units, respectively.
Public Market. Although it is obligated to do so, the Sponsor intends to
maintain a market for the Units offered hereby and offer continuously to
purchase Units at prices, subject to change at any time, based upon the
aggregate underlying value of the Equity Securities in the Trust plus the
aggregate bid price of the Treasury Obligations (offer price during the
initial offering period). If the supply of Units exceeds demand or if some
other business reason warrants it, the Sponsor may either discontinue all
purchases of Units or discontinue purchases of Units at such prices. In the
event that a market is not maintained for the Units and the Unitholder cannot
find another purchaser, a Unitholder desiring to dispose of his Units may be
able to dispose of such Units only by tendering them to the Trustee for
redemption at the Redemption Price. See "Rights of Unitholders--Redemption
of Units." A Unitholder who wishes to dispose of his Units should inquire
of his 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. Units sold prior to such time as the entire deferred sales
charge on such Units has been collected will be assessed the amount of the
remaining deferred sales charge at the time of sale.
Tax-Sheltered Retirement Plans. Units of the Trust are available for purchase
in connection with certain types of tax-sheltered retirement plans, including
Individual Retirement Accounts for individuals, Simplified Employee Pension
Plans for employees, qualified plans for self-employed individuals, and
qualified corporate pension and profit sharing plans for employees. The
purchase of Units of the Trust may be limited by the plans' provisions and
does not itself establish such plans.
RIGHTS OF UNITHOLDERS
Certificates. The Trustee is authorized to treat as the record owner of Units
that person who is registered as such owner on the books of the Trustee.
Ownership of Units of the Trust will be evidenced by certificates unless a
Unitholder or the Unitholder's registered broker-dealer makes a written
request to the Trustee that ownership be in book entry form. Units are
transferable by making a written request to the Trustee and, in the case of
Units evidenced by a certificate, by presentation and surrender of such
certificate to the Trustee properly endorsed or accompanied by a written
instrument or instruments of transfer. A Unitholder must sign such written
request, and such certificate or transfer instrument, exactly as his name
appears on the records of the Trustee and on the face of any certificate
representing the Units to be transferred with the signature guaranteed by a
participant in the Securities Transfer Agents Medallion Program ("
STAMP") or such other signature guarantee 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. Certificates will be
issued in denominations of one Unit or any whole multiple thereof.
Although no such charge is now made or contemplated, the Trustee may require a
Unitholder to pay a reasonable fee for each certificate reissued or
transferred and to pay any governmental charge that may be imposed in
connection with each such transfer or interchange. Destroyed, stolen,
mutilated or lost certificates will be replaced upon delivery to the Trustee
of satisfactory indemnity, evidence of ownership and payment of expenses
incurred. Mutilated certificates must be surrendered to the Trustee for
replacement.
Distributions of Income and Capital. Any dividends received by the Trust with
respect to the Equity Securities therein are credited by the Trustee to the
Income Account. Other receipts (e.g., capital gains, proceeds from the sale of
Securities, return of principal, etc.) are credited to the Capital Account of
the Trust.
The Trustee will distribute any income received with respect to any of the
Securities in the Trust on or about the Income Distribution Dates to
Unitholders of record on the preceding Income Record Dates. See "Summary
of Essential Financial Information." Proceeds received on the sale of any
Securities in the Trust, to the extent not used to meet redemptions of Units
or pay fees and expenses, will be distributed annually on the Capital Account
Distribution Date to Unitholders of record on the preceding Capital Account
Record Date. Income with respect to the original issue discount on the
Treasury Obligations will not be distributed currently, although Unitholders
in the Trust will be subject to federal income tax as if a distribution had
occurred. See "Federal Taxation." Proceeds received from the
disposition of any of the Securities after a record date and prior to the
following distribution date will be held in the Capital Account and not
distributed until the next distribution date applicable to such Capital
Account. The Trustee is not required to pay interest on funds held in the
Capital or Income Accounts (but may itself earn interest thereon and therefore
benefits from the use of such funds).
The distribution to Unitholders as of each record date will be made on the
following distribution date or shortly thereafter and shall consist of each
Unitholder's pro rata share of the cash in the Income Account. Because
dividends are not received by the Trust at a constant rate throughout the
year, such distributions to Unitholders are expected to fluctuate from
distribution to distribution. Persons who purchase Units will commence
receiving distributions only after such person becomes a record owner.
Notification to the Trustee of the transfer of Units is the responsibility of
the purchaser, but in the normal course of business such notice is provided by
the selling broker-dealer.
On or before the twenty-fifth day of each month, the Trustee will deduct from
the Capital Account amounts necessary to pay the expenses of the Trust (as
determined on the basis set forth under "Trust Operating Expenses").
The Trustee also may withdraw from the Income and Capital Accounts such
amounts, if any, as it deems necessary to establish a reserve for any
governmental charges payable out of the Trust. Amounts so withdrawn shall not
be considered a part of the Trust's assets until such time as the Trustee
shall return all or any part of such amounts to the appropriate accounts. In
addition, the Trustee may withdraw from the Income and Capital Accounts such
amounts as may be necessary to cover redemptions of Units.
