File No. 333-11937 CIK #897009
Securities and Exchange Commission
Washington, D. C. 20549-1004
Post-Effective
Amendment No. 4 to
Form S-6
For Registration under the Securities Act of 1933 of
Securities of Unit Investment Trusts Registered on
Form N-8B-2
Van Kampen American Capital Equity Opportunity Trust, Series 43
(Exact Name of Trust)
Van Kampen Funds Inc.
(Exact Name of Depositor)
One Parkview Plaza
Oakbrook Terrace, Illinois 60181
(Complete address of Depositor's principal executive offices)
VAN KAMPEN FUNDS INC. CHAPMAN AND CUTLER
Attention: A. Thomas Smith III, General Counsel Attention: Mark J. Kneedy
One Parkview Plaza 111 West Monroe Street
Oakbrook Terrace, Illinois 60181 Chicago, Illinois 60603
(Name and complete address of agents for service)
( X ) Check if it is proposed that this filing will become effective
on December 22, 2000 pursuant to paragraph (b) of Rule 485.
LATIN AMERICAN TRUST, SERIES 1
VAN KAMPEN AMERICAN CAPITAL EQUITY OPPORTUNITY TRUST, SERIES 43
--------------------------------------------------------------------------------
PROSPECTUS PART ONE
NOTE: Part I of this Prospectus may not be distributed unless accompanied by
Part II.
Please retain both parts of this Prospectus for future reference.
--------------------------------------------------------------------------------
THE TRUST
Latin American Trust, Series 1 (the "Trust") is a unit investment trust
in the Van Kampen American Capital Equity Opportunity Trust, Series 43. The
Trust offers investors the opportunity to purchase Units representing
proportionate interests in a fixed, diversified portfolio of common stocks
primarily issued by companies that should benefit from the economic revival and
development of Latin America. Unless terminated earlier, the Trust will
terminate on January 15, 2004 ("Mandatory Termination Date") 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.
PUBLIC OFFERING PRICE
The Public Offering Price per Unit is equal to the aggregate underlying
value of the Equity Securities plus or minus cash, if any, in the Capital and
Income Accounts plus the applicable sales charge as described herein, divided by
the number of Units outstanding. See "Summary of Essential Financial
Information" in this Part One.
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED OF THE
UNITS OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS DECEMBER 22, 2000
VAN KAMPEN FOCUS PORTFOLIOS (SM)
A DIVISION OF VAN KAMPEN FUNDS INC.
LATIN AMERICAN TRUST, SERIES 1
VAN KAMPEN AMERICAN CAPITAL EQUITY OPPORTUNITY TRUST, SERIES 43
SUMMARY OF ESSENTIAL FINANCIAL INFORMATION
AS OF OCTOBER 3, 2000
MANAGING UNDERWRITER: INTERNATIONAL ASSETS ADVISORY CORP.
SPONSOR: VAN KAMPEN FUNDS INC.
SUPERVISOR (1): VAN KAMPEN INVESTMENT ADVISORY CORP.
(AN AFFILIATE OF THE SPONSOR)
SUB- SUPERVISOR (2): GLOBAL ASSETS ADVISORS, INC.
EVALUATOR: AMERICAN PORTFOLIO EVALUATION SERVICES
(A DIVISION OF AN AFFILIATE OF THE SPONSOR)
TRUSTEE: THE BANK OF NEW YORK
<TABLE>
<CAPTION>
LATIN
AMERICAN
TRUST
----------------
<S> <C>
GENERAL INFORMATION
Number of Units 35,452
Fractional Undivided Interest in Trust per Unit 1/35,452
Public Offering Price:
Aggregate Value of Securities in Portfolio (1) $ 284,627.64
Aggregate Value of Securities per Unit (including accumulated dividends) $ 8.0285
Sales charge 4.0% (4.167% of Aggregate Value of Securities excluding principal cash) per Unit $ .3277
Public Offering Price per Unit (2) $ 8.3562
Redemption Price per Unit $ 8.0285
Secondary Market Repurchase Price per Unit $ 8.0285
Excess of Public Offering Price per Unit Over Redemption Price per Unit $ .3277
</TABLE>
Supervisor's Annual Supervisory Fee (1) Maximum of $.0070 per Unit
Evaluator's Annual Evaluators Fee Maximum of $.0025 per Unit
Evaluation Time Close of the New York Stock Exchange
Date of Deposit October 23, 1996
Mandatory Termination Date January 15, 2004
Minimum Termination Value The Trust may be terminated if the
net asset value of such Trust is
less than $500,000 unless the net
asset value of such Trust deposits
has exceeded $15,000,000, then the
Trust Agreement may be terminated if
the net asset value of such Trust is
less than $3,000,000.
Estimated Annual Dividends per Unit (5) $.17119
Trustee's Annual fee (6) $.008 per Unit
Income and Capital Account Record Date TENTH day of December
Income and Capital Account Distribution Date TWENTY-FIFTH day of December.
--------------------------------------------------------------------------------
(1) Pursuant to a contractual arrangement with the Supervisor, Global Assets
Advisors, Inc. will provide to the Supervisor on an agency basis
supervisory services in return for the entire supervisory fee.
(2) Equity Securities listed on a national or foreign securities exchange are
valued at the closing sale price, or if no such price exists, or if the
Equity Securities are not listed, at the closing bid price thereof.
(3) Anyone ordering Units will have added to the Public Offering Price a pro
rata share of any cash in the Income and Capital Accounts.
(4) Effective on each October 23, commencing October 23, 1997, the secondary
sales charge will decrease by .5 of 1% to a minimum sales charge of 3.0%.
See "Public Offering-Offering Price" in Prospectus Part Two.
(5) Estimated annual dividends are based on annualizing the last dividends
declared, taking into consideration any applicable foreign withholding tax.
(6) The Trustee will receive additional annual compensation, payable in monthly
installments of $1.10 and $1.60 per $1,000 of market value of the Equity
Securities traded on Mexican and Argentine securities exchanges,
respectively, and held in a sub-custodian account at month end.
<TABLE>
<CAPTION>
PORTFOLIO
The Latin American Trust, Series 1 consists of 22 different issues of Equity
Securities all of which on the date of deposit were common stocks issued by
companies that should benefit from the economic revival and development of Latin
America. All of the Equity Securities are listed on a national securities
exchange, or are traded in the over-the-counter market as of the Initial Date of
Deposit.
PER UNIT INFORMATION
1997 (1) 1998 1999 2000
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Net asset value per Unit at beginning of period............ $ 9.39 $ 11.56 $ 5.49 $ 7.59
============ ============ ============ ============
Net asset value per Unit at end of period.................. $ 11.56 $ 5.49 $ 7.59 $ 9.23
============ ============ ============ ============
Distributions to Unitholders of investment income including
accumulated dividends paid on Units redeemed
(average Units outstanding for entire period)........... $ 0.00 $ 0.36 $ 0.65 $ 0.40
============ ============ ============ ============
Distributions to Unitholders from Equity Security
redemption proceeds (average Units
outstanding for entire period).......................... $ -- $ -- $ -- $ --
============ ============ ============ ============
Unrealized appreciation (depreciation) of Equity Securities
(per Unit outstanding at end of period)................. $ 1.39 $ (7.78)$ 16.73 $ 6.74
============ ============ ============ ============
Distributions of investment income by frequency
of payment
Semiannual.............................................. $ -- $ 0.24 $ 0.25 $ 0.27
Units outstanding at end of period......................... 637,821 327,321 73,336 35,452
--------------------------------------------------------------------------------
(1) For the period from October 23, 1996 (date of deposit) through August 31,
1997.
</TABLE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
TO THE BOARD OF DIRECTORS OF VAN KAMPEN FUNDS INC. AND THE UNITHOLDERS OF
LATIN AMERICAN TRUST, SERIES 1 (VAN KAMPEN AMERICAN CAPITAL EQUITY OPPORTUNITY
TRUST, SERIES 43):
We have audited the accompanying statements of condition (including the
analyses of net assets) and the related portfolio of Latin American Trust,
Series 1 (Van Kampen American Capital Equity Opportunity Trust, Series 43) as of
August 31, 2000 and the related statements of operations and changes in net
assets for the three years ended August 31, 2000. These statements are the
responsibility of the Trustee and the Sponsor. Our responsibility is to express
an opinion on such statements based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned at August
31, 2000 by correspondence with the Trustee. An audit also includes assessing
the accounting principles used and significant estimates made by the Trustee and
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 Latin American Trust, Series 1
(Van Kampen American Capital Equity Opportunity Trust, Series 43) as of August
31, 2000 and the results of operations and changes in net assets for the three
years ended August 31, 2000, in conformity with accounting principles generally
accepted in the United States of America.