Reinvestment Option. Unitholders may elect to have each distribution of
income, capital gains and/or capital on their Units automatically reinvested
in shares of any Van Kampen American Capital mutual funds (except for B
shares) which are registered in the Unitholder's state of residence. Such
mutual funds are hereinafter collectively referred to as the "Reinvestment
Funds".
Each Reinvestment Fund has investment objectives which differ in certain
respects from those of the Trust. The prospectus relating to each Reinvestment
Fund describes the investment policies of such fund and sets forth the
procedures to follow to commence reinvestment. A Unitholder may obtain a
prospectus for the respective Reinvestment Funds from Van Kampen American
Capital Distributors, Inc. at One Parkview Plaza, Oakbrook Terrace, Illinois
60181. Texas residents who desire to reinvest may request that a broker-dealer
registered in Texas send the prospectus relating to the respective fund.
After becoming a participant in a reinvestment plan, each distribution of
income, capital gains and/or capital on the participant's Units will, on the
applicable distribution date, automatically be applied, as directed by such
person, as of such distribution date by the Trustee to purchase shares (or
fractions thereof) of the applicable Reinvestment Fund at a net asset value as
computed as of the close of trading on the New York Stock Exchange on such
date. Unitholders with an existing Guaranteed Reinvestment Option (GRO)
Program account (whereby a sales charge is imposed on distribution
reinvestments) may transfer their existing account into a new GRO account
which allows purchases of Reinvestment Fund shares at net asset value as
described above. Confirmations of all reinvestments by a Unitholder into a
Reinvestment Fund will be mailed to the Unitholder by such Reinvestment Fund.
A participant may at any time prior to five days preceding the next succeeding
distribution date, by so notifying the Trustee in writing, elect to terminate
his or her reinvestment plan and receive future distributions on his or her
Units in cash. There will be no charge or other penalty for such termination.
The Sponsor, each Reinvestment Fund, and its investment adviser shall have the
right to suspend or terminate the reinvestment plan at any time.
Reports Provided. The Trustee shall furnish Unitholders in connection with
each distribution a statement of the amount of income and the amount of other
receipts (received since the preceding distribution), if any, being
distributed, expressed in each case as a dollar amount representing the pro
rata share of each Unit outstanding. For as long as the Sponsor deems it to be
in the best interest of the Unitholders, the accounts of the Trust shall be
audited, not less frequently than annually, by independent certified public
accountants, and the report of such accountants shall be furnished by the
Trustee to Unitholders upon 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 registered Unitholder a statement (i)
as to the Income Account: income received (including amortization of original
issue discount with respect to the Treasury Obligations), deductions for
applicable taxes and for fees and expenses of the Trust, for redemptions of
Units, if any, and the balance remaining after such distributions and
deductions, expressed in each case both as a total dollar amount and as a
dollar amount representing the pro rata share of each Unit outstanding on the
last business day of such calendar year; (ii) as to the Capital Account: the
dates of disposition of any Securities and the net proceeds received
therefrom, deductions for payment of applicable taxes, fees and expenses of
the Trust held for distribution to Unitholders of record as of a date prior to
the determination and the balance remaining after such distributions and
deductions expressed both as a total dollar amount and as a dollar amount
representing the pro rata share of each Unit outstanding on the last business
day of such calendar year; (iii) a list of the Securities held and the number
of Units outstanding on the last business day of such calendar year; (iv) the
Redemption Price per Unit based upon the last computation thereof made during
such calendar year; and (v) amounts actually distributed during such calendar
year from the Income and Capital Accounts, separately stated, expressed as
total dollar amounts.
In order to comply with federal and state tax reporting requirements,
Unitholders will be furnished, upon request to the Trustee, evaluations of the
Securities in the Trust furnished to it by the Evaluator.
Redemption of Units. A Unitholder may redeem all or a portion of his Units by
tender to the Trustee at its unit investment trust division office at 101
Barclay Street, 20th Floor, New York, New York 10286 and, in the case of Units
evidenced by a certificate, by tendering such certificate to the Trustee, duly
endorsed or accompanied by proper instruments of transfer with signature
guaranteed (or by providing satisfactory indemnity, as in connection with
lost, stolen or destroyed certificates) and by payment of applicable
governmental charges, if any. No redemption fee will be charged. On the third
business day following such tender, the Unitholder will be entitled to receive
in cash an amount for each Unit equal to the Redemption Price per Unit next
computed after receipt by the Trustee of such tender of Units. The "date
of tender" is deemed to be the date on which Units are received by the
Trustee, except that as regards Units received after the Evaluation Time the
date of tender is the next day on which the New York Stock Exchange is open
for trading and such Units will be deemed to have been tendered to the Trustee
on such day for redemption at the redemption price computed on that day.
The Trustee is empowered to sell Securities in order to make funds available
for redemption if funds are not otherwise available in the Capital and Income
Accounts to meet redemptions. The Securities to be sold will be selected by
the Trustee from those designated on a current list provided by the Supervisor
for this purpose. Units so redeemed shall be cancelled.
Unitholders tendering 1,000 Units or more for redemption may request from the
Trustee in lieu of a cash redemption a distribution in kind ("In Kind
Distributions") of an amount and value of Securities per Unit equal to the
Redemption Price per Unit as determined as of the evaluation next following
the tender. An In Kind Distribution on redemption of Units will be made by the
Trustee through the distribution of each of the Equity Securities in
book-entry form to the account of the Unitholder's bank or broker-dealer at
Depository Trust Company. The tendering Unitholder will receive his pro rata
number of whole shares of each of the Securities comprising the portfolio and
cash from the Capital Account equal to the fractional shares and the pro rata
portion of the Treasury Obligations to which the tendering Unitholder is
entitled. In implementing these redemption procedures, the Trustee shall make
any adjustments necessary to reflect differences between the Redemption Price
of the Securities distributed in kind as of the date of tender. If funds in
the Capital Account are insufficient to cover the required cash distribution
to the tendering Unitholder, the Trustee may sell Securities according to the
criteria discussed above. For the tax consequences related to an In Kind
Distribution see "Federal Taxation."
To the extent that Securities are redeemed in kind or sold, the size of the
Trust will be, and the diversity of the Trust may be, reduced. Sales may be
required at a time when Securities would not otherwise be sold and may result
in lower prices than might otherwise be realized. The price received upon
redemption may be more or less than the amount paid by the Unitholder
depending on the value of the Securities in the portfolio at the time of
redemption. Special federal income tax consequences will result if a
Unitholder requests an In Kind Distribution. See "Federal Taxation."
The Redemption Price per Unit (as well as the secondary market Public Offering
Price) will be determined on the basis of the aggregate underlying value of
the Equity Securities in the Trust plus the bid price of the Treasury
Obligations, plus or minus cash, if any, in the Income and Capital Accounts.
On the Initial Date of Deposit, the Public Offering Price per Unit (which
includes the sales charge) exceeded the values at which Units could have been
redeemed by the amounts shown under "Summary of Essential Financial
Information." While the Trustee has the power to determine the Redemption
Price per Unit when Units are tendered for redemption, such authority has been
delegated to the Evaluator which determines the price per Unit on a daily
basis. The Redemption Price per Unit is the pro rata share of each Unit in the
Trust determined on the basis of (i) the cash on hand in the Trust, (ii) the
value of the Securities in the Trust and (iii) dividends receivable on the
Equity Securities trading ex-dividend as of the date of computation, less (a)
amounts representing taxes or other governmental charges payable out of the
Trust and (b) the accrued sales charges or expenses of the Trust. The
Evaluator may determine the value of the Equity Securities in the Trust in the
following manner: if the Equity Securities are listed on a national securities
exchange this evaluation is generally based on the closing sale prices on that
exchange (unless it is determined that these prices are inappropriate as a
basis for valuation) or, if there is no closing sale price on that exchange,
at the closing bid prices. If the Equity Securities are not so listed or, if
so listed and the principal market therefore is other than on the exchange,
the evaluation shall generally be based on the current bid price on the
over-the-counter market (unless these prices are inappropriate as a basis for
evaluation). If current bid prices are unavailable, the evaluation is
generally determined (a) on the basis of current bid prices for comparable
securities, (b) by appraising the value of the Equity Securities on the bid
side of the market or (c) by any combination of the above. See "Public
Offering--Offering Price" for a description of the method of evaluating
the Treasury Obligations.
As stated above, the Trustee may sell Securities to cover redemptions. When
Securities are sold, the size and diversity of the Trust will be reduced. Such
sales may be required at a time when Securities would not otherwise be sold
and might result in lower prices than might otherwise be realized.
The right of redemption may be suspended and payment postponed for any period
during which the New York Stock Exchange is closed, other than for customary
weekend and holiday closings, or any period during which the Securities and
Exchange Commission determines that trading on that Exchange is restricted or
an emergency exists, as a result of which disposal or evaluation of the
Securities in the Trust is not reasonably practicable, or for such other
periods as the Securities and Exchange Commission may by order permit.
TRUST ADMINISTRATION
Sponsor Purchases of Units. The Trustee shall notify the Sponsor of any tender
of Units for redemption. If the Sponsor's bid in the secondary market at that
time equals or exceeds the Redemption Price per Unit, it may purchase such
Units by notifying the Trustee before the close of business on the next
succeeding business day and by making payment therefor to the Unitholder not
later than the day on which the Units would otherwise have been redeemed by
the Trustee. Units held by the Sponsor may be tendered to the Trustee for
redemption as any other Units.
The offering price of any Units acquired by the Sponsor will be in accord with
the Public Offering Price described in the then currently effective prospectus
describing such Units. Any profit resulting from the resale of such Units will
belong to the Sponsor which likewise will bear any loss resulting from a lower
offering or redemption price subsequent to its acquisition of such Units.