GRANT THORNTON LLP
Chicago, Illinois
October 13, 2000
<TABLE>
<CAPTION>
LATIN AMERICAN TRUST, SERIES 1
STATEMENTS OF CONDITION
AUGUST 31, 2000
LATIN
AMERICAN
TRUST
---------------
<S> <C>
Trust property
Cash ...................................................................................................$ 745
Securities at market value, (cost $522,422) (note 1) ................................................... 326,162
Accumulated dividends .................................................................................. 223
-----------
$ 327,130
===========
Liabilities and interest to Unitholders
Interest to Unitholders ................................................................................$ 327,130
-----------
$ 327,130
===========
ANALYSES OF NET ASSETS
Interest of Unitholders (35,452 Units of fractional undivided interest outstanding)
Cost to original investors of 633,121 Units (note 1) ...................................................$ 6,730,431
Less initial underwriting commission (note 3) ........................................................ 370,061
-----------
6,360,370
Less redemption of 597,669 Units ..................................................................... 4,698,708
-----------
1,661,662
Undistributed net investment income
Net investment income ................................................................................ 310,061
Less distributions to Unitholders .................................................................... 295,528
-----------
14,533
Realized gain (loss) on Security sale .................................................................. (1,152,805)
Unrealized appreciation (depreciation) of Securities (note 2) .......................................... (196,260)
Distributions to Unitholders of Security sale proceeds ................................................. --
-----------
Net asset value to Unitholders .....................................................................$ 327,130
===========
Net asset value per Unit (35,452 Units outstanding) .......................................................$ 9.23
===========
The accompanying notes are an integral part of these statements.
<CAPTION>
LATIN AMERICAN TRUST, SERIES 1
STATEMENTS OF OPERATIONS
YEARS ENDED AUGUST 31,
1998 1999 2000
------------ ------------ ------------
<S> <C> <C> <C>
Investment income
Dividend income...................................................... $ 143,198 $ 47,951 $ 16,917
Expenses
Trustee fees and expenses......................................... 8,748 5,700 4,129
Evaluator fees.................................................... 1,737 1,020 290
Supervisory fees.................................................. 4,863 2,857 944
------------ ------------ ------------
Total expenses................................................. 15,348 9,577 5,363
------------ ------------ ------------
Net investment income............................................. 127,850 38,374 11,554
Realized gain (loss) from Securities sale
Proceeds............................................................. 2,833,375 1,526,323 325,446
Cost................................................................. 2,894,054 2,458,047 485,848
------------ ------------ ------------
Realized gain (loss).............................................. (60,679) (931,724) (160,402)
Net change in unrealized appreciation (depreciation) of Securities...... (2,545,796) 1,226,835 239,063
------------ ------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS................................................ $ (2,478,625) $ 333,485 $ 90,215
============ ============ ============
STATEMENTS OF CHANGES IN NET ASSETS
YEARS ENDED AUGUST 31,
1998 1999 2000
------------ ------------ ------------
Increase (decrease) in net assets Operations:
Net investment income................................................ $ 127,850 $ 38,374 $ 11,554
Realized gain (loss) on Securities sales............................. (60,679) (931,724) (160,402)
Net change in unrealized appreciation (depreciation) of Securities... (2,545,796) 1,226,835 239,063
------------ ------------ ------------
Net increase (decrease) in net assets resulting from operations... (2,478,625) 333,485 90,215
Distributions to Unitholders from:
Net investment income................................................ (180,114) (94,526) (20,888)
Security sale or redemption proceeds................................. -- -- --
Redemption of Units.................................................. (2,922,130) (1,477,672) (298,906)
------------ ------------ ------------
Total increase (decrease)......................................... (5,580,869) (1,238,713) (229,579)
Net asset value to Unitholders
Beginning of period.................................................. 7,376,291 1,795,422 556,709
Additional Securities purchased from the proceeds of Unit Sales...... -- -- --
------------ ------------ ------------
End of period (including undistributed net investment income of
$80,019, $23,867 and $14,533, respectively)....................... $ 1,795,422 $ 556,709 $ 327,130
============ ============ ============
The accompanying notes are an integral part of these statements.
<CAPTION>
LATIN AMERICAN TRUST, SERIES 1 PORTFOLIO AS OF AUGUST 31, 2000
--------------------------------------------------------------------------------------------------------------------------
VALUATION OF
NUMBER MARKET VALUE SECURITIES
OF SHARES NAME OF ISSUER PER SHARE (NOTE 1)
--------------- ------------------------------------------------------------------------------------ ---------------
<S> <C> <C> <C>
567 Banco Latinoamericano de Exportaciones, S.A. (Bladex) $ 27.3750 $ 15,522
--------------------------------------------------------------------------------------------------------------------------
604 Banco Santiago 19.6250 11,854
--------------------------------------------------------------------------------------------------------------------------
580 Compania de Minas Buenaventura S.A. 16.5000 9,570
--------------------------------------------------------------------------------------------------------------------------
831 Companhia Energetica de Minas Gerais (CEMIG) 17.5490 14,583
--------------------------------------------------------------------------------------------------------------------------
1,343 Companhia Vale do Rio Doce 27.1875 36,513
--------------------------------------------------------------------------------------------------------------------------
673 Companhia Siderurgica Nacional 36.2500 24,396
--------------------------------------------------------------------------------------------------------------------------
3,928 Corporacion GEO, S.A. de C.V. 1.8904 7,426
--------------------------------------------------------------------------------------------------------------------------
501 Embratel Participacoes S.A. 21.8750 10,959
--------------------------------------------------------------------------------------------------------------------------
35,125 Groupo Financiero Bancomer, S.A. de C.V. 0.5997 21,066
--------------------------------------------------------------------------------------------------------------------------
7,156 Industrias Penoles S.A. 1.5428 11,040
--------------------------------------------------------------------------------------------------------------------------
412 Inversiones y Representaciones S.A.(IRSA) 24.5000 10,094
--------------------------------------------------------------------------------------------------------------------------
3,862 Lojas Americanas S.A. 2.8230 10,902
--------------------------------------------------------------------------------------------------------------------------
4,775 Molinos Rio de la Plata S.A. 1.9003 9,074
--------------------------------------------------------------------------------------------------------------------------
6,966 Organizacion Soriana S.A. de C.V. 4.3133 30,046
--------------------------------------------------------------------------------------------------------------------------
629 Panamerican Beverages, Inc. 18.5625 11,676
--------------------------------------------------------------------------------------------------------------------------
584 Sociedad Quimica y Minera Chile S.A. 23.3125 13,615
--------------------------------------------------------------------------------------------------------------------------
1,947 Santa Isabel S.A. 6.1250 11,925
--------------------------------------------------------------------------------------------------------------------------
161 Telecomunicacoes Brasileiras S.A. 70.4375 11,340
--------------------------------------------------------------------------------------------------------------------------
1,151 Telabras-Sponsored ADR 0.0000 0
--------------------------------------------------------------------------------------------------------------------------
761 Tele Norte Leste Participacoes S.A. 25.5000 19,406
--------------------------------------------------------------------------------------------------------------------------
318 Telesp Celular Participacoes S.A. 36.7500 11,687
--------------------------------------------------------------------------------------------------------------------------
3,129 Transportadoro de Gas del Sur, S.A. (TGS) 7.5000 23,468
--------------- ---------------
76,003 $ 326,162
=============== ===============
--------------------------------------------------------------------------------
The accompanying notes are an integral part of these statements.
</TABLE>
LATIN AMERICAN TRUST, SERIES 1
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 1998, 1999 AND 2000
--------------------------------------------------------------------------------
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Security Valuation - Securities listed on a national or foreign securities
exchange are valued at the closing sales price or, if no such price exists, or
if the Equity Securities are not listed, at the bid price thereof.
Security Cost - The original cost to the Trust of the Securities was based,
for Securities listed on a national or foreign securities exchange on the
closing sale prices on the exchange. The cost was determined on the day of the
various Dates of Deposit.
Unit Valuation - The redemption price per Unit is the pro rata share of each
Unit based upon (1) the cash on hand in the Trust or monies in the process of
being collected, (2) the Securities in the Trust based on the value determined
in Note 1 and (3) accumulated dividends thereon, less accrued expenses of the
Trust, if any.
Federal Income Taxes - Each Unitholder is considered to be the owner of a pro
rata portion of the Trust and, accordingly, no provision has been made for
Federal Income Taxes.
NOTE 2 - PORTFOLIO
Unrealized Appreciation and Depreciation - An analysis of net unrealized
appreciation (depreciation) at August 31, 2000 is as follows:
Unrealized Appreciation $ 29,236
Unrealized Depreciation (225,496)
----------------
$ (196,260)
================
NOTE 3- OTHER
Cost to Investors - The cost to original investors was based on the
underlying value of the Securities per Unit on the date of an investor's
purchase, plus a sales charge of 5.5% of the public offering price which is
equivalent to 5.820% of the aggregate offering price of the Securities. The
secondary market cost to investors is based on the determination of the
underlying value of the Securities per Unit on the date of an investor's
purchase plus a sales charge of 5.5% of the public offering price which is
5.820% of the underlying value of the Securites. Effective on each October 23,
commencing October 23, 1997, the secondary sales charge will decrease by .5 of
1% to a minimum sales charge of 3.0%.
Compensation of Evaluator and Supervisor - The Supervisor receives a fee for
providing portfolio supervisory services for the Trust ($.007 per Unit, not to
exceed the aggregate cost of the Supervisor for providing such services to all
applicable Trusts). The Evaluator receives an annual fee for regularly
evaluating the Trust's portfolio. Both fees may be adjusted for increases under
the category "All Services Less Rent of Shelter" in the Consumer Price Index.
NOTE 4 - REDEMPTION OF UNITS
During the three years ended August 31, 1998, 1999 and 2000, 310,500 Units,
253,985 Units, and 37,884 Units, respectively, were presented for redemption.
International Assets
Advisory Corp.
Latin American Trust Prospectus Part Two
--------------------------------------------------------------------------------
The Fund. Van Kampen American Capital Equity Opportunity Trust, Series 43
(the "Fund" ) is comprised of one underlying unit investment trust designated as
the Latin American Trust, Series 1 ("the "Trust" ). The Trust offers investors
the opportunity to purchase Units representing proportionate interests in a
fixed, diversified portfolio of common stocks issued by companies that should
benefit from the economic revival and development of Latin America (the "Equity
Securities" or " Securities" ). See "Trust Portfolio." All of the Securities are
common stocks of foreign issuers, certain of which are held in American
Depositary Receipt form ("ADRs" ). The foreign common stocks which are traded on
a foreign securities exchange are referred to herein as the " Foreign
Securities." Unless terminated earlier, the Trust will terminate on January 15,
2004 (the "Mandatory Termination Date" ) 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.
Objective of the Trust. The objective of the Trust is to provide the
potential for greater than average capital appreciation and broad-based exposure
to Latin America by investing in a portfolio of equity securities issued by
companies that should benefit from the economic revival and development of Latin
America. See "Objectives and Securities Selection." There is, of course, no
guarantee that the objective of the Trust will be achieved.
Public Offering Price. The Public Offering Price of the Units of the Trust
includes the aggregate underlying value of the Securities in the Trust, the
applicable sales charge as described herein, and cash, if any, in the Income and
Capital Accounts held or owned by the Trust. The Public Offering Price per Unit
is based on the aggregate value of the Foreign Securities computed on the basis
of the bid side value of the currency exchange rate for the relevant currency
expressed in U.S. dollars. The sales charge is reduced on a graduated scale for
sales involving at least 10,000 Units. The minimum purchase is 500 Units (100
Units for a tax-sheltered retirement plan). See "Public Offering."
NOTE: THIS PROSPECTUS MAY BE USED ONLY WHEN ACCOMPANIED BY PART ONE.
Both parts of this Prospectus should be retained for future reference.
This Prospectus is dated as of the date of the Prospectus Part I
accompanying this Prospectus Part II.
--------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
Dividend and Capital Distributions. Distributions of dividends and 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" in Part One. Any distribution
of income and/or capital will be net of the expenses of the Trust. See "
Taxation." Additionally, upon surrender of Units for redemption or termination
of the Trust, the Trustee will distribute 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. Although not obligated to do so, International
Assets Advisory Corp. (the "Managing Underwriter" ) currently intends to
maintain a market for Units of the Trust and offer to repurchase Units at prices
which are based on the aggregate underlying value of Equity Securities in the
Trust (generally determined by the closing sale prices of the Securities) 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 at prices
based upon the aggregate underlying value of the Equity Securities in the Trust
plus or minus a pro rata share of cash, if any, in the Capital and Income
Accounts of the Trust. See "Rights of Unitholders--Redemption of Units."
Termination. Commencing on the Mandatory Termination Date, 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 Securities.
Written notice of any termination of the Trust 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.
Unitholders 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."
Portfolio Supervision. Van Kampen Investment Advisory Corp., the Supervisor
for the Trust, has retained Global Assets Advisors, Inc. (" Global Assets
Advisors" ) as the Sub-Supervisor to provide research to the Supervisor and
perform portfolio supervisory services for the Trust. The Sponsor believes that
this arrangement is desirable in the present circumstances due to the complexity
of the foreign equity security markets and Global Assets Advisors' expertise in
providing equity research on individual foreign equity securities, emerging
markets and the foreign equity security markets in general. The Supervisor will
pay Global Assets Advisors the entire supervisory fee for providing these
services. See "Summary of Essential Financial Information" in Part One.
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 or the general condition of the
stock market and currency fluctuations, the lack of adequate financial
information concerning an issuer, exchange control restrictions impacting
foreign issuers and risks related to an investment in Latin American companies.
For certain risk considerations related to the Trust, see "Risk Factors." Units
of the Trust are not deposits or obligations of, and are not 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 possible loss of the
principal amount invested.
THE TRUST
Van Kampen American Capital Equity Opportunity Trust, Series 43, which is
comprised of one unit investment trust, Latin American Trust, Series 1, was
created under the laws of the State of New York pursuant to a Trust Indenture
and Trust Agreement (the "Trust Agreement" ), dated the date of this Prospectus
(the "Initial Date of Deposit" ), among Van Kampen Funds Inc., as Sponsor, Van
Kampen Investment Advisory Corp., as Supervisor, The Bank of New York, as
Trustee, and American Portfolio Evaluation Services, a division of Van Kampen
Investment Advisory Corp., as Evaluator, or their predecessors.
The Trust offers investors the opportunity to purchase Units representing
proportionate interests in a portfolio of equity securities issued by companies
that should benefit from the economic revival and development of Latin America.
Unless terminated earlier, the Trust will terminate on the Mandatory
Termination Date set forth under "Summary of Essential Financial Information" in
Part One 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.
On the Initial Date of Deposit, the Sponsor deposited with the Trustee the
Securities, 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 Units of 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, the
fractional undivided interest in the Trust represented by each unredeemed Unit
will increase 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 the Managing Underwriter, or until the termination of the Trust
Agreement.
OBJECTIVE AND SECURITIES SELECTION
The objective of the Trust is to provide the potential for greater than
average capital appreciation and broad-based exposure to Latin America by
investing in a portfolio of common stocks issued by companies that should
benefit from the economic revival and development of Latin America. There is, of
course, no assurance that the Trust (which includes expenses and sales charges)
will achieve its objective. The Equity Securities selected for deposit in the
Trust were chosen by International Assets Advisory Corporation ("IAAC" ), the
Managing Underwriter. In selecting the Securities, IAAC selected companies
which, in its opinion, are financially sound and offer the potential for growth.
In particular, IAAC evaluated the Securities based on a wide range of financial
measures and performance characteristics including, among other factors, (a)
strong industry position, (b) sound balance sheet, (c) history of solid
management and (d) market liquidity.
Latin American Diversification. The Trust consists of high-quality equities
from Latin America chosen by IAAC with specific diversification parameters in
mind. The portfolio contains securities of companies diversified among a variety
of industry sectors which generally fall into the following categories:
Retail: companies involved in supermarkets, department stores and warehouse
format stores, and food and beverage producers and distributors.
Infrastructure Development: companies involved in low-cost housing, property
development, power generation and distribution, telecommunication services
and cement production
Natural Resources: companies involved in precious metals, base metals, gas and
fertilizers
Financial Services: companies involved in private banking to individuals and
corporations, asset management firms, securities firms, credit card issuers
and trade finance corporations
The Trust has been developed in such a way as to provide exposure to a
variety of industrial sectors for several major countries (Mexico, Brazil,
Argentina and Chile/Peru) as well as other Latin American countries. IAAC
believes that the portfolio offers the potential to benefit from the board-based
development of each country while maintaining diversification. Historical market
data suggests that exposure to multiple Latin stock markets helps to reduce
overall portfolio volatility and risk. Differing economic cycles, privatization
schedules, and cultural factors serve to help reduce the correlation between
markets, lowering the potential downside risk that investors could face in the
event of a country-specific downturn. IAAC believes that the ultimate goal of
global diversification is to decrease investment risk. Although the portfolio
contains only Latin American securities, when added to a portfolio of global
stocks, the Trust may help to reduce overall portfolio volatility. The Trust is
intended to supplement an investment portfolio by helping investors achieve
prudent exposure to Latin America through an investment in a portfolio of
quality growth stocks. The Trust should not be considered as a complete equity
investment program and diversification of Trust assets will not eliminate the
risk of loss always inherent in an investment in securities. See "Risk Factors."
General. Investors will be subject to taxation on the dividend income
received by the Trust and on gains from the sale or liquidation of Securities.