Portfolio Administration. The portfolio of the Trust is not "managed"
by the Sponsor, Supervisor or the Trustee; their activities described herein
are governed solely by the provisions of the Trust Agreement. Traditional
methods of investment management for a managed fund typically involve frequent
changes in a portfolio of securities on the basis of economic, financial and
market analyses. The Trust, however, will not be managed. The Trust Agreement,
however, provides that the Sponsor may (but need not) direct the Trustee to
dispose of an Equity Security in certain events such as the issuer having
defaulted on the payment on any of its outstanding obligations or the price of
an Equity Security has declined to such an extent or other such credit factors
exist so that in the opinion of the Sponsor, the retention of such Securities
would be detrimental to the Trust. Pursuant to the Trust Agreement, the
Sponsor is not authorized to direct the reinvestment of the proceeds of the
sale of Securities in replacement securities except in the event the sale is
the direct result of serious adverse credit factors affecting the issuer of
the Security which, in the opinion of the Sponsor, would make the retention of
such Security detrimental to the Trust. Pursuant to the Trust Agreement and
with limited exceptions, the Trustee may sell any securities or other
properties acquired in exchange for Equity Securities such as those acquired
in connection with a merger or other transaction. If offered such new or
exchanged securities or property, the Trustee shall reject the offer. However,
in the event such securities or property are nonetheless acquired by the
Trust, they may be accepted for deposit in the Trust and either sold by the
Trustee or held in the Trust pursuant to the direction of the Sponsor (who may
rely on the advice of the Supervisor). Treasury Obligations may be sold by the
Trustee only pursuant to the liquidation of the Trust or to meet redemption
requests. Therefore, except as stated under "Trust Portfolio" for
failed securities and as provided in this paragraph, the acquisition by the
Trust of any securities other than the Securities is prohibited. Proceeds from
the sale of Securities (or any securities or other property received by the
Trust in exchange for Equity Securities), unless held for reinvestment as
herein provided, are credited to the Capital Account for distribution to
Unitholders, to meet redemptions or to pay charges and expenses of the Trust.
As indicated under "Rights of Unitholders--Redemption of Units" above,
the Trustee may also sell Securities designated by the Supervisor, or if not
so directed, in its own discretion, for the purpose of redeeming Units of the
Trust tendered for redemption and the payment of expenses; provided, however,
that in the case of Securities sold to meet redemption requests, Treasury
Obligations may only be sold if the Trust is assured of retaining a sufficient
principal amount of Treasury Obligations to provide funds upon maturity of the
Trust at least equal to $11.00 per Unit. Treasury Obligations may not be sold
by the Trustee to meet expenses of the Trust.
The Supervisor, in designating Equity Securities to be sold by the Trustee,
will generally make selections in order to maintain, to the extent
practicable, the proportionate relationship among the number of shares of
individual issues of Equity Securities. To the extent this is not practicable,
the composition and diversity of the Equity Securities may be altered. In
order to obtain the best price for the Trust, it may be necessary for the
Supervisor to specify minimum amounts (generally 100 shares) in which blocks
of Equity Securities are to be sold.
Amendment or 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 thereof which may be
defective or inconsistent, or (2) to make such other provisions as shall not
adversely affect the Unitholders (as determined in good faith by the Sponsor
and the Trustee), provided, however, that the Trust Agreement may not be
amended to increase the number of Units (except as provided in the Trust
Agreement). The Trust Agreement may also be amended in any respect by the
Trustee and Sponsor, or any of the provisions thereof may be waived, with the
consent of the holders of 51% of the Units then outstanding, provided that no
such amendment or waiver will reduce the interest in the Trust of any
Unitholder 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. The Trustee shall advise the Unitholders of any amendment
promptly after execution thereof.
The Trust may be liquidated at any time by consent of Unitholders representing
66 2/3% of the Trust Units then outstanding or by the Trustee when the value
of the Trust, as shown by any evaluation, is less than that amount set forth
under Minimum Termination Value in "Summary of Essential Financial
Information." The Trust will be liquidated by the Trustee in the event
that a sufficient number of Units not yet sold are tendered for redemption by
the Sponsor so that the net worth of the Trust would be reduced to less than
40% of the value of the Securities at the time they were deposited in the
Trust. If the Trust is liquidated because of the redemption of unsold Units
the Sponsor will refund to each purchaser of Units the entire sales charge
paid by such purchaser. The Trust Agreement will terminate upon the sale or
other disposition of the last Security held thereunder, but in no event will
it continue beyond the Mandatory Termination Date stated under "Summary of
Essential Financial Information."