Investors should be aware that there is not any guarantee that the objective of
the Trust will be achieved because it is subject to the continuing ability of
the respective issuers 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
Securities will pay dividends on outstanding common shares. Any distribution 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 addition, a decrease in the value of the foreign currencies
relative to the U.S. dollar will adversely affect the value of the Trust's
assets and income and the value of the Units of the Trust. See "Risk Factors."
Investors should note that the above criteria was applied to the Securities
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 the above criteria.
Should a Security no longer meet the criteria originally established for
inclusion in the Trust, such Security will not as a result thereof be removed
from the Trust portfolio.
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. The Trust may continue to hold Securities
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 common stocks of foreign companies that should benefit
from the economic revival and development of Latin America (certain of which are
held in ADR form). All of the Equity Securities are listed on a national or
foreign securities exchange, the NASDAQ National Market or are traded in the
over-the-counter market. Each of the Securities was selected by the Managing
Underwriter based upon those factors referred to under "Objectives and
Securities Selection" above.
The Trust consists of (a) the Equity Securities (including contracts for the
purchase thereof) listed under "Portfolio" in Part One as may continue to be
held from time to time in the Trust, (b) any additional Equity 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 Equity
Securities. However, should any contract for the purchase of any of the Equity
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 Equity Securities in accordance with the Trust
Agreement, refund the cash and sales charge attributable to such failed contract
to all Unitholders on or before the next scheduled distribution date.
Investors should note that the above criteria was applied to the Equity
Securities selected by the Managing Underwriter for inclusion in the Trust
portfolio as of the date indicated above. Since the Sponsor may deposit
additional Equity Securities which were originally selected through this
process, the Sponsor and Managing Underwriter may continue to sell Units of the
Trust even though the Equity Securities would no longer be chosen for deposit
into the Trust if the selection process were to be made again at a later time.
RISK FACTORS
General. An investment in Units of the Trust should be made with an
understanding of the risks which an investment in common stocks of foreign
issuers 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, and 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 each
issuer's board of directors and have a right to participate in amounts available
for distribution by such issuer only after all other claims on such issuer have
been paid or provided for. 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.
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 or foreign
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 or the
Managing Underwriter. The price at which the Equity Securities may be sold to
meet redemption, and the value of the Trust, will be adversely affected if
trading markets for the Equity Securities are limited or absent.
Unitholders will be unable to dispose of any of the Equity Securities in the
Trust, 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 (who may rely on the Supervisor). In the absence of
any such instructions, the Trustee will vote such Securities so as to insure
that the Securities 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.
Foreign Equity Risks. Since the Equity Securities consist of securities of
foreign issuers, an investment in the Trust involves certain investment risks
that are different in some respects from an investment in a trust which invests
entirely in the securities of domestic issuers. These investment risks include
future political or governmental restrictions which might adversely affect the
payment or receipt of payment of dividends on the relevant Equity Securities,
the possibility that the financial condition of the issuers of the Equity
Securities may become impaired or that the general condition of the relevant
stock market may worsen (both of which would contribute directly to a decrease
in the value of the Equity Securities and thus in the value of the Units), the
limited liquidity and relatively small market capitalization of the relevant
securities market, expropriation or confiscatory taxation, economic
uncertainties and foreign currency devaluations and fluctuations. In addition,
for foreign issuers that are not subject to the reporting requirements of the
Securities Exchange Act of 1934, there may be less publicly available
information than is available from a domestic issuer. Also, foreign issuers are
not necessarily subject to uniform accounting, auditing and financial reporting
standards, practices and requirements comparable to those applicable to domestic
issuers. The securities of many foreign issuers are less liquid and their prices
more volatile than securities of comparable domestic issuers. In addition, fixed
brokerage commissions and other transaction costs on foreign securities
exchanges are generally higher than in the United States and there is generally
less government supervision and regulation of exchanges, brokers and issuers in
foreign countries than there is in the United States. However, due to the nature
of the issuers of the Equity Securities, the Sponsor believes that adequate
information will be available to allow the Supervisor to provide portfolio
surveillance for the Trust.
Equity securities issued by non-U.S. issuers generally pay dividends in
foreign currencies and are principally traded in foreign currencies. Therefore,
there is a risk that the United States dollar value of these securities will
vary with fluctuations in the U.S. dollar foreign exchange rates for the various
Equity Securities. See "Exchange Rate" below. Investors should also realize
that, although certain Equity Securities are ADRs, all foreign issuers which
operate internationally are subject to currency risks.
The securities of certain foreign issuers in the Trust are in ADR form
(including Global Depositary Receipts). See "Portfolio" in Part One. ADRs
evidence American Depositary Receipts which represent common stock deposited
with a custodian in a depositary. American Depositary Shares, and receipts
therefor (ADRs), are issued by an American bank or trust company to evidence
ownership of underlying securities issued by a foreign corporation. These
instruments may not necessarily be denominated in the same currency as the
securities into which they may be converted. For purposes of the discussion
herein, the term ADR generally includes American Depositary Shares. ADRs may be
sponsored or unsponsored. In an unsponsored facility, the depositary initiates
and arranges the facility at the request of market makers and acts as agent for
the ADR holder, while the company itself is not involved in the transaction. In
a sponsored facility, the issuing company initiates the facility and agrees to
pay certain administrative and shareholder-related expenses. Sponsored
facilities use a single depositary and entail a contractual relationship between
the issuer, the shareholder and the depositary; unsponsored facilities involve
several depositaries with no contractual relationship to the company. The
depositary bank that issues an ADR generally charges a fee, based on the price
of the ADR, upon issuance and cancellation of the ADR. This fee would be in
addition to the brokerage commissions paid upon the acquisition or surrender of
the security. In addition, the depositary bank incurs expenses in connection
with the conversion of dividends or other cash distributions paid in local
currency into U.S. dollars and such expenses are deducted from the amount of the
dividend or distribution paid to holders, resulting in a lower payout per
underlying shares represented by the ADR than would be the case if the
underlying share were held directly. The Trustee for this Trust acts as a
depositary for ADRs, certain of which may be included in the Trust's portfolio.
Certain tax considerations, including tax rate differentials and withholding
requirements, arising from applications of the tax laws of one nation to
nationals of another and from certain practices in the ADR market may also exist
with respect to certain ADRs. In varying degrees, any or all of these factors
may affect the value of the ADR compared with the value of the underlying shares
in the local market. In addition, the rights of holders of ADRs may be different
than those of holders of the underlying shares, and the market for ADRs may be
less liquid than that for the underlying shares. ADRs are registered securities
pursuant to the Securities Act of 1933 and may be subject to the reporting
requirements of the Securities Exchange Act of 1934.
On the basis of the best information available to the Sponsor at the present
time, none of the Equity Securities are subject to exchange control restrictions
under existing law which would materially interfere with payment to the Trust of
dividends due on, or proceeds from the sale of, the Equity Securities. However,
there can be no assurance that exchange control regulations might not be adopted
in the future which might adversely affect payment to the Trust. In addition,
the adoption of exchange control regulations and other legal restrictions could
have an adverse impact on the marketability of international securities in the
Trust and on the ability of the Trust to satisfy its obligation to redeem Units
tendered to the Trustee for redemption.
Investors should be aware that it may not be possible to buy all of the
Equity Securities at the same time because of the unavailability of any Equity
Security, and restrictions applicable to the Trust relating to the purchase of
an Equity Security by reason of the federal securities laws or otherwise.
Foreign securities generally have not been registered under the Securities
Act of 1933 and may not be exempt from the registration requirements of such
Act. Sales of non-exempt Equity Securities by the Trust in the United States
securities markets are subject to severe restrictions and may not be
practicable. Accordingly, sales of these Equity Securities by the Trust will
generally be effected only in foreign securities markets. Although the Sponsor
does not believe that the Trust will encounter obstacles in disposing of the
Equity Securities, investors should realize that the Equity Securities may be
traded in foreign countries where the securities markets are not as developed or
efficient and may not be as liquid as those in the United States. The value of
the Equity Securities will be adversely affected if trading markets for the
Equity Securities are limited or absent.
Latin America. Investment in securities issued by Latin American companies
involves risks not typically associated with investments in securities of U.S.
companies. See "Foreign Equity Risks" above. Certain of these risks include high
rates of inflation and interest, the limited liquidity and relatively small
market capitalization of the Latin American securities markets, potential delays
in settlement transactions, high correlation of performance among markets,
higher price volatility, restrictions on foreign investment, political and
social uncertainties, governmental involvement in the economy, significant
foreign currency devaluations and fluctuations, low or negative rates of growth,
declining savings and investment, capital flight and excessive domestic and
foreign indebtedness. Although there have been significant improvements in
recent years, the Latin American economies continue to experience significant
problems, including high inflation rates and high interest rates. The emergence
of the Latin American economies and securities markets will require economic and
fiscal discipline and stable political and social conditions, all of which have
been lacking at times in the past. Recovery will be influenced by international
economic conditions, particularly those in the United States, and by world
prices for oil and other commodities. There is no assurance that current
economic initiatives will be successful.
Exchange Rates. The Trust is concentrated in Equity Securities that are
principally traded in foreign currencies and as such involves investment risks
that are substantially different from an investment in a fund which invests in
securities that are traded only in United States dollars. The United States
dollar value of the portfolio (and hence of the Units) and of the distributions
from the portfolio will vary with fluctuations in the United States dollar
foreign exchange rates for the related foreign currencies. Most foreign
currencies have fluctuated widely in value against the United States dollar for
many reasons, including supply and demand of the respective currency, the rate
of inflation in the respective economies compared to the United States, the
impact of interest rate differentials between different currencies on the
movement of foreign currency rates, the balance of imports and exports of goods
and services, the soundness of the world economy and the strength of the
respective economy as compared to the economies of the United States and other
countries.
The post-World War II international monetary system was, until 1973,
dominated by the Bretton Woods Treaty, which established a system of fixed
exchange rates and the convertibility of the United States dollar into gold
through foreign central banks. Starting in 1971, growing volatility in the
foreign exchange markets caused the United States to abandon gold convertibility
and to effect a small devaluation of the United States dollar. In 1973, the
system of fixed exchange rates between a number of the most important industrial
countries of the world, among them the United States and most western European
countries, was completely abandoned. Subsequently, major industrialized
countries have adopted "floating" exchange rates, under which daily currency
valuations depend on supply and demand in a freely fluctuating international
market. Many smaller or developing countries have continued to "peg" their
currencies to the United States dollar although there has been some interest in
recent years in "pegging" currencies to " baskets" of other currencies or to a
Special Drawing Right administered by the International Monetary Fund.
Currencies are generally traded by leading international commercial banks and
institutional investors (including corporate treasurers, money managers, pension
funds and insurance companies). From time to time, central banks in a number of
countries also are major buyers and sellers of foreign currencies, mostly for
the purpose of preventing or reducing substantial exchange rate fluctuations.
Exchange rate fluctuations are partly dependent on a number of economic
factors including economic conditions within countries, the impact of actual and
proposed government policies on the value of currencies, interest rate
differentials between the currencies and the balance of imports and exports of
goods and services and transfers of income and capital from one country to
another. These economic factors are influenced primarily by a particular
country's monetary and fiscal policies (although the perceived political
situation in a particular country may have an influence as well--particularly
with respect to transfers of capital). Investor psychology may also be an
important determinant of currency fluctuations in the short run. Moreover,
institutional investors trying to anticipate the future relative strength or
weakness of a particular currency may sometimes exercise considerable
speculative influence on currency exchange rates by purchasing or selling large
amounts of the same currency or currencies. However, over the long term, the
currency of a country with a low rate of inflation and a favorable balance of
trade should increase in value relative to the currency of a country with a high
rate of inflation and deficits in the balance of trade.
The Evaluator will estimate the current exchange rate for the appropriate
foreign currencies based on activity in the related currency exchange market.
However, since this market may be volatile and is constantly changing, depending
on the activity at any particular time of the large international commercial
banks, various central banks, large multi-national corporations, speculators and
other buyers and sellers of foreign currencies, and since actual foreign
currency transactions may not be instantly reported, the exchange rates
estimated by the Evaluator may not be indicative of the amount in United States
dollars the Trust would receive had the Trustee sold any particular currency in
the market. The foreign exchange transactions of the Trust will be concluded by
the Trustee with foreign exchange dealers acting as principals on a spot (i.e.,
cash) buying basis. Although foreign exchange dealers trade on a net basis, they
do realize a profit based upon the difference between the price at which they
are willing to buy a particular currency (bid price) and the price at which they
are willing to sell the currency (offer price).
TAXATION
General. 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 Code of 1986, as amended (the "Code"). Unitholders should
consult their tax advisers in determining the federal, state, local and any
other tax consequences of the purchase, ownership and disposition of Units in
the Trust. For purposes of the following discussion and opinions, it is assumed
that each Security is equity for federal income tax purposes. In the opinion of
Chapman and Cutler, special counsel for the Sponsor, under existing law:
1. The Trust is not an association taxable as a corporation for federal
income tax purposes; each Unitholder will be treated as the owner of a pro rata
portion of each of the assets of the Trust under the Code; and the income of the
Trust will be treated as income of the Unitholders thereof under the Code. Each
Unitholder will be considered to have received his pro rata share of income
derived from each Security when such income is considered to be received by the
Trust.
2. A Unitholder will be considered to have received all of the dividends paid
on his pro rata portion of each Security when such dividends are considered to
be received by the Trust regardless of whether such dividends are used to pay a
portion of any deferred sales charge imposed. Unitholders will be taxed in this
manner regardless of whether distributions from the Trust are actually received
by the Unitholder or are automatically reinvested (see "Rights of
Unitholders--Reinvestment Option").
3. Each Unitholder will have a taxable event when the Trust disposes of a
Security (whether by sale, exchange, liquidation, redemption, or otherwise) or
upon the sale or redemption of Units by such Unitholder (except to the extent an
in kind distribution of stock is received by such Unitholder from the Trust as
described below). The price a Unitholder pays for his Units, generally including
sales charges, is allocated among his pro rata portion of each Security held by
the Trust (in proportion to the fair market values thereof on the valuation date
closest to the date the Unitholder purchases his Units) in order to determine
his initial tax basis for his pro rata portion of each Security held by the
Trust. Unitholders should consult their own tax advisers with regard to the
calculation of basis. For federal income tax purposes, a Unitholder's pro rata
portion of the dividends, as defined by Section 316 of the Code, paid by a
corporation with respect to a Security held by the Trust is taxable as ordinary
income to the extent of such corporation's current and accumulated "earnings and
profits". A Unitholder's pro rata portion of dividends paid on such Security
which exceed such current and accumulated earnings and profits will first reduce
a Unitholder's tax basis in such Security, and to the extent that such dividends
exceed a Unitholder's tax basis in such Security shall generally be treated as
capital gain. In general, the holding period for such capital gain will be
determined by the period of time a Unitholder has held his Units.
4. A Unitholder's portion of gain, if any, upon the sale or redemption of
Units or the disposition of Securities held by the Trust will generally be
considered a capital gain (except in the case of a dealer or a financial
institution). A Unitholder's portion of loss, if any, upon the sale or
redemption of Units or the disposition of Securities held by the Trust will
generally be considered a capital loss (except in the case of a dealer or a
financial institution). Unitholders should consult their tax advisers regarding
the recognition of gains and losses for federal income tax purposes. Unitholders
should consult their tax advisers regarding the recognition of gains and losses
for federal income tax purposes.
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, and are
attributable to domestic corporations) in the same manner as if such corporation
directly owned the Securities paying such dividends (other than corporate
Unitholders, such as "S" corporations, which are not eligible for the deduction
because of their special characteristics and other than for purposes of special
taxes such as the accumulated earnings tax and the personal holding corporation
tax). However, a corporation owning Units should be aware that Sections 246 and
246A of the Code impose additional limitations on the eligibility of dividends
for the 70% dividends received deduction. These limitations include a
requirement that stock (and therefore Units) must generally be held at least 46
days (as determined under Section 246(c) of the Code). Final regulations have
been issued which address special rules that must be considered in determining
whether the 46 day holding period requirement is met. Moreover, the allowable
percentage of the deduction will be reduced from 70% if a corporate Unitholder
owns certain stock (or Units) the financing of which is directly attributable to
indebtedness incurred by such corporation.
To the extent dividends received by the Trust are attributable to foreign
corporations, a corporation that owns Units will not be entitled to the
dividends received deduction with respect to its pro rata portion of such
dividends, since the dividends received deduction is generally available only
with respect to dividends paid by domestic corporations. Unitholders should
consult their tax advisors with respect to the limitations on and modifications
to the dividends received deduction.
Limitations on Deductibility of Trust Expenses by Unitholders. Each
Unitholder's pro rata share of each expense paid by the Trust is deductible by
the Unitholder to the same extent as though the expense had been paid directly
by him. As a result of the Tax Reform Act of 1986, certain miscellaneous
itemized deductions, such as investment expenses, tax return preparation fees
and employee business expenses will be deductible by an individual only to the
extent they exceed 2% of such individual's adjusted gross income. Unitholders
may be required to treat some or all of the expenses of a Trust as miscellaneous
itemized deductions subject to this limitation.
Recognition of Taxable Gain or Loss Upon Disposition of Securities by the
Trust or Disposition of Units. As discussed above, a Unitholder may recognize
taxable gain (or loss) when a Security is disposed of by the Trust or if the
Unitholder disposes of a Unit. The Internal Revenue Service Restructuring and
Reform Act of 1998 (the "1998 Tax Act") provides that for taxpayers other than
corporations, net capital gain (which is defined as net long-term capital gain
over net short-term capital loss for the taxable year) realized from property
(with certain exclusions) is subject to a maximum marginal stated tax rate of
20% (10% in the case of certain taxpayers in the lowest tax bracket). Capital
gain or loss is long-term if the holding period for the asset is more than one
year, and is short-term if the holding period for the asset is one year or less.