Commencing on the Mandatory Termination Date, Equity Securities will begin to
be sold in connection with the termination of the Trust. The Sponsor will
determine the manner, timing and execution of the sales of the Equity
Securities. The Sponsor shall direct the liquidation of the Securities in such
manner as to effectuate orderly sales and a minimal market impact. In the
event the Sponsor does not so direct, the Securities shall be sold within a
reasonable period and in such manner as the Trustee, in its sole discretion,
shall determine. Written notice of any termination specifying the time or
times at which Unitholders may surrender their certificates for cancellation,
if any are then issued and outstanding, shall be given by the Trustee to each
Unitholder so holding a certificate at his address appearing on the
registration books of the Trust maintained by the Trustee. At least 30 days
before the Mandatory Termination Date the Trustee will provide written notice
thereof to all Unitholders and will include with such notice a form to enable
Unitholders owning 1,000 or more Units to request an In Kind Distribution
rather than payment in cash upon the termination of the Trust. To be
effective, this request must be returned to the Trustee at least five business
days prior to the Mandatory Termination Date. On the Mandatory Termination
Date (or on the next business day thereafter if a holiday) the Trustee will
deliver each requesting Unitholder's pro rata number of whole shares of each
of the Equity Securities in the portfolio to the account of the broker-dealer
or bank designated by the Unitholder at Depository Trust Company. The value of
the Unitholder's fractional shares of the Equity Securities and the pro rata
portion of the Treasury Obligations will be paid in cash. Unitholders with
less than 1,000 Units and those not requesting an In Kind Distribution will
receive a cash distribution from the sale of the remaining Equity Securities
within a reasonable time following the Mandatory Termination Date. Regardless
of the distribution involved, the Trustee will deduct from the funds of the
Trust any accrued costs, expenses, advances or indemnities provided by the
Trust Agreement, including estimated compensation of the Trustee, costs of
liquidation and any amounts required as a reserve to provide for payment of
any applicable taxes or other governmental charges. Any sale of Equity
Securities in the Trust upon termination may result in a lower amount than
might otherwise be realized if such sale were not required at such time. The
Trustee will then distribute to each Unitholder his pro rata share of the
balance of the Income and Capital Accounts.
Within 60 days of the final distribution Unitholders will be furnished a final
distribution statement, in substantially the same form as the annual
distribution statement, of the amount distributable. At such time as the
Trustee in its sole discretion will determine that any amounts held in reserve
are no longer necessary, it will make distribution thereof to Unitholders in
the same manner.
Limitations on Liabilities. The Sponsor, the Evaluator, the Supervisor and the
Trustee shall be under no liability to Unitholders for taking any action or
for refraining from taking any action in good faith pursuant to the Trust
Agreement, or for errors in judgment, but shall be liable only for their own
willful misfeasance, bad faith or gross negligence (negligence in the case of
the Trustee) in the performance of their duties or by reason of their reckless
disregard of their obligations and duties hereunder. The Trustee shall not be
liable for depreciation or loss incurred by reason of the sale by the Trustee
of any of the Securities. In the event of the failure of the Sponsor to act
under the Trust Agreement, the Trustee may act thereunder and shall not be
liable for any action taken by it in good faith under the Trust Agreement.
The Trustee shall not be liable for any taxes or other governmental charges
imposed upon or in respect of the Securities or upon the interest thereon or
upon it as Trustee under the Trust Agreement or upon or in respect of the
Trust which the Trustee may be required to pay under any present or future law
of the United States of America or of any other taxing authority having
jurisdiction. In addition, the Trust Agreement contains other customary
provisions limiting the liability of the Trustee.
The Trustee, Sponsor, Supervisor and Unitholders may rely on any evaluation
furnished by the Evaluator and shall have no responsibility for the accuracy
thereof. Determinations by the Evaluator under the Trust Agreement 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, Sponsor or Unitholders for errors in judgment. This provision shall
not protect the Evaluator in any case of willful misfeasance, bad faith, gross
negligence or reckless disregard of its obligations and duties.
Sponsor. Van Kampen American Capital Distributors, Inc., a Delaware
corporation, is the Sponsor of the Trust. Van Kampen American Capital
Distributors, Inc. is primarily owned by Clayton, Dubilier & Rice, Inc., a New
York-based private investment firm. Van Kampen American Capital Distributors,
Inc. management owns a significant minority equity position. On June 21, 1996
VK/AC Holding, Inc., the indirect corporate parent of the Sponsor, entered
into an Agreement and Plan of Merger among Morgan Stanley Group Inc., MSAM
Holdings II, Inc. and MSAM Acquisition Inc., pursuant to which MSAM
Acquisition Inc. will be merged with and into VK/AC Holding, Inc. and VK/AC
Holding, Inc. will be the surviving corporation. MSAM Acquisition Inc. is a
wholly owned subsidiary of MSAM Holdings II, Inc. which, in turn, is a wholly
owned subsidiary of Morgan Stanley Group Inc. Subject to a number of
conditions being met, it is currently anticipated that a closing will occur in
November of 1996. Thereafter, VK/AC Holding, Inc. and its affiliated entities,
including the Sponsor, shall be part of the Morgan Stanley Group Inc. Van
Kampen American Capital Distributors, Inc. specializes in the underwriting and
distribution of unit investment trusts and mutual funds with roots in money
management dating back to 1926. The Sponsor is a member of the National
Association of Securities Dealers, Inc. and has offices at One Parkview Plaza,
Oakbrook Terrace, Illinois 60181, (708) 684-6000 and 2800 Post Oak Boulevard,
Houston, Texas 77056, (713) 993-0500. It maintains a branch office in
Philadelphia and has regional representatives in Atlanta, Dallas, Los Angeles,
New York, San Francisco, Seattle and Tampa. As of March 31, 1996 the total
stockholders' equity of Van Kampen American Capital Distributors, Inc. was
$123,020,000 (unaudited). (This paragraph relates only to the Sponsor and not
to the Trust or to any other Series thereof. The information is included
herein only for the purpose of informing investors as to the financial
responsibility of the Sponsor and its ability to carry out its contractual
obligations. More detailed financial information will be made available by the
Sponsor upon request.)