The date on which a Unit is acquired (i.e., the "trade date") is excluded for
purposes for determining the holding period of the Unit. Capital gains realized
from assets held for one year or less are taxed at the same rates as ordinary
income.
In addition, please note that capital gains may be recharacterized as
ordinary income in the case of certain financial transactions that are
considered "conversion transactions" effective for transactions entered into
after April 30, 1993. Unitholders and prospective investors should consult with
their tax advisers regarding the potential effect of this provision on their
investment in Units.
If a Unitholder disposes of a Unit he is deemed thereby to have disposed of
his entire pro rata interest in all assets of the Trust involved including his
pro rata portion of all Securities represented by a Unit. The Taxpayer Relief
Act of 1997 (the "1997 Tax Act") includes provisions that treat certain
transactions designed to reduce or eliminate risk of loss and opportunities for
gain (e.g., short sales, offsetting notional principal contracts, futures or
forward contracts, or similar transactions) as constructive sales for purposes
of recognition of gain (but not loss) and for purposes of determining the
holding period. Unitholders should consult their own tax advisers with regard to
any such constructive sales rules.
Computation of the Unitholder's Tax Basis. Initially, a Unitholder's tax
basis in his Units will generally equal the price paid by such Unitholder for
his Units. The cost of the Units is allocated among the Securities held in the
Trust in accordance with the proportion of the fair market values of such
Securities on the valuation date nearest the date the Units are purchased in
order to determine such Unitholder's tax basis for his pro rata portion of each
Security.
A Unitholder's tax basis in his Units and his pro rata portion of a Security
held by the Trust will be reduced to the extent dividends paid with respect to
such Security are received by the Trust which are not taxable as ordinary income
as described above.
Other Matters. Each Unitholder will be requested to provide the Unitholder's
taxpayer identification number to the Trustee and to certify that the Unitholder
has not been notified that payments to the Unitholder are subject to back-up
withholding. If the proper taxpayer identification number and appropriate
certification are not provided when requested, distributions by the Trust to
such Unitholder (including amounts received upon the redemption of Units) will
be subject to back-up withholding. Distributions by the Trust (other than those
that are not treated as United States source income, if any) will generally be
subject to United States income taxation and withholding in the case of Units
held by non-resident alien individuals, foreign corporations or other non-United
States persons. Such persons should consult their tax advisers.
In general, income that is not effectively connected to the conduct of a
trade or business within the United States that is earned by non-U.S.
Unitholders and derived from dividends of foreign corporations will not be
subject to U.S. withholding tax provided that less than 25 percent of the gross
income of the foreign corporation for a three-year period ending with the close
of its taxable year preceding payment was not effectively connected to the
conduct of a trade or business within the United States. In addition, such
earnings may be exempt from U.S. withholding pursuant to a specific treaty
between the United States and a foreign country. Non-U.S. Unitholders should
consult their own tax advisers regarding the imposition of U.S. withholding on
distributions from the Trust.
It should be noted that payments to the Trust of dividends on Securities that
are attributable to foreign corporations may be subject to foreign withholding
taxes and Unitholders should consult their tax advisers regarding the potential
tax consequences relating to the payment of any such withholding taxes by the
Trust. Any dividends withheld as a result thereof will nevertheless be treated
as income to the Unitholders. Because, under the grantor trust rules, an
investor is deemed to have paid directly his share of foreign taxes that have
been paid or accrued, if any, an investor may be entitled to a foreign tax
credit or deduction for United States tax purposes with respect to such taxes.
The 1997 Tax Act imposes a required holding period for such credits. Investors
should consult their tax advisers with respect to foreign withholding taxes and
foreign tax credits.
At the termination of the Trust, the Trustee will furnish to each Unitholder
of the Trust a statement containing information relating to the dividends
received by the Trust on the Securities, the gross proceeds received by the
Trust from the disposition of any Security (resulting from redemption or the
sale of any Security), and the fees and expenses paid by the Trust. The Trustee
will also furnish annual information returns to Unitholders and to the Internal
Revenue Service.
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 special counsel for New York tax matters, the Trust is not
an association taxable as a corporation and the income of the Trust will be
treated as the income of the Unitholders under the existing income tax laws of
the State and City of New York.
The foregoing discussion relates only to the tax treatment of U.S.
Unitholders ("U.S. Unitholders") with regard to federal and certain aspects of
New York State and City income taxes. Unitholders may be subject to taxation in
New York or in other jurisdictions and should consult their own tax advisers in
this regard. As used herein, the term "U.S. Unitholder" means an owner of a Unit
in the Trust that (a) is (i) for United States federal income tax purposes a
citizen or resident of the United States, (ii) a corporation, partnership or
other entity created or organized in or under the laws of the United States or
of any political subdivision thereof, or (iii) an estate or trust the income of
which is subject to United States federal income taxation regardless of its
source or (b) does not qualify as a U.S. Unitholder in paragraph (a) but whose
income from a Unit is effectively connected with such Unitholder's conduct of a
United States trade or business. The term also includes certain former citizens
of the United States whose income and gain on the Units will be taxable.
Unitholders should consult their tax advisers regarding potential foreign, state
or local taxation with respect to the Units.
TRUST OPERATING EXPENSES
Initial Costs. All costs and expenses incurred in creating and establishing
the Trust, including the cost of the initial preparation, printing and execution
of the Trust Agreement and the certificates, legal and accounting expenses,
advertising and selling expenses, expenses of the Trustee, initial fees of an
evaluator and other out-of-pocket expenses have been borne by the Sponsor at no
cost to the Fund.
Compensation of Sponsor and Evaluator. The Sponsor will not receive any fees
in connection with its activities relating to the Trust. However, Van Kampen
Investment Advisory Corp., which is an affiliate of the Sponsor, will receive an
annual supervisory fee, payable in monthly installments, which is not to exceed
the amount set forth under "Summary of Essential Financial Information" in Part
One, 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) 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 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. Pursuant to a contract with the
Supervisor, Global Assets Advisors, Inc., a non-affiliated firm regularly
engaged in the business of evaluating, quoting or appraising comparable
securities, provides, for both the initial offering period and secondary market
transactions, portfolio supervisory services for the Trust and receives for such
services the entire supervisory fee paid to the Supervisor. In addition,
American Portfolio Evaluation Services, which is a division of Van Kampen
Investment Advisory Corp., shall receive for regularly providing evaluation
services to the Trust the annual per Unit evaluation fee, payable in monthly
installments, set forth under "Summary of Essential Financial Information" in
Part One (which is based on the number of Units of the Trust outstanding on
January 1 of each year for which such compensation relates) 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 and the Managing
Underwriter will receive sales commissions and the Managing Underwriter 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 and
Managing Underwriter Compensation" .
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"
in Part One (which is based on the number of Units of the Trust outstanding on
January 1 of each year for which such compensation relates) and, in connection
with certain Equity Securities held in sub-custodian accounts, certain
additional amounts. 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 to the Trust 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. The following additional charges are or may be
incurred by the Trust: (a) normal expenses (including the cost of mailing
reports to Unitholders) incurred in connection with the operation of the Trust,
(b) fees of the Trustee for extraordinary services, (c) expenses of the Trustee
(including legal and auditing expenses) and of counsel designated by the
Sponsor, (d) various governmental charges, (e) expenses and costs of any action
taken by the Trustee to protect the Trust and the rights and interests of
Unitholders, (f) indemnification of the Trustee for any loss, liability or
expenses incurred in the administration of the Trust without negligence, bad
faith or wilful misconduct on its part, (g) foreign custodial and transaction
fees and (h) expenditures incurred in contacting Unitholders upon termination of
the Trust. The expenses set forth herein are payable as described under
"General" below. The Trust may pay the cost of updating its registration
statement each year. Unit investment trust sponsors have historically paid these
costs.
General. All of the fees and expenses of the Trust will accrue on a daily
basis. When such fees and expenses are paid by or owing to the Trustee, they are
secured by a lien on the Trust's portfolio. Since the Equity Securities are all
common stocks, and the income stream produced by dividend payments is
unpredictable, the Sponsor cannot provide any assurance that dividends will be
sufficient to meet any or all expenses of the Trust. If the balances in the
Income and Capital Accounts are insufficient to provide for amounts payable by
the Trust, the Trustee has the power to sell Equity Securities to pay such
amounts. These sales may result in capital gains or losses to Unitholders. See
"Taxation."
PUBLIC OFFERING
General. Units are offered at the Public Offering Price. The secondary market
public offering price is based on the aggregate underlying value of the
Securities in the Trust, an applicable sales charge (which is initially 5.50% of
the Public Offering Price and is reduced by .5 of 1% on each October 23
commencing October 23, 1997, to a minimum sales charge of 3.0%), and cash, if
any, in the Income and Capital Accounts held or owned by the Trust. The
aggregate underlying value of the Securities is based on the U.S. dollar value
of the Foreign Securities computed on the basis of the bid side value of the
related currency exchange rate expressed in U.S. dollars as of the Evaluation
Time. The sales charge applicable to quantity purchases is, reduced on a
graduated basis to any person acquiring 10,000 or more Units as follows:
Aggregate Number of Units Purchased Sales Charge Reduction Per Unit
----------------------------------- -------------------------------
10,000-24,999 0.60%
25,000-49,999 0.90
50,000-99,999 1.30
100,000 or more 2.10
The sales charge reduction will primarily be the responsibility of the
selling Managing Underwriter, broker, dealer or agent. A Unitholder who
purchases additional Units of the Trust may obtain a reduced sales charge
through a right of accumulation on current purchases of Units. The applicable
sales charge on such additional purchases will be determined based on the total
of (a) the number of Units currently purchased plus (b) the total number of
Units previously purchased. The following purchases may be aggregated for
purposes of determining the total number of Units purchased: (i) individual
purchases on behalf of a single purchaser, the purchaser's spouse and the
purchaser's children under the age of 21 years; (ii) purchases in connection
with an employee benefits plan exclusively for the benefit of such individuals,
such as an IRA, individual plan under Internal Revenue Code section 403(b) or a
single-participant Keogh-type plan; and (iii) purchases made by a company
controlled by such individuals.
Registered representatives of the Managing Underwriter may purchase Units of
the Trust at the current Public Offering Price less the underwriting commission
during the initial offering period, and less the dealer's concession for
secondary market transactions. 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.
Offering Price. The Public Offering Price of the Units will vary from the
amounts stated under "Summary of Essential Financial Information" in Part One in
accordance with fluctuations in the prices of the underlying Securities in the
Trust. The aggregate underlying value of the Securities is based on the U.S.
dollar value of the Foreign Securities computed on the basis of the bid side
value of the related currency exchange rate expressed in U.S. dollars.
As indicated above, the price of the Units was established by adding to the
determination of the aggregate underlying value of the Securities in the Trust
an amount equal to the sales charge and dividing the sum so obtained by the
number of Units in the Trust outstanding. The Public Offering Price shall
include the proportionate share of any cash held in the Income and Capital
Accounts in the Trust. The Evaluator on each business day (except as stated
below) will appraise or cause to be appraised the value of the underlying
Securities in the Trust as of the Evaluation Time 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 Managing Underwriter
for purchases, sales or redemptions after the Evaluation Time, or on a day which
is not a business day for the Trust, will be held until the next determination
of price. No such evaluation shall be made on any date on which Securities
representing greater than 33% of the aggregate value of the Trust are not traded
on the principal trading exchange for such Securities due to a customary
business holiday on such exchange. Accordingly, purchases or redemptions of
Units on such a day will be based on the next determination of price of the
Securities (and the price of such Units would be the next computed price).
The value of the Equity Securities is determined on each business day by the
Evaluator as described under "Rights of Unitholders--Redemption of Units"..
In offering the Units to the public, neither the Sponsor, the Managing
Underwriter 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. Units will be distributed to the public by the Managing
Underwriter, broker-dealers and others at the Public Offering Price. Units
repurchased in the secondary market, if any, may be offered by this Prospectus
at the secondary market Public Offering Price in the manner described above.
It is the intention of the Sponsor to qualify Units of the Trust for sale in
a number of states. For secondary market transactions, brokers, dealers or banks
will receive a concession or agency commission equal to 3.6% of the Public
Offering Price. However, resale of Units of the Trust by such Managing
Underwriter, dealers and others to the public will be made at the Public
Offering Price described in the then current prospectus.
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 500 Units (100 Units for a
tax-sheltered retirement plan). The Managing Underwriter 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 and Managing Underwriter Compensation. The Managing Underwriter will
receive the gross sales commission equal to the total sales charge imposed on
Units, less any reduced sales charge for quantity purchases as described under
"General" above. Any such quantity discount provided to investors will be borne
by the Managing Underwriter or the selling dealer or agent.
In addition, the Managing Underwriter realized a profit or loss, as the case
be, as a result of the difference between the price paid for the Securities by
the Managing Underwriter and the cost of such Securities to the Trust on the
Initial Date of Deposit as well as on subsequent deposits. The Sponsor and
Managing Underwriter have 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 Managing Underwriter may
further realize additional profit or loss 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
Managing Underwriter.
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 or
Managing Underwriter prior to the date of settlement for the purchase of Units
may be used in the Sponsor's or the Managing Underwriter's business and may be
deemed to be a benefit to the Sponsor or Managing Underwriter, subject to the
limitations of the Securities Exchange Act of 1934.
As stated under "Public Market" below, the Managing Underwriter currently
intends to maintain a secondary market for Units of the Trust. In so maintaining
a market, the Managing Underwriter 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 Managing Underwriter or 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 not obligated to do so, the Managing
Underwriter currently 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 (computed as indicated under "Offering Price" above and "Rights of
Unitholders--Redemption of Units" ). The aggregate underlying value of the
Foreign Securities is computed on the basis of the bid side value of the related
currency exchange rate expressed in U.S. dollars. If the supply of Units exceeds
demand or if some other business reason warrants it, the Managing Underwriter
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 will be able to dispose of such Units 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.
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. The minimum purchase in connection with a
tax-sheltered retirement plan is 100 Units.
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 book entry unless a
Unitholder or the Unitholder's registered broker-dealer makes a written request
to the Trustee that ownership be evidenced by certificates. 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 of the Trust. Other receipts (e.g., capital gains, proceeds from
the sale of Securities, etc.) are credited to the Capital Account of the Trust.
Dividends with respect to the Foreign Securities to be credited to such accounts
are first converted into U.S. dollars at the applicable exchange rate.
The Trustee will distribute any net 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" in Part One. Proceeds received on the sale of
any Securities in the Trust, to the extent not used to meet redemptions of Units
or pay expenses, will be distributed annually on the Capital Account
Distribution Date to Unitholders of record on the preceding Capital Account
Record Date. 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 of the Trust and not distributed until the next distribution
date applicable to the 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 after deducting
estimated expenses. 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.
The Trustee will periodically deduct from the Income Account and, to the
extent funds are not sufficient therein, from the Capital Account of the Trust
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
said 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 of the Trust such amounts as may be necessary to cover redemptions of
Units.
Reports Provided. The Trustee shall furnish Unitholders of the Trust 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 of the Trust outstanding. 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 of
the Trust a statement (i) as to the Income Account: income received, 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 by such Trust and the number
of Units of the Trust outstanding on the last business day of such calendar
year; (iv) the Redemption Price per Unit of the Trust 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 of
the Trust, 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 as described above (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 and converted
into U.S. dollars as of the Evaluation Time set forth under " Summary of
Essential Financial Information" in Part One. The "date of tender" is deemed to
be the date of the next computation of the net asset value per Unit after Units
are received by the Trustee for redemption. No such computation shall be made on
any day on which Securities representing greater than 33% of the aggregate value
of the Trust are not traded on the principal trading exchange for such
Securities due to a customary business holiday on such exchange. Accordingly,
purchases or redemptions of Units on such a day will be based on the next
determination of price of the Securities (and the price of such Units would be
the next computed price). Foreign securities exchanges are open for trading on
certain days which are U.S. holidays on which the Trust will not transact
business. The Foreign Securities will continue to trade on those days and thus
the value of the Trust may be significantly affected on days when a Unitholder
cannot sell or redeem his Units.
The Trustee is empowered to sell Securities of the Trust in order to make
funds available for redemption if funds are not otherwise available in the
Capital and Income Accounts of the Trust 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.
The Redemption Price per Unit and the secondary market repurchase price per
Unit are equal to the pro rata share of each Unit in the Trust, determined on
the basis of (i) the cash on hand in the Trust, (ii) the value of the Securities
in the Trust and (iii) dividends receivable on the Securities in the Trust
trading ex-dividend as of the date of computation, less (a) amounts representing
taxes or other governmental charges payable out of the Trust and (b) the accrued
expenses of the Trust. During the initial offering period, the redemption price
and the secondary market repurchase price will also include estimated
organizational costs. For these purposes, the Evaluator may determine the value
of the Securities in the following manner. If the Securities are listed on a
national or foreign securities exchange or The Nasdaq Stock Market, this
evaluation is generally based on the closing sale prices on that exchange or
market (unless it is determined that these prices are inappropriate as a basis
for valuation) or, if there is no closing sale price on that exchange or market,
at the closing bid prices. If the Securities are not so listed or, if so listed
and the principal market therefor is other than on the exchange or market, the
evaluation may be based on the current bid price on the over-the-counter market.