As of March 31, 1996, the Sponsor and its affiliates managed or supervised
approximately $57.2 billion of investment products, of which over $24.8
billion is invested in municipal securities. The Sponsor and its affiliates
managed $45.4 billion of assets, consisting of $22.5 billion for 63 open-end
mutual funds (of which 47 are distributed by Van Kampen American Capital
Distributors, Inc.), $11.9 billion for 38 closed-end funds and $5.6 billion
for 93 institutional accounts. The Sponsor has also deposited approximately
$26 billion of unit investment trusts. All of Van Kampen American Capital's
open-end funds, closed-end funds and unit investment trusts are professionally
distributed by leading financial firms nationwide. Based on cumulative assets
deposited, the Sponsor believes that it is the largest sponsor of insured
municipal unit investment trusts, primarily through the success of its Insured
Municipals Income Trust(R)or the IM-IT(R)trust. The Sponsor also
provides surveillance and evaluation services at cost for approximately $13
billion of unit investment trust assets outstanding. Since 1976, the Sponsor
has serviced over two million investor accounts, opened through retail
distribution firms.
If the Sponsor shall fail to perform any of its duties under the Trust
Agreement or become incapable of acting or shall become bankrupt or its
affairs are taken over by public authorities, then the Trustee may (i) appoint
a successor Sponsor at rates of compensation deemed by the Trustee to be
reasonable and not exceeding amounts prescribed by the Securities and Exchange
Commission, (ii) terminate the Trust Agreement and liquidate the Trust as
provided therein or (iii) continue to act as Trustee without terminating the
Trust Agreement.
Trustee. The Trustee is The Bank of New York, a trust company organized under
the laws of New York. The Bank of New York has its offices at 101 Barclay
Street, New York, New York 10286 (800) 221-7668. The Bank of New York is
subject to supervision and examination by the Superintendent of Banks of the
State of New York and the Board of Governors of the Federal Reserve System,
and its deposits are insured by the Federal Deposit Insurance Corporation to
the extent permitted by law.
The duties of the Trustee are primarily ministerial in nature. It did not
participate in the selection of Securities for the Trust portfolio.
In accordance with the Trust Agreement, the Trustee shall keep proper books of
record and account of all transactions at its office for the Trust. Such
records shall include the name and address of, and the number of Units of the
Trust held by, every Unitholder of the Fund. Such books and records shall be
open to inspection by any Unitholder at all reasonable times during the usual
business hours. The Trustee shall make such annual or other reports as may
from time to time be required under any applicable state or federal statute,
rule or regulation (see "Rights of Unitholders--Reports Provided").
The Trustee is required to keep a certified copy or duplicate original of the
Trust Agreement on file in its office available for inspection at all
reasonable times during the usual business hours by any Unitholder, together
with a current list of the Securities held in the Trust.
Under the Trust Agreement, the Trustee or any successor trustee may resign and
be discharged of its responsibilities created by the Trust Agreement by
executing an instrument in writing and filing the same with the Sponsor. The
Trustee or successor trustee must mail a copy of the notice of resignation to
all Unitholders then of record, not less than 60 days before the date
specified in such notice when such resignation is to take effect. The Sponsor
upon receiving notice of such resignation is obligated to appoint a successor
trustee promptly. If, upon such resignation, no successor trustee has been
appointed and has accepted the appointment within 30 days after notification,
the retiring Trustee may apply to a court of competent jurisdiction for the
appointment of a successor. The Sponsor may remove the Trustee and appoint a
successor trustee as provided in the Trust Agreement at any time with or
without cause. Notice of such removal and appointment shall be mailed to each
Unitholder by the Sponsor. Upon execution of a written acceptance of such
appointment by such successor trustee, all the rights, powers, duties and
obligations of the original trustee shall vest in the successor. The
resignation or removal of a Trustee becomes effective only when the successor
trustee accepts its appointment as such or when a court of competent
jurisdiction appoints a successor trustee.
Any corporation into which a Trustee may be merged or with which it may be
consolidated, or any corporation resulting from any merger or consolidation to
which a Trustee shall be a party, shall be the successor trustee. The Trustee
must be a banking corporation organized under the laws of the United States or
any state and having at all times an aggregate capital, surplus and undivided
profits of not less than $5,000,000.
OTHER MATTERS
Legal Opinions. The legality of the Units offered hereby has been passed upon
by Chapman and Cutler, 111 West Monroe Street, Chicago, Illinois 60603, as
counsel for the Sponsor. Kroll & Tract has acted as counsel for the Trustee.
Independent Certified Public Accountants. The statement of condition and the
related securities portfolio at the Initial Date of Deposit included in this
Prospectus have been audited by Grant Thornton LLP, independent certified
public accountants, as set forth in their report in this Prospectus, and are
included herein in reliance upon the authority of said firm as experts in
accounting and auditing.
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Board of Directors of Van Kampen American Capital Distributors,
Inc. and the Unitholders of Van Kampen American Capital Equity Opportunity
Trust, Series 36 (Blue Chip Opportunity and Treasury Trust): We have audited
the accompanying statement of condition and the related portfolio of Van
Kampen American Capital Equity Opportunity Trust, Series 36 (Blue Chip
Opportunity and Treasury Trust) as of July 26, 1996. The statement of
condition and portfolio are the responsibility of the Sponsor. Our
responsibility is to express an opinion on such financial statements based
on our audit.
We conducted our audit in accordance with 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 an irrevocable letter of credit
deposited to purchase securities by correspondence with the Trustee. An audit
also includes assessing the accounting principles used and significant
estimates made by the Sponsor, as well as evaluating the overall financial
statement presentation. We believe our audit provides a reasonable basis for
our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Van Kampen American Capital
Equity Opportunity Trust, Series 36 (Blue Chip Opportunity and Treasury Trust)
as of July 26, 1996, in conformity with generally accepted accounting
principles.
GRANT THORNTON LLP
Chicago, Illinois
July 26, 1996
<TABLE>
<CAPTION>
VAN KAMPEN AMERICAN CAPITAL EQUITY OPPORTUNITY TRUST,
SERIES 36
STATEMENT OF CONDITION
As of July 26, 1996
<S> <C>
Investment in Securities:
Contracts to purchase securities <F1>.......... $
Organizational costs <F2>......................
............................................... $
Liability and Interest of Unitholders:
Liability--
Accrued organizational costs <F2>.............. $
Interest of Unitholders-- .....................
Cost to investors <F3>.........................
Less: Gross underwriting commission <F3><F4>...
Net interest to Unitholders <F3>...............
Total.......................................... $
<FN>
<F1>The aggregate value of the Securities listed under "Portfolio" and
their cost to the Trust are the same. The value of the Securities is
determined by Interactive Data Corporation on the bases set forth under "
Public Offering--Offering Price". The contracts to purchase Securities are
collateralized by an irrevocable letter of credit of $XXXX which has been
deposited with the Trustee.
<F2>The Trust will bear all or a portion of its organizational costs, which will
be deferred and amortized over five years. Organizational costs have been
estimated based on a projected trust size of $XXXX. To the extent the Trust is
larger or smaller, the estimate will vary.
<F3>The aggregate public offering price and the aggregate sales charge of 4.9% are
computed on the bases set forth under "Public Offering--Offering Price"
and "Public Offering--Sponsor Profits" and assume all single
transactions involve less than 5,000 Units. For single transactions involving
5,000 or more Units, the sales charge is reduced (see "Public
Offering--General") resulting in an equal reduction in both the Cost to
investors and the Gross underwriting commission while the Net interest to
Unitholders remains unchanged.
</TABLE>
<TABLE>
VAN KAMPEN AMERICAN CAPITAL BLUE CHIP OPPORTUNITY AND TREASURY TRUST, SERIES 4
PORTFOLIO (VAN KAMPEN AMERICAN CAPITAL EQUITY OPPORTUNITY TRUST, SERIES 36)
as of the Initial Date of Deposit: July 26, 1996
<CAPTION>
Estimated
Market Annual Cost of
Number Value Dividends Securities
of per per to
Shares Name of Issuer<F1> Share<F2> Share<F2> Trust<F2>
<S> <C> <C> <C> <C>
Allied Signal, Inc................................ $ $ $
Aluminum Company of America (ALCOA)...............
American Express Company..........................
American Telephone and Telegraph (AT&T)...........
Bethlehem Steel Corporation.......................
The Boeing Company................................
Caterpillar Inc...................................
Chevron Corporation...............................
Coca-Cola Company.................................
Walt Disney Company...............................
Du Pont (E.I.) de Nemours & Company...............
Eastman Kodak Company.............................
Exxon Corporation.................................
General Electric Company..........................
General Motors....................................
Goodyear Tire & Rubber Company....................
International Business Machines (IBM).............
International Paper Company.......................
McDonalds Corporation.............................
Merck & Company, Inc..............................
Minnesota Mining and Manufacturing Company (3M)...
J.P. Morgan & Company, Inc........................
Phillip Morris Companies, Inc.....................
The Procter & Gamble Company......................
Sears, Roebuck & Company..........................
Texaco, Inc.......................................
Union Carbide Corporation.........................
United Technologies Corporation...................
Westinghouse Electric Corporation.................
Woolworth Corporation.............................
.................................................. $
</TABLE>
<TABLE>
<CAPTION>
Maturity
Value Name of Issuer and Title of Security <F3>
<S> <C> <C>
$ "Zero coupon" U.S. Treasury bonds maturing February 15, 2008...