If current bid prices are unavailable or inappropriate, the evaluation may be
determined (a) on the basis of current bid prices for comparable securities, (b)
by appraising the Securities on the bid side of the market or (c) by any
combination of the above. The value of any foreign securities is based on the
applicable currency exchange rate in U.S. dollars as of the Evaluation Time.
The right of redemption may be suspended and payment postponed for any period
during which the New York Stock Exchange is closed, other than for customary
weekend and holiday closings, or any period during which the 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
Managing Underwriter Purchases of Units. The Trustee shall notify the
Managing Underwriter of any Units tendered for redemption. If the Managing
Underwriter'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 Managing
Underwriter may be tendered to the Trustee for redemption as any other Units.
The offering price of any Units acquired by the Managing Underwriter 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 Managing Underwriter 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.
While the Trust will not be managed, the Trust Agreement does provide 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 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).
Proceeds from the sale of Securities (or any securities or other property
received by the Trust in exchange for Equity Securities) are credited to the
Capital Account for distribution to Unitholders or to meet redemptions. 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.
As indicated under "Rights of Unitholders--Redemption of Units" above, the
Trustee may also sell Securities designated by the Supervisor, or if no such
designation has been made, in its own discretion, for the purpose of redeeming
Units of the Trust tendered for redemption and the payment of expenses.
When the Trust sells Securities, the composition and diversity of the Equity
Securities in the Trust may be altered. In order to obtain the best price for
the Trust, it may be necessary for the Supervisor to specify minimum amounts
(generally 100 shares) in which blocks of Equity Securities are to be sold. In
effecting purchases and sales of the Trust's portfolio securities, the Sponsor
may direct that orders be placed with and brokerage commissions be paid to
brokers, including brokers which may be affiliated with the Trust, the Sponsor
or dealers participating in the offering of Units. In addition, in selecting
among firms to handle a particular transaction, the Sponsor may take into
account whether the firm has sold or is selling units of unit investment trusts
which it sponsors.
Amendment 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
representing 51% of the Units of the Trust 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 Units of the Trust then outstanding, or by the
Trustee when the value of the Equity Securities owned by the Trust, as shown by
any evaluation, is less than that amount set forth under Minimum Termination
Value in " Summary of Essential Financial Information" in Part One. The Trust
will be liquidated by the Trustee in the event that a sufficient number of Units
of the Trust not yet sold are tendered for redemption by the Managing
Underwriter or 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 by the Sponsor and/or the Managing Underwriter, 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" in
Part One.
Commencing nine business days before, but no later than, the Mandatory
Termination Date, Equity Securities may 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 Securities in such manner as to effectuate orderly sales and a
minimal market impact. In the event the Sponsor does not so direct, the
Securities shall be sold within a reasonable period and in such manner as the
Trustee, in its sole discretion, shall determine. At least 30 days before the
Mandatory Termination Date the Trustee will provide written notice of any
termination to all Unitholders of the Trust. Unitholders will receive a cash
distribution from the sale of the remaining Securities within a reasonable time
following the Mandatory Termination Date. The Trustee will deduct from the funds
of the Trust any accrued costs, expenses, advances or indemnities provided by
the Trust Agreement, including estimated compensation of the Trustee, costs of
liquidation and any amounts required as a reserve to provide for payment of any
applicable taxes or other governmental charges. Any sale of Securities in the
Trust upon termination may result in a lower amount than might otherwise be
realized if such sale were not required at such time. The Trustee will then
distribute to each Unitholder of the Trust his pro rata share of the balance of
the Income and Capital Accounts of the Trust.
Within 60 days after the final distribution Unitholders will be furnished a
final distribution statement of the amount distributable. At such time as the
Trustee in its sole discretion will determine that any amounts held in reserve
are no longer necessary, it will make distribution thereof to Unitholders in the
same manner.
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.
Managing Underwriter and Sub-Supervisor. International Assets Advisory
Corporation ("IAAC" ), the Managing Underwriter for the Trust, is a full-service
securities brokerage firm specializing in global investing. IAAC was formed as a
Florida corporation in 1981 and registered as a broker/dealer in 1982. The firm
has focused on the sale of global debt and equity securities to its clients.
IAAC has developed an experienced team specializing in the selection, research,
trading, currency exchange and execution of individual equity and fixed-income
products on a global basis. Members of this team are also affiliated with Global
Assets Advisors, Inc. and have many years of experience in the global
marketplace. Global Assets Advisors, Inc., is the Sub-Supervisor and provides
research and portfolio supervisory services for the Trust pursuant to a contract
with the Supervisor. Global Assets Advisors is a wholly-owned subsidiary of
International Assets Holding Corporation and a related corporation of IAAC. The
principal offices of IAAC and Global Assets Advisors are located at 250 Park
Avenue South, Suite 200, Winter Park, Florida 32789. The telephone number is
(800) 432-0000.
Sponsor. Van Kampen Funds Inc., a Delaware corporation, is the Sponsor of
your Trust. The Sponsor is an indirect subsidiary of Van Kampen Investments Inc.
Van Kampen Investments Inc. is a wholly owned subsidiary of MSAM Holdings II,
Inc., which in turn is a wholly owned subsidiary of Morgan Stanley Dean Witter &
Co.
Morgan Stanley Dean Witter & Co., together with various of its directly and
indirectly owned subsidiaries, is engaged in a wide range of financial services
through three primary businesses: securities, asset management and credit
services. These principal businesses include securities underwriting,
distribution and trading; merger, acquisition, restructuring and other corporate
finance advisory activities; merchant banking; stock brokerage and research
services; credit services; asset management; trading of futures, options,
foreign exchange commodities and swaps (involving foreign exchange, commodities,
indices and interest rates); and real estate advice, financing and investing.
Van Kampen Funds Inc. specializes in the underwriting and distribution of
unit investment trusts and mutual funds with roots in money management dating
back to 1926. The Sponsor is a member of the National Association of Securities
Dealers, Inc. and has its principal offices at 1 Parkview Plaza, P.O. Box 5555,
Oakbrook Terrace, Illinois 60181-5555, (630) 684-6000. As of November 30, 1999,
the total stockholders' equity of Van Kampen Funds Inc. was $141,554,861
(audited). (This paragraph relates only to the Sponsor and not to the Trust or
to any other Series thereof. The information is included herein only for the
purpose of informing investors as to the financial responsibility of the Sponsor
and its ability to carry out its contractual obligations. More detailed
financial information will be made available by the Sponsor upon request.)
As of September 30, 2000, the Sponsor and its Van Kampen affiliates managed
or supervised more than $100 billion of investment products. The Sponsor and its
Van Kampen affiliates offer more than 50 open-end mutual funds, 37 closed-end
funds, and have sponsored over 2,700 series of fixed income and equity unit
investment trusts.
If the Sponsor shall fail to perform any of its duties under the Trust
Agreement or become incapable of acting or shall become bankrupt or its affairs
are taken over by public authorities, then the Trustee may (i) appoint a
successor Sponsor at rates of compensation deemed by the Trustee to be
reasonable and not exceeding amounts prescribed by the Securities and Exchange
Commission, (ii) terminate the Trust Agreement and liquidate the Trusts 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 Trust. 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.
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.
Contents of Post-Effective Amendment
to Registration Statement
This Post-Effective Amendment to the Registration Statement
comprises the following papers and documents:
The facing sheet
The prospectus
The signatures
The Consent of Independent Accountants
Signatures
Pursuant to the requirements of the Securities Act of 1933, the
Registrant, Van Kampen American Capital Equity Opportunity Trust, Series 43,
certifies that it meets all of the requirements for effectiveness of this
Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933
and has duly caused this Post-Effective Amendment to its Registration Statement
to be signed on its behalf by the undersigned thereunto duly authorized, and its
seal to be hereunto affixed and attested, all in the City of Chicago and State
of Illinois on the 22nd day of December, 2000.
Van Kampen American Capital Equity Opportunity Trust, Series 43
(Registrant)
By Van Kampen Funds Inc.
(Depositor)
By: Christine K. Putong
Assistant Secretary
(Seal)
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed below on August 25, 2000 by the
following persons who constitute a majority of the Board of Directors of Van
Kampen Funds Inc.:
SIGNATURE TITLE
Richard F. Powers III Chairman and Chief Executive Officer )
John H. Zimmermann III President )
A. Thomas Smith III Executive Vice President, )
General Counsel and Secretary )
Michael H. Santo Executive Vice President and Chief Operations )
and Technology Officer )
Christine K. Putong______________
(Attorney in Fact)*
--------------------
* An executed copy of each of the related powers of attorney is filed herewith
or was filed with the Securities and Exchange Commission in connection with the
Registration Statement on Form S-6 of Van Kampen Focus Portfolios, Series 136
(File No. 333-70897) and the same are hereby incorporated herein by this
reference.