$
</TABLE>
NOTES TO PORTFOLIO
(1) All of the Securities are represented by "regular way" contracts
for the performance of which an irrevocable letter of credit has been
deposited with the Trustee. At the Initial Date of Deposit, Securities may
have been delivered to the Sponsor pursuant to certain of these contracts; the
Sponsor has assigned to the Trustee all of its right, title and interest in
and to such Securities. Contracts to acquire Securities were entered into on
XXXX XX, 1996 and are expected to settle on XXXX XX, 1996 (see "The
Trust").
(2) The market value of each of the Equity Securities is based on the closing
sale price of each listed Equity Security on the applicable exchange, or if
not so listed, on the ask price on the day prior to the Initial Date of
Deposit. The cost of the Treasury Obligations represents the offering side
evaluation as determined by Interactive Data Corporation. The offering side
evaluation of the Treasury Obligations is greater than the bid side evaluation
of such Treasury Obligations which is the basis on which the Redemption Price
per Unit will be determined. The aggregate value of the Trust, based on the
bid side evaluation of the Treasury Obligations and the aggregate underlying
value of the Equity Securities therein on the Initial Date of Deposit, was
$XXXX. Estimated annual dividends are based on annualizing the most recently
declared dividends. Other information regarding the Securities in the Trust,
as of the Initial Date of Deposit, is as follows:
<TABLE>
<CAPTION>
Profit Estimated
(Loss) to Annual
Cost to Sponsor Sponsor Dividends
<S> <C> <C>
$ $ $
</TABLE>
(3) The Treasury Obligations are being purchased at a discount from their par
value because there is no stated interest income therein (such securities are
often referred to as zero coupon bonds). Over the life of the Treasury
Obligations the value increases, so that upon maturity the holders will
receive 100% of the principal amount thereof.
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 Fund
or the Sponsor. This Prospectus does not constitute an offer to sell, or a
solicitation of an offer to buy securities in any state to any person to whom
it is not lawful to make such offer in such state.
TABLE OF CONTENTS
Title Page
Summary of Essential Financial
Information 3
The Trust 6
Objectives and Securities Selection 6
Trust Portfolio 8
Risk Factors 11
Federal Taxation 14
Trust Operating Expenses 18
Public Offering 19
Rights of Unitholders 23
Trust Administration 27
Other Matters31
Report of Independent Certified
Public Accountants 32
Statement of Condition 33
Portfolio 34
Notes to Portfolio 35
This Prospectus contains information concerning the Fund and the Sponsor, but
does not contain all of the information set forth in the registration
statements and exhibits relating thereto, which the Fund has 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
hereby made.
PROSPECTUS
July 26, 1996
Van Kampen American Capital Equity Opportunity Trust, Series 36
Van Kampen American Capital
Blue Chip Opportunity
and Treasury Trust, Series 4
A Wealth of Knowledge A Knowledge of Wealth
VAN KAMPEN AMERICAN CAPITAL
One Parkview Plaza
Oakbrook Terrace, Illinois 60181
2800 Post Oak Boulevard
Houston, Texas 77056
Please retain this Prospectus for future reference.
Contents Of Registration Statement
This Registration Statement comprises the following papers and documents:
The facing sheet
The Cross-Reference Sheet
The Prospectus
The signatures
The consents of independent public accountants
and legal counsel
The following exhibits:
1.1 Proposed form of Trust Agreement (to be supplied by amendment).
3.1 Opinion and consent of counsel as to legality of securities being
registered (to be supplied by amendment).
3.2 Opinion and consent of counsel as to New York tax status of
securities being registered (to be supplied by amendment).
4.1 Consent of Interactive Data Corporation (to be supplied by
amendment).
4.2 Financial Data Schedule (to be supplied by amendment).
Signatures
Pursuant to the requirements of the Securities Act of 1933, the
Registrant, Van Kampen American Capital Equity Opportunity Trust, Series
36 has duly caused this 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 27th day of June, 1996.
Van Kampen American Capital Equity
Opportunity Trust, Series 36
(Registrant)
By Van Kampen American Capital
Distributors, Inc.
(Depositor)
Sandra A. Waterworth
Vice President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in
the capacities and on June 27, 1996.
Signature Title
Don G. Powell Chairman, Chief Executive )
Officer )
William R. Rybak Senior Vice President and )
Chief Financial Officer )
Ronald A. Nyberg Director )
William R. Molinari Director )
Sandra A. Waterworth
(Attorney-in-fact)*
________________________________________________________________________
*An executed copy of each of the related powers of attorney was filed
with the Securities and Exchange Commission in connection with the
Registration Statement on Form S-6 of Insured Municipals Income Trust and
Investors' Quality Tax-Exempt Trust, Multi-Series 203 (File No. 33-65744)
and and with the Registration Statement on Form S-6 of Insured Municipals
Income Trust, 170th Insured Multi-Series (File No. 33-55891) and the same
are hereby incorporated herein by this reference.
